Blogging after a long time. Just came across the news that Zomato has got a Series D round . All sounds very good. But, it leads me back to a conversation I had with a co-founder of a very respected company in Hyderabad yesterday.
We were discussing, that India needs it's consumer stories. To go back into history a little bit, Since, 1980's most of the companies had a DNS which was B2B focussed. So, IBM ruled the Market. Vinod Khosla started Sun microsystems, spent lots of time convincing CEOs and finally created Sun microsystems.
Even Microsoft was an accidental B2C company. They did create the PC revolution, but their real DNA became, the deals they signed up with PC manufacturers to make Windows 95 the primary operating system. Ofcourse, we were learning UNIX in college.
In my opinion, the real B2C Internet entrepreneur was Sabeer Bhatia. He actually fought Microsoft and ended up, beating him in the tussle. Hotmail anyone ?
Of course, the new Millennium has been a series of Consumer stories. The Google's and the Facebook's rule. and Twitter has made excellent beginning. Yahoo seems to be rejuvenating itself courtesy Marissa Mayer.
So, In this context Zomato is doing excellently. They have targetted the right Market. Their alexa rank is 222 in India and 18,000 worldwide. So, what is the issue? For one, I'm a little confused by their spending patterns. They're official food partner for Masterchef, a blue chip program of star world.
But, fundamentally, I don't know, what is their DNA. They started off as a B2C company. Then, somewhere, they started selling tickets of events in the New year season. In between some disgruntled employees left and one blasted them in quora. And, now, A new round of funding has been raised.
There was a controversy or two around a restaurant in Delhi, which essentially got them traffic. In the initial days, they did have a spat with burp about stealing data from their site.
My feeling is, with the kind of numbers they have in terms if users, their revenues should be seriously high. Their Ads don't really inspire confidence.
But, at the core it looks like, the company is doing too many things. which was not what the founders would've visioned initially. Or, did they? Who knows?
Here is what, I would've done. Build a userbase. start with ads. But, dont solicit ads yourself. Create a network, which will handle the middleman's work. Then, the ads come in via external players.
You remain focused on your own DNA. Food and more food. Not getting a restaurant to sign up for you.
The same thing with events. Don't build your own ticketing system. Don't create your own marketing team. Just provide the users. Let the grind be done by someone else. Ofcourse, your margins will go down. But, longterm you will create an ecosystem, not a conglomerate. Today, none of the providers like you. Is this what you want ?
You can be a Billion dollar company. Just study how google and facebook have worked. Start thinking big, but, not conventional big. Your DNA is your own product, not the sales and marketing. Let someone else do that. You provide the users. Build a food ecosystem.
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