Bootstrapping Using Services to an Awesome Business Model: Inspyrus CEO Nilay Banker (Part 5)

Sramana Mitra: When did you start selling the product in this whole gain share model? You said that 2008 is when you started two and a half years of services mode while you got the handle of what the problem was and what product to develop. Was 2011 your first year of selling the product?

Nilay Banker: Yes, 2011 was when our first product came out. We started with invoice automation. Then in 2014, we came out with total discounting. It took two to three years for the base product to mature. We got a healthy base of happy and large customers. We focused on the large customers.

Sramana Mitra: How much did you do in 2011, for instance? >>>

Bootstrapping to $30 Million from Czech Republic: Vaclav Muchna, CEO of YSoft (Part 4)

Sramana Mitra: What year are we talking about?

Vaclav Muchna: 2003. In 2002, we launched that web server. We had to produce 20 terminals and we had no money. I tried to go to the bank but, of course, they didn’t let us borrow anything. There were only few VC funds. The VC market almost didn’t exist. The few VC funds that existed said that this was not an interesting project. Eventually, I found a business angel. He lent me money personally – not to the company. You can understand the impact on liability. The interest rate was 40% per annum.

Sramana Mitra: My goodness. >>>

Bootstrapping Using Services to an Awesome Business Model: Inspyrus CEO Nilay Banker (Part 4)

Sramana Mitra: How do you do that? How do you take an internal operation and turn it from a cost to profit center? What did you that was innovative there?

Nilay Banker: That’s a great question. It all starts with making sure that you can achieve process efficiency. Process efficiency, in this case, is how long does it take for you to process an invoice that a supplier sends you and eventually make the payment to the supplier. We started off with that as the core of the solution – helping automate that business process and getting it down from 20 to 25 days to 2 to 3 days. >>>

Bootstrapping to $30 Million from Czech Republic: Vaclav Muchna, CEO of YSoft (Part 3)

Vaclav Muchna: The three of us started again. I kept 20% and they both got 30%. We started again without really knowing what to do next. One customer came and said that they would like us to develop a software that would secure printing. They wanted to remove 200 desktop inkjet printers and install 20 shared network printers. The problem was that if you print something on a network printer, you have a problem with data protection.

They wanted us to make a system where documents would not print unless you go and swipe your badge on the printer. We developed that and thought that it was interesting. We worked for that customer so we knew that the industry was going towards removing these inkjet printers and work with centralized >>>

Bootstrapping Using Services to an Awesome Business Model: Inspyrus CEO Nilay Banker (Part 3)

Sramana Mitra: Let’s talk a little bit about some of the nitty-gritty processes. What year did you start Inspyrus?

Nilay Banker: I started Inspyrus in 2008.

Sramana Mitra: You said you started by consulting. How long did you operate this company in a consulting services mode that got you the opportunity to understand the problem at a deep level?

Nilay Banker: We did consulting services for about two and a half years.

Sramana Mitra: How many customers did that expose you to? >>>

Bootstrapping to $30 Million from Czech Republic: Vaclav Muchna, CEO of YSoft (Part 2)

Sramana Mitra: What year are we in now?

Vaclav Muchna: That was 2000. It was a month after my 20th birthday. We started the company together. We really didn’t have any vision, we just wanted to be rich and famous. We wanted to succeed and we had no idea how. We had no education. We had no background.

The only thing we knew was that we are not afraid to work. We did different things. We wanted to participate in projects and build something. We had no idea what. What happened was we were often hired as developers to participate in a project that was funded by a business angel. We were paid >>>

Bootstrapping Using Services to an Awesome Business Model: Inspyrus CEO Nilay Banker (Part 2)

Sramana Mitra: How long did you stay at Oracle?

Nilay Banker: I was at Oracle for 10 years. On the first day of my 11th year, I decided it was enough. I had a lot of fun. I actually had a great opportunity to work with Larry Ellison for an extended period of time. At that time, I was responsible for the development of oracle.com for our portal product. I got to meet with Larry Ellison on a weekly basis.

Sramana Mitra: What happens next? What’s the next career move?

Nilay Banker: That’s when I decided that I need to figure out how things happen on the other side, which is not the software provider but more of a software >>>

Bootstrapping Using Services to an Awesome Business Model: Inspyrus CEO Nilay Banker (Part 1)

If you haven’t already, please study our Bootstrapping Course and Investor Introductions page. 

We’ve shared many Bootstrapping Using Services case studies with you here, as well as in the book on that topic. This one is particularly interesting because of the absolutely awesome business model that Nilay and his team have implemented. Read on!

Sramana Mitra: Let’s go to the beginning of your personal journey. Where are you from? Where were you born, raised, and in what kind of background?

Nilay Banker: I’m from India, born and brought up in Ahmedabad, which used to be a sleepy town when I was born and growing up. It has now blossomed into a sprawling metro. It’s one of the five largest cities in India. I had a very interesting childhood. I grew up in a family of professionals. My father is an architect. My mother is a doctor. Pretty much, every person in my family is a professional with very few people who are not doctors. I consider myself a black sheep in the >>>