The 25-Year Grind Behind India’s Travel Revolution: The MakeMyTrip Story | S4E4 | Destiny Avenged | Weekend Ep.

[00:00:00] Karthik Reddy: What gave you the courage to start MakeMyTrip back in that timeframe in India where we used to always joke that broadband theek se nahi chalta hai and how did you think this will get off the ground? 

[00:00:08] Deep Kalra: My thesis are very simple. What’s being done on the phone will move to the internet fast.

[00:00:12] Karthik Reddy: I am aware of that story. It is always cited as a napkin story where… 

[00:00:15] Deep Kalra: It is a true story. We sat in Crossroad Mall in Tardeo, and we did not have a piece of paper. We had managed a pen and there was a paper napkin, and we agreed on terms. 

[00:00:23] Rajesh Magow: If the market is not ready, market is not ready, no matter what you do, so you will have to stop. If you just keep pushing the paddle there, you are not going to get the results because the level of digitization was zilch at that point in time. Internet did not really exist. We were early. 

[00:00:38] Deep Kalra: I actually think if I could wish something on an entrepreneur today… 2005 to 2010, we grew 25x. We raised four rounds. Second round split between Helion and Sierra because again, we are nice guys and could not say no to one and I am glad we got both. 

[00:00:52] Karthik Reddy: What are your best COVID stories? And we had many travel businesses which had revenue go to zero literally in that month.

[00:00:57] Deep Kalra: We reported a quarter, we were down 96%. 

[00:00:59] Karthik Reddy: Holy cow! 

[00:01:00] Deep Kalra: Sanjeev tells us in this board meeting in January, 2010, and in his typical style, saw the material, saw the slides, and he says, you guys are ready to IPO. Rajesh and I looked at each other and said, really? He said, yeah, this was our size. 

Two days before IPO, we are right in the end a company, which has got their, I think, just rewards today… Try to derail IPO. Flippant complaint, some nonsense, which went straight to SEC. 

[00:01:23] Karthik Reddy: Today, if you look at a founder in your shoes, and let’s take the business predictability as a given, what would your advice be? I know the best of public company CEOs and founders, will say, we do not look at the price, but how tenuous was that journey? What does the future look like for MakeMyTrip? And last question, most underrated, destination in India for travel? 

[00:01:44] Deep Kalra: I think in hindsight it worked out well only because of one reason…

[00:01:56] Karthik Reddy: Welcome to another episode of The Blume Podcast, Season 4. The theme for the season is Destiny Avenged. Each conversation spotlights people who fought past rejections and near misses to earn a chapter in the book on India startup history. This season has brought to you in partnership with IDFC FIRST Bank and Ultrahuman, a Blume portfolio company.

Today, we are joined by two gentlemen who are part of the OG Gang of the India Internet story. Deep Kalra and Rajesh Magow, Co-founders of MakeMyTrip. At the time when India was still dialing up to discover the internet, they dare to build an online travel company. launched in 2000, they complete 25 years today. 

They braved dotcom crash, 9/11, a global scale financial meltdown in 2008, COVID, much more. They were a Nasdaq IPO, believe it or not, in 2010. Against all odds, they have survived near-bankruptcy and thrived, bringing online flight bookings, hotels and holidays into the mainstream for India. From scraping through cash crunches and salary cuts to ringing the bell on Nasdaq, the journey became one of the most persistent and constant reinvention in that journey in India. 

Today, we will dive into the toughest calls, their scars, and how they turn near failure into Destiny Avenged. Welcome to the podcast Deep and Rajesh.

[00:03:10] Rajesh Magow: Thank you so much. 

[00:03:11] Karthik Reddy: Thanks for joining us today. It has been a remarkable 25 years. So, first congratulations.

[00:03:17] Deep Kalra: Thank you. 

[00:03:17] Karthik Reddy: That is the first thing I noticed as the cab drove into your office, 25 years, MakeMyTrip. It is lost on a lot of people that, that is how old the internet story is in India. Of course, they are the OGs of the internet story, which is you, Sanjeev, a bunch of these folks. 

But back then in 2000, I happened to be in the US, first ever trip to the US, totally enamored. I think I would attribute some of what I do today for a living of landing up there at the very precise dotcom boom of 1999 – 2000. So, I go to college and about 10% of the prior class does not come back after the summer break. 

So, that many skipped out of Wharton. And so you say what is going on? And this is what you land into first week and first week in the US.

And so you went to the Bay area, you looked at what is getting built pets​.com, which is always used as a… What gave you the courage to start, MakeMyTrip back in that timeframe in India where we used to always joke that dial up broadband theek se nahi chalta hai. And how did you think this will get off the ground?

And maybe before that story, I always like the guests to say, who are you before that? Were you from an entrepreneurial background? What inspired to even think of starting as an entrepreneur? 

[00:04:38] Deep Kalra: Okay, so I guess you are really taking back to the beginning, which is nice. And I like the way you did the subtle drop of Wharton. Guys, everyone Karthik is from Wharton, right?

But it is interesting that you were there at really boom, almost to bust. 

[00:04:54] Karthik Reddy: Yeah, in college. 

[00:04:55] Deep Kalra: Because we felt that in 2001. So, prior to starting MakeMyTrip or thinking of MakeMyTrip, I had done my MBA in 92. Not from Wharton, but from IIM, Ahmedabad, very proudly. So, I am PGP 92. I started working with ABN AMRO Bank, Dutch Bank in India.

I love the bank. It took me a couple of years to realize I do not like banking. So, I quit in three years. I could not see myself being a banker all my life. And I am so glad I quit. 

[00:05:19] Karthik Reddy: My first job out of Wharton, by the way. 

[00:05:21] Deep Kalra: Oh wow, really? Oh my God. 

[00:05:22] Karthik Reddy: San Francisco. 

[00:05:24] Deep Kalra: That is amazing. So, I was getting the itch, Karthik, to do something more tangible and I looked at various marketing jobs, almost joined, PepsiCo Foods, Ajay Banga, who is super senior from IIM‑A offered me a job to be marketing manager for Pizza Hut, which had not started in India and KFC and I almost took that up, including almost taking up a job with Arvind Mills for Arrow and all. That kind of stuff because I guess we are of similar vintage, slightly older. 

But then this friend told me that, this friend was at KPMG, dear friend of mine, and he said, we have a client, we do not do headhunting, but this guy is looking for someone in India. And this client is very interesting and it is something you might like. There was a company called AMF Bowling. Headquartered in Richmond, Virginia. 

[00:06:12] Karthik Reddy: I have heard of this story, but yeah. 

[00:06:13] Deep Kalra: The world leader in making bowling equipment and running bowling centers, them and Brunswick, it was like a dual play market. And I think Goldman Sachs had just taken them as a PIA investment or something. 

So they were really expanding. That was 1995. There were 10,000 lanes in China already, they had put in, total market, looking at 20,000. India had zero. Actually, we had four manual lanes in Qutab Hotel Delhi. And I had bowled as a kid and I said, yeah, this should do well.

And I got so fascinated in this one-hour meeting with this gentleman who was heading their business development, ended up being a three, four hour marathon meeting. And I said, I am on. And it was entrepreneurial. I worked for them, but whatever happened in India was my doing. I set up a small team. I got all of Southeast Asia to run, including Pakistan, so much for the Americans. 

But managed to put in all of 200 lanes in four years. So operationally, financially, it was obviously not a success, but I learned a lot. I learned all my street smarts. Then, I met everyone in India who either owned real estate which is long enough to take bowling sectors, which is 100 feet and 11 feet to get a pair of lanes in. 

[00:07:23] Karthik Reddy: Was Phoenix mills in Bombay one of them? 

[00:07:25] Deep Kalra: That is my proudest project. I will come to that. So, no one could think big. It was always four lane, six lane till finally Atul Ruia with Phoenix Mills had the vision. He had seen some of this overseas and he and I got along really well along with Ad Singh who was CEO for the bowling company. And we set up this 20-lane bowling center where AMF gave a sweet deal. And he gave the space and it was a model center, 20 lanes, also 8 plus 12.

But it connoted what we wanted, but it took me three years, four years to sell that. And the next one was gonna be something with DLF and PVR with with Ajay Bijli and DLF and we were going to convert Savitri Cinema in Delhi into a world class thing. But that just took forever. 

Uphaar tragedy happened at that time, and I knew this is going to take too long. Big lesson learned, which I think is, I still stay away from it. And Rajesh and I were talking about this in with some other context. 

Making money on real estate in India is really hard. Unless you are a McDonald’s or a Haldiram or at that time used to be ShopperStop or whatever. It is really hard because

[00:08:30] Karthik Reddy: Always out price the actual asset. 

[00:08:33] Deep Kalra: Yeah. The cost of real estate in India is just too high from the commensurate, what you can earn. 

[00:08:38] Karthik Reddy: Value you can earn from.

[00:08:39] Deep Kalra: Yeah. Also, because we have no zoning. And that is a problem today our hotel industry is facing where hotel partners tell us the other day, Neel Raheja and I were on a common Zoom. And he was saying, listen, it makes no sense for me to now set up hotels because there is no zoning unless an Aerocity comes along or something near the airport in Bombay comes along, I will never make money where I can make money doing, residential office, blah, blah, blah.

So, anyway, tried that four years, learned a lot of lessons, did not still realize that I liked being an entrepreneur and the panic set in that my learning has stopped. I would look at my batch mates from IIM‑A and various places and say, I need to go to an organization I can learn. And I joined G Capital and kudos to them for giving me a very exciting job. I was VP for business development, looking at new areas for distribution, which in 99 was the internet pretty much. 

So, I only spent about 16 months there, but I got formally interested in the internet and in my personal capacity. For me, it was changing everything. And I tried to make some of that happen in G Capital India. And to their credit, Pramod gave us a million dollars, set up a team to do gin​dia​.com, but it was clear that was gong to be a Saturday project. 

Obviously, because the bread was buttered from finance. The term startup did not exist then, but now you realize why you need a startup to do different things​.So, I think I was just so taken in. I was, all of 30 and I think ready to take risks and in 2000, I just took the plunge. So, first April, I had written my plan. I had two plans, one for online travel in great detail and the other plan for online stockbroking in great detail. 

My thesis are very simple. What is being done on the phone will move to the internet fast. All of our young entrepreneurs who are listening may not even be able to think of year 2000. But you know and Rajesh knows what we are talking about and any of the other older folks, but that was the reality. 

So, you never met your travel agent? You spoke to him on the phone? 

[00:10:36] Karthik Reddy: That is correct. 

[00:10:37] Deep Kalra: You spoke to her and then they would give you option. They run faxes. They do all that kind of stuff. And then you gave a check. And similarly, you spoke to your stockbroker, maybe every day or every, whenever you wanted to trade. But you saw him only at Diwali when he came and gave you a box of sweets and all. So that was the reality. 

[00:10:54] Karthik Reddy: These are business models that perfectly fit with massive disruptions of digitization. Whether it was internet first, then it was mobile, now it is AI. 

[00:11:03] Rajesh Magow: Totally. 

[00:11:04] Karthik Reddy: And we will come to the AI part, of course, towards the end of the show.

[00:11:06] Deep Kalra: I will quickly wrap this and Neeraj Bhargava reminded me that day, he was here for our 25^th year anniversary. He cut our first check. 

[00:11:14] Karthik Reddy: I am of that story and it is always cited as a napkin story.

[00:11:19] Deep Kalra: It is a true story. We sat in Crossroad Mall in Tardeo. And we did not have a piece of paper. We had managed a pen and there was a paper napkin and we agreed on terms. 

[00:11:30] Karthik Reddy: Oh, fantastic. 

[00:11:30] Deep Kalra: So, the business plan was on the laptop, but so the agreed on terms. And he seemed like an honorable guy. And of course when the money did not come for a while, I had palpitations, but it all came. So, he reminded me that I also came to him with a kid’s plan. And this is how taken in I was. 

Our first born was 99. So not dia​pers​.com, but similar. And I said, no worries. And I had three plans. So, he said, no, you had that. But we said, we like travel and I love travel. So, I have always been a very passionate traveler, as has been my wife, probably even more. And so I said this.

[00:12:03] Karthik Reddy: So, you knew you will relate to that problem for a long time. 

[00:12:05] Deep Kalra: Yeah. And I am one of those who finally goes with the gut and with the heart. Am I glad I did that? Not that online stockbroking should not have, would not have done well. But this is just so much more interesting. Family, I guess the last entrepreneur was probably, both my granddads because at that time you were entrepreneurs, you did nothing else. 

But not at any big scale. My dad was in private sector service all his life, with the Shriram Group and then with Chambers of Commerce, etc., and his post-retirement. My mom was a teacher all her life. So she taught, yeah.

[00:12:39] Karthik Reddy: You taught it yourself. You took adventurous breaks as they came, bowling into 96. 

[00:12:44] Deep Kalra: I have to be honest. I do not think one thinks of it that hard at that time when you are young, and I think if you have a nice degree in your back pocket in India, even today, and you are under 40, you will still get a job.

[00:12:58] Karthik Reddy: Yeah. 

[00:12:58] Deep Kalra: So, that time liberalization has happened. You have got a degree from the best business school. You are saying what is the worst that can happen? You will fall back to a job. The trick is, I think, not when things are not going right to hang in there and not go back to a job quickly, and we can talk a lot about that, but I will stop here. 

[00:13:16] Karthik Reddy: Rajesh, it is 20 years almost for you. And at least our research says that you met Deep right at the beginning. 

[00:13:25] Deep Kalra: Almost at the beginning. 

[00:13:26] Rajesh Magow: Absolutely. 

[00:13:27] Karthik Reddy: But you were working elsewhere for four years. Obviously, had a finance bent of mine, a chartered accountant. What sucked you in and what is that original inspiration and what is your story? Are you from a business background or your family, parentage, etc. 

[00:13:44] Rajesh Magow: Let me tell you my story. It has been fascinating story, hearing Deep. Actually. Every time you hear you, you realize 

[00:13:51] Karthik Reddy: there is always new nuance. 

[00:13:52] Rajesh Magow: New nuance. 

[00:13:52] Deep Kalra: I am trying to make it interesting for him. He knows almost everything. 

[00:13:57] Karthik Reddy: That is correct. After 25 years. 

[00:13:58] Rajesh Magow: Yeah. Like the 20 lane thing was interesting because I did not know about that. I knew many other projects that he had done. But it is always fascinating to hear that. My story, Karthik to be honest, started like a very, normal middle class, thinking background, if you will. And that is the background that we came from. 

Actually, I did my CA. I did not do my MBA in the same year, as Deep did his MBA 92 again.

[00:14:29] Karthik Reddy: Okay. 

[00:14:30] Rajesh Magow: And that is how it started. And what do you do typically after either you do your MBA, you do CA, you would look for a job, which is one of the blue chip companies. The FMCG blue chip companies or some of the multinationals or let’s say Indian great corporate houses and all. And that is exactly what I did. 

So, I joined Voltas for a couple of years, one year in Bombay, one year in Delhi. Large corporate, learned a lot, early days. And then, I got a very interesting opportunity to actually make a switch. It was a large organization and I could not survive beyond two years there because it was less action, slow organization, large organization.

And I was maybe a little more restless and ambitious. I got an opportunity, a very interesting, tech education company back then, and I am sure you would probably remember that was called Aptech, is still around. 

[00:15:26] Karthik Reddy: Yeah. 

[00:15:27] Rajesh Magow: And Aptech and NIIT back in the days, and there was a computer education.

[00:15:31] Karthik Reddy: That is correct. 

[00:15:32] Rajesh Magow: And basic level computer education too, taking into very many diplomas and nowhere close to any of the computer engineering colleges and stuff. 

[00:15:41] Karthik Reddy: Yeah. 

[00:15:41] Rajesh Magow: But lot of the other sort of population which was wanting to learn computers, we were teaching them.

[00:15:47] Karthik Reddy: Yeah. 

[00:15:48] Rajesh Magow: It was a great stint, five years, under, very dynamic leader called Ganesh Natarajan. It was fantastic to work, under his vision. And I was doing finance role in Voltas. I was also doing finance role to start with an Aptech. But I got an opportunity, made a switch to business role then, there itself. 

That part I think was clear. Finance was more, let’s say, the academic background. Maybe functional expertise, but desire was always to be very close to the business. 

[00:16:25] Karthik Reddy: Lovely. 

[00:16:26] Rajesh Magow: So, that part was pretty clear. So, first opportunity, I got, I grabbed it. So, I was leading a division of Aptech called Aptech Computer Education, their flagship division. I was a franchise model and we had some 300 centers. I was leading North Zone for them when I left. And that was five years, beautiful, just a golden period for me. A lot of learning and very progressive, company early days. So I was, quite lucky, from that perspective. 

I think then after that was a very interesting move that happened. I call it more as a dry run before MakeMyTrip. And that was a startup, back then, called Quantum Education. It was a ed tech startup. We were trying to, back in the days, hybrid model of classroom and video lectures, trying to get master of computer science from University of Illinois, back. 

[00:17:31] Karthik Reddy: Sitting here. 

[00:17:32] Rajesh Magow: Sitting here. And a combination of classroom as well as.

[00:17:35] Karthik Reddy: You still have not achieved this milestone, 25 years.

[00:17:37] Rajesh Magow: Exactly. Back then, that was the attempt that made. HCL stalwart, gentleman called Mr. Anil Dang. He was the one who had set it up. 

[00:17:47] Karthik Reddy: Heard the name. 

[00:17:49] Rajesh Magow: Yeah, no, he used to run network before he set it up. But very soon we realized about 18 months at least, I was there. It was not a scalable model. One, it was very expensive, and it was not necessarily scalable because it was not necessarily live, although the degree was the same. It was not a correspondence degree if you know what I mean. It was not distance learning and always exactly the same degree.

But it was unscalable. It was very expensive. Maybe pre-sunrise. But it gave me enough, hunger and appetite and perspective change, if you will. It was good to work with some organization where you are building from scratch, if you will. And that is when I met Deep. And, again, it is a known thing. 

[00:18:41] Karthik Reddy: How did that happen, by the way, matchmaking? 

[00:18:45] Rajesh Magow: Actually regular routine channels. I went to meet him through a consultant. He was looking for a CFO. 

[00:18:50] Karthik Reddy: Okay. 

[00:18:50] Deep Kalra: OMAM consultant. 

[00:18:52] Rajesh Magow: OMAM consultants. Back in the days used to be big. Like an ABC Consultant, there was an OMAM consultants as well. And that is why when I met him, and I have said that, and it is in public pretty much in every sort of either podcast or forum, that the game changed when I met him. 

And it was not at that point in time on my mind, to be honest, that MakeMyTrip as a business model. What is that in dotcom or was I thinking dotcom or internet at that point in time? And Deep had built that model. I was not thinking at that point in time that. In my mind, it was only, I want to work in a young company.

I want to work in a startup. I want to be part of the journey from literally scratch, etc. And that was one part of it that was exciting and then after meeting Deep, everything changed. Because at that point in time, and it is true, and a lot of the time that people say at this point in time, from an investor perspective and you have been investor, all your life or most of your life so far, that you actually back the team, right?

You look for a founder, you back the team, which was exactly what the thought process at that point in time in my mind was because MakeMyTrip did not really exist at that point in time. It was just.

[00:20:16] Karthik Reddy: Too young to judge. 

[00:20:17] Rajesh Magow: It was just too young to judge an organization in that sense. So, you were basically meeting a person, getting comfortable with that meeting and making a judgment call. And he was making a judgment call on me and I was making perhaps a judgment call on him. That is how it started. 

[00:20:33] Karthik Reddy: For the current age entrepreneurs, there are 2, 3 different parts that you set 25 years ago, which are viewed very differently today, which I will touch upon. One is, by the way, the point you made when founders call me into interview CXOs, for their firm. 

I fundamentally tell your size of bet on the founder who introduced us is probably 4 – 5X the one I am making because I am diversified. You have nowhere to go. The next 4, 5 years are with this company. 

[00:21:09] Rajesh Magow: Absolutely. 

[00:21:09] Karthik Reddy: So, if you are unable to judge the founder and the mission and you do not love it. 

[00:21:14] Rajesh Magow: Absolutely. 

[00:21:16] Karthik Reddy: Because you are. 

[00:21:17] Rajesh Magow: It ​‘s amazing 

[00:21:18] Karthik Reddy: Your family is going to hate you for it, if you do not like it and you bring that back home. So, you are making the judgment on the team. It is an amazing thought that you had 25 years ago. It requires a certain maturity. So, that is how we push most people, especially if they are coming from different industries. 

[00:21:31] Rajesh Magow: Yeah, absolutely. 

[00:21:31] Karthik Reddy: So, recently there was a gentleman who came from McKensey as the CEO of one of our companies. He has never done any of the job other than McKinsey . It took 18 months today to convert him into a thing. And I said, 

[00:21:42] Rajesh Magow: It is very hard. 

[00:21:43] Karthik Reddy: It is worth, it is okay. But make the right decision. 

[00:21:45] Rajesh Magow: Yeah, exactly. 

[00:21:46] Deep Kalra: I take it one step further. You are absolutely right about this, which is when we are interviewing, I almost de-sell the company because the downside of getting a senior hire wrong is bad for the company too. Of course, it is much worse for the candidate, right? It could end up being one year of your 25-year career or whatever, two years. But even for us, because you lose not only time, you actually, I think, people normally. 

[00:22:10] Karthik Reddy: There is a lot of adjustment. 

[00:22:11] Deep Kalra: People then say, let’s face it when senior lateral people come in. Most people around are waiting for them to fail, except the guys who hired them, the human nature. It is only us rooting for the person to succeeds. So, it is really important. But to Rajesh’s earlier point, I am just so glad that I had a good day that day and I was able to attract him with this. 

[00:22:32] Karthik Reddy: This is a sell job, right? You have to sell to the talent even more than you sell to the investors. 

[00:22:37] Deep Kalra: If you are not selling to the talent, there is something 

[00:22:39] Karthik Reddy: wrong. 

there is something wrong. No, the other point which I thought was remarkable is that you did not have startups to gain the experience, and ironically, if you would actually gone to a corporate… We found a lot of founders in a Fund 1 one who were corporate trained.

And it is very difficult to extract them from that DNA.

[00:22:56] Deep Kalra: Very hard. 

[00:22:56] Karthik Reddy: And so today, when you take a second time founder, it is remarkable how much they have learned and grasped in a 3, 4 year run at a MakeMyTrip or at a Flipkart or whatever. 

[00:23:09] Deep Kalra: It is on steroids, right? You are learning so much more. But we found a few entrepreneurial companies. Very interestingly. We have been very lucky with Pepsi as a company. And it Is not like we went after Pepsi, but when one guy comes, the other guy tells about it. 

And we realized somehow they had, and maybe before Pepsi, they were somewhere else but the Pepsi or early days in India, I think they cut their teeth late nineties, early 2000 with great leaders and they were very entrepreneurial 

[00:23:35] Karthik Reddy: And they got the talent which matched that same deal. 

[00:23:37] Deep Kalra: So, they got marketing, they got sales. 

[00:23:40] Karthik Reddy: We hear you hear a little bit about this in Bain, for example. 

[00:23:42] Deep Kalra: Has to be.

[00:23:42] Karthik Reddy: Deepinder, Saahil.

[00:23:44] Deep Kalra: Yeah, of course. 

[00:23:45] Rajesh Magow: Exactly. That is true.

[00:23:46] Karthik Reddy: So, there are, you are right. I think it it is a cultural thing which nobody planned for, but gets set in some places and does not… 

[00:23:52] Deep Kalra: I think it is the CEO who ran a company in a certain way when that company was a startup here. 

[00:23:56] Karthik Reddy: That is right. 

[00:23:57] Deep Kalra: Bain came to India… 

[00:23:58] Karthik Reddy: But both of you curiously were a part of that entrepreneurial journey, which I think sparked. You almost sound like second time founders back then and you were not. 

[00:24:07] Deep Kalra: I think we cut our teeth with… I learned our entrepreneurial chops somewhere else and did not realize that we are actually getting ready for the brave new world. So, yeah. 

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Now, given how long the journey has been, I wanted to structure it using what I heard in last year’s podcast from Anand Deshpande of Persistent. He has been building for 35. 

[00:25:22] Deep Kalra: Yeah. I know Anad. Phenomenal guy. 

[00:25:24] Karthik Reddy: So, he told us something interesting, which is what I think entrepreneurs should understand when they are trying to emulate you, which is what I want people to do after listening today is, you get orbit ships. And so he has a idea of, next orbit or second orbit.

[00:25:41] Deep Kalra: Absolutely. 

[00:25:41] Karthik Reddy: So, he is always talking about how the company has to keep reinventing itself. And for you, you do not even have to ask. The crisis kept coming in cycles. And so I am very curious, let us take it orbit by orbit. Yeah. 

[00:25:54] Deep Kalra: That is a great frame of reference. 

[00:25:54] Karthik Reddy: And so you look at here, you launch, very bold, online travel portal in 2000, and then you have the dotcom crisis. So, cash melts away. I do not know how much you had and how you protected it. 

And then you had 9/11 and then basically in India, whatever little venture started vanished in five years. By the time, the Sequoia, Matrix, and Accel came back, it was 2005 – 2006. How do you survive the first five years?

[00:26:20] Deep Kalra: So, you are spot on. And that frame of reference, Karthik could not be better. So, actually, dream run, dream start, one year, where only lasted a year. So EVentures wonderful. Gave 2 million bucks. Site built in rapid time. 

[00:26:32] Karthik Reddy: 2 million back then was a big number. 

[00:26:33] Deep Kalra: A lot of money. Site built in rapid time, site doing well, focus on NRI market, which by the way, in hindsight. 

[00:26:39] Karthik Reddy: That was good innovation, I thought. No? 

[00:26:41] Deep Kalra: Yeah. And again, it was not by design. So, my original plan was also inbound, outbound, and domestic. Inbound was converting, firing well. And domestic and outbound, non-existent. People were looking but not booking. They were using us as a frame of reference, compare, go to the travel agent. 

[00:27:00] Karthik Reddy: Go to the agent.

[00:27:00] Deep Kalra: Yeah, exactly. So we said, okay, let us, I think a very smart decision was to stop burning money here and focus only on NRI market smaller but better $1000 ticket like you. 

[00:27:10] Karthik Reddy: And I used it, sitting there. 

[00:27:12] Deep Kalra: And our model was hybrid. So, it was internet, but 1800-India-10. 

[00:27:16] Rajesh Magow: Call center.

[00:27:17] Deep Kalra: And why? Because on the phone, we could offer you cheaper prices than we could give on the web because the airline was not bouncing on us. So, people loved it. And a $1000 ticket on the average $1000 – 1200, and you could make a clean $100 bucks. 

[00:27:30] Karthik Reddy: Interesting. 25 years ago, you had PMF overseas and not yet in India.

[00:27:35] Deep Kalra: Can you imagine? 

[00:27:36] Karthik Reddy: And you had to use a hybrid model to make the Indian value economics work. 

[00:27:40] Deep Kalra: You are so right. I am glad you are helping connect the dots for the entrepreneurs out there. But you have to listen to the market. You have to see your numbers. The critical metrics. A, you have to decide which metrics you want to look at.

[00:27:52] Karthik Reddy: Yeah. 

[00:27:53] Deep Kalra: And if you are not looking at conversion, then you are missing the beat at every step of the funnel. If you are not looking at repeat, and we are a long repeat on the NRI, but now in whatever business you are in, repeat is such a good, but I wouldd like to qualify it like unaided repeat. Look at five metrics, but look so hard on them. 

And if they are moving in the right direction, you are onto something. But if week on week, they are not moving in the right direction. Like in our business, we would measure, and we still would measure an hour today versus the same hour last week on the same day because the time of day when people make bookings was very different.

[00:28:27] Karthik Reddy: Yeah. 

[00:28:28] Deep Kalra: In the desktop era, there was a big flood, 9:30, 10:30 in the morning. People have thought about it at night they have come and use the office ​’cause your internet was very poor at home. Then there was a big flood late evening, then there was a lunchtime spike. 

Now with mobile everything changed and with cheap mobile, everything changed. Then, suddenly you found late evening big spikes in booking, etc. So, you have gotta understand in your business, I am sure Zomato is different. 

[00:28:52] Karthik Reddy: So to complete that journey, you managed to sustain this with Inbound and NRI till 2000…

[00:28:59] Deep Kalra: 5. But 2001 our world imploded and you mentioned two of the things dotcom bust, 9/11, and for us, even SARS, which is the grandfather of COVID, great grandfather, all happened at the same time. So, for travel, we were ravaged. It was the triple whammy. 

And we were totally ravaged. At that time, I think was the real test of what do we believe in on do we believe enough? Because one, eVentures wanted to wrap up, bought back the company, whatever money we could. 

[00:29:29] Karthik Reddy: Oh, that early. 

[00:29:30] Deep Kalra: In 2001. So that was our toughest moment of existentialism, do we believe or not? And at that point of time, I think that is when Rajesh from the outside was helping us. 

By the way, that thing on the outside, he was doing a build, operate, transfer to fund MakeMyTrip. So, that was Ebookers in UK. They wanted something done. They wanted both of us to run it. I obviously wanted to straddle this. So, we had a nice understanding. He was running that. 

[00:29:56] Karthik Reddy: That is the connection to Ebookers. 

[00:29:58] Deep Kalra: Yeah. Delivered a beautiful center to them with 250 seats, 230 seats and state-of-the-art center. And then when we got it back and two other, gentlemen, Keyur and Sachin, and you know I always say it, just recently I was saying their contributions to MMT, all three of them have in no measure been… 

[00:30:18] Karthik Reddy: So, I got the number wrong. it is not 20, it is 25. Sitting with Ebookers as well. So you have been there almost pretty much.

[00:30:24] Deep Kalra: Yeah. 25. Pretty much. And so I think for us, that was our real moment of reckoning. Do we believe enough to go without salaries, to make sacrifices, to convert salaries into whatever, this would be worth this paper. And so many people left. And I think we are glad they left because we could not afford everyone.

So, yeah, that is the reality but they left on their own because it was clear. Senior people take a cut, junior people, no raises. Overnight, we shrank from 42 people to 24, so we lost 40%. We moved from a nice office in the cheap area Okhala phase I, but at a ₹30 of square foot to a mezzanine in the same building at ₹12 rupees of square foot and a long thing. It was like a railway bogey where we sat and we worked together. 

And three of us, when we swiveled around, we had a little round table, smaller than this. Our knees hit each other, but we still are at TV up there to watch cricket. So, I think it was a crazy, the next four years were crazy. But it really made us believe. So, I think we begged, we borrowed, we did not steal, thankfully. And you value every rupee. So, I actually think if I could wish something on an entrepreneur today, I would wish a tough time.

[00:31:42] Karthik Reddy: In the first phase. 

[00:31:44] Deep Kalra: Any early phase. 

[00:31:45] Karthik Reddy: Any early phase. 

[00:31:45] Deep Kalra: I think that in ____ gets you ready for tough times to follow. So, the next few crises, I do not think we really panicked. We knew if we could handle that, we will handle this. And the bonding that it does to the team. 

[00:31:59] Karthik Reddy: Team is amazing. Yeah. 

[00:32:00] Deep Kalra: Yeah. You have gone through the worst of times together, so you say, listen, we will come out of this one and we always did a lot of whitewater rafting as a company sport. So, this is rapids. So, if you can go through a grade five rapid and not flip your raft, you will be fine in all the other rapids. 

[00:32:15] Karthik Reddy: It also reminds me of one thing I have said out as a podcast guest and what I measure when entrepreneurs pitch, which is, are they married to the mission that they set out to do? Deep enough. Because only the mission keeps you alive. Everything else says drop it. 

[00:32:35] Deep Kalra: That is what it was. Common sense. And actually all logic said, we should all go back to our jobs, make much more money out of this thing. But then if everyone did that then, and am I glad? I have to say this very honestly. I would not have been able to stick it alone. 

[00:32:55] Karthik Reddy: Yeah, you needed them.

[00:32:56] Deep Kalra: I needed each one of them actually. 

[00:32:57] Karthik Reddy: Band of Brothers in some sense.

[00:32:58] Deep Kalra: Band of Brothers. Yeah. So you are all giving each other confidence that you are not crazy. There is something here, the numbers are suggesting there is something and we are getting there and everyone’s chipping in with interesting ideas, keeping the team motivated. 

[00:33:09] Karthik Reddy: The value of co-founding teams comes through in those.

[00:33:11] Deep Kalra: it is, huge. So I would never, ever, if I was crazy enough to do. 

[00:33:15] Karthik Reddy: Rajesh, as CFO, were you happy with that? 

[00:33:17] Rajesh Magow: Good question. 

[00:33:18] Karthik Reddy: The situations that Deep was putting you in back then, I know you have evolved so much in the firm. CFO, CEO. But back then, you were running the show. 

[00:33:25] Rajesh Magow: I am glad you, asked that. For some time, by the way, we were also sitting on terrace in porta cabin by the way those days. 

[00:33:32] Deep Kalra: That is true. We ran out of space. We want a port cabin on the terrace. We created space. 

[00:33:36] Rajesh Magow: Where you have typically security guards sitting, that is exactly where we were sitting. 

[00:33:40] Deep Kalra: Slightly larger. 

[00:33:41] Rajesh Magow: Slightly larger, yeah.

[00:33:41] Deep Kalra: We all four, five of us sat in a porta cabin. 

[00:33:43] Rajesh Magow: So, that phase was really tough. And one of the reasons why it was tough was, which is what you are alluding to, that we did not have money. We did not have money, at that point in time. And like Deep was saying that short of stealing, we did everything possible.

There was a point where we had one month money left. Deep in the US trying to raise. I think the most interesting, important point at that point in time. And I think it is our learning and hopefully, the others can learn from you, is to recognize that moment and not necessarily be in the denial mode, but just to recognize that moment that if the market is not ready, market is not ready no matter what you do. 

So you will have to stop. If you just keep pushing the paddle there, you are not going to get the results because the level of digitization was zilch at that point in time. Internet did not really exist. We were early, and we had to accept the facts. One part of it was… 

[00:34:44] Karthik Reddy: You were selling to the NRIs also where the internet was a little more ready. 

[00:34:47] Rajesh Magow: And that was also, by the way, the special fair niche that you were able to get because it was just a niche corridor, but it was on call center. It was hardly on website. And that day, whatever part was there on the website was in the US market where the market was fully developed. 

And I am saying this in the Indian context, internet did not really exist at that point in time. I did not exist and did not take off for five years. 

[00:35:10] Karthik Reddy: Went to a standstill. 

[00:35:12] Rajesh Magow: When we started this conversation, you said 25 years old internet and it is 20 years young internet in India. Literally, it is just not that old. And that was the realization at that point in time. And therefore we had to do everything. And that is why the Ebookers’ deal happened. 

When Ebookers UK was coming to India and they wanted to set up. Their problem was different. They were in an involved market, developed market. Their problem was the cost. And India was a developing into a BPO hub at that point in time.

And they needed a team and they needed domain expertise and they found a match in MakeMyTrip. And and that is why Deep and I was doing some dual role for some time, then I moved the other side and I think that turned out to be actually in the context of MakeMyTrip journey and me coming back home very interesting because I learned to huge.

[00:36:04] Karthik Reddy: Both comes from that. 

[00:36:05] Rajesh Magow: Because it was a matured OTA. And in India, we were able to move pretty much every process back to India for Ebookers UK, the sales process, the post-sales process, the technology process, the finance back office, you name it. We were able to just take it to about 3000 people because the cost arbitrage literally. 

And all what we had to do was to very smartly go there and sell the story and then bring them back here. And there was a huge amount of learning when I came back in 2006. September 2005 is when we launched again.

[00:36:45] Karthik Reddy: Yeah. 

[00:36:46] Rajesh Magow: The real money, $10 million and $10 million was also very big at that point in time. 

[00:36:50] Karthik Reddy: Yes. Very big. 

[00:36:51] Rajesh Magow: When Saif

partners came in, which is when I came back, all the learnings that I had learned there was put to use because market was ready. 

[00:37:01] Karthik Reddy: Yeah. 

[00:37:02] Rajesh Magow: So, I think there are very, interesting learnings during the difficult period as Deep was mentioning. So when you go through the difficult period, then you learner. I think a lot more than you learn when you are going through.

[00:37:17] Karthik Reddy: Get an easy money and… 

[00:37:18] Rajesh Magow: Steady market. 

[00:37:19] Karthik Reddy: For the past five years. 

[00:37:20] Rajesh Magow: And the realization, and sometimes, I believe, there are many new good things that are happening to the, let’s say, this generation of entrepreneurs, but one of the things maybe they can do better is, looking in the past is that you cannot be restless. 

They are younger and they are smartest, and the risk appetite is higher. Maybe they are bolder than we were. 

[00:37:46] Karthik Reddy: Of course. 

[00:37:47] Rajesh Magow: But the restlessness was not there because it takes that much more longer, sometimes it can. Sometimes it could be a… back then, it was a macro issue. But today it could be another issue. So that might come up in the first five years. And then you will have to pivot. So, those are the kind of learning, those are golden years from a learning standpoint, by the way. 

[00:38:11] Karthik Reddy: And then 6 to 11, 12. Another fascinating orbit. So somehow, I do not know, you have to tell us why Ravi fell in love with it. Of course. It was one of his best bets. Big, payday for him, thanks to how well you folks performed. But after that, did you naturally think, oh, IPO is a natural path because inconceivable in those years and again, same thing. 

What were you thinking? What were you thinking as CFO? Just think that, oh, we can IPO this company in a few years. I wish that thinking was more pervasive today. We would have far more courage in putting out companies and then compounding post-facto. So I would love to hear the backstory.

[00:38:56] Deep Kalra: Sure. 2005 to 2010 is our reference, so it is perfect 5 year stories. So one plus four and then five years. We grew organically. Saif partners, which is for the benefit of everyone. Elevation now, and Ravi Adusumalli was… 

So, we had two term sheets. We had Saif partners and we had WestBridge and my friends at WestBridge who I know exceeded, like I worked very closely with Sandeep Singhal on IIM Ahmedabad’s endowment. It is alma mater. 

[00:39:22] Karthik Reddy: Yeah. 

[00:39:22] Deep Kalra: His idea. He, me and Ramesh, three of us have taken it forward. Now VT is also part of it. So Sandeep has never forgiven me. SK jain has never forgiven me and we are both dear friends now and I do not know why, but they were both great offers. 

[00:39:36] Karthik Reddy: Yeah. 

[00:39:36] Deep Kalra: And there were multiple reasons, but it was a very tough choice. And we like all of them and I think we just found Ravi moving faster. Single decision maker. Every Tuesday I think I had to go to Bangalore and pitch or something. So, it was one of those things I spoke to these guys. 

[00:39:53] Karthik Reddy: Intuitive sometimes. 

[00:39:53] Deep Kalra: Yeah, it was intuitive and but I am sure WestBridge would have been an amazing partner too. So 2005 to 2010, we grew 25X.

[00:40:03] Karthik Reddy: Wow. 

[00:40:03] Deep Kalra: We raised four rounds. So Saif on each round. Second round split between Helion and Sierra. because again, we are nice guys and could not say no to one. And I am glad we got both because Ashish and Sanjeev from Helion and we got Tim Guleri from Sierra. Tim is still on our board.

[00:40:19] Rajesh Magow: Still on our board. 

[00:40:20] Deep Kalra: So, Sierra sold out in 2010 after the IPO. 

[00:40:24] Karthik Reddy: Yeah. So he is an independent. 

[00:40:25] Deep Kalra: We requested him to stay on. And he has been a rock. The lesson for everyone is if you get a good board member. 

[00:40:33] Karthik Reddy: Do not lose them. 

[00:40:34] Deep Kalra: Just like a colleague, do not let them go. We just wanted Tim’s wisdom. Also, he brought a very different perspective because he had grown his own company, Sourcefire, taken it public, then been in Sierra, and he is just one of those who gives a 100%. So, all calls are at bad times for him because he is sitting in San Francisco. 

Never grumble, never miss a call. 5:00 AM in the morning, 1:00 AM at night. Tim’s on the call. 

[00:40:57] Karthik Reddy: Amazing. 

[00:40:58] Deep Kalra: He is just amazing. And he is been very, very, useful. We have been very grateful. And then third round was Tiger. 

[00:41:06] Karthik Reddy: Tiger, yes. 

[00:41:06] Deep Kalra: And Lee Fixel. 

[00:41:07] Karthik Reddy: I remember. 

[00:41:08] Deep Kalra: Tiger two rounds.

[00:41:08] Karthik Reddy: He had a great relationship with me. 

[00:41:10] Deep Kalra: Yeah. He is a dear friend and then Rajesh got to know him really well too, because he got Rajesh on the Flipkart board, etc. 

[00:41:16] Karthik Reddy: Yeah, I remember. Yeah. 

[00:41:17] Deep Kalra: And we have to give credit to Sanjeev Bikhchandani who was another independent for us and great friend, philosopher, guide. And I think, if there is to be a benchmark for corporate governance, it is Sanjeev. Learned so much from him. 

And Sanjeev tells us in this board meeting in January 2010 and in his typical style, saw the material, saw the slides, and he says, you guys are ready to IPO. And Rajesh and I looked at each other. I said, really? He is saying, yeah, this was our size and we were 40 million in revenues then.

[00:41:49] Karthik Reddy: That is right. They were actually not supersized when they did. 

[00:41:51] Deep Kalra: We were 40 million looking at 60 million. Profitable because we want super investing in hotel or anything. He is saying, yeah, you guys are ready. We IPO’ed then. Sanjeev, I will not say man of few words, but man of fast words, speaks very fast. 

Americans on the border had to tell him to slow down. They could not understand what he was saying. And so Rajesh and I said, okay, we will do some work. Post the board meeting, we had not thought of it yet. It was there. One thing was very clear.

[00:42:15] Karthik Reddy: You are growing well. You have _____. There was no need to. 

[00:42:17] Deep Kalra: One thing was very clear. We want to build forever. We do not want to sell. We were in it and we said, okay. And we put our heads together and I think next month, Rajesh organized this bake-off meeting. We had bankers, we had lawyers, and and we had auditors. 

So, everyone was there. Morgan Stanley, KPMG, Latham & Watkins. And then S&R in India, everyone together in the room, Trident, Gurgaon and it was the bake-off and Sanjeev warned us list in India, is another story in India versus US if we have time. In India, it will take you one year. US, we do not even know how long it will take you. 

And all the market feedback we got. Our board was split down the middle. So I will tell you quickly. So I took a week off. Rajesh and I spoke to many people. I spoke to at least six people in depth of the experience of listing in US and India. And finally we came to it, e‑commerce model in India is not understood. We were e‑commerce.

[00:43:14] Karthik Reddy: Very early back. 

[00:43:15] Deep Kalra: Unlike, Infoedge.

[00:43:15] Karthik Reddy: That is right. 

[00:43:16] Deep Kalra: Infoedge got their money from companies. 

[00:43:18] Karthik Reddy: Correct. B2B. 

[00:43:20] Deep Kalra: Ours was B2C and we felt we will be better off in the US.

[00:43:23] Karthik Reddy: Better understood, _____ more comps. 

[00:43:24] Deep Kalra: Yeah, and we decided to go. Yeah. And the more comps. 

[00:43:27] Karthik Reddy: More analyst coverage. 

[00:43:28] Rajesh Magow: So, there was Expedia and then there was Ctrip, and we went ahead as the Ctrip of India or the Expedia of India. Slide number 14 on our deck was just the comps. People only want to see that deck. And full credit, I think, to Rajesh, CFO, and his team in six months, we IPO’ed on August 12, 2010, six months from kickoff bake-off meeting. 

[00:43:49] Karthik Reddy: Amazing. 

[00:43:50] Deep Kalra: So, they pitched tent in office. I was thanking KPMG the other day and he was driving them and they just worked relentlessly with a goal. We have to catch the summer. We caught the last week before the break when everyone, all of Wall Street’s gone. Boston’s gone. And we were marketing. We did two-week road show. 

[00:44:08] Karthik Reddy: It is a Hamptons month. 

[00:44:09] Deep Kalra: You know where they are. So, they are clearly not in that office. And luckily for us, we met that window. We priced at 14 bucks and the rest is history. But I want to hear Rajesh’s perspective on it. This is my perspective. 

[00:44:22] Karthik Reddy: Actually, 2, 3 interesting reactions. One is, I used to crib a lot that India VC funded companies still have not figured out that IPO as probably the best long-term partner. 

[00:44:37] Deep Kalra: For sure.

[00:44:37] Karthik Reddy: You are not going to get… if you thought Indian listing was bad, then Indian M&A is probably worse. I know you have bought companies, you have been fair. 

[00:44:45] Deep Kalra: We have done that. 

[00:44:46] Karthik Reddy: Relatively speaking. But I am just saying it is not a great place to go and say, oh, I will get bought for a great price, cash. 

[00:44:52] Deep Kalra: You cannot go out with that.

[00:44:54] Karthik Reddy: And there are not too many cash pockets. 

[00:44:55] Deep Kalra: Exactly. 

[00:44:56] Karthik Reddy: And even you have to structure it in such a way that was stock. 

[00:44:59] Deep Kalra: Of course. 

[00:44:59] Karthik Reddy: And then you engineered exits for everybody. Second is, we started writing some pieces in 19 saying, I know what we are all waiting for. We should be taking more companies public. 

[00:45:12] Deep Kalra: Yeah. 

[00:45:12] Karthik Reddy: And then in 21, the first lot, which were the two of the big ones? Policybazaar and Zomato. 

[00:45:20] Deep Kalra: Yeah. 

[00:45:21] Karthik Reddy: So, I said, Mr. Bikhchandani is behind this. 

[00:45:23] Deep Kalra: I remember reading your piece, by the way. 

[00:45:25] Rajesh Magow: Yeah. 

[00:45:25] Karthik Reddy: And now I am thinking, oh, he was the OG on you as well.

[00:45:28] Rajesh Magow: Absolutely. 

[00:45:29] Deep Kalra: He was. He put the idea in our brain. We might have waited a few more quarters. 

[00:45:33] Karthik Reddy: And it is fascinating that he had a role to play there as well but it is still like very daunting and I know you did not touch upon it, but again, what give you the courage? I know the decision was Nasdaq. But was it easy to do the Nasdaq? Why are more companies doing that today? So maybe, you have excited people now, so tell us why it is not done more often. 

[00:45:53] Rajesh Magow: Yeah. Maybe I can give a little bit more color on that. But the point that you touched upon is a very interesting point. Strategic M&A and strategic sale versus an IPO. Thankfully for us, that was not the issue. We as management team are very clear because from our point of view, and it is not an exit for the founders. 

[00:46:13] Karthik Reddy: It is never for exit. 

[00:46:14] Rajesh Magow: Yeah. It is actually the beginning. 

[00:46:15] Karthik Reddy: We are chatting. 

[00:46:16] Rajesh Magow: It is actually the beginning. 

[00:46:17] Karthik Reddy: That is right. It is a new journey.

[00:46:18] Rajesh Magow: It is a completely a new journey, a new trip. So, it is a great milestone. We wanted to do it and of course, the statute of the company improves, etc. So, from our point of view, management team, the thought process was clear. Investor backing was there. They were very supportive. Board was pushing us as you heard. Sanjeev was telling us that we were ready, etc. But from a timing perspective, hindsight, I can probably say maybe we would touch early because we had built only flights business by them. 

[00:46:52] Karthik Reddy: Still a very and young business.

[00:46:55] Rajesh Magow: Young business and internet was also very easy, although no regrets, by and large, because we had to manage those. See, once you were in the situation, you had to manage the situation. We still had to grow. We still had to manage our investors now, three versus, maybe 20 investors or whatever. 

So we still had to do that. And we ended up going through that journey. But if I had to, just rewind and see that, maybe we should have waited for a little bit more. Perhaps the answer to that would be yes. 

But in terms of just whether it was hard or not so hard to go out there again. I do not know, maybe I would give a lot of credit to the fact that we had experience behind us. When we started the venture, both Deep and I, and Satin and Keyur, we were all corporate professionals. So, we had learned that. So, we were not necessarily young, straight from the college kind of entrepreneurs. So that part was helpful. 

The other very important, and a lot of the people, including Sanjeev, was saying that from a corporate governance standpoint, US is very tough. It could be an overhead because, there are a lot of compliances and stuff like that. Again, for whatever it is worth, that was not our concern and worry.

And the reason for that, and again, there is a very interesting learning for the young entrepreneurs, today because of the fact that they are starting really early. See, we were a little experienced and thanks to… and again, it flows from the top. The reality is when Deep set it up, our board composition as a private company also had independence from the word go. 

[00:48:39] Karthik Reddy: Amazing. 

[00:48:39] Rajesh Magow: Not from a governance standpoint, per se. More for strategic advice and brainstorming standpoint, and sounding board. So we would be comparing with each other, 3, 4, founders, senior management talking to, discussing strategy and all. But how do we get the external perspective? And from where, right? So you need to have some sounding board, our investor, representative directors were there, but we had independent directors from the word go. So, we were not really worried, worried from that point of view to maybe the conviction was coming from that side.

A combination of these two factors that, listen, it is going to be a difficult journey in terms of the sheer amount of work that is required. But not from any other perspective. So, we were not nervous or anything. And let me tell you, it was delightful to work with the US ecosystem, the investors, analysts, and the exchange.

It was just amazingly professional ecosystem that we faced, and I personally loved it because the response time, the decision making, the professionalism with which they approach. Even if you draft your prospectus and you file your prospectus and you get the long list of questions, logical questions, high-quality questions, they will come back to you, which you can address it because you are… 

[00:50:08] Karthik Reddy: And they are rational question.

[00:50:09] Rajesh Magow: They are rational question. And you are quite used to it. Because that is the way you were building the company. That is the way you were running the company. So, why would you be nervous about it? So, I think the ecosystem was really very well-developed. And from that point of view, to be honest, it was very smooth. 

[00:50:28] Karthik Reddy: Rajesh is not taking credit, because you are a kickass CFO who could address this?

[00:50:33] Deep Kalra: I leaned on him entirely because the more we heard SOX compliance and the more, and I said, we have always kept one set of accounts unlike companies I know, which have three sets of accounts, one for investor, one for IT. One set of accounts. Keep it simple. One rule we always learned was if there is bad news, be the first to give it to the board. 

[00:50:51] Karthik Reddy: Yeah. 

[00:50:51] Deep Kalra: So, I said, Rajesh, how tough is this? And he said, we will do it. And I relied on him because we ran it obviously squeaky clean till date.

[00:50:59] Karthik Reddy: Yeah. 

[00:51:00] Deep Kalra: And touch wood, it has never been a problem in the US because it can. I will give you a great example of what he is saying. Two days before IPO, we are right in the end, a company well, which has got their, I think just rewards today. Cox & Kings, tried to derail our IPO.

[00:51:15] Karthik Reddy: Oh, is it 

[00:51:15] Deep Kalra: Flippant complaints, some nonsense, for which I went straight to SEC and it was total bullshit. But they wanted to derail, which happens here too, before the IPO. SEC spoke to our lawyers. Our lawyers explained it to them. We explained it, Rajesh. We are pitching to an investor. Rajesh has to leave. And I am saying, really? 

He needs to go to the loo probably and he was worried and he came back and he told me later, he had to go. He was actually taking a call with the lawyer to tell them we gave our written response. They said. Understood. They just said, like, yeah, wait, this crap happens. 

[00:51:51] Karthik Reddy: Yeah. 

[00:51:51] Deep Kalra: Very mature ecosystem. So, I think you have to give. It is tougher. You do well. You get superbly rewarded. You do not do well, it punishes you hard. 

[00:52:00] Karthik Reddy: Yeah. 

[00:52:01] Deep Kalra: But I think it is very logical, that ecosystem, and there are few players who are always in and out, make a quick buck. But once you get quality, you look at your cap table. You have quality long onlys. It is a delight to go into those meetings. It is tough, but you will get a few nuggets from them after they have done their 45, 50 minutes of questioning, the last 10 minutes. 

[00:52:21] Karthik Reddy: It is all learning for you. 

[00:52:22] Deep Kalra: Phenomenal learning. And they are the same guys who have been talking to Expedia and Booking and Ctrip. And they could give us learnings of what they have got and we would be hungry for that. So, for me it was like first 50 minutes you are parroting ​’cause you are saying stuff what you know, is very boring. 

We would talk in punish. We would try to keep each other motivated by how many times will we not use this word today? And synergy will not be used and all that kind of stuff. But last 10 minutes, you could suck it in. 

[00:52:51] Karthik Reddy: Yeah. Lovely. 

[00:52:52] Deep Kalra: And there was a lot to learn from some of those investors. 

[00:52:55] Karthik Reddy: This is a good time to talk about IDFC FIRST Bank,our season partner. IDFC FIRST Bank has earned its reputation as one of India’s most startup friendly banks through its FIRST Wings program, which provides dedicated mentorship and tailored financial solutions to help early stage ventures scale effectively.

Coincidentally, many of Blume’s portfolio companies, much later stage also partner with IDFC FIRST Bank for their banking and financial needs. If you are well-funded and scaling, they are great lending and banking partners and our portfolio companies would attest to that. 

My favorite MakeMyTrip story. So, Sanjay and me, had just shook hands on partnering. June, 2010. 

[00:53:31] Deep Kalra: Okay. 

[00:53:32] Karthik Reddy: As we are hanging out there, Starbucks, Market Street, and we see a rush of Indians walking across the road with suits. 

[00:53:39] Deep Kalra: Sanjay has told me the story. 

[00:53:41] Karthik Reddy: You were there. 

[00:53:42] Deep Kalra: Sanjay has told me the story with the story. 

[00:53:44] Karthik Reddy: Road Show. Road show. For us, it was like sporting a… 

[00:53:47] Deep Kalra: You were going to the Fidelity office or the Capital One at Capital Office.

[00:53:51] Karthik Reddy: Yeah. 

[00:53:51] Deep Kalra: And he told me this story. 

[00:53:52] Karthik Reddy: He remembers it so distinctly. 

[00:53:54] Deep Kalra: Yeah. A, we had the other problem and our CFO after that Mohit Kabra is also six feet plus. But our director of IR then was Taiwanese-American, Jonathan, who is 5′8″. So, people would say, what is this? We only thought Indians are short and here’s the opposite. It was quite funny. 

[00:54:14] Rajesh Magow: I will tell you Karthik one more thing which is again the learning, I think, and very important to the topic. So a lot of the focus unfortunately goes into the IPO process. To my mind, IPO process is not really an issue.

[00:54:28] Karthik Reddy: Yeah. 

[00:54:29] Rajesh Magow: You will get there. You will have team. You will be able to do it. It is hard work, but you will get there. That is not as difficult. What is important that does not decide the IPO and the success of the IPO is not dependent on the process. The success of the IPO is dependent on the business.

Are you ready to go IPO from a business standpoint or not? Are you ready to sell the story or not? Has your business reached a point where you are confident of going out and selling this story. 

[00:54:59] Karthik Reddy: And predictability and stability. 

[00:55:00] Rajesh Magow: And predictability, certainty. 

[00:55:01] Deep Kalra: That is what the market wants. 

[00:55:03] Rajesh Magow: You cannot be uncertain. You are going into IPO and if you are nervous about and saying, I do not know what is going to happen next 2, 3 years, because my strategy is not clear. My business model is not clear. 

[00:55:15] Karthik Reddy: So, that is what is remarkable that you folks, even in that era, despite all the ups and downs of the first decade, you actually were ready to IPO in 10 years, which not too many companies do even today. 

[00:55:25] Rajesh Magow: Yeah. But that is very important, and a lot of people often ask me, what is the time, how should we do it? And I am saying, first focus on business. And if from a business standpoint. 

[00:55:38] Karthik Reddy: Business, if it looks good, then you are ready.

[00:55:40] Rajesh Magow: Then only you are ready. Then, you worry about the process. 

[00:55:42] Karthik Reddy: The size does not matter as much. 

[00:55:43] Deep Kalra: But predictability, I think that is key. A model is stable, steady. 

[00:55:47] Karthik Reddy: So, last question on that before I get to the next. Let’s come to the next decade as well, very, quickly. Because I think strategy changed. We saw acquisitions. We saw a lot of stories unfold, but today, if you look at a founder, in your shoes, similar shoes. 

And let’s take the business predictability as a given, what would your advice be? Should you actually go to the US or is the Indian market suddenly in the last 5, 6 years matured to the point that the regulator, the analysts, the buyers are suddenly saying, oh, internet, humen samajh main aata hai.

[00:56:18] Rajesh Magow: Yeah, no, it is come a long way. Yeah. So, if you ask me today, a 100% India because ecosystem has evolved. You can see a lot of public companies, a lot of internet business models are already public. The comp sets are available, the analyst ecosystem is available. Domestic institution investors are ready to invest.

Foreign institutions were always ready to invest, right? There is new money that is, and this is like a last five years. 

[00:56:41] Karthik Reddy: Exponentially larger than when you. 

[00:56:42] Rajesh Magow: Last 5 year exponentially larger. It was an era where domestic institutions would not even look at it. 

[00:56:48] Karthik Reddy: Yeah. 

[00:56:49] Rajesh Magow: Today, their sizable portion of investment is going into new age companies. So, I think including the exchange, and the perspective has changed. Market has evolved and, sorry, just one, point that I wanted to make and back then, by the way, Sanjeev also was saying, when Deep was saying board was split. Because Sanjeev was saying, why not India?

Because you are an Indian company, you should. And he had a point there. His point was that you are an Indian brand. 

[00:57:16] Karthik Reddy: Yes. 

[00:57:17] Rajesh Magow: You are a B2C brand. 

[00:57:18] Karthik Reddy: I was coming to that. 

[00:57:19] Rajesh Magow: And you know US market. US market, you do not have retail investors, right? 

[00:57:24] Karthik Reddy: That is right. 

[00:57:24] Rajesh Magow: So, here you get a brand rubber effect because your customers would be buying stock, right?

[00:57:29] Karthik Reddy: Absolutely. 

[00:57:29] Rajesh Magow: So, that advantage is not there in the US market. 

[00:57:32] Karthik Reddy: That is right. 

[00:57:33] Rajesh Magow: So, if the ecosystem had evolved. If we had more internet comms sitting at the Indian Exchange, there was no reason for us to go to US. We were lucky, by the way, again. Deep’s wisdom and maybe our consultants advised on structuring at that point in time that from a corporate structuring standpoint, we were ready.

[00:57:53] Deep Kalra: Yeah. 

[00:57:54] Rajesh Magow: Because we had holding company outside and we could take the company properly. 

[00:57:57] Karthik Reddy: That was easy. Yeah. 

[00:57:58] Rajesh Magow: That was easy. And not necessarily everybody was focused on profitability, etc. because that was supposed to be the internet business model. 

[00:58:05] Karthik Reddy: Yes. 

[00:58:06] Rajesh Magow: But today everybody understands internet business model and the market is also evolved. So, I would… 

[00:58:10] Karthik Reddy: Tell me as a say, out of just curiosity, is there a way to, now you are the CEO, sorry. But is there a way to not flip but bring the ability for Indians to own MakeMyTrip like Indian rupees ​‚is there an equivalent of Indian depository receipt? There was some conversation around it.

[00:58:29] Deep Kalra: You can do it today. Yeah, you can buy on your _____, any of the direct you can buy. 

[00:58:32] Karthik Reddy: You are buying the US stock though. 

[00:58:34] Deep Kalra: Yeah. No, I mean we’re not listed there. But you can buy up to your LRS limit.

[00:58:38] Karthik Reddy: No plans to have a Indian trucks. 

[00:58:41] Rajesh Magow: I think Rajesh should cover. 

[00:58:43] Deep Kalra: No, I will tell you what. See, firstly that the dual listing, rhe reverse dual listing is not possible. If you are an Indian company, listing in India and India and ADR. 

[00:58:52] Karthik Reddy: ADRs, no idea. 

[00:58:53] Deep Kalra: The reverse is not. Reverse is not today. 

[00:58:55] Karthik Reddy: Just to be a lot of talk around it. But it has not happened. 

[00:58:58] Rajesh Magow: Yeah, no, you are right. And there is still a talk around it, but it has not really happened.

[00:59:02] Karthik Reddy: You should push. People want to own MakeMyTrip.

[00:59:04] Rajesh Magow: No, I think what they were trying to do it through Gift City. They were trying to. 

[00:59:07] Karthik Reddy: Yeah, I know there is some talk around.

[00:59:09] Rajesh Magow: Address that issue to an extent, but it has not really happened. It will happen at some point in time. See, from our point of view, again, there has to be an objective. Why do you want to, either have a dual listing or you want to go to the capital market and all. 

And, like I said, the ecosystem is ready. So, let us say potentially if there is a need for us, see today, we are a creative, we have strong balance sheet, we have cash on our balance sheet, so we do not really need to go to another.

[00:59:34] Karthik Reddy: That is right.

[00:59:35] Rajesh Magow: Market. But if we had a need, potentially hypothetically, India will be the market. 

[00:59:41] Karthik Reddy: And, so the next decade, I call it like one of those many Diwali moments in the ecosystem when you bought, redBus in 2013 – 14.

[00:59:51] Rajesh Magow: Ibibo. 

[00:59:52] Karthik Reddy: Sorry, Ibibo bought it. And then, you know there was. 

[00:59:56] Deep Kalra: No, we bought Ibibo which had redBus.

[00:59:58] Rajesh Magow: Yeah. Goibibo and redBus. 

[01:00:00] Karthik Reddy: Yeah, That is right. So Goibibo happened a little later. First they bought redBus. 

[01:00:05] Deep Kalra: That is correct. 

[01:00:05] Rajesh Magow: That is correct. 

[01:00:06] Karthik Reddy: And, then clearly travel seems like a duopoly, oligopoly market. There’s economies of scale. Consolidation is inevitable. But it still takes a lot of courage to integrate assets, buy assets. What made that event happen in 16 – 17? I know it started getting very competitive. 

So, give us the highlights of the next decade, because, yes, more Indians came in with mobile phones and Jio and whatnot. How did it change the travel business? And was that a reaction to the change of the market in itself? Or it was inevitable that this would happen irrespective? 

[01:00:44] Deep Kalra: No, I think that decade, you are absolutely right, right up to COVID was a certain kind of great organic growth. Cheap mobile internet and apps was a big turning point. Big flip. All of that. We were getting the benefits of that as market leader.

I think the whole point about the hotel market. So Air had moved online very well, and airlines were very clear. You cannot discount our fairs, etc. Which we love. We love fair competition. Because then you win on the back of better product, better experience.

[01:01:11] Karthik Reddy: That is correct. 

[01:01:11] Deep Kalra: Hotels is very fragmented. On hotels, we tried every trick in the game, a lot of marketing, a lot of this thing, getting Ranjveer and Alia to say buy hotels online. Except deep discounting. 

[01:01:21] Karthik Reddy: Yeah, we did not believe in it. 

[01:01:23] Deep Kalra: We did not believe in it. We do not believe in it today. He is a CA. I am an MBA. We learned it a very different, so we said, yeah, you can make less money, but you cannot lose money on a transaction. That is crazy business, right? That means if you sell a million units, you lose million into per unit. 

But obviously Naspers had a different playbook, and they had deep pockets and they were able to do this game. And it started in China, I guess this game of, deep discounting, etc. And they brought that to India. I must say that opened the hotel market, created a big problem for us because we were listed. So, if we matched it, our P&L did not look good. If we did not match it, we were losing market share. 

So, we were really stuck between a rock and a hard place. And we tried various things, I think for 18 months, 24 months. And finally, we figured leverage balance sheet and probably what we need to do is really consolidate. So, later when we were chatting with Naspers, with the folks, Pat and all, this was their plan. 

So, they had one plan. They are going to sell to us, but they forced us to buy. I think in hindsight it worked out well, only because of one reason. We both had realized from a couple of acquisitions we had done in the past, particularly those not in India, overseas, if you do not get into it yourself or have someone who is the, what I call karta-dharta of that acquisition, it’ll fail. 

So, we rolled up our sleeves. We decided we have to make it work. It is too big. We did not touch redBus because it was run by two professionals who were doing great job and there was no overlap. We did not have a bus business. 

[01:02:55] Karthik Reddy: Yeah. 

[01:02:56] Deep Kalra: And Prakash and Anoop have been doing it since then and doing a great job. And just get overall guidance from either him or me. Earlier it was me, now it is him. And they know what they are doing now. We look at synergies on buses, etc. But by and large that was very well, run unit, I think great culture too. 

But on Goibibo, there is a big overlap. We could not obviously have everyone. It made no sense. You cannot have two CFOs. You cannot have two this thing. S,o we did whatever we had to do upfront. But then in all fairness, we wanted to embrace all the goodness we got of the brand and actually keep that as a brand and play to its advantage. 

So, when we initially also did our market analysis, we realized the overlap in the brands was not that crazy. It was actually in the low 20%. So MakeMyTrip had a higher income profile. This had a younger and lower income profile and that we cleaved it further. So, now the overlap in the two brands is probably in the low-teens. I do not even know what it is now. 

[01:03:51] Karthik Reddy: Even now. 

[01:03:52] Deep Kalra: Even very clear. 

[01:03:52] Rajesh Magow: Yeah. 25%. 

[01:03:53] Deep Kalra: And yeah. And that I think has really worked, but it took a good year and a half of working hard to make that happen. And that was our KRA, his and mine. And we said, we are gonna make this happen. 

[01:04:04] Karthik Reddy: The founders have to make M&A’s work. 

[01:04:06] Deep Kalra: Yeah. And such a big one. It could have brought us down. 

[01:04:08] Karthik Reddy: Yes. And huge money. 

[01:04:10] Deep Kalra: The toughest thing is people always. See, we all know M&A on.

[01:04:14] Karthik Reddy: On paper, it is easy to do. 

[01:04:16] Deep Kalra: On spreadsheet and PPT, it looks very sexy. 

[01:04:19] Karthik Reddy: Yeah. 

[01:04:19] Deep Kalra: And investors like you are saying, oh wow, this is great. Looks A plus B is equal to D. It is wonderful. The moment you have to make it work on people… because every individual has his or her aspirations. 

[01:04:29] Karthik Reddy: Yes. 

[01:04:29] Deep Kalra: So, how do you figure out who is gonna be there and not be there? And when you bring in people, I think we said all along, it is a merger and we really treated everyone, in the same way. 

[01:04:39] Karthik Reddy: I am glad. Again, it is a great player. It is a playbook an example in case study. 

[01:04:44] Deep Kalra: Big learning. 

[01:04:44] Karthik Reddy: For Indian tech. We do not have too many of these stories.

[01:04:47] Deep Kalra: Normally, you end up losing all the goodness. 

[01:04:49] Karthik Reddy: Yeah. Either that or the differential in mindset is, oh, I have to be deeply acquisitive and.

[01:04:56] Rajesh Magow: Exactly. 

[01:04:57] Deep Kalra: Yeah. We just looked at it from their point of view and we said there was such good talent. They had some tech folks and product. We still have a lot of people from that. 

[01:05:04] Karthik Reddy: Fantastic. You know that I was coming to the culture. 

[01:05:07] Deep Kalra: Class CTO, in Vikalp. We had another guy, Rahul, both of them helped us build. They built Aarogya Setu. We had some really great people. Parikshit isstill with us in the leadership team. So, I think we tried to get the goodness, and we wanted everyone to stay some event. 

[01:05:23] Karthik Reddy: How many acquisitions lifetime you think approximately? 

[01:05:25] Rajesh Magow: Quite a few investments now, but I, just wanted to make one or two important points here on this. Admittedly, we were not ready. This was a very big one for us. We were absolutely not ready as business. So what was the driving force for us? 

The hotel market had not really taken off. Flight business was steady, stable, profitable, etc. Hotel market had not really taken off. We had invested quite a bit into the hotel market and it was taking time because… the game changer for that, by the way, was mobile market, the app world. As we got into the app ecosystem, it started to take off. 

I think what was getting threatened and, in MakeMyTrip, it is almost like a culture, so if there is one goal that we have never compromised is the market leadership. I was getting threatened there only because someone was coming and disrupting the market using price as a lever and negative unit economics. Now how do you counter that? Like Deep was alluding to. We had no DNA for that.

In fact, and we were a listed company on top of it, right? And first couple of quarters, we were saying, listen, what to do? 

[01:06:39] Karthik Reddy: Yeah. 

[01:06:39] Rajesh Magow: And then, we said, oh my God! And we, actually went and raised more money. 

[01:06:44] Karthik Reddy: Yeah. 

[01:06:44] Rajesh Magow: And we started actually playing that playbook. 

[01:06:48] Karthik Reddy: A lot of companies of you ilk started doing that. Even Naukri, if you remember, their first issuance after IPO was to content with housing? 

[01:06:55] Rajesh Magow: Yeah, exactly. 

[01:06:56] Deep Kalra: If that is what you do, because this your term. You are losing ground, it is actually. 

[01:07:00] Rajesh Magow: You had to attack. You had to react, you had to play the same game. And that is when the consolidation move. So, it was an expensive consolidation move. It was not. 

[01:07:10] Karthik Reddy: Yeah, no, it was not cheap. 

[01:07:11] Rajesh Magow: It was not cheap at all. But then once you had made that move today, there is no regret because it is actually worked out because then after that, the hard work started. 

[01:07:21] Karthik Reddy: Yes. 

[01:07:21] Rajesh Magow: It took two years for us to get everything going. From an integration standpoint, it was not easy from people’s standpoint, and we had to spend like hours and hours into that. And then technology at the backend and the supply team, etc. The unification took three years for it to come along. So, from that perspective it was really hard. 

But once you had made that decision, then you had to make it work. But if you do not make it work, then it is a double whammy. One, it was very expensive. 

[01:07:49] Karthik Reddy: Yes. 

[01:07:50] Rajesh Magow: And two, if you do not make it work, then you are completely lost. 

[01:07:54] Karthik Reddy: So, I know last five years have been, I think post COVID, the stock’s been on fire. But if you go back that decade, it felt like a rollercoaster ride. And I know the best of public company CEOs and founders will say, we do not look at the price. But how tenuous was that journey? It is not easy to be a public company founder. Manage expectations in the firm. 

[01:08:20] Rajesh Magow: No, it was quite difficult. It was quite stressful. 

[01:08:24] Karthik Reddy: Yeah. 

[01:08:25] Rajesh Magow: But, yes. Sometimes it might be just a cliché statement to make and saying, do not look at the stock price and all. Of course, you will see once in a while and you have to see it. But I think, the journey was tough because, and that is why I was making the point earlier, hindsight, if we had to wait before we go public, we should have done that. 

But that is one important thing because then you have more sort of elbow room flexibility for you to be able to play that kind of game. Because one part of the market was ready and we took off. It was stable, but the other big part of the market, which there was high margin, more defensibility, was not really ready. 95% of our business at IPO was flights. And today it is 50: 50. So, that important 50% we had not really even started. So, that is very important point. 

The other thing that the entire chaos happened because it was an underpenetrated market. It needed more investment to open up the market. And then the consolidation move happened in between. Now, it was very natural for investors to get nervous. Every time, we will go out and of course, we will have some credibility. Both Deep and I will go and sell the same story, and we say, please have faith and patience, and we will get there.

But at the end of the day, we had to deliver. And we were not able to deliver. So, I will tell you the important point, very, very important point during the difficult phase when you are a public company, when you have to manage investors, was that you are the closest to the business. Investors are not. 

So, investors might go through this phase where they may go up and down in terms of just having faith and trust in your story, and therefore, the stock moment will happen. 

[01:10:18] Karthik Reddy: Yeah. 

[01:10:18] Rajesh Magow: Effectively, that is what happens. Because they might take a view. Some, they have their own compulsions and saying, listen, I can put this money somewhere else and I will get faster return, etc. And there are many things that can happen. 

But because you know exactly the reason why it has not taken off and you are in control of that situation because you are dealing with it, it is only a matter of time that you know, then you have to continuously keep going and not worry too much about that.

Because then it will fall in place eventually because it was just a matter of time. And it is so interesting, although the last five year journey has been, in terms of, call it delayed gratification or whatever, but the reality is just before COVID, we had turned it around. 

[01:11:04] Karthik Reddy: Yeah. 

[01:11:04] Rajesh Magow: And COVID happened. That was just. 

[01:11:08] Deep Kalra: As black swan as it can be. 

[01:11:09] Rajesh Magow: As black swan as it can be. 

[01:11:10] Karthik Reddy: I was coming to that. What are your best COVID stories? I know we had many travel businesses, which had revenue go to zero literally in that month. 

[01:11:16] Deep Kalra: We reported a quarter, we were down 96% on revenue.

[01:11:19] Karthik Reddy: Holly Cow. 

[01:11:19] Rajesh Magow: Yeah. 

[01:11:19] Deep Kalra: So, I started the call by saying this should be called a lack of earnings call. No one, found it funny. But the whole world of travel had imploded. 

[01:11:28] Karthik Reddy: Yeah. 

[01:11:28] Deep Kalra: And one investor asked, where did the 4% come from with a national lockdown. Those were emergency stays and emergency travel that was happening. Hotels were turned into isolation base, etc. That was crazy. And I think the toughest time, so here’s the thing, at during COVID, our challenge was not existentialism. I think we had $450 million on the balance sheet. 

[01:11:50] Rajesh Magow: 250. And then, we raised $250 million. 

[01:11:51] Deep Kalra: We raised, sorry. So, we had no this thing that we will not. We will be fine unless COVID continues forever, then the whole world is going to hell anyway. 

[01:12:00] Karthik Reddy: Yes. 

[01:12:00] Deep Kalra: So, we knew we would survive. It is to keep people motivated.

[01:12:03] Karthik Reddy: That is what, yeah. 

[01:12:04] Deep Kalra: And a lot of our talent, the best of our talent, the tech and the product and the online marketing and the finance folks, and it is all fungible. 

[01:12:12] Karthik Reddy: Yeah. 

[01:12:12] Deep Kalra: They could go anywhere. 

[01:12:13] Karthik Reddy: Yeah. 

[01:12:14] Deep Kalra: And Zomato was on fire, others were on fire. So, we were losing people and we had to keep them gainfully employed and keep the motivation. 

[01:12:21] Karthik Reddy: Motivations going.

[01:12:22] Deep Kalra: So, a lot of stuff was going on and Rajesh had new projects they worked on. Ad Tech was a baby of that time. Homestay something, which I always thought was a good idea. No one took me seriously till finally everyone said, oh, home stay. People want to live alone. Homestay became important for us. 

We built a lot, we did work on, the unification. Aarogya Setu was built, which was no money, but team was so motivated. So, there were good 20, 25 people working only on that during the first wave. So, I think a bunch of stuff cost rationalization with the fervor. Go back towards the wall and you really realize where every penny is going.

And then when you have to bring it back, then you are very miserly about it. 

[01:12:59] Karthik Reddy: Yeah. 

[01:12:59] Deep Kalra: So, between Rajesh and Mohit, the CFO, they said, now we are going to measure every dollar where it is going, every Rupee. 

[01:13:04] Karthik Reddy: So, amazing culture reset happens. 

[01:13:06] Deep Kalra: So, yes. And so actually you end up with a much better cost structure when you come out of it and we have seen this and I think everyone who is there, even if you are not a market leader, if you are a solid company, every crisis which hits the whole market, the best companies will come out stronger because we cannot actually compete. 

And the best will actually figure out ways of stretching that dollar. And my biggest advice to all entrepreneurs is hang in there. 

Because things change. Rajesh said, the market changes, various things change, but you got to be there. The most underrated value people say, of course, perseverance, resilience is just showing up and being there. 

[01:13:44] Karthik Reddy: Yeah. 

[01:13:45] Deep Kalra: People are not there because they pack up and they say, oh, I could be earning a crore a year or I could be doing whatever. No, hang in there because things will change and if you are ready, you will get the opportunity and you will strike gold dust when others are still this thing. And that typically is some magic, which is under the hood. 

[01:14:02] Karthik Reddy: But there also seems to be… I am gonna cut over the culture and then we will finish off with your 25-year high that you are on right now. But this seems to feed into 2, 3 things we have heard about your culture, which is when actually the market has this turmoil. you would always have tended to double down is what we hear. What gives you that courage? Was it always that you had already built up reserves and you were smart doing that and that gave you the edge over your competition or… 

[01:14:29] Deep Kalra: I do not know if it is that. I think just from a DNA point of view, the one thing common, definitely two of us. But even if I look at the rest of the team leadership team and the earlier co-founders, I do think crisis brings the best out of us. 

[01:14:41] Karthik Reddy: Just the DNA. 

[01:14:43] Deep Kalra: I really think so. So, it is terrible, but then you really rise to the occasion.

[01:14:48] Karthik Reddy: Because you have had six, seven of these moments. 

[01:14:49] Deep Kalra: Enough and hopefully no more. But it brings the best and we have seen that in our team. And I think what you need is great comradery. 

[01:14:57] Karthik Reddy: Yeah. 

[01:14:58] Deep Kalra: You need trust in one another. In the full leadership team, I am saying yes, everyone needs to trust each other, not second guess them. And at one level, you have got to have the belief, this too shall pass, but will you come out stronger?

So, that famous saying about whoever’s swimming without trunks on and all that. So, we have seen that. And I am not saying we are ready for anything, but we are definitely tougher, stronger that these thing, nothing is going to last forever. A tough time or a good time. 

And that point, you and Rajesh made earlier is so true. In good times, your head is up in the clouds, you are winning, you are not learning. You are learning only when you have got whacked. You are down and out and you are saying, why did this happen? No one says, why did it happen when you win? No one had you say, you won. You were so good. Or the recent, we cannot have a podcast without a cricket analogy, at least with 2, 3 of us.

[01:15:49] Karthik Reddy: Yeah. 

[01:15:50] Deep Kalra: So, you look at the last series. What we will remember forever is the draw that we iked out. 

[01:15:55] Karthik Reddy: That is right. 

[01:15:55] Deep Kalra: Of course, the win, but that draw we iked out was so crazy and so much to learn from it. And even that loss in the end, oh my god. You will never forget Siraj in despair and Siraj in Triumph.

[01:16:07] Karthik Reddy: Yes. 

[01:16:08] Deep Kalra: But there was so much learning where when you won, you won. You won the World Cup. You won the World Cup. Arre bahut accha hua. Subne accha khela. So, I think we all as companies need these knocks to really reflect. 

[01:16:20] Karthik Reddy: The corollary of culture. Like you have so many folks, seemingly 5 years, 10 years, 15 years. What keeps them going? Do you deliberately like refresh culture, refresh their roles? What motivates them? Or is it wealth creation? What tips for founders? 

[01:16:36] Deep Kalra: Rajesh should comment what he does not tell you. While he was CFO, I think he was also HR. 

[01:16:41] Karthik Reddy: Oh, is it? 

[01:16:42] Deep Kalra: So, no one has more patience, I am not taking away from a CHRO now. But no one has more patience than him. I will meet people and I will run out of patience after a while and say, okay. He has, I do not know how much time and patience and really this thing, so we should ask him this question. 

[01:16:58] Karthik Reddy: So, yeah, I would love to hear. 

[01:17:02] Rajesh Magow: I wanted to just add one point to the previous conversation. It is very important because during COVID what happened? Because one part of it was just the resilience in us. So, the best comes out of us during the tough period. 

But in this particular phase, what happened, as I was alluding to earlier, right? Our core business, we were in control and we had completely turned it around. Market dynamics were sorted, etc. just before COVID. So, we were confident on the fundamentals of the business and the pillars of the business. 

So, all what we had to think about was, okay, post COVID and when the market comes back, we will rebuild that. So, you weather that storm and that you weather it, cost rationalization, automation, opportunities, etc. The thought that was driving for doubling down was that we are going to lose this two years, if not more. And therefore, how are we going to make it up as we come out of it? 

[01:18:00] Karthik Reddy: Yeah. Because once you slip, coming back up is very tough. 

[01:18:03] Rajesh Magow: Very hard. One part of the job will be rebuilding it, resurrecting it. So, if your pillars are strong, fundamentally you are strong, you will be able to rebuild it. Brand was very popular, strong customer experience was great, etc. But how am I going to make it up for the growth because the new avenues, etc., that drove and we had resources at our disposal. 

And the last thing that we want to do, and it was not existential crisis for us to take difficult calls, right? We ended up taking some, which were very difficult moments for us. But then we said, okay, use this lull period when the action is not there to double down on new areas of investments.

So actually, I think the number of projects that we ended up doing during those two years. I do not think cumulatively we would have done it in the last 10 or 15 years. 

[01:18:58] Deep Kalra: Yeah. Because no daily fire to distract you. 

[01:19:01] Rajesh Magow: Exactly. 

[01:19:01] Deep Kalra: That is the reality. You want your tech resource on the best thing, but every off days, they say, there is something breaking. Something’s this thing. So, this will just, yeah. 

[01:19:09] Rajesh Magow: Yeah. So, on the culture, I will tell you. 

[01:19:10] Karthik Reddy: Never lose a good crisis is what? 

[01:19:12] Deep Kalra: Never lose a good crisis. 

[01:19:13] Rajesh Magow: Because it is an opportunity. It is an opportunity for us. And it worked out well. 

So, on culture front, I think your point is really valid because our retention rate has been quite high. And it does not happen just like that. And I think it just, again, you set it up, but then everybody has to participate and contribute to it. And a couple of things. I think the general environment, by the way, at MakeMyTrip is very sharing and caring kind of an environment.

And during crisis also, we are all together. We are talking to each other and caring. 

[01:19:50] Deep Kalra: And cracking jokes. 

[01:19:50] Rajesh Magow: And cracking jokes, which is the second part, which is also fun at work, even during crisis. So, we would have our anxious moments, but you know, guess what? We will still be cracking jokes amongst us because, other way, there is no other way to deal with that stress.

The other very important, and that, by the way, a lot of the credit should go to the gentleman sitting out here. No, it is just the sharing of wealth, the number of people and that was the proud moment and I know for Deep, and I know for, me personally as well, when we IPO’ed we had 75%, 80% of our people who had ESOPs.

It was so widespread. People did not even recognize the value of that paper thing back then. There were very interesting examples where people were figuring out, oh my God, suddenly that paper has become very valuable, which is like an HR letter. 

[01:20:43] Karthik Reddy: Yeah.

[01:20:44] Rajesh Magow: Giving them some ESOPs or whatever. And that culture continued. So, it was not always saying that listen we are working it together, building it together. Can we also share? 

And I think and that is what happens. So, let us say, we had difficult moments, but at the top 150 people, they had spent 7, 8 years, but we had not really gotten the same benefit in terms of wealth creation, opportunity, etc. Let us wait because it is bound to come at some point in time and wait, and then, the magic happened. 

So, I think that also was very important and also about letting go, hiring better than, yourself. Having a very collaborative culture, listening to people, etc. that goes a long way, in terms of building, I think scalable organizations. So, we have been very lucky with our leadership team. 

[01:21:42] Karthik Reddy: Yeah. 

[01:21:43] Rajesh Magow: Across the board where the retention.

[01:21:46] Karthik Reddy: I know both of you are doing a great job of rewarding a lot of your leadership team, but I am going to give you extra credit, both of you specifically ​’cause also I realized, we were doing a episode on Indigo. 

And Aditya Ghosh was chatting and just came up in the conversation in this fashion that it is also sometimes serendipitous that it takes a very specific combination to pull off everything. And if it was not Gangwal and Bhatia, almost like two individuals on the planet. Any other combo you might not have had Indigo and I am going to leave you both on a high, 

[01:22:23] Deep Kalra: Wow, thank you. 

[01:22:23] Karthik Reddy: Any other combo, I do not think we would have had to MakeMyTrip. 

[01:22:25] Deep Kalra: No, That is very kind. 

[01:22:27] Karthik Reddy: I think it is simplifying, fantastic journey. And I want to end on a high end ask you this question because I was just looking at the numbers and I know, I remember Rajan, I think, once had said, you will have a travel company in a MakeMyTrip, which compounds now that there is a point where the business is established. 

Now, it is about… they grow with India and see it will become a $10 billion company. This is about five years ago. 

[01:22:51] Deep Kalra: I know. 

[01:22:52] Karthik Reddy: Yeah. So full credit to him. 

[01:22:53] Deep Kalra: Oh, Rajan has been amazing. 

[01:22:55] Karthik Reddy: And so in those five years we have seen that trajectory and then I was looking at it almost give or take any given day $10 billion of market. Almost at a billion dollars of revenue, almost at a hundred billion dollars of profit. And so if you are a statistician and you love cricket, it is like seeing a thousand run innings finally come to play. 

[01:23:16] Rajesh Magow: That is true. 

[01:23:17] Deep Kalra: Nice. 

[01:23:17] Karthik Reddy: In various ways. Remarkable but what next now, 25 years done, and I know you have seeded and become the chair person, and Rajesh has done a fantastic job of continuing the legacy. What does the future look like for MakeMyTrip? 

[01:23:33] Deep Kalra: Okay, I will give you my view as non-executive chairman and then I will give you. So, what I would like to see. I cannot even still think of it as only board position. 

I do believe that the AI opportunity is, it is the internet opportunity plus the smartphone plus mobile internet plus app all rolled into one on steroids, which means it is also a big threat.

We are doubling down, otherwise, some kid in some garage is going to come and eat our lunch. Fundamentally, I believe that. 

[01:24:08] Karthik Reddy: Staying paranoid. 

[01:24:10] Deep Kalra: Totally. I am in Andy Grove’s camp, stay paranoid and I am always telling the guys and I am always pushing and I love testing our own product. And I have to say this, two days ago, I made my first booking speaking in Hindi only to our chat bot, which is lovely. Real booking, not a test booking. I was great and 90% was great, but 10% there was feedback. 

[01:24:31] Karthik Reddy: Of course. 

[01:24:31] Deep Kalra: Which my guys are now tired of my voice notes system. I type. I give a long, long this thing, but I think we need to keep doing that. 

[01:24:38] Karthik Reddy: Never get complacent there. 

[01:24:40] Deep Kalra: So, I think, not just Rajesh, our CTO, our CPO, they all seized with this whole thing on AI. And I think we have to almost like. For us, we were on desktop, I remember, and I have no shame in admitting this. 

We were losing on UX to Cleartrip. They were beautiful on desktop. And I was tired of Ashish Gupta, various guys telling us this. Sanjeev Singh and I am saying, oh. The moment app moment happened, we said stop everything. Only app. 

[01:25:06] Karthik Reddy: To win. 

[01:25:06] Deep Kalra: And on app, we never looked back. And not that we are competing with them, we just said, listen, beast. 

[01:25:10] Karthik Reddy: It is a moment, you do not want lose them. 

[01:25:12] Deep Kalra: Be like. Wayne Gretzky be where the puck is gonna be. 

[01:25:16] Karthik Reddy: Awesome. 

[01:25:17] Deep Kalra: And not where chasing.

[01:25:18] Karthik Reddy: I know we did not get time to touch AI, but we got the answer.

[01:25:21] Deep Kalra: So, that is my role now. And I am very happy to tell them, guys, we gotta be there. I could be wrong, but I will keep on pushing them. And then Rajesh will tell you how to execute.

[01:25:28] Karthik Reddy: The CEO… 

[01:25:29] Rajesh Magow: But I will tell you, if you really look at it, just from an India macroeconomic position point of view, and a lot of people would say today, the next 20, 30 years is going to be India’s moment.

[01:25:41] Karthik Reddy: Yeah. 

[01:25:42] Rajesh Magow: No matter what. Plus minus will happen, cycles will come and go. 

[01:25:44] Karthik Reddy: Yeah. Correct. A few years. 

[01:25:46] Rajesh Magow: Yeah. But from a long-term perspective, it is a very, very interesting phase. In fact, in many ways, therefore, the best is yet to come. And if we do not do what Deep was just saying That, we stay agile, we stay active, we continue to keep innovating, then we would lose this beautiful foundation that we built over 25 years. 

[01:26:13] Karthik Reddy: Yeah. 

[01:26:13] Rajesh Magow: But if we continue to keep doing that, the best phase is going to be future because the hard work is actually pretty much over in terms of just building blocks. 

And now it is the time for you to be able to just tap into that opportunity? Because the macroeconomic drivers are in your favor today. You look at the income growing and the disposable income, the consumer habit changing, specifically to travel and tourism, taking more trips than ever before.

And you look at those cohorts and people are upgrading from basic to mid segment to premium. What else can you ask for? We have gone through that phase and we have built this business where it was really hard. We used to have 20 million credit card base. We today have 110 million credit card base. Digitization, backend and so on. 

[01:27:12] Karthik Reddy: I am loving Rajesh’s enthusiasm. He is saying you have not seen anything yet, and it is like FedEx from here. 

[01:27:17] Deep Kalra: Absolutely. Actually all believe that, to be honest. We really do. We really do. 

[01:27:21] Karthik Reddy: Awesome. It has been a delight to have both of you. I was hoping for exactly something like this.

[01:27:28] Deep Kalra: Nice. 

[01:27:29] Karthik Reddy: The idea was to go mine the history that a lot of people have forgotten. I think this is one of those OG stories that yes, I know, it is our 25^th anniversary, so you have gotten a lot of mileage this year, but it was all due and I think this conversation to me was about going and mining those and saying to founders that, Hey, it takes that long to actually build, super resilient market leader in the country. And is that your goal or not? 

[01:27:56] Deep Kalra: Exactly. 

[01:27:57] Karthik Reddy: So, if it is not, it is okay. It is not for everybody. 

[01:28:00] Rajesh Magow: That is the choice. Yeah.

[01:28:01] Karthik Reddy: But that is a choice that you have to make if you want to emulate them. So, thank you once again. Just before I let you go, I am going to ask some fun rapid fire questions.

[01:28:08] Deep Kalra: Okay. And I want to say thank you for doing this because I love the way you have taken out time from, you know what? you are very busy yourself, but it is nice to see investors, very rarely do investors do this and well done. 

[01:28:19] Karthik Reddy: We found it incredibly enriching for founders, our conversations. Right?

[01:28:24] Deep Kalra: Oh, great idea. 

[01:28:24] Karthik Reddy: And now, we referred to as Deep service. 

[01:28:26] Deep Kalra: But it is a lovely give back. I am glad you are doing it. 

[01:28:29] Rajesh Magow: Absolute give back. 

[01:28:32] Karthik Reddy: One word of phrase in which you would describe each other? Anyone can go first. 

[01:28:37] Deep Kalra: Okay. So Rajesh, I would say is super dependable. Two words, 

[01:28:42] Rajesh Magow: Embarrassing moment for both of us. Deep is a perfect leader. 

[01:28:46] Karthik Reddy: Awesome. And COVID’s hardest call in one sentence? If you had like anything that stood out. 

[01:28:54] Deep Kalra: I think just keeping people’s spirits up at all levels, not just our employees, but even what is happening with their families. And that was the most toughest part for me, for COVID.

[01:29:03] Rajesh Magow: Yeah. I guess the most difficult decision that we had to also take were to convert our 20 company-owned centers for holidays, packages into franchises, which means that we had to let go. I think that was really the most difficult one for sure, especially the kind of culture that we have always, thrived on.

[01:29:22] Karthik Reddy: Favorite holiday destination. 

[01:29:24] Deep Kalra: Keep going back should be favorite, so then it is probably Maldives. 

[01:29:27] Karthik Reddy: Okay. 

[01:29:27] Deep Kalra: But typically seeking the new. So for me, it is seeking the new, like wild, crazy, offbeat. 

[01:29:35] Rajesh Magow: Okay. For me it is a recency effect. It is actually Queenstown in New Zealand.

[01:29:40] Deep Kalra: Oh wow. 

[01:29:40] Karthik Reddy: Oh, is it? Okay. 

And one metric you would like to track. I know you brought it up in the conversation, but if you have a different answer, the same one. One metric, if you could only track one. 

[01:29:50] Deep Kalra: Only one. Oh boy. I guess overall conversion then for me is, yeah, still the most important, unit economics, everything’s important, but one is tough, but I would still be… I am a big fan of conversion improvement. Unaided, no coupons. 

[01:30:09] Rajesh Magow: It has to be for me on customer focus. So, I would say repeat rate. 

[01:30:14] Karthik Reddy: Repeat rate. 

[01:30:15] Deep Kalra: See, between us, we have it covered. 

[01:30:16] Karthik Reddy: You have it all covered. 

[01:30:17] Deep Kalra: By the way, you did not comment on our unintentional dress code. Can you imagine? I texted Rajesh in the morning. 

[01:30:24] Karthik Reddy: It is meant to be. 

[01:30:24] Deep Kalra: No, I said Rajesh, is it a t‑shirt, shirt, or blazer. 

[01:30:28] Karthik Reddy: Yeah. 

[01:30:28] Deep Kalra: And he said just shirt I guess is fine. And we end up in the bloody same colors, almost same. 

[01:30:32] Karthik Reddy: Almost same. 

[01:30:33] Deep Kalra: And blue pants, almost. Unbelievable. Embarrassing but good. 

[01:30:37] Karthik Reddy: Yeah. No, it is fantastic to see that sink cosmically. 2000 to 2025, like what has changed, what advice changes for founders in these very dramatically different startup environments?

[01:30:50] Deep Kalra: I think the market is ready now so you can hit the ground running. Your proposition has to be world class. So, your product offering and proposition has to be world class. India, best in India is not good enough. Today, is a global market. I think you have got to be like very, very good on your tech side. We were lucky we were where we were without a tech founder, we got that far. 

[01:31:16] Karthik Reddy: That is a big difference today. 

[01:31:17] Deep Kalra: Yeah. Today there is no hope for that. 

[01:31:19] Rajesh Magow: Yop know what has changed dramatically is actually the availability of capital. If you compare for 2000 and especially with the young new-age companies. Today, that is not really an issue. 

[01:31:32] Karthik Reddy: One hour and you get term sheet. 

[01:31:34] Rajesh Magow: Exactly. And big checks, right? 

[01:31:36] Karthik Reddy: Yeah. Big checks. 

[01:31:37] Rajesh Magow: So, that is not really an issue. So you do not have to worry about it. Early days, we have to sweat it out, but I do not think you have to worry about it if your obviously business is good ideas, good and all. I think the other one has to be long-term thinking. You cannot be restless. 

Again, you can make your choices and every choice could be good from your perspective, but if your goal is to just build a business, sell it in 5 years, it could be a completely different, but if you are really, thinking about, especially country like ours, it does take a really long time to build long-term sustainable business. So, long-term thinking.

[01:32:13] Karthik Reddy: It is difficult to simulate. But if you were back in your late twenties, both of you, and you are sitting in 2025, and now we have to look at 2050, what would you choose to build? 

[01:32:23] Deep Kalra: Pure play AI company in travel.

[01:32:26] Karthik Reddy: In travel? 

[01:32:27] Rajesh Magow: I think it has to do something with technology because the power of technology, not today, it is AI, Gen AI put 10 years down the line, could be anything, but it had to be around technology, not necessarily maybe brick and mortar. 

[01:32:41] Karthik Reddy: And last question. Most underrated destination in India for travel? 

[01:32:47] Deep Kalra: Actually I think it is, between Ladakh and Andaman. I have also been to Lakshadweep and it is going to open up beautifully, but I think these two are just unbelievable.

[01:32:57] Rajesh Magow: I think Northeast is underrated and under visited, underappreciated quite a bit. All four. Sikkim. 

[01:33:04] Karthik Reddy: Everyone who is listening MakeMyTrip is open for bookings. 

[01:33:07] Deep Kalra: Yeah, absolutely. 

[01:33:09] Karthik Reddy: Book and head there. Again, wonderful. 

[01:33:11] Deep Kalra: Great. Thank you so much. 

[01:33:13] Rajesh Magow: Thanks. Thank you so much.

[01:33:15] Deep Kalra: Thank you. 

[01:33:16] Karthik Reddy: Both of you get like a nice little, set of rings from Ultrahuman. 

[01:33:21] Deep Kalra: Wow. 

[01:33:21] Rajesh Magow: So, I know your users of other tech as well, but give it a shot or gift it to your wife or kid or 

[01:33:28] Deep Kalra: Thank you. 

[01:33:28] Karthik Reddy: Yeah, so we have sizing kits. You just have to size yourselves up and maybe, I know you are not married, but in the way you are, so you can exchange.

[01:33:36] Deep Kalra: We will have exchange. Thank you. 

[01:33:38] Rajesh Magow: Thank you. 

[01:33:38] Karthik Reddy: And a little token of our appreciation. This is for Rajesh. 

[01:33:44] Rajesh Magow: Thank you dear. 

[01:33:45] Karthik Reddy: And this for Deep. 

[01:33:46] Deep Kalra: And this? 

[01:33:48] Karthik Reddy: This goes inside. 

[01:33:49] Deep Kalra: Oh wow. Thanks.