Pune’s too expensive, outsource to Nashik – Interview of Sushrut Bidwai (StartupForStartups)
Nashik based StartupForStartups (SFS) is marketing itself as a “facility to help early stage companies with limited resources to build first cut of the product (V0.5/V1.0)”. Founder Sushrut Bidwai is a regular fixture at Pune startup events, and is trying to convince Pune-based startups to outsource work to his programmers in Nashik, promising that it will be cheaper than doing it themselves. PuneTech interviewed Sushrut to get a first-hand take on SFS’ value proposition.
Can you give an overview of StartupForStartups?
Many times people have good ideas, but dont have guts OR are shouldering family responsibilities, which does not allow them to pursue these ideas further. In some cases none of the founding team members are from tech background, so even getting a good CTO is difficult for them (salary wise as well skill wise) . StartupForStartups (SFS for short) is meant for such teams. Its better to have something ready before taking the risk of quitting (high paying) jobs. It gives you more insight into product you are building as well domain you are targeting.
What SFS does is, it provides you resources required to build that beta version which you will show to investors (if its a big product) or will launch to limited audience and see how market reacts to it. After having this beta ready and some reactions from market or investors it becomes easier to take the risk and pursue it further full time.
Why are you doing this in Nashik? I would have thought that being in Pune or Bangalore (near all the startups, who are your customers) would make more sense for you?
Problems with Pune and Banglore are operational costs and resource costs. Also Nasik will have lower attrition rates and keeping people happy is easier. With technologies pushing the boundaries, we have so many tools available which makes working in distributed teams far easier. We even can do pair programming with two people sitting 5000 miles away from each other using WebEx/dimdim/Skype. Also it provides lot of cost advantages to startups we are working with.
As a customer, one of the worries I would have with StartupForStartups, is the availability of quality talent in Nashik. How are you tackling this?
We have developed a unique training program called “Implementing Concepts” which all our engineers go through before joining any startup team. So even if a particular engineer has gone through it once for a particular project, he/she will go through it again using the technologies which are going to be used in new project. This kind of a very elaborate HelloWorld for a project. Also, my experience in working on tech products is 80% of work is trivial and 20% is core work which is complex. So even if a startup is working on a product which is complex, they can take help of our resource in rest of 80% work. Though this does not mean we do not have expertise to take up complex work, it just means we are flexible and are okay with working as part of larger team. Also this is not outsourcing model, it is collaboration model. So you know who is working on your product and what that persons skills are and you can choose from the pool available. Also, to keep high availability of quality talent we are in process of collaborating with colleges here in Nasik. In this we will take the training program to colleges and have students go through them while working on final year projects. Please note that we do not assign interns on the projects.
Considering that most of your customers are early-stage startups who are strapped for cash, how do you plan on charging them for your services?
Charging is transparent. We send details about salaries we are paying to engineers assgined assigned to work on a particular startup and plus typically 20% operational costs. Now if you consider Nasik and typical salaries engineers expect and are more than happy with are much lesser than in Pune/Banglore. We already have the infrastructure and are building team. We are planning to build a team of 12-15 people by Dec end.
Could you give us an idea of what kind of savings I can expect compared to outsourcing to a company in Pune? (Where are the savings coming from: lower salaries, or other factors too?)
Lower costs for resources.
Lower operational costs. Just to give you indicator of savings, an Entry level GWT/J2EE programmer will draw salaries in the range of 17-22K in Pune/Banglore same programmer if he/she is from Nasik will be more than content to work on a good startup team if given around 9-10K salary. Plus you have to keep him/her happy so there is no attrition. Spend money on infrastructure like office space/ furniture/ hardware/ software / electricity / lunch facilities and many non-tangible costs like FBTs/Mediclaim facilities etc etc. you save these costs by almost 70%.
What do you see as your key competencies?
- Experience of working in large scale product companies as well as early stage startups.
- Top management has excellent problems solving and product designing skills.
- Understand working on an Idea and processes involved in the same.
- We are young, enthu, full of energy and love working on good ideas. (This is probably the most important quality.)
In the context of StartupForStartups, I’ve heard you talk about having a startup ecosystem. Can you elaborate on that?
This eco system is for people who are still in jobs and want pursue ideas. Though part of it can be used by full time entrepreneurs.
- We are signing an MoU with a financial and legal service provider company having experienced in handling these services for startups.
- We are creating pool of consultants (Architects, Performance engineering, Marketing/Advertising, HR, Viral Video creators etc).
- We are collaborating with engineering colleges here in Nasik. We have designed an unique training program “Implementing Concepts” which is focused on training engineering students with latest technology and early stage product engineering.
- We are talking to people who have the expertise of providing mentoring to early stage companies even before product is built OR evolved. Though we are in early stages of discussions with these people, but hopefully it will happen.
- We are building a tool (looking to raise funds for this tool) which is designed around a process called Super-Agile, which I will be publishing shortly. This tool and process are targeted for early stage product development. The tool will make writing code almost a trivial thing and even non-tech background people after a little training can build the products first cut on their own.
- Network. Not all startup founders are well connected. It takes lot of time to connect with people who can provide you help in building the startup. We can help there by connecting you with people we know, so its some starting point.
- Knowledge-base. Startup entrepreneurs does not have time to go through lengthy tax stuff etc. Or does not have time to design their documents like Offer letters, seperation letters, NDAs. Over a period of time we will collect such documents and put them in an inventory. This inventory can be very valuable to startups.
Note that all the services mentioned above does not necessarily come with a price tag. Some are out of goodwill some are for money . Our main problem is we are young, have the skillsets necessary to pursue an idea and make it to successful business. But we do not have the idea. So we want to work with people who do have it.
For those interested in meeting, Sushrut is in Pune today (25th September 2008) and is likely to attend the CSI Pune Seminar on Entrepreneurship. I know that there are a bunch of PuneTech readers who have an idea for a startup but haven’t made much progress yet because they haven’t been able to quit their job and take the plunge. If you are one of those, would you be willing to outsource some of this development to StartupForStartups or a similar company? Do you think this model will work? Let us know in the comments section below.
- StartupForStartups website
- StartupForStartups: Now trade your equity for product development – from WATBlog
- Follow sushrutbidwai on twitter