Bootstrapping with Services in India: Srishtisoft CEO Ajay Sharma (Part 2)

Sramana: What were the primary sectors that you supported?

Ajay Sharma: We did a lot of application integration work for healthcare companies, media companies, and financial companies. Those were our three primary verticals. In 2004, we ran into some challenges. In fact, the period between 2004 and 2005 was challenging for most Indian services companies. At the beginning of 2004, the company had four partners. All of us got married during that period and two of the partners felt our market had too much risk to proceed with the company. They elected to leave and get a more secure job.

Sramana: How large was the company? Was it just the four of you?

Ajay Sharma: No, we had 200 employees at that point. We had differences among the partners, so we had to liquidate that company.

Sramana: What was so challenging about 2004?

Ajay Sharma: It was a difficult time for all software services companies. We specifically had a hard time continuing with our integration niche. The larger companies started offering integration services for free as a way to entice their customers to buy more software. The two of us that remained decided to liquidate the company so that we could share profits equally. We decided to take our proceeds and form a new company together. The goal of the new company was to focus entirely on products.

Sramana: When did the liquidation occur?

Ajay Sharma: In 2005.

Sramana: How much revenue were you making at that point?

Ajay Sharma: We had a revenue run rate of 10 to 12 crore rupees (~$1.5 million) with a profit of 2.5 to 3 crore rupees.

Sramana: Did you consider trying to sell the company as an entity?

Ajay Sharma: None of us had any experience selling a company. Not many people were very forthcoming about the process. By the time we decided to sell the company, there really was not a lot of value left in the company.

Sramana: So you decided to split the profit and form a new company. How easy was that?

Ajay Sharma: The company had been running for four years and we had accumulated profits in the bank. We liquidated the business and two of us continued on the entrepreneurship path. We decided to focus on a product business this time so that if there was another downturn we would have something to hold onto. Since we had done a lot of services work in the healthcare space, we started to look at our options in that space.

This segment is part 2 in the series : Bootstrapping with Services in India: Srishtisoft CEO Ajay Sharma
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