Prashant Pitti on being curious rather than cautious, finding talent in-house, and taking the hard call of postponing a carefully planned public listing
- Episode 7
- Reading Time
- 45 minutes
In this episode, Karthik B. Reddy sat down with Prashant Pitti of EaseMyTrip to talk about his journey from IIT Madras and working in the US to returning to the homeland and starting up with his brothers.
This transcript was AI-generated and went through multiple rounds of proofreading. However, there might be a few errors that may have slipped through the cracks.
[00:01:19.26] Karthik: It's great to have you here with us on the podcast, X-Unicorns, which Blume is launching this year, and it has been a longstanding idea now to have you on this podcast since we first met and discussed your journey, and we would love to introduce you to our audiences today. Prashant Pitti is the co-founder of EaseMyTrip. About 14 years ago, him and his brothers, I don't if it was a garage startup, but started off somewhere and built against the odds, one of India's leading OTAs today, and it's a listed company, as some of you may know, and it's been a phenomenal journey. What I want to do today is to discover more about Prashant's journey and some of the challenges and opportunities that he has taken into his stride and built this phenomenal company.
Welcome again and would to start off with the trivia that maybe a lot of people don't know. So when they look at an EaseMyTrip, they're probably thinking, yeah, one more of those something trip companies, which has probably raised a whole bunch of capital, etc. and it's amazing to know that there is this company which is now publicly listed and never ever touched venture capital money. So let's go back, rewind perhaps to right to the beginning, and if you can walk us through, where these beginnings started as a family? What was the business? I know you come from a business family. Why did you decide that you wanted to go to an IIT? And then post that wasn't the natural push to go and get a job and how did that journey eventually reach the point where something called EaseMyTrip happened?
[00:02:50.19] Prashant: Actually, there are too many questions.
[00:02:52.21] Karthik: Yeah, but I'm just trying to understand the Prashant Pitti of early 2000.
[00:02:55.14] Prashant: No, I'm happy to talk away. Thanks for having me on the show. I would also like to understand what this X-Unicorn means. What's the X-factor over here? But yeah, grew up in a middle-class family. My father has always been coal trader. In fact, since my fifth grade, I have been an accountant. I used to write his ledgers. I got into finance quite early in that sense. I actually knew which months we should celebrate and which months we should not ask for any favors from the dad because I knew what profits and losses we were making on monthly basis. Grew up in a humble but decent upbringing.
How did IIT happen? IIT doesn't happen. For me, it was honestly speaking more of a challenge than anything else. I was pretty much into sports and in my class, I would always be the third ranker or fourth ranker. Never the first two, in fact, I could even go to the extent that I never even thought that I would be among the top two candidates. Just third, fourth, third, fourth, always around that area but happy with that because my main thing is sports. I used to play a bunch of sports and I would...
[00:03:58.25] Karthik: Which one are your favorites?
[00:04:03.08] Prashant: Of course growing up cricket, but then I picked up on basketball later on. So, I've realized that anything which is eye-hand coordination, I'm decent at but eye-leg coordination, I suck. So I have this very clear understanding that I do not understand D of dance, football, or none of the sports where you require eye-leg coordination, I suck at it. But anyway, so yeah, over a cricket match, I think I overheard someone say that "IIT to bhul jao, hota nahi hai" to someone else, not even to me.
[00:04:30.24] Karthik: Okay.
[00:04:29.02] Prashant: Okay, what is that thing?
[00:04:33.13] Karthik: This is what, ninth grade?
[00:04:32.13] Prashant: No, this was 11th grade. I had no clue, honestly speaking, I had no clue of IIT until then. Then I actually, without even saying anything to anybody, I just soaked up that information and I went to the nearest stationary shop and I got a magazine to read about it. So that was my first twist with it. I read about it in a magazine and I learned a few things and then I thought, okay, yeah, maybe I could do this. Maybe I should try it.
[00:05:02.23] Karthik: You were a science student and
[00:05:02.03] Prashant: I was a science student. So that's that. After,
[00:05:08.07] Karthik: And then of all places is, Chennai? How do you land at IIT Madras?
[00:05:10.26] Prashant: So that was also by design. Grew up in Delhi. There are ages when people go through this rebellious nature, where you want to be as far away as you can be from the family. I chose IIT Madras, like no extended family of mine would ever be able to come and visit me. I had some family in Bombay. I had some family in Kanpur, which is close by. So, I chose Chennai purposefully. I just wanted to be free, and not have any relatives.
[00:05:42.08] Karthik: It's a 17-, 18-year-old mindset.
[00:05:41.00] Prashant: Yes. In the hindsight, it worked out. But yeah, that was the only logical reason behind it.
[00:05:48.27] Karthik: That's fine. And then what did those years teach you? Did it tell you that you wanted to be an entrepreneur or you felt there are many cool jobs out there?
[00:05:54.16] Prashant: IIT Madras at that time, I don't know if it's true right or not, had this very peculiar culture where everybody wanted to Ab, I don't if you know what that word Ab means.
[00:06:04.19] Karthik: Get out of the country, go abroad.
[00:06:05.20] Prashant: Which is basically write the GRE and do the MS and...
[00:06:07.29] Karthik: I'm a little older than you, so it was definitely even more prevalent then. Cause the opportunity set was even lower.
[00:06:13.07] Prashant: Correct. Almost 90% of Janta would want to Ab, would want to just go abroad and do their MS and then Ph.D. and then probably get settled. Of all the people, I was actually the big opponent of it. In fact, an opponent of even leaving India. And look what I did, I'm going to talk about it later. For all my four years, I was like, we should be in India. We should build India together. We should do something about it. And then Capital One came on the first day and I was literally not planning to even sit for the interview process, but my friends said, Hey, what are the odds anyways? Everybody is going to apply and they are only going to take one or two, so you might as well apply to see where you are.
[00:06:52.22] Karthik: Yeah. You got the job.
[00:06:52.12] Prashant: I got the job.
[00:06:55.16] Karthik: So, you went Virginia?
[00:06:57.04] Prashant: I went to Virginia.
[00:06:56.22] Karthik: Wow.
[00:06:58.27] Prashant: Right up to the campus, I went to Richmond, Virginia. And literally, I think my non-caring attitude got me that job.
[00:07:07.28] Karthik: That's right. Because you had nothing to lose.
[00:07:06.01] Prashant: I had nothing to lose.
[00:07:07.18] Karthik: You had nothing to look forward to. You were like...
[00:07:11.26] Prashant: They took 20-plus interviews and I couldn't care less in each.
[00:07:13.12] Karthik: One of the most intensive interviewers in early 2000.
[00:07:18.17] Prashant: Yes. It was like a very hotly contented job.
[00:07:21.22] Karthik: Correct.
[00:07:22.06] Prashant: And for me, if I were in pressure to crack that interview, I think I wouldn't be able to do it. For me, it was just a completely non-caring attitude. I'm just having a good time. In fact, I even remember what got me that job. So there was this one particular interview, I don't remember the entire process, but in one particular interview, they presented a case study and asked us to solve it. And my observation to that case study was that this entire case study is wrong for some reasons, which I don't remember now, but they're like, what? We have been using it for the last 10 years. And I'm like, for these reasons, it is wrong. I will not answer this. This is wrong. And then, we were sitting in the Glass cubicles. So, he took that paper, he went out, he spoke to 5-6 people, and then he came back in and all he did was thumbs up. That's it.
[00:08:07.22] Karthik: Oh.
[00:08:06.21] Prashant: All he did was just thumbs up. Yeah, I thought that, okay, fine.
[00:08:17.27] Karthik: Standing out makes a big difference and challenging the status quo makes a difference. It was early in your blood, in that sense. So by the way, did you pick up any, Tamil, [00:08:22.01] _____?
[00:08:21.18] Prashant: rendu, moonu, naalu, kunjam, kunjam.
[00:08:22.26] Karthik: Okay, so I grew up in Chennai, though I'm Reddy born across the border in Andhra and I did the same thing. I ran away to Roorkee.
[00:08:36.01] Prashant: Ah, on the other side.
[00:08:37.02] Karthik: Yeah, the other side, further away from Delhi, I did the 5 hours on a bus.
[00:08:38.21] Prashant: Yeah, man, it has to be a place where your relatives, your cousins, nobody can come and figure out what you're doing.
[00:08:46.26] Karthik: Yeah. It allows you to grow into a different part of yourself. And I think keep saying it was my first exposure to people from UP, Bihar, Rajasthan, and Delhi.
[00:08:55.09] Prashant: That was your first exposure ever.
[00:08:56.06] Karthik: I haven't crossed _____ before that.
[00:08:56.12] Prashant: Wow.
[00:08:59.14] Karthik: So this was 17, taking 36 hours train to Delhi, and then a 5-hour bus.
[00:09:06.09] Prashant: Those train rides.
[00:09:03.24] Karthik: Teach you a lot, but that's why you seem to love travel. So, we'll come to that very quickly now.
You went to the US, so why did you come back? I know the mindset you just expressed that there was a love for India, but when you were in the US, there's land of milk and honey. So, it's a fantastic place for people who are determined to make a life for themselves. I spent seven years there and you can't deny that. It's a phenomenal economy.
[00:09:30.13] Prashant: Absolutely.
[00:09:29.28] Karthik: What brought you back?
[00:09:31.22] Prashant: Of course, there is nothing wrong about the US, but I decided to come back because it was the calling, after your H1B can only be renewed twice. So, most people, as soon as they get their job, they apply for the green card. I decided not to in the first year itself. It was five or six of us who all went from IIT and IIM and I decided not to apply for my green card just because I was like very clear that this is just, time in the blip right now for me. And, eventually, I'd have to move back to India. And then, yeah, my two younger brothers, brilliant younger brothers, they found... I'll tell you about EaseMyTrip was born.
[00:10:07.07] Karthik: Yeah, please. That's I'd love to hear. How does it all connect back to now the beginnings of EaseMyTrip?
[00:10:10.14] Prashant: I don't if you would remember that there was this offer, which Air Deccan used to run, One Rupee a ticket. They would run one Rupee a Ticket.
[00:10:18.04] Karthik: That was their offer price.
[00:10:18.10] Prashant: That was their offer price. It's a lucky draw and you might be the lucky one to get that one Rupee a ticket. So, my two younger brothers, they found a hack to get that One Rupee Ticket every time.
[00:10:25.00] Karthik: Okay.
[00:10:28.16] Prashant: Yeah. And, that miffed Captain Gopinath for some time. We are the ones who are getting that one ticket every time and eventually, I think we got an offer from them saying that, Hey, why don't you guys manage our North India distributorship?
[00:10:40.12] Karthik: Oh really.
[00:10:41.20] Prashant: Yes.
[00:10:42.23] Karthik: Oh Interesting.
[00:10:44.03] Prashant: That's exactly how we actually started Duke Travel Agency, not even EaseMyTrip.
[00:10:46.27] Karthik: I was going to come to the name. It was called Duke Travel Agency.
[00:10:48.23] Prashant: Duke Travel Agency and right now I get this question asked a lot that, why did you choose travel? There were already six big companies who had raised tons of money. Why did you decide to enter the space? It wasn't us to decide. It wasn't very well-thought-out plan. It was like this happened. One Rupee ticket, we hacked. We found a way, Duke Travel Agency happened. Then while running Duke Travel Agency, we realized that there are a lot of pain points which travel agents undergo through and could be solved using technology. That's how the first version of EaseMyTrip happened, and then three years later, we decided to become a B2C company. And this is what we are now. 95% of our business is consumer.
[00:11:28.22] Karthik: So the brothers were hackers or like Coders or
[00:11:32.28] Prashant: Mix.
[00:11:33.05] Karthik: You joined when Duke was born or when EaseMyTrip was born?
[00:11:34.01] Karthik: When EaseMyTrip was born. So, I joined about a few years later and EaseMyTrip, the first version, which was the B2B travel agency was running.
[00:11:44.29] Karthik: That's what I understood as the origins of EaseMyTrip, you were solving for the
[00:11:47.22] Prashant: Travel agent.
[00:11:50.04] Karthik: Yeah. Various distributors in the ecosystem. And how did that go or why did you think that was a good idea back then and why did you then move to EaseMyTrip?
[00:11:56.02] Prashant: The idea was actually very simple. Since we were ourselves travel agent, we knew exactly what pains we were going through. The pain was very simple, that there are about 10 odd airlines at that time, and airlines demanded travel agents to put in some money in their account to be able to use them. And then in return, they'll give 3%-4% commission. Then, there's a huge CapEx, which gets blocked. You're putting 50,000 rupees in each airline. Then, your Rs 5 Lac CapX down, and then, you get a 3%-4% commission. And most of the travel agents, they're like the hand-to-mouth guy.
[00:12:29.00] Karthik: That's true. It's like a small lifestyle business. It's a family business.
[00:12:29.01] Prashant: It's a very small lifestyle business. Rs 5 Lac of CapEx is actually a huge amount.
[00:12:35.27] Karthik: It's a big number.
[00:12:36.23] Prashant: It's a big number. I'm talking about back in 2006-2007.
[00:12:38.23] Karthik: If somebody is working with a computer at home.
[00:12:39.18] Prashant: Absolutely. So the first offering of EaseMyTrip was that hey, we have connected all airline APIs. All you have to do is put 20,000 in EaseMyTrip and you will be able to book any airline ticket and we will give you slightly better commissions than what you are getting from the airlines directly because we are an aggregating bunch of. That was a simple offering in the hope that we will be able to aggregate a bunch, and hence in the hope, we might approach the airlines and say, give us slightly more.
[00:13:05.14] Karthik: So you hit all the nails on the head. India, a value-conscious economy, small entrepreneurs trying to build, and tough market conditions, and you're solving for all those pain points.
Going back to the miraculous story of how do you bootstrap into becoming a billion-dollar listed company, what did it entail in terms of capital risk? What did the family think of this? And did you have to actually ever raise money, at least from family and friends or was this something that you figured out from your commission structure that you continue risking and then build and bootstrap from there?
[00:13:35.18] Prashant: So if you look at the history of EaseMyTrip, from the year 2008 till 2013, it's a public record now, the only money which we put in the first five forming years were about Rs 15 Lac. So, it's not that we had a bunch of money.
[00:13:51.15] Karthik: That was the startup economy back then. You didn't have, hundreds of VCs floating around.
[00:13:55.12] Prashant: But even then, our competitors had raised tons of money. [00:13:57.11] Karthik: That's true. That's true. Because everyone believed that this model works in the rest of the world, so we should do better in it in India. And that's the kind of stuff that VCs tend to chase first. Amazing!
[00:14:04.25] Prashant: Rs. 15 Lacks is the amount which we put in. Only after the year 2013, we borrowed some money and we put more during the hyper growth part.
[00:14:14.02] Karthik: Got it.
[00:14:16.00] Prashant: But otherwise, the company was completely built on extremely solid efficiency.
[00:14:18.14] Karthik: Got it.
[00:14:23.05] Prashant: Now, during the first three years, we were not competing with any of the...
[00:14:22.16] Karthik: You're not playing the B2C game.
[00:14:25.01] Prashant: Yeah. We were not playing the B2C game. So that gave us the breather where we build our own technology during that time. We basically build relationship with the airline. We build the operation, the technology, everything during those three years.
[00:14:37.21] Karthik: How big would it have been back then before you launched B2C?
[00:14:42.20] Prashant: This primarily happened out of our home, so
[00:14:44.16] Karthik: Oh, you're still at home then?
[00:14:46.10] Prashant: Yeah. We dedicated one room, and in that room, we had about 10 odd people sitting and the first three years of EaseMyTrip were at our home. [00:14:55.22] Karthik: Moved from the garage to the bedroom, but it was still a home startup for you.
[00:14:59.20] Prashant: It was a home startup.
[00:15:01.02] Karthik: So amazing. So, 10 people building this for three years.
[00:15:01.28] Prashant: 10-12, I can't recollect the exact.
[00:15:02.25] Karthik: Yeah that's fine, mota mota.
[00:15:05.16] Prashant: Mota mota.
[00:15:08.00] Karthik: Or bapuji ne kaya bola, whole trader.
[00:15:10.11] Prashant: Honestly, all three of us never really cared about his business.
[00:15:15.05] Karthik: It was sustenance.
[00:15:15.00] Prashant: It was paying the bills that is what it was doing. And I don't think so he was also very inclined for any one of us get.
[00:15:22.19] Karthik: To get in there.
[00:15:23.07] Prashant: To get in there. He knew that there are better, bigger things for his kids to do or be a coal trader. With all the humbleness, I could say that, this is what he also wanted.
[00:15:29.13] Karthik: No, absolutely. We've all gone through that with our parents.
[00:15:33.05] Prashant: Yeah. Three years of running B2B and then.
[00:15:35.05] Karthik: What gives you the courage to think that B2C is a game you can play and
[00:15:41.18] Prashant: It's just foolishness, literally just foolishness. Because when you look back...
[00:15:46.18] Karthik: Very important entrepreneurial trait.
[00:15:50.18] Prashant: Yes, it's extremely foolish. Because we had a clear dictate from our agents that if you turn B2C, we are going to stop using you.
[00:15:55.18] Karthik: Oh, is it?
[00:15:59.01] Prashant: We had a clear dictate from them because then it's conflicting, right? We have their customer's data and we become B2C. So, in those three years, somehow we got the wheel rotating and the business started growing B2B side and then to say that we are going to halt all of it and restart again without the monies was actually nothing else but foolish. But we did that, nevertheless, probably for one solid reason, which means that we could see it coming. Even though our business was growing, we knew that B2B will never be forever. Consumers will eventually want to buy directly, at least the flight part. So that vision or wisdom was very clear and it was clear enough to make us a decision, which was extremely hard at that time. Our business volume fell by 50%-60%, as the moment we took the decision that we are going to move.
[00:16:43.08] Karthik: Matlab agents bhag gaye.
[00:16:44.28] Prashant: Yeah. Agents stopped working. Agents are like, now we cannot trust you with the data because you might actually use my data and
[00:16:49.21] Karthik: But slide fast forward, they came back. They all trust.
[00:16:50.12] Prashant: No.
[00:16:54.20] Karthik: They didn't?
[00:16:55.06] Prashant: Of course, there are just still an agency business, which we run, but it's only 3%-4% of our overall business. So, it's just that, some went, some came back, but it never became too big of a business because anyways, air ticketing for travel agencies had been dying over a period of time.
[00:17:08.27] Karthik: Correct.
[00:17:10.10] Prashant: So it's not a big business anyways. It's just dying. So, that's the nature of why it continued to shrink over the period of time. Not because they did not trust us back. It's just that it wasn't a big business anyways.
[00:17:20.09] Karthik: Got it. So, the foolishness led to the B2C experiment. How you build a business of that nature profitably?
[00:17:24.23] Prashant: Foolishness led us to say that we will try it.
[00:17:29.21] Karthik: Correct. You tried it.
[00:17:32.24] Prashant: We should try it. The idea was at that time, everybody, all our competitors, was charging this extra amount, which was called as convenience fees. Now, see from our perspective, let's say if we are getting 6% commissions from the airline, we are passing back 5%-5.5% to the travel agent. So, we are sustaining ourselves only on half a percent. So, we have learned how to live only in half a percent.
[00:17:54.03] Karthik: The DNA of the firm has already built that.
[00:17:58.27] Prashant: Yes. We learned to live only on half a percent margin.
[00:18:00.06] Karthik: Amazing.
[00:18:02.05] Prashant: Now, a B2C transaction, see from our eyes, what's the need of charging anything extra? You're getting 6%. Even if you give 1.5% discount to customers and you pay 1.5% as MDR, which is payment gateway charges, then also you end up doing 3% profit from 0.5% to 3%. It's almost six times on our P&L.
[00:18:25.02] Karthik: So just for clarity of our listeners today, if you don't charge the convenience fee, it's not like the airline charges you. So the airline charges on their side, you charge on your side.
[00:18:33.19] Prashant: That's correct!
[00:18:33.06] Karthik: This was something that the airline wasn't going to impose on you, so your costs were only what you pass back to the customer as a reward and the MDR?
[00:18:38.01] Prashant: Absolutely.
[00:18:38.15] Karthik: Okay. Sorry. Coming back to,
[00:18:41.09] Prashant: So convenience fees basically for the listeners as well, convenience fees comes at the very last line. So, on the front side you will see same price for everybody.
[00:18:47.28] Karthik: That's Right.
[00:18:48.20] Prashant: And then everybody has...
[00:18:49.22] Karthik: Right. When you are checking out, they'll throw this.
[00:18:51.25] Prashant: It's also a multiplier of a passenger.
[00:18:54.11] Karthik: Yes. Correct. If you have 2-3 people, you have 2-3 convenience charges.
[00:18:56.18] Prashant: Correct. It's a multiplier of passenger. So for us, it was a no-brainer that we should not charge convenience fees. Our profitability for each transaction coming on the B2C side was almost six times.
[00:19:08.12] Karthik: Correct. From half a percent to 3%.
[00:19:11.04] Prashant: From half a percent to 3% because we were built for half a percent.
[00:19:14.27] Karthik: That's right.
[00:19:13.25] Prashant: We never thought that we should charge convenience fees and we have kept the same policy all throughout, even until today we allow customers to not to pay convenience fees at EaseMyTrip.
[00:19:23.00] Karthik: You told me this. The first time we ever met that was my "aha moment". And clearly, I wasn't your customer. I still probably not. I go to airline insights and book, but it's such a fascinating thing. Small insight, but you're showing the right value proposition to a value-conscious customer.
[00:19:36.18] Prashant: See, I get this question asked a lot, that Prashant if you are definitely cheaper than your competitors and in such price conscious country like India, why are you not already number one? Why are you number two? If you are literally cheaper every time. The simple answer for that is that there's a delayed gratification in our case. When you see on the first page, the prices of EaseMyTrip are the same as everybody else. Only if your friend told you to stick around with EaseMyTrip and follow the 10 procedures.
[00:20:05.14] Karthik: Correct.
[00:20:05.20] Prashant: Then, you'll see the benefit coming. That's where, people falter at this matter. They do not give us that much amount of time and space. They did not in the past.
[00:20:11.29] Karthik: Yeah. Now of course it's changed.
[00:20:14.11] Prashant: Now it's changed.
[00:20:15.25] Karthik: No, great story. And then when did the take-off moment happen? So obviously this was your consumer insight. You got into...
[00:20:19.28] Prashant: Actually, this was not even a consumer insight. Insight happened in year 2014, somewhere 2015. This was mostly just the need of the hour, which is that we, who are not pushing any marketing budget, cannot afford to charge convenience fees.
[00:20:32.16] Karthik: Fair.
[00:20:31.11] Prashant: That was the need of the hour.
[00:20:35.29] Karthik: Understood.
[00:20:36.04] Prashant: Now, the business grew at a very modest pace. From the year 2011 to 2014-2015, we did not see us as grow leaps and bounds. And those were the testing years because the growth is also in the range of 10% to 15% per annum and the business is not growing so much and we are just barely breaking even. And that is when we started doubling down on it.
I was sitting in a call center one time and there was this old lady who was calling to get a refund or something. So, I do whatever she's asking me to, but then I checked her history and she has made tons of bookings from EaseMyTrip in the last few months. And then I get curious and I asked her, ma'am, why have you not been using EaseMyTrip in the past? For the last two months, if you're using it so much, it's not that you're just traveling now, you must be traveling before as well. She gave me this insight of what we were doing and why this became a big deal. Prashant, every time I would use some other website, the prize which I see in the final prizes, changes and I would always think that the airlines are the guys who are actually doing this malicious work, which is when you are hooked in, they increase the price. So, all my life, I assume that all my last few years of buying air tickets, I assume that this maliciousness came from the airlines. And suddenly, quietly, some additional charge came in at the last minute because I am hooked in. I've already put in my name, email address, number, and everything. But then the last transaction, I had with somebody, I realized it wasn't the airlines and I felt and that's how I search for any other company who does not add that additional charge. That was the insight that people do not want to feel cheated, whether it is for one rupee or one Crore.
[00:22:11.19] Karthik: Correct. It's always there.
[00:22:12.24] Prashant: The feeling of being cheated, is a very terrible feeling that somebody outsmarted you. You do not want that feeling to be there and we built EaseMyTrip in such passion.
There are multiple other things which we did to build upon this narrative, which was that, you would experience this quite often. That actually even before the convenience fees, the flight fair changes. We have tried to reduce that as much as possible in EaseMyTrip and I tell you how we were able to do.
There is this something called as book-to-look ratio, which we have to maintain, which is that if there are a hundred people who are visiting, who are searching for the price, at least two or three should convert because otherwise you are hitting unnecessary on the airline's APIs. So airlines dictate you to maintain a decent look-to-book ratio. Now, in order to do that, most of the companies do a lot of caching work, which is that they do not fetch the price on the front page and then basically, when you go to the next page when your intent is more clear, then they go and fetch.
[00:23:08.14] Karthik: Then they go and fetch.
[00:23:09.00] Prashant: So hence the price changes.
[00:23:09.05] Karthik: Correct. Because it's dated info.
[00:23:12.14] Prashant: Exactly. It's dated info.
[00:23:14.17] So at EaseMyTrip, we used a very different kind of caching for which we are even applying for a patent and because of which we have been able to do this extremely successfully. We in fact track it that how many times we are not honoring the fair and many a times if the fair difference is less than a hundred rupees, we don't even take it.
[00:23:32.25] Karthik: You'll just absorb it.
[00:23:33.07] Prashant: We absorb it. We just absorb it.
[00:23:34.25] Karthik: You just create customer delight.
[00:23:35.04] Prashant: Correct.
[00:23:35.08] Prashant: So we understood this pain in a deeper manner and we have worked very proactively on it. In fact, the other thing which we do, which might sound counterintuitive to you, is that we track how long does it take for a person to book an air ticket very actively and we reduce it. We do not want people to spend.
[00:23:53.12] Karthik: Yeah. It should be super fast.
[00:23:54.14] Prashant: We want people to spend the least amount of time.
[00:23:56.25] Karthik: If you can get to an Amazon one click at some point, it'll be
[00:23:59.07] Prashant: Correct.
[00:24:00.17] Karthik: Absolute delight.
[00:24:01.17] Prashant: So, it's a part of our DRHP. About 3 years ago, our average booking time was 5 minutes and 37 seconds.
[00:24:08.17] Karthik: Okay.
[00:24:09.02] Prashant: And right now we are trailing at 3 minutes and 48 seconds.
[00:24:11.20] Karthik: That's amazing.
[00:24:11.22] Prashant: So, we have reduced it by two minutes. So there are lots of hoops which people put you through so that they can take the auxiliary revenues. We don't. We do not make people go through those hoops.
[00:24:23.21] Karthik: Amazing insights. We can go on and on. Travel is fascinating. It affects us every day and hoping a lot of people go and check out EaseMyTrip after this. Obviously, you have done a wonderful job building all of these. You're going through this, we'll cut over very quickly to 2015 to IPO and then the pandemic. The last question on that prior journey, theoretically, if you had met me and I said, I'll give you a crore or two, at that juncture, we didn't know each other.
[00:24:47.06] Prashant: Which year are we talking about?
[00:24:47.28] Karthik: 11 to 14. In that era where you were bootstrapping, did you get approached? Did you pitch people? Would you have taken the money if I gave it to you?
[00:24:55.20] Prashant: I did approach people in the year 2009 or 2010 when I moved back to India. That's the first thing I did.
[00:25:01.22] Karthik: Okay.
[00:25:02.04] Prashant: I actually came to Bangalore.
[00:25:03.22] Karthik: How come no one gave you money? Usually, individuals do, angels do.
[00:25:07.08] Prashant: We didn't approach the angels.
[00:25:10.01] Karthik: Ok. You just went to institutions.
[00:25:10.14] Prashant: We just went to the institutions. The business was doing okay. So we just went to the institutions, and institutions were right in not giving us the money. There's nothing wrong. We exist purely because of our hustle.
[00:25:20.01] Karthik: Yeah. Because you're saying in looking back that B2B business pitch was not as compelling you.
[00:25:23.25] Prashant: It wasn't. They were right. And our pitch was also that we may not do this B2B forever and then the thought process was, then you'll be too late. You already are late. Five guys are out there and everybody has picked their bet. So then you'd be too late. So that made it even wrong that if you were just talking about B2B.
[00:25:39.16] Karthik: Ab kyon karun.
[00:25:40.01] Prashant: Haan. So anyway, I met 3-4 guys and then I actually started
[00:25:46.21] Karthik: Did you get any great feedback?
[00:25:48.17] Prashant: Like I could tell that this is a no in the first conversation, I could tell it's a very clear no.
[00:25:53.11] Karthik: Any learnings from that experience that served you better or it was?
[00:25:55.18] Prashant: It did. The experience served me better. It definitely made us think more B2C. It definitely pushed more in the B2C side. But I remember doing this and I met 3-4 guys and then I started meeting travel agents. I might as well do some business since I'm aware.
[00:26:11.05] Karthik: No, you seem good at optimizing that. It's fantastic as an entrepreneur. Then what started taking off from 15 that led to this confidence that you can continue bootstrapping and get to a scale where you eventually decided to list?
[00:26:22.25] Prashant: I will talk about year 2013, 2014, I think that's when EaseMyTrip was in, it wasn't in a great growth period, but we definitely needed more hands at that time. So it was just like three of us and then we have call center people, and then we have tech people. This is what it is.
[00:26:35.22] Karthik: Correct.
[00:26:35.23] Prashant: All the sales, all the marketing, all the HR, all the accounting, everything is done by us, hands-on. So that is when we felt pressed and we felt like we needed more people like product managers, quality analysts, marketers, that was the need which we felt, but we couldn't afford people from outside because most of them were causing anywhere between Rs 1 Lac to Rs 2 Lac a month. And we couldn't even afford thinking of those salaries. We are living on a razor thin margin.
This is what we did. We actually picked up the best call center guys and we trained them ourselves, and we made them as product managers. We made them as quality analysts. We made them as marketers in the company. These people are literally the backbone of the company. Almost everybody whom we graduated is still there, and we continue to follow this policy of graduating people from call center to other departments which are not even relevant to what they have studied or anything.
[00:27:33.21] Karthik: That's fascinating! In fact, it was one of my questions, in a company of this nature where you don't have the capital to get these kinds of ready-made hires, how we build culture, how we build an entrepreneurial nature of thinking about the company because a bootstrap company has to be that way, top to bottom in its thought process.
[00:27:49.13] Prashant: I would even say it has to be bottom to top. That's exactly the point.
[00:27:54.19] Karthik: Otherwise, it'll fail. If somebody comes with an attitude that I'm coming for a salary or I'm going to benchmark you versus another company and you've lost half the battle already. So, what have you got right on that front? Any things that you can give, young entrepreneurs a lesson on, in terms of how to manage when you're building this frugally? What cues?
[00:28:12.13] Prashant: As I said that not everything can be done by yourself. We were surely feeling very short of people at that time. And that is when we started trusting upon our people, and we realized that in the hindsight, that was one of the best decisions we have ever taken. You can easily bring people from outside, but then the people who have grown along with you, if you give them the pedestal and if you honor what they have done for you so far, by giving them even a higher role, entrusting upon them to deliver, they go length and breadth to give you value back. In a way, we have created a kind of relationship with them, which is unparalleled. We go to their weddings. We even do their children's naamkaran for that matter. It's those 50-60 odd people in the company who are almost emulating founders in every department.
[00:28:57.21] Karthik: I've seen one or two examples of this, but it is a fascinating example of how that can be built.
[00:29:03.03] Prashant: Their loyalties are unshakeable. That's how I would think.
[00:29:04.00] Karthik: This was when you were not able to dangle the promise of "ismain wealth creation ka path kaya hai" IPO nai hoga.
[00:29:11.01] Prashant: There's nothing about money over here. Of course, we incremented their salaries.
[00:29:13.22] Karthik: Of course.
[00:29:15.25] Prashant: Yeah. It is just that we were honoring with the position which should be trusted upon. So, it was just the honor of giving.
[00:29:21.14] Karthik: Respect and carry progression of a certain nature when done thoughtfully is like a very long...
[00:29:28.13] Prashant: Planning, mastery and giving people a sense of ownership.
[00:29:32.23] Karthik: Phenomenon long-term thinking.
[00:29:34.10] Prashant: I would beg to differ on long-term thinking. We were just doing whatever is required.
[00:29:40.14] Karthik: Fair, it's a good point. Now, when you look back, it feels like this is what made it work.
[00:29:45.08] Prashant: Correct. But that time we were just doing whatever was need of the hour.
[00:29:51.00] Karthik: Thanks for keeping it real and humble as always, Prashant. No, I love you for that. Growth trajectory, I'm guessing changed, which gave you the idea that, a public company banayenge.
[00:29:57.11] Prashant: Nahin.
[00:29:57.26] Karthik: Fir.
[00:29:58.01] Prashant: Public company to door door tak kahin nahi.
[00:30:00.17] Karthik: Main kah raha tha 2017-2018 tak pahunch gaya hoga.
[00:30:04.14] Prashant: 2018 onwards, the pubic thought process came. But till 2018, there was no thought process.
[00:30:07.25] Karthik: Ab is size pae apne funding kyon nahi uthaya.
[00:30:10.16] Prashant: Yes. To answer your question, actually, 2016, 2017, 2018, we did get some offers because we were growing profitably.
[00:30:18.20]Karthik: Decent size.
[00:30:22.00] Prashant: We were a decent size. So, we did get some offers, but we were also growing at 75% per annum, profitably.
[00:30:24.29] Karthik: And you know how you build profitably.
[00:30:27.15] Prashant: We were doing it profitably. So we were growing and we were growing profitably. Every time the offer came with a rider, which was that you'll have to use this money to grow even faster and then we understood by then that this game is not about. It's an OTA. Many people forget, in this industry, they focus on "O" part, which is online and forget the TA part, which is basically a travel agency.
[00:30:49.04] Karthik: You are a travel agent.
[00:30:50.15] Prashant: You are a travel agent.
[00:30:49.18] Karthik: Correct.
[00:30:53.06] Prashant: Among all the six OTAs in India, we are the only ones who run our own call center. Everybody's outsourced. So, this is one of the big reasons why people love EaseMyTrip because we care. We think this is the core of the business and core must be managed by yourself. And, I talk about convenience fees a lot, but honesty speaking, it's probably only 20%-30% of the reason why we have become what we have become. Half of the reasons I can easily attribute that we actually care. We want to deliver people their refunds back, their issues back as soon as possible and that is why we run our own call center. And I hear this a lot that EaseMyTrip is not pixel-perfect, and I think it's almost also by design. We don't want to put too much of energy in getting the "O" right. We want to get the "TA" part. The people only need two things from travel agency. One is a great service, and second at a great price.
[00:31:44.20] Karthik: Correct.
[00:31:44.26] Prashant: There's no third thing which is required.
[00:31:49.13] Karthik: It's a utility at the end of the day.
[00:31:49.09] Prashant: It's a utility.
[00:31:50.21] Karthik: I need to get from point A to point B just make my life easy.
[00:31:51.29] Prashant: Correct, it's a utility. It's a utility, it's almost a commodity. And if you treat that business in that fashion and ensure that people get well, I will not be a hundred percent the time cheaper because my competitors can choose to give a lot of discount at any given point of time and be cheaper than me. But I must ensure that over a long period of time, I come out cheaper at least 70%-80% of the time.
[00:32:16.02] Karthik: That's all you can do. You can play those games beyond a point.
[00:32:20.09] Prashant: In fact, we do things which are quite counterintuitive many a times. For example, if one of my competitors goes on the burning game and increases the discount from 2.5% to 4.5% or 5%, we actually reduce our discount during those times. Instead of matching it up, we reduce our discounts. We know that there are two sets of people, one who have become very habitual of EaseMyTrip and one who are deal hunters. Deal hunters are going to move even for Rs 10.
[00:32:40.23] Karthik: That's right.
[00:32:43.14] Prashant: But the ones who trust EaseMyTrip, who value over experience, they do not care about this money. So, we would rather let go of that 20% traffic.
[00:32:50.16] Karthik: Understood
[00:32:51.17] Prashant: Be profitable for the remaining 80%.
[00:32:54.12] Karthik: I think all hallmarks of this actually is a good segue into the question I didn't answer. So, we were thinking about, a lot of the fund one companies that remind us of you.
[00:33:02.17] Prashant: Oh, really?
[00:33:03.18] Karthik: In the sense that, if they were not hot enough or sexy enough or their models were not considered theoretically sustainable or large, they were just passed over. So, theek hai, humne paise de diya use but Unicorn thode bane. So, they were passed over and you have two choices and you say, I roll over and act dead or I basically figured out life without venture money and a lot of them started doing the latter thing. And so suddenly in the last two years, we've had a resurgence of fund one company, all 11 to 14 vintage.
[00:33:31.12] Prashant: Wow, 11 to 14 vintage.
[00:33:33.26] Karthik: That is why we build one. Exotel, [00:33:35.01] _____, Carbon Clean solutions. You name them, Purple.
[00:33:40.26] Prashant: _____ recently.
[00:33:41.17] Karthik: All these companies, are they funded
[00:33:45.06] Prashant: Back then?
[00:33:44.18] Karthik: Back then. And then we said, can't be the only our founders are doing this and that's why you are here with us today. And then we started thinking about why aren't these stories better told on this path that you were talking about, just throw money at the problem, buy the growth, accelerate the "O" of the online businesses, and then somehow find yourself at a theoretical billion dollar evaluation. As theoretical because it is in the domain of private funders to claim that it is a billion dollars. Can you subject it to public scrutiny? Arguably not as the harsh market today showing you and today, the companies that have built the hard way are essential, in our view, the equivalent of X comes from the idea, it is borrowed from X-men, X-women equal.
[00:34:26.18] Karthik: So you look like a freak. Sorry to use the word, but it's a reality. That's what people think of the X-man movie franchise. So ordinary humans think of them as freaks. They say, this guy should be controlled. He has these powers that are not suitable for normal people to hang around with, and you see the superpower that can be used for if it is harnessed well, and I think our intent was to champion that. And it became a narrative in our heads. If we wanted to celebrate our fund one resurgence. It became, as you saw, a t-shirt, which became our slogan for this year's Blume day and then we said that's all fine, but we should go back to the stories that were written by these entrepreneurs and highlight them.
[00:35:06.23] Prashant: That's how X-Unicorn podcast.
[00:35:07.29] Karthik: That's how the podcast came in this. It was inspirational enough, I think, to become the first podcast series ever that Blume has produced. And once again, thanks for being a part of that story.
[00:35:16.17] Prashant: Amazing.
[00:35:17.07] Karthik: Maybe cut back to that point. We also wanted to challenge this fundamental definition of a unicorn. I know you call yourself that, but if you go by the strict definition that Aileen Lee put out in 2013, the term was first coined, it was a venture-backed company less than 10 years old, which was in the private domain, and it reached a billion dollars. It was actually all of this.
[00:35:41.01] Prashant: Okay. There's a combination of things.
[00:35:44.10] Karthik: When you actually go and look at our 100 plus Unicorns, over 20, 30, 40 of them will fail the test. As one of these qualifiers. It doesn't matter. That's the whole point.
The point of this podcast doesn't matter. It doesn't matter. So all this is jargon. What is that journey? What is that story? And if you want to celebrate entrepreneurship, which is why we should exist at one level as much as we were VC and PE. Fundamentally what you're backing and you say founder first, and you say, founders are great and we want to back those journeys and if you're doing venture, you're doing it from the get go. You're not cutting the journey after Prashant has become a public company. That's, fidelity and some big boys. So, we want to be able to say that there are other inspirations, not the guy who pays a fresher 25 Lac, but the guy who built the company with 15, Prashant Pitti, and his brothers, of course, giving credit to your whole family who built this business. So, I think it's a narrative we very strongly feel it and we are doing what we love as a brand and this is the Blume brand for you. By the way, our journey, the reason I think we are very emotional about this is the Blume journey is very similar too.
[00:36:45.24] Prashant: Oh, is it?
[00:36:46.07] Karthik: It's a hundred crore fund which looks like nothing today. That's how we started. We cut one crore cheques at an average of 8-10 crore valuations, 60-70 times in four years and those journeys are what are mushrooming.
[00:36:58.02] Prashant: And those people must have put faith in you over and over.
[00:37:01.03] Karthik: Yeah. And so we've grown and it's come at the back of these start entrepreneurs because if without their track record.
[00:37:06.28] Prashant: No, but it's you also refined them.
[00:37:08.15] Karthik: Yeah. We are celebrating all of that little bit today.
Now, at what point do you think, why did you think you needed to go public? Was it as an end state for all the people who went with you on the journey or it was just a natural point where you said, look, I'm going to run this business forever? I want that mindset, for listeners. When does the entrepreneur think, should I sell this business? Should I build this preposterity? Is it getting boring? Should I do other things or should I just put professional management and run the business? The business is a business, it'll run without me or with me.
[00:37:36.27] Prashant: And honestly speaking, a business should get to that day where the founder should graduate.
[00:37:40.12] Karthik: Absolutely.
[00:37:41.22] Prashant: There needs to be a time, and it's actually very hard for founders as well to delegate and let go.
[00:37:45.10] Karthik: Yes.
[00:37:47.18] Prashant: To let professionals run it. Every journey is a different journey. Zero to one is different, 1 to 10 is different. 10 to 100 is different, and 100 to 1000 is a whole another game. For example, we have hired some professional CXOs. And for the first time, we were one of the main sponsors for the Asia Cup. That kind of money, I wouldn't be able to spend myself as an entrepreneur. I come from a very frugal mindset. We build a company on almost a scraping program.
[00:38:07.25] Karthik: Yeah.
[00:38:09.20] Prashant: You wouldn't be able to take these calls by yourself. Because I still am living in those eras, those times.
[00:38:15.23] Karthik: Yeah. Your head doesn't change that.
[00:38:17.10] Prashant: It doesn't change that fast, that frequently, even though the numbers are growing. We have turned 100 Crore profits, it still does not change the frugality or the nature. Efficiency and frugality is almost equivalent to the culture according to me and it's extremely hard to change over a period of time. I am glad that we have hired some professionals and they are helping us steer through the new challenges which we are facing at this moment and grow along with it. But I think, whether to sell your company, whether to hand it over to professionals, whether to do an IPO, it's very individual as a call, depends on what your...
[00:38:45.16] Karthik: There is no prescription that you can apply.
[00:38:48.20] Prashant: There is no prescription to it and it also depends on what your end goals were anyways.
[00:38:51.13] Karthik: That's correct.
[00:38:52.27] Prashant: For us, the primary reason why we did IPO was, we knew that we will get a tremendous amount of being listed in India. We might have gotten slightly better valuations by being listed in the US at that time. Things have changed now. That's a separate story. But at that time, we had an option to get listed in the US, but that was never the thought process to begin with. The thought process was that we knew why some people are not using and I will explain more. So even if you knew that, you are saving Rs 300 per passenger on convenience fees, you might still choose to not use EaseMyTrip because you have never seen us advertised. You have never heard about it before. And it's a high GMV product. You'll have to pay Rs 6,000 upfront and then you'll be able to save Rs 300 rupees, right?
[00:39:34.26] Karthik: Yes.
[00:39:35.26] Prashant: So, we knew that there is some bounce off, which is happening even at the place where they've seen the convenience fees not kick in.
[00:39:43.07] Karthik: Understood.
[00:39:43.06] Prashant: And we realized that's the trust factor, which we could do something about it. And we found by the virtue of being listed, we could cash upon it, without having to spend money on market.
[00:39:52.14] Karthik: That's right.
[00:39:55.02] Prashant: So this was the origination of the thought that, hey, what if we become a listed company? And first time when that word came out of one of our mouth. We're like, what?
[00:40:04.17] Karthik: This was what? 2017-2018?
[00:40:06.15] Prashant: This was somewhere in early 2018.
[00:40:08.15] Karthik: Understand.
[00:40:09.01] Prashant: Early 18. It was unfathomable at that time.
[00:40:12.27] Karthik: But, it's a daunting thought for all startup founders today.
[00:40:16.03] Prashant: Yes. That's how the origination came. And then it cumulated to why we should do it. Firstly, we never knew what value had we created for ourselves. Since it was bootstrap, we did not know.
[00:40:24.21] Karthik: Correct. You don't know what evaluations.
[00:40:26.25] Prashant: What value have we created for ourselves? For our team, for everybody.
[00:40:31.01] Karthik: That's right.
[00:40:32.01] Prashant: So a benchmark would be great. A benchmark, which does not force us to burn money would be even better.
[00:40:38.26] Karthik: Even better.
[00:40:39.03] Prashant: Even better. So, these were the thoughts by which we decided upon going public, early 2018, but we had a very clear roadmap of being listed somewhere in the year of 2020.
[00:40:50.09] Karthik: So timing-wise, it was a little off.
[00:40:52.00] Prashant: So I'll tell you a funny story around it. We planned everything in accordance to be listed in March 2020. For almost two years, we planned everything methodically to be listed in March 2020. In fact, we got some pre-IPO offers in January 2020, and I remember calling those people in February 2020, saying that, Hey, we are postponing the plan of being listed indefinitely for the time being, something big is coming.
[00:41:19.01] Karthik: Because you can see the trends first as a travel company?
[00:41:23.19] Prashant: As a travel company as well. China was happening. Italy started to happen at that time. Initially, your thought process is that as the country, not just as a travel company, you do not want to accept that something is going to happen to you or your country.
[00:41:35.07] Karthik: You're in denial for some time.
[00:41:37.22] Prashant: You are in denial. You're seeing people die in China on TV. You're like, oh wait, this is not going to happen in India. This is just one geography-limited issue. So you are in denial. That happened in the month of January.
[00:41:46.12] Karthik: That's right.
[00:41:47.13] Prashant: We are in the process of listing, so we are in denial, but then Italy happened, we are like, okay, no, this is going to go everywhere. And, we did the right thing of being proactive and calling on the investors ourselves.
[00:41:58.28] Karthik: Yeah, very _____. You would've lost a lot more time, bandwidth, capital, trying to run the process by any longer.
[00:42:03.05] Prashant: And then, since we proactively reached out, and we told them, we are going to delay, a year later when we went back to them.
[00:42:10.10] Karthik: Lots of respect.
[00:42:12.01] Prashant: Yes. So we got very good buys.
[00:42:12.17] Karthik: Yeah. I can imagine.
Did business suffer? Did your confidence get shaken given how tough that first year of the pandemic was in a travel perspective?
[00:42:23.16] Prashant: Business fell to half in terms of volumes, in terms of everything, we did a business of about 43,000 Crores in FY20. For FY21, it was 2200 Crores.
[00:42:32.20] Karthik: Understood.
[00:42:32.13] Prashant: So yes, definitely there was a lot of business loss, but we did not lose on the profitability side.
[00:42:37.27] Karthik: Nice.
[00:42:38.21] Prashant: We managed to remain profitable at the same level or even better.
[00:42:41.07] Karthik: Wow.
[00:42:41.25] Prashant: During this process. Did a bunch of things, which helped them get there. But then eventually we came out stronger. In fact, I think, many people ask us that, what if a pandemic happens? Again? My response is that it's not bad. The reason is that resilience.
[00:42:58.00] Karthik: It was tested and you came out shining.
[00:42:58.26] Prashant: Yeah. So we, our unit economics, allow us to even lose 1/4th of our business and be okay. While it might not be true for my competitors who are already in losses. So, it only puts us in a better position whenever this fog clears up.
[00:43:15.06] Karthik: What was the March 22 number? How big have you grown now?
[00:43:19.05] Prashant: Our profit after tax for FY20 was somewhere around 33 Cr For FY 21 was 61 Cr.
[00:43:27.16] Karthik: Nice.
[00:43:29.08] Prashant: And for FY22 was 107 Cr.
[00:43:32.16] Karthik: And the top line of.
[00:43:34.02] Prashant: Top line of FY22 was 3700 Cr, however, for the first half year of this year, we have crossed that top line.
[00:43:44.23] Karthik: Oh, wow. Revenge travel is back. And so, EaseMyTrip is gaining really. Super, super. That's fantastic. Wishing you a lot of luck for rest of the year and for many years beyond that.
Public happens, how was that experience? Because of this phenomenal bootstrap journey, I'm guessing, your team must have got something out of that journey? You still own as a family, 75% of the business?
[00:44:05.07] Prashant: That is correct.
[00:44:06.05] Karthik: It's fascinating where do you see the three of you five years from today?
[00:44:09.25] Prashant: We have discovered something very recently and we are super excited about that part, which is to grow internationally. We recently started about the Dubai Operations, which is EaseMyTrip.ae. which is basically, you can pay in Dirham in Local airlines,
[00:44:28.18] Karthik: Yeah. Localize the site.
[00:44:30.00] Prashant: Localize the site and launch it over there. So we did that about, 6-7 months ago. And the results have been nothing less than miraculous.
[00:44:37.20] Karthik: That's when we met and you said I just did this, I'm going to try this on a whim.
[00:44:42.10] Prashant: Exactly.
[00:44:42.19] Karthik: But it's bizarre that fun fact, by the way, for the audience is that we met for the first time, Thanks to Mr. Piyush Goyal.
[00:44:48.12] Prashant: Yes, in February 2022, who took both of us along with 20 other people on a delegation to the Middle East and so we have to thank the minister for that.
[00:44:59.12] Prashant: For making us meet.
[00:45:01.08] Karthik: For making us meet.
[00:45:01.27] Prashant: But yeah, during that time, we were setting up the office and in April 2022, we launched the website. Now, I'll tell you what's happening, why there's a tremendous amount of growth without spending money on marketing, which is coming. Worldwide, it's not just India phenomena, I would say almost all OTAs depend on getting some money from the consumers. Just the money they get from the airlines is not sufficient for them to run their businesses, which is why everywhere there is a format of convenience fees, which is charged.
[00:45:29.17] Karthik: Okay. It's not an Indian phenomenon.
[00:45:31.18] Prashant: It's not an Indian phenomenon. In India, the convenience fees is anywhere between Rs. 300 to Rs. 600. In the Middle East, it is anywhere between Rs. 1000 to Rs. 2000. I'm saying in Rupees.
[00:45:41.06] Karthik: Oh.
[00:45:41.23] Prashant: In the US, it's anywhere between Rs. 800 to Rs. 1200. In Europe, it's anywhere between Rs. 1500 to Rs. 3000 per passenger.
[00:45:52.05] Karthik: Wow.
[00:45:51.12] Prashant: It's a huge amount of money which consumers pay. Now, just try to see the kind of cost arbitrage we have over here.
[00:46:03.02] Karthik: You're now being becoming the bezel of this space. Your margin is my opportunity.
[00:46:06.13] Prashant: Your margin is my opportunity. Absolutely! So over here, the entire operations, we are running from India. The entire tech we are going to run from India. The only thing which we have to do is launch locally. We are sewing the right seeds. We are in no rush. Just the way we grow our business in India, we are in no rush to grow our business.
[00:46:22.25] Karthik: No, that's the beauty of building the business the way you have. There is nobody to feel artificially accountable for and now you are public. People can buy and sell what they believe is the future of EaseMyTrip.
[00:46:31.25] Prashant: For us, we are just sowing the right seeds, and we are looking forward to see where it takes us. But then definitely, theoretically speaking, there's a huge value waiting out there for us to grasp.
[00:46:40.15] Karthik: What is the approximate market cap of EaseMyTrip today?
[00:46:46.16] Prashant: I don't know the number, but today about 8,000-9,000 Cr.
[00:46:48.04] Karthik: Just thinking like this is a path to theoretically 10X from here.
[00:46:52.11] Prashant: This is where we believe. See India, we are growing. Of course, we are growing. We are looking forward to become the number one travel company in India, but then there are other growth avenues, which we have identified.
[00:47:00.24] Karthik: Super. This is great! So, a couple of fun questions and we'll get to the rapid-fire section because your family is kind of toyed with the idea of producing some Bollywood cinema. How's that experience been? How's that different from? Is it just fun or is it like something you can expect the Pitti brothers to be doing for a long time?
[00:47:22.25] Prashant: Actually we got into this because of EaseMyTrip. We actually never produced. It's more of a financing growth where we have lend money to the producers who give us the co-founder titles very graciously, but the idea is primarily to fund right before they are able to launch and then, get that money principal back, but get EaseMyTrip branding within. This is how it started and dabbled with it for some time, but then stopped.
[00:47:52.15] Karthik: So, it was an experiment.
[00:47:53.22] Prashant: It was an experiment.
[00:47:55.19] Karthik: And then, as my colleague Disha put it this like a meta-episode because you've been interviewing Unicorn founders before we started interviewing them. I know you do it on FM. What triggered that? How's that experience been?
[00:48:05.20] Prashant: So much of learning?
[00:48:08.08] Karthik: That's what I thought, first thing, amazing learning. As I am doing today for myself.
[00:48:09.20] Prashant: It's an extremely humbling experience. I've done almost 20 episodes, by now, and to learn from each one of them, I actually take notes as we are speaking. The way it happened was I just met the CEO of Red FM at a dinner party, and we said that let's do something together.
[00:48:25.24] Karthik: Usne bola kuch karte hain?
[00:48:29.00] Prashant: Let's do something together. And the idea of just came about that let's create an IP together where we can get the unicorn founders on the radio. This show basically goes all across India, 68 cities, on an average get heard by about 11 lac to 18 lac people per episode.
[00:48:42.02] Karthik: People don't realize when they're making social conversation at a dinner party, tell something to an entrepreneur is dangerous. Wo kar lega. Casual remark nahi karo.
[00:48:54.00] Prashant: Yeah. You cannot be casual. We are going to hound you afterwards.
[00:49:01.16] Karthik: I am glad that the dinner conversation happened. And, the country's better for, the enthusiasm that you've shown and hopefully our listeners will enjoy, this series as well. Shall we move to the rapid-fire?
[00:49:11.21] Prashant: Yeah, let's do it.
[00:49:12.26] Karthik: We've had a standard set of questions just to understand like how each entrepreneur thinks. What would you order for your last ever meal?
[00:49:18.17] Prashant: Yeah. So anybody who knows me knows that answer.
[00:49:23.04] Karthik: Okay. Clearly, I don't know you well enough until today. So that'll be a date someday in Delhi with you.
[00:49:29.03] Prashant: Yes, I'll tell you that I've done something special around it. Okay. I have marked the best Cholae Bhature walas in Delhi and NCR region.
[00:49:38.24] Karthik: Really? on your own map.
[00:49:36.02] Prashant: On the Google Maps. And I have created a system by which if I'm around, I get a ping so that I can eat those if I'm around that area.
[00:49:50.29] Karthik: Nice. Very nice. Is it shareable? Can I borrow that list?
[00:49:52.08] Prashant: Yeah, sure. We'll do that.
[00:49:54.03] Karthik: Let's do that.
[00:49:54.08] Prashant: I don't know if you share the same love with Cholae Bhature but yes.
[00:49:56.11] Karthik: Too many foods for me to be healthy. But yes, Cholae Bhature is also favorite. Current book that you're reading or a favorite book of all time something that's memorable in your journey?
[00:50:07.23] Prashant: It's hard to say any one particular book as the memorable one, but what I'm reading right now is [00:50:12.24] _____.
[00:50:13.22] Karthik: Great story.
[00:50:15.20] Prashant: It is a great story. It's an amazing.
[00:50:17.02] Karthik: You should write your own version of.
[00:50:18.08] Prashant: No, I don't think so. I'm entitled to do that right now.
[00:50:21.17] Karthik: At some point. That's epic story for where he wrote the story and where he left the story.
[00:50:30.05] Prashant: Oh, yes.
[00:50:28.25] Karthik: It's amazing
[00:50:29.14] Prashant: I haven't come to that last part yet. I'm in the middle of it right now and I'm loving it.
[00:52:29] Karthik: I'm actually, curiously wearing the villain of the story, which is [00:50:38.06] _____. So, I own a lot of _____, which is kind of ironic, but I love the book. My daughter got the non-adult version or the teen version of it. She loved it. that was the hallmark of a great entrepreneurial story. For 11-year-old,
[00:50:56.29] Prashant: She's 11-year-old.
[00:50:56.28] Karthik: Now, she is 14, but the book came and she was 11 and
[00:50:58.14] Prashant: She read at that time, wow.
[00:50:59.18] Karthik: She loved it and she said I want to read the adult version. And then I gave her that book, anyway. Best piece of advice you've got?
[00:51:08.23] Prashant: It's hard to remember. Was it an advice or was it, I remember what I go by, but somebody did say this. At least in my distant memory, I think that somebody has said this and that's how I picked it up. Which is that I'm usually more curious than cautious. I've learned this part of life where it's not a problem. It's actually only a pivoting, and the problem is just being too cautious. In fact, I had to train myself not to be too cautious. Coming from IIT, I think one of the big things which most IITians carry with them is the risk aversion. I studied too much to get into IIIT for 2 years. But my fate was that I was trying to be risk-averse. In the initial part of my career, I was actually mostly in analysis. And I would overthink and kill the enthusiasm for whatever was coming.
[00:51:59.16] Karthik: Understood. No super. I think, great advice for a lot of youngsters out there and similarly, since you have taken those risks and shied away from caution eventually, what would be probably your favorite failure and what did you learn from it?
[00:52:12.13] Prashant: I've done couple of startups, besides EaseMyTrip and one of them got sold, but one of them didn't do well. One of them got shut, by Facebook.
[00:52:20.16] Karthik: Okay.
[00:52:21.24] Prashant: It was doing too well because of which it got shut by Facebook. But the learning over there was that never built on somebody else's platform. I ran a dating. Yeah, I would call that as a dating app. We never called it as a dating app, but now in the hindsight, I can say it was primarily used for dating purposes. It was built on Facebook, and we got to a place where we were growing 3 million new users.
[00:52:45.01] Karthik: Wow. What is called sorry?
[00:52:45.26] Prashant: Neargroup. The entire growth came from the Philippines and US.
[00:52:50.15] Karthik: It happens because these tend to be like, you have to create a critical mass in micro geography. Suddenly, two geographies pick up.
[00:52:58.07] Prashant: Yeah. So there were two geographies, US and the Philippines. We were growing at, what? This happened only for about a year. It was only one to one and a half-year journey. We were growing by 5,000, 10,000 new user per day. Everything is cool. Facebook is cool, but then suddenly we spiked up. We started seeing 3 million new users a day happen for a week. Facebook shut us down.
[00:53:18.15] Karthik: Of course _____.
[00:53:19.16] Prashant: Yeah. Same story.
[00:53:19.24] Karthik: I didn't realize yours was a very similar story. I know you spoke about two or three fantastic customer moments, which is kind of at one level why you come to work to delight customers, anyone which you want to recount beyond what you've chatted about?
[00:53:33.27] Prashant: At EaseMyTrip, we are offering this service to consumers, which is basically get a full medical refund in case of any medical emergency. [00:53:40.20] Karthik: This is during the pandemic.
[00:53:41.25] Prashant: This is happening now as well.
[00:53:42.29] Karthik: Now also.
[00:53:44.24] Prashant: This is happening even until today. It's built into the system. You don't have to pay anything extra, just use EaseMyTrip and God forbid if there's any problem, or health-related, just upload your doctor's prescription.
[00:53:52.00] Karthik: Has it always been or is it a pandemic innovation?
[00:53:54.18] Prashant: This was a pandemic innovation, but we are continuing with that.
[00:53:57.09] Karthik: Super.
[00:53:58.22] Prashant: So, this was actually a pandemic. The reason was to bring people back to travel. This is why we started this service. Just upload the doctor's prescription and the money which we deducted or the airlines deducted, we will give it back. Even the money which airline deducted, we will give it back.
Very recently, there was this couple, who were supposed to fly on their honeymoon, but then the husband broke his leg and because of which they couldn't fly and he uploaded the doctor's prescription and then they wrote a thank you email because we gave the money and they are like. We have never flown before and this was the first time we were ever going to fly because it was their honeymoon. They were going to fly for the first time and that thank you email was pretty touching, it was just like realizing
[00:54:35.21] Karthik: What you live for.
[00:54:36.14] Prashant: These stories are always touching and kind of what you live for.
This has been fantastic. Thank you for a wonderful hour of your life shared with us and our audiences.
[00:54:46.03] Prashant: Pleasure is all mine.
[00:54:47.28] Karthik: Thanks Prashant. It was an absolute pleasure to host you.
Thanks, everyone for checking out X-Unicorns. This podcast is a Blume Ventures offering, and we will be releasing a new episode every Tuesday. Our sound engineer is Shreya Tiwari, and our producer is Vedant Naik of ManicPod Studios. Until next time, see you, Cheers!
Part of X-Unicorns
What is a unicorn? A mythical creature, known to be proud, untameable, fiercely independent and difficult to capture. When venture capitalist Aileen Lee first coined the term, the definition was strictly limited to privately-held companies valued at over $1 billion within a decade of its existence. This definition was applicable to only a select few Indian companies such as InMobi and Flipkart. That’s all there was in 2013 that fit this definition.
After more than a decade at Blume, it is now becoming clear that India is birthing new variants of this mythical creature and we’re calling them ‘X Unicorns’. But when we look at a Carbon Clean or a Dunzo, they don’t look like typical unicorns. Some look like zebras and hippos, others rhinos, gazelles, and seahorses. They look like they could be any shape or size as long as they have spouted a large single horn or even two for effect.
It doesn’t matter what the path to the unicorn is, it doesn’t matter when they go public, it doesn’t matter whether they have a body of a horse or any other creature in the animal kingdom — as long as it reaches there and we want to look back and celebrate the ones that have entered and are soon entering the X‑Unicorn club. The age of the X‑Unicorns is upon us. Silently, they grow unnoticed and emerge valiantly into the limelight.
Karthik ReddyKarthik Reddy founded Blume with Sanjay Nath in 2011. Karthik has shaped Blume’s investment approach and philosophy over the years, and in turn has overseen investments in some of Blume’s leading portfolio companies such as…
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