Do It For Me Analytics: Anil Kaul, CEO of Absolutdata (Part 2)

Sramana Mitra: What was the concept of Absolutdata?

Anil Kaul: While I was at Personify, I had realized that analytics is a very powerful concept. This is going to be an area which will have a big impact on how businesses are done. That’s the first part. I also realized that as analytics becomes a bigger part of businesses, there’s going to be an issue with skills. We decided to open up an office in India while focusing and targeting clients in the US.

Sramana Mitra: Did you have funding for that? What was the structure of Absolutdata at the beginning?

Anil Kaul: It was completely self-financed. We financed it ourselves and continued like that for a while actually.

Sramana Mitra: This India-US model that you were doing, was there an anchor customer that you were able to get at the very beginning with that concept?

Anil Kaul: Yes, we were able to.

Sramana Mitra: Who was that?

Anil Kaul: It’s a small company out of LA called Lieberman Research. They were our first customer. We were subcontracting their analytics work.

Sramana Mitra: How big was that from a revenue perspective?

Anil Kaul: I think that was about $500,000.

Sramana Mitra: Was it an on-going thing or was it a one-time half a million deal?

Anil Kaul: It was an on-going thing. They were a customer for us for about five to six years until we had a change in our business model.

Sramana Mitra: You had, essentially, your seed capital from this customer?

Anil Kaul: Yes, in a way. When we started our first project, they prepaid for the project.

Sramana Mitra: Where in India did you put your operations?

Anil Kaul: We set it up in Delhi.

Sramana Mitra: How many people were in the India operation?

Anil Kaul: In the first year, we had a small team of about ten people.

Sramana Mitra: Ten people that was financed by this one LA customer and you were out here?

Anil Kaul: Yes. In the first year, we actually had two customers. We had also started working with Staples in Boston. That was our second customer.

Sramana Mitra: How big was Staples?

Anil Kaul: The first year, they were around $100,000. Over time, we did grow them close to $700,000.

Sramana Mitra: Did you get Staples also through your McKinsey relationship?

Anil Kaul: Yes. These were all through a colleague of mine from McKinsey who had joined Staples.

Sramana Mitra: Terrific. So you had a nice couple of anchor customers with which to bootstrap your company using services essentially.

Anil Kaul: Yes.

Sramana Mitra: How long does this model go on?

Anil Kaul: Till about 2007. It was actually a mixture of two types of services. Even though analytics is the core business that we started off with, we realized that the demand for analytics wasn’t as great as we wanted or expected it to be.

We added another line of business, which was market research. The market research piece grew quite a bit. In 2007, most of our business was market research. We had about ten customers at that time. That year, we had an iconic meeting where three of us sat down and realized that if we wanted to grow the company further, we needed to change our business model and focus more on analytics rather than market research.

The second piece is we decided that we won’t be doing any subcontracting. We would just focus on working directly with end-clients. This meant that we would lose some clients. We informed them about the change in strategy so that they’re aware of what we’re doing. Over time, that business went away.

This segment is part 2 in the series : Do It For Me Analytics: Anil Kaul, CEO of Absolutdata
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