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Small and medium enterprises (SME) have often found themselves at the crossroads of banking giants and unorganised cash lenders, where they have had no option but to opt for the latter. But with the digitization drive, SMEs, too, have been inundated with banking opportunities. Even then, they don't know how to filter out the best from the mess. ADITYA TULSIAN, founder, Numberz is solving the problem for them.
Having worked with the SME sector for many years, it wasn't long before Aditya Tulsian, Baskar Ganapathy and Rajeev Chari got together to start their own venture, Numberz. "Baskar and I used to work together in a company called Intuit Inc, which is a global leader in accounting, tax and financial technology solutions for small and medium businesses. While working there, we had launched Quickbooks, an online accounting software in India and Asia.
In the whole process, we realised that especially in India, the real challenge lies in the day-to-day cash flow management. The real crux of it all is banking," said Tulsian. Numberz is creating a new age business bank offering for SMEs; it works on a simple premise: banking should be the catalyst to deliver higher growth rather than just being a separate stand alone activity. They are integrating business banking solutions in the day-to-day processes of the small businesses.
"The banks, so far, have done great innovations on the consumer side and the corporate side but the SME has been like a stepchild. It's that one place where the banks haven't figured out how to scale or give them tools without compromising on profitability. We spotted the opportunity there. That's how Baskar and I came up with the idea. Rajeev was building his own venture then. We would ask him if he would opt for the solutions we were looking at. He resonated with the solution so much, he joined us full time," said Tulsian.
He believes that both demonetisation and GST have been a big boost for their business. Over the years, they have seen many professionals turning into entrepreneurs and their focus is more on building the business rather than figuring out how to take care of the finances. This gave the trio the chance to swoop in and be their finance-in-charge.
"At one end, we had the new-age entrepreneurs who wanted to focus on their business and not finances and the other side, GST came in and helped us go after the businesses which otherwise had a few systems in place but were now forced to be streamlined," he said.
"Things like having to upload your invoices in periodic intervals means that you also have to create the invoices in a particular format. You have to ensure that your vendors are uploading their invoices on time," Tulsian further explained.
Their experience in the field gave them an added advantage, but they also faced challenges. The biggest one being finding the right talent. Tulsian also believes that for entrepreneurs another challenge is moving beyond the love for their own idea. "We need to have the passion but also take a step back and check ourselves from time to time," he said. Numberz has already bagged a major partnership with YES Bank. The number of small and medium businesses in India is huge. While it makes way for an advantage for Tulsian and co. giving them many opportunities to grow, but it also brings about a challenge - how to reach them.
"There is no single channel to reach out to SMEs. You have segments of SMEs that are online, second there are groups that you have to reach out through associations, third is through ecosystems and fourth is word of mouth. SMEs are a very small and tight community, one trader who maybe competing with another trader which actually go and recommend your solution to the other. If your product is good, they are the best people who will market for you," said Tulsian.
(This article was first published in the August issue of Entrepreneur Magazine. To subscribe, click here)