Harsimran Julka
Moneycontrol
45-year old Policybazaar CEO Yashish Dahiya is a fitness freak. He can cycle for over a 100 kilometers and run over 50 kilometers at a stretch.
Son of an Army man from Haryana, Dahiya likens building a startup to running a marathon which many young startup CEOs have forgotten. He likes to conserve as much energy (read cash) early in the game, which has let Policybazaar survive the tumultuous times, even as others have shut down in this space.
He also likes to stay along with his employees whenever traveling outside the city for meetings. “We share rooms and also like to take the cheapest flight out,” he tells Moneycontrol.
In an exclusive interview, Dahiya shares his plans for an IPO in 2018 and how he managed to bring his startup to profits of over Rs 100 crore from losses of over Rs 200 crore in 2014.He also shares his tips for entrepreneurs struggling in a cash crunch environment.
Excerpts from an interview:
Q: As most startups are struggling with cash burn and losses, how Policybazaar became profitable?
A: About two years ago we were in losses of about Rs 100 crore annually, which was significant loss and our total revenue was about Rs 100 crore. So from that to Rs 200 crore revenue and that was significantly profitable.
We cut out all the activities which were not adding value especially, on the technology front.
We decided to return to the core and it was to sell insurance for health, life, motor, travel, critical illness, etc.
Because the core was 100 percent of the revenue, the revenue rose from Rs 100 crore to Rs 200 crore. The losses came down from Rs 100 to 80 crore. Next year, we are looking forward to Rs 300-350 crore revenue.
Q: What are the IPO plans for Policybazaar? Will you list on an Indian stock exchange?
A: Hopefully, we will be IPO ready by March, 2018 and may go for and IPO around September-October, 2018.
But being IPO ready and going for an IPO are two different things. If we want to go for an IPO, it would be eventually easier to do it on the Indian stock market. So we don't know, we are still looking at options.
Q: How you manage your own insurance?
A: I am in a very very special situation as my whole family lives in UK so effectively I have a permanent residency their and UK has health insurance etc. So, my requirement for insurance is quiet low and as I’ve invested early so I’m an asset wealthy compared to my family needs. I do have an accident cover and a critical illness cover but not a lot of other insurances. Ideally, I should have a health insurance and i should have a very significant life insurance.The need of life insurance becomes less when you are very asset wealthy so if your home is paid for, you have a very large bank balance compared to your needs, than you don't need insurance.
Q: What are your tips for for people who want to buy a health, home, motor or life cover? How should people approach the subject of insurance with respect to their own finances?
A: I think insurance is for those things which we can't manage. So that's how people should think, what all can happen in their lives which they may not be able to financially manage whether its death, disability or disease and have cover insurance for those and not to confuse insurance with investment, those are two different purposes, you can have pension plans and child plans which have lot of insurance from a tax perspective, that's a very different way of thinking about it. You have to think are you doing it for an investment or for insurance and you should have one primary purpose.
Q: How has demonetisation impacted your business?
A: We are growing fast and demonetisation didn't have much impact. For the first one or two days of demonetisation announcement we lost about 20 percent of our business but we were back within a week but we've not seen like a double in terms of business. It's been on plan and that's it nothing special.
Q: How do you equate running a triathlon with building a startup? Are there any similarities in between building your company and running a marathon?
A: I have done the 'Iron Man Triathlon'. I think there are a lot of similarities with building a startup in the sense you know you have to plan out a bit. In the Iron Man Triathlon you swim for 4 km, you cycle for 112 km and then run 42 km.
The point is if you swim too hard, you want be able to cycle and if you cycle too hard you won't be able to run. So you have to conserve your energies. If you look at policybazaar, from day one how it has conserved its capital and resources, kept at it, it doesn't mean you have stopped, it doesn't mean you are resting. You are working but you are working in a manner that your plan B, plan C everything is there and your goal is to finish not to just run. The goal is to finish in good time that's why the company turns profitable. I believe we are one of the first startups in the internet ecosystem which has turned profitable and fully profitable not profitable at x level or y level. But actually putting money in the bank every year now.
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