InMobi: The journey of India’s first unicorn

It is an open office where scores of employees in their 20s are busy on their computers. You walk through the office, the rich aroma of freshly brewed coffee wafts through, and go to a conference room whose name is Out of the Blue. Later, walking around the office, you are shown a partitioned area with sports facilities. There is even a cricket nets. No surprises here. Naveen Tewari, Founder and Chief Executive Officer, InMobi, is a cricket fan. He has played the game, still tries to play it whenever he gets the time, watches it on television and goes for IPL matches in Bengaluru.

You ask Naveen what would be the average of his team and he replies somewhere in the late 20s. Do you feel old amidst them? “I do,” he replies, “they tell me so also.” It is a completely open office, designed by the employees themselves, says Naveen. His philosophy is that the office should be designed by people who are going to be using it. “It is a place where you spend 70 per cent of your waking hours. So, you might as well come in and create it,” he says.

The innovative spirit

InMobi’s strength comes for the innovative spirit that it fosters. “Look,” says Naveen, “innovation is not a thing where you say, tomorrow morning let us all be innovative. It is a state of mind, it is a state of being where you come and say, I will think very differently because the environment allows me to thing very different about something. That is what leads to innovation. These are little things that add up to the creation of that environment.”

The Bengaluru-based InMobi started off as mkhoj in Mumbai. Why the pivot? Naveen says the founders realised that mkhoj would have been successful, but it would not have been a large business. It would have become a nice, mid-size company. In your late 20s, you don’t leave everything to try and build something small, he says. “Even if we are successful, it is going to be small. If we anyway have to go through all the pains of line and the pains of entrepreneurship, we might as well aim big, right,” he adds.

The founders spent nearly 18 hours holed up in a room discussing what next. It was a tough decision as they had put everything they had into building mkhoj. If the mkhoj business model of monetising SMS was ahead of its time in India, Naveen and the other founders took on an even bigger bet by pivoting to InMobi, where the focus was on advertising on mobile phones and the growing use of mobile internet.

“We bet on the fact that there will be smarter phones, there will be content of a different nature that will appear on phones and people will use a lot of that. Our bet initially was that Asia would be a big market for it and not necessarily North America,” says Naveen. He admits that they were proved wrong in one of the assumptions; now, the US accounts for more than 50 per cent of InMobi’s business, followed by China with about 20 per cent and Asia and Europe the rest.

Along with the transition to InMobi, the founders moved lock, stock and barrel to Bengaluru. Talent was the only consideration for this, says Naveen.

InMobi was going to be an engineering company that would require high-quality engineers in large numbers and Bengaluru fit that requirement well. “We are glad we made that move. It paid us really well. We wanted to get the highest quality of engineering talent, design talent, product talent in the company and that has been one of the reasons for our success.”

There were sceptics who questioned the wisdom of trying to build a products company out of India, which still was not known for its products capability. The decision to move to Bengaluru was again a punt and it has paid off for InMobi.

InMobi, says Naveen, is an end-to-end advertising and marketing platform. It is a B2B SaaS company. From an end-user perspective, InMobi enables consumers to consume content for free. It enables this through methods of advertising and marketing. The company works closely with marketers to make sure that when they are subsidising content, they get their money’s worth.

“We create software for that. We create deep technologies for this. We leverage artificial intelligence to make sure that the advertisers’ money is well spent and the consumer experience is great in that,” says Naveen.

The secret behind the success

Naveen attributes many reasons for InMobi’s continued growth and success, one of which being the founders and the core team have stuck together all these years. There are not many companies and technology start-ups, he says, that can claim to have built a culture of continuity. The other reason, according to Naveen, is “innovation is in our genes.” He promises there will be more innovative products coming from InMobi. He does not want to disclose company financials apart from saying it is “very profitable and growing heavily, 40 per cent odd growth.”

InMobi has so far raised about $250 million and turned profitable in 2016 and is able to plough back money into the business. The investors have also stayed invested in the company, far longer than what they normally would be invested in any venture. “As long as the company is making capital, is showing growth, they don’t have an issue in staying with you.” Do the investors talk about an exit timeframe that they have in mind? “We discuss that probably once a year to figure out what is the best time period to do so,” says Naveen and adds that an IPO is likely to happen in 2020-21.

What was it like in 2011 when it achieved Unicorn status? “We didn’t understand what it meant. It was a great moment for us, because it was a sign for us to say we have to think differently. It was a sign for us to say we have to take what we have done and we have been given the licence to build something bigger. We cannot waste that licence. The feeling in the company was of very high pride.” It is not as if it has been all smooth sailing for InMobi. In 2016, the company faced a lot media flak over employee attrition. There was bad press, admits Naveen, but adds there was not much substance behind that. Those trying times also made the company more transparent with its employees. He communicated to them that there are problems, but not as being magnified in the media. He opened up the company’s books for the employees themselves to see the reality.

“In 45 days, we became profitable without cutting random costs. That was the period we had the least attrition in the company. We came out very strong. As a company we became very transparent,” he says.

When he communicates regularly with the staff he underlines the fact that InMobi is an ambitious company and that it will be one of the largest SaaS companies in the world, not just in India, shares the company’s plans with them and talks about executing those plans well.

Tips for entrepreneurs

Ask him about his experience of being an entrepreneur, Naveen says “entrepreneurship, the way I describe it, is you are in a boxing ring and your hands are tied and you are getting punched. You are just not going to give up. You are going to tire the other person out. That is what entrepreneurship is all about. You are going to fall, but you are going to get up. I know for a fact that a lot of us in the company will not give up.”

What would be his tips to those starting off as entrepreneurs? Entrepreneurship, he replies, is all in the mind. As an entrepreneur, you might as well go for something big, because your chances of success going after a small thing versus a big thing are pretty much the same. Second, surround yourself with great people and make sure they stay with you. Third, take the risks; if you do not take the risks, you are not going to get to some place which is meaningful.

How should an entrepreneur decide which investor will be best for him or her? Naveen says “the one who is willing to not meddle and not be involved too much with you is the better one to take. Good investors are the ones who stay away but help you create the boundaries on things that you should be aware of.”