Category: Frontiernxt

This is a post that should have been made a while ago, but, as the saying goes, “better late than never”.

Market Vision is the first proper full blown product that I am building as the first step towards realizing the vision behind Frontiernxt. The aim with Market Vision is to engineer fine product experiences in the financial domain and the website is the beginning of what is, hopefully, going to be a great journey. The market for what we are looking to do is big enough, but it also comes with the challenge of being extremely fragmented. This is not a segment that can yet support a big sized play and monetization is hard if you are going to play only for the consumer market.

Hopefully, by going on a more measured path we should be able to handle the challenges a lot better, but we have to learn and adapt constantly. This is already seen in the fact that we have had to change our business model twice along the way, even before we had launched. Some of the market segments we were hoping to exploit, on a closer examination, turned out to be areas with negligible growth prospects. I am glad we could do a course correction at this stage than later when it could have been much harder and costlier.

My partner in crime for the project is Deepak Shenoy, who has been in the financial domain for a while now and has a primary background in technology with the cherry on top of being a two-time entrepreneur. He is a well recognized voice in the financial community in India and he drives the core of the project. I got to know Deepak through Twitter and his blog and much to my good fortune he is someone who is a real pleasure to work with.

In the model that Frontiernxt looks to follow, I tend to keep an eye out for domain experts (in places other than technology) who can benefit from having with them an enabler in the internet domain. This can often be a dicey proposition if the fit is not right between the parties involved. There have been many half-starts, conversations etc before this and I can now see how important it is to find the right person/team to work with.

The website currently is very much a work in progress. It can even be called an alpha, but a start up that is at the stage we are it, labels are only of academic interest and there is a premium on sinking or swimming fast than to see how elegantly we can do it. We are focussing mostly on pushing out quality video and textual content at the moment; in the days to come we will sort out the various niggles in the user experience department.

Take a look around and let us know what you would like to see, what you don't like and even what you like about it.

The end of 2010 was quite a hectic affair for me. I was involved in a challenging build and a much-needed restructuring of the company at the same time. Eventually, the build ate up all of my time and I start 2011 having to work out a strong plan for what I want to do with Frontiernxt. Somewhere during the build I got off Twitter (I log in to read up once in a while, but rarely), disabled my Facebook account and shut down my many other distractions. I have done something similar a while ago, but nothing that has lasted this long a period of time.

When I reviewed the past two years, what I discovered was that most of my problems could be easily interpreted through three things:

1. Clarity: How clear are you about what you are doing. It may mean five different things a couple of years down the line, but what does it mean right now?

2. Execution: How well can you execute on the clear vision/idea that you have.

3. Closure: One you start building/planning something, finish/close it.

Looking back, I see way too my unclear ideas, things half-built and products that were not completed. There is only one underlying theme to 2011 – which is to change all of that.

2010 has been both phenomenal and difficult, or, in some aspects at least, phenomenally difficult. When I left Network 18 two years ago I did not have too great an idea as to what I wanted to do. There were a few concepts, ideas and then some, but there was nothing concrete. If anything, the two years have been a continuing education. It has made me realize how little I knew beyond the tiny niches that I had specialized in. Within a big company, then term 'generalist' is easy to don, outside it, knowing a bit about a lot of things just don't make you one of those. You have to know your stuff and know it well.

To be honest, it has not been a struggle financially. Yes, it is not as lucrative as it would have been if I was still with a big company, but I had tracked and anticipated my expenses well and did maintain a very good balance. Where I did struggle was with having a definite purpose. There was no coherent whole in everything that I was doing that aligned well with an overwhelming desire to do something substantial. In short it was pretty OK, but it was also all over the place.

A month ago that scenario finally changed. It has been written about in a previous post, so I won't go into that again. The formal switchover should happen early January 2010. I am pretty excited to finally have this direction in place and can't wait to get going.

The personal angle aside, 2010 has been an interesting year for the domain that I do most of my work in. We had yet another year of looking eagerly at the unrealized potential in a lot of segments – mobile, e-commerce, broadband and media. While a lot of the early excesses have now thankfully been curtailed, most of the above mentioned segments don't seem to have a strong story behind them. Mobile has the strongest revenue aspect going for it but it has plateaued, broadband is a mess and media – well – the less said about it the better. I can't really look at any significant event – save the listing of Makemytrip.com – from the year.

I could, though, call Android as a significant event, but that story is just getting started. The amount of momentum behind the platform is incredible and the key factor is that even though it may not be worthy in terms of an user experience comparison with the iPhone, if you are switching from one of the other platforms, it is a significantly better offering at a substantially lower price point compared to Apple's flagship phone. For most users in countries with a massive population, the iPhone is priced out of their reach. As the process of building Android devices gets easier and simpler over time the platform will only take off even further from here.

Which brings me to Google – a company that is seriously underrated for how good they are. I can imagine them actually not being too put off by a lot of the negative press about being a one-trick-pony. It affords them a bit more of wriggle room as they come under increasing scrutiny from a variety of bodies. While they are often portrayed as a sort of Alice in wonderland for geeks, a slightly drier look at the company would show them as quite calculating and precise. I can't imagine the romance going forever for Google, but it is a certain bet that 2011 won't see the end of it.

Then there is the 500-million member social gorilla called Facebook. 2010 was the year when they dominated the airwaves along with Apple and Google. I am still not sold on the opportunity size for the company and I think the second market valuation is hugely inflated due to investors who want to buy in (still a reasonable bet to make good money on an IPO if you have deep enough pockets to participate in a round) and the fact that very little is actually known of the company's balance sheet, other than strategically leaked bits of positive information.

The problem for me with Facebook is simple. Without the audience there is little value in the product. I stopped logging in a month ago and disabled my account a almost two-weeks ago. I am yet to notice any major problems as a result of opting out. If I were to do the same thing with my primary Gmail account, all hell would break loose. Facebook is a massive time sink that generates a massive amount of junk data. I also have issues with the numbers that regularly get posted about Facebook. Strange thing is that Youtube is not too far away from Facebook in terms of traffic, but you would not value Youtube at $50 billion any day.

I think that by end of 2011 Facebook will have to present at least the first formal steps towards an IPO. I guess we have already seen this process being kicked off with a more polished and suave Zuck in the public appearances. I may very well be proven wrong about this, but Facebook will have a very Digg-like situation if they don't do the IPO jig by 2012.

AOL/Yahoo!: I am still holding out on the assumption that Carol Bartz knows what she is doing. Even though everyone is aghast at the relentless 'sunsetting' that has been making its way through the product line, the fact is that Yahoo! is a horribly inefficient set up. You won't realize the extent of this until you have worked with the company (we were a syndication partner at Network18) and the mess that their Indian operations are just a reflection of their global mess.

At the same time, I won't hold that assumption for any longer than end of 2011. Three years should be enough to restructure a ship even the size of Yahoo! and it is necessary to see some real hints about the direction beyond the usual corporate gibberish. I do get the feeling though that Bartz has a limited timeframe to do what she is trying to do – failing which she will probably be pushed into looking at a sale. I know it does not entirely make sense, but I guess the game is to cut flab, show real results, shore up valuation and go for the sale if the direction dance fails to find its steps.

AOL – the less said about it the better. It has an all too familiar smell about it now. A stellar 'narrative' backed by really no great connection to reality. I was willing to give Tim Armstrong a bit more of rope, but the recent acquisition of About.me brought back many strange memories. Trainwreck in slow motion from a company that has a dreary past in the M&A and restructuring world.

Twitter & the locationistas: Twitter has seriously disappointed me. I have previously defended the company and the direction in which they are headed, but it can no longer be done. They seem to really have the dog-chase-car-gets-car problem. It is a great platform with a very engaged audience, but they need revenues and strong growth in that to keep going. They just seem to be making things up as they go along. Till the end of 2009 there was the anticipation of the product heading somewhere. 2010 was a case of a loss of that momentum for the product. Yes, they have strong growth in the user base, but that by itself is an useless metric to judge things by.

The locationistas are just plumbing and not products by itself. The only hope in this line of business seems to be an acquisition when the going is good. Honestly, I don't think any of the new companies have the legs to go it on their own. LinkedIn used to be a favourite on that front, but they seem to have stagnated more than anyone else. Groupon seems to be fun at the moment, but it is too early in the day to say if they can sustain the pace they are keeping now.

It looks pretty grim by those standards, so let me stop the doom and gloom and look at what would I like to see next year:

1. Some sense in broadband/3G pricing in India. The current levels are atrocious. ISPs/operators have to take a hit on the margins, else we will have another boring year.
2. A genuine location-based social network in India.
3. A better start up ecosystem in India.
4. An investor/VC to fund an online-only media website in India run by a handful of good journalists.
5. Television content on the net, without ads. I'll gladly pay a premium for this.

Have a great 2011!

After a very long and hard look at the past two years I have decided that the company needs to change focus and the mode of operation. At current revenues (or even at 10x) it will take me at least three years more to get this into a place where it can start doing what it was started to do. There is also the fact that between a small operation and a big operation the overlap in effort is about 80%. You wind up doing a lot of things in common in both approaches.

But, the crucial factor that swung the decision for me was the fact that technology is the wrong place to keep as your sole focus if you don't have core IP that has sustainable value. In other words, if you can't license or sell it as a unit (or units), the value you bring to the table is largely related only to the price of a service and other easily replaceable variables. And that end of the market is a tough place to play at as there will always be someone out there who will undercut you. What makes matters even tougher is that the buyers are not themselves aware of the finesse of what lies underneath as long as it looks reasonable on the surface.

For Frontiernxt, that is where I had always seen the opportunity – a degree of finesse that starts with what lies underneath and meld it with higher parts of the product/organization that need not be digital to start off with. If you are a shop that primarily addresses the 'under the hood' aspect, a failure to transition to an engagement at a higher level leads to competing with the bottom feeders. Thankfully, the existing clients are not people who operate on those terms, but a look at the prospective market place makes it clear that those are exceptions.

The technology market has become a lot more commoditized in the past two-years. This was something that was an advantage for me when I started the company two-years ago, but it is now slowly starting to be a problem than an advantage. Product builds are easier to do and the gap between being excellent and having only absolutely essential is narrowing at an alarming rate. Granted, not many are out there who can still pull it off with a great degree of finesse, but what I have seen is that the gap is narrowing at an alarming rate.

In practical terms what this means is a gradual withdrawal from doing builds for clients. For what I set out to do, I need to have conversations which happen at a level that start higher than pure play execution. This may mean changes in the structure of the company itself and creation of new partnerships to address the gaps in competencies that exist in trying to move higher up on the curve. The January review should be an interesting one to look out for.

So in the last ten days we shipped two plugins for Elgg (Sharedly, Updown), started work on a Drupal plugin and finished building out a content website that should be the first important step towards where we want to head to eventually as a company. 80% of the ongoing effort is still course correction – sorting out internal problems and refocussing energies and effort in the right direction. It will be another two months before we can actually devote majority of our effort into the core of what we want to do.

The code releases are not much, but it is something that is very important. In all the years that I have worked in the online domain, it has largely been a case of take and not much give. A significantly huge part of our industry has been built on open source and not many of us actually put back anything into the world that we took so much from. The Elgg modules are small steps to change that for us. Sharedly is an attempt at creating a social link sharing experience within Elgg, while Updown is a generic voting module that is used by Sharedly.

The first two years of running Frontiernxt were an experiment. It was more like an audacious experiment – to see if we can work the industry differently and work in it differently. From that perspective, things have been good. The company has paid its own way through doing work more or less on terms that it wanted to work at. But a lot of the internal systems and discipline has fallen by the wayside in the last 9-months and proving the basic hypothesis is only one half of the circle of success in an operation. We still don't have the other half – scale – in revenues or people as of yet. This is still largely a one-man operation and there are only a few exceptions in the world where that can be called a successful company.

So, the next six months I have to clean shop, scale up resources/revenue and move out of the experiment mode. Part of this is already in place. There is a lot of effort that is going into closing execution cycles than keep them clogging up the pipeline forever. But I have only started on it and the moment it is a major mountain that we have to scale. By the time the November update of this post comes up, it should give us a good idea of how much progress we have made on this front.

When I left the big company job in 2008 to start on my own, it was not the ideal scenario be venturing out. The global financial meltdown was well on its way and it was becoming increasingly clear that chasing the digital opportunity in India was going to be an uphill task. Now, about two years down the line from then, it has been an interesting experience to look at what all I've wanted to do and what all I have wound up doing.

Most of the time after I quit in 2008 was spent talking to various people across the ecosystem. I met other guys in the start up space, a bunch of investors, company heads etc to get a feel of how it all actually works at ground zero. It is one thing to have a 'feeling' about how it all works and entirely another to put that feeling to test in the real world.

Two things made this period even more difficult. 1) I am not a very social person. This is a considerable drawback when you are trying to run a business on your own. You can fake your way through it to an extent by putting your game face on, but that won't measure up much to someone who is a natural at it. 2) I have little natural inclination or an educational or family background in business. I had to learn most of what I know from scratch.

I tried poking around various product niches then – some of the ideas I came up with were pretty OK, others were beyond ridiculous. But I was willing to let go of my biases and prejudices (which I had in plenty) and give opportunities and ideas a decent shot. It did not take very long for the realization to dawn that the product space in India Digital is tiny, and very little of that was not easily replicable. Given enough money and/or persistence, anyone could be overrun.

The market itself was another problem. We are price sensitive to the point of absolute absurdity. Quite often, perception is a larger factor in ascertaining a justifiable cost than actual benefit. Customers are often willing to accept a lower value/quality product at a higher price point from a behemoth than a higher value/quality product at a much lower price point.

Then came the bugbear of the opportunity size. The one billion-strong Indian opportunity is absolute bunk. It exists only in the imagination of outlandish product pitches and investors who want to buy into it. Spare a Naukri, most other larger players are nothing but marketing-driven plays. They acquire customers at a significant costs and then attempt to outlast the competition. Deep pockets ki jai ho!

There is a reasonable opportunity in India in terms of execution, which has been demonstrated well enough by companies like Flipkart, but it still needs a pretty significant chunk of cash to be put into the system before you can get going. Which was my greatest problem – how could I actually go about financing all of these things that I wanted to do?

When I looked at my own concepts, I did not feel there was anything concrete there that deserved to be funded. I would not have invested in myself. Hunches are nice, but they don't make a business plan and I did not want to misrepresent or inflate the picture I had in mind and con someone into putting up the cash to fund what could rightly be called indulgences. Thus started the story about 'building websites'.

What I was sure of by then was that we could not aim for anything at scale for a while to come and our main source of income had to be something else than the products we were looking to build. The only place where that was possible was in the service-oriented niche. Even there things were not easy. Even though there is an ever-growing opportunity for vendors who service the online space, the market is an absolutely crazy one.

To compete in this market requires you to fight both the vendors who will get business by driving down prices to levels that are unimaginable and the big ticket guy whose pricing is 80% the brand and nothing else. Because of this I decided to give the 'site building' market a miss and aimed instead to build upon something that is a lot more nascent, with the market being at least two-years away from bringing on the pricing massacre in that niche.

In retrospect, it is easy to claim our tryst with Elgg, the social networking platform, was well thought out and a logical conclusion. The reality was that we actually stumbled on to it by accident. A project we took on had the requirement of the particular platform and over time we became really good at using it. It made sense to build on our expertise in the platform and earn our bread and butter from it, which is what we have been doing for a year now.

This has enabled us to incubate about three different products at the same time, all of which are in different stages of development (or disarray, considering the shape some of them are in) and it is an act of will and gymnastics at times to pull all of this together at the same time. It could probably be a lot easier to fast track all of this by focussing more on 'building websites', but I am still very averse to that. Even though, when asked what do you do, I find it to be the easiest answer to give others.

The coming year will be a hard one. Like every small scale venture that reaches the level where it can sustain itself, I also find myself in a situation where it is imperative to go for broke or be happy being the tiny tot. It has become near-impossible to scale this any further with existing resources, but that also does not mean that we have the liberty to go on a spending spree. Much of our edge is in how lean we are and I don't want to compromise on that – yet.

One of the greatest learnings of these two years has also been the importance of picking the right people to work with. This extends to not just partners and employees, but also to the customers you choose to work with. A good customer who works with you is well worth forgoing two who will make your life miserable. The same goes for partners and employees. Choose them wisely.

Six months down the line I will revisit this post and do an update on how far we have progressed by then. It has been such a journey that I can't even make any predictions about where we will be by then. 90% of what I am doing right now is not something that I had planned. How I wanted to go about doing it is probably the only consistent bit in it and six months down the line I think the story is likely to remain the same.