Thursday, 24 May 2007

Life After IPO - I

Apologies for the gap in posting. We just returned from a long trip overseas meeting investors and updating them on our financial results for the previous year.

Barnstorming twelve cities in five countries across three continents in 15 days has left me clueless about which time zone I am in and consequentially am wide awake as I write this blog at 3AM.

I think I am one of those people who get badly affected by jet lag. Frankly I don’t know how people do this for a living. I had thought life was supposed to get simpler after the IPO process was over.

Although I must admit we got into this with our eyes open. People older and wiser than I had told me before the IPO that a lot of time and effort would have to go into investor relations on an ongoing basis, we would be under a very public microscope, we would be riding a tiger etc. etc.

Well actually the benefits of doing a successful IPO far outweigh the occupational hazards. Going public has put us in a different strategic space altogether. We’ve got cash in the bank, our stock has currency, employees have seen the value of the ESOP, we are finding it easier to attract quality talent, the VC investors got liquidity, we can take larger bets, we are insulated against a downturn, it’s great for branding, we have unlocked shareholder value and so on.

On the flip side – our numbers are public. Competition knows more about us than we about them.

We were happy with our results and also with the numbers Rediff posted. I called Joy to compare notes and SMSed Ajit to congratulate him. The Rediff turnaround is great for the industry as it validates the confidence that investors have placed once again on the Internet in India. For a company that once traded at under a dollar on NASDAQ, the bounce back makes a great story.

The best part about meeting investors is that the smart ones challenge you with their questions and thereby force you to think in strategic directions that you otherwise may not have. At least some of our good ideas in the last year have come about as an unintended consequence of probing by investors.

One area that every investor we met on this trip asked us about was the penetration of the Internet in India. So how many internet users does India have actually? Is the estimate for usage in Cyber CafĂ©’s real? Why do estimates of Internet users in India vary so much? What’s happening on the Broadband front? What about wireless? How fast will Internet penetration grow? What’s happening on usage on the mobile? How many years behind China is India on penetration? How low will PC prices go? When will usage go beyond the big cities in a meaningful manner? How significant is home usage?

I wish I knew the answers.

12 comments:

Anonymous said...

Any thoughts on - the next company that will go public from Indian dotcom industry?

Kushan Mitra said...

Great to see that you're Blogging!

Shrenik said...

Hello Sanjeev !

Congratulations on a great quarter.

Sometimes, it is worthwhile segmenting the investor base in a sensible manner and letting your CFO (or even an IR Specialist) take some of the investor meetings. That way you only take fewer more important meetings.

Most investors are intensely curious to understand whats really going on in the Indian internet world. Understandably that will cause you an overload ! The business is a rapidly evolving one and investors might ultimately be served better by letting you focus on the business rather than on back-breaking travel !


We do this many times in our business of investment banking. Happy to exchange more learnings offline if it helps !

Cheers,

S


Shrenik M Khasgiwala
Director
Enam Securities Europe Ltd
shrenik@enam.com

Harmanpreet Singh said...

Waiting eagerly for Life after IPO - II. Do you feel the pressure of showing good quarterly numbers. I mean has your thinkingt changed as to how targets for revenues, margins should move (or smoothed)

Anonymous said...

Hi Mr. sanjeev,

It's very nice to see that the company is doing so good and I congratulate you on your success... I would like to take your attention to the line where you have said "we are finding it easier to attract quality talent"...but just wanted to know if naukri is able to retain their talent? I guess to know the answer you will have to dig deeper in your branches and check the emplyoee satisfation level.
- A well wisher

sumit4all said...

I am just left puzzling with one issue with this naukri thing, what are you doing to tackle the issue of fake CVs, what stops people from making 10 CVs of their own, do u have any steps in place

coolbuddy said...

This is amit from www.coolbuddy.com
I hope u know abt us.If not ,I let u know that we do 300k uniques in a day and myself have been following your success quite closely.Infact I have been comparing myself to yourself and have kept u as my benchmark.
And I must tell u that you have been so successfull that its been hard to keep up with your growth.
More abt myself later,I hope to get a reply on this.I will keep hiting this blog in future.

amit sinha said...

well, good to see you blog. hopefully it won't follow your golfing benchmark.
i guess investor servicing will turn out to be a very rewardng experience personally and professionally. good luck

Anonymous said...

Did u keep your company's name 'N aukri.com' bcoz, as you made clear you got provided initial financing by your wife's job at 'N estle'? N.

Of course, there could have been better names, but they wouldnt have been so base & yet successful.

congrats, anyway.

Anonymous said...

after JOB, MARRIAGE, PROPERTY COMPANYS, will you rise out of basics and go on to better options, like a MUSIC COMPANY?

Anonymous said...

DO U DO ANY CSR (corporate social responsibility)? Havent heard anything like that coming from your company's end?

It is quite a MOD thing, you know.

Anonymous said...

Hi Bikhchandar,

u seem to believe a lot in the invisible hand. hope the invisible hand works great for your company too.

regards.