💡 Founder Spotlight: Nikunj Verma

Hello and welcome to Cloudflare TV. I'm your host João Tomé. I'm content writer at Cloudflare and welcome to Founder Spotlight where we shine the spotlight on the stories of startup founders all over the world. Today we have the founder of CutShort, Nikunj Verma. Thank you for coming on our show. You're live from near Bombay, India, right? Yes, I'm in Pune. Thanks for having me here and it's a great day here. So we want to know a little bit more about your startup, CutShort. It's a short name. So what does your startup do really? So basically if you ask most of the companies out there today, I'm sure in the audience a lot of people in tech and there are also a lot of people who are thinking of doing their startups, already working in startups. One of the major pain points that companies and startups have today is tech talent, right? How do you hire people who can build products, who can thrive in your company and how do you find those people? So we solve that problem for the companies. CutShort as the name suggests was started to dramatically solve the problem in a very innovative manner. So we have a marketplace where companies can find the right people, you know, on a lot of parameters that they are looking for without really having to search people and all of that. So that is a problem we are solving for a lot of companies and a lot of talent as well. So we have around 1.7, 1.8 million users in India and we have around 18,000 companies that have used the product so far. So yeah, that is a problem we are solving. Your company was founded in 2015, right? Correct. In terms of the slogan that you use to explain your company, it is, of course, I was checking your website and it is kind of interesting. You do not define yourself as a job board and it is not completely like LinkedIn because it does not have the social network, right? But it has a little bit of those two, right? It is a networking platform to find the right professionals. More focus on AI, right? Correct. Yeah, so that is interesting and I think you have a great eye that you were able to decipher the entire messaging on the website. But basically, if you look at how people progress in their careers today, fundamentally nothing has changed in the last 10-15 years. LinkedIn is the only platform where you can find other professionals, network with them, share ideas with them. And then there is also a job part which actually is a big use case that people use LinkedIn for. But then the approach that is required today in terms of the changes that have happened in the world around us, right? In terms of the skill sets have changed, in terms of the preferences of people have changed, now COVID has completely changed everything. People are hiring remote, people are working remote, people are retiring early, people are taking sabbaticals, people are not going to formal schools. All of that stuff is changing and the whole professional world, the way we knew it has completely changed in the last 10-15 years. And it's going to further accelerate, it's going to become more skill-oriented, education is going to become, formal education is going to become less important. So all of that needs to be consumed and solved in a different way. LinkedIn is great, it has this one implementation where you can connect with people, build a network and find jobs. But what we are doing is taking a different approach to it in terms of not just matching based on the hard skills and what is there in the resume, but also based on the preferences, your career goals, and trying to see if we can connect companies with the people who are just looking for the companies like them. So a lot of stuff can be done here in terms of now looking at this from a totally different perspective. So yep, I think there is a lot of overlap with LinkedIn as well, but there's a lot of different stuff as well in terms of our solution. You told more than 1 million users you have in India. In terms of the usage that those users take from your platform, how can you define it in terms of looking for talent and joining companies with talent, how do you define that process where you help them? You mean what is the process like for them when they're looking? Exactly, when they hire, when they enter your platform, how is the process for them to find what they're looking for? So it's completely self-service platform. They sign up on the website. They fill a few details. A few details we take from the resume. We try to understand their resume and similar stuff we do on the other side. When companies come in, we analyze and look at their job descriptions. We help them understand the talent pool they're looking for because a lot of times the market is very dynamic and recruiters and companies have very limited insights into the data about what kind of skill sets are in demand, how many people like this exist in the market, what kind of salaries they're already drawing, what are the preferences they're looking for. So all of this data also is something that they don't have access to because of which they make a lot of suboptimal decisions in terms of salary they are offering for their jobs, the kind of choices they're keeping in terms of remote work and all of that. So we try to guide them towards it that okay, if you target these kind of people, if you want to target this kind of talent, then this is what we will suggest you based on the data that we have. So there's a process nudging happening on both sides to ensure that these people are able to see each other and the outcomes are maximized. And then the matching process starts. Algorithms help people discover each other based on the roles that they are in. And then we have complete tools and other SaaS layer built on top of the marketplace where companies can look at these candidates further, ask them screening questions, audio questions, video questions to understand them better and completely understand each other and transact with each other with notifications on things like WhatsApp and all of that so that the process moves faster. The end result is that what it used to take once two companies to hire, they are able to close in two days, three days. And that is pretty significant in terms of the efficiency and the speed that they have been able to accomplish. That's interesting. In terms of how far along you are on your startup adventure, you told us the number of clients you have in India, but for example, employees and also funding milestones that you have already. Yeah. So I think in terms of the milestones, I would say the first milestone for any company is to have some sort of product market fit where you are able to define that what you're building is actually something which is worthwhile, which is the most important step a company has to do. The second step is when you actually go from a product market fit to a decent revenue. And the third stage is you scale further and further. So I think we have crossed the first two milestones in these five, six years that we have been in existence. We have hit the $1 million of ARR milestone recently. So that's the kind of bookings that we're doing right now. In terms of team size, we have always been very lean. We have been bootstrapped. Focus has always been on hiring less people and having more cross-functional sort of a team. And we still have less than 25 people. Until not so long ago, we were only 10, 12 people. So most of the company has been actually built by 10, 12 people. And we have taken it to the point of $1 million of ARR. And now we are accelerating the company in terms of building the foundation further in terms of growth, the scaling infrastructure. That's what we're building right now. So yeah, I think in terms of funding, as I said, we have raised very small, accepted very small amounts from some angel investors who actually were our customers. And they liked the product so much that they wanted to invest. And they reached out to me on email saying, hey, this is a great product. I've been hiring from US. And I've been hiring people in India. So whenever you need any money, I would love to invest. And those people, they've come. And because it's always good to raise money from your customers. So we accepted a small amount from them. But we have not really used that amount much. So it's largely bootstrapped, self-funded. We have taken the revenue and profits. And then we are reinvesting back in the company. Makes sense. But in terms of bootstrap, many founders don't go there because it's difficult, of course. A number of years, actually, I was talking with Patti Cosgrave, the founder of Web Summit, one of the biggest events in the world. And he was saying, oh, we bootstrapped our company in the beginning. But if it was now, I wouldn't do it because it's so hard. What was the challenges for you in that experience? Do you advise that in some way? It has some advantages, of course. Yeah, I think it is. So I tend to think of it like your personal journey, right? So let's say you are a professional, right? And there is a way in the world of growing your professional career in any profession you take. So we call it rat race, right? A rat race is when there's absolute winners and absolute losers. Everybody is chasing the same thing. And you are graded on how well you chase that specific thing, right? So in our example of India, for example, we had only three choices for people to become when they were kids. You either become an engineer, like a software engineer guy, or you become a doctor, or you become a CA. CA is like a finance chartered accountant, all of that person, like a financial guy. And the fourth is arts, which is like, you don't know what you want to do. So you just figure it out, right? And these are the four things that you could do. And people would grade you based on this. These are the four goals. And if you're an engineer, and you're not going to the top school, and you're not getting a top job, then you're losing the rat race. And everybody would benchmark, you know, five years, where are you? Do you have a house now? In 10 years? Do you have a house, a bigger house, we have a better job. So those were the absolute parameters on which your success was judged. But now you know, now if you look around, and you will find a lot of people who are saying that, you know, your parameters of success are different from my parameter of success. And I can actually be happy. And that is a bigger goal, then rather than all of us chasing the same absolute goals, right. So that is for the professional life. I think similar stuff happens in the companies in a startup as well. I think there's been a narrative that startups should always try to raise money, money, money, and they try to become a unicorn, and try to increase the market cap and try to really increase the risk to go after a very, very large market. And investors and the whole VC system has been built like that has been designed like that. So there was one way of doing it. But I think there's just a way a professional life in a professional life, you don't have to become an absolute, you know, success or failure. Similar to that, I think in a company of in a in a market like this today, even if you build a small product, you have a large enough niche and large enough segment that you could go after a good example, for example, for example, of that is superhuman, which is an email app. superhuman is a Gmail alternative, right? And nobody would have would pay for a Gmail email alternative, nobody thought people would pay for it. But then human founder need that there are people who are power users of email. And let's say there are not many of them, but they have there is a market that exists and with Internet Internet distribution, you can actually do that market right now that was not possible earlier. So now there's a larger size amount that is large size of this niche that you can reach using and using a distribution model of Internet. And you can still become a profitable company. And that company is $100 million company, it can become a billion dollar company. And now you can create those kind of companies successful outcomes, even without raising money as well. So I think the perception and the whole thinking that only way to grow and make a successful company is by raising as much as possible. It's something that has been questioned now. Now, largely because of the efficiency of building a product, the cost of building a product has gone down. I remember 10 years, 15 years ago, you had to hire five engineers, but costs in Silicon Valley $1 billion. And you would need at least 25 people to build a team. So anyway, you could not have done it without raising money. But in India, if I look at my journey, I have like I have the money I put in is less than 50 grand USD. And that money is the only money the company has on debt, and everything else is, you know, is all coming from the cash. So the cost of starting the building products, the cost of marketing products has gone down. And there's a size the sizable amount of population and target segment, which is out there with interest distribution, the cost of distribution is low. So there is a there's a pretty much a good chance that you can build now a bootstrap company, a profitable bootstrap company without actually raising a lot of money. I think then after a point, you have to decide whether you want to go for, you know, a larger market, and you have competition, you have a different kind of acquisition problem, and for which you might want to raise, which is all great. But then it's not necessarily that, you know, necessary that every company raises the money. So I think we are on the site in that journey where we think we have scaled to the first two steps. And the third step is where we see money might actually make sense for us, right. So it is all contextual, it is all it's all related to a specific to the kind of problem you're trying to solve. Not every problem can be solved with money. And I think other problems can be solved, right. So we have to figure out which problem to be solving money. And I think it's a very contextual decision. But yeah, I think now it's becoming more and more easy for people to start companies. Interesting, interesting. In terms of before I want to go with your world culture, because of that, because you probably have to change a little bit your world culture. But before that, I was I was also checking your website, you have big clients, you right now, you operate, of course, more in India, but your objective is to get out of India and be a global company. And you have already, of course, because there's big companies in India, also Google, and other companies like that working with you, finding, finding talent that way. Can you explain a little bit your strategy even right now and for the future in those terms? So I think as I said, though, the more important thing is to identify a problem, which is a very painful problem for people to have, like we call it a pain teller problem rather than a vitamin pill. So if you have found a problem, which really is a big pain, then customers come to you, you don't have to go and convince them. All of these customers, all of these companies, they have had a pain point. And they have come to us, they've come to the platform, because we offered a solution, which they could try on their own and which could work for them. And all of them have come without really doing any paid marketing, or any outbound call campaigns, all of them have come and discovered us through Internet, through their friends, through the word of mouth, and through the network and all of that. So I think the first thing is, if the pain point exists, which exists in this case, because every company out there is looking for talent, and they have a shortage, every day, they don't hire every month, they don't hire, they don't build a product, they don't build a company and the company doesn't grow. So it's a very important factor of, of the capital, like how do you want to grow? So it's a very important factor for them. And that is the first pain point. And it's fortunately for us, it's everywhere, everywhere, every company out there, any tech company today, whether they are in Europe, whether they are in Southeast Asia, Singapore, London, or US, Canada, they are struggling for talent. So there is a demand for that. Now, now, our job is to solve the pain point and reach out to them. And I think because our product works well, they are able to use it on their own without us having to really guide them on board them, our cost of acquisition and cost of onboarding is low. So if we are out there, and we are getting discovered, then there is also a network effect that is already built into the product, because it's not just one product that you use, and you forget, it's something when you do some activity, it also triggers activity, activity on the other side as well. So because of those network effects, we are able to grow and we are able to create a around a business. So I think with these three things, a painful problem of distribution and a self service product that they can use on their own and network effects that will further fuel the adoption and the growth on their own by the people who are using the product. There's a good shot at a good chance that we can grow and you know, make these explosions happen in different parts. And with the whole COVID situation and remote hiring, in fact, location has become less of a problem now. Because if you asked me this question two years ago, it would have been a difficult problem to solve, because we would have to go to London, set up a demand supply and all of those stuff, London, then go to Lisbon, do the same thing there, go to Brazil, go to Europe, do all of that stuff again and again. But now since companies are not able to find talent, which is local, and they're okay with transacting and working with people across the globe across the Internet, I think it's just become more easy for us to scale and make it a successful international company. Makes sense. So you're now already global in those terms, right? In terms of India, of course, you say that you're already the number one India tech hiring platform, and with more than 18,000 companies in your platform, but these companies are already global, you already operate in a global market, right? So they are global, they have their offices across the globe. Right now they're hiring, especially from Indian talent pool, maybe for their remote, they're okay with remote positions and all that, but they largely are hiring in the context of India, when we make it international, it will be international companies and international people. So both sides will move international, that is something which we have not done yet. That's something which we plan to do in the next three months or so. Makes sense. And now let's go to that world culture I was talking about a few minutes ago. In what way and how do you have, for example, a particular example where that world culture that you tried to create for your company being bootstrapped and all, do you have any examples of how to do it, how to do it well, even mistakes you did in the past, have a good stories there? Yeah, I think when you decide to bootstrap, and I think, as I said, why we are doing bootstrapping is also important. So when I talked about not chasing absolute goals that have been set by somebody else. So that is the genesis of why you're bootstrapping, because you think, as a company, we can still be successful, we can build something meaningful. And that is a pain point that people have, and let's go and solve it. And let's do it pragmatically, let's grow the company. And we are growing it, when the company grows, everybody who's contributing to it, or get something back out of the work that they're doing. So most of the times, when you think of employees and employees that they're getting a specific paycheck at the end of the day, and that is all they're getting, then of course, you really can't expect them to be owners. And I think if you are when you are bootstrapping, you are saying, hey, you know, you're building it for customers. And we are also building it for our employees. And when the company becomes bigger, as the company is becoming bigger and bigger, you also get more and more kickback and value creation in for your own life so that you don't have to work again in your life. So our employee proposition is, you know, work here, and you will never have to work again. And work is in double quotes, right? So what that means is once work becomes play, then work is not work. And when work is not forced upon you, when you can have a financial choice not to work, when you have the skill set that you can call the shots in terms of whether you want to work at all today or not, maybe work entire month or not, that is independence, that is real independence in terms of your work life. So can we do that for our employees? And if and that is a whole culture about that, what it will take us to build a successful company that we will be proud of. And in our journey, how we will reward and distribute and share the wealth with our all team members. And that becomes the focus. And then how do you do that? So then a bunch of stuff you do, basically, you, you look for excellence, right? You have to become better and better and better in what you're doing. That's very important part of a culture. Anybody who is not passionate about what they're working on is not something somebody who will be a great fit, because this will not be incentivizing enough for them to and motivating them enough to work. So excellence is very important. It's always days day one, like Amazon says, right? So we are continuously disrupting ourselves. Whenever we build something, we take, let's say we took one month, two months to build a product, or build a feature. And we found in our customer, you know, experiences or discussions that that product is not a feature is not really helping them out, then we don't think twice before killing it right away. And we go back to the drawing board and do it again. So I think it's important to disrupt ourselves. One of my previous bosses used to say, if you don't, if you don't, you know, disrupt yourself, somebody else will disrupt you. So market doesn't care that no, whether it's you or somebody else, they need the problem to be solved. So that's also important is day one. So as you need to think like day one, and you need to keep on disrupting yourself. And third thing is we don't think in years and no quarters, we think in days and weeks and hours. So every hour at office every day, we need to make an impact that needs to be something that we go back and say, hey, we achieved this something today. And every hour that is going is an opportunity that we need to capitalize on as a hungry startup, we have to do it. So whether you're an engineer, you push code, you deploy a feature, you know, make an iota more impact today, that's very important, because all of this data improvements, they add up from different team members, and they compound over a period of time, of course. So that is the part of our culture that, you know, excellence, or it's always day one. And how do you make how do you think of your impact in hours, not in years? And how do you know, make the company progress faster? It's funny, because a famous entrepreneur here in Portugal, normally says this a lot is in a startup, you must fail fast, it's better to fail fast than wait with a product that will be failing, but you're still on it for a few months, and you're only losing time. So it makes perfect sense. Do you remember a story from the early days of your company that has a contrast from what where you are now, for example, a difficulty part of your journey as a company in the start, for example? Yeah, in fact, I think our job would should actually become easier as you progress the company, right. But I think it has become harder. I think it was easier, much easier earlier, although we did not make any revenue for the first two, three years. I did not take any salary for the apartment. We did not have an office, we do not have to pay the money to pay our salaries to salaries to people, we did not even pay salaries decent enough to other people as well. And all of that, right. So if you look at it head to head, it looks like those were the know the bootstrapped and the days where we did not have money. And those were the challenging days. But actually, those days was much easier because we did not have the pressure and operation complexity of what we have today. We had no days, they will just build a product and feature, you would have days of marketing and going out and having conversations with customers. All of that was much around product and growth and marketing and having, you know, and moving a needle every day. And we had no money and nothing else was coming at that time. Now we have the money in bank, we have more customers, we have more resources, we are paying ourselves salary, we are paying people a fair amount of salary as well. The company's stock has value. So ideally, all of that should help. But at the same time, there is more work to be done. There's more opportunity loss now, because now we have something to lose. Earlier, we did not have anything to lose. And now we have more things to do. So there's more pressure to deliver, there's more pressure in terms of can we, we went from zero to one, which was a very, very important and interesting journey. But from one to 10 is also where you think how what is a marketplace like and who can also become one to 10 and who is competing, who is not competing. So there's a lot of variables that have come in now, which did not exist earlier. So now it's like, can we if we become one to three, it's great, we are doing 3x. But is that maximum we can do is that real justification and the maximum impact that we can do? Because if we can become 10x, and we're doing only 3x, then basically that's not as we are underperforming ourselves. And that actually has become more difficult. So I think, I hope that at a point, this will become when this problem is solved from one to three to five, I think then it will become increasingly more easy for us. But I think as of now, it is actually more work. It is a work of different kind as well. Now it's more about scaling, building teams, building organizations. Earlier, it was just about product just about growth hacks. And now it's something something which is much, much more complex. Exactly. It's different. It's a different type of challenge. Interesting enough, do you, for example, do you have any advice for those who are starting a company that you took from your journey from your start? Something that you did probably would do differently if you know what you know now, for example. So I think like anything, the journey is important. So choose the market and the problem very, very clearly. Don't work on a problem or in a market, which is lucrative, but it's not inspirational for you. So because you're going to be spending a lot of time on this problem, so you need the closer you are to the problem statement, the closer you are to the target segment, you really fail to feel the pain point and you feel powered and empowered and you feel fired by the mission that you have. That's very important because even if you fail, if you do whatever, that mission and impact will is the only thing that you will have. So it's very important to choose the right market and really choose the market because I think if we had not chosen the right market, I think the right market, the right problem, there is no amount of force you can put against the market. Market has will drive everything. So choose the right market, preferably a one problem that is very important to you for you to solve so that you choose the right goal, the right direction. Now coming to the journey, journey is very important. I think I don't I'm not a person who takes things very seriously in terms of the outcome. I'd look at it more from the perspective of journey, about your learning. So if you look at the entrepreneurship or if you look at starting your startup, it is not just about reaching from point A to point B and saying, did I fail or succeed in achieving or making my company unique on? That's not the only output metric. You grow across multiple metrics. So you become financially independent, you become leader, you get so many other benefits, you get the confidence and you know that, you know, this is something even if I don't become a billion dollar company, this will be something which is important for me. So that journey is very important as well. So I think choose the market if you choose the right pain point. And if you're not just working towards one financial metric, but working at the overall holistically looking at a problem and enjoying your time, enjoying your career growth, getting to know, getting the idea, getting the chance to make an impact also is a big thing. So all of that is also important. And I think then at the end of the day, it's about, you know, you spending five years, six years of your life on doing something that you're passionate about. It's not a big deal. So I think we make it a big deal that, you know, out of your, let's say you start your professional life at 2022, you will work around 60. So you have 40 years of work life, five years, you can work on I don't think it's a big deal. It's a big ask because that will fundamentally change the way your career is going to transform. And it makes sense. Our time is almost up. Thank you so much for your experience and sharing with us. Your company is really on a high track in terms of building up. We can see that. Thank you so much for your time and hope you enjoy it also. Yeah. Thanks for having me here. It was a great conversation. I look forward to having more. Of course. We have 20 seconds. Do you have any final advice to someone in 20 seconds? I think there's a lot of advice. More important is to pick the advice and stick to it. So I would say pick any advice and just do and follow your heart and you will do great.