Netcore Cloud Revenue & Funding (2025)

the future of email marketing is and I said no way and he said no it is and I said prove it and then he showed me some some things and I said you have to show that on stage on that note please tell me welcome to Stage Rees Jane from netor did I get that right that's how that's how it happened that's how it happened take a seat so um this guy is if you go to India and you ask around and you say who was like the first big sort of software internet entrepreneur in India many people people will say Rees Jane because you launched India World in '98 launched it in ' 95 95 sold it in '99 this is sorry for doing this how many of you were born after 1995 there there you go the front row there we go all right you sold it then for what 116 million 99 yeah 115 115 million 99 um you then took all that money did you plow a bunch of that right into net core immediately no netore actually I didn't put in too much money because first 10 years we were too small not growing and then we did something right we basically started email and SMS Marketing in India and those just turned out cash so it's just perfect I didn't have to put much money in this was so we're looking at your Revenue graph right now 2003 you get going it was 2008 was that like your first million dollar year maybe yeah around that time around that time what started working really well like 2013 2018 we're going to 15 so two things happened 2013 uh 2018 2008 to 13 basically the email SMS Revenue started growing very rapidly until 20 8 we are doing some random stuff which wasn't making us any money okay um you know when you sell a company you think you can you're like God's gift to the world so you you think anything everything will work didn't happen um and your wife reminded you of that right absolutely yeah um you got that on video somewhere I do I do have that on video 2018 we also did around that time we did two things first is to the email SMS and we sell to b2c companies um mid to large sized companies we added marketing automation with a customer engagement piece and then we also started growing internationally mhm so we started expanding from India to Southeast Asia Middle East uh not yet the us at that time but that helped us essentially diversify both the product side and the Geo side spend a minute talking about your product strategy then the net core marketing Cloud so actually if you think about it the the real problem that businesses have is if you ask why are b2c businesses not more profitable and the real answer is that most of those profits or some of those profits are basically on the balance sheets of big adtech Google and meta I mean in many cases they're in a CA trap where the cost of customer acquisition is going up much faster than their revenues so where netor comes in is basically saying that look we can help you do more with your existing customers so it's a full stack where we have the communication channels email SMS WhatsApp RCS and all of that and then you also have the marketing automation piece the customer engagement so the journeys Etc the personalization bit and then we added search and product Discovery to it through an acquisition MH so full stack hopefully you guys are sort of grounded now on what Rees is building netc core.com if you want to follow along on your laptops we tried to map this full space right so I start off by just saying let me just do the bottom left of what you see on the screen here but then when I posted it on LinkedIn people said no no no you can't just talk about newsletters if you talk about email marketing I talk about cpass and Omni Channel and walk me through are mean are these the right buckets how do you think about email marketing in general see email marketing has been around for 20 25 years now there are different types there is the API based email marketing so C pass bottom C pass just use the API and send things out uh newsletters use so substack Etc they will send out uh anyone running a Blog will have newsletters going out upper upper right right campaign monitor clearly there then you have for smbs uh basically the the sort of integrated marketing stack like MailChimp yeah essentially for the small midsize businesses um then you have the Omni Channel which is where sort of netcode plays yep mid to large sized companies so brace sort of clavio U message bird CCH all of them are there uh and then you have sort of the Omni Channel and the CRM bit where email fits in as part of a multi Channel communication strategy because the customers are on different channels this is the bottom right here these are the big guys right these are the m&a players in the space yeah and but they are all Legacy you so Oracle Etc they had bought these email esps about 10 years ago mhm so you have now a new age of companies and there's a lot of interesting stuff happening in email of course which we'll talk about which I showed you y uh which I think can be transfered because in the US for e-commerce companies 20 to 40% revenue is coming from email so the push messages that we get that's the only way for pretty much the only way for them other than maybe SMS to bring customers back to their website or app where they do the transactions and that world is about to change MH and the reason SAS open is beautiful is that statement directly contradicts what arena from hoot kicked us off saying jenz is not looking at emails they ignore push notifications right it just tells you there's a way to do there's different ways to do everything and different things work for different people but this is working for e-commerce Brands it's working for you so much so that you said wow over the first I guess 15 years how much how much did your bank balance like cash in your bank did you build up to so we built it up to about 100 million in by 2020 no outside Capital didn't raise outside profits profits okay so you're sitting there looking you know I'm I'm refreshing my Chase account you're like whoa that's a lot of digits uh you say what do I do with all this money and you say you know what let's bet it all let's spend 100 million bucks cash to go acquire unbox why'd you do this deal so so couple of reasons one is we wanted to look at adjacencies we want first we want to do a large deal we done a couple of small tucks where you sort of add on to the tech but that's not as exciting as a larger deal which can do which did two things for us number one is gave us a complimentary product which we can sell into the same uh marketing department so unboxed uh does search and product Discovery so competitors include algolia Bloom reach Constructor so you can sort of place them there and it also gave us a presence in the US market now for a company like ours primarily India southeast Asia Emerging Markets it's very hard building an organic presence uh uh organic base and organic growth in the US and that's where unboxed came in so at one shot we got about 200 plus customers whom we could potentially cross- sell our products to mhm now people can see your m&a strategy going down the left side of the screen you're not just buying companies like unbox you just bought a mtek Services Agency why would a SAS company buy a service these are some of them are just Investments okay so what happens is when we go to our customers in fact this is I think very important in SAS I think and I'm seeing this coming up again and again what at least mid to large-sized companies are saying is we just don't want the platform add a thin Services layer so your platform becomes better and better every day it's what I call sort of Kaizen almost like the Japanese word continuous Improvement now as SAS companies most SAS companies are told not to get into services but the services layer actually can add a lot of stickiness so think of it as 80% SAS 20% services that thin layer I think can make accounts much more stickier especially when you're going to the mid to large- sized businesses and you're getting paid for it and you're getting paid for it this is a good trade and you also learn because customers are more willing to now tell you what are their problems because they want them solved and they don't necessarily have the internal teams I mean look at what is a typical adoption of most SAS platforms 30 40% topical what adoption adop adop 30 40% so that's the big challenge that I think an investment in a Services Company helps us solve that they can basically take over because the DNA is different they can help with Services Revenue keeps growing you know I get you on the phone you say Okay Nathan your six buckets look good for email marketing your team was very nice and then it was supposed to be a 15minute call it turns into an hourong call of you going this amp is the future amp is the future I'm going I don't know what the hell amp is I'm pretty good in SAS what is amp and why is this the future of email Market marketing so amp is let me just hold on so I don't feel stupid raise your hand if you have no idea what amp is please somebody okay all right now teach us so probably many of you all know amp for mobile Pages this is amp for email uh now what amp does so basically it's a Google tech Google and Yao both support it with with Gmail I'm going to give the visual first right this is this is what if you see this in your inbox it's being driven by amp so the idea is that you can do all the actions inside the email and I think that's a game Cher for b2c not as much for B2B because it right now works on Gmail IDs and Yoo IDs but if you're selling if your customers are selling to b2c uh the removal of the friction of the clickthrough to a website or app I mean we have seen five times 10 times increases in actions uh and just look at our own behavior you know when you see an email you got to click through how many times we do it but if you can now collect first party data Etc all inside the ma uh you can do gamification inside the mail ask questions do run surveys in newsletters right inside the mail and show the results in place uh you see the spin the wheel Etc all of these I think become great uh foundations for what I call sort of channels 2.0 the push channels which are there so email is just uh uh email is changing with amp and then there's WhatsApp coming in well hold on before we move on from that if these folks just want to get like a crash course and like how do I use amp and my email marketing what should they go search on Google okay so amp. is a good starting site but it's a bit outdated if you go to netcor cloud.com amp we have a lot of use cases spam netcor cloud.com um or just U email me and I'll send you lot of when you first showed me this what I thought is if I got something like this in my email inbox it feels gimmicky and I don't know if I would engage but look you're showing these results and you're showing the engagement is there and and I'm also thinking like will this render on my phone in Gmail how do you handle all these issues so the good news is that there is no downside that in case so it works in the Gmail app it will not work on the iOS native app okay the native mail app that's there yep so it works on Android works on um iOS amp works on the browser so I'd say about 60 70% of customers typically uh would be able to see the amp interactivity number one second is there's no downside because in case the amp doesn't show up the fallback mail does you're typically sending two emails the fallback mail the regular email and the amp mail and the male client Gmail or Y will decide uh which one basically to show now you're just to just to talk more about because I don't want people to see this and think this is gimmicky it's not the future I thought the same thing on our call and so I asked you some questions how many emails are being sent via netcor monthly today so we send out about 35 billion emails a month a a month a month it's a monthly number what percent of India's total email is that that's a small percentage okay uh my guess is you have probably two or 3% of the emails going up it's a big number oh yeah massive big number so it's it's I mean if you think about it there are about four five billion email IDs in the world each one's getting roughly 20 five to 10 emails a day it's almost a trillion marketing emails going out marketing transactional all kinds insane so look India I would say is probably ahead of us in terms of e-commerce in terms of the states of of using things like this so how do we translate these e-commerce use cases to SAS Founders right how could they use a spin the wheel or a you know a tell us what you like yeah for SAS uh Founders if you're sending to B2B that's a problem mhm and there's an alternative to amp which works in um in Apple email called CSS so it's not uh the sort of full functionality but you can have I I think the best place to use it is form fills M so some of the activities which you're doing on the landing page can actually be brought like we're seeing here is actually a good example could do this for your SAS business yeah so you can do it the thing is that once you do the submit it'll take you to a landing page on CSS but capture the data but the user has the customer has entered the data right in the email without the friction of the click through yeah and in amp you don't even have to go to the landing page the landing page is inside the email so for if you have customers who are b2c customers you know for shopping for searching inside email even collecting payments I mean we have companies uh in India for mutual funds collecting those uh what they call Sip in India systematic invest monthly pay payments for for funds all of that's now happening inside email and the the game changer really is that this whole the the clickthrough friction which always hindered uh uh email ctrs now that goes away imagine if ctrs go up 5x 10x what does that do for brands that really helps them build deeper better hotlines for for with their own customers get more first more zero party data do better personalization so just to give you guys an example how we're going to test this right we're specifically going to do a use case just like this for founder path if you guys anyone been on a Founder path webinar before or seen one raise your hand High okay so we usually have send an email out teasing the content then you have to go to a landing page put your stuff and we're going to test effectively signing up people to join our webinars inside the email like this so you never have to leave and see if we get more people doing it versus sending them all to a landing page which webinar registration is a great use case we should well and then we then will take all the we'll basically all these input field to the top we will then let's say AJ does it right and AJ says I'm doing a million of Revenue his birth date is this date he's male he's 37 years old we will then selectively use those merge fields and we'll say like on the webinar start time date two hours before start time we'll say Hey you know there's 120 other 37 year olds with a software company joining in two hours do you want to join so it's like subtle merge tags where it doesn't feel like we're just blasting merge tag Fields out to get a click through but it feels like you're talking to somebody and in fact even in newsletters that you send out imagine doing surveys polls right inside the newsletter and then you uh if you're using amp then you can see the results right in place so amp dodev or netcor cloud.com netcor cloud.com .d is the Google site but it's a little outdated they don't update it who who Who's who's who's thinking they might try a test or you're just going to explore when you get home it's interesting right who knows if it's the future or not we'll see we're also doing a bunch I mean our I'll just full transparency to everybody here we are really having trying to figure out how stand out and just email in general it's so busy um we've just started collecting mobile phone numbers and our mobile list like our whole Focus internally is growing our mobile list our SMS list you're also playing in this space briefly so what's very interesting now is that our interactions on mobile are also changing so SMS largely One Way MH now two innovations there WhatsApp you know how many how many people use WhatsApp in the room okay there you go it's about almost half 100 million plus users in the US on WhatsApp that's probably about 30 40% of the adult population uh you can do so you can do WhatsApp shops you can do all kinds of things inside WhatsApp the next big upgrade is coming on SMS well hold on before we move on from WhatsApp one thing I'll say to when I interview Founders in India and I say how did you get your big weight list how do you get your community together they all say a a WhatsApp gr oh yeah I asked an American founder the same thing they say slack so like what I will tell you is you are seeing incredibly f fast growing India companies that are building WhatsApp groups for their SAS businesses growing much faster than their us counterparts trying to drive everyone into a slack Channel anyone's got even a small International connect they will all be on WhatsApp yeah now what's also interesting is SMS is getting upgraded with RCS again RCS is from Google but it's being rolled out through operators essentially on Android and uh Apple's going to support it so if you think about it email uh WhatsApp and RCS they are transforming the one-way push channels into basically becoming two-way end points for conversion yep I'm fired up I mean this is the OG of software in India $116 million exit goes all in on net core you know fools around for a little bit doesn't work and then 2013 starts to hit it he now believes the future of email marketing truly is sort of this these embedded opt in forms inside of email to increase conversion rates 35 billion emails per month in India growing quickly bootstrapped 110 million bucks of Revenue making big bets we'll see big bets in the future check out his book profor please help me thank Rees Jane from netor thank you so much thank you

Intro good morning everyone so show offense how many of you all satisfied three criteria in your companies bootstrapped profitable and over 100 million in valuation probably maybe 15 million in ARR okay so we got probably three or four hands okay so for everyone else hopefully what I'm going to talk about next will inspire you to take The Road Less Traveled a proficon i coined this word a few years ago because I was Fed Up of listening to all the Unicorn stories I said we are profitable no one writes about us in the media we don't have venture capital we don't have great investors on our on our cap table and so I I thought about it and I came up with proficon to as a counter to unicorn so in a unicorn you get a billion dollars valuation Founders probably end up owning 10 of the company that's 100 million you build a proficon you build a 100 million dollar Revenue valuation company if you own most of it that's the same thing and it's much easier to get to 15 million than probably 200 million so I'm going to talk to you about two proficons that I have done both from India the first one I sold for 100 million plus and the second one I'm still running netcore we'll talk about that that's 100 million in Revenue so we'll go through all of this in the next 20 minutes so this is net course story we are 25 years old the first 10 years we did not grow because I was running the business and then I realized I am the bottleneck I got a CEO we'll talk more about that so the growth Journey really started from 2008 and this is in dollars the Indian rupee where most of our revenues come from depreciates three to four percent every year so the metric I like to use it's from a book The Outsiders by William Thorndike is price growth per share and if I look at the last 10 years the per share value of netcore has grown 25 percent kagger that's 10x in 10 years so my first proficon was India world so Let's Start with Section 1: The First $10M in Netcore I had gone back after doing my masters from Colombia I worked in the US two years went back my father had told me to do that because he had done the same in the 60s he said you're not staying in the US you come back do whatever you want here so my decision to go back was made first two and a half years after I went back I failed at everything I tried I thought I was God's gift to the world you know IIT Bombay education Colombia U.S and then I go back fail fail fail fail luckily um I came internet was just about starting at that point of time um I recognize the problem of Indians in the U.S wanting access to India news and other information I had the same problem when I was living here and I wanted to go back and so I thought the internet could be a great bridge of distance that's where I started India world my wife and I um we had just got married I had to shrink the previous company staff I I asked her to arrange marriage like Athens in India um badly knew each other I said why don't you come to work and work with me because I don't have to pay you I don't have too much money so um for the best decision I made for 30 years we've been working together um so India world started as a bunch of Internet portals out of India targeted at Indians outside of India um we were the first started very close to the time Yahoo and eBay did and I sold it five years later 415 million dollars 166 times Revenue and like Nathan said if I had probably been a few years a few months late I don't know what we would have got out of it but what's fascinating is how in the space of one month my evaluation went from 13 million one three to one one five so a VC had just decided not to invest at 13 million I'd signed I had signed the term sheet it was on the VC's table they are just sign we had done three months of due designs and then he says look I'm investing 4 million but you know everyone's else raising a lot of money you need eight million we are not going to invest another additional four million go find someone I said where do I find someone now I thought I was very depressed I said this is like the end everyone's raising money and then a month later okay there's something good which comes out of everything if that signature had happened my life would have not be taken a very different turn um a month later I've sold now the trick was two things first I had a banker I had one of India's best Bankers on my side um so when you're doing deals it's worth that extra two three percent to get the best Banker that you can makes a world of difference as Founders we are just unable to negotiate my banker told me you talk about India world and then keep your mouth shut we'll do the rest and then the second thing was they got two bidders with plenty of cash wanting to buy netcore one was a U.S bidder one was an Indian company which had just done an IPO I've done an IPO on NASDAQ and that was like we saw in probably some part of 2021 money was free at that time so they said whatever money we need we can raise it from NASDAQ so they bought us 115 million that day their stock price Zippy well listed on NASDAQ their stock price went up a billion dollars and in fact in the three months after the deal the stock kept going up it went about 7 billion there is a secondary offering to raise another 150 million at very small dilution so I got paid most of it was all cash so at age 32 I ended up with 115 million um thank you after almost five years of failure after failure I you never know the outcome when you're running a business so the next day when I wake up I mean it wasn't easy for us to sell it okay my wife and I had put in five years of work we were 20 people out of a small office uh in Mumbai and um uh the person leading the bank uh hemendra kothari medal in DSP Merrill Lynch in India he said Rajesh I was having some doubts still I said look you know we've put five years of blood and sweat building this business he said radish more important than knowing when to enter a business is knowing when to exit so this is the perfect time you'll get the money you have freedom you're a person of ideas do whatever you want in life very present words that's what I've done for the last 25 years we'll talk more about that the next day morning I wake up and my wife says she says you are not going to think about the money in the bank because if you think about it you will never do anything again in life the past is over get back to being an entrepreneur get back and start afresh and that was the origin of netcore so netcore I launched in just about uh 98.99 we just started a small separate entity because we are doing Tech rather than portals and we initially grew doing Let's jump into Section 2: Scaling Netcore to $100M SMS and email services in India and this is by the way after the 10 years where we did not grow so I'll leave that aside it's all there on my blog I'll talk about that later we generated cash because we're doing Enterprise Services we generated Surplus cash I realized I was the problem so I got a CEO um and once I got the CEO I said there only has to be one leader in the company it cannot be me it's the CEO so even if I disagree I have to tell the CEO privately rather than publicly because a company cannot run with two power centers and then we started investing in geographical and product expansion so through the last 15 years we've plowed back all that we have made into either expansion or in acquisitions um we acquired three companies two were small talking Tech Acquisitions Acquisitions + Investments = Constellation Customers for Life because that's the faster way to really expand the product on that you're doing and then we are a very large acquisition that we did unboxed ah again all from internal accruals uh close to 100 million dollars last year um again we paid cash for the business and solves the problem of site search and we then we expanded globally so this is net course stack uh today so we had started with email and SMS at the top we built customer engagement on our own for b2c companies and then we added personalization product experience Unistack: Frictionless Omnichannel Personalisation Enable deeper relationships, retention, and revenues search All Through Acquisitions so we built the full stack mix of organic and inorganic and uh then combined that with some Investments that we made so the idea is this idea of a constellation of companies so again using some of our cash to invest in adjacent areas to help with uh fulfilling all the needs of a marketer with fewer touch points fewer products this is geographical expansion we started in India and then we went to Southeast Asia Middle East and the last few years a couple of years with working to expand in U.S and Europe on today uh net core is like I said 100 million um close to 90 million of our Revenue comes from India and Emerging Markets 10 million from the US so the India Emerging Markets gives us a very solid cash stream ah which can then we are using to invest for expansion in U.S and iora this expansion is very important because the U.S market is 50 to 100 times larger than India so while the India market gives us a great Advantage we have wonderful marketers who are willing to tell us what's wrong with our product we are close to them so we build that out they are mobile first companies very large companies now probably India and us are the two largest fastest growing markets uh globally from our future uh potential point of view and then now the goal is to take that and sell it U.S and India so we have the advantage of a back-end product development backend support with a thin front end in the US what I.T services companies have done for many years we want to do it from the product side okay so next the three uh what I call the DNA really Let's jump into Section 3: Foundations and Future of net core the first one is profitable growth and I've never raised capital in my life I've tried many times a few years ago I tried to raise PE and funding and that was the time when people the p is basically said look we want more growth we won't want your profits and I said the profitable growth is one thing I will not compromise on the same peas are now talking to me again saying we love your profitable growth that's life the second is this idea of an infinite mindset Simon Sinex phrase that if you control your own destiny okay you own in our case 75 I'll talk about that 25 is employees and if you only own destiny while you should worry about quarter by quarter you also can take the Long View what does the world look like in two three years what's going on what's changing what are the new marketing Trends which are there you're not worried about sending Mis statements to some Analyst at a VC or PE fund who's going to come and raise five questions about some decimal points that you probably missed out on the third is employee service I'll talk about that I have a 3B framework which I sort of use in my company that you have to balance today and tomorrow so there is the BAU business as usual that has to be done better and better okay so that's your daily monthly rigor discipline because you can't compromise that that's what's going to generate the money which you can then invest into the future the second is and especially this is important for all of us as Founders it's one of the boosters in our business one of those next Horizons that you can look at which will give you the the next sort of product uplift whether it's a it's an acquisition whether it's a tuck and Tech acquisition then it's a new geography that you need to expand you've got to keep thinking what whether where is the growth coming next year uh Beyond uh the immediate one and then there are the big breakthroughs which what is the partnership what is that a big acquisition that you can look at doing which can completely change the trajectory of the future business so it's sort of similar to what McKinsey calls the three Horizons I think the Three B's is how I look at it and as a Founder I think if you can delegate some of the BAU stuff to um some of the other leaders it gives you more time to think about boosters and breakthroughs because there are tons of competitors who are out to kill you okay so you've got to keep thinking about what you're going to do next and the future is about how do in the words of Jim Collins how can we build an enduring great company so a few in between I'd spent about seven years on the periphery of Indian politics uh netcore kept growing through those years different experience for me um and uh when I came back I told my SEO that look you know whenever you get board running the business um you can sell we'll sell it another funny thing happened last two three years pandemic I started having conversations with marketers and I fell in love back with my own company and then I said look we've done all the hard work we've built it to this level now let's take it to Greater levels you know let's build a global company our Global Products company headquartered in India so the CEO decision uh which I mentioned earlier I think it's a very important one in our business because you have to look at what you are good at as Founders as a Founder I just don't like reporting to people reporting into me so I realized that early on and that's where I brought in a CEO who could worry about the day-to-day which gives me time and freedom to look at new ideas um to look at what's coming in what's coming tomorrow because as Founders you know half of us half of our Lives is about Imagining the future um at this stage we are also looking at how we can look at PE and IPO possibilities down the line we'll see about that and I think it's a great opportunity now with what's happening you know with uh with the Slowdown which is coming with companies distracted with layoffs and with a lot of changes like January to reset Industries so I'm going AdWaste to ProfitXL: Supersizing Profits Resetting ESP and Adtech Industries to talk about two ideas this idea of AD waste that in in the martech industry as opposed to ad Tech and b2c um and AD Tech actually there's there's a lot of there's 200 billion dollars of waste you know on reacquisition and wrong acquisition and if we can shift Focus from new customers to existing customers it opens up a 5X bigger Tam for com for Brands focused on existing customer relationships that's really the only way Brands can build profitable businesses so it's what I call profit Excel or can we go out and super size profits for Brands um I'll be writing about this on my blog very soon and then the other idea is what I call all an email and there's a great Innovation Example: All-In-Email No Landing Pages, No Clickthroughs opportunity to transform email very little Innovation and email so how can you use new technologies and not just one Innovation which can be copied by someone else but how can you Layer Two Innovation so three Innovations together which makes it harder for someone else so imagine your inbox emails and your Gmail okay with no landing pages no click-throughs conversion funnel moves right into the email it's an incredible breakthrough we are seeing 10 times uh increase in actions that uh of of consumers interacting with such males in India I mentioned about employee centricity we've had 25 stock options in netcore Employee Centricity: A Way of Life at Netcore Employees, not investors, as shareholders since 2007 so employees are a very integral part um so we look at employees not investors as our shareholders and we've introduced uh Perpetual buyback so we every year every six months I set a price which is of course lower than probably the external value when we give out esops if someone leaves today or down in the future they can get the difference so the esops are not illiquid for them so there's Perpetual liquidity we started this six months ago we have done a couple of BuyBacks also so this is very useful for employees doesn't put pressure on us to do an IPO in not so good markets so we've seen a lot of stuff in the last 18 odd minutes um couple of things to end with you know in my 30 years as an entrepreneur I've succeeded two times I failed 30 times so it's an average of one a year failure is never easy every failure I should have when I look back I should have ended it ended that thing much earlier I didn't listen to other people so three thoughts for you the first one is the life of an entrepreneur and you have to be ready for it I'm sure a lot of you all are running this is mountains Beyond mountains you're climbing one mountain you see a next one sometimes in your climbing a mountain you slip and you have to then climb back up and you have to like that feeling it's a phrase from Dan bricklin second is the Crux this is from Richard Drummond's book the trucks so when you're facing challenges I think he has a very simple idea one of the most important challenges you are facing pick the one which is the most doable no that's really what you've got to focus on that's what's going to help you take your company to the next level and third is to long form writing okay I From 30 years of entrepreneurship, 2 successes and 30 failures, here are 3 'proficorn' takeaways don't do much on Twitter or LinkedIn but I write a blog I've been writing for almost 20 years the seven years when I was doing my political stuff I did not write I started back in the pandemic every day I publish every day um uh write my Economist with my name rajasthan.com there's got a lot of writings on marketing entrepreneurship India I have a book coming out later this year so hopefully startup do proficon by the same name thank you foreign [Applause]

Introduction hey folks my guest today is rajesh jain he's the founder of net core cloud a global marketing technology company that offers ai-powered marketing automations and analytics solutions rajesh are you ready to take us to the top yes all right so this is uh this is interesting platform we can say you're one maybe one of the ogs in the marketing automation space that means original gangster so tell us what you're building what what are customers paying you for yeah so we got a full stack mardec platform so if i i'll put it in comparison to what u.s companies do so it'll be easier for people to understand because we do a lot of things uh we come from india emerging markets have been a playground so far and we are now working to expand in the us and uh and europe now so we have at the lowest end we have a communications layer which is like twilio sendgrid api plus campaign management then we have engagement customer engagement for b2c companies like what braze offers and then there is the experience layer product experience so nudges and a b testing inside there like pendo which does for b2b companies we do for b2c companies yep so it's like raised plus twilio plus pendo appendo for b2c um and then there is also a search so search personalization recommendations a bit like dynamic yield and nostro and we recently acquired a company for 100 million dollars basically invested and one of the largest deals out of india in the sas space it's a company which primarily operates in the u.s company called unboxed and uh they essentially do search recommendations so on-site search exactly what amazon does on its site when you do the search for other sites so b2c companies you see companies retailers they do recommendations and they do pin the product information management now are you mainly selling to e-commerce brands oh yes so all our customers are basically b2c companies globally very big in emerging markets so india southeast asia middle east and africa and we've got now about Currently serving 5000 customers 40 customers that net core has directly in the us and about 100 odd customers that unboxed us in the u.s so pretty significant presence now uh in the us also how many total customers is net core working with including unboxed customers uh so netcode totally has about 5000 customers um but we have a few other products which basically add up to this in the communications and my text space we would have about about about a thousand plus customers i see very cool now talk to me about the unboxed deal here for a second they had raised 14.5 million from some vcs as well right so when you guys bought put in 100 million were you buying 100 equity or just the majority 60 well we've bought 90 percent in the company founders own 10 percent uh the remaining 10 they continue to run the company and prashanth great team there so investors are out we are in and we'll work together there's a great cross-sell opportunity actually with unboxed because unbox customers can now get the rest of our stack so email engagement etc and we can take unbox to our customers across india and emerging markets oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2807 interviews i've done manually saves you a lot of time well we've done this we've built it into the beautiful interface inside of founder path check this out i'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the past 88 days and even set goals for valuation this year now the secret evaluation is there's many different ways to value a sas business so the reason you're going to see three or four different valuations inside of your frowner path dashboard this is all free by the way is because depending on who's doing the buying of your sas company you're going to get a different valuation a vc is going to pay a different valuation private equity firm is different if you're going to do a minority sale that's different and if you sell the whole business that's a different valuation you can see all those when i hover over here right so the teal is what a vc would pay yellow is what private equity and red is if you sold the whole thing outright now what's cool about this is this is not built off random data again you guys hear these interviews on youtube all these datas are built from real-time valuation data points founders share with us on the show so traction 1.2 million seed round 3.7 raised they sold 22 to their business go in here and filter by the event maybe you only want to see companies that have sold the whole business well here are a bunch that have been acquired the valuation and the multiple maybe you're going out right now and you're raising your seed round well go in here and look at all this recent seed deals that went down what they raised what valuation they raised at and what percent that they sold there's never been a larger data set of sas valuations than what you can get now inside of founder path and we're thrilled to bring it to you all right we're going to go back to the youtube video here in a second but if you want to check this tool out if you want to jump in and sign up you can check it out for free to get your valuation at this link this link founderpath.com forward slash products forward slash evaluations or if you go to founderprep.com and hover over products click on get your valuation here and go ahead and sign up to give it a whirl again all that valuation data live right inside the platform i hope to see you there all right let's jump back into the interview now just to rajesh paint a picture here this is a great setup obviously for those two founders because now they're building with you and maybe they obviously have some equity in a combined company but they had raised 14.5 million total their last run was a series c in 2017 for 12.5 million now if they were raising 12.5 million that was probably out of valuation at around 100 million so now three four years later they're effectively selling for 100 million right so this was not a big win for the vcs that had money on right i think vc's got a reasonable return i think uh on on their investment um and actually the way we got to look at it is that that multiple rounds of vc so early vc is of course got a bigger bigger multiple um and i think what uh for unboxed basically the advantage uh that netco really brings in is um that we can we bring in additional capital we bring in our capabilities our customers across the region and for their customers i think the ability to actually have a a fuller solution so with with what net core also does email engagement and that essentially uh and i think we are seeing this happen in the sas space is that marketers basically over time will want to work with fewer vendors so there's a consolidation which is happening um and uh i think the other big thesis that we've been working on is really the big shift which will happen from ad tech to martech and i can explain that i would love to i don't want people to get lost here though on the headline which is you guys have some significant scale you reported to the economic times i believe last year that you broke a 75 million dollar run rate is that accurate yes so we are ourselves at about 85 now and we had unboxed 10 million so we have very close to 100 million ar now and completely bootstrapped Bootstrapped that's my favorite part of this whole story completely you should be on the cover of every magazine on every billboard people should be celebrating when did you found the company what year okay so i founded it 25 years ago wow after i sold my first company for 100 million dollars wow and when we it was india's first internet portals basically targeted at uh indians and indians globally especially in the us what was that first company india we had a family of internet portals uh so we i i set up india's first internet portals in march 1995. so we i started just around the time yao and ebay did so i was very early i did it pretty much all from india and uh we got a very good exit when satyam infoway which was listed on nasdaq sifi bought my company for 115 million primarily uh pretty much all cash uh in november 99 we sold i think at the right time just before then yeah that's amazing and were you the sole founder there yes we were so india world and net core have one thing in common and you love this one we are both what i call proficons so profitable private promoter bootstrapped and highly valuable highly valuable excess of 100 million what did you what was the word you just used proficon so like unicorn proficon so p-r-o-f-i c-o-r-n i love that i'm stealing that profi proficorn i love that yes proficon absolutely nathan okay so give us more Monthly recurring revenue history here 95 million run rate today 75 million in 2021 what year did you break a million in revenue you launched in 1998 yeah so we've had a few pivots along the way so the first 10 years netco did not grow much and we hit about a million dollars i would say in 2007 or eight thereabouts uh and uh we've basically got two streams so we have the high margin this is what we call the high margin business the platform business so that's email martech and all the other things that i spoke about we also have and that we sell globally we also have an sms business which we only do in india sms of course is the lower margin and uh the revenues are split between these two businesses uh for for net core uh sms also is is doing very well so basically we combine c pass and martech together so like twilio has we don't know much of voice but other than that uh all of the the full stack basically so the way i think of it is that the trend is really towards digital experience uh platforms really so other than the content part dxps and uh big and emerging markets and now looking to grow of course more aggressively in u.s and europe okay uh fill out the revenue story though for me so a million in 2018 what do you have in 2015 revenue-wise do you remember oh um 2015. i don't remember see um when did you break 10 million yeah i think we would have been over 10 million yeah okay and what about 2018 uh 2018 would have been um i'd say about uh 50 odd million okay so you had a lot of growth from 2015 to 2018 in three years you grew from 10 million to 50 million what drove most of that growth uh so two things uh basically the big drivers have been that sms grew in india and we also expanded the other platform business outside of india so the challenge for us is that the indian market is actually quite small even though the customer base is very large companies don't pay a lot of money yet so the email market plus the martech uh business put together would probably be just about 150 odd million dollars across uh maybe 200 million across india and southeast asia so if you have to grow we've got to expand outside and over the last three years the real growth has come from our platform business and not as much we haven't focused as much on the sms business because sms is low margin a lot of operator involvement and we only do that in india but it's a healthy healthy profit margin business but where where we see the future growth coming really is and of course the valuation of the business comes from the market side of the business email and the amount accept now you said that you're eyeing 150 million in aor by 2024. i think you're going to beat that oh yes now with uh with net core plus unboxed together i think we should be doing uh much more than that we're also planning to do an ipo in india in about 12 months time um yes and because we are 25 owned by employees so i've got to make sure they also get some wealth creation i love that okay so the equity today you own uh 75 employees own 25. absolutely i love this okay um 75 is rajesh okay great and then um i guess take me back you know profits are a beautiful thing i rarely get to talk about them on the show though because so few people have them so we should talk about them right so when you Profits did 75 million last year how much profit so um our profit margins have basically been about 17 to 18 percent you said point 17 yep you profited about 12 13 million last year something like that yes a million a million a month yeah million a month is what we've been doing and then that's how the internal accruals have been missing the internal accruals to help us do the acquisition so the profits basically we've used to invest into unboxed yep now did you did you go raise debt to do that unbox deal or it was 100 million of your own money yeah we are debt-free zero debt so where'd you get 100 million from if you're only profiting like 10 million a year did you do this your bank had 100 million in it and you use it on unbox you've been profitable for 15 years wow wow so before unboxed how much cash did you have in the bank like 120 130 million yeah just over 100 so um plenty okay so was that ner i mean that must be a little nerve-wracking right you're spending almost all of your cash balance on one deal yeah so here's basically what we look at it is an unbox is a great asset and uh uh i think now that we've got the critical scale it also allows us to tap it at the public markets we could have gone public in india probably even a year earlier but what i wanted was a story which combines uh which is a globe a global company not just india and emerging markets but also with a significant presence in the us and that's what unboxed gives us it gives a fuller stack also and i think i i think the future really is going to be more on on on there's going to be more consolidation so you want to look at funds raised from the ipo so we give we get a currency plus we get cash both for for further consolidation as we go forward rajish i imagine a lot of people have tried to buy you uh don't tell me who but what is the most what's the size the dollar amount of the most recent acquisition offer you turn down ah we haven't uh got too many acquisition offers anything why not yeah but see i mean companies like us should basically i'd say you know profitable companies not too many in this space um emerging markets are going to grow very well uh going forward we've got some great innovations coming up email 2.0 what we call the martech 2.0 stack also which basically uh brings in a lot of ai for predictive segmentation etc email 2.0 brings in some very interesting ideas to transform email which has been around for a long time i'd say that companies like ours should basically we got a mix of c pass and and the high and the platform business i'd say we'd probably be valued anywhere between six and ten times revenues uh and maybe with some bonus for being profitable i know you deserve a bonus so maybe 800 900 million dollar evaluations if you ipo in 12 months you could be you know ipoi like a 1.5 2 billion valuation something like that hopefully uh i don't want to preempt uh the markets you know how they've been yeah yeah i mean i i see i i think for us the the intermediate valuations are not that critical because i really want to build it up as jim collins puts it in an enduring great company we've been around for 25 years and we want to be around for another 100 years i love that talk to me a little bit about churn what's your net dollar retention today about 123 and and how much of that is coming from expansion about uh uh i'd say about 13 to 15 in expansion well i guess sorry to get net dollar retention you want you subtract your churn you add back your expansion so shouldn't your expansion be more than 23 no so okay okay so let me correct that uh um i meant the basically uh uh i thought what you meant was the growth from existing existing accounts yeah in our you're talking nrrr right not the grr number yeah nrr yeah nrr would be roughly about uh 30 we have churn of roughly about five percent so five to seven percent so that's monthly no annually annually okay got it so you're churning five and you're expanding like 30 so net net retention is like 125 something like that and a platform business is growing totally about 45 percent so you add another 25 and 20 plus percent of new customers i see and rajesh how many folks are full-time on the team today we are 750 people uh in net core another 150 people in unboxed okay and uh how many engineers total engineers is about 175. wow okay and how many sales reps that carry a quota that's 175 in netcode and add maybe another 60 and unbox i've got to add now both the companies we still run them independently okay how many sales reps of the quota sales reps for would be about 100 plus do they all have a quota uh i would say 65 to 70 would be a quota so what you've also got to remember in netcode is we've got two smaller businesses also which have been our legacy businesses so they also have about 100 plus 125 people working on those so we have essentially uh linux based and linux and uh resell office and google gmail in india that's been a legacy business we have also our own linux based server we also do some amount of acquisition so at tech type business it helps us get into companies um the mail server business has been around for a long time so we basically said we sell security and infra solutions for companies in india largely well and you have a you have huge penetration in india right i think you said 75 of india's email traffic and 50 of asia's email traffic goes through net core cloud right absolutely 18 18 billion emails a month uh which is i think which would be among one of the largest ones i mean we are probably one of the few independent email companies left in the world given that most of the other companies have been acquired emails per month you said right email per month yeah 18 yeah it's incredible all right regis heck of a story here let's wrap up with the famous five number one what's your favorite book favorite book is jim's jim collins the book which came out about a year and a half ago beyond entrepreneurship 2.0 number two is there a ceo you're following or studying so um essentially i think um are a couple of our competitors basically i i think uh twilio has done a fantastic job there's a lot to learn from twilio and of course salesforce both the ceos i think have a lot to teach us on how to do how to build very big sas companies number three besides your own what's your favorite online tool for building net core online tool for me online tool for that you use to build the company oh um uh we are we we use salesforce a lot internally uh and uh fresh fresh works yup for girish your ish with a nice comp for you in the public market yes number number four how many hours i sleep to get every night i get about six and a half to seven hours of sleep every night and i wake up at 4 30 so i sleep early so this is late for me by my standards oh amazing what's your situation married single kids okay married for 29 years and have a kid who's 17 years old okay so one one kid one kid yes okay and how old are you rajish i'm 54 i'll be 55 in august 54 years young last question something you wish you knew when you were 20 okay so i wish someone had told me how important things other than engineering uh would have been especially economics psychology a lot of these disciplines the liberal arts basically are something i think i realized the value of liberal arts pretty late in life so uh i wish i had known that when i was 20. guys we found a gem today it's so rare a profitable company doing almost 100 million dollars in revenue launched in 1998 they broke a million revenue in 2008 50 million in 2018 75 million last year they did their first acquisition paid over 100 million bucks of cash which was about 90 percent of their total cash in the bank of the point so a big bet added on 10 million bucks of revenue but it helps regis build out a full stack and move into the u.s market with an acquisition company called unboxed they're looking at an ip in the next 12 to 24 months we will see what happens rajish thanks for taking us to the top thank you very much nathan great conversation one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m central to make sure you don't miss any of that make sure you click the subscribe button below here on youtube the big red button and then click the little bell notification to make sure you get notifications when we do go live i wouldn't want you to miss breaking news in the sas world whether it's an acquisition a big fundraise a big sale a big profitability statement or something else i don't want you to miss it additionally if you want to take this conversation deeper and further we have by far the largest private slack community for b2b sas founders you want to get in there we've probably talked about your tool if you're running a company or your firm if you're investing you can go in there and quickly search and see what people are saying sign up for that at nathan lacka dot com forward slash slack in the meantime i'm hanging out with you here on youtube i'll be in the comments for the next 30 minutes feel free to let me know what you thought about this episode if you enjoyed it click the thumbs up we get a lot of haters that are mad at how aggressive i am on these shows but i do it so that we 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