You started Naukri.com sometime in 1996. It was a time when the Internet was pretty nascent in India. Can you take us through the early stages?
First of all, when we started, we just thought it was a small idea. Our thought process was simple. If we could get 1,000 companies to post one job per month, and pay Rs. 500 per job posting we would make Rs. 60 Lakhs a year. And, we would probably be profitable. For the first 6 months we were a completely free site. After about 6 months we started charging companies Rs. 650 per job posting or an annual package of Rs. 6,000 for unlimited job postings every year. We made Rs. 2.5 lakh in our first year. Next year, we made Rs. 18 lakh, and that’s when we realised this was something we could really grow. Over the next three years we rolled out interesting features and products, expanded our sales team and raised venture capital funding. After which we opted for an initial public offering in October 2006. Today, 35,000 companies use naukri.com, our database has 20 million resumes and 12,000 resumes are being added daily. We are the market leaders with a 63 per cent traffic share.
Recently, Info Edge has started firstnaukri.com targeted at freshers. What problem are you trying to solve with firstnaukri.com?
Fundamentally, it’s very difficult to analyse a fresher’s ability from just his resume. Our major differentiation is in the kind of data we gather in our registration form. We ask for very specific, granular information. For example, freshers have to fill up their scores, listed by subject in classes 10 and 12 and their undergraduate study. We gather information like one’s rank in class and size of the class. We also ask them to upload jpegs of certificates. With all this information, we enable a handshake between a student and a recruiter. Just as an example, a company can filter the database for resumes of all students who scored more than 80 per cent in mathematics amongst 30 different engineering colleges within a particular radius. We basically create a more efficient shortlist for them. And this is made possible by the kind of information we gather through the website.
Beyond the top 30-50 colleges in India quality of students becomes patchy. Even companies like Infosys, which hire a large number of people from campuses, visit only the top 300 colleges in the country. That’s less than 10 per cent of all the colleges in India. There’s a long tail of companies and colleges who could find our service very useful for hiring in this space.
How did naukri.com handle the recent recession? What lessons have you learnt from it?
We were definitely impacted. But, I think our competition got murdered. I think what naukri.com did right was that we continued to invest in the right areas even during the slump. We built our sales force, invested in technology, released new features and the result was that our customers were happy. The thing is, most companies in India use several job sites, but, I think what worked to our advantage was that we were the first choice for many and hence, the last to get cut if the need arose. We continued to grow in terms of product and service quality and that saw us through.
Though naukri.com is really successful, it seems like the other ventures within Info Edge are struggling to take off. How are 99acres.com(the real-estate portal) and jeevansathi.com (the matrimonial portal) doing in terms of revenues?
What we need to understand here is that 99acres and jeevansathi are still very young. Both these businesses show a lot of promise. If we were to compare the first three years of naukri.com with 99acres.com, the latter has got off to a much better start. We made Rs. 12 crore in the third year of operations at 99acres.com, while we made Rs. 36 lakhs at naukri.com. Of course, the time periods were different, but, that’s just to give you an idea. Real-estate transactions are very complex. What we do (with 99acres) is pretty much enable the handshake. We’re working on cutting down the spam and junk real estate listings and improving the quality of listings. With respect to jeevansathi.com, we just turned profitable. The market in this space is clearly segmented. BharatMatrimony.com is very strong in south India, Shaadi.com among non-south Indian NRIs, Gujarathis and Punjabis. Jeevansathi.com is doing very well in the Hindi-speaking belt in Maharashtra. We made Rs. 16 crore last year and we’re growing.
Info Edge seems to be betting big on online-education and educational classifieds. You made an investment in meritnation.com, which is an e-learning portal. There’s also shiksha.com. What are your plans in this space?
With respect to meritnation.com it’s an e-learning portal where there is curriculum in place for students in middle and high school and people go online to study. Info Edge made an investment in meritnation.com and it has nothing to do with our plans for shiksha.com.
On the other hand, shiksha.com is an educational classified site. We connect educational institutions with prospective students. The idea behind this is simple. Educational institutions are the single largest category in print advertising. Last year advertising spends in this category were Rs. 1,200 crores. It’s recession proof and the sector is growing fast. Even if we’re able to capture 10 per cent of theprint ad spends, it’ll be big. That’s what we’re working on.
Most successful web companies in India seem to be focused on a pay-for-services model? The advertising-driven model, which is successful in the west, has still not taken of India. Your thoughts?
The biggest problem if your web property relies on advertising is you’ll be competing with giants like Google.com. And, that is real tough competition. Obviously, the other problem is digital advertising is something that is still evolving in India.
What are your thoughts on Web 2.0 and social networking? Over the last year, a lot of recruiting seems to be happening through Linkedin.com. Do you think the jobs industry is going to face competition from websites like Linkedin.com?
The main problem with a website like Linkedin.com is you don’t know the intent of the guy. If a recruiter calls hundred people, probably two people will be interested in finding a job. At naukri.com, the intent is clear and that makes the process more efficient.
What advice would you give budding entrepreneurs who are looking at starting up in the Internet space?
Solve an unsolved problem and make sure there is clarity in business and revenue models. Clear understanding of your target market is crucial for success.