Bhat Dittakavi of Variance.AI on “Post funding challenges” by KK Jain of AnyTimeLoan (ATL) on 1st Feb 2018
The last time KK spoke a month ago, the crowd has got inspired with his high energy and clarity of thinking and a grand vision. It has been exactly a month since the investor’s money hit the bank. Till date, ATL got loan disbursements of Rs. 70 crores in 42 months. He has a tall order of hitting100 crores in disbursement in December 2018. He has eleven months left to meet his target. 
KK Jain
After raising the capital, everyone started kissing us now. Before they used to like but never ready to hug us. Now everyone is interested to go along with us. Post funding, an investor offered a commitment of two crores within two minutes without any condition that too at any valuation.
Next four months, we won’t touch any funds raised. We made fixed deposit of the capital we raised like we did with the angel funds. We want to make the business sustainable. Fundamentals of being frugal won’t change even if I have investor’s money in the bank. I moved the funds to fixed deposit from my current account so I don’t have any temptation.
We crossed 70 crores in 41 months. We are a peer to peer lending platform. We allow people to take loan any time on demand.
We want to have physical presence in 17 markets. My investor Spice got 72,817 physical outlets and we want to leverage them. We got eleven hires  starting tomrrow. I want to save every penny as a principle so we took some time to lock in one plug and play office. It would cost Rs 58 per sft but we are getting at Rs 43 without compromising on quality in Gachibowli. “8 + 1 month” deposit is typical but we negotiated it to “2 + 1” month.
I was there at SFO in Uber Exchange program for seven days. Back to the game. Last three weeks have gone into post-closing formality. For a startup, it is unknown territory as whatever we submit to regulatory authorities can’t be edited again. Post funding, you have to spend time and ensure your MCA, ROC and RBI compliance are in place.
So far I put a clause in the contracts that would end up investors pay the angel or other taxes if any rather than the founders. Book value of Startup is anyone’s game. Because of my ten years of financial experience, I understand the legal terms. I haven’t invested in a legal council for the deal as I wanted to close the deal very quickly.
Post funding, I still work seven days a week. I leave after midnight. I wish founders here work 7 days a week and 24×7.
We have been meeting and targeting knowledgeable and tech savvy customers. Now we have to reach the common crowd and also the bottom of the pyramid. Bottom of the pyramid guys may not default as much as you think. As we put food in their mouth, and they will be loyal to us and won’t default.
Ours is a paperless, contactless and presentless system.
What is the deal?
A commitment of $4 million investment we got out of which we called in two million. We don’t charge the lenders and borrowers upfront and we get revenues when the lender makes his money. Only after our investor sees returns, we will see money.
Q) How competitive are you?
I don’t burn my pockets to fill someone’s pocket. I charge you premium as I get you money when you really need it. We are the costliest product but  also the fastest. Two years down the road, we could be cheapest with scale. By 2021 when we target to get listed, we will see ourselves in the cheapest zone.
Q) What is your customer acquisition strategy?
We don’t have a Facebook page and Twitter handle. We don’t have Google marketing or Linkedin either. This is purely the power of money that pulls in customers in need of fund. From mid this year, we want to speed up our marketing effort. We never did paid or offline marketing.
Borrowers keep coming to our environment. We do curation and if they are through, our system automatically selects a lender.
Q) How does lender pick a borrower?
Any peer to peer is a market place of discovery of both the parties on either side. When a lender sees borrower profile, lender chooses the quantum and  borrower and we don’t let the lender do this in our case. Our algorithms pick the lender. You have five minutes to click.
As a lender, you have to give a consent in five minutes else your internal rating goes down. Money flows from the lender to the borrower via escrow and the reverse. As a platform I don’t touch your money. 
Platform decides the rate of interest every six months as borrower doesn’t do rate discovery as he wishes. We want lender to invest minimum one lakh and a maximum of ten lakhs. Interest rate is a function of risk, cost of servicing, cost of lending and demand and supply.
Q) Why is the limit of ten lakhs?
It is a guideline by RBI. Ten lakhs limit is to protect the skin of retail lender.
Q) Any hiring and culture challenges?
A) I gave freedom to my HR head to bring anyone who runs and delivers faster. I asked the leadership team to be the ones who give their 24×7 time next eleven months even if it is at the cost of family. This culture perforates down. We got to hit 100 crores disbursement and if it happens it is a tsunami that runs on its own.
Uncertainty of getting the customers is solved. We keep getting them.
We shall have 80% of the team by April and then give them three months for the training and then the real journey starts.
I started my negotiations with investors at 3% for stock option pool and ended up at 5% as stock option pool.
The transformation has to happen from Rs. 70 crores in 41 months to Rs.100 crores in 30 days of December 2018. This is a tall order and I am chasing it with focus.
I am the office boy for the company and every credit my team mates and leadership team shall take. I don’t like anyone in my company being called employee.
As a lender, how do I make my money?
Lender churns his money 14 times an year as average loan duration is 28 days. I educate lenders. I don’t believe in paper advertising. I believe I shall transmit the energy from my soul to yours. I charge 15% on the interest you make as a lender.
I need to have five lakh application to get a lakh shortlisted. Average loan is Rs 12000. I need 10000 lenders giving on an average Rs. 3 lakhs.
Today’s position: Supply commitment of Rs. 17.3 crores and 47000 registered borrowers.
Q) What is the approach to take in financial world?
Financial services is a calculated and qualitative mechanism. Only the future differentiates men and boys in financial services. Men know risk mitigation and growth. Rush of blood from Economic Times back fires. In financial services, you have to make money so you can make money for others. Flipkarts are asset lite or even there is no asset except for high end computer servers. People will be ready to pay extra price because of the busines model we have established. I can vouch I will never run bleeding business. I don’t believe in being visible to my customers.
Q) Do you lend to MSME businesses?
We do. Rs.10k to 1 lakh upto three years.

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