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Pradeep Singh | Looking for ‘impact of scale’, an entrepreneur tries again

Pradeep Singh | Looking for ‘impact of scale’, an entrepreneur tries again
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First Published: Thu, Apr 21 2011. 12 38 AM IST

New start-up: Pengala Learning founder Pradeep Singh. Aniruddha Chowdhury/Mint
New start-up: Pengala Learning founder Pradeep Singh. Aniruddha Chowdhury/Mint
Updated: Thu, Apr 21 2011. 12 38 AM IST
Bangalore: It was 1994.
Pradeep Singh, a Harvard Business School (HBS) alumnus and Microsoft Corp. veteran asked for a meeting with N.R. Narayana Murthy and Nandan Nilekani on a little business idea he had. Back then, when you were from Microsoft, people listened.
New start-up: Pengala Learning founder Pradeep Singh. Aniruddha Chowdhury/Mint
Singh told the duo about an email tech support company he wanted to set up and how he was convinced back-end support would eventually become big, very big. In some ways, it was back-office services or business process outsourcing he was describing. Only, back then, no one knew it by the name (in 2010-11, the back-office services industry was worth $14.1 billion, or around Rs62,600 crore today, by revenue according to industry lobby group Nasscom).
Murthy agreed the potential was there, says Singh. “We can take 65%; you can take 35%,” he said and I thought he was already negotiating. Then he picked up a newspaper, placed it in front of me and said, “There will be a photograph of me and Nandan in the papers and you will be mentioned somewhere in the fine print. You don’t need us. Go and do it on your own.”
And so, Singh went and did just that. The company was Aditi Technologies Pvt. Ltd and it provided support to Microsoft customers on the CompuServe forum (yes, this was back then).
Singh’s dream didn’t have a happy ending, though. First, Microsoft ended its partnership with CompuServe and then, a few years later, the customer relationship management product company he had spun off Aditi, Talisma Corp. Pvt. Ltd became, in his own words, “a debacle”.
Still, entrepreneurs are not easily deterred. Singh is back with a new start-up, and he claims to have both a business case and an “aspirational case”.
Pengala (the company is Pengala Learning Pvt. Ltd) is a digital learning platform that hopes to solve one of the biggest challenges in the education business in India: how can a school or a test preparation institute scale up without adding teachers and bricks and mortar classrooms?
“The business case is pretty solid. We don’t build content. We don’t sell it. So, no sales and marketing costs. In between, we take a piece of the action. There is the guy with a high propensity to pay—the guy preparing for IIT JEE (the joint entrance examination for admission to the Indian Institutes of Technology) without a coaching centre nearby—that gets the cash flow positive thing going…,” explains Singh.
Then there is the aspirational case. “After you feed people, what is next? To teach them. The scale is enormous. There is no way to do it with the bricks and mortar model. There is no easy answer. If the difficult answer works, there is enormous impact.”
Deepak Srinath, director at Viedea Capital Advisors Pvt. Ltd, said that if Pengala could make its platform interactive and provide a genuine learning experience, there was no doubt that the market for it existed. “Test prep institutions are strong regionally, but no one has a national footprint. And if you are scaling with a bricks and mortar, franchisee type model, maintaining quality can be difficult,” he said.
Those doubting the idea would do well to read up on Singh’s past, though there is no guarantee that a man’s history has any bearing on his future.
Even today, most students graduate from US business-schools in debt. When Singh graduated from HBS in 1984, he had $60,000 in the bank.
So, he went and bought a second-hand BMW, and he and his wife Ruby drove around the US for six weeks.
The money came from a resume printing service he ran, which brought in revenue of $125,000.
“Remember, this is 1984, with no ready-made laser printers around. The average HBS graduate is incredibly insecure about his resume—particular type of paper, watermark, thickness, and so on. My first year I passed with honours; barely made (it through the) second year. This had turned out to be a full time job!”
He may have just been lucky, but Singh is a man who likes to look back on his life in terms of the “lotteries” he has won. The first, he says, was the “womb lottery”.
“I was born of refugee parents, Sikhs from Lahore—open-minded liberal. I went from barely making first grade in school to going through IIT-JEE preparations and making it to IIT, Delhi.”
The second lottery was admission to HBS. “Incredibly unpredictable process,” he says grinning. “They pretty much pile up the applications, and throw darts to choose!”
HBS had other pluses: summer internship at McKinsey and Co. (he was hired by Rajat Gupta). Then he went to work for Texas Instruments Inc.
And finally, when he was set to return to McKinsey, a friend told him about a small company in Seattle that few people had heard of that was making around $100 million.
It was called Microsoft. Singh’s hiring manager was Jeff Raikes, who runs the Gates Foundation today. The job came with some nice stock options.
That was the third lottery.
Since then, the law of averages seems to have caught up with Singh.
Sure, Aditi is still around, and will end the year with $80-85 million in revenue. And Singh says that when he walks in, sees some people laughing over a joke in a corner, others engaged in an intense debate in another, he thinks to himself, “Hey, I made this happen.”
But he admits he’d like nothing more than to make a big impact.
Who knows? Maybe he’ll win the lottery again.
sridhar.c@livemint.com
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First Published: Thu, Apr 21 2011. 12 38 AM IST