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Editor’s note: Marketer Spotlight is a series of blog interviews focused on sharing insights and best practices from marketing leaders on the various aspects of marketing in a digital world. In our latest edition, Ashish Kashyap, the Founder of GoIbibo and IndWealth, unravels the secrets to finding the right product-market fit and tells us what it takes to build a business model and culture around rapid experimentation?
Ashish: My latest venture is called IndWealth, a wealth management platform, which solves problems of high net-worth individuals. The first attempt of this platform is to solve problems of the affluent and the high net-worth individuals to enable them to manage money, future cash flows, taxation, etc. We do a great job at managing the PNL for our company, the future cash flows, the audits. However, we don’t do great when it comes to managing our wealth or that of our family. That’s the problem IndWealth is solving.
We have on-boarded 2000 families, and they have liked our product and are very engaged. Our data looks exciting too. However, it’s the early days. I think we shouldn’t get too excited about the early days. We should just keep learning and executing. That’s exactly what the platform does. It’s a full-stack wealth management platform. A lot of it comes from the pain area that I have heard from my friends, colleagues, entrepreneurs. Some are from my personal experience too.
Watch Ashish describe INDWealth and why he decided to build a wealth management platform in the video below.
When you are building a business, there is something called a deliberate strategy. Building a business is almost like raising a child. There is no recipe or a formula; there is a lot of iteration and a lot of hit and trial. GoIbibo was on an incubation fund back in 2007, a time when people even didn’t know what an incubation fund is. Being an incubation fund, the core idea was to invest and build multiple little incubations within the system. We built gaming; we built Sawaal – a Q&A product. We also invested in and acquired a vertical search engine called Big C. We had a small fund, and we used it to invest and build certain businesses.
What I realized back in 2007 was, on the one hand, talent depth was missing, and on the other hand, internet penetration was missing. So, we decided to double our experiments, which were beginning to blossom. What came out were some very good success stories like GoIbibo and PayU. We also bought RedBus and grew it by 10-12 times. We had multiple things. The learning was that experimentation is a very critical thing, and if you can lower the cost of experimentation, you get more benefits. That’s how these businesses were born. Another thing was timing, which is a critical part. We were building a travel business at a time when users were gravitating to a particular use case because developing a new use case was very hard and expensive. For example, if I would have tried to replicate the behavior of Musical.ly in 2007, it would have failed, because there was no bandwidth and critical mass or penetration to share your expression.
Timing is really important. At that time, people had begun to travel, but a lot of systems were broken. We didn’t have to invest in user behavior formation at that time, and that’s how our business took off. Similarly, in the case of PayU, there was Billdesk, which was not so reliable, but there was a need for reliable gateways. PayU was reliable, and conversion rates were better, that’s how PayU happened. We can put it in a structure now because it has worked out, but at that time it was chaos.
It could be a business or a feature. It is about your overall platform. It comes down to do you want the platform to succeed, or do you want to be attached to the feature. My suggestion is that one should reduce the cost of failure and be very decisive. Sometimes that decision may be wrong. But you have to move on, because of the minute the cost of failure increases, it sucks away all your resources, motivation, and energy. It should be in the interest of the platform to succeed.
At the surface, it seemed like a well-served market. People laughed at us back then for launching another traveling company. Things look solved at a surface level, but when you start digging, you notice a huge amount of structural problems in the industry, which have been unsolved and it’s very hard for incumbents to solve. This is because they have been living in a comfort zone and growing out of the momentum effect. We went to Make My Trip, Yatra and Clear Trip to ask them to give us a feed as we are launching a metasearch and building a routing algorithm. They shunted us out. They said that we will take the feed from somebody else, but we will become an OTA and conclude the transaction at our end. While all of these seemed as a well-served market at the surface, it was still unreliable. For example, if I go to checkout, my price would increase, or if I want to cancel my trip to Bangalore, I would get my money back after 60 days. These were very basic issues that we solved.
We also took a view of the tradeoffs – what we could do better than other players and what we could give up. For example, we gave up a lot like we won’t do holiday business or package business, we won’t set up call centers because call center’s fixed cost expenses were very high. We would do our pure-play, it had to be ‘do-it-yourself’ always. The value of the consumer was always better. We also built our own viral engine GoCash that got our company to take off.
We gave up a lot of other things like telephone calling and the traditional way of the marketing funnel. We had to solve problems not just for the customers, but also for the hoteliers. At the surface, everything looked solved. But it was broken. It was a broken industry, which created a huge opportunity.
Give anything valuable to the consumers, and they will be willing to try it. Consumers are now willing to experiment with new applications and new use cases. This helps us to get a feedback loop quickly. When we decided to open our application a few weeks ago, thousands of people came in. We had to close the door. These were great alpha users who came quickly to test things. I think this world is now multi-screen, earlier the web and the mobile were not intersecting.
Today, people are toggling between web and mobile. Then there are different sides of a platform such as your supply-side and the buyer’s side. They are also using different screens. MoEngage can definitely help us to analyze consumers across devices, reduce consumer friction, and help us personalize communication. For example, we can use MoEngage in a very intelligent manner to communicate with our users about the activities which they should be doing if they have to retire five years earlier.
My advice would be to simplify use cases, and for multiple use cases, we would be able to leverage your tools.
I think your first set of users should really love you. If you ask me about achieving product-market fit, I think it’s too early to say. The indicators and patterns are good, but we shouldn’t get excited by the early users. Product market fit means people should really love you. Like, if you run an NPS, it should hit an NPS of 70-75. All these are indicators that you are valuable to them.
There can be a number of mistakes. One could be that you overspend at the mouth of the funnel, and your product is not there yet. It is expensive and the entrepreneurs should realize that these are on and off buttons for customers. For an entrepreneur, it might be a life switch. The other expensive mistake is the hoardings with false promises. If you promise something, you have to fulfill it. Google does a great job at that.
If you study the Google algorithms, if the customer comes on a landing page and is bouncing, it means that the quality scores are bad. It means that the entrepreneur is making expensive marketing mistakes and spending a lot on CPC. These are the things we all should avoid.
Every business has different economics. Firstly, I don’t think that businesses would do well without growth. It is a very important thing. But whatever you do, you need to basically build some metrics, which will help you to build your own secret sauce. It depends upon the context. People say I want to grow with a ‘Y’ NPS and a ‘Z’ CAC etc. Another company could say that I want to grow the buyer side and also the supplier side to make the market liquid. So, companies have to look to a different formula.
When Uber or we were building a business, we were not even looking at the CAC formula. We looked at the formula of market building exercise. I think there has to be different metrics, but one shouldn’t grow with a massive leaking bucket. One should solve that first before investing in the top of the funnel.
Thank You, Ashish. It was a pleasure chatting with you on the ways to experiment and finding the right product-market fit for your business. We wish you the best for your new venture – IndWealth. We hope to connect with another marketer and touch upon a different aspect of marketing in the next feature of Marketer Spotlight.
Is there someone you’d like us to feature? What topics would you like us to cover in the Marketer Spotlight series? We invite your recommendations and feedback by writing to us at [email protected].
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