Today we are in a digital age where anyone, no matter how young or old they are, can start their own company and perhaps be successful. Some do this younger than others; but the two co-founders of India-based mobile ad network Vserv 1 left it a lot later. We recently spoke to one of them, co-founder and CTO Ashay Padwal, to hear his story of founding the company.
Primarily started as a mobile ad network for feature phones, today Vserv also caters to smartphones. The Indian company now processes 31 billion ad requests per month where nearly 14 percent of its traffic comes from Southeast Asia. The company has helped 20,000 apps monetize from its AppWrapper product, with a click rate of 10 percent. Besides taking care of the Southeast Asian market, the company is now aiming to penetrate the African and Latin American countries as well.
Family comes first
Co-founders Dippak Khurana and Ashay got started in unfortunate circumstances. Both of them lost their fathers at an early age, and being first-born sons they had to shoulder the responsibility of providing for their family first, before taking on any risky moves such as starting their own companies.
Ashay worked for 12 years as a company employee, while Dippak worked for 16 years; nine of which were spent working together at the same companies. The decision to partner up came from their professional experience and understanding during that time of working together.
By the time they were ready to start a company, they had not decided what kind of company they wanted to build, just that they wanted to build it together. After looking through their backgrounds of working in digital advertising and mobile, they decided to build Vserv as a mobile ad network company. Their first primary business model was to cater to feature phone users.
Convincing VCs amid fierce competition
During the time when Ashay and Dippak started Vserv in late 2009, they found out that the space was getting more crowded with competitors trying to fill in the same mobile ad niche. To grow and scale faster than their competitors, the team looked for investors to help fund their idea. But finding a VC that wanted to back a mobile ad network business for feature phones was very tough, especially because they thought that feature phones would disappear quickly thanks to the growth of smartphones. “Before we got the first round, we had gone through two to three meetings with each of over 30 VCs,” says Ashay.
In that respect, rather than discussing about business concepts, Ashay and Dippak was able to convince the VCs through real numbers and progress. Vserv was already earning revenue from the fourth month, and the team became cash-flow positive in its second year. Ashay said that his experience in running his previous (and failed) business also taught him how to approach the VCs too. At the moment, 75 percent of Vserv’s revenue still comes from feature phone platforms, with the rest coming from smartphones.
Will the feature phone market deplete rapidly in the coming years? Ashay doesn’t think so. He predicts that even in the coming two to three years, their revenue from feature phones will not be beaten by smartphone user-ship just yet. This is because there is growth even inside the feature phone industry with the emergence of “smarter dumb phones.” These phones, says Ashay, are not traditional candybar feature phones from ages ago, but touchscreen phones like the huge-selling Nokia Asha models.
In the end, one of the keys that differentiates Vserv from its competition is the company’s technology, according to Ashay. He knew that one of his competitors was growing pretty strongly too, but after they reached a certain level, it fell apart because the technology was not able to back up the growth. In this business, the ad technology must be able to identify a user’s profile quickly and put ads on their mobile device in seconds, and Vserv’s technology was able to cater its user growth.
So why did Ashay finally leave his high salary job to start his own company? He says that his passion is to create wealth. Wealth is much more than just money, but also to empower individuals with the skills they need to develop. He believes that starting his own company gives him much more freedom and power to do so, and he hopes that one day a lot of his employees will become entrepreneurs like him.