Harshvardhan Roongta had an illustrious career as a corporate banker with ICICI and was actively involved in establishing their retail lending division. Till date, he remains extremely indebted to his former employer for the freedom they gave him and the goodwill he generated while working there. Yet, he always had the yearning to be an entrepreneur. “Everybody has a Eureka moment that they usually let pass. I always wanted to do something on my own,” explains Roongta. And he did. He is now the founder of Mumbai-based Apnapaisa, a price and feature comparison service provider on financial products.
The entrepreneurial bug bit Roongta twice, the first stint began in 1990 when he co-founded a boutique investment banking firm. However, scalability of this venture posed a challenge and he returned to the lure of banking in 1998. The second stint resulted in the creation of Apnaloan in 2000, with the help of two of his former colleagues. Amongst those who invested in Apnaloan were Rediff, ING Vysya Bank and SIDBI Ventures. Apnaloan went on to become one of India’s largest distributors of home loans and credit cards. Perhaps, a reason for its success was the priority given to the consumer as opposed to the lender.
In 2007, Apnaloan made way for a new company, Apnapaisa. The new company bought over the brand name of ‘Apnaloan’, while selling the delivery model to a bank. The business model changed from one based on distribution and delivery to one based on providing financial comparisons. Speaking on what prompted the change, Roongta says, “Scalability of the distribution business is a big issue. Employee turnover, training, sales commitments, these were some reasons which made it very difficult to control an offline process.” Another issue was garnering support from banks and insurers as the model was multi-bank, multi-insurer. “The moment a bank or insurer supports you, you need to sell their products,” says Roongta.
“The Internet revolution allowed expertise to be shared among people in a cost-effective manner and that was the turning point”
Drawing from his personal experiences of people constantly asking for his expert advice, Roongta realised that there was always a need for this expertise to be communicated. “The Internet revolution allowed expertise to be shared among people in a cost-effective manner and that was the turning point,” says Roongta. The newer model has found a definite connect with the consumer, as today, Apnapaisa’s website receives close to 20,000 unique visitors in a day. And Roongta wants to keep this number growing. “In two and a half years, we would like to hit 1.50 lakh visitors a day,” he says. The visitors have a range of financial products and services to make a comparison, including home loans, business loans, health insurance, mutual funds and pension plans amongst others. The comparison quotes are provided in a user-friendly manner that makes the website a one-stop research destination for those that are on the brink of purchase.
Furthering the promise
At present, close to 60 per cent of Apnapaisa’s revenue comes from cross-referrals to insurers, financial organisations and banks with website advertisements also making a contribution. Roongta intends to further the referral model to one of online fulfillment for sale of several financial products and services. “To me, one big item that is still not there is the money that we will make per sales completion,” asserts Roongta. So, what then stands in the way? “One reason we have held back in this regard is because our advertisers, whether it is an insurance company or a lender, do not have online systems that can give us feedback as to what happened. Therefore, we are never sure of what revenue we generate. So, we want to cut off at a point where we have control,” says Roongta. He goes on to add that this process necessitates that the advertiser maintain a buffer for the risk undertaken for those referrals that do not turn into sales. In essence, Apnapaisa still remains on the marketing budgets of its advertising clients. “Today, online has especially taken hold in insurance (non-life insurance), where online closures and telephone assisted closures are beginning to happen. This will allow us to know what happened to the customers we refer to our clients and that gives us clients with unlimited appetites because we become a part of their sales budgets,” predicts Roongta.
One of the other avenues to grow the company’s business was through expanding their data comparisons to include mobile phones and mobile service providers. “There is a gap that exists in the mobile phone space and there is not much information on comparisons between service providers and their plans,” says Roongta.
While Roongta has a clear picture of what he would like the future to be, he has faced a few challenges along the way. “The biggest challenge remains by far, people,” says Roongta. “Getting people whose opinion you want to listen to and getting that quality of people to be as excited as I am about helping consumers make informed decisions and retaining them is the key,” he adds. On people retention, Roongta opines that making them feel their thoughts and actions help shape the company, goes a long way. “I think most people will be willing to trade 30 to 40 per cent of their salaries for that kind of an involvement,” he says.
Another significant challenge for ApnaPaisa was the updation of information provided to consumers. Roongta states that at present, updation of data happens on a weekly basis, but, if a major player were to change rates, the updation would take place on the very same day. When asked about the process of updation, Roongta quips; “That’s our commercial recipe for success.” He goes on to add, “Unlike many places in the world where financial information is required to be statutorily available, in India, what is available is not good enough for us.”
Getting money proved to be the simplest. Roongta says; “I have been blessed as I never found raising money to be a problem.” Roongta puts it simply; “If you have the right idea, the right people you will be able to raise money.” In early 2007, Sequoia Capital invested U.S. $2.2 million in ApnaPaisa. In 2009, Apnapaisa completed its second round of funding that involved existing investors, Sequoia Capital and JAFCO Asia. The expertise that Apnapaisa’s investors brought on board has proven to be extremely useful to the company. As Roongta states, he and the company share a superb working equation with its investors.
At present, close to 60 per cent of Apnapaisa’s revenue comes from cross-referrals to insurers, financial organisations and banks. Roongta intends to further the referral model to one of online fulfillment for sale of several financial products and services.
Looking to the future, Roongta foresees huge growth potential for the basic market that Apnapaisa is engaged in. He remains confident that Apnapaisa can attract a larger market share as and when that growth takes place. As for words of wisdom to budding entrepreneurs, Roongta urges them to have the courage to look beyond initial rejection. “It is better to have been an entrepreneur and to have failed than to have never been an entrepreneur,” he says as he signs off.