Not too long ago, Naveen Tewari and his friends, Abhay Singhal and Amit Gupta, shared a single bedroom apartment tucked away in one of Mumbai’s crowded corners. It was here that a company was born, one that is now set to challenge some of the biggest companies operating in the Internet space.
In 2007, Tewari and his co-founders established mKhoj with the idea of using mobile phones as search engines. Soon, the team realised that India was a place where the human network was capable of providing customised search results, perhaps a reason why most people still prefer to ask for directions on the road instead of using a GPS system. In a month, mKhoj’s business idea changed from mobile searches to mobile advertising. “We knew we were close to something interesting, but, we were not yet there,” says Tewari, who currently serves as chief executive. In another four months, mKhoj made another change, this time to tap into the mobile Internet advertising market. Having found its niche, the company decided to change names as well. Thus, was born InMobi. Today, the Bengaluru-based company has made its presence felt in 108 countries with nearly 17 billion monthly impressions combined on its mobile websites and applications.
“Advertising is about grabbing eyeballs and reaching out to the largest audience and in the future, mobile phones will emerge as the medium with the widest reach,” says Tewari. According to Tewari, InMobi’s revenue model is similar to that of newspapers where advertising forms a chunk of revenues. “We play the role of an intermediary between mobile websites and advertisers, by helping the advertiser locate the right site to publish his advertisement,” says Tewari. This entire process is technology led, he adds.
For the last three years, InMobi has focused on the growth in the developing markets of Asia and Africa. Asia alone accounts for 10 billion of InMobi’s advertising impressions with Africa contributing another 2.3 billion. The company is keen on leveraging from the growing curiosity about the Internet in these markets. Yet, with India’s Internet penetration being a mere 6.9 per cent, some might see this as a significant challenge to InMobi’s growth plans. Tewari and his team see otherwise. “The developing markets present growth opportunities that are phenomenal, unlike the advanced market,” says Tewari. He adds that several consumers in the developing regions are first time users of the Internet and the excitement that digital media brings will lead to repeat usage.
In addition to the developing markets, InMobi aims at getting a foothold in the mature markets of Europe, U.S. and Japan. It has been in operation in the U.S. since mid-January, 2010 and has already managed to garner advertising impressions of close to two billion. A launch in Japan is on the cards. Tewari expresses confidence in being able to face the challenge of delivering to a demanding consumer in a competitive environment. “The key difference between consumers in the developing market and advanced markets is the level of sophistication. Since a majority of the consumers in these regions have been exposed to digital media for over a decade, their understanding of the media is far more evolved,” says Tewari. The company is in the phase of expansion in the U.S. and over the next year, it seeks to delve deeper into the market.
Founders: Naveen Tewari, Abhay Singhal, Amit Gupta
Industry: Mobile Advertising, Technology
USP: With 17 million advertising impressions, InMobi is second only to Google’s AdMob and with their global expansion plans in place, they take the position of a worthy challenger
While going global brings the company into the limelight, it also brings them face-to-face with competition. And when competition includes technology giants such as Google and Apple, the going is bound to get tough. When asked if there are any special measures taken to counter Google’s AdMob, Tewari replies in the negative. “Competition is good, it keeps everybody attentive, but, we are banking on the growing reach of our medium as opposed to feeling threatened by big players,” says Tewari. By 2015, he predicts mobile Internet users to have reached close to five billion. “We are excited to be a part of an industry that is poised for such phenomenal growth. How well we do in this space depends on our execution,” states Tewari.
Right from the start, InMobi’s founders were passionate about their offering. In 2006, angel investment network, Mumbai Angels, led by Sasha Mirchandani, backed their passion with an initial round of funding to the tune of U.S. $ 500,000. By the time the team built its product prototype, it had run out of money. “All of us made some sacrifices and decided to invest our personal capital in the venture and this brought us closer as a team,” says Tewari. The product was rolled out with limited resources. By mid-2008, InMobi received its second round of funding from U.S. based venture capitalists, Kleiner, Perkins, Caufield & Byers and Indian capital firm, Sherpalo Ventures.
In his opinion, procuring funding proved to be easier than finding a team that was as passionate as the founders. “Initially, when we had not yet established a brand name and had no product to show for, finding people who believed in our vision for the company was difficult,” says Tewari. However, InMobi persisted with its hiring process and managed to find people whose belief in them was immense. “When you hire people whose belief outweighs their skill, you do not face issues of retention,” says Tewari. In today’s context, Tewari claims that hiring bar has been set high. “Irrespective of the position, all those who are hired are interviewed by me,” he states. He firmly believes that maintaining these standards has helped InMobi attract the best talent. What keeps this talent at InMobi is the work culture. Tewari insists on a flat organisation structure, doing away with hierarchy. “Nobody at the office, including me, has a cabin. We all have cubicles and this makes everyone accessible,” he says.
With the right team in place, InMobi has taken rapid strides forward. In the coming times, InMobi seeks to consolidate its position as market leaders in Asia and Africa and pose a tough fight to the bigger players in the advanced markets. As for the debate on popularity between mobile applications and websites, Tewari thinks the tide will remain in favour of websites. “Either way, we do not mind whichever direction things head in, we are strong in both,” he adds. Tewari outlines InMobi’s vision for the future with great clarity – to become the first Indian Internet Company to have truly made it big. At the going rate, that day of reckoning is not far.