Vijay Shekhar Sharma: The ‘no cash’ champion
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In the last two weeks, Vijay Shekhar Sharma, 38, has become one of the most talked-about men in the country. He and his company’s flagship product Paytm are abuzz on social media.
On 8 November, as the government declared Rs500 and Rs1,000 currency notes illegal, Sharma was quick to promote “Paytmkaro” to the masses. The Paytm logo is becoming a common site on wedding invites, parking areas and everywhere from temples to tea stalls. As a nation deals with an unexpected cash crunch, mobile wallets like Paytm have seen a spike in adoption.
“I want Paytm to be a verb, more than a noun,” says Sharma, oblivious to the fact that in just a week’s time his wish would actually come true. We are meeting at Indian Accent, Delhi, for lunch, 10 days before demonetization was set in motion. Sharma loves the food here and has a recommendation list—some chaat, and then some more chaat.
Over the next two-and-a-half hours we talk about everything from payments bank licences to his impending trip to China, from US elections to his childhood days in Aligarh, Uttar Pradesh. A conversation with Sharma is best when there is no set agenda and no one knocking at the meeting room door for that urgent signature or urgent call.
I let Sharma steer the conversation. Dressed in a blue shirt and dark trousers, Sharma narrates the story of how it all began. He was 15 when he joined college. “I studied in a Hindi-medium school and I could do anything if instructed in Hindi. That soon became my biggest weakness. I was bad in the competitive language, English.”
Sharma started reading two books at a time. He would study in Hindi and use a translation book to learn English. He got admission in the Delhi College of Engineering (now called Delhi Technological University) and for the first time moved to a big city. Poor communication skills relegated him to the back benches of the classroom and eventually to the computer science lab.
“Teacher sawaal poochti thi aur main stabdh reh jaata tha (When the teacher asked questions I used to freeze),” laughs Sharma. “I decided it was better not to attend classes.”
In the second year of college, Sharma, with three friends, started a company called XS Corps. “The tag line was XS Corp—The internet giant,” guffaws Sharma, remembering how the magazines writing on Silicon Valley start-ups had an impact on him. Sharma scoured magazines from the Sunday market in Daryaganj and started learning about computers and the Internet. He wanted to earn money and support his family.
“I made a business card. I wanted to teach people (to use) the Internet. I knew I had the skill… I could make websites. I saw job advertisements in newspapers and decided to give it a try. One interviewer liked me but was angry after I told him that I was still a student.”
Sharma was not one to give up easily. He cracked a deal with the interviewer and told him to outsource the work to him. “I actually found a business model to find work… I would prepare for the job and then ask them to give me the work instead of the job. I used the college Internet and computer to do the work and e-mailed it to the companies.”
It was 1997 and Sharma was making electronic itineraries for Jet Airways; he also made the website for the India tourism department. “I am very impatient… I used to walk out of examinations... I wanted to achieve a lot in a short span,” says Sharma. “But due to the financial conditions at home, I had an obligation to take a job.”
By 1998, XS Corps was attempting to make a search engine in India. Though the idea could not take off due to a paucity of funds, the company created a content management tool where media agencies such as Living Media and Express Group used to host their content. In the final year of college, Sharma decided to take the highest-paid job on campus with River Run Software.
“Memories of that day are still fresh in my mind. The immense pressure of sitting in front of the interview board… I still feel the same pressure every time I am sitting in front of Jack Ma (a big inspiration for Sharma. Jack’s company Alibaba and its payments firm Ant Financials own 40% stake in One97 Communications Pvt. Ltd, the company Sharma founded in 2000), or in front of investors trying to raise funds. My mind is constantly telling me that this step, this interview, will help me take a quantum leap. And I have had this moment so many times… even now when I met the RBI governor.”
In 1999, XS Corps was sold to a US entrepreneur for a million dollars in cash and some stock. Within months, Sharma had helped his father pay off his loan taken from friends and family and decided to quit the company. Fishing about for something to do, Sharma founded One97 Communications and decided to create an online directory that people could access through SMS. The idea worked and Sharma expanded to value-added services such as live astrology, cricket, songs, etc.
However, he had not realized that recovering money from telecom operators was not easy. “We never had a collection team, outstanding funds with telecom companies was mounting and we were very near a collapse. Just three years after I used to order vodka shots without vodka (he is a teetotaler) in fancy hotels, I had no money to have dinner. It was the winter of 2003 and I was again hunting for jobs in newspapers and looking for day jobs. I did not even have money to buy a cup of tea.”
Sharma would go from door to door, fix computers for people and get a daily wage. Sharma was forced to sell a 40% stake in One97 for a mere Rs8 lakh. “I do regret it, but at that time there was no one to guide me or suggest a solution.
“When I remember those days, I tell myself that there is nothing that can corrupt me… I have seen the worst. This is a blessing what I have right now,” he smiles.
Sharma once again turned the business around. One97 reinvented itself from content business to payments. There were objections from the company board; they were concerned about the non-existent smartphone market. However, Sharma was confident. And the rest, as they say, is history.
“The obligation to stay relevant has been the biggest motivation in my career,” says Sharma. “We have changed the company four times—from a content company to payment company to commerce to a payment bank company.”
A week after the announcement on demonetization, I meet Sharma again. Sharma reads out some tweets from his phone. He is amazed by the growing number of transactions on Paytm. “We are doing more than five million transactions a day.” Since 9 November, Paytm claims to have registered a 700% increase in overall traffic and 1,000% growth in the value of money added to Paytm accounts. The company, which was expecting to achieve a billion dollar in GMV (gross merchandise value) by 2020, now expects to achieve that by March owing to demonetization.
He wants to hire 9,000 people to help him achieve his dream of taking India digital. “With this opportunity…people would need new bank accounts and with our payment bank licence we can easily do that. Now we need large distribution.” Sharma is one of the 11 recipients of the payment bank licence RBI gave out earlier this year.
A Jim Morrison fan, Sharma already knows what his last words would be: “O great creator of being, grant us one more hour to perform our art and perfect our lives.”