Learnings from Byju’s Journey

Takeaways from a fireside chat with Byju at Lightspeed’s Annual Entrepreneur Evening

Last week we hosted over 150 founders at our Annual Entrepreneur Evening in Bangalore. You can always feel the energy in the room when you bring a large number of entrepreneurs in the room, but this was amplified by a short keynote talk and Q&A with Byju Raveendran, founder and CEO of Byju’s (a Lightspeed portfolio company).

Byju is undoubtedly one of the most passionate founders we have worked with. This passion and ambition were clear when he explained how Byju’s has barely scratched the surface in their journey as they presently reach less than 2% of K-12 students. Some key takeaways from my colleague Dev Khare’s chat with Bjyu is shared below.

Dev Khare: How do you extract value from Indian consumers who often aren’t willing to pay?

Byju Raveendran: Find a category where people are willing to pay for value. Education is such a category — discounts would actually be counter-productive in an educational product. We arrived at this price since this is what most parents spend on transport and we felt this would be a more important spend bucket for them.

Of course, India is still at an early stage when it comes to subscription products, particularly given the low credit card penetration, but consumers are willing to pay once they clearly see value. This is where digital reach and freemium models work quite well — they give an opportunity to showcase value upfront to convince users to pay. Focus on showing value over building a large user base through discounting. At the same time understand the limitations of the ecosystem — our product is an annual subscription since the infrastructure and acceptance for shorter subscriptions isn’t there yet.

DK: As you’ve gone through your journey what are areas in which you’ve had doubts? How did you take decisions in those situations?

BR: I would position it differently. I think of those difficult times as experiments that didn’t work, and we thrive on experiments and taking risks — it’s a core part of our culture. However, we’re also in love with math so we’re paranoid about measuring every experiment — we can’t improve things that we can’t measure.

We’re often asked about market research and plans before we’ve launched the product, but we believe we should launch early, see the data and response we get in the first few weeks and iterate on that. This is especially true since there is no playbook for what we are doing.

DK: As you have scaled, you’ve expanded your team in a number of areas — geographically and by function. How have you thought about hiring? Who are the people you look for?

BR: When you talk about people and culture there’s a balance that some organizations miss out on. There are some people who are great at taking a business from 0 to 10 and some who are great at going beyond 10, and these are often different people. However, this doesn’t mean that you change your entire team as you grow. Think of a sports team that graduates up to the first division from the second division. They can’t simply fire all of their players and hire new ones. Similarly, you need your 0 to 10 players to stay on as you scale and build a culture of risk taking and entrepreneurship within the organization. Of course, you need to hire rockstars with expertise in particular areas but make sure you focus on hiring the right person who actually fits into your culture as well instead of just the best person. Your long-term defensibility is only culture, and culture is built upon a large organization sharing a common vision. We’ve been fortunate since almost half of our employees are former students.

DK: What are some mistakes you’ve made while hiring?

BR: There are of course many mistakes but not big mistakes. When you bring in people who come in from large organizations and are used to structure they find it difficult to fit into the madness and chaos of a startup. However, we think that madness is key to maintaining our culture and gives us an edge.

DK: You’ve scaled significantly and have 2500 people now. How do you keep the company aligned across geographies and functions?

BR: Alignment is often a function about transparency — it’s about being completely transparent within the system.

Another important thing to do while scaling is to create people who are better than you at each function. For example, I used to be the only teacher, but I no longer teach, and we’ve created much better teachers. I used to do sales initially as well, but we have a sales people who are much better than me now. You need to give freedom and flexibility to run on their own.

DK: That’s an interesting point — how do you really take away the fear when giving away responsibility? What should younger companies keep in mind?

BR: Trusting people and giving responsibility to others is extremely important. Trust is a core quality for any leader who wants to scale — one person can only do so much. You need to create an entrepreneurial environment where people are willing to take risks and aim high. We want everyone in the organization to go for the big hits. You should aim to hit every ball out of the park so that you at least hit a six. Not taking a big risk is the biggest risk. If you aren’t disrupting your own business, someone else will do it.

Besides our Annual Entrepreneur Evening, we regularly host events for founders and other members of the ecosystem such the Lightspeed Knowledge Series, Office Hours, dinners and others. To stay updated follow us on Twitter here