Bootstrapping a Marketplace: Sardor Umrdinov, CEO of Home Alliance (Part 4)

Sramana Mitra: Between 2016 and 2019, what are other strategic points that we should discuss in this interview?

Sardor Umrdinov: From the beginning, I would probably start with more structure till you reach the first $5 million to $10 million. After $10 million, it’s harder to scale if you don’t have the structure in place. The same thing goes for leadership.

Sramana Mitra: That’s a very generic comment. Can you be more specific?

Sardor Umrdinov: One of the marketing channels that we used was Yelp. It was too dependent on that. You cannot depend more than 30% on one source.

Sramana Mitra: What happened specifically for this to be a problem for you?

Sardor Umrdinov: Google came up with the Google Guarantee platform. They made some changes in the algorithm where Yelp doesn’t get enough traffic. The traffic from Yelp started decreasing dramatically. Building on somebody else’s platform is not a long-term strategy.

Sramana Mitra: How did you address that issue?

Sardor Umrdinov: We have a membership platform now. We were asking customers to post a review on Yelp. Now instead of asking them to review on Yelp, we ask them to become a member and actually refer more of their friends to us. It’s like what Amazon did. Amazon never sends traffic back to Google.

Sramana Mitra: This is a good point. What else?

Sardor Umrdinov: Another point would be to not play the short-term game for marginal cash. Play the long-term game. You cannot think more of yourself or your technicians. You have to think about the customer experience.

Unless you fix the backend of repeat customers, it doesn’t make sense to push more lead generation. At the beginning, we were working on the lead generation. We didn’t care much about customer retention. We would put more money into lead generation instead of being more customer-centric. We are most customer-centric now.

Another thing you should be careful about is making too many changes in implementations. You need to be really careful implementing more ideas or changes. At the beginning, we were just bringing new ideas on operations. You cannot change the operations randomly. Operations should be stable.

Sramana Mitra: Thank you for your time.

This segment is part 4 in the series : Bootstrapping a Marketplace: Sardor Umrdinov, CEO of Home Alliance
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