START-UP ISLAND. How focus on spending priorities can benefit start-ups in the long run

Early last month, while going back on how Simplilearn chose its leadership, this column asked if “good business without a knack for building strong teams” could benefit start-ups in the long run? A younger start-up Rubique (set up in late 2014) has chosen to grow by spending the funds it raised “on technology and hiring the best of people”. In Rubique’s case, that meant less spending on marketing and buying traffic, and a lot more. “If our story stands out, it’s because we’ve not hired too many people, our monthly bills are the same, our revenues have grown, and we’re working towards breaking even by September 2017,” says Manavjeet Singh, Founder & CEO, Rubique.

As a platform that attempts to match commercial lenders with borrowers, Rubique is tied up with around 65 financial institutions across India and has disbursed more than ₹1,000 crore in loans so far. All the while, Rubique’s headcount has remained steady at 88 people. Singh prefers to “go slow but be robust” with the value Rubique offers.

The company has made ₹17 crore while being an SME-inclusive player. (For the longest time, financing for the SME sector in India had remained arbitrary and financiers, therefore, incurred high customer acquisition costs.)

“We’ve kept our headcount the same, we’ve only changed the team composition over time. Earlier, we had more people in business and support, but now the company has more people in technology, followed by business and support functions,” Singh says. While helping to get loans get processed faster, Rubique also had its own processes audited – a decision Singh says some called foolish, although he’s believed it’s an appropriate expenditure to incur.

The founding team’s capacity to say yes to some things and no to others affects its progress. Even after being recognised in international markets with a few awards, Singh seems to be in no rush to add geographies. “This is a massive market and in spite of our success, I still see our company as a successful pilot. Other markets are way ahead of us,” he says.

Notably, of 160 financing products that are on offer on the Rubique platform, more than 90 are suitable for the SME sector.

“I think it’s because of our focus on SMEs that we’ve been recognised with the awards we’ve won. But even in India, it would be foolish to be ahead of the ecosystem. At the end of the day, it’s all about cash flows,” Singh explains.

Singh remains positive about all stakeholders, even regulators, moving with the times as they see more models working and paying off for the financing sector.