Kranthi Vistakula is happy that his company Dhama Innovations Pvt. Ltd. (Dhama) is headed in the direction he had envisioned. Having set it up in 2008, the Hyderabad-based company was initially catering to a high value/ high margin usage with a very small customer base that was not too beneficial. When The Smart CEO spoke to Vistakula in September 2010, he had voiced his desire to see his products make an impact on the everyday life of the common man. The challenge back then was to identify potential markets and customise the technology accordingly.
The patented technology ClimaCon, which Vistakula developed while pursuing his Masters at Massachusetts Institute of Technology (MIT), incorporates heat transport mechanisms to adjust the body temperature to exterior weather conditions. Dhama has now introduced this innovative technology through various products that are useful to everyday functioning. “We have recently come out with nine different products under three new ranges – pain management, corporate gifting and novelty items, and products for the hospitality sector,” says the 30-year-old founder and CEO of Dhama. Though Dhama began trials with the Army initially, the focus has moved away from the defence industry as he finds the process very slow.
Now, corporate gifting is one of the company’s mainstays and it constitutes 40 per cent to 50 per cent of its revenues. One particular corporate gift – USB-powered ‘Comet’ coasters that help keep beverages hot or cold have sold over 10,000 units last year. Companies such as Ashok Leyland and HCL are now among Dhama’s list of corporate clients.
Enhancing its portfolio
Dhama’s newer products are also seeing steady growth in sales like its ‘Go’ range of products for reducing arthritis and knee pain, back pain and pain in the limbs. This year, Vistakula has hired a team of four to strengthen Dhama’s sales and marketing reach. Having invested in technology earlier, the company is now mostly pouring its revenues into its customer reach effort. Online sales have also picked up through its website Climawareonline.com (set up in 2011) and it now constitutes 5 per cent– 10 per cent of its overall sales. “For our pain management products, we have taken up direct selling by targeting retirement homes, parks and through referrals,” shares Vistakula.
The products are sold under various labels – for instance, its Climaware range of products is for sportspersons. And its three products were tested with the help of Kolkata Knight Riders’ physiotherapist Andrew Leipus and developed based on his feedback. The final products of this range will be launched in October this year. Though the base technology remains the same, it is customised according to each product. Eve is another Dhama product targeted at women with menstrual pain. It is a light belt worn under the clothes around the lower abdomen. “Eve applies an approved methodology of both heat and pulse therapy, and the combination gives pain relief. We had tested the product on 150 women over six to eight months. We started selling Eve a couple of months ago and have tied up with a large company with an effective distribution network to ensure a pan-India presence. So far, we have managed to sell a few hundreds. We are also exploring the option of selling through doctors by showcasing Eve’s benefits,” shares Vistakula.
Dhama’s products for the hospitality industry include a heating plate for banquet services that ensures food remains hot. It is currently in the trial phase with ITC Maurya. The company’s products are priced between Rs. 650 – Rs. 40,000 but according to Vistakula, products in the most expensive range constitute a lesser percentage of the sales. “The idea was to price the products low to commoditise them. Considering the good traction we are noticing, we hope to scale quickly to reach critical sales volumes,” he adds.
There are many more industries that could make use of Dhama’s technology – packaging and food industries are the other two verticals Vistakula is keen on.
Slow and steady
In 2009, Reliance Venture Asset Management had invested in Dhama and the venture capital firm exited in March 2011 after two years. “The funding proved useful for us as it was utilised for our technology development. Reliance shares have now been purchased by family and close friends,” says Vistakula. But as Dhama is sustaining itself on internal accruals, he is not in a hurry to raise more investment. “We are growing organically so the growth is slow but steady. Once we establish our sales process and attain critical sales volumes, we will definitely look at more investment to scale up,” he adds.
The team currently consists of 17 members and some of its members work on the continuous process of technology development. The company has hired an external marketing agency to help with strategy, brand management and customer reach. Dhama is also looking at advertising on radio and in magazines.
Building a market
At present, Dhama has a 2,000 sq. ft. sufficient assembling unit in Hyderabad, where outsourced components are assembled onto the core technology. Though Dhama’s focus is mostly on Hyderabad, it hopes to look at Bengaluru in the next two months and then at New Delhi. Over time, Vistakula adds that the team has built a better understanding of marketing and its customers.
He also shares that there is an effort to enhance the in-house marketing team. Even as Dhama increases its brand’s presence, Vistakula admits that there isn’t much competition. “We are building the market for such products now; competition usually comes in where there is a more mature market,” he states.
About 80 per cent of the company’s costs are covered by its sales. While it is looking to breakeven this financial year, Vistakula hopes to generate Rs. 50 crore of revenue in three to four years. From a single jacket to a product portfolio of 12, this MIT’s Innovator of the Year 2010 hopes to introduce more such inventive products to solve common problems.
|Product portfolio of nine products in 2010||Product portfolio of 12 products in 2012|
|Usage in apparel and healthcare segments||Three new categories: pain management, corporate gifting and hospitality|
|Reliance Venture Asset Management invested in Dhama in 2009||Reliance exited the company in March 2011|
|Business model focussed on high value usage with a very small customer base||Business model focuses on low-cost products that are beneficial to the common man|
|Direct method of selling its products||Hired an external marketing agency to help with brand strategy and customer reach|