What is that propels a person to finally take the entrepreneurial jump? The desire to create something of our own. That is the story of Bert Labs founder Rohit Kochar, who along with his wife Bhavana Mittal, is the driving force behind Bert Labs, a clean tech enterprise that helps companies cut down their power bills.
What made Kochar diverge from a successful corporate career to turn entrepreneur? And why did he choose India as his first base? Enterpreneur-couple Kochar and Mittal reveal in a free-flowing conversation with TICE. (Edited Excerpts.)
Q: You set up Bert Labs in 2017. How did you come to decide that you would be setting it up? When did you decided to take the entrepreneurial plunge?
Rohit Kochar: I have been blessed in terms of the success that I got as a professional. Just few data points, I was one of the youngest vice presidents with American Express bank. I was VP with AmEx, in the third year of my career, leading their personal financial services division in India.
More or less the same, you can say about my stint with GE, one of the youngest vice presidents in GE. And this is with GE Capital International Services, the company today called Genpact. And then I was managing director at the age of 28-29. And then, MD Hays PLC group. RR Donnelley acquired the technology business of Hays and RRD is a 10 billion US dollar NASDAQ listed company. So I became part of our RRD where we acquired another company called Office Tiger. So Office Tiger used to be a leading KPO firm, knowledge process outsourcing company and RRD acquired it, I was instrumental in integrating office Tiger with Hays business and then ran this combined business as part of
RRD for about two - three quarters. It had a consolidated revenue base of 630 million US dollar.
Then chief executive for Macmillan Publishing solutions limited. During those years, the likes of McGraw Hill, Pearson, these were giants.
I moved on, I became President and Board member of another technology company in the US, I was in the US for four years. So build this company from 40 to 600 million US dollar revenue. And company got valued at 1.8 billion US dollar. When my private equity investment partner Apollo Global Management, they sold their stake to Morgan Stanley
private equity. So that was the second successful exit.
So that's when I gave everything up. I'm purposefully using this language, gave everything up, because literally, it was that way to be an entrepreneur. So this was end of 2011, early 2012. Because I wanted to build my own company. But I didn't start Bert Labs at that time.
What happened was that I gave successful exit to Apollo. So there were a lot of private equity investment firms in US who wanted to work with me with the objective of evaluating technology businesses, globally, and do a buy and build. So, I was doing that for about four years between 2012 and 2016.
So, then in 2015 towards the end, seeds were sown in the form of Dice Automations. Finally, we changed the name and incorporated it in early 2017. So, that's how, you know, Bert Labs came into existence.
I zeroed on healthcare and energy and then finally selected energy as my focus.
About Saving Energy and why Bert Labs chose India:
So energy has you know, three sides to it, generation distribution and consumption. So, the easy part is obviously to look at the consumption because you are a start-up company, so obviously, you look at that part, which is a low
hanging fruit, relatively speaking. Now, on the consumption side, how do we make this world more energy efficient, because energy saved at one place is energy leveraged at another place. So, how we can help this world save on energy.
Now, energy consumption is largely around manufacturing and non-manufacturing. Now, manufacturing is a complex process to look at. So, the thought was that we will indeed look at it, but at a later date, let us focus on commercial buildings to start with. And to start with you know, India as a market, because I wanted to set up here in India, even though the option existed to set up in US, because, some bit of you know, if I could add here, which is a reality
also, patriotic feeling in terms of that this company needs to be headquartered out of India and needs to be built out of India even though it would be global in every sense of the word, but it will it will be from India, it would always be known as an Indian company, Microsoft -will always be known as a American company, even though it has a global footprint, Google will always be known as an American company, even though it has a global footprint.
So, similarly, you know, an Indian company, which is solving complex problems through innovation. So, we started here in Bangalore with focus in India. And after AmEx, you know, this was the second time around for me as a professional, the focus was India as a market. Otherwise, all throughout from GE to HOV services, it has been developed markets.
Q: What was the first product which you thought that you bring to the to your consumers?
A: It is always, you know, the problem first. So, it didn't start with Internet of Things (IoT). It didn't start with Artificial Intelligence (AI), it started with the problem. So and the area so it was energy, it was energy efficiency. So that came in first. So what we started to do is as I was sharing with you to begin with focus on commercial buildings in commercial buildings, your centralized air conditioning system is the major energy guzzler anywhere in the world you go. So, we started to visit lots of commercial buildings, from airports to hotels to hospitals, to office complexes, etc.
Q: So, did you think that this idea was viable when you began?
A: See, this is a difference between some somebody who is fresh out of college and somebody who has gained experience in terms of intuitively feeling that an idea or a problem statement or a product is commercially viable or not number one, number two, energy as an area is universal problem or universal focus. And it will always remain of focus till you and I are alive and after us. So, commercially viable was a factor.
This directly impacts the strategic goals of large corporations. So, what are the strategic goals, one is ESG sustainability, second, capital efficiency, because this directly impacts you know, their bottom line. So, till you and I are running our businesses, this will always always be the fundamental requirements of running a company.
So, from that, so, both from a sustainability ESG goal standpoint as well as from the capital
efficiency improving profitability standpoint, it was a very, very sustainable model.
So, you know, all our clients India and outside India, they have very clearly defined sustainability related goals. So, we commit numbers. So, whatever is the baseline on kWh on fuel, we bring down minimum by 30% three zero. So, if you know the energy bill of a large factory is 10 crore, we help them save you know, three crore and bring down you know, from 10 to seven crore and this is annual.
Q: This is a niche area. How did you attract business?
A: So, the business you know occurs primarily in two ways. One is we choose our clientele very carefully, we focus on large corporations with whom we can scale up. So, we start with one site, the site could be a manufacturing plant, it could be a building and then once we are a success in terms of reducing against the baseline by 30%. And this is you know, over a smaller time period, because this becomes a proof of concept. So, once we are a success at
the proof of concept, the client scales up and the scale up is very rapid, because our Bert Platform Solution which is all Bert proprietary and patented, you know it is giving enough leeway for the client to rapidly scale up, when I say rapidly scale up, in one year scale up to 100 factories globally. as rapid as that.
Q: So, when did AI and IoT step in?
A: So, the problem came in first, and to address this problem most effectively came in, you
know, AI and IoT. So, that's how it was born. So, IoT helps us, you know, to lay out the data infrastructure to capture into real-time transmitted. So we have proprietary IoT devices, which helps us to capture a variety of data points in a manufacturing plant and in a commercial building. And this data is real time transmitted through our IoT powered wireless sensor network. Once you know it is captured and transmitted, then we have this data processed, and real-time computed. So, this is done through Bert Nova, Bert Optimus and Bert Geminus. So Bert Nova is our big data lake
software platform. It's our distributed computing platform. And Bert Optimus and Bert Geminus is our digital twin and AI platform.
Q: How much do you invest in your developing your own technologies?
A: I will not be at a leeway to give you the number. But yes, among the major cost heads,
which we have or investment heads, research and innovation is your number one and then it comes
to people. And third is, you know, our working capital requirements or as part of working
capital requirements, largely it is around sales and business development because we are
pursuing a 500% year-on-year growth.
Q: You decide to set up Bert Labs in India. How did the decision turn out for you?
A: Up till now we have global clients, but we haven't yet executed outside India, we would have done it if not for the pandemic. Because with some of our clients, we were planning scale up in 2020,21,22. Now, we are scaling up outside India. So you will see more of Bert Labs in Middle-East, in Us, in UK, in Germany. But we are global from the perspective
Q: The decision to set it up in India, do you ever feel that you know you would have done things differently? Or are you still kind of convinced that that was the best decision that you took?
A: No, I wouldn't say best decision. Best decision would have been to set this up from west coast. But I would because you know when you are an entrepreneur, emotions also drive you and it should drive you because that's the charm of being an entrepreneur. Through mind some decisions are made, some through heart also. But it's not a bad decision also at the same time because India has the market India has the talent.
The challenge here in India is you know the propensity for a deep tech company and more importantly for an innovation product platform like us the propensity for a large corporation across sectors to buy it is relatively less compared to a US or compared to a Western Europe,or for that matter, even Middle East.
So from that perspective, we would have, you know, scaled up much more if this would have been headquartered in the west coast. From a talent perspective, obviously, India has a talent. So from that perspective, it has been a good
Q: Well, now Bhavana you being better half of Rohit and both of you run the company together.
So how do you define each other's roles? Are they clashes sometimes?
A: No. So I think, you know, as an any, any relationship, there are going to be clashes, but at the same time, it is when you know that the larger purpose is there, and it's well defined. So there can be differences of opinions, because both of us come from very, very different backgrounds. Then the primary objective is to see what's best for the organization. And it's not about keeping score of who's kind of taking the responsibilities.
So for us, it's like, typically, you know, Rohit being the Chief Executive Officer obviously has the whole thing on the technology also been his brainchild is something which he's completely do, however, where you get into product management, where you get to try outreaches, the sales and the business development part that comes to me in of course, then there are other things like, maybe HR will be more aligned with me.