Wealth Issue 2017: Comeback Kids

Amit Jain, 40, Anurag Jain, 38, Co-Founders, Cardekho

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‘Several ideas failed but the spirit of creating something meant more’

On a cold January night back in 2009, the brothers Amit and Anurag Jain opened a bottle of single-malt whisky in Jaipur, their hometown. It had been a sad and strenuous day. They had gone bankrupt, more or less, having lost Rs 1 crore of their hard-earned money on the stock market. Lured by the prospect of making a quick buck, they had been trading in futures and options—those volatile contracts based on share price movements—and over a period of just four- five days, as the after-effects of that year’s global downturn rang in, all the money they had staked was wiped out. They still had their business, including a portal called CarDekho which was yet to pick up, but they hardly had enough funds to pay salaries.

“We celebrated even our failures,” says Amit Jain, 40, “We had a drink that night, like on any day when we had a success or launch, and put it all behind us.”

They pressed the ‘reset’ button and started all over again. The next day, they were back in office on time. None of their 40-50 employees knew what had happened. But it had taught the Jain brothers one of their most crucial lessons of business. “We learnt never to risk our base capital. Corporate money had to be used with sanctity,” says Anurag Jain, who is a couple of years younger. After that day, they resolved never to break that self-imposed rule. It has served them well.

Confidence in their venture’s growth potential played a role. How quickly numbers can enlarge, they had seen with GirnarSoft, founded earlier as an IT outsourcing firm, that is worth a claimed $360 million today. “We measured our [2009] setback in time [lost], not in monetary terms, and the calculations made us realise that we would soon regain our losses. Our revenue streams were still operational, so there was nothing to worry,” recounts Anurag, an IITian who had studied mathematics and computer sciences. Amit is also an IITian; he did civil engineering.

Seated in the smartly done-up GirnarSoft office in Jaipur, scribbling out filtering frameworks for used car models on large acrylic white board table tops, they admit a certain thrill that comes with a startup. “I have felt high almost everyday,” says Amit. “We never lost hope,” adds his brother, “We keep challenging ourselves.”

They vividly remember the days when they first started out in 2007 in the garage of their family home, determined to create a software outsourcing success. They had a rented table, the kind used at weddings, cheap chairs, a cooler and the dream of building a billion-dollar company. With the help of former bosses and friends, their company took off and started getting projects, including a healthcare one from the Netherlands. They soon gathered a team of 20, ten of whom are still working with them (and were given Maruti Baleno cars when the company turned ten earlier this year). They made a profit in their very first year.

The brothers, both born on November 12th, attended St Xavier’s School, Jaipur, before joining IIT Delhi. They both had job stints in Texas, US—Amit in Austin and Anurag in Dallas— and worked in Bangalore in different companies. They returned home in 2006 after their father was detected with cancer. It was then that they thought of setting up a business in their hometown and turned serial entrepreneurs soon after.

Their primary approach was innovative: go for online services that Google would throw up right on top. “We didn’t spend a single dollar on marketing, but we learnt Search Engine Optimisation,” says Amit, “We put out good content.”

For CarDekho, a website for car buyers and queries, it has worked marvels. It claims 40 million visits a month, of which around 18 million could be those visiting twice.

Not everything they clicked turned to gold. Of the multiple ideas they came up with at first, many failed. Their attempts at a semi-precious stone and silver jewellery startup, aimed at taking their father’s gem stone business online, and another one for astrological services, their grandfather being an astrologer, did not make the cut they had expected. The jewellery business was shut down in six months because the brothers realised that it would not scale up unless they had inventory capital. That was too costly, and so a hard decision had to be taken swiftly. If fail they had to, they figured, it was best to fail fast. “We thought we should not let ourselves bleed too much. In the case of the astrology portal, my grandfather had to give predictions based on partial knowledge. People asked questions about marriage and careers. It involved people’s lives and we felt it was unfair to risk that,” says Amit.

We learnt never to risk our base capital. Corporate money had to be used with sanctity

They did not let the closures dishearten them. Their portals for cars, astrology and jewellery were launched the same day in 2008, and their grandfather had identified a ten-minute “auspicious time” for it. However, only CarDekho could get going in that window period. “I still feel superstitious that had we started the other two also within those ten minutes, they too would have been successful,” says Amit with a laugh.

THE LOGO OF CarDekho is embroidered on the pockets of their white shirts. This business owes its origin to a visit in 2008 to the Auto Expo in Delhi, from where the brothers picked up brochures from various automobile stalls and then put it all into a database back in Jaipur. Within two weeks, they were ready to take CarDekho live. “We thought it would be good for car buyers to get all the data on one site. We started getting traffic of 300- 500,” says Amit, “When it touched a thousand, we got excited.” They hadn’t foreseen that by the Expo of 2014, they would have a stall of their own.

They confess a passion for luxury cars, and spent their first earnings in 2008 on a 3 Series BMW that Anurag still drives. Amit has a Mercedes convertible. While temperamentally different, they are both technologists at heart. For years, they have worked side by side in cabins separated by a sliding window for a quick word with each other.

The car portal has been in expansion mode. It now has 1,800 employees across ten cities in the country, of which 900 work at the firm’s headquarters. Steady investment, say the brothers, has held them in good stead. For more than a year after CarDekho was launched, they put in only as much as their fine calculations justified, even as they kept a close watch on revenue numbers.

In 2009, they launched MobileDekho, on the lines of CarDekho, and MyIndianguide. In 2010, inspired by the popularity of e-commerce, they began ShopDekho, a venture in which they lost Rs 60-70 lakh. Other online shopping stores had already taken off with huge funding and were giving heavy discounts. ShopDekho was shut down in six months, but the price discrepancies they witnessed through that experience gave them another idea: PriceDekho, a portal for price comparisons. “An idea drives us. Several of our ideas failed, but the spirit of creating something was much bigger than everything else,” says Amit, “We never got demotivated.” Critically, they did not let their ego get in the way of taking “business calls” on their floundering ventures.

By 2010, CarDekho’s trafficstarted rising fast and was clearly on its way to market prominence. Encouraged, GirnarSoft launched BikeDekho, MobileDekho and CollegeDekho, all to capitalise on the recognition of the suffix ‘Dekho’. Till 2013, not a paisa was spent on marketing. “The company had to understand how to increase traffic without spending money. When CarDekho started doing well, people started approaching us for advertisement space. They asked us to quote rates, but we had no idea what rates to ask for, so we said ‘You tell us’,” says Amit.

In November 2013, the company raised $15 million in A-series funding from Sequoia Capital. In September 2014, CarDekho acquired the Ibibo Group’s and in 2015 bought Times Internet’s Zigwheels, consolidating the online auto market under its banner. Times Internet joined its list of investors, which now had Hillhouse, Tybourne, HDFC and Ratan Tata, apart from Sequoia.

The quiet life of the Jains was bound to change, and it did. While GirnarSoft had been a success, it is CarDekho that has drawn the spotlight. “By the end of this financial year, we hope to close on a profit note. My monthly operating loss is reducing from Rs 15 crore a year ago to Rs 2 crore now. By March, we will fill even that gap,” says Anurag, who adds that their larger enterprise did not post a single consolidated loss for the first seven years; despite losses on a few ventures, it was profitable overall.

Their goal now is to make car-buying even more hassle free and turn CarDekho into one of the five biggest auto portals in the world. Claiming that the portal gets almost half the car buyers giving it their contact numbers—a sign of customer trust—the brothers now want the business to meet a wider range of needs related to automotive lifestyles. “We want the consumer to be with us through the entire eco-system, from buying to maintaining a car,” says Amit.

In some ways, they remain Jaipur boys. The city has always had the advantage of lower startup costs than for a firm based in Bengaluru. And they have run a tight operation indeed, hiring greenhorns and mentoring them because they could not afford experienced hands. The brothers are thankful for all the guidance they themselves got from their mentors. “There is something to learn from everyone. A lot of people helped us and played a pivotal role in shaping GirnarSoft,” says Anurag. He also recalls the day they met Ratan Tata: “We had got a ten minute slot with him, but he ended up spending an hour with us.”

On a philosophical note, Anurag says everyone has a window of time for an opportunity to be taken. Beyond this, what matters is the legacy to be left behind. The brothers named their first company Girnar after their family home, which their grandfather had named after a mountain top in Junagadh district of Gujarat, the place where Jains believe their 22nd Tirthankara Neminath attained moksha. “There is no religious connotation in naming it Girnar. It was the family home. We are not religious, nor are we atheists,” says Anurag. The brothers still live in that family home, though their work rigour doesn’t let them spend much time there. In their early days, they did not return home for three days at a stretch once, sleeping and eating in the office.

Today, GirnarSoft is a buzzy corporate office. It’s past 8 pm, and work shows little sign of letting up. Glass doors swing open and close in a brightly lit corridor. Some play table tennis in a room next to the lobby. A few employees are leaving for the day. Some are stuck to their computers. As for Amit and Anurag, they have a dinner to attend with an Indonesian investor.

They are chasing more than mere revenues, they say, looking at where the future might lie. “If you don’t innovate, you will not diversify.”