rBus wants to bring affordable happy commutes to our cities

Meet Siddharth aka svs. A guy who loves to code. A graduate from IIM B who didn’t quite enjoy the Investment Banking world. A music lover who built a core-banking system equivalent for MFIs- as an open source. An idea, which aspires to make city dwellers stay happy after those tough daily commutes-rBus. You can email him at svs@svs.io


ValueMax: Tell us a little about RBus

svs: Commuting in India, for the most part, is really painful. Either it is expensive, or it is terribly uncomfortable. rBus intends to use modern technology to provide you with a guaranteed seat on a point-to-point bus from your home to your office and back, while being able to accommodate changes in time of travel from day to day.

ValueMax: How come you moved from Banking to IT to rBus

svs: I’ve always been madly in love with software and even in the banking world, I chose to do the geekiest work I could find, building large models and dealing essentially with software. So I guess it wasn’t surprising that I eventually wound up doing this full time. Building financial models is fun for the first few years, but it can become quite repetitive. Besides, I always felt there were bigger problems that one could solve with software. rBus is one such attempt.

ValueMax: You mean open source technology? Your previous venture was also an open source platform, right? Why this love for open source?

svs: rBus is built on a lot of open source technology, but the platform itself is not open source. Actually the web app is quite trivial (for now), but we’re hoping to implement some hardcore routing algorithms and so on. I expect most of these will be open source. With rBus, the value is not so much in the technology as in the execution. Everyone has access to cheap GPSs and Google Latitude. The question is – how many people love public transportation enough to execute this vision with a lot of care?

I love open source because of the community of people who contribute to it and I love to count myself amongst them. However, this does not mean that open source is always the best approach. Sometimes it is easier to attract people and execute the vision as a business than it is to build a strong open source community, and in these cases, it is perhaps better to adopt a commercial approach. However, the discussion is so nuanced that I’ll stop now before I am misunderstood 🙂

rbus
ValueMax: But why RBus? What drives you to solve this “problem”?

svs: Having lived in cities with decent public transportation systems, I understand the impact that this one thing can have on the lives of the citizens. Just reaching work in a relaxed and cheerful state of mind and reaching home likewise make for a productive workforce and happy families. These seem to be quite important things in my opinion.

Secondly, the private car seems to be a perfectly wasteful way of getting to and from work. Not just the waste of fuel, but of time spent in the endless traffic jams and the devoting of precious space in our cities to more roads that fill up as fast as they are built. this doesn’t seem like a good direction to go in for the long term.

Of late, the technology to build a responsive, commuter-centric shared transport infrastructure has become quite easily available. Cheap and ubiquitous GPS, smartphones, mobile ticketing technology – all of these can help us to connect the demand side of the equation (the commuters) with the supply side (commercial bus fleets).

The power of the internet to connect people so that they can solve their own problems has always fascinated me, and I would love for rBus to be a manifestation of this.

And lastly, the market for commuting is IMMENSE. It gives one the opportunity to build something truly significant and hopefully, robust, durable and something that people really love because it is simple and it solves some deeply felt problems.

ValueMax: You talk about a happy rBus experience. What aspects are you referring to and how will you manage this?

svs: The rBus promise is as follows – no waiting, no standing, flexible timings. The convenience of a car at the fraction of the price.

You choose your trip time, get an alert when the bus is approaching, walk to the bus stop, board the bus, sit on your reserved seat and reach your destination with zero stress. In my opinion, this beats any other mode of transportation. It is orders of magnitude more comfortable than the other public transport options and orders of magnitude cheaper than a chauffeur-driven car.

You will always have people for whom priorities are different. However, there are a number of things to consider here:

  •  In a population as large as Mumbai’s I am really hoping that there are enough early adopters who share the vision of rBus to adopt it even in this unproven state.
  •  Once we can demonstrate just how convenient and economical it is, we hope to attract atleast a critical mass of people on Mumbai’s main arterial routes to allow us to run a sustainable service.
  •  Once the service is self sustaining, we will start to allow ad-hoc travel, giving people the opportunity to leave their car at home for a day if they so wish.

Beyond that, the service itself will have to perform and exceed expectations.

Also, do remember that there are a number of college students that do not have their own cars. They’re just waiting for the day when they have enough money and they can stop using public transport. If we can provide them a robust experience on rBus, perhaps they will delay buying the car, or use it sparingly when they do. The young hopefully do not have the same prestige issues as their parents, and I do believe they care deeply about the environment. Hopefully.

I’m an optimist and I believe that people will ride rBus precisely because it’s way cooler! In 3 years, rBus should be the de-facto mode of reaching office for commuters in Mumbai and hopefully other cities as well.

ValueMax: People have run chartered buses for office commuters before also. What’s the tech layer that rbus provides? Can they be used by current operators to improve their services significantly?

svs: GPS tracking of all buses and mobile based ticketing are the main technological advancements. We also plan to build advanced routing algorithms (once we have enough data). Implementing the GPS tracking is quite trivial and there’s even a company called http://yourbus.in which specializes in this. However, most bus operators aren’t really tech savvy and so they haven’t implemented these.

ValueMax: Who do you target through rBus?

svs: If your commute stresses you out, wastes large amounts of time or is inordinately expensive, you should definitely try out rBus. If you own a small-medium sized business and you are fed up of your employees walking in the dorr in the morning already stressed out from just getting to work, then you should definitely support rBus.

I can segment my customers based on the mode of transport they currently use. The people who currently commute by bus/train are very price sensitive but I am hoping there are significant numbers there that can pay a bit more for a vastly improved experience.

Amongst those who use private transportation, I would love for the reluctant driver to give up his car. So far this seems the most difficult segment to convince. I think people don’t believe just how convenient the rBus can be, and there’s always a radio taxi for the exceptional circumstances. In the end, rBus is about 1/4th – 1/10th the cost of driving to work, so again I am hoping that I can attract more than a few car commuters to rBus as they take up a disproportionate amount of space on the roads.

ValueMax: Your toughest challenges right now?  Looking to expand the team?

svs:

  • Marketing
  • Pricing
  • Logistics – negotiating with bus fleet owners, ensuring quality of service, etc will be big challenges for the future.

Yes, Absolutely. I need programmers, marketing people and energetic people to supervise operations. Do get in touch (on Web – www.rbus.in or on Twitter – @_svs_ and @rbus_in). And yeah, some funding would be great too!

ValueMax: What are the learnings from the first 50-75 days of rBus?

svs: Over the last few weeks I have been validating my assumptions by using BEST buses for my own commuting needs. I found out that the bus is not slow at all, once you get on it. It is getting on the bus that really hurts.

One is never really sure about anything – when the bus will come, how full will it be, etc. I also found that the bus is quite comfortable, if you can get a seat. So I think my main offerings of “no waiting and guaranteed seating” are the correct product features to offer. However, rBus not being subsidized  by the government makes it significantly more expensive than the BEST bus and so it’s been a challenge convincing people that these features are worth paying so much for. I hope to convince many more people once they see the first rBus running.

Banking to Dairy Farming | Interview Part 2 – Vigyan Gadodia

Part 2 of the Interview with Vigyan Gadodia of Sahaj Group. See part 1 here.
Explain in more detail, why dairy farming? Also, why the need to be in production? Why not just milk-distribution?

 Vigyan: Dairy farming offers the following key advantages:

  1. On standalone basis it is a profitable activity for a farmer. It is the most cash-flow friendly business activity for farmers (if planned properly) , which can provide a regular income to meet their expenses.
  2. Farmers understand the fundamental activity of rearing cattle. So the learning curve is already there.

The reason for us (Sahaj Group) to get involved were

  • There is a scope for significant enhancement in management practices. This can lead to an  overall improvement in the business profitability. Lemme give you some specifics.The most fundamental error we make in cow management is to discount cow intelligence. In India we generally keep our cows tied down all the time and feed, and milk her as per our schedule at the same place. Some of the key parameters of improvements that Sahaj is working upon are:Labor Efficiencies – This makes the process very labor intensive. Open housing allows the cows to roam freely, be less aggressive (and hence easier to manage), and cows can eat and drink whenever they like and they can come to common milking place. Average cows handled/person in Indiais 8-10 Vs 20-30 in organized farms internationally.Yield improvement – India average milk production (even in crossbreed cows) is around 2500 ltrs/year, vs the average of 8000 – 12000 ltrs/year production done by farmers in US / Israel / Holland / Australia. Some progressive Punjab farmers have reached a herd level production of 6000 ltrs/year by using the above mentioned good management practices.Quality of Milk – The bacterial content in the raw milk in India exceed 10mln CFU/ml, Vs internationally accepted standard of 2 lac CFU/ml. Large part of this quality gap is due to the unhygienic milk handling (hands / buckets / open to shed air etc) and delay in chilling. Milk quality can be significantly improved by providing cows with good quality drinking water and using efficient cleaning methods.
  • The overall purity of milk is a serious concern creating an opportunity for quality premium producers supply chain.  We feel this is a significant enough opportunity. A farmer gets Rs 18-20/ltr for cow milk if he supplies to a  dairy, whereas a village level consumer is happy to buy the same milk at anywhere between Rs. 23-26 / ltr on a regular basis.  This is because of a quality concern (more like insider knowledge) at rural consumer level and they prefer to pay a premium for getting un-adulterated milk from neighborhood farmer. Supply-chain/logistics  constraints like late chilling, mixing of water, synthetic milk etc becomes more pronounced for the cooperative milk collection and hence entering the urban consumer level. So, local consumer (village level) gets the best quality milk, and urban consumer gets mixed and sub-premium quality milk.

cattle-shed1

Can you give us a feel of where Sahaj is right now

Vigyan: We have 23 cows under management as on date and a team size of 12 people gearing to scale up the operations to 500 cows. We are in the process of fund raising for our expansion activity. If the funding comes through in time, we shall be targeting 1000 ltrs/ day by Dec 2012, and upto 5000 lrs/day by March 2013.

Why do/should clients buy your products. Who are these customers? What experiments have you done on product-market fit. Is it a challenge to identify & reach out to clients ?

Vigyan: Customers buy our product because of Purity and Quality. Some of the customers have already started commenting on better digestion of cow milk . They can easily draw a contrast with the regular pasteurized milk in the market.

Our current consumers are in Jaipur city. We started with milk sampling and these families/individuals started with switching a part of their requirement to our milk. Gradually many have switched 100% cow’s milk.

We are yet to design our marketing plans, so it will be difficult to comment on expected marketing expenditure as yet. However, yes, there will be a bleeding on operational basis as well, till we hit a threshold volume of at least 700 ltrs/day of supply in the city.

We have started pouching much early in our evolution to address the concerns of contamination / adulteration in the transit. Because of pouching it is easier and faster to reach out to a larger audience and explore different distribution models like retail counters as well. We intend to leverage this strongly in our marketing efforts.

Your 5 key learnings in the first 12 months of the venture ?

  • Doing business in India is tough and working in rural India is even tougher. Well I asked for it 🙂
  • Financial markets (equity & debt) are averse to exploring new (un-heard) ideas and do not like startup ideas that are not following a hockey stick projection.Most VCs have never evaluated such a model, and the existing large farms are typically backward integration by large scale diary processors, who do not need venture funding.Also, this is a capital intensive model to begin with, and the idea of extending the good management practices amongst farmers is yet to be proven. Most VCs are used to looking at technology based hockey stick growth models, and are hesitant to look at an operationally intensive model like Organized Dairy farming.
  • It is difficult to cultivate a long-term view in rural youth (Vs a very shortsighted approach), but if you can do it you can change India.
  • Most of the quality management services can be implemented at a farmer level, provided a basic minimum scale is achieved.
  • Cows milk is actually quite good to drink 🙂

Your goal for the next 3 years.

Vigyan: Create a model dairy farm (200 – 500 cows).

Extend dairy farming services and become a significant milk producer in the state.

Expand the product basket to include fruits and vegetables.

 

 Are you looking for additional talent to join ur team? What opportunities exist in your team for our readers.

Vigyan: Yes we are. In our team, we look for people fascinated by the rural India challenge (Opportunity) and willing to commit themselves to working out of rural setting for 70% of their working week.

We are also open to partnerships with other ventures in similar areas, to exchange best practices etc. I sincerely feel we still need more people coming into Rural space.

We are also exploring the crowd sourcing model now in terms of the actual payout (economics) we can offer to investors under this model. I hope to launch the model very soon. So maybe then all of you could own a small part in Sahaj.

 

Vigyan Gadodia From Banking to Dairy Farming

What prompts a graduate from IIT/IIM , excelling at a banking career to move base to rural India. To start his business studies afresh in some really challenging circumstances ? What challenges does one face in the drastic transition from a city based-corporate-salaried role to a rural-startup-entrepenurial one ?

Get some insights into these questions as Vigyan Gadodia shares his story and that of his venture – Sahaj. Vigyan is a MBA from IIM Calcutta and an engineer from IIT Delhi. He joined Rabo and then got deputed to YES Bank, where he was part of their early team. He was the first EIR at YES Bank when he started off his current journey. You can see his LinkedIn Profile here.


Tell us a little about your venture. What is Sahaj all about?

Vigyan: Our business is about creating sustainable and scalable businesses out of rural India. Key focus areas include

  • Agri & Dairy – We are starting with Dairy business and this will be the key focus area for the group to create a commercially viable business.
  • Tourism – This is a supplementary income source and a surrogate marketing tool to connect customers to agri producers.
  • Education – We have started with Primary education and this will be a sustainable business and a capacity building exercise in rural India. Rural Indians are willing to pay a premium for quality education.

That’s an interesting mix, can you tell us the story behind these verticals? Why did you choose these as your focus areas?

vigyan

Vigyan: For the first 5 years of our venture, we did anything and everything under the sun. Really, anything that came our way. For instance, we did agri-procurement, organic farming extension services, CSR services, agri BPO and a whole lot of other activities.

We also studied the technology and economics of different agri activities practiced by farmers. Based on all this learning, we felt (and still do) that integrated farming is the best way to create sustainable growth in Rural India. We started going into further depth of this and to model the specific individual business components like

  1. Cereals/ pulses & Vegetable growing pattern, market price fluctuations etc)
  2. Commercial tree plantations
  3. Dairy farming activity (to support natural inputs and provide daily cash flow to farmers etc)

We undertook a detailed SWOT analysis, identified the financials, and the set of competencies needed for each of the businesses.

In doing so, we realized that Dairy on stand alone is more compelling than any other business and can be the best starting point for the larger rural dream. Once dairy farming becomes the “cash cow” for a farmer, we can start extending the other components of integrated farming at individual household level.

Tourism came about because of our eco-system. We got a query from our NGO partner (Morarka Foundation) for help in hosting a student group from US in 2007. It was good fun, and we realized that it earned a very good return for the host farmer families as a supplementary income. We (Sahaj and Morarka) together decided to float an independent company to focus on developing products in Rural Tourism space.

 

Education is key to address many issues in the rural set-up. Around 2008, I was getting frustrated witnessing the callousness with which the rural youth treated their careers. A friend called from Mumbai and I was discussing the same with him and he suggested me to start a training school. I started researching the subject , trying to assess the rural education sector specifically and felt that the education system needed a more fundamental solution. The conditioning & basic learning abilities start at the primary school level and there is a significant quality (not Supply) gap in that area. So we started the school with a clear intention to make it a self sustainable school and are very close to achieving the target.

 

How did you move from banking to dairy farming? What really prompted this?

Vigyan: Somewhere in 2004, I felt that I had experienced the good parts of banking life. The comfortable life was not satisfying enough at a personal front and I wanted to challenge myself into something tougher (at an intellectual / operational level) . Hence I started reading up on social ventures and related areas. From then on, one thing led to another. I started microfinance in the bank in 2005 and in 2006 took the entrepreneurial plunge.

You spent a lot of time in Ringus in your early days of the venture, why so?

Vigyan: When I quit YES Bank, I only knew that I want to be in Rural India and develop businesses that can help me explore the “Demographic Dividend” offered by rural India. The first step was to find out where I can settle down. I started with doing a research on Hindi speaking states. Amongst them I liked Rajasthan the best to start.

I wanted to start from a place close to the major city. Ringus was (and is) a relatively prosperous belt close to Jaipur, so it offered a chance to experiment on new business models with farmers.


Watch out for the remaining part(s) of this interview with Vigyan Gadodia of Sahaj Group.