Bootstrapping Using Services from London: Ajay Patel, CEO of HighQ (Part 2)

Ajay Patel: The vision was to build our own deal room or file sharing application and then license that to the legal industry. We put in our savings, which amounted to $30,000 and started HighQ. To this day, it is still a bootstrapped company. Having no money meant no salary, but it also meant that you had to spend money on what you actually needed. What we needed was a development team. We went to India.

Thirteen years on, I have to say that was the best decision we made. Today, that team is almost 100 people. I feel that if we had started off with financing or had a lot of money behind us, we may have gone for UK. We couldn’t have scaled that dev team like we have done today. We just started with product development really.

We did not make revenues in our core product because we found it very difficult back in the early 2000 to convince law firms to actually share their and their client’s data in the cloud. It was very much like, “We don’t want you to have this on-premise.” We were all about putting it on the cloud and we wanted to provide it as a license model. We spent five years developing the product. In the meantime, making meager consultancy revenues which kept the business afloat.

Sramana Mitra: Let me get a few details there. When you started HighQ, you did it completely bootstrapped and you were using consulting services to basically make ends meet. You were building this product on the site subsidized by those consulting revenues. Is that correct?

Ajay Patel: Correct. Those consulting revenues were part of HighQ. It wasn’t that we had a side job.

Sramana Mitra: Just to underscore what you’re talking about, this is a methodology that we have actually given a name. It’s called Bootstrapping Using Services. It’s a methodology that we use a lot in our program. We see lots of entrepreneurs and we have lots of case studies of people who have done this successfully. I have published a book in the Entrepreneur Journeys series that’s called Bootstrapping Using Services. You’re in very good company there.

Ajay Patel: I would have to buy that book. That sounds fascinating. I’m sure that’s the same journey many bootstrapped businesses follow. The problem was the market wasn’t really ready for what we were ready to supply as the cloud was very new in those days. Especially asking law firms who deal with probably the most sensitive information on behalf of their clients, we weren’t able to convince them that this was the way to go.

For the first five and a half years, myself and Veenay didn’t draw any salary. We believed in the company and everything that came in was plowed back to more development and more people for the business. In 2006, we managed to convince one law firm – Magic Circle Law Firm – to buy into us. Since then, things started taking off. For the first eight to nine years, one could profit in terms of revenues as a lifestyle business.

Sramana Mitra: There’s no problem with lifestyle businesses.

This segment is part 2 in the series : Bootstrapping Using Services from London: Ajay Patel, CEO of HighQ
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