Building a Global Education SaaS Company From India: WizIQ CEO Harman Singh (Part 6)

Sramana Mitra: How much were you charging?

Harman Singh: On an average, $250 per educator per year. In those days, it was about $150.

Sramana Mitra: It was a per educator pricing?

Harman Singh: Yes.

Sramana Mitra: When you worked the test prep academy, were they buying for multiple educators? What would a test prep academy deal look like?

Harman Singh: About three to five trainers.

Sramana Mitra: It was around $1,000 deals.

Harman Singh: Exactly.

Sramana Mitra: You were able to complete these through telesales and web, right?

Harman Singh: Yes. That was the whole idea that we didn’t have any field sales channel.

Sramana Mitra: You were doing telesales in India or did you have people in the US?

Harman Singh: No, this was all in India.

Sramana Mitra: You were selling around the world using telesales from India.

Harman Singh: Our India revenue is about 15% to 20% of the total revenue.

Sramana Mitra: But you were selling globally though using telesales out of the Indian operation?

Harman Singh: That is correct. That is how we started growing. This model was new to us. It’s very hard to find people who had done this kind of work. Most of the BPO were not selling software products. They were selling some kind of insurance products. Those were some challenges around selling software. Then we had a tragedy. My co-founder passed away in June of 2011.

Sramana Mitra: What happened?

Harman Singh: This was terrible both from a personal and business standpoint.

Sramana Mitra: This was your brother-in-law, right?

Harman Singh: Yes. We went through tough days. Cash flows were dwindling and we had to raise investment. We went through troubled times for 18 months.

Sramana Mitra: The investors were willing to give you more money at this point?

Harman Singh: Yes. We had a deal earlier. We were going through that although money coming in was tougher and tougher. It was in late 2011 and early 2012. That was when I went on the road to raise more investments from different investors.

Sramana Mitra: Were these existing investors who were putting in more money? This is not a situation where it’s easy to get money at all, right?

Harman Singh: I went on the road for nine months. On one side, I didn’t have that co-founder anymore. I was making pitches to keep the business going. There was really low confidence in the office. That was a nightmare. The only thing that was pushing me was that I cannot quit.

Sramana Mitra: What did you tell the investors why they should invest more in you? What did they come back to tell you?

Harman Singh: The good thing was our business was growing even with all these issues. The opportunity was there.

Sramana Mitra: Your existing investors who saw that there was finally a product and you had a product market fit and they decided that this is worth investing more on?

Harman Singh: The money I got was not from the existing investors.

Sramana Mitra: They’re new investors. Who were these new investors?

Harman Singh: One is Kaizen run by a Stanford graduate in India. It’s an education-focused private equity fund out of Mumbai. The other is Bertelsmann.

Sramana Mitra: Did you then take out your earlier investors in this new round of financing?

Harman Singh: No, they didn’t exit.

Sramana Mitra: They got diluted in the process.

Harman Singh: Not really diluted. They have significant stakes in the company. That’s one thing that’s important to me. Whoever has invested should get the right outcome on the voting.

Sramana Mitra: It’s very hard to do. When you try to raise money for a struggling business, new investors tend to squeeze out the older investors.

Harman Singh: I understand that. It’s not happening in my business. I actually take pride in that.

Sramana Mitra: That’s very good.

This segment is part 6 in the series : Building a Global Education SaaS Company From India: WizIQ CEO Harman Singh
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