Andrew: Hello Freedom Fighters. I’m the slightly congested but still present in and still very active founder of Mixergy.com which home of the ambitious upstart. Yeah, you can hear by voice I’m recovering from a cold. And you know what, one of the surprising things that I’ve discovered is that some of well-known companies here in Silicon Valley actually don’t do all of their own coding. They don’t do all their programming.
Today’s guest runs a company that built mobile apps for Sidecar, Hipster and many other highly regarded Silicon Valley. I invited him here to talk about how he built up his business by building up other companies products. His name is Sunil Kanderi. He is the founder of Mokriya. It’s a mobile solutions and strategy company based in California. Hey, Sunil before I do my sponsorship spot. I don’t think I did your company justice. Am I pronouncing it right? Mokriya.
Sunil: Yeah, it was perfect.
Andrew: Okay. Good.
Andrew: And this interview was sponsored by Toptal. If you’re looking for the right developer to come in and work with your company. Not just one that knows the programming language that you’re using. But also the environment that you like to work in. I urge you to check out Toptal. That’s the company that I use. T-O-P-T-A-L. And their Network of elite prevetted software developers. People who’ve been proven to be in the top 3% among their peers globally.
So you tell Toptal what you’re looking for, they will search through their network. They’ll find candidates that have been tested. They will interview them and they will present you with the top one or two people so that you can talk to them if you like them. If they are good fit for you. You could hire them and often they can start the very next working full week or part time. Even if you just need a few extra hours a week, they’re available to you. It’s all guaranteed if you go to Toptal.com. Sign up, check them out and tell them Andrew of Mixergy.com sent you. Toptal. Sunil welcome.
Sunil: Thank you Andrew. It’s a real pleasure and privilege.
Andrew: It’s an honor to have you on here. I had no idea how much . . . just how much work have you done. Sidecar. I’ve used their app to call up drivers to pick me up I don’t own a car. How much of their app did you build?
Sunil: Well we built another version 1.0 of the driver set app.
Andrew: And what did 1.0 of their app do?
Sunil: The functionality is the same as it is today. They might have undergone some design changes and stuff. But when they were launching, this was back in 2011, we built their first version of the driver set app. And we actually helped tons of Silicon Valley companies like Threadflip, SimpleGeo, Hipster. We worked with Glassdoor, LegalZoom. A lot of these companies.
Andrew: What did you for SimpleGeo?
Sunil: So it’s actually an interesting story. SimpleGeo in some ways actually put us on a map, Joe Stump, he was the Chief Architect of Digg and he also was a CTO of SimpleGeo.
Andrew: And Joe Stump is highly regarded, very well known in the tech community. He’s somebody that other developers look up and admire.
Andrew: And trust.
Sunil: Absolutely. So he . . . I think it was a Twitter message saying he was looking for a rockstar and iOS developers, some form of that. I just reached out back to him. He invited me. At that point he had a company, it was simply forming. So he invited me to his office. And I basically pitched him. He was looking at that point, SimpleGeo was building an iOS, Android SDK and they were short staffed. So I told him, “We can continue building the features for that iOS SDK and Android SDK, and also making it.” So I was doing iOS work. My brother was the CTO he was doing a lot of Android work. He really liked us. He loved the work that we did. And then he actually put us on a CTO list at the venture capital firm that he was . . . which was funding.
Andrew: What you mean that he put you on a CTO list?
Sunil: I think they have an internal list. This was [inaudible 00:04:24], so they had an internal list where they actually communicate with each other. So he just recommended us saying, “Hey, this is a company that I’ve been working with. And I’ve been very happy with them.” So based on that he actually kind of hooked up us with PAT, HomeRun, a lot of other companies. We did some Blackberry work for PAT. HomeRun, it was a Groupon clone. Basically, getting to the point, he actually put us on the map. A lot of tech startups started to reach out to us after he recommended.
Andrew: Let me understand how you do this. How you get to a point where you could be the guy who builds the apps for the people who are so highly regarded and well known here. And frankly you’re building a successful, profitable company doing it. No outside funding. All boot strapped, all yourself. Lets see how you got here. Before we even get to the business, I want to understand the man. You’re a guy who grew up in India. What was it like to grow up in India for you?
Sunil: For me it was . . . I come from a middle class family. It was pretty good. My parents, my dad he was the first person to graduate from his village. He went on to get his masters degree but he still goes back to his village and stuff. But I myself had a decent middle class life. All my education was in English medium schools. But then by the time we got to 10th nearing college we had some reversals unfortunately, some of the notes that Jeremy had, we touched upon on that.
Andrew: You talked about it with Jeremy in the pre-interview.
Andrew: What you told him was 10th grade, you and your family had financial trouble. Is it tough for you to talk about today?
Sunil: Probably. There is a lot of it. There’s a lot there but the basic point was that it was some reversals of fortune because my father’s business had some setbacks. That actually gave me some grounding in the sense that not to take anything for granted. Work really hard and . . .
Andrew: Because that felt like at any moment something could be taken away from you. You know what? I had a similar situation. My dad was also an entrepreneur. And I knew as an entrepreneur the whole thing could go away like that. So when I would see my friends write on their notebooks on school or their loose leaf binders, I never would write on the outside because I said if things go bad, I might need to use this binder again the following year. And I don’t want everyone to know that it is the same one that I had my first and second grades. I don’t want any of that old stuff. I wanted it to look or at least feel a little bit like its brand new. And so that is a sense of instability a little bit. A hunger. It makes you feel like you have to prove yourself every day.
Sunil: Yeah. You hit it on the spot. I think actually that develops a few of those in you.
Andrew: What did it do for you today? Do you watch pennies in a way that other people don’t? Do you watch the expenses at the office? Give me example of that.
Sunil: I mean even today I don’t have an office manager. We don’t have a proper HR person. We are about 30 people. We have developers across the world. Even across US we have. . .
Andrew: So you’re not going to spend money on an HR person, even though you have that many developers.
Sunil: I mean I should probably do it at some point. But since the company itself is boot strapped, its an expense that I find hard to justify at this point. I mean I think we need to do it pretty soon.
Andrew: How about another one? Give me another example of how your dad’s setback at the 10th grade is affecting the way you think about money today, in the way you thought about starting a business when you launched?
Sunil: I think one of the things for me is . . . I don’t see it as [inaudible 00:08:37] when we make big deals and we make a lot of money. I don’t see it as, okay, I’ve hit the mark. My perspective is, we want to build a long term business. I want this company to last 10, 20 years.
Sunil: So I think I’m more equanimous, big wins or big losers, doesn’t bother me as much. I just take them in stride.
Andrew: I see. Then you go on. You graduate from your school yourself. You end up being a software developer. Working on enterprise. You come to the US, right?
Andrew: You get your Green Card. And as soon as you get your Green Card, what did that make you think about your job?
Sunil: I mean the job isn’t attractive anyway. The first instinct was, “Hey I wanted to do something.” And I actually moved here. Moved to US in ’99. By the time I got my Green Card, it was 2007. And in 2008, I moved to Silicon Valley. And the first thing, I started discussing with my brother, “Hey, we need to do something.”
Andrew: Because when you have the Green Card, before you had the Green Card, you’re stay in the US is dependent on the job that you had. Right?
Andrew: Once you have the Green Card, you’re welcome to go, start your own company, float around as you’d like. Right? You say immediately you call your brother, why your brother? What was your brother doing at that time?
Sunil: He is a great software developer. He was a chief architect. This is back even before smartphones were invoked. This was back in 2004. I use to visit him in Phoenix and he would be driving around. He had this old flip phone. AT&T Nokia phones. And he’d get driving directions, turn right, turn left, as an arrow. This was software that was not ever released. He built a product for . . . he used to work for Motorola. And he was the chief architect on this. So they built this product called “ViaMoto.” Later GM acquired them. A lot of the software they build actually powers OnStar.
Andrew: What did the software do before GM bought it to power OnStar?
Sunil: I think it was an internal project for them. It was turn by turn navigation system that they were trying to build.
Andrew: I see. So it wasn’t released out to the public, he had it because he worked on it. And it was turn by turn directions. And then it was bought out. It was part of OnStar system. He also had an app that appeared on the first Nexus homescreen. Right?
Sunil: Yeah. This was . . . I think it was in 2009. This is when the idea actually crystallized for us because he said, on an internal family email he said, “Hey, the app I worked on? Its going to be on the homescreen of Google Nexus.” And then we started having discussions. And I was like, “What does it take?” I use to work on enterprise software but I didn’t have the iPhone or Android developments that he had. And I was like, “What does it take to build an app?” And he started educating me and we should do it for ourselves. We’re doing all this stuff for all different kinds of companies. Why don’t we do it for ourselves?
Andrew: When partnering up, what was his app that was on the homescreen of the Nexus phone that Google released?
Sunil: I think it was, at that point he was actually working for Trimble Outdoors. It was a GPS navigation app.
Andrew: Wait. Didn’t the Nexus have its own navigation through Google Maps or it had that plus it had the other one?
Sunil: Yeah. They use to do a lot more. I don’t think it was a simple navigation app. They use to do geo-caching. A lot of other features on it. I don’t exactly remember the details.
Andrew: But you do remember though it was, hey, this is cool to be able to create an app and see it on so many people’s phones. Why are we doing this cool stuff for other companies? Why don’t we partner up and do it for ourselves? Did you quit as soon as you had that realization, as soon as you got the Green Card and knew this is your direction? Or you waited a little bit?
Sunil: I did wait a little bit. I think I quit as soon as I got our first client. I actually went to my boss and said, “Hey, I’m actually quitting.” He was like, “You’ll come back in three months or six months.” And he’s, “I don’t want to rehire you.” And he was, “I want to keep you on the payroll.” So he would actually pay me 20% of my salary. He said, “Don’t come back to work. You don’t need to come to work, but I still want you to be on the payroll so I can rehire you.”
Andrew: Because then its easier to bring you right back in.
Andrew: Interesting. So you’re still making 20% of your salary? This is UC Berkeley.
Andrew: That’s what happens when you work as part of the university system.
Sunil: I did . . . back then I did a lot of infrastructure upgrades and things like that. So he wanted somebody that can actually troubleshoot if something goes wrong.
Andrew: Okay. So you were also on standby in case something goes wrong, they’re going to call Sunil. And Sunil going to fix it.
Andrew: All right. So one of the things you do is you go and you read the book to learn about iOS development. What is the book for you?
Sunil: I think it was called iPhone . . . Beginning iPhone Development, this was 2009. So the first contract, pre-interview I was telling you the iPhone app dev code. I don’t think that website even exists. So this was for a realtor company called “Real Estate Bottom-line.” So I told . ..
Andrew: So this as your first customer?
Andrew: How did you get this first customer?
Sunil: I just Googled and I just found a lead gen company. And basically you had to pay couple hundred dollars for every lead they send. I spend some money but got a few leads and this one worked. He had really good desktop apps. And he wanted to bring them to mobile.
Andrew: All right. That’s a pretty good deal, 200 bucks. Do you end up getting the client from it?
Sunil: I think I paid for more than one lead.
Andrew: I see, right. So this one worked out.
Sunil: Worked out.
Andrew: How did you know that you’re ready to work on his project?
Sunil: First I got the requirements from this guy. I saw the app and I knew we could build this. I talked to my brother Pranil. And he was like, “Yeah, we can do this.” And he was still working at that point. I quit my job first. And yeah, I read that iPhone app developer from cover to cover. It took me three weeks and then we started developing the app. But interestingly by the end of developing that app I realized that I needed more help. So we did our first hire.
This was a guy based in India, he was in Kerala, Mohit. He’s still with us. I saw him on some . . . I think it was on GitHub, I forgot where. I sensed he knew what he was doing. So I reached out to him. He was our first hire. And since then that model has actually worked out. We find the best talent wherever there is. We tried to initially pay at work with these really cool startups. I tried to hire developers here. It’s way too expensive. It’s hard to actually attract them for . . .
Andrew: He works where for you?
Sunil: Yeah, in Bay Area.
Andrew: What part of Bay Area?
Sunil: I’m in Cupertino.
Andrew: I saw that really is a hard place to hire. And so you said, “You know what, instead of placing a help wanted ad, what we’re going to do is look online to see who is active, who is smart, who knows what we need help with. And we’ll go and recruit that person. And that was your process. So how much were you paid for your first project?
Sunil: That project I think at the end we got close to 20k.
Andrew: And before you even got that money, that 20k, you were willing to quit your job. Because . . . and the surprising thing is that’s not enough for you to live on for long time especially not if you plan to split with your brother. If you eventually end up hiring a developer. So what was it that made you say, “All right, I’m ready to quit, I’m ready to go all in.” How did you know that there would be enough money?
Sunil: I think part of it was . . . yeah, I just took a leap of faith. But I also wanted to. I was looking at mobile. I think that year AdMob was sold to Google and the AdMob venture firm for was actually doing a celebrator gathering for AdMob. So I actually attended that meet-up. And I actually sowed some of the seeds that I thought mobile is going to, there’s going to be a tectonic shift, computing as we know it is going to completely change. Everything is going to happen on mobile or touch devices. The phone factor, the desktop and laptop factors are going to go away. So I wanted to be a part of mobile.
Andrew: I see. So it wasn’t so much you got this first client. It was that you knew it was the future. You knew you were capable. And yes the new client helped confirm that you’re going to do okay. Or helped you feel comfortable that you’re going to do okay there. There is no confirmation.
Sunil: Yeah, it’s just the validation that . . . there’s need for this kind of service.
Andrew: Where did you go to buy lead? What I’m finding is from people who listen to me, is they like to hear specifics. Is there a place that you recommend? Or do you remember the place, you got that lead?
Sunil: I think iPhoneappdevquote.com
Sunil: Quote. Q-U-O-T-E.
Sunil: Yeah. But I don’t know if it’s still there. I haven’t used it in the last . . . I used them initially. But yeah we now have sales team.
Andrew: Yeah they are still there. Frankly they look a little shady. Doesn’t look like the most . . . maybe shady isn’t the right word. But doesn’t look like the most developed site itself. iPhoneappquotes.com that’s what I see. And so the thing it tells me is if you go on a site like this, you’re completely disconnected from the app world. It’s not like you have friends in connections and people who are building apps, number one. And number two, you must have not liked sales enough to start making cold calls. You must have just said, “All right, I’ll pay some money.”
Sunil: Yeah, I’m not a natural salesman for sure. We hired a . . . about a year back we brought on some full time sales help. But before that I use to do that . . . I’m actually good at pitching. When I go and meet CTOs, I can talk their language. I can give them confidence. But cold calls and stuff, yeah.
Andrew: To get to that person is not your thing.
Sunil: Not my thing.
Andrew: Okay. So that’s how you got your first customer. How did you get your second?
Sunil: I said I met Joe Stump on Twitter, I found him on Twitter. Responded to his tweet and went and met with him, since I was here in Bay Area. And then that started the ball rolling for us.
Andrew: Do you remember what you said to him before you met him in person that got that in-person meeting?
Sunil: I think I said, “Joe, we have a team, we can help you.” And the team was me and my brother.
Andrew: I see. And that was it. Because there was no getting away for communicate credibility was there?
Sunil: I think part of it was I kind of showed some of the stuff that Pranil did with Trimble Outdoors. We had a lot of GPS experience. When I said we, actually Pranil since he did the ViaMoto and then was working for Trimble Outdoors. Forgot the name of the company he was working for when he quit. I can’t remember.
Sunil: Anyway . . .
Andrew: You had enough, or your brother had enough, experience that it would be enough to get a meeting with Joe Stump. And then once you get in with him, do you remember what you said that convinced him?
Sunil: I think I showed him some of the apps that we worked on.
Andrew: Even before you built your own. You’re showing even the apps that your brother worked on for another company.
Sunil: And we had a realistic bottom line. I think we had a couple of really small apps that we built just to showcase.
Sunil: So SimpleGeo was also building location infrastructure stuff. So GPS capabilities and things like that for awareness. Those are areas that they needed help with. So the skill set kind of was a good fit.
Andrew: Okay. So how do you know what to charge him?
Sunil: At that time I guess I didn’t know. So it was like they tried to $70 to $75 an hour.
Andrew: How much was it?
Sunil: Seventy to $75 an hour.
Andrew: Seventy to $75 an hour to get the two of you guys who were experts at this? Who were in the US? Who doesn’t have to communicate with over Skype, you can actually sit and have coffee with?
Andrew: So in retrospect, you really underpriced yourselves.
Andrew: I see.
Sunil: For the first year and a half we did underprice ourselves. But we were also looking . . . our main criterion was we wanted to do good work, build great apps and build credibility.
Andrew: Okay. Your brother’s company, the one that he worked for, called Trimble Navigation. He was the lead mobile developer there.
Andrew: That’s where he was. That’s what gave him the experience that persuaded Joe Stump. How long did it take you to produce your first piece of solid work for Joe?
Sunil: I think in the first few three to four weeks we . . . there was also some maintenance work, some features that needed to be added. We were able to produce in the first few three to four weeks. Solid work.
Andrew: All right. So if we’re going to talk about how to get first clients and pass on some of your experience to other people, the most valuable thing is be around your customers, it seems like what worked for you, right? Have experience even if it’s working for someone else, we tend to undervalue what we did and we worked for a company and overemphasize the work that we do when we’re building it for our own business. But in your experience, what your brother did at Trimble helped you get other work afterwards.
Sunil: Absolutely yeah. I think being at the right place. Part of it is also luck, me is looking at Twitter, and seeing Joe Stump, him taking a chance on us. But I think for me what has worked out is being persistent. I never gave up. Because there were days . . .
Andrew: Why was it persistent? When were those days? It seems it worked out pretty nicely. You come out, you buy a lead from a site that I’ve never heard of before. You suddenly get a customer. You then find Joe Stump on Twitter. Where did you need to be persistent in the beginning?
Sunil: I think it’s a story in retrospect. But before I got that first quote or the first lead or even before I convinced Joe Stump, there were days where I need to . . . I actually did some cold calls too. List of companies, that I just cold called. And I was, “This is never going to work.”
Andrew: Why didn’t it? What were you like on those calls?
Sunil: It’s not just about the calls. It was just a tool for us and this . . . I use to see other app development companies, and I was like, “This is never going to work.” Why would somebody hire us instead of XYZ that has a great website, tons of developers. But just being persistent, I think doing all the right thing, things will fall in place. And you also have to be lucky.
Andrew: You’re saying that you stuck with it even when you’re making the sales calls. And the sales calls didn’t let work. You stuck with it even when you were getting some early leads and they didn’t translate into sales. And you still had the guts to go in Joe Stump and say, “I think we can work this out.” Even though you didn’t have a track record with your business yet. Or it sounds you didn’t have a real website yet.
Sunil: I think we had a real website but the point you mentioned, having the guts to actually go there and tell. Yeah, its true because I was hesitant. I was like, “This is a great technology company.” They were ranked . . . in 2011 they were ranked one of the top startups to actually watch out for. This is top technology company and do we even have the capability to do it.
Andrew: What does your name mean, Mokriya?
Sunil: Its a play in a Sanskrit word. Kriya stands for action. Mo is short form for mobile.
Andrew: So mobile action. And in the beginning you said, you were willing to do Amazon Kindle development, iPad development, Blackberry development, Android and of course the iPhone. You just said we could do it all because you figured you could learn it.
Andrew: Interesting. All right. So you get your first customer. Do you need to start hiring people to work with SimpleGeo?
Sunil: Yes, yeah. We needed to hire people. Like I said earlier, one of our biggest hurdle was to actually . . . I mean we still do rigorous technical interviews. I think one of the hallmarks for us is we actually were able to hire really good talent. So what I saw initially were the people that we wanted to make offers for, they wouldn’t take our offers. But we’d soon get some people that we can actually work with. But we really wanted, really good talent. So couldn’t do it here in Silicon Valley. So one of the first hires was in Milwaukee, Wisconsin. He is actually now is a CTO at a funded startup. So we just said that this talent across . . .
Andrew: How did you get a CTO of a funded startup to come to you?
Sunil: He’s now a CTO.
Andrew: Okay. He’s now.
Andrew: So when you found him, here’s one thing that you told Jeremy about your hiring process. You said, its very stringent. We really make people. We really do a lot of research before we find someone. We make sure that they’re the right fit. That’s important to us. Where they are is not as important. We’ve hired people in Serbia, Argentina, Israel, UK, India and across the US. So what is this hiring process? Is it still you look online for people who are doing interesting things, and then you court them?
Sunil: Right now we actually go beyond that. I mean we put ads on places like [inaudible 00:27:44]. So coming back to that point, the first hire was in Milwaukee, Wisconsin. I think I found him on Hacker News. I saw a couple of comments from him. And I thought, “Hey, this guy looked awesome.” He was just graduated. He didn’t even finish graduating. But he was fantastic.
Andrew: What about him that told you he’s fantastic?
Sunil: Just the work that he did. He was not even an iPhone developer, he had some Mac development experience. And we hired him because we had . . . we needed some HTML stuff for Blackberry World.
Sunil: So this was back in the day. And he delivered it. And then I said, “Hey, you have Mac development experience, how about you actually work on this iOS app?
Andrew: I see, so one of the first things that you did was you tested him with a small project before you even hired him.
Andrew: I see. Okay. And do you test him before you even test him with the small project? Is there something else that goes into it?
Sunil: We do paid programming.
Andrew: Walk me through the whole process, start to finish so that we could learn from you because you are hiring really strong people and frankly hiring at all, developers is really tough. And convincing them to leave their work and come to work for you, is really tough. So beginning to end. What’s the process?
Sunil: Okay, cool. I mean the first process . . . first step for me is I interview them. Couple of things that I look for in developers is for them, it should be more of a craft rather than just a job.
Andrew: How can you tell? What do you ask in an interview that shows that it’s a craft for them?
Sunil: These guys have side projects. They tinker with stuff. A lot of them what I found is they don’t come through the traditional process. They are self-taught or they stumbled on it. So these things, the side projects, being up on different technology stacks, just having a conversation with them. It’s easier to sort of . . . if this is just the job for them.
Andrew: Do you have a few questions that help tease that out?
Sunil: My interview is definitely a lot open-ended. I just dig into that background. I ask them what they’ve done before, basically diving down, drilling into some of these specific projects and asking questions about why they did it this way versus that way?
Andrew: I see. Why they did it? What they’re, how they worked, what they produced themselves. You want to look at side projects because side projects tell you that they loved it so much that they are doing this even in their spare time. Are you looking for anything else?
Sunil: I mean the side projects are not absolutely necessary even talking to them over the projects that they did for companies. There is a lot of information.
Andrew: Even that’s enough. What about this? How do you even get them to talk to you? Just because they have a project online, doesn’t mean they wanted to be recruited to go work somewhere else right? One of things that you see on Hacker News a lot is people saying they hate recruiters.
Sunil: Since I am the founder, one way it’s easier. I don’t start the conversation like, “Hey. Do you want to work for me?” I start the conversation if it’s relevant to what their discussing, I discuss that and ask them, “Hey what’s your background, what are you currently doing?” And then ask them “Hey, would you be interested in talking to me about this stuff?” So yeah, it is a gradual conversation.
Andrew: And by this stuff you mean about a job or do you still talk to them about first projects?
Sunil: Depends if I have projects, I talk to them. If I find somebody really talented that I think would be a good fit for us I just say, “We might have a job for you,” but we still never skip the interview process. I have to talk and then Pranil has to talk. We have a couple of other team members to talk to them, there are some coding exercises, not necessarily puzzles or anything. We just take a simple task, have them do the coding.
Andrew: And then you look at it.
Sunil: Look at it.
Andrew: Have you ever said yes to someone and your brother said no?
Sunil: Yes and those turn out to be a mistake.
Andrew: He made a mistake you’re saying.
Sunil: No, no I.
Andrew: Oh you made a mistake, what did he catch that you didn’t catch?
Sunil: I mean he is a lot more technical then I am. For me I think it is, if somebody is very convincing . . .
Andrew: You are more likely to fall for it and he is not.
Sunil: He is not.
Andrew: I see, all right, I see how you are hiring them. What about, how did you get the next set of clients?
Sunil: I think a lot of it was word of mouth. So initially we worked with a lot of tech start-ups and then word of mouth. AT&T actually called and they have a group here in Silicon Valley called AT&T Foundry, so they actually out of the blue called us and I actually went to meet with them. We did some projects for them for Connected Car, smartwatches. SanDisk is a big client for us, we actually launched a product for them called iXpand.
Andrew: I know that AT&T just found you probably because they heard about you from somebody, you don’t even know who it was. But you didn’t know, it’s something like that and they contacted you, they vetted you and they hired you. What about SanDisk, how did SanDisk find you, how did you find them?
Sunil: A product manager from SanDisk reached out to us.
Andrew: How did they know about you?
Sunil: I think, so in 2013 we actually launched an app, an internal project called Mokriya Craigslist. So we said that Craigslist is about 10 years old or 15 years old, just to see if blue links on a big web page, if it was mobile first company that was started today, how would a class for apps look like?
Andrew: And you said we want to make that?
Sunil: Maybe we want to make that.
Andrew: Did you start calling up Craigslist and asking them if they could hire you.
Sunil: Yeah and then, no we didn’t ask them to hire us but we said . . . at that point they were actually shutting down third party developers that were doing stuff on top of their data. So I asked them for a licensing agreement. I said, “There is ton of data that you guys have. I want to build a first class mobile experience.”
Andrew: And license it instead of just using it. How did you get through to them? That’s a pretty interesting story?
Sunil: In blind emails, I email the CEO, at least four or five times. The fifth time he got tired I guess, he routed me to their legal department, and then I spoke with the legal department and they had a legal agreement and we started. That actually got a lot of press for us and Wall Street Journal covered us.
Andrew: And you guys were going to, yeah I saw that the Wall Street Journal covered you for this. You guys were going to build it and pay them a licensing fee every month?
Sunil: It’s every year.
Andrew: Every year? What is the financial structure? What do you pay them every year?
Sunil: It’s 15% of the revenue that you make.
Andrew: So no revenue, you don’t pay anything.
Sunil: There is an opt for a minimum cost, I think it is $3000.
Andrew: That’s it? That’s pretty good deal. But it does also mean that you basically . . . you could potentially be giving up, I don’t know, I was going to say you potentially are giving up 15% of your revenue roughly because Apple takes 30 and then they take 15.
Andrew: Okay, so you start building it. How do you know what to build? Do you do any customer development or do you just start going?
Sunil: We didn’t do customer development, initially it was product, and it was product ideation in terms of how can we build a really compelling mobile first experience for this market basically classified. So we actually came up with different types of concepts, then we started building it. Once we started building more of a prototype, we started testing it, we went to Starbucks, we heavily tested that.
Andrew: Instead of showing it to people and having them use it.
Andrew: Okay, where was your revenue going to come from. By the way, I have the app here. It’s hard for me to show it on the screen but I will try. There it is, right. Where is the revenue coming from for it?
Sunil: There is an in-app purchase, but right now we actually made it entirely free because we were not making any money. So we just said it’s more of a branding exercise for us at this point.
Andrew: Okay, I like the way the, I don’t know if I can actually show it, but the way that items fly in is pretty cool. So you spend some time both building it and talking to customers about it and then you finally launch. How many weeks into the project do you launch?
Sunil: It took us about four months.
Andrew: Four months of work?
Andrew: How much time does your team spend on it?
Sunil: At least two devs, we did a lot of designing.
Andrew: Full time?
Andrew: Wow two full time devs working for four months, plus design work, plus your time and then you launch it, the Wall Street Journal covers you. How did you get the Wall Street Journal to cover you?
Sunil: We actually hired a PR firm.
Andrew: Okay, so you are even hiring a PR firm for this? Okay.
Sunil: So they reached out and they, basically back then that, I mean right now it’s not the most innovative app, but back when we launched it in early 2013 it was really amazing. We came up with some new design pardigms in terms of how to not get the app . . . within two taps you can actually change the category, everything that can be done in the app, we tried to do it within a couple of taps. And also that idea of Craigslist and how we did it. I mean it was 10X improvement, we came up with design innovation and Craigslist is not known for design innovation. So that I think helped us, Wall Street Journal at the time, lot of techs picked up on that. And that also, that is the second level of actually getting our name out there.
Andrew: I see. The Wall Street Journal articles starts with “One of Silicon Valley unsung heroes has a new tune; its own.” That alone is almost worth all the money that you spent on PR. But it then goes on. “Mobile app design company Mokriya, the low key 12 person company that quietly designed all or some of the iOS, Android and Blackberry apps for Sidecar, Hipster, SimpleGeo and Threadflip has launched its first independent effort.” So right away they’re telling the world, this is the company you have never heard of but actually is doing a lot of work that you have seen.
Andrew: Okay. So then you get all that credibility, you launch and then what happens to your app?
Sunil: It doesn’t go, I mean.
Andrew: It doesn’t go anywhere.
Sunil: Yeah. It’s a typical startup. You’d see it, it is a big launch, there is a lot of activity and then you realize, hey you cannot really make money out of this.
Andrew: Why not?
Sunil: There wasn’t enough downloads to make that happen. I mean right now we have a million downloads but the 99 cent, one time, I think they can not fix what doesn’t work.
Andrew: It was one million downloads for free and then how many of those were upgraded.
Sunil: Probably 10%. We were actually seeing a good amount of conversion, we were seeing close to 10% conversion. But also this . . . we don’t have any APIs, we just create the data, even though we have licensing agreement, Craigslist doesn’t expose this data in a reliable manner. So any changes that they make, breaks in half. So for us, it didn’t make sense and we, I didn’t want to lose focus in terms of what we were doing so we put it on the back burner. Actually Craigslist was interested, they actually had a couple of meetings with me.
Andrew: About buying it.
Sunil: Potentially buying the app.
Andrew: Why didn’t they buy it?
Sunil: I don’t know why, and this is a public interview. I don’t think that Craigslist is sort of a company where they do acquisition and bias.
Andrew: You say this is a public interview that maybe you don’t know if you should say it publically?
Andrew: Oh I see, okay.
Sunil: They all are very nice people, I mean I met with Jim, the CEO. They are amazing, and they really thanked us for doing this the right way. They really liked that, it was the best experience. But they are a small nimble company, they are still 40 people, they do it in a very traditional manner. I don’t think they do that Silicon Valley type of acquisition or things like that.
Andrew: You say, we put it on the back burner but that’s not an easy decision to make. You are investing 2 full-time developers in this out of a 12 person team. And its more resources obviously on top of it and a small company. And then when it doesn’t work out? How do you come to terms with that?
Sunil: It was a tough process. We actually lost a couple of people in a team, one of our product designers that worked on that. He was so disappointed, it just sucked the air out of him and he left for a different start-up. He is also a chief product officer.
Andrew: Because he was so disappointed that this didn’t work out.
Sunil: This didn’t work out, he had so many hopes on this. And then I kind of learned the lesson that anything that you do, don’t make it a huge launch.
Andrew: I see, because you started telling the team, this is our time. We are going to leave our mark. We’re going to create our app. If we could do it for other people, we could do it for ourselves too. It’s going to be a huge business on its own potentially. You didn’t even say potentially, you just believed it.
Andrew: I see. What was it like when you had to tell everyone, “Hey it’s just not working out.”
Sunil: I mean a lot of people actually kind of understood that it was a gradual process. For me, for the founders, it was pretty hard because we invested a ton of money in it. But at the end of the day we still had a really great team. We could work with any tech start-up, execute their product so we know we had something really good on our hands. At that point even companies like LinkedIn, Whirlpool approached us for acquisition out of acquisition interest because there was a lot of . . .
Andrew: Because they all want a good dev team and you guys have that.
Sunil: Yeah and I think we generated a lot of buzz [inaudible 00:43:08] staff so a lot of people saw it. It was on Hacker News for an entire day on the front page.
Andrew: So I have people in the audience . . . you’re a Mixergy fan, right? You signed up for Mixergy Premium back in 2012?
Sunil: Yeah I was actually going to tell you at the start of the interview. I said initially it was very hard, a lot of the time I was just watching Mixergy interviews just for inspiration.
Andrew: Thank you.
Sunil: And see how people, other people do it.
Andrew: I was talking to a few members just last week, I am looking at the calendar to see if that’s true, yeah it was just last week. One of them told me, “I have a dev shop. We’re doing okay. I’d like start building my own product,” but he said, “I have a family, I have obligations to my team who also have families. I’m worried about getting it wrong” and he said he signed up so he can watch some interviews and learn how to do it right. What advice do you have for someone like him about how to transition from building other people’s products to building your own. Either doing it right or avoiding some mistakes.
Sunil: The lessons that I have learned is, we still do products, I mean we’re actually doing a product for the smartwatch, so we still do products. But I want to make smart bets.
Andrew: How do you make smart bets. How does someone in your position make smart bets?
Sunil: I am not betting at their company. I am not the focus of the company, just pull a small team aside, get the idea. I mean, some of the projects, we just evaluate the idea, we don’t see it to market, we didn’t even build the full product.
Andrew: Give us an example of that.
Sunil: We tried to do a sales outreach product. So we actually flushed out the bio frames. We got on a good decent stage on what the product is going to be and then we actually talked to a few customers, they all liked it. But then we realized that there were two other companies that did exactly the same thing with all the functionality.
Andrew: I see.
Sunil: And then we said okay, it doesn’t make too much sense for us to do it. You never know. With a lot of these decisions, maybe if we just stuck it out and we continued doing it. I mean you just have to make a call, “Can I invest six months of development time on this product. Do I have the confidence that it’s going to make it.”
Andrew: So and the feedback that you got back was yeah it’s good but hey we also have these other products out there. So maybe yours isn’t good enough yet. Or even if it is, it’s competing against two products that are already established.
Andrew: What are the two products that are established?
Sunil: I don’t remember that.
Sunil: This has been about a year ago.
Andrew: If you were to redo the Craigslist app, today knowing what you know, how would you do it right?
Sunil: I think I just set the expectations right that this was a marketing piece for us, we wouldn’t rely on revenues for it. It was just a marketing piece.
Sunil: But I figure taking more of those small bets, I think is more important than just doing one thing.
Andrew: How could you have made the bet smaller?
Sunil: Maybe launch on just one platform initially.
Andrew: Oh and you launched on Android too?
Sunil: Yeah, I also had Android.
Andrew: Oh I had no idea, okay I didn’t realize that.
Sunil: Yeah, launch on one platform, maybe don’t [inaudible 00:46:49] ask just we did. We tried a lot of different ideas and stuff.
Andrew: Okay, the articles that I read here from the Wall Street Journal, this is from February 2013, about two years ago, said that at that point you already had Sidecar as a client and already had Threadflip. How did you get Sidecar as a client? How did you get Hipster as a client?
Sunil: Hipster is an interesting story, because I actually saw them on CNN and basically CNN was saying “Hey, Silicon Valley is starving for talent. This company is doing this,” and Hipster, they were running a recruiting campaign and their pitch was, “We’ll give you $10,000 worth of [inaudible 00:47:37] blue ribbon beer and all these weird kind of . . . Hipster bicycles.
Andrew: Then if you help them hire developers, they are going to buy all this beer for you, or buy this crazy bike for you. And the reason that they got on CNN because CNN said look at all the crazy things that Silicon Valley companies have to do to hire you. You said, “Wait, if they are that desperate, we could talk to them.”
Sunil: Yep, exactly and I actually reached out to the CEO and I said “Hey, even before you can actually hire your developers, I can build the product for you.” And at that time, I actually work with SimpleGeo on Path and he actually did some reference checks and he was like “Okay let’s do it.” So within three months, we had the product out for them. We did the initial version and exactly as we planned, they didn’t even recruit a single person by the time we actually . . .
Andrew: So they had nothing but an idea and some money, they didn’t even have developers?
Sunil: They had developers, they had back end developers. They actually had a really good designer. I’m actually a big fan of him, Steve Hoffman. So they had a designer, they had some backend developers. They didn’t have any mobile developers. So we built the iOS app.
Andrew: I see. it’s amazing that they could raise money for a mobile app. It’s just a mobile app without a front end developer.
Sunil: Yeah and I was there at their launch party and Don Dodge, I think he was an angel investor and I was talking to him, I was like, “You guys built an app?”
Andrew: They were incredibly . . . they got a lot of press. I remember going to South by Southwest and seeing that everybody wanted to try, wait, Hipster. I am thinking about the wrong app, aren’t I? What did Hipster do?
Sunil: It was a photo sharing app. But the thing was they were on TechCrunch three times even before they had a product. They just had a landing page saying “Something awesome is coming to San Francisco.” They generated a lot of press..
Andrew: Hey give me a second, I confused him with Highlight which was another app that got a lot of attention. And Steve who did the development for them is the same guy from Hipmunk.
Sunil: No it’s not the . . .
Andrew: It’s a different one, okay.
Sunil: I was talking about designers, he was also one of the co founders. It wasn’t a blank slate, somebody gave them the money, they had the backend developer done, they had designs.
Andrew: I see, all right, and you also said that you are on the list with a venture capital firm, a CTO list. What’s that?
Sunil: That’s the same stuff that we talked about initially, Joe Stump put us on a CTO list [inaudible 00:50:21].
Andrew: What does that mean a CTO list? That means a list that CTOs would look to if they needed developers?
Sunil: I think it’s an email list. They would email each other saying, “I’m looking for something.” I don’t know the internal, how they actually manage it.
Andrew: You mean a mailing list.
Andrew: Got it. And so because you are on the mailing list they get to know you, you’re chatting with each other and that helps you get some credibility and recognition in the community?
Sunil: Yeah. It’s the internal email. We are also actually on, so we had Google actually reach out to us like three times now for three different projects and I ask them, “Hey how did you hear about us?” They said, “One of the developer advocates put you on the top 10 Android development forms.” So we don’t know what that list is but we are on a top 10 list within Google.
Andrew: I see. You have finally figured out how to charge right. How did you figure that out?
Sunil: I think when we got the first real sales person, he was like, okay you guys do all this amazing work and are we charging $85 to $100 an hour? That doesn’t make too much sense.
Andrew: Who said this to you? Your client said that?
Sunil: No, our first sales person.
Andrew: Got it, okay and that’s when you started to raise your rates a little bit.
Andrew: How much did you raise your rates by?
Sunil: I would say we actually raised our rates almost by 100%.
Andrew: And no push back?
Sunil: We’ve had push backs from start-ups, but right now we actually have bigger clients like AT&T, SanDisk, starting some engagements with DirectTV, Plantronics. And also start-ups like Glassdoor, LegalZoom, these are companies that can actually pay the market rate for good development and design to sources. I mean we do incredible design too. I mean one of our designers is actually based out of Chicago, she was actually a creative director for BarackObama.com.
Andrew: For what?
Sunil: For barackobama.com.
Andrew: Oh barackobama.com. I see. So how do you recruit people like that? Frankly, I’m looking at your early design work, it is not nearly as good as it is today.
Sunil: Yeah. If you actually go to the Morkiya.com/new, we’re actually doing a new website. But I mean, the first step was we actually acquired a small design firm that we used to work with initially. So we built princples part of the team. I think one of the things that people like with us is we give them incredible freedom. There is no micro management, whether its design or development, the reason that a lot of these developers that they can actually go out today and get a job on Google or Facebook. I mean one of the constraints is location for sure. But they can get equally good jobs, things that they like is the freedom that we give them.
Andrew: You give them freedom, if it’s your client who is looking for a specific kind of product and so aren’t they imposing some rigidity on the process?
Sunil: I mean there is some process that is dictated by the client, but freedom in the sense, they get to work on great projects. There is nobody micro managing time, we don’t ask them to actually log hours or anything, we don’t tie them to . . .
Andrew: You say, here is the project, get it done when you can.
Sunil: Yeah, we use really good tools. We use GitHub, so every line of code is transparently visible. We use Slack, every project gets its own room. So whenever somebody comes in GitHub and it shows up on Slack. So these are autonomous teams, every project has two or three people teams. They work very independently. Very minimal management for the sake of management.
Andrew: What kind of direction do you give them?
Sunil: We have product managers that actually set the milestones and everything. But from the overall direction, my goal is for Mokriya be a place where people can actually do their best work. So the thing that I keep trying to push is do your best work, look at this as a craft, try to improve. Basically looking at this as a craft and actually making small incremental progress, doing better. For instance, with iOS we now have Swift. a lot of our developers actually are doing new products and Swift [inaudible 00:55:29].
Andrew: I see. Your revenue, where is it now?
Sunil: Did that Wall Street Journal article have a revenue number in there?
Andrew: Oh I don’t remember what I saw, what the revenue was. It was 2013, do you remember what the revenue was at that time? Oh yeah it does, it says, “Founded in 2009, Mokriya did $1 million dollars in 2012. In large part because Silicon Valley startups can’t find and hire talent quickly enough.”
Sunil: Yeah and so its multiple of that at this point.
Andrew: So 2014 was multiple million dollars, more than 10 million?
Andrew: Somewhere between 5 and 10.
Sunil: Less than that.
Andrew: Okay, so look at this, the same article says Sidecar raised $10 million series A round. Do you remember those companies and say, they are raising tons of money. I am here, still a bootstrapper. Still trying to hire, still trying to pay attention to the bills on a slow basis and they’re just zipping pass me. We’ve got to get out of this. Maybe we buy one of these start-ups or we start, I guess that is what you’re thinking. We should create our own product and then take off like these guys are.
Sunil: Yeah, I mean if you compare with every other start-up that gets funding.
Andrew: It is much painful.
Sunil: Yeah. It is not a viable way to actually look at things. So for me what’s important is we want to build a company, a long term company. We will take shots at products on the side. But we have a healthy revenue generating business and a lot of the stake startups that we helped back in the day are not even there anymore. So in that sense . . .
Andrew: Much more stability than they do. So yes, some of them end up raising tens of millions of dollars or millions of dollars and they take off but many of them end up disappearing. You want more of predictable business with the options for an up side and that’s why you’re building products on the side.
Andrew: All right, what’s the best part of having built this whole business?
Sunil: For me it is the team that part of it. I guess we’re a little lucky we have an incredible team that we have been able to assemble. I am incredibly proud of that, the team that we built. I mean we’re still in the early stages. I think there is a lot of potential. I look at this and from a very long term standpoints, there is still a lot of potential.
Andrew: Yeah I can see it, I mean the level of companies that you are working for just keeps getting bigger and bigger. You guys are working with Sea World, you are working with AT&T as you said.
Sunil: SanDisk, DirectTV.
Andrew: There you go.
Sunil: Plantronics, we have had a lot of conversations with Google, Samsung, Intel.
Andrew: Cool, congratulations on all your success. The website is Mokriya, M-O-K-R-I-Y-A.com and I want to do some closing credits here. I want the audience to see a little bit more of how Mixergy interviews are done. So I have been hinting at the fact that we do pre interviews, pre-interviews are done by Jeremy Weisz who produced this interview. Research for this interview was done by Andrea Schumann. You were referred to us by Rajesh Setty who referred so many great people to me. That guy is an incredible connector, and an incredible entrepreneur too; I interviewed him. And this post will be put up on the site and written up by Arie Desermo, formally you guys have seen him on the site as Arie Saint. That is just part of the team here at Mixergy that brings these interviews together and I’m really grateful for them for doing it and grateful to you Sunil for coming here and telling your story.
Sunil: Thank you Andrew and thank you for all the listeners. I think this is an incredible resource for entrepreneurs, ones that are starting up. I’d recommend listing to ton of these interviews.
Andrew: The cool part about doing it is that I used to say I want to do these interviews for people who go out and build companies that are so great that I will then get to interview them. And you have probably heard me say that, you’re smiling, you recognize it. And at the time I wasn’t sure when I first said it, if that would ever come true and now I see it more and more coming true. You are an example of that. I want to do hard hitting detailed interviews and just keep pushing myself to get better and better at them so that there is more useful information, so that they’re uplifting and inspiring but also full of concrete ideas and techniques for building businesses.
So the people who are listening to us today, the person who is listening to this interview will one day come here and do an interview on Mixergy. Sunil thank you so much for being a Mixergy fan. Thank you so much now for coming and telling your story and everyone out there, thank you for being a part of Mixergy. Bye everyone.