How Nilesh Parwani leveraged internet and lured Vistaprint into India
So you have started your own business just this week. You work out of home and you are the CEO, customer service executive and chaprasi rolled into one. What next? You want a set of business cards. Not too costly, yet classy.
The problem is that most large printers, who do a good job, print in bulk and the cards made by mom-and-pop printers leave smudge marks on the thumb. "You have to pay a minimum of Rs 8,000-10,000 to print cards or brochures on a good offset printer. It doesn't matter if it is 1,000 or 5,000 cards. It's about covering the cost of putting in the printing plates, running the machine for an hour," says Nilesh Parwani, MD, Vistaprint India. That's where Vistaprint comes in.
For Rs 475, anybody — lawyer, doctor, or even a student — can log into Vistaprint's site, choose a design template and place an order for printing 500 good-quality business cards. The Paris-headquartered company, with global revenues of over $1 billion, entered India in 2011, by taking over Printbell, a company that Parwani founded in 2007.
iBanker to Printer
Parwani, 31, knew he wanted to start something on his own after working with UBS and Warburg Pincus. He briefly considered paper trading. After all, his father and uncles were in it. It was around this time that Parwani decided to print the two books he had written on Excel modelling and usage. "I was clueless about how to get these books printed. Then I discovered that it was incredibly difficult. That got me thinking. Printing is such a basic service, why should it be so difficult?" recalls Parwani. That question was the genesis of Printbell. (Today, the books written by Parwani are part of the recommended reads of NMIMS and SP Jain Institute of Management and Research.)
Then Parwani did something that most of his peers in private equity found baffling: quit a cushy, paying job in a sea-view office to move into a single-room office to start a business that few people in India had tried before. "If you are a large company, thanks to your large volumes, you have no problems. But the question was: if I am a small-time guy and want to print business cards or brochures, who will I go to? If I go to the large or medium printer, I will have to get large quantities to justify his printing methodologies and costs. If I go to a local shop, it might be cheaper but I may have to compromise on quality," says Parwani.
The idea was that Printbell, based out of Mumbai, would leverage the internet to get volumes, and the costs of a high-quality printing job would be divided among customers. Plus, back in 2007, there was hardly anyone in the market who was taking online orders to print business communication (though there were a few companies offering T-shirt and mug printing).
Parwani took another call. He would not go after VC funding early on. "I saw too many entrepreneurs making the classic mistake of focusing on marketing even before perfecting the product or service," says Parwani. So he chose to start off with his own money and what he calls the "beggar of the street with an idea" approach.
See the Fine Print
After some initial hiccups, the response Printbell received was positive. Orders flowed in not just from India but also overseas markets like Dubai, Singapore and the US. "We did an order of 10,000 pens for a Dubai company. The great thing about Dubai was that you could ship an order at 10 pm one day and it got delivered the next noon," says Parwani. These orders paid off. "Our first order invariably was for $10 but the next order from overseas clients was in lakhs," says Parwani.
Luck played its part too. "A colleague of mine [from Warburg days] would often tell me how I was wasting my time in printing instead of working in the lucrative business of private equity. During one of these conversations, I told him about Vistaprint, a company that had drastically changed printing business in developed markets and was recording phenomenal growth," says Parwani.
The colleague subsequently went on to work for a hedge fund. His first recommendation was Vistaprint. During an investment meet with the management ofVistaprint (which was incidentally eyeing Asia), this colleague popped up Printbell's name. A few months later, in June 2009, the acquisition happened.
Wedding on the Cards
Since the acquisition, Vistaprint has got down its technology know-how and processes to India. It has also invested in a 50,000 sq ft printing facility in Bhiwandi. It has 50-odd people on its rolls. The corporate gifting space is another segment the company sees a lot of potential in. "Business cards are our magnet products where we are most competitive. However, we believe there is tremendous scope in printing personal products like key chains, calendars, USB drives or invitations for birthday parties and weddings in a young market like India," says Parwani. For now, the company is toying with the idea of opening kiosks and store-in-stores to get customers to experience the process of customising gifts.
Source : TV MAHALINGAM,ET BUREAU
Parwani did something that most of his peers in PE found baffling: he moved into a single-room office to start a business that few people in India had tried before.
So you have started your own business just this week. You work out of home and you are the CEO, customer service executive and chaprasi rolled into one. What next? You want a set of business cards. Not too costly, yet classy.
The problem is that most large printers, who do a good job, print in bulk and the cards made by mom-and-pop printers leave smudge marks on the thumb. "You have to pay a minimum of Rs 8,000-10,000 to print cards or brochures on a good offset printer. It doesn't matter if it is 1,000 or 5,000 cards. It's about covering the cost of putting in the printing plates, running the machine for an hour," says Nilesh Parwani, MD, Vistaprint India. That's where Vistaprint comes in.
For Rs 475, anybody — lawyer, doctor, or even a student — can log into Vistaprint's site, choose a design template and place an order for printing 500 good-quality business cards. The Paris-headquartered company, with global revenues of over $1 billion, entered India in 2011, by taking over Printbell, a company that Parwani founded in 2007.
iBanker to Printer
Parwani, 31, knew he wanted to start something on his own after working with UBS and Warburg Pincus. He briefly considered paper trading. After all, his father and uncles were in it. It was around this time that Parwani decided to print the two books he had written on Excel modelling and usage. "I was clueless about how to get these books printed. Then I discovered that it was incredibly difficult. That got me thinking. Printing is such a basic service, why should it be so difficult?" recalls Parwani. That question was the genesis of Printbell. (Today, the books written by Parwani are part of the recommended reads of NMIMS and SP Jain Institute of Management and Research.)
Then Parwani did something that most of his peers in private equity found baffling: quit a cushy, paying job in a sea-view office to move into a single-room office to start a business that few people in India had tried before. "If you are a large company, thanks to your large volumes, you have no problems. But the question was: if I am a small-time guy and want to print business cards or brochures, who will I go to? If I go to the large or medium printer, I will have to get large quantities to justify his printing methodologies and costs. If I go to a local shop, it might be cheaper but I may have to compromise on quality," says Parwani.
The idea was that Printbell, based out of Mumbai, would leverage the internet to get volumes, and the costs of a high-quality printing job would be divided among customers. Plus, back in 2007, there was hardly anyone in the market who was taking online orders to print business communication (though there were a few companies offering T-shirt and mug printing).
Parwani took another call. He would not go after VC funding early on. "I saw too many entrepreneurs making the classic mistake of focusing on marketing even before perfecting the product or service," says Parwani. So he chose to start off with his own money and what he calls the "beggar of the street with an idea" approach.
See the Fine Print
After some initial hiccups, the response Printbell received was positive. Orders flowed in not just from India but also overseas markets like Dubai, Singapore and the US. "We did an order of 10,000 pens for a Dubai company. The great thing about Dubai was that you could ship an order at 10 pm one day and it got delivered the next noon," says Parwani. These orders paid off. "Our first order invariably was for $10 but the next order from overseas clients was in lakhs," says Parwani.
Luck played its part too. "A colleague of mine [from Warburg days] would often tell me how I was wasting my time in printing instead of working in the lucrative business of private equity. During one of these conversations, I told him about Vistaprint, a company that had drastically changed printing business in developed markets and was recording phenomenal growth," says Parwani.
The colleague subsequently went on to work for a hedge fund. His first recommendation was Vistaprint. During an investment meet with the management ofVistaprint (which was incidentally eyeing Asia), this colleague popped up Printbell's name. A few months later, in June 2009, the acquisition happened.
Wedding on the Cards
Since the acquisition, Vistaprint has got down its technology know-how and processes to India. It has also invested in a 50,000 sq ft printing facility in Bhiwandi. It has 50-odd people on its rolls. The corporate gifting space is another segment the company sees a lot of potential in. "Business cards are our magnet products where we are most competitive. However, we believe there is tremendous scope in printing personal products like key chains, calendars, USB drives or invitations for birthday parties and weddings in a young market like India," says Parwani. For now, the company is toying with the idea of opening kiosks and store-in-stores to get customers to experience the process of customising gifts.
Source : TV MAHALINGAM,ET BUREAU
