568th 1Mby1M Entrepreneurship Podcast with Abinash Saikia, EnCloudEn (Part 2)

Sramana Mitra: Total funding of under one million dollars and a little bit of government fund. Talk about the customer development process. Where did you get the customers from? What type of customers zeroed in on your value proposition?

Abinash Saikia: Before these guys put in money, we were able to acquire a reputable customer. You’ve probably heard of Biocon in India which is the largest biopharmaceutical company in India. I was working in strategy at Biocon. My manager connected me to the CIO at Biocon. I built a relationship with him over time. They became our first customers.

The CIO was a mentor in a way. He has helped us in figuring out the right features that we need to put in the solution. He was the first one who tested the solution. We learned a lot from him. They became our first customer. It was not just an idea on a paper. It’s a product that already exists. That is how we started.

Sramana Mitra: What was the size of the Biocon contract?

Abinash Saikia: It was a five-year contract. Our total revenue was $300,000. Biocon was a starting point. We continued selling to different companies. We focused on south India. Like most startups, initial sales are all hustle sales in a way. You go after contacts that you have. I was focusing on that. We had a bunch of reputable customers. We have IIT Madras and a few government agencies. We were able to create a good set of customer base. They were referenceable names.

Sramana Mitra: In working with you, my observation was that you were also able to finance your customer development process and the product development process. You were targeting Indian customers and were able to close Indian customers. In that process, the product was being built.

By the time COVID hit, you had customers in India and revenues. Your product was at a reasonably mature level. It was very helpful in even thinking about looking for an acquisition. One of the things you mentioned that I want to underscore is the difference between founder-led selling and actually building a channel to sell.

Building a channel to sell is a very expensive process. It’s very different from founder-led selling. There’s a lot of trust-building that happens between the founder and the customer. It’s usually a technical founder selling to a technical customer. That is the best way to do early selling.

One of the reasons why we are very bullish about Bootstrapping to Exit is that, with this process of founder-led selling aided by pure bootstrapping or with small amounts of capital, you can get solid customer references as well as product input to build something credible.

The sales engine is expensive. You have to raise more money to build a sales engine that will raise the bar on the exit valuation that you’re going to have to get to. This is a point at which you have the option of considering Bootstrapping to Exit. There are people who have synergistic channels who are looking for additional products to sell through the same channel.

The stars align in a Bootstrapping to Exit scenario when you can get to that point where you have an attractive technology that somebody who has the channel is interested in buying. That success of EnCloudEn from my vantage point is that all those stars lined up and you played your cards very well in making that happen.

This segment is part 2 in the series : 568th 1Mby1M Entrepreneurship Podcast with Abinash Saikia, EnCloudEn
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