Mrs & Mr Khiladi!
Who says engineers are wired differently? Who says they lack emotional appetite? Who says they can master science but don’t understand the nuances of economics? Meet Sakshi and Ashish Tulsian who have defied norms, battled innumerable odds and emerged triumph with Posist. Delve into their untold story…
This was the first term sheet from a top-tier VC fund. And it came after nine years of entrepreneurial journey, which started in 2005, has had its moments of insane highs, and a sprinkling of lows. But the fact that the VC decided to play the ball with an obstinate founder was astonishing.
Ashish Tulsian was not cut from the plain-vanilla entrepreneurial cloth. Though he has always been straightforward, by 2014, he had evolved, matured and displayed zero tolerance for nuisance. The VC was soon to see the blunt, and not-so-visible side of the entrepreneur. “Can you send me your five-year projections,” asked the VC, who met Ashish at one of the investor-founder retreats, was impressed with the business — Posist — and the founder who had displayed utter disdain in entertaining any conversation. “Are you nuts,” replied Ashish. “We live one quarter at a time. And the only thing we know for sure is that we will survive,” he said. The arrogance of the founder was hard to digest for the VC who was used to founders bending over backwards to woo him for dollars.
Ashish, though, earned his swagger by successfully running a profitable telecom business for over six years. In 2012, he finally exited the venture as the regulatory headwinds clipped his wings beyond repair. The bitter learning made him realise three things. First, his next gig won’t be in a regulated segment. Second, the chances of being regulated must be next to nil. Third, it has to be a business which can scale globally. Posist, which was started by Ashish and his enterprising life partner Sakshi Tulsian in February 2012, had ticked all the boxes.
Meanwhile, a week after the retreat, the VC sent a term sheet. The expected response from the first-generation founder, though, was not along the expected lines. “Please use red pen to highlight anything which has the possibility of harming us,” was the one-point blunt directive from the bootstrapped founder. “Don’t hesitate to point out even the remotest possibility,” he sternly yet politely underlined his instruction.
The lawyer obliged. After a few days, he handed over his comprehensive diagnosis. The dissected term sheet looked like a communist flag or a report card of a student who had flunked in all subjects. “It was a sea of red,” says Ashish, who was never keen to entertain the VC who wanted to invest $1 million and pick up a 33% stake. The computer science engineer was not amused. He sent a revised and a thoroughly sanitised sheet, and a new offer: 20% stake for $1 million. “Do you have his MMS,” the lawyer asked in disbelief. He was stunned to know that the VC had accepted. “Or have you blackmailed him,” he continued to babble in his state of shock. “How can he just do it,” he rattled on.
Million-Dollar Question
There was more drama to unfold. A week later, the VC came back with a bigger and better offer: $3 million and the stake remains the same: 20%! Ashish was overwhelmed with the amount on the table. “Lekin hum 3 million ka kya karenge (But what will we do with $3 million),” he asked. The VC smiled, and parroted well-rehearsed lines. “We will make aggressive plans. We will scale.” Ashish was not impressed with the hoopla. A few days later, an associate was sent to the founder’s office to help him make projections which would be presented to the IC (investment committee). On the very first day, she dropped a bomb. “Pricing is friction. So we will make your product free,” she declared. The cofounders were badly shaken up. “Lekin phir paisey kaisey banayenge (but then how will we make money), asked Sakshi. “Don’t worry. A business model will eventually emerge,” came an assuring reply.
Back in 2010, Ashish thought he had hit upon an amazing business model. “Chal chal restaurant kholte hain (let’s open a restaurant),” he said to his core team at TechnoApex, the telecom venture which was in the midst of a painful churn due to abrupt and arbitrary regulatory changes. Ashish — who was in love with Biology, took up the subject in class XI and then had a sudden change of heart the next day when he got to learn that dissection was banned — always shunned those career options where there was too much work. So CA, CS, MBBS, LLB…all these never crossed his mind. Mighty impressed with the academic achievements of his father — an SRCC alum who also completed his masters, CA, CS, law, doctorate, and authored books — the son once harboured ambition of studying more than his dad. But eventually, he killed the idea when he understood the toll, toil and years it takes to excel in academics. Three things, though, he inherited from his father was dogged perseverance, hedonism, and intense passion.
Now in 2010, the passionate entrepreneur was dealing with his food pangs. He wanted to start a restaurant. A consultant was hired, Rs 30 lakh was spent to prepare an elaborate blueprint, and a gleaming physical map of Delhi was hung in the office of the founder. “Hum 10 aur kholenge (We will open 10 more),” Ashish outlined his ambitious plan for Rasoi Express, a vegetarian restaurant at Shalimar Bagh, North West Delhi. In the grand scheme of things, after opening 10 restaurants, the plan was to take franchise route. “First we will target 50,” he declared. In 40 days, the first restaurant was ready, and for the next 120 days, it ran on full steam. “The plan was to scale it to 500 outlets,” he says.
In the 4th month, though, he discovered 500 holes in his business model and plan! One of the good sides of being a passionate founder, he points out, is to get deeply involved in things. But then there was a flip side as well. As Ashish went deep into the nitty-gritties of running the restaurant business, he unearthed an unpalatable truth: there was massive pilferage. The food bucket was leaking from multiple holes. Kickbacks from suppliers to compromising on raw materials to cutting corners to accounting jugglery, the lapses were glaring and unforgiving. He fired the consultant who was running the show.
The problem, though, snowballed with the exit of the consultant. From handling municipal authorities to taking regulatory permissions from labour, fire and police departments to managing countless vendors, Ashish was swamped with work and problems on all the fronts. “For three months, we fought with everyone,” he says. The founder realised that the restaurant was fast turning into a liability.
Food For Thought
Meanwhile in 2014, there was another liability that Ashish and Sakshi were trying hard to get rid of: the funding conversation with the VC. From $3 million and a 20% stake, the offer was sweetened to $7 million and a 40% stake! It had been more than three months of protracted negotiations, and all these days, the cofounders didn’t do any work. It was all about aggressive hiring which included CXOs with insane salaries of Rs 1 crore plus, expansive scaling across dozen countries, chasing topline at all costs, and prepping for the next round of funding at a higher valuation. The cofounders wanted to end the circus. And eventually it did end.
The fun, though, continued over the next few months. This time, there were new players who got to know about the nixed deal and threw their hats in the ring. Ashish and Sakshi pick up the three best entertainers among the lot. One of the VCs nudged the founders to pivot their business model and become ‘another Swiggy.’ The second VC too had a similar thing in mind but with a different name: why don’t you become like Zomato? The third one proposed a radically different business model: become a Roadrunnr.
If 2014 was dramatic, then the next two years — 2015 and 2016 — were sensational. A big food tech player tried to buy Posist thrice. First time, it was a friendly offer. Second time, it was a serious proposition. And the last time, it degenerated into ‘either you sell out or we will make our own version of Posist and kill you.’ “Is it a threat,” asked Ashish. “No, it’s a situation,” replied one of the negotiators. “Okay, then you go ahead and make your version,” retorted Ashish. The rivals were taken aback. “So, is it a challenge,” another negotiator asked. Ashish responded in kind. “No. It’s a situation.”
Sakshi, meanwhile, tells us why there was never a situation when it came to the chemistry between cofounders who also happen to be spouses. “I am the present. He is the future,” she smiles, describing how the couple manage the work, life, business and defined their respective areas. He is someone, she describes her husband, who thinks three quarters ahead. “I am someone who lives in the present and ruthlessly executes,” she says. After her formative stint at Sapient and then a few years at TechnoApex, in 2009, the computer science engineer founded Websanchaar Solutions, which offered web solutions to over 750 SME clients. In 2012, she decided to join hands with Ashish and start Posist. The decision was not an easy one. All three ventures — TechnoApex, Rasoi Express and Websanchaar — were profitable businesses. It was hard for the couple to shut down the ventures which were making money and then start from scratch with Posist.
So over a decade into the entrepreneurial journey with Posist which now has a presence across 50 countries and boasts of over 18,000 F&B partners, is there anything that the founders would like to offer to the rookies or wannabe entrepreneurs? Ashish comes up with the first lesson. “Always believe in the value of compounding,” he says. Things might not turn out the way you want them to be on Day 1. “But one day, they will. Just be focused, and don’t worry or think about competition,” he says. The founder shares another insight. “There are no shortcuts or ways to make quick money,” he says, adding that success is not a Ponzi scheme. “It’s sweet when it takes time,” he says. And as far as revenues are concerned, Ashish lets on, there is nothing called booked revenue. “If the money comes into your account, then it’s revenue. Simple. Period,” he says. Sakshi too chips in with her wisdom nuggets. “Don’t be a cheaper Indian alternative in the market,” she says. If you undervalue yourself, she underlines, nobody will value you.
But back in 2014, there was somebody who was putting a value. Remember? A venture capitalist and his $7-million offer? How did it feel to decline?
“We celebrated,” says Ashish. “Champagne kabhi kabhi $7 million decline karne pe bhi khulti hai (At times, you pop a Champagne bottle by not taking $7 million),” he laughs.
