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Calling from Seattle

Paran Balakrishnan | January 31, 2004

Sanjay Kumar has lived the Silicon Valley Dream -- in more ways than one. He joined Microsoft in 1990 (okay, that's not Silicon Valley, but it's the same spirit), stayed through five stock splits and became a multi-millionaire. Then he scouted for ways to become a serial entrepreneur and earn even more millions.

Scores of other techie wunderkind came out of the roaring '90s with the same dream (Sabeer Bhatia, Vinod Dham et al) of being serial entrepreneurs and hitting a double jackpot financially.

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But 37-year-old Kumar, a much less well known name, has pulled it off where others have failed. What was the secret of his success? He realised that India had suddenly become the land of opportunity. Also, he didn't get blinded by hi-technology.

The result is vCustomer, a Delhi-based BPO outfit, which is growing at dizzying speed. In October it had 1,500 people manning its helplines. By December it ramped up staffing to 3,000 and is still hiring at high speed.

The current plan is to have 6,000 people by yearend but, says newly hired president Sujit Bakshi: "We may hit that level by September."

Hiring Bakshi became an urgent necessity as vCustomer started to grow at scorching speeds. For the last three years Kumar has been a jetsetting chief executive operating from Seattle and flying into Delhi at regular intervals.

He has been aided by technology: he has one phone number that rings at his home, his office in Seattle and also in Delhi. "People who call me don't know where I am taking the call from," says Kumar.

After scouting around for months Kumar settled on Bakshi, an industry veteran who climbed through the corporate ranks at HCL. Bakshi was HCL's pointman when it took over BT's call centre in Northern Ireland.

"It was tough getting the ex-BT employees to accept an Indian employer," he says looking back on the experience. Bakshi joined vCustomer in October just as it was stepping up recruitment.

Fast growth has thrown up the inevitable problems at vCustomer. The four-year-old company already has three centres that have sprung up in swift succession on the Delhi-Faridabad road. Now it's opening a fourth centre in Pune which has 1,000 seats and which will be operational by March. There's already talk about a fifth centre.

How do you live in Seattle and run a company based in Delhi that is growing at blistering speed? Kumar insists that it hasn't been as tough as it might appear. He's constantly on the phone to department heads in Delhi and they call him directly with all manner of problems.

At another level, customers in the United States know that the company's chief executive is close at hand. VCustomer also has a senior team of 15 people in the United States including Kumar, the chief financial officer and a tech person. Kumar says he spends five or six hours a day talking to customers.

Kumar is a techie who has always shunned the limelight. He left India to study in the United States and signed on at Carnegie Mellon University.

Later he did a Ph.d in computer sciences from Pittsburgh and joined Microsoft in 1990. His timing couldn't have been better. Microsoft was already a giant in corporate America but its growth story was barely beginning.

Over the next few years Microsoft entered the era of explosive growth and the result was that thousands of staffers became extremely wealthy. Kumar ended as a department head and says that around 200 people under him became millionaires. "Some of them very serious millionaires," he says.

In the late '90s he was offered a research job at Teledesic and it seemed precisely what he wanted to do. Unfortunately, Teledesic, which was looking at broadband solutions, wasn't the great success that had been expected and Kumar quit after realising it wasn't going anywhere.

Kumar figured it was time to strike out on his own and he made several trips to India before figuring that the BPO business was poised for growth. Most friends and colleagues were shocked that he was contemplating an entry into such a 'low tech' field.

Nevertheless, he persevered and put together an impressive team of backers including Scott Oki who had built up Microsoft's international division and venture capital firm Warburg Pincus. His early investors are believed to have put in about $20 million.

Another $7 million was raised during a second round of financing. The company currently says it has a war chest of $25 million and it's actively scouting for a takeover target.

Armed with the start-up cash, Kumar launched his company with 10 people manning the helplines. It quickly picked up more clients. Today the company has 18 large customers and around 1,400 staffers are engineers. The company has also progressed up the ladder in other ways.

A large number of calls it handles relate to what are called Level Three problems, which relate to complex problems like bugs that develop in software. At times the company has to simulate customer experiences in a laboratory. "In a fairly large number of cases we get paid on resolution," says Bakshi.

These days vCustomer is getting picky about the clients it picks up. Bakshi says, for instance, that they won't deal with corporations like Wal-Mart and Dell which shave every penny off deals and which have turned cost saving into an art form. Nevertheless, the company has signed one big deal in the last one month and is poised to sign a second.

At another level vCustomer is trying to maximise its revenue and service to customers by setting up a lab, which does a mix of data mining and research.

The data could, for instance, indicate what times are the most popular for callers from a certain region. This data can be offered to customers either as an add on or for extra payment.

Is the future bright for vCustomer? Kumar and Bakshi both think it is. The BPO business is a tough one but they believe vCustomer is ahead of others because it's in the business of technical help.

That means attrition rates are slightly lower (25 per cent) than at other call centres and customers aren't likely to shift unless there's a major complaint about service. Says Kumar: "There's more stickiness."

Will Kumar return to India if the company expands? It doesn't look like it. He waxes eloquent about the beauty of Seattle. "That's where my life is. That's home," he says. Since vCustomer is thriving he could be commuting from Seattle to India for a long time to come.

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