Bootstrapping a $175 Million Business with Services: TEOCO CEO Atul Jain (Part 7)

Sramana Mitra: What percentage of the revenue would you say is BPO services?

Atul Jain: We are mostly a software company. When you say professional services, do you mean to say installation and implementation kind of stuff?

Sramana Mitra: No, anything that is custom where you’re not selling software.

Atul Jain: We don’t do any real contract-based software development. Sometimes, we do services that are not selling software. For example, we do have a portion of our business, which is not very large, where somebody will hire us to do optimization of their network. They’re not buying our optimization software. They want us to come in and optimize their network. Sometimes they will hire us to do managed services on an ongoing basis. There are services like that, but there are no services where we are building custom modules of our software. Our software is mostly product-oriented because there are components of the solution where we have to interface with your data and we have to make sure that we can import your data and solve your use cases.

Sramana Mitra: I think you’re underestimating your value. I think your business is closer to the $800 million valuation. What do you want to do with the business?

Atul Jain: When you take private equity, I have to create some liquidity. I have an obligation. Eventually, there has to be either a sale of the business or an IPO. I have a clear preference for an IPO simply because I didn’t do it to make money. I did it to create a culture. I’m assuming you’ve figured out that TEOCO stands for “The Employee Owned Company”.

Sramana Mitra: Oh, really! I had no idea.

Atul Jain: It was important for me to communicate how I think and feel about it. That it’s a model of shared success. I will make every effort to see if we can go down the path of liquidity. My preference is to create an IPO that will enable us to preserve the brand and culture to a great degree. It will change and evolve because a public traded company does have a slightly different nuance in terms of culture. More than that, I want people to have a great place to work in and to continue to feel that what they’ve dedicated their blood, sweat, and tears to isn’t going to be taken away by somebody else in a manner that they didn’t sign up for.

Sramana Mitra: Fantastic. Atul, I love your story.

Atul Jain: It’s kind of you to say that. Just so you know, it’s important for me to teach and coach so I’m writing a book. It’s called “At What Price?” It’s not published yet. Our India Country Manager is Srinivas Bhogle. He has co-authored the book with me. The words are his and the ideas are mine. We are hoping to publish it in the next 12 months. Does the name Bhogle ring a bell for you?

Sramana Mitra: It does, but I can’t place it.

Atul Jain: Harsha Bhogle, the cricket commentator.

Sramana Mitra: Right.

Atul Jain: So this is his elder brother. He’s three years senior to me. We know each other for 37 years. He’s like an elder brother to me. My goal in sharing that story is to promote the concept of principled entrepreneurship. To show people that you can have a set of values and principles and you can build a successful business on those sets of values and principles. Creating a successful business doesn’t have to be based on trampling people. You can create joy for people and still create a successful business.

Sramana Mitra: As you can tell, what we do is very much in line with that principled entrepreneurship. The emphasis of the principles perhaps is on different parameters.

Atul Jain: I have watched a couple of your videos. I’m a huge fan of entrepreneurs. I like the concept of lean startups that you articulate. A lot of people think entrepreneurship is about money. You don’t. I completely subscribe to that. It’s about customers and profits. It’s about understanding that it can be done with little or no capital.

Sramana Mitra: That was a great story. Thank you very much for your time.

This segment is part 7 in the series : Bootstrapping a $175 Million Business with Services: TEOCO CEO Atul Jain
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