At 42, Ashish Hemrajani of BookMyShow has been a survivor since he founded the company in 1999. He’s lived through the e-commerce boom and stayed under the radar, far away from splashy headlines.
This Outliers Podcast we recorded with him in September 2017 remains one of my favorites.
BookMyShow is definitely a unicorn today in terms of its valuation. But that’s not what makes the company and its founder special. It’s the long, slow and painfully illuminating startup journey over nearly two decades that offers some great entrepreneurial and life lessons.
Read through and listen to the podcast here.
As always, thanks to Kanika Berry for the transcripts.
Pankaj: Welcome to Outliers, it’s a podcast with Outliers and I am really happy and excited. This has been quite a chase to get the guest of today’s podcast and I am really happy to have Ashish Hemrajani, co-Founder of BookMyShow.
So why do I think he is an Outlier? It’s a good question to start with for myself. I think from the first time we met, Ashish, I always found you to be restless and you know, with lots of passion and like you rightly pointed out, not so efficient on the time management side. I met Jeff Bezos when I was with The Economic Times and I kept asking him questions about what do you think of Flipkart, what do you think of Sachin Bansal? They had put up a hoarding outside his hotel room, he kept ignoring those questions and he kept giving me this answer about how he is obsessed about customers and I was like, “What a diplomatic answer!”
A year ago, I was thinking about that interview and I realised that what he actually meant because when I was looking around the state of Indian ecommerce, I found a similar zeal in you when it comes to being obsessed about the customers you want to engage with or you want to target. …that is why I think you are an Outlier because I wish a lot of entrepreneurs including me would keep that focus intact. So, welcome to Outliers, Ashish.
Ashish: Thank you for having me and for starting the podcast with a comparison to Bezos. What else can I ask for? But with humility, thank you very much.
Pankaj: You know, he is not really a likeable person but really admirable for what he does and how he does it.
Just to kick this off, Ashish, in many ways you are not the kind of entrepreneur, people like me have grown in our career tracking, you know, the so-called post dotcom-bust entrepreneurs and all that. I think you started BookMyShow in 1999.
Ashish: That’s correct.
Pankaj: And you have seen the dotcom bust, Lehman crisis, you seem to have gone through a very different curve altogether. What has internet in India taught you? What have you learnt from internet since then to now? What are all the key lessons?
Ashish: Well, you can colour it with a brush stroke of calling it the internet or what has the internet taught me but I would say, along the way a lot of things whether human enterprise endeavour, people, respect, first principles of business or of just being a human and I have been self-taught. These are some of the lessons that I have learnt over a period of time. You know, but if you were to specifically ask me, what has the internet taught me is that, no good times and bad times are permanent, number 1. Number 2, focusing on and obsessing about your customer and putting the right metrics in front of the people internally and externally which is your customers, your users, your employees and your shareholders is very important. And once you do that, you don’t start going crazy and living in your own distortion reality which is some sort of a bubble in your head which is a fake bubble. And what I mean by that is, you know if you have seen the series Silicon Valley or if you have read the book Disrupted, that’s exactly what is happening in India or was happening at least and continues to happen; for example, you have valuations that have far exceeded and run ahead of the metrics and then either the metrics have to catch up to those valuations or the valuations have to come down.
And, then, there are so many decisions that get taken and calls that get taken, when you are running a business… they are not in touch with reality as to what that business means for their customers or what their business actually means in an environment which is India. So, for example, everybody ran after this 1.2 billion customer base. That 1.2 billion customer base does not exist. Number 1, you have to realise that India is not one country, it is an amalgamation of many countries put together… which is run by one government.
I would say that India is somewhere between the US and Europe. Europe is many countries stitched together with one sort of, free trade agreement and currency, and America is one country. India is like Europe in a lot of ways but it is still one country and when you look at your customer groupings by SEC (socio-economic category), by caste, by disparity and income, by demographic, by language, there are pockets of customers and there are many Indians, three feeds of India, two feeds of India… everybody is running after this one homogenous customer base and that’s why you tend to overspend and do stupid things.
We (at Bookmyshow) have never believed in that. And we always knew that we were in a business which needed data and internet connectivity. It needed a device, it needed a payment mechanism and then on top of that, you have had to have spare time and money to be able to go and indulge. So, why would we run after a guy who is in a tier 4 town with an income of Rs 2,000? I would love to have him on my platform but I would not be able to make any revenue out of him. So I am spending money to acquire him but I am not going to be earning ever out of him, my LTV (life-time value) will go for a thousand years for that guy… my lifetime value, if you do a CAC (customer acquisition cost) over LTV, it won’t even add up.
But then, once you built a critical mass which we have today… we sell currency when we sell a ticket, we are almost like an RBI, we are issuing currency to you. Once you have a ticket in your hand, it’s my obligation to honour that and if tomorrow there is a show that is cancelled, you are upset about something, we refund you things, we make sure your money is secured, you get the entertainment that we promised. Therefore, over a period of time our NPS (net promoter score) has gone up, we have got a lot of faith with our end-users, our customers… and(we have) a critical mass, now to say that, ‘Hey listen, can we use this as flywheel to do other things? Can we increase our funnel? Can we get in new users? Can we cater to new demographics?’…there is economic disparity and (consumers) may want to consume some sort of entertainment but may not be able to buy.
And so therefore, we built other things which are adjacent to in the entertainment business on BookMyShow and that we have started sort of, focusing on over the last two years and suddenly you will see over the next few months, a few of those launches because again, we do it slow but we do it right. I can’t launch five businesses in three months and launch 60 countries in three months, aisa nahi hota hai humse (we don’t do it this way), you know, we are struggling with acquisitions and investments in 4 or 5 companies and trying to get that culture to fit in. For us to take over those companies and work for those people, it takes the mickey out of you! So, if I see every day one company is buying, every fortnight there is a new company that is being acquired, I wonder how you are going to even integrate these guys, right? If you are just buying traffic, then it’s a different thing, then I might as well spend money on SEO (search engine optimisation) and buy traffic.
Pankaj: I think what you are mentioning is a very interesting aspect that I heard few weeks ago when I was chatting with Sridhar Vembu of Zoho and he talked about he loved speed breakers on his journey and this, doing it slow… the slowness because that’s what he was talking about. You also seem to be like taking time, you are not really distracted by so-called competition or market forces or anything else.
Ashish: See sometimes you need to be nimble, quick, fast, reactive, I don’t disagree but the fact is if you are on a trek and there aren’t any resources and you need to quickly eat a meal to be on your way, you can make instant noodles. No problem. For that time of the day, for that period, instant noodles while climbing in the hills is most important.
But if you have the luxury to do the right thing, to do it right, then you need to cook that slow-cooked biryani overnight over coal fire, to get the best bloody biryani on earth, then instant noodles won’t do it for you. So, there is a different place and time for and different environments for different reasons and, therefore, we still call ourselves a startup, we hope to be nimble, we create an environment and culture of people that can be mercenary in a lot of ways when they do certain things but there’s also the objectives and goals that we have set within the company (that) far exceed personal goals or just revenue goals or valuation goals… those are the last goals that we sort of follow, at least in valuation terms, short profitability, revenue, are you making money on everything, you are not blowing up money on stupid things… (these) are extremely important.
At the end of the day, what is it that gets you closer to the customer? What is the value that you deliver to the customer? And any action that you take, is it adding value to the life of that customer? And if it’s not, then you shouldn’t be doing it or that person is then not required to be doing that job.
Pankaj: Ashish, generations of entrepreneurs have been trying to sell to this Indian online consumer. You have been dealing with this since 1999… who is this quintessential Indian online buyer? Is he or she the same person who goes online to do an e-commerce transaction or is he or she the same person who consumes digital content in different forms? What is this pool like? Can you bust some myths here?
Ashish: Yes. See first of all, there are 1.2 billion Indians which have about eight to nine hundred million handsets with about 400-500 million smartphones and about 350-400 million data connections. With the incumbent new, you know, a new platform and telecom player, those numbers are rapidly changing and dramatically. As the price of connectivity has fallen and the speeds have improved, you will see a big disruption and you have seen that, with mergers and acquisitions happening, new phones being launched, deposit only, free for a long time. So I think there’s been some serious disruption. I believe YouTube’s usage has gone by 5X or 6X over the last maybe eight months or 12 months. So there’s some serious disruption. But having said that, the ecommerce customer in India primarily has been your urban customer, your SEC A and B, your urban customer of top 10 cities, 15 cities at best, and it’s really been your 32+ customer segment and as cash on delivery was offered, that segment changed slightly from SEC A and to B maybe even C and from your top 15 cities to maybe the next 40 or 50 which is your million plus population, next 54 or 56 cities where the pop strata is more than a million plus, it changed to that. As far as BookMyShow is concerned, we are present in more than 620 cities and towns in India. But you may still be present but that’s really not your customer today. I would like that to be my TG, so there is a big difference between who your customer or user is today and what your TG is. Your TG is who you want to go after, your user or customer is who is your customer is today. So for us to widen the funnel, really our focus the way we have divided it, is to say that there is a 24-32 customer base out there, there is 18-24 and then there is a 12-18… and so what are the kind of goods and services, products or content that you would like to cater to for the 24-32… what do you want to cater from somebody who is from 18-24 and then within that, is it language based, so what is your regional strategy? What is your socio-economic demographic? What are you catering to, only the SEC A or B or C?
And then there is a geographical spread. So, there are these intersections of segmentation that are very important for you to get to unlike any other country where everybody speaks in Chinese, everybody speaks in English and or people may speak a different language in Europe but the general (trend) there isn’t that much inequality of wealth, the distribution is fairly even. In India, the economic disparity is so much that you may carry the cell phone and so do I and so does your maid or your driver but what that cell phone means to them is very different (from) what the cell phone means to you. So they may be buying the same product but that is there economic gateway because he can get business by driving a car like an Uber or Ola or he could be using that to land himself into a job; he gets called for overtime and that is his life; he will watch a movie on that, that’s his only gateway he may not go to the movies. But on a Sunday, with his family (he will) watch a movie on that by side loading content… and that is his life, that is the centre of his universe.
The phone for us is a tool. You may have a 4K TV at home, you may have Netflix, you may have Amazon, you may have Apple TV. Anywhere else in the world, roti, kapda, makaan (food, clothing and shelter) is pretty much taken care of, yahan pe toh usko khane ke liye paisa nahi hai (he doesn’t have money to eat)… he is struggling with paying rent, he is struggling with medical care, he is struggling to send his kids to school but he may still have a smartphone. That’s a very different rationale and reason why he has it. So it’s very important to understand the nuance of that Indian consumer and who and what do you mean to him in his life and only then can you make a difference and unless you cannot make a difference and add value to his life, you have no reason to be in business. If it’s only for profits, then toh koi fayda hee nahi hai (then it’s of no use).
Pankaj: What does it take to win this Indian online consumer? I am also asking that question because, I mean, everybody from Facebook to Google to Amazon… is after this so-called Indian internet and like you rightly said, it’s not really a homogenous kind of crop but in your learnings, how can you win this?
Ashish: See first of all, they need to have a data connectivity, pehle toh wohi problem tha, right?! (Earlier, that was the problem, right?!)… there is no data connection itself, that in itself, if you don’t have the roads, what are you going to drive? So, I think, the Japanese took a very long-term view of… if you look at Indonesia, it’s such a wide country, actually railroads would have been the most sensible thing to do in that country. The Japanese invested in that country, building roads and giving soft loans at maybe next to 0% interest because they knew 25 years down the line, they had the vision to know, ki agar road build hoga toh gadi chalegi (the car will only move if the road builds). Today, 70% of all the cars that they drive on Indonesian roads are Japanese cars and 60% or 70% market share out of those 70% Japanese cars is Toyota. So they had the foresight to say, yaar pehle road build karenge toh gadi chalegi na (only if we build the road, will the car move!), agar hum road nahi build karte aur rails ban jaate ya toh phir air strips ban jaate (had we not built roads, either rails or air strips would have been built), people would be taking flights. So, I think that sort of vision and long-term view is lacking from a lot of people.
So the point is, the first thing is, that is everybody is connected? Does everybody have a device? That’s your first starting point. Then it has to be a stable and a very cheap low price point connectivity. That problem is getting solved and we are seeing that every day, you are reading about it every day. Once that gets solved, you will have to figure out, what is that the Indian consumer is actually doing? Today, everybody talks about Facebook and they talk about Whatsapp.
If you look at urban India, there’s a big phenomenon. The big phenomenon is that, kids below the age of 18 years actually don’t like Facebook, they are not on Facebook because their uncles, aunts and cousins and fathers and mothers are on Facebook, so they want to stay away from Facebook because they don’t want their lives exposed to them, right?! Or they are putting very basic and clean stuff. Everybody is on Snapchat, they are on Instagram. Instagram is where they sort of, really communicate and the ones’ below 15 years in urban India or completely off even Whatsapp, the only way they communicate is on other mediums of communication, they don’t even communicate on Whatsapp.
So, it’s this deep understanding of who this Indian consumer is? What are they going to consume? So for example, as far as BookMyShow is concerned I can use our own analogy that we have something called ‘Planet’ where we make a plan for a movie and it’s a chat, service within BookMyShow and four friends can go together. I can make a plan, share the screen, everybody communicates with each other on chat, they are not calling each other, they are chatting on the platform and then they all go to the movies together, decide to meet at a meeting point which is also built into the chat platform and they all split payments, so all the money goes into each one’s wallet, they all split the payments, they all go to the movies together and then they come back as a group. So it’s really about building a social layer and for people to use their native way of communicating today. So when you make a plan today, everybody at least at our age creates a Whatsapp group, ‘dinner at home on so and so date’ and the life of that chat is till the dinner happens and then everybody says happens ‘thank you, thank you, thank you’ and starts exiting the group, right, so it’s a behaviour. So it’s catching these trends and behavioral points.
So, I think, the Indian e-commerce customer as you said, is very different in urban markets, it’s very different in Tier 2 markets and we did a small study in rural markets to see how and what do they consume and we found some incredible insights that the mobile phone, the TV, and the temple which is the ghar ka mandir (temple at home) are the three most important things that are in a household. The temple, the mobile phone and the TV are always at the centre of the living room. These kids are wearing soccer clothes and all of that and they are buying from online platforms and they are paying on cash but they have these delivery centres where these goods are getting delivered to a delivery centres which could be about 10-20 kilometres away from your village or your home and they are going on a bike and collect all of that and come. So we were trying to figure out what are there viewing habits, do they like soccer? One interesting insight we found was that, there is a massive following in this country for wrestling. It surprised us and outside of cricket, in a lot of markets wrestling was the number 2 most, sort of followed sport which I mean doesn’t even exist here. So, India is a complicated country but it also makes it that much more fascinating for you to pursue these customer segments and offer products, services, goods to be able to cater to their needs and demands, not just the product that you have built. If you stick to that, ‘Hey listen, this is what I have built, this is what I am going to stick with’, you won’t hit that scale.
Pankaj: The other insight I wanted from you, Ashish, is that a lot of entrepreneurs are now looking at the intersection of tech and internet with entertainment and thinking of new ideas or build new businesses. The death of the screen has long been talked about and then these new disruptors from Amazon to Netflix and all that. In your view from what you have seen, is the death of the screen exaggerated? What is really the future?
Ashish: I think it is exaggerated but look I am not a soothsayer or a fortune teller and these may change.
Pankaj: Also, like you are a player, so not just because of that.
Ashish: Also. So putting that disclaimer, yes, I have an interest in that but look again. Go back to first principles of human beings. I am saying, forget business, just first principles. We are a hot country, eleven months of the year the temperatures are pretty harsh for you to be outside and, therefore, even today, while you and I are sitting and talking, we are sitting in an air conditioned cabin. If this was anywhere else, we’d be sitting outside, there would be no noise on the streets, there is no honking, there’s no screaming, it won’t be as hot as it is. India has the maximum amount of sunshine with the highest vitamin-D deficient nation in the world. Why are we vitamin-D deficient with so much sunshine because nobody goes out, they have an obsession with being fair…
You have an obsession, we are the most racist, we like fair people and therefore with this obsession, you see people riding bikes, they are covered, you know completely from head to toe, you can only see the eyes… even they are wearing gloves and riding bikes.
And, therefore, movies offer the cheapest form of indoor air conditioned entertainment anywhere in the world. If you go to Udupi restaurants in India, you go to South India, you come to Mumbai to an Udupi restaurant, you will realise there are hardly any windows because you are saving on electricity cost on air conditioning. Right! So we like to be indoors.
Look at the Middle East… everybody shopping in malls, your entire activity or time pass or going on a ski lift or an aquarium is all in a mall. If you go to Dubai or Abu Dhabi, they were not born with the genes of shopping. Suddenly, they were not born and said, ‘hey listen, I am a shopper’. The reason is they are indoors because it’s 45 degrees outside, there’s nothing else to do.
So, again with India, movies is one social activity that you can do at scale, at a very reasonable price and that is why it will always at least for the long-term future, stay and stick because it’s a social activity which you do together. If you go anywhere else in the world, sports takes up 53% of the economic value of entertainment. In India, 76% of the economic value comes from movies or a derivative of that. Big difference. And, therefore, if you look at how films were marketed at cinemas in the past, they used to be called air conditioned cinema (DTS) or air cooled cinemas, so the selling point or the USP was that it is air conditioned or air cooled, so you can come and enjoy in comfort, the air conditioning and by the way, ‘hey listen, you are also watching the movie’. So that is sort of the first principle or thought process I have.
The other one is that, if you look at these one of these paid subscriptions services, I think the big difference is that, in the US the average price point of cable TV combined with your internet connection at home to an average American household is about $80 to $100 per month and so it is $8 to $10 price point. 50% of American households actually don’t subscribe to cable but subscribe to this service, 50% of American households! Because this is their only window to entertainment. At $8-$10 price point, it’s not that bad, it’s 10% of your cable bill. In India, your cable bill is Rs 250, so 10% of that is Rs 25. Rs 25 mein aap kya doge? (What will you offer in Rs 25?) And on top of that, the latest telecom player is giving your internet connectivity at Rs 153 and all your cable TV and all of that comes free in that, toh kya disrupt karoge? (So what will you disrupt?) How will you be able to disrupt any other business, if your business itself will not be able to hit scale? So unless somebody figures this out that I have to be at 10%, chalo 20% of the cable price…
Pankaj: Even then it is 50 bucks.
Ashish: Yes, even then it is Rs 50, toh Rs 650, 500, 800 toh aap chodh do (leave Rs 650, 500, 800) and that you will hit some nice numbers which will probably make you happy and put a flag in another country but it’s not going to radically transform entertainment to say, 50% of this nation, lens of entertainment will only come through this platform. Woh nahi hoga (that will not happen).
Pankaj: Final 2-3 questions, Ashish. One of the things I noticed is, I was thinking about the parallels between Deep Kalra of MakeMyTrip and then your journey.
Ashish: He is a good friend.
Pankaj: He started in 2000, you started in 1999.
Ashish: No, he also started in 1999, same time.
Pankaj: He built this online travel business. And, of course, now when I meet him, I always ask this question about, so what do you make of disruptions? What do you make of newcomers? You know, are you an incumbent now or a legacy player now because there are always new ones coming up in those sectors? Same applies to you as well. How do you look at competition? It will be two decades soon for you as well, right?
Ashish: So we’d been around for 18 years. Look, when I founded BookMyShow in 1999 along with two friends, we had about 15 competitors, not very many people. And then, you know, with the dotcom crash… 2001-02 happened in India, all of them died and then again in 2007 when the markets turned, we had a few competitors. By 2008, a couple more died when the Lehman crisis happened and then again when this whole gold rush which is the internet boom, this artificial boom, crazy amount of investing and few ideas and people were going cuckoo in 2012…13…14, again we had some crazy number of companies.
So, we acquired a few, we did a slump sale, we invested and few sort of shut down and there are few which are surviving; some really large, horizontal, some which are focused and are raising capital but look it’s important to know who your competitor is but lifelong you cannot have a competitor-obsessive strategy. A lot of companies and I have been to some of my competitors or quasi-competitors, people who wanted to get into our space. They put up these grand posters in their office – kill competition or they will put your brand name and cancel it out… we will be an XYZ killer.
If that is the culture that you are building at the leadership founding level, we have seen what has happened recently to certain phenomenal founders internationally, they have been ousted. This doesn’t last, you have to generally be a good person, you have to do the right thing, you have to have your wits about yourself and then if you have these qualities, competition is important, there is no question about it but the fact is, what are you doing to innovate? What are you doing to grow your business? What is your next move for your customer? How are you adding more value to your user or your customer? Are you being able to deliver value in his life? The day you do, you will excel in what you do. The day you don’t, you will become irrelevant but the fact is that if you just follow your competition then either he is going to outbid you or you are going to outbid him.
Both are going to be bereft of ideas because everybody can raise capital at scale very easily and you can kill each other with capital. At the end of the day, you are not going to build any lifetime value for the customer, you are just bribing customers to get you. Agar bribe hee karna hai, toh mein yahan Rs 20 ke note lekar khade ho jata hoon, mere office ke bahar 4 kilometre ki line lag jaayegee (if I have to bribe only, I will stand here with Rs 20 notes, there will be a queue of 4 kilometres). If I am handing over Rs 20 bill, so why do I need to start an internet company, hire people, make myself look good as a founder and then give Rs 150 discounts. If I give Rs 150 discount, Rs 40 notes ki line lag jaayegi (there will be a queue for Rs 40 notes). It’s stupid, man! I think it’s just absolutely bizzare, that’s exactly what’s going on. I am handing a Rs 100 bill to a guy and saying ‘you are now my customer, apna email id, mobile number de do, you are my customer’ (give me your email id and mobile number), its called customer acquisition. How often is he coming back? And then people are saying this is land grab, let’s acquire the customer, phir dekhenege na (then we will see), how will he make money out of this customer? Can you please put down what is the light at the end of the tunnel, when are you going to make money? Who’s asking the hard questions, right now it’s all about land grab. It’s stupidity. But let it continue. Everybody will come to their senses for every new hero that is born, in the pink papers of the paper, there are at least another 10 of 20 that die but those don’t get spoken about. Every new restaurant that gets launched, there are nine that get shut down but nobody knows when they shut down. Woh quietly one day, sign board lag jata hai (quietly one day, there is a sign board) but the day they launch, there is a lot of PR activity and celebrities go there, right! Same thing ho rahee hai humaare business mein (same thing is happening in our business), so you have to just stay calm and focus obsessively on your customers and your users and if you do that and you continue to add value in their life, they will keep coming back.
Pankaj: So there are these… like Paytm, of course, is clearly the one who are trying to become, who have battlefronts across different verticals, includes travel for MakeMyTrip, includes ticketing for you know, BookMyShow and so on. What do you make of those platform play and I am asking that question because does it kind of question the whole, is that niche versus big platform kind of a battle or what is it?
Ashish: See platforms are being compared purely because they came out of another geography. Please understand, in that geography, everything was controlled, there is no YouTube, there is no Facebook, there is no Uber, there is no Gmail, there is no Whatsapp.
Pankaj: You are talking China, of course.
Ashish: Yes, you control everything, you block everything out then your investment comes from quasi-government agencies, supported by the government. To be able to create a walled garden, so it’s an effect of walled garden and then you hit scale and then you say my platform works.
India is an open market, everybody is allowed to compete neutrally, anybody can enter, everybody can raise capital, you are free to run your business and there is something to say about what you can and cannot focus about. I think Apple builds the best devices and they have the best experience, user experience in whether it’s camera technology or whether it’s there iTunes music. I mean, Apple could have said, ‘Listen, I am going to get into books’ but I could have also said, ‘I have gotten into books’ and then they built a Kindle out of that. So they kept innovating around that and they used that as a flywheel then to launch many other businesses which use that same beating heart of the company to say that, ‘this is what we can scale’, so I think that’s how India is many, many decades behind but we will leapfrog and catch up very quickly and we are in those early stages of what you saw in some of those mature markets.
People keep comparing us to China just because our population is the same or we are standing at the borders together, that doesn’t mean we are the same. China is very different from India, India is somewhere in between a China and a US and I think, you will have to, different strokes for different folks and you will have to operate very differently in India. So I am not so sure about this whole horizontal play because it’s all gets spoken about.
We are going to get into 500 categories and we will build a payments business at the back and then people use this data, the data so valuable, we will be able to churn it and make money out of that. I think the government’s view in India is to actually make payments digital and get MDRs down to zero. They don’t want you to make and skim money off people on payments, that’s why UPI launched which was a government platform, that is not launched anywhere else in the world, it’s an open platform which can be taken by me, it can be taken by Whatsapp, it can be taken by Facebook, it can be taken by you and you can make payments.
So, then where is the payments piece which is there in China? I am saying, look, let the cookie crumble over a period of time, I think there is something that speaks of being obsessively focused on what you think you should be doing. BookMyShow has also gone horizontal and while we used to be a ticketing company, we are not, we are more so a digital entertainment play now. We have something on the music side, we have something on the live events piece, we have got the ticketing side of the business for sure, we also have something on the videos, then we have got the whole review and ratings section on BookMyShow and then the whole data around your actors, actresses, the long tail of the content.
So we have also got four or five verticals and I think over time, it’s that same user, it’s like you know, if you were running an FMCG business, can you say that, User X will only use toothpaste, User B will use washing soap, User C will use shampoo but not conditioner? It’s the same guy who may have different needs at different points of the day. So to us also, if you are curating your user base and you have got an X user base, are there more things that you can sell and cross-sell to that same user?
And can you get new users by coming up with product categories which you don’t have today in your arsenal and you engage with them and acquire and engage and build same frequencies with that and then eventually cross-sell what your core business today is… and it’s all about building that pipeline over a period of time and making a 360 plain entertainment. Now, if that is valuable to users where they think they need to come to you every day and they like what they see, they are seeing value in that, then whether you are niche or you are not, shouldn’t really matter because if today there’s a restaurant called Nobu. He still has a three day reservation lying outside because it is the best restaurant you ever went to or that guy in Italy that sells you a pizza or a guy in the US who sells you pretzels and you are still lining up for that and you could say, ‘listen, I should order five hundred items on my menu’ like an Udupi restaurant where you can be Chinese, Indian, Punjabi , anything, I mean anything under the sun, any cuisine will be there or you say, ‘listen, I am going to be obsessed about something that I want to do’, so there are two clear strategies. So, you could be an Udupi restaurant or you could be the best pizza shop, I mean, it’s really up to you but only time will tell and you have to live and die by your user…. The two of us are sitting here, the third chair should be the user, the customer’s chair and if the customer likes this conversation, the customer believes in this conversation, the customer thinks, ‘Hey listen, there is value to what I am getting, you have no reason to worry’.
Pankaj: Yes, I see that what you are saying. Final question: will be two decades like we were discussing, I mean, almost…? Why are you doing what you are doing? You know, very open question but very honest one — why don’t you get fatigued? It’s been too long, isn’t it?
Ashish: I have a funda in life, see if your Monday mornings are as exciting and energetic as your Friday evenings, then you are doing something right in life. The day that equation changes for one of these two, that I start enjoying my Friday evenings more than my Monday mornings or I enjoy my Monday mornings more than my Friday evenings, then some balance has gone off.
So balance is very important. You are running a marathon not a sprint. You can’t burden and burn yourself seven days a week as an entrepreneur. I am very passionate about what I do, I am super excited, I love coming into work every day and finding new solutions for users, understanding new user insights. But I also like my Friday evenings, I like my drinks, I like going out, I sail on the weekends, I love spending time with the family, with friends and on Sunday evenings I don’t get depressed, most people go for sundowners on Sunday because they can get drunk because Monday morning depresses them. I am raring to go on Sunday evenings because I have got new ideas for Monday mornings but Friday evenings I also want to switch off and I am like, you know wherever we are going out, I usually spend time with my team, we go out for drinks, Saturdays I am out racing, spending time with the family, so I think that equation and balance is very important.
Also, if you ask, I think you have to morph personally into newer things that you can contribute to within your business. So, if you continue to do the same thing, obviously even as an employees, people will get fatigued by doing the same thing but you have to get to every person’s core. If somebody’s core is, that he or she is an extremely right-brained person who is very creative, creative could be in any form, it doesn’t have to be making a painting or writing music or playing music or composing music or directing a film, it could be creative in finding newer solutions for your customers by doing new things, if within the company, by bringing up exciting, new ideas to life and executing them. Well, everybody has great ideas and then it’s about execution, so surrounding yourself with the smartest, best team or probably smarter than you and more competent.
For me, I think, you know a lot has changed. There have been phases in my life, the phase that I am going through currently is succession planning not because I want to exit but I am saying, this has been going through a while: how can I make the next set of leaders in the company and what are the things that I can do for them to create the next set of leaders. What is it that I can do for our customers that they love and find us even more endearing? Is there more value that we can add to their lives in some form or function? What is the value that I can add to my shareholders apart from just value creation, economically? Certainly with our employees… so to give you an example on the internal stuff that we do, BookMyShow has been running a medical program, we take care of mediclaim outside of your CTC for every single employee in the company including their spouse and two children and a set of parents, full medical expenses covered.
Ashish: Yes. We also, from this year have started pure term life insurance, no coping. Pure life insurance for every single employee. Now, lot of people wash their hands off, housekeeping staff, janitors, bais, maids, peons because they are outsourced on somebody’s else’s, we don’t do that, we take ownership for everybody. For example, we run a food program in the company not to retain company so that they don’t go out but to offer a balanced meal to the people who cannot afford it. In India, I realised that some of our staff, the reason why they are so slim is not because they are jogging, running but because they don’t have enough nutrition and so we pay a premium, most of us in the company and we subsidise, each of us subsidises for a lot of the socio-economically challenged, the economically challenged folks in our company where they pay only Rs 20 for the same buffet, the same meal, sit on the same table, eat at the same time even before we – have no differentiation, it’s the same cafeteria across our offices and we eat the same meal which is two non-veg items a week, thrice a week it’s full veg but it’s got salad, dal, roti, lassi, you have got nimbu paani, it’s a full balanced meal.
What’s important to note is that anything given free in life is not valued, so we charge those people Rs 20 which is the cost of two vada paos, the day vada pao becomes Rs 15 each, we will charge Rs 30 but at Rs 20 they are getting value of a meal which is about 85 bucks or 90 bucks, so that’s another way of giving back.
The third thing that we do, is that we run a voluntary program within the company where we contribute money, voluntarily and there is a committee of three which chooses that money as they feel fit. So three of our office boys are going through night college, English medium. So we are saying, that his kids can become an office boy, nothing wrong with it, there’s dignity of labor but we are saying, can we take them to the next level, the next playing field otherwise they are in a vicious cycle stuck where big expenses like marriage, health care, education, death, it wipes off their entire income or collections or wealth creations and they are always in debt, so how do you make them debt free? And to make sure that the office boy’s child doesn’t become an office boy and there’s more meaning, so can we educate them? Then two of our staff members, there was water that was leaking into someone’s home in the slum and one of our office boy’s roof was leaking. So, from this one we funded that program and it was a zero interest loan to be paid back in 18 months but when we saw them go down for the money for six months, we wrote off the one year payment.
Also from a philosophy, we have no segregation of toilets, there’s no executive and regular toilets or our staff doesn’t have to go on common toilets on floors outside. See there is something you have to realise that shit smells the same and there’s no differentiation and most people don’t realise that shit is the same, so when you open the sewer, rich man’s shit or poor man’s shit, socio-economically or caste shit, shit is shit, woh same colour hai, same smell aayega (it’s the same colour, it will be of the same smell), may be the guy who is rich, his crap will smell even worse because he has eaten crap, right?1 So how can you differentiate? Ghar pe kutta hoga, apne quilt pe (if there’s a dog at home and he is on your quilt).. you know ‘tommy come, get into the quilt and you will play with him on your bed’ but it’s another human, you will not allow him to use the same toilets.
I am a first generation businessman, I built this company myself, I cannot sleep at night if I have differentiated toilets. So, we teach personal hygiene to every staff member whether it’s a janitor, maid, bai, peon, whoever or an executive vice president… and whether it’s the toilet paper whether it’s with paper napkins whether it’s with wetting that area, everybody is taught in a very human manner but everybody uses the same toilet. There’s one toilet here in this office where we are sitting, everybody uses the same and it’s clean, it’s hygienic.
Ashish: And finally, you know I am not a very religious person. I haven’t been to a temple in 30 years except for, of course, architectural reasons. I don’t believe in that. You know, I think you are known by your karma and by the deeds that you do, I find it odd that on Mahashivratri, there are women pouring one litre of milk on Shiva’s ling when there’s a child outside who’s not got nutrition and needs food but andar jaa kar doodh doge par usko nahin doge (but you will pour the milk inside but will not feed the child). This country is mad. You will feed a cow outside but you will not feed another human being, I mean it’s bizarre, right?!
So, my theory in this was, if you look at Krishna’s discourse to Arjuna on the battlefield, basically Krishna was a cheat, he kept the sun up, he told him Karan’s weak spot, he actually changed the rules of the game, he set the rules and then changed them to give an advantage to Arjun and so it was the battle of good versus evil and the end was important not the means. All the means were wrong for the right end.
I actually taken a leaf out of that. With BookASmile which is something I am incredibly proud of within the company and everybody whole-heartedly supports that, is that we charge one rupee per ticket and actually it should be an opt-in but we have got an opt-out. It should be an opt in, it should be at the choice of the consumer but most Indian don’t realise that they are not opting out and we collect one, one rupee which runs into some significant contribution that comes in and without knowing, for our end-users we are building good karma for them. We send a double amputee to the Pan Am games and he won the silver medal. We support the Yuva girls in Jharkhand for soccer, in Dharavi, we have Just for Kicks, we support them, we take the janitorial and cleaning staff to watch an IPL or an ISL game because they are only cleaning toilets but they never end up seeing the game. We take kids from municipal schools and run art programs, we have under BookASmile, we run music programs, we take kids from underprivileged backgrounds to various games.
Recently, you know, we had that Coldplay concert and we had Music Masti from Delhi send us kids which we paid for and took them and put them on stage. We had Salman Khan without any PR come in for one of his movie launches where these kids were made to watch a movie at PVR, which supports us in this program. In the last six months, we have impacted 35,000 lives and I don’t know how many tens of thousands of lives we impact since the inception of this program, for me really the kick in life and my creativity and my metrics in life have changed. So, when you speak about fatigue, you have to keep evolving as a person, to be able to change that goal post for yourself. If my goal post and my metric are going to be, ‘Hey listen, I need to make so much money and I need to deliver so much profits and this is the valuation of the company’, this value creation that we are doing to employees, to society at large is far greater than any numeric value that you can give in a pink paper to an investor.
So, I think my goal posts have changed. The objectives and the goals of the company and most people in the company buy into this because they recognise what we are doing or what we are about and, therefore, the obsession with competition and all completely eradicates, it changes. We are doing something and nature will protect us. Nature will protect us with the karma we are building. Whatever gets thrown at us, there will be a protection layer around us.
Pankaj: Before I sign off, you come across clearly as someone very inspired and full of energy and the kind of stuff that you keep yourself busy, you know kind of settles the fatigue question very well but entrepreneurship is also about gloom at different points in time. Are there moments of failure? And what is that side of entrepreneurship?
Ashish: I have two things to talk to you about that. I don’t look at it as failure, I look at it as learnings because if your quality of input is high and you have studied well for your math paper and you still failed, you tried but failure in that was a learning. So you tried, you couldn’t do it but it didn’t mean that you failed, you learnt something from it. When the dotcom bust happened in 2002 which, I went from 150 people down to six including an office boy called Bajrang and I had to look at 144 people in the eye near the Shivaji Park because I didn’t have the money to take them to a conference room and I had sold them a dream to follow me as an entrepreneur. They had left jobs and come to me and now two years down the line I was looking them in the eye and saying, ‘Look, the dream is over’ and I can’t afford to pay you, But then I fought for them to get a severance package which helped me in good stead today because few of those folks today work for us, back again and a large number of them are placed in various entertainment businesses which give business back to us. So, it was about karma. I think there’s a learning in everything that doesn’t mean that we have not tripped or had speed breakers or fallen but that doesn’t mean that we have failed, we have learnt something and if you don’t learn from failures or where you trip or fall then you are stupid.
In terms of the gloom and how do I look at life: look, the pessimist will say, a glass is half empty and an optimist will say, a glass is half full. As an entrepreneur, I don’t have an option to say it’s half empty or half full. I look at that half empty section and I said, ‘there’s enough space for scotch’, so I add scotch, do that half empty. Now only two things will happen, either you will enjoy the best goddamn drink of your life and have a great time or you will be too drunk to care, that’s what entrepreneurship is.
Pankaj: So well put, Ashish, in your trademark style. Thank you so much. I really enjoyed this conversation.
Pankaj: Godspeed. Thank you.
(Kanika Berry has a Masters in Business Administration and has been a communications specialist for over eight years.)
Subscribe to FactorDaily
Our daily brief keeps thousands of readers ahead of the curve. More signals, less noise.
Disclosure: FactorDaily is owned by SourceCode Media, which counts Accel Partners, Blume Ventures, Vijay Shekhar Sharma, Jay Vijayan and Girish Mathrubootham among its investors. Accel Partners and Blume Ventures are venture capital firms with investments in several companies. Vijay Shekhar Sharma is the founder of Paytm. Jay Vijayan and Girish Mathrubootham are entrepreneurs and angel investors. None of FactorDaily’s investors has any influence on its reporting about India’s technology and startup ecosystem.