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Friday, August 27, 2010

The entrepreneur turns mobile

Saving On Time Proved To Be A Huge Business Opportunity For Mobicule.
artical PictureFor 30-year-old Siddharth Agarwal, the motivation to launch a start-up came by simply noticing one key trend in the large business enterprises in the country. 

“There is a certain way in which sales is done in India: the salesman goes to the store, receives the order and then comes back to the office to punch it. The time-lag is big. It struck me that this whole process can be simplified by using a mobile phone.”
For the computer science engineering graduate from the Sardar Patel College of Engineering in Mumbai, the mission was simple: to create a mobile application that would enable enterprises to streamline their sales process. With this in mind, he and his team in Mobicule worked together for six months to create Msales — their first product in the space.
“The product flow is quite simple. An application is installed onto a GPRS-enabled handset, which allows the sales person to make, update and cancel orders while he’s in the field, with the data shared with the sales back-office simultaneously,” he says.
Mr Agarwal’s experience at a start-up venture MyZus, incubated at IIT-Bombay, helped in working out this idea. He funded it with a loan of 50 lakh in September 2008.
As his product gained acceptance in the market, Mr Agarwal moved into a 40-seat office in Andheri East in Suburban Mumbai, and focused on building a team to drive sales. But this was a challenge for a cash-strapped start-up. 

To counter it, he adopted a unique tactic. “We got a whole number of interns on board. This brought down our costs, as they remained interns for six months before joining us,” he says.
After six months, when most of them joined as full-time employees, the company had a fully-trained motivated staff to hit the ground running. Soon enough, the Mobicule team had their next mobile application ready. This one was titled MWarehouse, a device that helps large retail chains such as Shoppers Stop carry out inventory audits and checks.
Typically, the startup ties up with large retail chains and provides them with an application that is installed within the hand-held mobile scanners used to take inventory checks. The device then uses Wi-Fi or a LAN connection to update the inventory onto the enterprise resource planning system (ERP) in the back-end. Shoppers Stop picked up the application first.
“At that point, we were looking for a way to automate our distribution centre. We were looking for multiple options. What impressed me about the Mobicule team was that they were willing to develop the product at no cost, and provide it to us — essentially put their money where they mouth is,” says Rajit Satyanath, CIO of Shoppers Stop, who signed on as Mobicule’s first client for this product.
The key to Mobicule’s rapid growth has been its ability to pick up customers at regular intervals, including marquee ones such as Unitech Constructions, Baxter Pharmaceuticals and Usha Electricals.
Similar to their flagship product Msales, Mobicule has also recently launched a software tilted M-CRM, a mobile application that helps companies stay on top of their pre-sales process — managing and updating of leads before the sales is carried out.
Across the various enterprise applications, Mobicule uses a licensing business model: one where companies pay a licensing fee of approximately 7,000 per user per year. With most companies having large sales forces, the average collection for Mobicule is 5 lakh and above per client per year.
Apart from its enterprise applications, Mobicule also has a consumer application titled Fonebackup, which allows users to back up their handsets. Majority of their revenues come from enterprise applications. Revenues, which are today pegged at 2 crore per year, are projected to increase to 7 crore by the end of 2014.
Despite the growth, Mr Agarwal has struggled to raise funding for his project so far. “The mobile enterprise space is a unique one. As it is relatively new, investors have difficulty in understanding the potential of the space. If we had raised funding earlier, with increase in marketing and sales, we could have been much bigger than what we are today,” he says. 

For now, the company is looking to build applications on new platforms such as iPhone and Android and to start hawking their products across new geographies such as the Middle East and the UK.

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