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Building a $5M+ Digital Design Services Firm from Kolkata: Indus Net CEO Abhishek Rungta (Part 3)

Posted on Saturday, Jul 28th 2012

Sramana: What was the next step you took to grow your company?

Abhishek Rungta: I then decided to start my own website. I went to some sites and bought a domain name and made some interesting discoveries at that time. You can actually buy an entire setup for 25,000 rupees [~$452] per month. If you just wanted to buy hosting you had to pay 8,000 rupees [~$144] to host just one site. I figured if I bought it wholesale for 25,000 rupees and was able to host 2,500 sites, I could make a massive profit on.

At that time in Kolkata, there were only a few small companies that offered hosting. I decided to take advantage of that and start offering hosting as a product. That was great because I could get clients easy because we had very few competitors. I was able to get a lot of clients, and one year I was even the largest hosting company in Kolkata. I went to any company in the area that was a computer company and I offered them a reseller package. That let them make money by offering money to their clients. I had 40 to 50 resellers in one year, and they fed me all the business.

Sramana: What was the pricing structure of the hosting, and how much commission were you paying to the resellers?

Abhishek Rungta: I did not pay them a commission. I told them that if they bought the package from me for 25,000 rupees [~$452] per year that they could resell it for at least one lakh [~$1,810]. I provided the support to clients. I basically made them entrepreneurs and a channel partner. That was a great revenue driver for me in the early days of the business.

Once I realized I could make a career this way, I decided that I should take some formal education in business. I went to the University of Bath to do my masters, and I handed my business over to my sister. She did not know anything about hosting prior to that, and she did a pretty good job of running the business. At school I learned about business and upside. What I lost was also big. I was there during the dot-com boom, so I missed that boom. When I came back to Kolkata, I saw huge billboards talking about It was like I landed in a new planet. I had lost my leadership position in the business.

That is when I had the idea of moving into a full-service business instead of just hosting. I worked at a web design company while I was in the UK. When I was working there I found out that a lot of the work we did was subcontracted to a design shop in Kolkata. When I came back I started the web design business, but unfortunately the market was in bad shape. I would make 10 to 15 visits per day but the business was just not there. It was that way for about six months. At one point I considered giving up the business and accepting a job offer I had. However, my father was a big supporter and he told me that since I had no children I should just keep working at the business and do it until I was broke.

This segment is part 3 in the series : Building a $5M+ Digital Design Services Firm from Kolkata: Indus Net CEO Abhishek Rungta
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