June 2024 | Athera's Odyssey: Unseen Trajectories
From building the world's largest matrimony website to the future of business, dive into this month's edition of Odyssey.
In this month’s edition of Athera’s Odyssey, we cover
Portfolio Perspectives: We explore how AI is changing the nature of customer experience to make businesses more cognitive with Clootrack co-founder Shameel Abdulla.
Athera Almanac: In this edition of Athera Antiportfolio we reflect on missing the opportunity to invest in Moonfrog Labs and what it taught us about the “founder factor”.
Ecosystem Stories: Murugavel Janakiraman recounts how getting laid off led him to build one of the few Indian internet companies to scale beyond India 1.0.
Pathways: This month in Pathways, we’ll take a break from “read” recommendations and go for a few “listen” recommendations.
Portfolio Perspectives: Clootrack, CX in the Age of AI
The Clootrack Origin Story
The Clootrack journey began with a simple vision: to create a new mobile app every 18 days. Co-founder Shameel Abdulla, fresh from a successful acquisition, set out to build a "factory-like model" for efficient app development.
This ambitious goal led him and his co-founder, Subbakrishna Rao, to mine online customer feedback for new app ideas. In doing so, they stumbled upon a far more significant opportunity. The team realized that the real value lay not in the apps, but in the customer insights they were gathering.
Recognizing that businesses across industries struggled to understand their customers in the digital age, Clootrack pivoted from app development to customer intelligence.
The transition took nearly two years of refinement, involving conversations with product managers at companies like Snapdeal and BookMyShow. What emerged was a sophisticated AI-powered platform for experience analytics – a tool providing over 150 enterprises with deep, actionable customer insights, and more from 10 billion+ customer conversations.
What follows is a lightly edited account of Shameel’s perspective on the evolving nature of business-customer interactions in the age of AI.
COVID-19 And the Acceleration of AI
The COVID-19 pandemic accelerated a seismic shift in customer behavior, propelling businesses into a predominantly digital landscape. As Shameel notes, “Suddenly businesses realized that they could not directly interact with the customer to understand them better. Since we already had in place the tech to understand customers through various forms of digital data, we were well positioned to provide a unique perspective."
This urgency catalyzed the adoption of AI-powered solutions from Clootrack, which could analyze vast amounts of customer data. For instance, Clootrack’s AI-powered sentiment analysis could detect subtle emotional nuances in text with up to 92% accuracy, allowing its users to gauge customer satisfaction in real time across millions of interactions.
Beyond the real-time nature of insights, Shameel explains that the AI edge also comes down to two factors: scale and speed.
He illustrates this with an example from the apparel industry, where return rates can reach up to 50%. While working with an apparel business Clootrack's AI identified that a small percentage of returns were due to defective products, exchange fraud, and mismatched sizes. The remaining returns were largely attributed to experience-related and communication issues, such as higher return rates of black-colored fabric since they were perceived to be thinner.
Micro insights such as these across thousands of SKUs allow retailers to proactively address them and increase their margins.
AI as the Cognitive Engine of Business
Clootrack's vision extends far beyond simple automation though. Shameel envisions a future where businesses become truly "cognitive" - not just in their offerings, but in their very ability to understand and respond to customer needs. This cognitive transformation manifests in three key areas:
Self-Healing Products and Services: Imagine a world where products can diagnose and address issues before customers even notice them. This proactive approach, reminiscent of erstwhile predictive maintenance in data centers, could revolutionize customer service across industries.
Hyper-Personalization: AI will enable businesses to tailor experiences with unprecedented precision. Shameel paints a vivid picture: "You walk into a textile shop and stand in front of the mirror, it will dress up with the best attire that will fit you."
Intelligent Engagement: AI will dramatically reduce spam by enabling highly targeted, relevant communications. As Shameel puts it, "Cognitive business will avoid spam to a great extent. It is a win-win for the customer and the business."
The Four-Stage Odyssey Of AI-Driven CX
In this process of evolution, Shameel outlines a clear path that every business adopting AI in customer experience will go through:
Exploration: Using AI to analyze customer feedback and identify patterns.
Automated Insights: AI proactively surfacing relevant insights without human prompting.
Recommendations: AI suggests specific actions based on insights and expert knowledge.
Orchestration: AI autonomously implementing changes and improvements.
Most businesses today are currently in stage 1 or 2, but Shameel believes the potential for transformation is immense.
Balancing Technology and Humanity
As AI capabilities grow exponentially, Shameel emphasizes the importance of finding the right balance between AI-driven efficiency and human empathy,
“The goal is not to replace human interaction but to enhance it, creating experiences that are both highly personalized and deeply empathetic.”
He advocates for a "crawl, walk, run" approach to AI integration, emphasizing the importance of finding the right AI partners and fostering a culture of continuous learning and adaptation, “By doing so, businesses can harness the full potential of AI to create customer experiences that are not just satisfactory, but truly transformative.”
The Next Frontier of AI in CX
Shameel's broader vision paints a picture of a world where AI doesn't just augment human capabilities—it fundamentally transforms how businesses understand and serve their customers. Concerning the future of CX, he is expecting businesses to not just be automated; but cognitive, predictive, and deeply personalized.
Shameel's has three wishes for the future:
Shameel and his team at Clootrack aim to leverage AI while being lean. This aligns with the growing AI in Customer Experience Market, expected to reach USD 76.7 Billion by 2033, up from USD 10.5 Billion in 2023, at a CAGR of 22.0%.
Shameel envisions AI transforming various sectors, from agriculture to manufacturing. He foresees AI-powered robots performing groundwork in farms and factories, while also prompting new ideas to decision-makers. This shift could fundamentally change how businesses operate and innovate across industries.
Shameel envisions a future where AI could help create a more idealistic, "utopian" scenario, providing basic services and freeing humans to pursue higher-level endeavors.
Shameel concludes by emphasizing, “The future of CX is not just about AI—it's about using AI to create more meaningful, empathetic, and effective interactions between businesses and their customers.”
As we stand on the brink of this AI revolution, one thing is clear: The symphony of the future will be conducted by AI, but its music will be profoundly human.
Athera’s Almanac: Moonfrog Labs (2015-2016)
As we delve into our new "Antiportfolio" series, where we share the stories of promising startups we missed out on investing in, the tale of Moonfrog Labs stands out as a pivotal lesson in investment strategy evolution and understanding startup potential.
In our previous edition, we recounted our experience with SEDEMAC, a deep-tech startup that taught us the importance of balancing risk assessment with innovation potential. The SEDEMAC chapter focused on recalibrating our risk appetite. The Moonfrog Labs story, however, underlines the need to adapt our investment thesis to the dynamic nature of startup ecosystems and founder archetypes that change with every new chapter of the startup age.
Moonfrog Labs: The Founder Factor, 2015-2016
The year was 2015, and the Indian startup scene was buzzing with energy and optimism. E-commerce giants like Flipkart and Snapdeal were making headlines, and investors were eagerly seeking out the next big thing.
Amidst this excitement, we came across Moonfrog Labs, a mobile gaming startup founded by a group of passionate entrepreneurs with a vision to build a world-class gaming studio in India.
Tanay Tayal and his team, with their proven consumer gaming pedigree from Zynga, presented a compelling case. They had already built and scaled Zynga's business in India and had deep domain experience in managing successful games like Bubble Safari, Empires & Allies, Castleville, Mafia Wars, and FarmVille.
Their thesis and approach were unique for the time. They believed that, with more mobile use, popular social games in India would also find mobile success. As with SEDEMAC, the team embodied everything we sought in founders: hunger, humility, and competence.
Unlike SEDEMAC, we didn't have to worry about regulatory implications, as Moonfrog Labs made it clear from the start that they would not venture into real money gaming or incentivize gambling.
Despite recognizing the team's strengths and their potential, we decided to pass on the opportunity. The primary reason was that Moonfrog Labs was a pre-revenue company. At the time, our investment thesis did not include pre-revenue companies, especially those in the idea or early development stage. Additionally, Moonfrog Labs was pre-launch, and the product was still in its nascent stages.
Since then, our thinking has evolved, and we now view pre-revenue and pre-launch companies through a different lens. Here’s how:
Founder Pedigree in Pre-Launch Companies: The pedigree of founders is crucial. We are now open to investing in pre-launch companies if the founders have deep domain experience. For example, the Moonfrog Labs team, being ex-Zynga, had managed some of the most successful games and knew how to build and scale gaming products.
Delayed Monetization for Network Effect Products: For certain product categories, especially games and other products with inherent network effects, it is acceptable to delay monetization. At small scales, monetization efforts may not be significant, but once these companies achieve scale, revenue grows exponentially.
Valuation and Investment Timing: If the product and monetization work, the valuation of these companies can grow significantly. This makes it challenging to invest at later stages like Series A. Hence, considering seed-stage investments for such categories is essential.
Capital Efficiency in Successful Games: Successful games generate substantial cash flow, leading to very capital-efficient business models.
How We Evolved After Missing Moonfrog Labs
Fast forward a few years and a pandemic later, Moonfrog Labs' games, such as Teen Patti Gold and Ludo Club, are now played by over 100 million players globally. The company also delivered a handsome return to its backers with one of India's biggest gaming exits to date.
As legendary investor Chris Sacca once said, "Being behind the curve on a big upcoming trend is a critical mistake." And that's precisely what we did with Moonfrog Labs. We underestimated the potential of pre-revenue, pre-launch companies led by experienced founders.
In hindsight, we realize we were overly cautious in our investment strategy. While managing risks is crucial, being less flexible can mean missing out on exceptional opportunities. The journey of Moonfrog Labs taught us to dream bigger about market potential and challenged our assumptions on adoption curves.
It taught us to dream bigger about market potential and challenged our assumptions on adoption curves. These insights gave us the conviction to take early bets on startups like Pixxel, which are pushing the boundaries in their respective domains.
We also learned the importance of relationships beyond a deal. Rutvik advised Tanay on raising funds as a first-time founder and while we missed the chance to partner with Moonfrog, Tanay remains a valued friend of the firm who has generously shared insights to help our investment strategy evolve. His journey with Moonfrog has been an inspiration, showcasing the immense potential of the Indian startup ecosystem.
Ecosystem Stories with Murugavel Janakiraman
From the suburbs of North Madras to the founder of India's leading matrimony platform with over 8 million members signing up to find their life partner every year, Murugavel Janakiraman's journey spans three global ‘Black Swan’ events, multiple setbacks, and the relentless pursuit of a grand vision: to be the gateway to happy marriages.
Born into a family of modest means, life’s circumstances shaped Murugavel’s early aspirations. As the first in his family to complete high school, his uncle advised him to pursue a degree in Chemistry and secure a job as a lab technician.
However, destiny had other plans. Despite his initial disappointment at being denied a seat in the Chemistry program because of low marks, Murugavel excelled in Statistics and later discovered his true calling in computer applications during his MCA program.
Murugavel eventually found his way to the United States, where his entrepreneurial journey began. He pursued his regular job during the day, and by night, he was building a website for the Tamil community in the US. The spark that truly set his entrepreneurial passion ablaze was the traction in the matrimony section of the website.
"When the matrimony section was getting some traffic and there were some success stories, that made me realize that Tamilians want to get married to other Tamilians," Murugavel recalls during our enlightening conversation. "So I thought, why not launch Tamil Matrimony, an exclusive matrimony service for Tamil people?"
Finding his future wife through the service he built was the ultimate proof of concept any founder could ask for.
In late 1999, however, fate promptly intervened, the dot-com bubble burst, and Murugavel found himself without a job. This setback pushed him to return to India and dedicate himself fully to building Matrimony.com, today a public company facilitating over 400,000 marriages in 2022 alone.
What follows is a candid conversation with Murugavel, as he shares insights into how Matrimony.com scaled beyond India 1.0, his wishes for the future, and some timeless insights he has gained through the years.
Disrupting Tradition with Trust
Athera: What were some of the early challenges you faced building a tech-enabled matrimonial platform in India?
Murugavel: In the early 2000s, when Matrimony.com was just starting, online payment gateways were not yet prevalent in India. So we became the first to offer a doorstep collection of payments. We are talking about a time much before credit card payments and online payment gateways.
This was part of a larger effort to build trust and credibility. We addressed this by becoming one of the first companies to validate every profile on its platform and introduce mandatory mobile number verification, a practice that is now standard across the industry.
Athera: As a first mover in this category, what was the most important early insight?
Murugavel: One of the key early insights that drove Matrimony.com's growth was the realization that marriage in India transcends language, even though it was a strong indicator of preference. People considered communities, jobs, and other factors.
So once we realized that marriage in India is not limited to language we launched over 300 community-based matrimony sites catering to various linguistic, religious, and special interest groups.
This localized approach, combined with strategic advertising on regional TV channels, helped Matrimony.com establish deep connections with communities across India.
Post the dot-com bubble, we were also able to negotiate with massive internet marketplaces like Rediff and Sify for traffic at competitive rates, which helped drive our initial adoption.
Cracking the Bharat Code
Athera: Can you elaborate on your efforts to serve the underserved segments of the market, particularly in tier 2 and tier 3 cities?
Murugavel:
Honestly, I don’t think we ever looked at it explicitly in that manner. We always thought of what our numbers and conversations with customers were telling us. I think a better way of looking at it is not as urban India (India 1.0) and the rest of India (India 2.0, 3.0, and so on) but to understand what are the unique needs of each socioeconomic group beyond just linguistic and regional preferences.
An example of how we went beyond just localizing its platform for regional languages is when we identified a significant segment of our potential customers were non-degree holders who were not comfortable with English, and therefore had been left out of the online matchmaking revolution.
To address this gap, we launched Jodii, an exclusive matchmaking service for non-degree holders in Indian languages. We understood the needs of this segment and designed a product specifically for them, bringing them into the fold of online matchmaking.
Matchmaking and Technology
Athera: How has Matrimony.com leveraged technology to enhance the matchmaking process and user experience over the years?
Murugavel: Over the years as Internet penetration increased and user preferences evolved, we continued to innovate and adapt, leveraging cutting-edge technologies to elevate the matchmaking experience. One key innovation was the incorporation of astrological matching, recognizing the cultural significance of astrology in the matchmaking process.
We also launched elite matrimony services and established offline kiosks at major airports like Hyderabad, Chennai, Bangalore, Delhi, and Mumbai to cater to the needs of affluent and high-net-worth individuals.
Navigating Societal Shifts
Athera: From your perspective, how has society changed, and how has Matrimony.com impacted or been impacted by these changes?
Murugavel: One of the most notable changes has been the transfer of decision-making power from parents to the younger generation. Parents were in the driver's seat a couple of decades ago. Now parents are in the passenger seat. It's largely youngsters who are driving the matchmaking agenda.
However, certain cultural norms have remained relatively unchanged, such as the preference for marriages within the same community. By and large, marriage within the community drives more than 90% of marriages.
Another shift is the increase in the average age of marriage. With every passing decade, the average age of people getting married increases because it correlates with the country's economic growth, female literacy and GDP growth as people become more aspirational.
But throughout these societal transformations, we still play a pivotal role in transforming online matchmaking from a last resort to the primary choice for finding a life partner. Matrimony.com was one of the last choices two decades ago. Today, we have become the primary choice of people to find a life partner.
The Future of Matchmaking
Athera: Do you foresee any changes ahead in how marriage as a concept will evolve? How is Matrimony.com preparing for these shifts?
Murugavel: I believe that the matchmaking industry, much like society itself, will continue to evolve to cater to emerging needs and preferences. One such shift is the increasing demand for platforms that cater to serious dating and premarital courtship, driven by evolving social norms and increasing individualism among millennials.
To address this need, we are gearing up to launch a platform designed to help users find meaningful relationships while respecting the cultural nuances of the Indian market. There is a growing segment of the population that wants to fall in love and explore before they commit themselves.
We also recognized the need to serve the LGBTQ+ community by launching a dedicated platform, reflecting the changing legal and social landscape around same-sex relationships in India.
Murugavel’s Wishlist
Athera: What are your top wishes for Matrimony.com and the Indian marriage market?
Murugavel:
Our prayer is that every member finds a good life partner and leads a happy married life, and that is hopefully through Matrimony.com.
We aim to expand beyond matchmaking into wedding services with platforms like mandap.com and weddingbazaar.com.
We hope to overcome the challenges posed by digital monopolies like Google, advocating for digital competition laws to ensure a fair market.
Parting Thoughts and Advice for Entrepreneurs
Athera: What advice would you give to founders and startups aiming to crack the code of building and scaling beyond India 1.0?
Murugavel: First and foremost you have to figure out how to reach non-customers of the category you operate in.
Not only that, you need to know how to serve them better than the current alternative. It could be a different product or a different offering. Pick up signals from the market, conduct research, and be open to adapting your offerings based on feedback.
One piece of wisdom I carry with me is a line from my spiritual guru, Mahatria, "Life is like a game of chess and you play this game with Him".
Many of the most important decisions in my life and career have been unintended but they also proved to be the most impactful. From choosing statistics and losing my job in 2000 to many other things along the way, I would have never taken this path if it were solely left to me. I believe you will never know what’s in store for you. The best you can do is commit wholeheartedly, reach as far as you can go, and see what lies ahead from there.
Athera: Finally, what are some books that have influenced you and you’d recommend?
Murugavel: I recommend ‘Blue Ocean Strategy,‘ ‘Lean Startup,’ The Miracle Morning,’ ‘Playing to Win: How Strategy Really Works,’ ‘Hacking Growth,’ and ‘Unposted Letter’ by Mahatria. These books have profoundly shaped my approach to entrepreneurship and personal growth.
Pathways
This month in Pathways, we’ll take a break from “read” recommendations and go for a few “listen” recommendations. As always, the intent is to suggest a path with a gradient. Below are three podcasts for you - but these are not the usual casual-conversational podcasts (which seem to be flooding our feeds now!). We love podcasts that are engaging, enthusing, food-for-curiosity, and designed upon storytelling prowess. Try these to be transported to different eras and exciting contexts, and you just might begin to feel like co-travelers of the protagonists. 🙂
A cozy podcast room, in the style of Monet - generated thanks to StableDiffusion3
Business Wars
If you like non-fiction, try Business Wars by Wondery. Business Wars publishes weekly episodes of 45 mins each in 4-5 episode arcs. Each arc covers the story of a key business battle - think, Marriott vs. Hilton, Pepsi vs. Coke, Tesla vs. Detroit, and more. Business Movers (also by Wondery) is an associated podcast that also publishes similar arcs, where each arc covers a key moment in a famous corporate story - think, “The Story of Cisco”, “Building Lego”, “The Exxon Crisis” and so on. The studio has done a fantastic job of top-notch narration, deep research, script writing, and a knack for choosing compelling stories of people and businesses that have precipitated inflection points in their domains.
Short History Of…
For those with a particular love for history, try “Short History Of…” by Noiser. Another studio that has done a fantastic job of dramatized storytelling, covering pivotal snippets from history. Their episodes, usually 45-55 mins each, cover a range of topics across empires, battles, monuments, historical figures, wars, and revolutions. They publish on Mondays; ideal for a bit of bedtime unwinding - and this author, a great cure for Monday blues!
Acquired
Top of our list is the “Acquired” podcast by Ben Gilbert and David Rosenthal. This is not dramatized - strictly speaking - but is still solid storytelling. That said, their strength is the extraordinarily deep research they put in, and how it is all stitched together with a lot of color and visualization. Each episode is 2-4 hours long, but if there is an audio equivalent of a “page-turner”, then this is it. The narrators pick a company and dive through its history - with great detail, a fast pace, and a spotlight on turning points - surfacing some of the most intriguing trivia in the process. If you’re looking for a place to start, they recently did a piece on Microsoft (and started with Bill Gates at school!).