Starting in 2006, iXiGo has grown to a 20-member organization in 2008. The company is expected to reach cash breakeven in May 2009, but it is still caught in the dilemma whether to expand slowly and steadily, or to invest in growth when costs are unusually low
Aloke Bajpai scanned the table of air fares on his mobile phone, comparing options and prices from different carriers. One benefit of being the CEO of iXiGO, the travel metasearch company he had co-founded in 2006, was his familiarity with every detail of his firm’s Web site that helped him find the best flights and hotels almost immediately when he traveled. iXiGO was a meta-search engine that aggregated travel listings from other sites, enabling easy comparison of travel options with a single search. By May 2009, iXiGO was approaching cash flow breakeven, and Bajpai knew he faced a major decision in the near future. Should the venture continue to grow organically, as it had since its birth, or was it time to raise more capital, spend more aggressively on brand-building and marketing, while perhaps even expanding iXiGO’s focus outside India? Bajpai was confident in his product and his team, but wondered what was the right choice during a global economic crisis: to invest in growth when costs were unusually low, or to conserve resources by picking the steadier, slower path.
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| The concept was to create a calm place with food, beverages and massage chairs where they could spend time when they were not working. When I talked to people in India, they were not receptive, and I realized that the idea was not scalable and had too many operational challenges. - Alok Bajpai Co-founder, iXiGO |
Aloke Bajpai’s entrepreneurial journey
Bajpai was born in Allahabad, but because his father worked for a bank that was among the first to have branches overseas, the family transferred to Kenya in 1987, where they lived for 4.5 years. After returning to India, Bajpai completed an electrical engineering degree at IIT Kanpur, graduating in 2001. He then moved to France to join Amadeus, a leading European travel technology company. “It was an absolute culture shock to move to France, adjusting to everything from driving on the wrong side of the road to telling people that you are a vegetarian and then having them offer you fish, on the theory that that's not meat,” he recalls. “It was really challenging to understand how French business works in the first few months. I learned a lot from how they are able to do things more efficiently in a small number of hours. But within four weeks, I asked my manager if I could work on Saturday or Sunday, saying I wanted to do more and was capable of doing more. He said he would need permission from his boss for me to work on Saturdays and added that if I worked on Sundays, people in the company could go to jail.”
By 2003, Bajpai realized that he wanted to have a more meaningful role in business than being a technologist. “I thought I would move on to start something of my own in India and I realized I didn’t have the business skills I needed or the international mindset that might be required, because today business is integrated globally,” he says. After four years with Amadeus, Bajpai left to begin business school at INSEAD’s Asia Campus in Singapore. He spent 16 weeks there, then eight weeks at INSEAD’s Europe campus in Fontainebleau, France, followed by eight weeks at the Wharton School of the University of Pennsylvania on an exchange program. He finished up in Singapore and earned his MBA in 2005. “INSEAD gave a level playing field to people from all sorts of backgrounds,” he remarks. “Not only do they teach you about the cultures and idiosyncrasies of various nationalities, but the amount of collaboration across school projects and extra-curricular work was astounding. In Indian business schools, I think there is less emphasis on collaborative work and more on lectures and examinations. I learnt a lot about different kinds of people across functions, industries, and cultures. INSEAD also allows you to be politically incorrect, so you are encouraged to question everyone’s ideas or beliefs as well as your own.” During an entrepreneurship course at INSEAD, one professor started his first class by waving a $10 note in his hand and quoting George Doriot, the founder of INSEAD—‘Without action, the world would still be an idea. “This phrase kept echoing in my head and I got up and grabbed the bank-note out of the professor’s hand,” Bajpai relates. “The professor was happy that someone got his point. That was my first lesson in entrepreneurship.”
Bajpai was determined to return to India and launch a venture. While he was in business school, he developed a plan for a company that would provide in information technology parks lifestyle spaces where technical professionals could relax. “The concept was to create a calm place with food, beverages and massage chairs where they could spend time when they were not working,” he explains. “When I talked to people in India, they were not receptive and I realized that the idea was not scalable and had too many operational challenges.” Bajpai decided therefore to join another company in order to build up his resources and get re-acquainted with India. “I hadn’t lived in India for four years and I didn’t recognize the new buildings and roads in Delhi,” he says. “I realized I needed to ground myself in India before starting a company.”
Bajpai joined a midsized company that provided enterprise resource planning software for the travel industry. The firm, FinalQuadrant, was located in Noida, but was setting up operations in Europe and the United States. As vice president of distribution and business development, Bajpai helped them set up a partner program and build relationships in the UK and the US. “I reported directly to the CEO, so I learned a lot about the start up environment in India,” he remarks. “I had a lot to learn, because this was the first time I had been in a sales role. Looking back, the best thing I could have done after earning my MBA was to join a small, growing company.”
Before joining FinalQuadrant, Bajpai spent a week after his graduation in Nice, France, where Amadeus is located. He had coffee with a couple of his former colleagues and they thought about what they might be able to do in India that would build upon their skill sets. They thought about an online travel agency; an inbound or outbound tour company; a GDS (computer system for searching, reserving and purchasing travel products); or a travel search site. At that time, Kayak, which had started in the United States in late 2004, had gained remarkable traction and had grown 12-fold in a year by providing travel meta-search, which allows users to search for travel deals across multiple sites with a single query. “I talked to a couple of people at Amadeus and we agreed that if this model worked in the US, it should work better in India, because the Indian market for travel is more fragmented,” Bajpai recalls.
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iXiGO emerges
By 2006, it seemed clear to Bajpai that the time was right for someone to start India’s premier meta-search company. “By the end of 2005, 12 airlines were operating in India,” he explains. “Makemytrip.com had survived the dotcom bust by operating at a low scale in the US and had re-entered India in 2005. There was news that a Harvard alum was starting an online travel agency named Travelguru and another INSEAD alumnus was getting investment for a travel portal called Yatra. With more carriers, agencies and fragmentation, the right ingredients were in place for a meta-search engine aimed at helping consumers find the best deals.”
In February, 2006, Bajpai left his position at FinalQuadrant to start a new company called Travenues, later renamed iXiGO. The new venture’s assets were an apartment in Gurgaon, three computers and a business plan consisting of ten PowerPoint slides. Two good friends from Amadeus joined a few months later and moved into the apartment. Jens Schütter, a German, became Product Head while Rajnish Kumar, also from IIT Kanpur, became CTO, with Bajpai serving as CEO. “For eight months, we woke up, brushed our teeth, sat at our computers all day, turned out the lights, went to sleep, and then did it all again the next day,” Bajpai reminisces. A few months later, a fellow INSEAD MBA, Dharmendra Yashovardhan, joined as COO, focusing on building partnerships. They hired one administrative/HR person and one developer in October 2006, and took out a lease on a very small office around the same time. To generate some cash during 2006, the founders also did product consulting and team building for another INSEAD alumni-led online travel venture, isango.com, an activities aggregator. “The isango experience taught us a lot about finding tech resources, building product teams in India and scaling up from three to twenty in a short time,” Bajpai remarks.
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written by RajVal, February 13, 2011
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