Building a Global Education SaaS Company From India: WizIQ CEO Harman Singh (Part 4)

Sramana Mitra: The angels invested on what thesis? Typically, investors look for investment thesis. What was the investment thesis?

Harman Singh: The thesis was that educators want to be connected to students over the Internet. That thesis never changed. The business model was unknown, but this thesis hasn’t changed. It wasn’t about B2B or B2C. This is all about whether educators can be connected to students online. We went on and the company Educomp invested some money into the business. The good thing was that we had users. Thousands of educators were using our product although for free. That was when we experimented by introducing a $50 a year membership. However, $50 per year is a very small amount.

Moving forwards, we sat together and figured out our business model. At the end of 2010 and early 2011, we realized that education service providers should pay. We figured that if we charge students for anything, most students do not learn a subject after six months. After those six months, who knows if they are going to come back and learn something. The cost of acquiring a student versus lifetime value would not match up. On the other side, if you look at education service providers, if for whatever reason they become a customer, they would tend to be your customers for much longer because they are in the business of teaching or training pretty much all throughout their careers. Whether it’s 5 to 10 years, they would stick around. We consider students as the customer of our customer. That guiding principle is still there in our organization. That has paid off well.

Sramana Mitra: Let me ask you a question just to clarify and underscore what really stuck. What timeframe was it? How long did you have to fuss around and experiment before you arrived at something?

Harman Singh: It shouldn’t have taken us that long. It wouldn’t if I were to start something now. It took us three years at that time.

Sramana Mitra: 2006 to 2009 was when you did that experiment?

Harman Singh: No, we launched WizIQ in 2007. In 2006, we only conceptualized it as an idea. April 2007 was when we released the first beta. Between 2007 and 2010, we were fluctuating in between.

Sramana Mitra: How did you sustain yourself from 2007 to 2010? How many people were there?

Harman Singh: There was some revenue coming in from previous projects. We hadraised angel investment by then and we also had taken investment from Educomp.

Sramana Mitra: What happened to the $2 million services business? How much of that was still around?

Harman Singh: Very little. Most of that had gone away. We couldn’t do a services and products businesses at the same time. We were doing about $300,000 to $400,000 billings a year in those days. It had earlier gone up to $2 million. We had already let go of half of our team. We were a very small nimble team at that time. Being in India, our costs were pretty low. All those things helped out. If we didn’t have such a low cost base, we could not ever have done this.

Sramana Mitra: Also, you were in Chandigarh. That, I’m sure, helped a tremendous amount because if this was going on in Bangalore or in one of the more active cities, costs would have been incredibly high.

Harman Singh: Exactly. It’s a double-edged sword being in a city like Chandigarh. On one side, there’s hardly any poaching because you can pretty much afford to pay. However, top talent is not accessible.

Sramana Mitra: There are lots of disadvantages. You cannot find top talent. You cannot find experienced management and investors who would want to invest in these second to third-tier cities often. There are pros and cons. The one thing that you said which I do not agree with is that you couldn’t have done the services and product businesses simultaneously. That would have been the right strategy for you.

Harman Singh: I somehow agree with you.

This segment is part 4 in the series : Building a Global Education SaaS Company From India: WizIQ CEO Harman Singh
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