Building scalable vertical social communities
In today's episode, Ayush Chamaria, Associate VP, along with Vipul Allawadhi,Co-Founder, Kutumb and Prashant Sachan, Founder and CEO, AppsForBharat, deep dive intovertical social communities
1.We at Matrix India are big believers of the vertical social communities opportunity in India. With more people coming/transacting online, bunch of offline behaviours are moving online and vertical communities are getting deeper, thus necessitating the need for a vertical platform to service their requirements
2.Identifying the idea -
a.Bunch of offline behaviours are moving online/can move online; essential to identify spaces exhibiting deep engagement behaviour
b. Large horizontals are generic and unable to replicate the exact offline behaviour online thus creating the need for a vertical social community
c.Stay very close to users/consumers – Best ideas often come out from the customers themselves
3. Best set of early customers are those who deeply resonate with the problem – They will deeply engage with the app and provide the right early feedback. Identify the behaviour they relate to the most, put the early product out in the market, get this set of users to try out the app and iterate basis feedback
4. Navigating the 0-1 journey -
a. Keep biases aside and stay very close to the early customers - Talk to them regularly to identify what is working and what is not working and accordingly iterate quickly
b. Being retention first (vs growth) - Focusing on a high frequency use case, good initial retention (D1/D7/D30) and noticing early signs of user habit building and recall is essential
5. Identifying PMF -
a. Early customer love – Gets reflected via positive customer feedback and virality (often comes in the form of customer gratitude)
b. Early retention and engagement metrics meeting benchmarks
c. Signs of habit formation – L-ness curves are a very good indicator for the same
6. Essential to hire for skills that the founding team doesn’t have in the early days. No one-size fits all - Approach could be to hire generalists first then specialists or vice versa basis the idea/requirements
7. Scaling the business – Core focus continues to remain the same and founders keep adding layers to it as the business grows. Essential to not lose sight of the initial goal as the platform scales
8. Monetisation –
a. Don’t rush into monetisation - Best time to monetise is when the need is coming from the users directly (Users say “Can you do this for us – We are happy to pay”)!
b. Monetisation should complement/add to the existing user journey – Approach (Ads/services/products) can/will vary basis what the platform is trying to achieve
9. Advice for potential founders:
a. Do not chase market sentiments and play the long game – Pick something that you are really excited about
b. Fix the fundamentals and solve first principles – Solve for the unknowns first
c. Pick a great team/partner (Mentors/VCs) who play the long game with you
Ayush:
Hello everyone and welcome to another episode of Matrix Moments, this is Ayush Chamaria. And today we plan to do a deep dive of vertical social communities. Globally we have seen a lot of communities emerge across different verticals such as Strava for sports, Nextdoor for hyper local and Fandom for fan engagement. In India with more people coming online, transacting online, lot of offline behaviors moving online we’re seeing early signs of erstwhile niche communities becoming deep whose needs are so specific that they require a dedicated platform to address them, something that the larger horizontals cannot do.
In this session we plan to deep dive into vertical social communities, cover potential opportunities and pitfalls into developing those communities and for prospective founders find ways to think about how to identify the right problems, how to identify the right customers, how to think about PMF etc. Joining me for this session are founders of two of the topmost vertical social communities in India today. One, we have Mr. Prashant Sachan, he’s the CEO of Apps for Bharat also known for the app Sri Mandir. They’re building the largest devotion tech platform in India.
Besides that we also have Vipul, he’s the founder of Kutumb, Kutumb is building India’s largest language community, today hosting communities of more than ten Indian languages. I have been personally fortunate to know them for a while now. We at Matrix have been fortunate to partner with Prashant for the past year or so since their series A. Vipul and I in fact go even long back, we were batch mates at our undergrad college, right? So, thank you so much, guys, for joining us. Really appreciate you taking the time and with this let’s dive in.
Prashant:
Awesome.
Ayush:
So, Prashant, maybe I’ll start with you. So a big question that we hear from all the founders and hear from everyone how do you really identify the problem, how do you really identify the need gap. Something that you did at Apps for Bharat, I mean devotion being such a large market but a bunch of it existing offline, so many different social media platforms catering to some needs or the other. Why did you think that a vertical platform is needed and how did you go about identifying the problem?
Prashant:
For sure. I’ll give you a bit of a background for you to be able to understand why we went about this particular problem statement. Now I’ve been observing the India story play out for a decade now ever since I was in college. Now we would realize that everything has moved online, from your wallets to you playing cricket in your gully to now playing cricket on a phone and almost every behavior has moved online and I was enamored by how this phone has become a very important space in people’s life.
Now prior to Apps for Bharat I was building another company and I was always thinking about what is it that is large enough behavior and hasn’t really moved online yet. Now I come from a family of farmers from Kanpur and this is one behavior which is the devotion needs and how people fulfill them as a very, very important behavior or practices that are at the core of people’s life. And this was something that was always at the back of my mind and while building my previous company while I was building that I kept on thinking about is there something and like an entrepreneur does I was thinking about what is it that the user’s might be which is still not there.
And over the course of many interactions I started thinking seriously about devotion should also move online. Now many other learnings happened in the past where I started thinking more deeply about the space, now one of the learnings was I realized about myself that I'm somebody who likes building for engagement driven platforms. Now I think of any platform in two ways, one is where transaction is the core action and another one is where engagement is the core action where everything else follows.
And I started thinking about when it comes to any of these engagement platforms what the key levers are. And I realized any legendary company engagement first space had these three important levers which is they were able to crack very high quality retention, they were having a very high frequency use case and there was a strong habit formation. So then I put this lens and started thinking about if devotion were to move online what is it that should be done. And then we ran a few experiments and one of the ideas that stood out was this.
So for us we identified that this behavior should move online and then we had a methodical approach to understand what is that one hook or two hooks that we should build for and that’s how the journey started. So one was this personal bias to this observation of behaviors moving online through this methodical approach where we saw that hey, let’s try something and that's how we were able to do what we’re trying to do.
Ayush:
Excellent. Very good. Moving on to you, Vipul, I know since the day you started the first question or the only question that everybody asked you starting from investors to operators was communities exist on Facebook groups, communities exist on Whatsapp, communities exist on Telegram, why are you building a new platform, what is even the need for it.
Vipul:
Yeah, and I’ll take this story a little back, so I think all four of us co-founders we were looking at our company called Pratilipi prior to this. So we were in the consumer internet space per se and more importantly also very much familiar with the tier 2, tier 3 user persona that we’re solving for. So that was really the genesis of solving for this particular persona and having a comfort in the space that's where we wanted to sort of startup. So that was the first thing that we started with.
Besides that I think the general idea of starting up was on our minds since long and what we were doing is we were essentially testing out a lot of ideas, right, it wasn't very thesis driven to start with, it was more about just talking to users, trying to understand what do they do in their day to day life and finding out white spaces within that. So it was just one of these ideas that we were researching upon and talking to a couple of users and at the end of it we would generally ask our users that we’re a team of software developers and what else we can help you with.
So there’s this particular thing sort of popped up couple of times that can you make an app for my community. So that got us all awestruck, right, as to the question that you had that these platform already exist, why is this person asking for a separate app for their community. So that got us very curious and then back of the mind obviously coming from tier 2, tier 3 backgrounds ourselves we had a very good understanding of how community as a concept is very much deep rooted into the Indian society more so in tier 2, tier 3.
So given all of that context we started to delve more deep into it trying to understand why are the existing platforms not able to solve the problems that these people are actually looking to solve for themselves and that’s where it all started.
Now coming back to your question, original question, which is about why were these platforms actually not being able to solve some of these problems so I think it all boils down to being very, very specific to the needs of these particular communities. So most of the communities when we started were offline communities that had a very different offline behavior to start with and as a method of ease to get online what they wanted was that those behaviors should ideally be replicated on to something that they wanted to get started online too. So existing platforms be it let’s say Whatsapp groups, Facebook groups, Telegram and so on they were very, very generic in nature and were not able to relicate those behaviors online.
Just to give you an example some of these people have a very organized community wherein they have a set of members in the community who hold different positions within the community. Now this as a concept they would want to show it up so assume that they were to develop a website of their own they would put these names on the contact us page or the team page of their website. So that is something that they wanted that the app should also be able to do for them. This is just one of the many examples but it’s essentially getting deeper into the specific needs of the particular communities that we were working with in the initial set and being able to solve very, very deeply for them I think that's where it all started.
Ayush:
Very interesting. So if I were to just summarize the overarching theme here is that a lot of behaviors that are currently existing offline have to move online or wanted to move online and both of you played on that thread that okay, while there are different platforms that are probably catering to this in some form or the other there’s no one dedicated platform that is bringing the entire thing on to that platform.
Prashant:
I think one interesting point here that people also mentioned was this that existing platforms were not catering to that specific need in a well-rounded way. So for example in our case a devotion is already people go to a YouTube or a Facebook group or a Whatsapp group to do this but think about this, right, if you go to a YouTube and you are in this frame of mind that hey, I have to now listen to let’s say some chialisa orbhajan and in between there’s an ad. So for some of these behaviors we need this designation space to conduct those practices. And hence the need of a new platform which gives you that space where you walk in and you connect in a certain way.
Ayush:
Interesting. Okay. So having identified the idea, having identified that okay, there’s a need for a vertical community let us build that. How did you go about identifying the first set of customers, I mean you knew that okay, we need to move devotion online, we need to build communities, how did you identify your first 100 users, okay, these are the set of users that I want to target and how did you really target them, how did you really reach them, what was like the pitch that worked the best for both of you, I mean either of you if you want to take it?
Vipul:
Yeah, sure, and I’ll take that. So I think before even reaching out to the first set of customers to sort of onboard them to the platform the first step much, much before that was actually talking to these users to actually understand their pains. So that's where it actually starts wherein you start also recruiting some of those customers while you're talking to them to identify the needs very deeply trying to understand what are some of the alternatives that they’ve used to fulfill those needs and so on. While doing all of that you are in a way also recruiting those as your early customers.
So that's really what we did and for us the problem was twofold because community as a medium has to have two sided users, right, users who are consuming the content in the community or engaging in the community and there are admins or moderators who are running those communities. So we started with the user side of it as to why and how they feel the platform should be and we were talking to a lot of people on the user side but to your question how to recruit those early users is just by talking to users for the research and there will be a core set who you would feel is very, very excited about the idea and the pain for them is much more deep rooted. Those are probably the good set of early customers that you should engage with more and then have them try out your product very early on.
Ayush:
Got it. And in this, Prashant, maybe if you can take this, how broad or how narrow should a founder be. I mean if we see historically the growth of Facebook for example starting from a small dorm room in Howard focused on a small niche of customers, so whatever they call it PMF or whatever there and then they expanded. So as founders how broad or how narrow should one think of their initial customer set?
Prashant:
Yeah. I think it will depend on what are you solving for. So I’ll tell you how exactly we approached it. So we said that this time we’ll not bring in our biases in and we would look at all the existing offline behaviors, run a few experiments and see what can be translated as it is online. And we said this time we’ll not create a new behavior and we’ll see what people do in the offline world can be a pattern. So the first thing we did was we launched a few apps which essentially were some of those behaviors, I’ll talk about those behaviors now.
So let’s say one behavior is that people would want to read a panchang every single morning, another one would be let’s say think of I am someone who reads a lot of literature or there’s another user who would want to listen to something and so on. And the behavior in our case that we identified was there’s a shrine everywhere, at every single household, at a shop, in every single car dashboard and what not. Now there’s a virtual space can be a shrine or what not. These are four ideas that we started fiddling with and we said this time we would separate the two processes and those two processes are one is product building and product marketing.
So we said we would product build and would say if there’s a mass appeal to it what we’ll do is we’ll launch these apps, put a banner ad or put an ad on Facebook and see who all resonate with it so that’ll essentially do a selection of the people who’ll resonate with the idea and see when they come to the app how do they behave on that. So for us it was in this case was we launched these four apps one after another and what we did was we ran simple ads and we said let’s just by data understand what do these people need.
So the first set of feedback that we got was through data where we saw how is their initial journey, what they’re liking, what they’re not liking. What we in parallel did we started identifying the people who are liking the product and who are not liking the product and we started calling them. So the first set of sampling was done by running these ads, get those users in, see the extreme product lovers and people who don’t love it and call both of them and this is how we ran the whole process.
Now what we did was we put 2000 rupees per day as a spend and we got these 500-1000 users every single day and saw how they were using the product and in this case we did not go to specific people and call them up first primarily because when you speak to them, when you approach them, there might be a bias because you have reached out to them and told them that hey, use our product, we’re building this. We said let’s just build on this thesis and see if it works. And I would say this reverse approach that we tried this time sort of worked for us. instead of going to the users first we said let’s just put the product in the market and see adoption and then iterate so that's how we approached this time.
Ayush:
Got it. And this initial set of users that you reached out to spending 2000 where did you actually find them, did you discover them from some of the existing groups or how did you target that?
Prashant:
No, we just ran simple Facebook ads, for example the ad said that hey, set up a temple of Hanumanji on your phone, this is one ad. Another one is access Gita on your phone, then read daily panchang on your phone. So we were running these set of ads and see who were onboarding and there were simple twopager apps, three pager apps and so on. This is how we – so it was like we said that think about this, right, you open a shop in Indhra Nagar you put a large banner saying pet shop and see who all would come in.
Ayush:
Got it. Very interesting. So having identified the idea, identified the customers, onboarded some of the customers then probably starts your 0-1 journey. How did you think about doing that, during the entire process 0-1 journey how did you think about the different variables, right, in terms of how do you build the team, what should be the ideal marketing spend, ideal burn, what should be your different variables, what are the key metrics that we should focus on. Which are the key metrics that would make you sit and notice okay, aha, this is working. So how did you approach that?
Prashant:
So I think this time when we were building this company this was born out of this experiment pod in my previous startup. So we had limited resources so we had one PM, one data guy who was an intern and couple of devs and one intern designer. So we had these many resources and we had to play within that. So we said – and we had some marketing spend so we had these limited things that there were only these people that we can work with. Then there was this daily spend of 2000 rupees per day so the natural instinct was to that we should focus on the matrices and what is important to it. So our focus entirely was on this part, let’s build the product.
Like I said it was an engagement first app business so we said three things have to hold true, one is if it is not a high frequency use case it’s not going to work. Second one was we said at least the initial retention has to be good and let’s not worry about long term retention and we’ll solve long term retention. And the third part is what we said this particular behavior already exists in the offline world, it’s a strong habit, do we have some signs of habit formation here. So this is how we started approaching it, now the point is out of the first few experiments that we ran we very clearly looked at how is the day 1, primarily day 1 is the indicator of -- day1 retention is an indicator of whether there’s a national recall that is built in the product or not.
So then we looked at the first four, five days of usage, then we looked at recall. So the people who were using it we called them up and asked them what was their feeling when they use the app and accordingly we decided which one which app to pursue. Now my bias was that some of the apps should work that we tried but to our fortune the app that clearly stood out was this app which is called Sri Mandir today. Now we got all of these things right and then we kept on iterating on it, so the people who were the top quartile performers we kept on asking them that hey, what else should we add, what else should we add.
And we kept on aggregating everything in the app and that's how we iterated. So the first 6-7 months of the journey was just this process where we with this team and this marketing spend we kept on iterating and day on day, week on week we kept on improving our retention numbers. We identified the top quartile and looked at in a given week how many of them are using app on every single day and what not. So this is what our matric was and we just kept on chasing it. And this seven month of focus, eight month of focus gave us very, very good answer on what this might be.
Ayush:
Yes, Vipul.
Vipul:
So for us I think early on again there were obviously we didn’t have multiple ideas to start with, we were focusing on just one. But within that the problem was two sided, right, as I told earlier in community you have to solve for the people who are running those communities and then there are people who are joining and engaging with the community. So first we had to decide as to which one to solve for first. So our natural instinct on that was that and then it was slightly strategic as well is that for you to be able to solve for the admins who are basically running these communities in some shape and form offline and on other platforms as well the shift that they have to do the friction there is much higher versus for the end user who is consuming the content in the community whose engaging with the community the initial friction is much lower.
And so we thought we’ll solve the user side of it first and once we have solved on the user side it’s actually much easier to solve on the admin side as well because now you have users to give to those admins. So we started with the user side and we focused on just one community so Kutumb initially was just an app for a single community, it wasn't a platform per se. We started with a teachers community in Rajasthan so that's where we started to build, right, we put out ads on Facebook saying hey, this is an app for teacher in Rajasthan only, if you're a teacher in Rajasthan you can come and join this app. So once the users come in I think some of the things that Prashant already mentioned we were very, very focused on leading indicators be it in terms of do the users have recall on the app, how does the initial day 1, day 7 look like, are people actually engaging on the app or not, are they spending a few minutes of their time on the product on day 1 or not.
So initial focus was just to solve for this one particular persona keeping in 2-3 pillars as Prashant mentioned very much similar pillars that we were building on retention was the key focus. Habit building again we were looking at it from a long term perspective as long as you have the app installed in your phone and you’re opening it even let’s say after a couple of months even though your frequency is lower we were fine with it to start with, the reason being the use case that we were solving for in itself was not a daily use case at least very, very initially. We obviously wanted, it was a good thing to have but not a necessity for us but beyond that I think retention was super important and just being able to iterate to solve for retention was the key focus.
So the process there was to talk to users on a daily basis trying to understand what’s working for them and what’s not working for them. And the idea there was to focus more on what’s working and doubling down on that and filling, giving more of those features, working on those features, iterating very, very quickly. So to give you an example I think in the first 180 days, first six months or so we’d shift about 120 times on app start.
Ayush:
Wow.
Vipul:
So 180K per 1.5 days is what we did, so that's the real focus that we had, just get insights on a daily basis like we will put out at least midnight next day we will wake up we have some users, we’ll call them up right away trying to understand what they’re feeling about the product, next day we’re on to something new just iterating on that. So that's really what worked for us at least in the first six months or so. Next phase obviously was to then solve for admins and on the admin side once we had solved for the user side wherein we were seeing a good amount of retention, people were inviting other people in on to the product and so on. The value proposition on admin side became much clearer, the value proposition was very simple that hey, you bring your community here and we’ll bring you the users or rather those users will come on their own and engage.
And as an admin why would I not want that, right, so that became clear and then we started to iterate on the admin side of things, took a couple of months there as well. One specific instance that happened after a couple of iterations on the admin side is that one fine day we had one admin that we had onboarded very recently and that particular community from that admin just went viral and got us about 50,000 downloads in a day.
Ayush:
Wow.
Vipul:
And that was our sort of Eureka moment wherein we said hey, this is something that we’re definitely on to.
Ayush:
It’s working, yeah.
Vipul:
And we should double down, triple down on just this.
Ayush:
Wow. So broadly what I hear is two things in the 0-1 phase, one stay absolutely close to your customers, keep on hearing what your customer says because that is probably the best form of feedback that you're going to get and then iterate, improve the app with that. And second a lot of early founders face this conundrum, should we chase growth versus retention at least in the early phase. What I hear from you guys I think just chasing retention and ensuring that retention is sorted so that it does not really become a leaky bucket is really the key.
Next I think all the founders struggle with this magic word or the magic phase called product market fit. So I mean coming from both of you how did you guys think about it, when did you guys really think that, okay, we have probably achieved an early product market fit be it in terms of matrices, be it in terms of probably for you the virality of 50,000 users gave you an early think that okay have we found product market fit or this is our product market fit. So how did you guys think about product market fit that okay, once this is done we think we have achieved product market fit and how does a founder iterate towards getting to product market fit really.
Vipul:
So again as I said previously so for us product market fit meant I think two things majorly, one we should have at least some set of users for whom we’re solving very, very deeply and in terms of matrices that would reflect into retention, reflect into the engagements and so on. Second was having some scalable channel to actually reach out to more of such users. I mean if you can develop a product but then you don’t know how to reach out to those users you're still stuck. So I think these two things is what we were solving for and the idea there was again to iterate very, very quickly this is the feedback that we were getting from the customers.
Obviously looking at what else is happening outside on other platforms how some of the bigger companies have in their initial days approached the problem and so on helps but essentially if you were to point it out to just one thing that really worked and helped is staying close to the customer and iterating very quickly on the feedback that you get from those customers day in and day out.
Prashant:
I think for us how we actually approached this was in phases. The first phase was we said that if we have crazy good user love in the first 3-4 months where people are able to – they’re enamored by what you’ve created that's the first phase or super early phase sort of an indicator to PMF. So the first 4-5 months we were just looking at anyone who’s installing the app what is it that they’re saying. And there’s a practice that we follow in our company where we actually write down the thesis beforehand and we say that hey, if the user says some of these things we’re in a good place.
Now the magic that happened was that many of these users came back and they said such good things about the product where I’ve been trying to build apps over the last 8-9 years of my life now. And I’ve not seen – so user love is there to say this is a good app but when they give you gratitude for what you’ve built there’s a profound happiness, they’re thankful to what you have built. We said there is something which is clicking here so that user love was very, very deep. So there were reviews where people talked about them having negative thoughts, them feeling more stronger and what not.
And we realized that this is true to what devotion is in the current format, it gives you that fabric of hope that you tie closer to your body and you feel more stronger and what not in your good days, bad days and what not. So we said we have not seen this kind of feedback, if this feedback is coming our way there’s something in this, so that was the phase one of identifying that there is something in the product.
Phase two was where we said that hey, there is some retention benchmark in their head when having spent some time in this kind of game we understand that oh, what is a good day 1, day 7, day 30 and what not. We said let’s have a very objective approach and see do all users that you onboard with that banner that you show them what is the kind of behavior they’re showing. So we actually followed a reverse approach where you said that we’ll not segment users and say this percentage of users are loving the product, we’ll not say that, we’ll say all the users that we acquire are showing this kind of retention.
So we kept on optimizing on that and when we started seeing the numbers improving and getting to those benchmarks we said the early stage retention is solved. And a third phase was when we said do we have signs of habit formation, so we looked at these LS [phonetic] curves so when we look at 7 day LS curve and 30 day LS curve there was a significant portion of people. So for example in our L7/7 around 16 percent of the weekly active users were using the app on all days of the week. And around 10 percent of the monthly active users, 10 percent of L30/30 was a number when they were using the app on all days of the month.
And we were like this indicates that we’re on the right path and then we kept on iterating so basically we had defined these three phases, the first one was early user love, second was early retention and the third one is where we said that do some people showcase that mad behavior. And in all of this process we said we’ll always solve for demand, now what I mean by that is we said if the end game for us is hundred million people using it every single day we should see if a segment of them come to your app today and are their needs met. So we kept on focusing on that instead of everything else, we said that if you have to scrape some content and put in the platform and see if people would use it do that.
So whatever you need to do on the supply side it’s your problem, the demand side should be sorted. So that's how we approached and for the same reason we focused on creating a single player game or single player usage on the app and not multiplayer users because we understand that multiplayer usage would need many, many variables to solve. So we said that let’s just minimize our variables and kept on focusing on them and if you have signs of a very strong single player usage there are means in which you can take it to multi player and what not. So this is how we approached it, the first one year looked like this.
Ayush:
Very interesting. So I see this LS curve as one common thread connecting you both, right, because if I remember correctly even when Kutumb started early in the days there was a very strong focus on LS curves and for those who are hearing for the first time LS basically means an L5/L7 means out of seven days in a week how many used it for five days. So similarly for L4 means four days out of seven days, right. Yeah, very interesting.
Vipul:
One profound thing Prashant just mentioned, right, which is solving for the demand itself. So for us as well there was several instances wherein you get some feedback from some of your users which you never expected, which is out of your thesis but once the user asks for it you know you have to build it. And it does not matter whether it was on your plan or not whether that's on the supply side you have it or not and what not. So I think just focusing on what the users are asking and at that time even you felt like user are pulling the product out of you and that's where you know the early PMF is what you have.
Prashant:
Brilliant point. I think one thing which is what people said is what I totally concur with is you’re not creating it for you. So your job is to build for an audience and you should not be extremely particular about what your biases are. So hard learnings but in the first one year whatever feature that I was very biased to, ke ye tou work karna chaiye, wo nahe work kiya, and I was like – and that's when I and this is still my office, you know, where I have written keep your biases at home when you enter this office. So and this is a note to myself where we as creators have this strong creator complex we say that, ke ye tou asa he hona chaiye but audience totally amazes you. And our job is to build for them whatever it takes.
Ayush:
Correct. So as we call it being as outside in as possible. I mean that is the approach that really helps. For this stage, right, for 0-1 by the time you're approaching early PMF how should founders really think about team building because that is again one question that who should be my first hire, should we focus more on product, should we focus more on engineering, generating demand, generating supply, how did you guys think about it early team building.
Vipul:
So I think the first thing to look on that is that you hire for things that you don’t have within your founding team so in terms of skillsets that’s what obviously is what you should look for. But beyond that I think the focus was a lot more on hiring generalists than people in a very, very specific skillset and then I mean beyond just the surface of the word culture there is a lot of I think nuances, a lot of context around the kind of culture, the kind of product, the kind of team that you in yourselves are. So I mean hiring earlier team members in that sense is like a arranged marriage wherein there is a lot of context around which you cannot even put on paper.
So that's really what it is so a lot of focus just on who the right people for you as a team and for your context in the industry and stage are that's very important but beyond that I think hiring for skillsets that you yourself don’t have is obviously something that you should focus on and then hiring more generalist rather than focusing on specific skillset is something that we focused on and that has worked brilliantly for us wherein even if that person didn’t have that skillset but they were able to on first principle basis pick up that problem and actually solve it for us. So that has really, really worked and we’ve been on the other side wherein we’ve hired for specific skillsets in the early days that has certainly hasn’t worked for us so far.
Ayush:
Interesting.
Prashant:
I think this is where it become interesting, right, which is we had a slightly different approach to this where the first set of people that I wanted to hire was in finance where I said that when it comes to company building and there’s a lot of building that I’ve done so I feel companies evolve. Today we’re building a company which is building internet products but the first layer, second layer of the company remains the same. One is HR, second is finance. So I said everything else will change, get a very good finance person who can do everything around company building for you because that's what my core skillset is. So that's one hire that we did in the first 2-3 months a very good hire that we did in the first 2-3 months.
Then beyond that we said that we know what we would want to build but we would want to take a very, very data bank approach to be able to do build this. So we did not hire generalist in this case, for the first one year we hired specialists. So for example people with data jobs, PMs with data jobs and so on. So the idea was whoever you're building you have to give them very, very specific areas to go deep into because we had some strong indicators and we said for this year if we are able to crack this much we’ll be in good place. So we actually identified the pain areas and we kept people with deep focus on those and we said and what we told them was understand indicators and keep drilling down. So that's the kind of team we hired in the first days.
Now once we were able to get there that's when we got the generalists to the team, so we said that the first year would be more about chasing data and then once you understand where this would go to then you add these generalists who’ll do further problem solving. So that's how we approached and I think in a way it has worked fine for us where we – this thing primarily why we did was because we said because it’s such a relatable area everybody will come with their ideas that let’s do this, let’s do this, and also when we talk to like lot of people in the market they’ll always say that put this, this will work, put this, this will work. And we said that we’ll not listen to any one of them, we have our playground to play on, we’ll see what people will act on and we’ll keep on going in deeper. So that's the approach we followed this time.
Ayush:
Got it. So net, net there's no one size fits all approach but the founders need to be cognizant on what works best for the company and then go ahead with it.
Prashant:
I think one more team that we hired was the UX research team. So one was this whole – the other one was so we separated these two functions where we said that this team’s job is to do calling and I'm also let’s say I go on these calls and spend time every single day there’s a mark in my calendar so that's one set and there’s another set. So we pass on information from here to here but we somehow have kept them in parallel rather than intermingling and what not. so there’s a UX team which comes and brings insights and there’s a team whose job is to keep optimizing and their job is to understand what is going right and what is going wrong thematically.
Ayush:
Very interesting. Okay. So having discussed PMF what Avnish really calls it three stages of building a business, right, one there’s early PMF, second there’s scalable PMF and third there’s scalable profitable PMF. So having got a taste of early PMF, okay, this is what early PMF means once you start scaling or as you start chasing scalable PMF does the approach, does the way you look at the business, does the matrix that you look at or the team that you look at change and if yes how does that approach really change? Prashant, you want to take that.
Prashant:
Yeah, I’ll take that. So I think the core functions remain the same. So we have this – the whole org is in form of pods and every pod has very clear goals. Now I feel those pods remain the same, you might add a growth pod and you might add a monetization pod and what not with time but the core of the business essentially is the same. So we see it as a series of concentric circles for that matter, so the core remains same which is you have these 4-5 pods which are focusing on primarily engagement retention, initial usage, initial adoption and what not. And then let’s say and we understand that the business will not work if this core fails. So that's where we feel you have to keep focusing and what has happened historically is also as companies scale as they get more users this core often breaks, so especially in companies in ours like the engagement first games and what not, so we have kept the core intact.
And there’ll be like there’s a crazy focus that we constantly keep iterating and say that this should never break and this has to keep improving. And we have kept our parts high and so on, we’re working on that and then as the business scales for example in the first phase we said we’ll not focus on product marketing, we’ll just focus on product building. So till January we had one marketer and now we have built a social media marketing team, this team, that team and what not. Essentially we’re now building more modules on the second circle and similarly let’s say we have started some experiments on understanding the propensity to pay and what would people like to pay on without breaking their trust and what not, so these are the product we have built, so this is how we see the org.
Ayush:
Got it. I’ll come back to this monetization point given everybody struggles with this but, Vipul, we’d love to hear from you.
Vipul:
Yeah. As Prashant mentioned the core of the company obviously is something that is there to remain, so first being very deeply focused on that and then over time just making sure that the core remains and nourishes over time that's something that you have to definitely focus on. So for us I mean the product itself grew quite a lot in terms of the number of things that were there in the product, so what happened is that maintaining that core, being able to maintain not just build that core also became very, very important. So I think we had to put in a good amount of effort building analytics, building reporting, weekly, daily reporting and so on. If something breaks you should have somebody who’s responsible to look at it and so on. So just being able to maintain that core beyond just building it out so that's one thing that we had to focus on in some of the later days.
And then secondly as Prashant also mentioned, right, now given that that core is out there now you're building circles around it in terms of number of things that you want to focus more on. So he mentioned growth, similarly it could be monetization and something that he mentioned now that there are more people in the team you might also want to have a dedicated HR team who now make sure that the people are comfortable in the office environment and what not. So again to put it in a few words, right, so for the founders the core will remain the same, your focus will remain the same, but you will keep adding things to it. But you have to make sure that the initial focus or where the real business lies for you is something that you have to take into consideration.
Ayush:
Yeah, very interesting. So like I said just coming back to the monetization point, right, I mean I think all the founders building in the social space struggle with this in terms of when is the right time to actually go ahead and run monetization experiments, when is the right time to do it. So I know both of you are now doing it in some form or the other, so would love to hear how you guys approached it, how do you think when is the right time to think about monetization per se and how should founders’ perspective founders’ really go about it?
Prashant:
I’ll take this. So I think before monetization you have to think of user journey and when you can – so for example in a user journey you have to imagine a optimum flow of users in the app them using over a certain period of time and what not. If your monetization complements it then it is the right time to monetize, if it doesn’t then its ugly. Now when I look at monetization I see that hey, there’s a user who’s coming on the app he’s using it in a certain way, if the core usage is fulfilled and if monetization that you put as a service or whatever you're putting, right, is adding to that usage is the right time to think about monetization. So you’ve to think of it as is monetization adding to experience or is it depleting his experience on the app.
So for us we realized in single player mode or when we have launched multi player mode also where we’ve communities and what we’ve put together on the app we see that there’s a beautiful journey that is there on the app and we realized that can we create an additional flow which is which will not obstruct the earlier flows but it complements some of those flows or is an add on to that particular flow without breaking the user trust, user love, if this all adds up try monetizing.
Ayush:
Got it.
Prashant:
So for us we realized that and of course calling our users really, really helped so we were not thinking of monetizing all of this while – however some of the users called us and said that hey, can you do this for us where they said we trust you for this, this thing outside is totally broken, can you do this for us. And when that feedback became repetitive and there was a pattern we said let’s see what could be done here and accordingly we said that now let’s see if people will adopt and so on. That's how we thought about monetization, we said they asked for something and we said let’s just see if we can offer it without breaking the user love and trust. So we said let’s just put it together and see whether it makes sense, that's how we started and we’re still very, very early but for us that monetization essentially doesn’t break the user journey it complements it beautifully.
Vipul:
I think just to add to that the user journey piece of it, so if you were to think of YouTube as an example Super Chat is something that came in very, very recently, YouTube has been there for long. So the idea there I feel is that for something like Super Chat to work the connection between somebody who is running that channel and somebody who is paying for that Super Chat has to be very, very deep and will take its own course of time to actually build that equation in the first place. So it has to basically you have to basically start with the assumptions as to these are the things that are stopping me from monetizing as of today. And then you have to clear them out and you have to be honest on whether those are the fair assumptions to have, these are the real problems before we can actually monetize.
And once you are at that stage wherein those assumptions no longer hold true that's the right time to look at monetization.
Prashant:
I think there’s also one thing that we often miss out is what’s the theme of the platform, what that space that you’ve created virtually what it makes the user feel. For example in our case if a user is coming into the app you want him to have a certain frame of mind when he enters the space. Now for us something like ads will not work at all because the reason why you started was because you would want them to have a specific space where they would enjoy, have that joy and what not. So for us something like ads would not work so we have to think of services which will complement that existing space creation for them where they would feel nice and happy and what not.
So basically one thing which is also very, very important for us when we started doing it we said that hey, there are many ways to monetize a platform like this, what fits your theme and what doesn’t. We tried to build this very strong thesis of what we would not do or what we would never do. So that actually made our life easier where we knew that we would never do ads. So we said now how do you build a business and that's how the whole iteration process started.
Ayush:
Right. So net net again don’t rush into monetization, stay close to your customers, probably the best time is when the need for monetization comes from customers themselves, right, that okay this is one feature that I want and then you realize well, let me introduce. And key thing to keep in mind is that like you said, Prashant, it complements the user journey and does not make it lose the trust on the platform or mar the experience in some way or the other.
Prashant:
Absolutely.
Ayush:
Got it. Very interesting. Okay, so final question from my side, right, I mean either of you can take this. If you were to startup again – it could be across any spaces, I mean, be it media, social gaming, or any of the broad spectrum of spaces there. Which one would it be where you see one white space where a large company can get created again and if you were to startup again what would you do differently than what probably you have done in this journey, Prashant, you have done in your earlier journey.
Prashant:
Okay, I’ll take this. So one is my company’s name is First Principle Apps for Bharat. So I’ll still do that which is I’ll build First Principle Apps for Bharat but for maybe for a different problem statement. So coming from my hometown I’ve seen a lot of these problems that people have, I would pick some of them which I feel are large enough, would still doing that because I feel these people deserve better solutions whatever their problems are. So I would still go ahead and if not devotion would solve for any other problem that this audience would have.
And it comes to let’s say what I would do differently I would like to believe that I'm doing it right this time. I'm being very mindful with respect to – the good part is every startup is like a UST, it’s a crash course that you do in a few years of – so you do multiple programs in just one journey that you build. So I'm very thankful to my previous company for so many learnings that I’ve had so I'm just some of them were direct experience, some of them were learnings from my fellow founders where they told this is what worked what did not work. Just trying to balance all of that in this company and have certain principles on which I'm abiding by so I hope I’ll do it right.
Ayush:
Got it. Vipul?
Vipul:
So I think in terms of the spaces that feel interesting again obviously I still hope that I get to build what I'm building for a long, long time to come. So but beyond that I mean one of the spaces that I’ve been recently looking at is gaming for kids. So what has happened over past couple of years is that smart phone adoption obviously has gone up quite heavily and what happens at my home is that I see a lot of kids hopping on to those smart phones at a very early age. And gaming is obviously by its nature is very addictive and especially to the kids in their primative years. So building content and games for kids in their early years which are actually mindful of the long term repercussions on their psyche, on their overall development and what not I think that's one area that I will definitely want to look at.
And most recently if you see across different countries in the US, in the UK, even in China some of the regulations have also geared into this direction wherein they’ve limited the kind of content, the kind of apps that you can serve to kids and then the amount of time you can show it to them and so on. So that's bound to happen even in India so I think that's one area definitely I would want to look into.
Ayush:
Very interesting. Three pieces of advice that you’d want to give to upcoming founders as they build their own business having learnt from your own experiences?
Prashant:
Yeah, three is a lot.
Ayush:
One, whatever.
Prashant:
One is I would say do not chase market sentiments, what I’ve realized is it’s a long game that you play. I used to think that in 3-4 years we’ll have miracles coming your way and it doesn’t happen that way. It’s a long term commitment so the first thing that I would tell everyone is play the long game. And every single morning when you wake up that problem segment you're solving should actually give you so much of kick and excitement that if you keep chasing for the next 10-20 years of your life then only value creation will happen. So that is the first thing that I would tell to everyone. Do not chase market sentiment, you have to play the long game. Pick something that you're really excited about.
Second thing I would say is do not – you know, fix the fundamentals first. And do not get enamored by what people would tell you at various phases of your journey. So solve by the first principles, pick what is important to your company, what is important to your product and solve accordingly. I think these two are broad advices I have.
Third I would say pick a great team. You know, a team that I'm very fortunate to be honest. The people that we have who are building along with me I feel very fortunate, pure missionaries who feel that devotion should come online and they’re at it while I'm here, they’re at it with the same rigor so the third part is team. Pick the team which plays the long game with you, has the right fundamentals and heart in the right place and I think these three things and of course pick the right partners in terms of VCs also.
Vipul:
Okay, for me I think one of the key learnings have been to solve for I think what we call it is unknowns first, you know, things that are very, very unknown to you but could really make or break your business to start with. So solving for very, very heavy unknowns first rather than doing things that are pretty much done by hundreds of other people and then spending your time and energy building that out. That's just replicating something that other people have already done, so really, really identifying what are some of the key unknowns for whatever you're building to actually exist or not. So picking those out and focusing very, very heads down on that in few early days is definitely one thing that I would want to do.
Second, I think as Prashant rightly mentioned picking up a space that actually excites you to wake up every morning and be at it.
Ayush:
Yeah, very important.
Vipul:
Right, and there will be ups and downs while you're at it and at the times when things are not going well the only thing that actually keeps you going is your excitement for that space. So that's definitely important.
Third one, I think is picking along with the right team as Prashant added picking a right set of mentors to be around be it colleagues, your parallels, mentors from across the industry, different industries and what not. From different spheres but the idea is you should have a core circle of people that you can talk to any time of the day that you want to and whenever you have a you can pick up the phone and call them up to just brainstorm on things together. So that's also very, very important.
Ayush:
Got it. Excellent, guys, I think you’ve given us a lot of food for thought here both for us as well as for potential founders. I think we’ve been able to capture a lot more than what we hoped for so really, really thank you so much for taking out time for this. I know it takes a lot, each of us is keeping very, very busy. To take out time for something like this and share your words of wisdom, share your insights. Thank you very, very much, really appreciate it
Prashant:
Pleasure to be here. Thank you.
Vipul:
Thank you for having us.
