Scaling a Cloud Telephony Company in India: Knowlarity CEO Ambarish Gupta (Part 3)

Sramana Mitra: Whom did you raise money from and what was the process of raising money?

Ambarish Gupta: Initially, I and my co-founder just put in 1-1.5 million rupees (~$20,000 -$30,000) to build the infrastructure. We had built up a small platform and were struggling to find some takers. We didn’t really want to raise money immediately. The Chief Minister of Orissa Naveen Patnaik was campaigning for elections. He wanted to be able to call 7 million people in 10 days. We were able to demonstrate our ability call 10,000 people in a day but the requirement was for 70,000 calls in a day. We were able to get the order from the political party but in the next 10 days we went from one server to ten servers. 

Sramana Mitra: How much did they pay you?

Ambarish Gupta: They paid us one rupee (~$0.02) for every call.

Sramana Mitra: There is your seed money!

Ambarish Gupta: Yes, that was our seed money! He had given us 7 million rupees (~$140,000) in cash. We were able to expand from one machine to 10 machines. By the end of the whole thing, we were able to make 7 million calls. He won the election and I remember asking him if we can make it a recurring deal as elections come every five years. After winning the election, we went to see him and said that he won because the Indian population felt he was a very progressive politician who is using new technology. So, he asked us to make thank you calls to everybody. We had to make another 7 million calls and he paid another 7 million rupees (~$140,000).

Sramana Mitra: That’s awesome. Fantastic. So you got another 7 million calls. You basically got 1.4 crores (~$280,000) out of this guy.

Ambarish Gupta: That’s right. It was close to 1.5 crore rupees. I was really excited, but I was looking for something repeatable. We used the money to start hiring the engineering team. Every time a client requirement comes, they’d just have to call. We hired a four-people team to build up a platform. Voice Over IP is not allowed, so we built the platform from scratch. Second, I went around and tried to convince this guy that he should send this kind of messages for every Holi and Diwali. He didn’t agree with me. That would have been seventy lakh rupees (~$140,000) every year!

We were pushed back and I said, “We need to build up enterprise telephony for private sector SMBs.” So, we went back and built up a platform. It’s a cloud telephony platform that works on copper wires. In Voice Over IP platform technologies, voice packets that come up on the Internet, and an AWS kind of system processes this. It is a simple system. However in India, it is not allowed. You cannot take the voice packets to Internet. You have to process it in India in the servers in Delhi. You hook up the copper wires, which is very old technology. You have to literally build a distributed system hooking up copper wires and data centers, putting up load balancers and worry about system going down, call routing, load balancing, and call distribution. It’s a scary, complicated job. That is what we ended spending a lot of time in the first one year.

This segment is part 3 in the series : Scaling a Cloud Telephony Company in India: Knowlarity CEO Ambarish Gupta
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