Ashwin Ramesh, CEO Synup chats with Sanjay Swamy, Managing Partner Prime Venture Partners.
In this conversation, they discuss how Ashwin got started with business at the age of 14, journey of building Synup, some challenges SaaS entrepreneurs face and moving business to the US.
Ashwin Ramesh started off with his venture at the age of 14, and at 18 his company made a million dollars in revenue. He is the CEO at Synup, a company that's trying to make local marketing less complex.
Listen to the podcast to learn about
0:50 - How Synup was started
6:30 - ‘Selling to large businesses requires geographical proximity’
7:30 - Building a management team in US
12:10 - How moving to New York City & not Bay Area proved advantageous for Synup
15:30 - Future plans of Synup
Read full podcast transcript below
Sanjay Swamy 0:22
Hi, this is Sanjay Swamy, Managing Partner at Prime Venture Partners. Welcome to this podcast series. Prime is an early stage VC investing in technology and product focused businesses. Today, I have with me, Ashwin Ramesh, Founder and CEO of Synup. Ashwin, welcome to the show. We have worked very closely with Synup for the past 4 years. And it's been a fun journey and a fun ride to work alongside you. Welcome to the show. Tell us a little bit about your journey. And, specifically how did Synup get started?
Ashwin Ramesh 0:52
Absolutely. Sanjay, thanks for having me here and thanks for investing in Synup. I wasn't sure that you would do it but it was great that you took the leap of faith. So my journey actually starts many, many moons ago. So, I became an entrepreneur, accidentally. The year was 2004, I was still in high school, found this thing called online marketing, fell in love with it. And, while I was an online marketer, I found out a big challenge that I was facing personally, which kind of led to the genesis of Synup.
Sanjay Swamy 1:19
And how old were you in 2004?
Ashwin Ramesh 1:22
I was 14 years old, just a while ago. So, it feels like a very-very long time.
Sanjay Swamy 1:28
So, we've really young teenage entrepreneur here at the age of 14. And tell us about the journey from there to the start of Synup eight years later.
Ashwin Ramesh 1:36
Sure. So, when I initially started out, like I mentioned, it was completely accidental. I just realized that I could sit at home freelance and do this thing called online marketing. So, my life started with essentially doing glorified data entry. Online marketing back in the day was like data entry. All you had to do was go in and update meta tags, title tags, build backlinks and then like magic, your site would rank automatically. I had a lot of fun building that business. So, that eventually became a formalized business. And I ran that for about 9 years, and had a lot of fun doing it. The idea for Synup came from there where I realized that if I went through the journey from 2004 to 2013, in 2004, I mentioned that I started optimizing websites, building backlinks and changing meta tags, everything happened on a website. Fast forward to 2013, nothing was happening on a website. And what I realized was all of my employees were actually doing what I was doing in 2004, data entry. But, across different platforms where consumers were actually searching. And this was a humongous waste of time, major pain to do at scale. And, I couldn't really find anything that solved that problem. So, I realized, "hey! nobody's gonna fix it for you so fix it yourself." And that's how the Synup came to be.
Sanjay Swamy 2:48
Awesome! So, tell us you talk about, people are doing things across multiple platforms. So, tell us the core insight of Synup and with some examples, please.
Ashwin Ramesh 2:56
Sure. So, when you search for anything right now, a restaurant or your search for a hospital or when you search for a new home services provider near you. What you're likely to find is sites that carry reviews or you're likely to find a profile on Google or a profile on Foursquare or profile on Bing, or you're likely to find it on a place like Instagram. Nobody really goes to websites anymore. So, I don't remember the last time I went to a restaurant website, I don't know. Do you ever go to a restaurant website? You don't, right? So, you find this information on Zomato or Google or Bing or Instagram. Now the challenge to the business is that to manage their presence across these places is extremely tedious and time consuming. Because all these places are silos, they don't talk to each other. As a consumer you expect this information you find to be accurate. So, I expect the menu on Instagram, Zomato and Google to all be accurate. I trust it over the website the business has. And now the business is stuck trying to manage their presence across 10 or 12 different places, which becomes a challenge. With Synup we have a way in which they can do this seamlessly, automagically, without having to spend all this human effort. So that a hungry consumer, like you and me can actually trust the information you're finding online.
Sanjay Swamy 4:08
Terrific! So, you built Synup over the last 3 years or 4 years, and it has evolved quite significantly. So, on the one hand, I still remember from the early days, you've been an entrepreneur always focused on making sure that you have solid revenues in the company, growing at least 100% year over year, over the last several years. And, at the same time, the businesses looks very different today from what it looked like say, three years ago when you started. Two major transitions: 1) moving to the enterprise segment, as well as 2) building out a huge team in the US. So, tell us about this journey. And how does one do this while maintaining consistent growth? What were some of the challenges you faced and what advice do you have for entrepreneurs?
Ashwin Ramesh 4:49
Sure. So, first thing is again, it also comes down to the DNA. So, I've done a bootstrap business for a very long time. So, ran a bootstrap business for 9 years. So, the core DNA that I have, and I think a lot People at Synup have is, we always need to keep generating revenue, if you're not generating revenue, you shouldn't be in business. That's our core DNA. And for us, every path to our journey at Synup was accidental. So, initially, we had no idea what we were doing. Sanjay, sorry to break it to you we had no idea what we were doing. But, I was very convincing, you sat in the same room and pitched you. I don't know why you wrote that cheque. Initially, we had no idea, it took us some time to figure things out. But we were still making revenue during that path. We were not doing SaaS for a long time, took a year and a half to realize that we had to do SaaS. And once we started doing SaaS, we realized that, hey! We could start selling software to small businesses globally sitting in India, because there are a lot of people in India doing it. And we realized that we could very quickly scale revenues doing that. For us. I think every time we made a change, it was when there was a plateau that happened. So, we started initially, by selling to SMEs, we had a plateau for three months. And usually when a plateau like that happens, I really feel very bad about myself and we all feel very bad about ourselves. So, during this SME plateau, we first iterated and we figured out that, the product we were selling, we couldn't sell it at scale to small businesses, while still ensuring that we were profitable. We kept our margins. So, our first transition was really moving away from SME to more of a mid market enterprise customer, that was a first kind of transition. And, then once we moved to mid market enterprise, we figured out that we couldn't really do that completely out of India, which is when I had to personally move to the US set up a team there, because selling to large businesses requires geographical proximity. You know, they didn't want you to be 10,000 miles away when they are spending a million dollars a year with you. So, all of these stages were extremely accidental, like I would say iteration, but more accidental, because it was not planned initially, if you had asked me in 2014, are you going to do this I wouldn't know the answer. But, I think what really forced us is every time we made the change it was because we saw a plateau and like I told you our core DNA is when we see, business slowing down, revenue is not growing. We usually tend to take action, and each of these scenarios actually pushed us forward to the next stage in the growth journey. Is this the final end of it? I don't know. Maybe it is. Maybe it is not. I believe this is a very scalable model. But, the only constant is change when you're running a business.
Sanjay Swamy 7:15
Yeah. So having said that, however, I think obviously, now you're in a very large segment, and winning successfully, with large enterprises in the U.S. as well as in other parts of the world. One of the big things you've done over the last year, though build out a complete, senior management team, which, in the past, was primarily an India based company with maybe one person in the US and now 30 people in the US and so on. And most Indian companies struggle with both these transitions. One is transitioning from mid market to the enterprise, which you've done successfully, and the second is building out a large, strong team in the U.S. Can you share a little bit about how easy or difficult that was? What were some of the tricks you had? What advice do you have for other entrepreneurs?
Ashwin Ramesh 7:59
Let me start with the bad part of building a team in the US, “Burn”. So, be ready for that. If you are an entrepreneur moving from India to the U.S., be ready for your burn to go up catastrophically, when you start a team in the U.S. So, obviously that's the bad thing, but there are a lot of good things about it. So, I'll talk about why we did it, what are the reasons you should do it and how we went about doing it. I think the challenge for an Indian Software as a Service entrepreneur, trying to crack enterprise in Bangalore is there is not enough of a talent pool available here. That is one big challenge. We are still swimming in a very small pond that there do not exist as many enterprise software service companies in Bangalore or Chennai or anywhere in India, as they do in New York City or the Bay Area. Secondly, even if there are people, they're not proximate to customers. So, if you're trying to build a large business, you need to have your sales leadership, your marketing leadership, your CS leadership, very proximate to customers, they should be able to jump on a flight, go visit a customer because that is expected from you. Then the third thing is that people also have seen a lot more scale. So, there's obviously a talent pool and proximity and scale. SaaS is a science, it's not an art. So, once you hit a particular critical mass, it's just about following a playbook. And unfortunately, we don't have those playbooks here. But there are people out there who have playbooks or who've been part of playbooks who can immensely help you. So, that's kind of the reasons why we did that pivot or transition. One of the things that I did very early on is I realized that I couldn't hire these people myself by going on LinkedIn and contacting them. I tried that for a long time, I would go and I would be like, Hey, will you come talk to me, it was extremely time consuming. Then I tried to get my India recruitment team to start hiring people in the US, that did not work out the quality of people was not good. One of the major transitionary changes we made was I allied with the right recruiters. So, initially, when I went there, I saw U.S. recruiter charging, 20-25% per hire, you can do the math if you're paying someone $200,000 for instance, you're spending 50k on hiring that person, which for me was like 35 lakhs. Initially, I was like, not very excited about it. The reason why we succeeded was when we allied with the right recruiters who come in with the Rolodex and who know what they're doing. Because a lot of times when you're trying to hire people, you don't know how much you should be paying, you don't know how to compensate them, because it's not like in India, they won't give you a pay slip. You don't know what they're making. You don't know where to look for the right people, and you don't know how to go about sourcing them. So, our biggest success and how we went about doing it is we allied with three specific recruiters. Three of them who I personally vetted, I spoke with, very small firms where I was talking to the actual founder of the recruiting firm, and they were like our extended HR team. And the division of labor was they bring in the candidates, and I go about interviewing these people and go through a very extensive process. And with each candidate, I actually had my own workbook. So, for marketing, for instance, there were 10 different factors I was looking at, to hire a VP of Marketing. In fact, I interviewed about 30 people almost and each interview lasted about four to five hours cumulative. This is across three different people. So, it was not a very simple process. It was a very long process, it was a very thorough process. And the way I was able to pull it off because I was focusing more on, okay, is this the right person rather than focusing on how do I get this person to come in? So, how do I get this person to come in is a recruiter's job. Is this the right person is my job. Closing them is also the recruiter's job. So, this division of labor worked out really well. It took a lot of time. But we were able to be fairly successful doing this. But it is, again, is a numbers game. The more people you meet, the more people you interview, the better your chances are. The other part is also you have to be able to convince them that this is a big opportunity. Because, again, you have to remember like, so we are in New York City, New York City is a second largest SaaS employer market in the U.S. after the Bay Area. There's a lot of interesting companies around but you need to be able to convince them, why this business is better than anything else. And I think that is also another reason why people end up working for you because you're able to convince them that this is the future.
Sanjay Swamy 11:54
Those are, I think, really useful insights. Quick question What about, the choice between New York and The Bay Area. Traditionally, most Indian companies look at the Bay Area as the first option. And obviously, it's from a time zone perspective, probably the worst where you're running a team in India and New York. What were some of the reasons you chose New York? And how has that panned out?
Ashwin Ramesh 12:14
I think it's mostly serendipity. Because I obviously did not have a location in mind when I wanted to move. I went to NYC because our first few employees were there, we had four employees in New York City, and I ended up eventually going there. But, I think it has actually worked out really well for us. It has worked out really well for us because, New York City is an interesting place. So, it's an interesting place where you can get an SDR for $40,000 who will be living in Queens.
Sanjay Swamy 12:40
SDR means ?
Ashwin Ramesh 12:41
Sales Development Representative. Someone who's actually doing cold calling and setting up demos for you. So, you can get someone like that for $40,000 which is what you would be paying in Texas or Salt Lake City. And you can also get the best product guys, who are going to cost the same as the Bay Area. So, New York City has a nice microcosm, where it's got people who will travel from other states, it's a tri state area. So, you have great connectivity over rail. To go find a job, and it will be a starter job. And you have a very-very good talent out there. So, you can build a nice mix. The Bay Area is a bubble. It's I think, kind of inflated. So, the same, Sales Development Representative in the Bay Area will costs $80,000 for comparison. So, I think one good thing that has worked out for us is we've been able to attract the right kind of talent.
Sanjay Swamy 13:26
Quality of talent, as well as the mix between the price points.
Ashwin Ramesh 13:29
Exactly. So, that is one thing, I think has worked out really well for us. The second thing that worked out really well for us is also when I moved to New York City, there was this huge talent pool available because a lot of people from the AdTech industry were actually moving out because AdTech was hyper inflated a couple of years ago. Now it's going through a lull, this really good talent that was in ad tech was available. And they're all like looking for a job they were all interviewing. So, this was more serendipity, right timing, which was not planned, but that worked out really well. I think, third thing is proximity to investors. A lot of people don't believe it. But there are a lot of interesting investors in New York City. In fact, I think there are more investors in New York City than the Bay Area who can actually invest in growth capital, for instance, growth equity. I think there's a lot of proximity to that. And fourth is network. If you start networking into the whole tech circle in New York City, it's a very close circle, but people actually help each other to a large extent. There are obviously different distinct circles as Indian circle, Israeli circle, different circles. But, I think once you are networked, they help you out because New York City is not only a tech town, it's a finance town. It's a tech town, it's a music town, it's an entertainment town, it's a business town. San Francisco is only known for Tech. And, personally for me when I go to Starbucks, I don't find someone right next to me saying they're going to invent the next Box, going to be bigger than Aaron Levie, which is what happens in the Bay Area. So, that is something I personally like.
Sanjay Swamy 14:55
Interesting! And I guess New York also probably has a fair amount of your customer base as well.
Ashwin Ramesh 14:59
So, our customer base is distributed. We don't have any customers in the Bay Area. Maybe that's also a reason to stay in New York.
Sanjay Swamy 15:04
Great! So the company has been doing really well growing really nicely. And what does the next couple of years look like staying in the U.S. as a primary market will you be expanding internationally.
Ashwin Ramesh 15:15
So, unfortunately, in the software business, especially enterprise software business, a lot of your revenues will come from the U.S.
Sanjay Swamy 15:22
So nothing unfortunate about it. It is a statement of fact.
Ashwin Ramesh 15:25
It's unfortunate because we have such a large presence in India that we are not able to tap into. So, Asia could be a large software buying market. It is not. So, I do think U.S. will be our primary market. But, we do expect to expand considerably in India. So, if you look at Asia, for us, India and Southeast Asia and all these places put together there was zero percent of our revenues about 12 months ago. Now they are at 10% of our revenue. So, that's significantly expanding. I do think there's a huge opportunity here, but I don't think it will be as large as North America, at least for the next few years.
Sanjay Swamy 15:57
So the primary focus will be North America.
Ashwin Ramesh 16:00
But, this would be our upside market. So, India, Middle East, Africa, Australia will be our upside market.
Sanjay Swamy 16:06
Got it! And perhaps Europe as well.
Ashwin Ramesh 16:07
Europe as well. Yeah!
Sanjay Swamy 16:09
Great Ashwin. It's been an amazing journey so far, but I know the best is yet to come. Wish you and the team all the very best.
Ashwin Ramesh 16:15
Thanks a lot Sanjay for having me. And it was a pleasure doing this with you.
Sanjay Swamy 16:18
If you believe you are building the next big thing, let’s make it happen.