Summary

The Offline Network Episode 21: Longevity, Robots & Upskilling Race (aired 2025-10-17). Guests: Raghav Gupta, Gaurang Kuchhal, Anand Yadav from 1% Club / Futurense, MEKR, MEKR. Raghav: "So in Futurehands, I think we realized that with all this whole AI jargon, this whole AI narrative, the Indian IT services population was at a very big risk." Raghav: "Now, what happened was COVID happened, I was studying in college, I had to come back to India." Topics: venture capital and funding, AI and LLMs, consumer brands and D2C, health tech. The Offline Network is India's live show on startups, tech, and venture — streaming M/W/F at 4 PM IST on YouTube.

Full Transcript

Dhruv Sharma: Hello, listeners, and thanks for tuning in to the Wednesday's stream of the Offline Network. If this is your first time tuning in, we'll maybe spend a couple of minutes talking about why we're doing this show. So my name is Dhruv Sharma. I'm having a lot of fun working on the Offline Network with Utsav, but my day job is to lead a team that runs AngelList in India. Over time, we've become one of the largest, if not the largest startup investing platforms in the country. Utsav was our first leader, and then he founded this company called Offline, which is a network of, you know, really the top 5 or 10% of India's founders and CEOs. And we would keep going back and forth on interesting ideas for content experiments. And then a couple of months ago, we came across something which really blew our minds and inspired us to try out this format, which we're doing right now. So we do this thrice a week. We typically start by breaking down interesting bits of news, very often news from India, sometimes news, global news, global tech news that we think might be of interest, that is of interest to us, we think might be of interest to our listeners. And then we get interesting guests. So today, for instance, we're going to have Raghav, Raghav Gupta, who runs not one but two companies, one company called Future Rents, and then another company called the 1% Club, which is something he co-founded with Sharan Hegde. And we're also going to have co-founders today, Gorang and Anand, who are building a company called Mecca. And Utsav, how are you doing?

Utsav Somani: Awesome. I think one thing that you missed out is the undertone that we want to have while we're doing the show. I've been thinking about this since we've done 20 episodes now. So techno-optimism, techno-optimism is a word that I came across very recently. And that sort of defines how we feel about talking about technology. I think there is so much negativity around us in terms of just the content, just for click-baity stuff, that we really want to bring out what's the best being done in the ecosystem and what the efforts of these founders have led to. So this show is our hope that we're able to showcase you what's happening in the minds and the companies of some of the best founders' journeys as well. So yeah, I'm excited.

Dhruv Sharma: We thought it'd be interesting to have like a builder-to-builder conversation and see where we go from there. And in general, it's harder to be an optimist than a cynic. So we are applying that lens and let's see where that leads us. Awesome. What's the first line item on the news? It's to do with AI. And the funny thing is, I read this somewhere, but it sounds like there's so much AI news, we might as well have a Richter scale for AI news. And this one comes from OpenAI. They announced, I think it's been 10, 12 hours now. So maybe their evening yesterday that they have finally simplified the corporate structure of this company. Everyone knows that OpenAI started out as a nonprofit and there is still a foundation, but it holds equity in the for-profit part of the business, which is now a PBC, a public benefit corporation. But really what this announcement is about is, you remember that when Microsoft and OpenAI joined hands, it almost appeared like they're going to be each other's ride and die all the way through to AGI. And part of what they've been able to do here is sort of unconstrained themselves from that complex web of constraints that some were legacy, some that imposed on each other. And so Microsoft on their part have parlayed away a slight haircut on their stake in OpenAI, which is roughly worth $135 billion. That is a 10x return on the 13.8 billion that they've invested since 2019. So there's a solid return, but they have gotten diluted and they're happy to accept that dilution in exchange for a $250 billion cloud contract with OpenAI. And they used to have a row for what's called a right of first refusal on where the computer is going to come from. They waived that off as well. And OpenAI gets to again, walk away with a fair amount of flexibility in terms of how they pursue growth from here. They can release open weight models from here. They can have other cloud partners. They can start selling to the government. And many people say this is really OpenAI clearing the path for its own IPO. A lot of people say, Hey, all of this suggests that AGI is still a long, long way away.

Utsav Somani: And free chat GPT Go for Indians for one year after perplexity for a year. Yes. We had to have fun with this. Yes. Awesome. So next up is Brian Johnson. He's my favorite entrepreneur because I think what he's done is made himself a test case for these extreme experiments in health and longevity after he sold his company Venmo and sort of built this cult-like following around himself where people follow him pretty much blindly. And so do I, to be honest, anything that he puts out, I trust him blindly. And this is, I think the perfect example of what a creator-led brand should look like in the very best case scenario. And he's raised 60 million from some of the best names in the startup and the tech and the entertainment space, including Kim Kardashian, Winklevoss Twins, Naval Ravikant is there as well. Even Paris Hilton is there. And he announced that Blueprint was on a hundred million run rate. We're losing money and, but he's going to deck up on hiring with this one, but his focus now shifts from just selling supplements. People have called him a grifter as well, but I think otherwise, but everything in this world is up for debate. But he's going to focus on other things as well. Like he's going to become a full stack health OS where they're going to do these, I mean, prescription stuff, GLP one drugs, food delivery, blood draws, skin and hair care, supplementation. So it's going to be pretty exciting because I think 80-20 rule applies in this as well. For most people, if they do even a large part of what he recommends and can be done at ease at your home, I think the benefits of that will be tremendous. I think he's one of the first person who's saying that humans shouldn't die. So I think it'll be very, very exciting. Yeah.

Dhruv Sharma: I think you invited him to come chat with the offline community back when, back when we didn't have the offline network.

Utsav Somani: He was actually our first guest speaker as well. And he had an interaction with 18 of our members. It was late at night on a Friday and people showed up and asked him all sorts of questions. He was having his last meal of the day at 11 AM. So he eats famously from 7 AM, I think it was 7.30 AM to 11 AM. After that, he doesn't eat anything in the day. He has his dinner at 11 AM while chatting with us at 10.30 AM.

Dhruv Sharma: And he said it's the saddest moment of his day because he makes this dessert with blueberries and a few other good things that was about to get over. But this longevity industry is really on a tear.

Utsav Somani: Yeah, longevity industry is on a tear, but our colleagues are at a network school right now and they also famously serve, Balaji's network school, they famously serve the blueprint meals there as well. Hit or miss according to Yashvi and Tanisha. Somebody likes it, somebody doesn't. I'm not going to mention who. But I mean, longevity industry, I don't think there's a number that you can put to it. I think it's 100 billion, 140 billion, all of these numbers are just massive. But I think it's just a massive industry. Imagine touching every human being on planet Earth who wants to live longer. And Dipinder Goyal also put some money behind this thing as well with continued research that we discussed on Monday.

Dhruv Sharma: And for listeners who are really interested in this subject, we had someone called Dr. Marcus Ramney, was it? Yeah.

Dhruv Sharma: Yeah. So you can go to Doc M, you can go to one of our previous episodes and tune in. You know, one lesson, by the way, when you when you hear someone like Brian speak, of course, he's super long term focused, but also for a man of his accomplishments, really open to changing his mind. He had at some point in time publicly, publicly said, Look, I don't, I'm not going to build this into a large company. This is really just research I'm doing on myself. And, and, you know, he's, he's changed his mind about that, which is, is interesting.

Utsav Somani: Yeah, I mean, he's taken stuff like wrap myself in and gone off it. And the best part is, he shares all of this publicly. So for people to follow and also with the disclaimer that all of this is very personal health stuff. So I think it's exciting. But talking about other things, like I think one of my favorite technology things came out yesterday, I've been following this company 1x. But just to see the launch video yesterday, now it's available for pre orders in the US as well. I was checking on the website, they ship to India as well. It's a company called 1x, which is a Norwegian company, which I think was founded in 2013 or 2014. They've since shifted their base to SF, they've raised from Tiger Global and many other sovereign funds also, and many other prominent venture capital funds. But their new product, NIO or the first product, which is available for consumers is called NIO. And, and it's fascinating, you really have to see the launch video, it can do so many different things, it can complete household chores for you for $20,000. You can own the thing outright, or you can pay $500 subscription. Imagine a robot, a humanoid robot taking care of everything that you want to do at home, and it's shipping in 2026. And I mean, it can do lift items up to seven kgs, can wash your dishes, clean up your bedroom, all of that stuff. And it's, I mean, the tech is very, very fascinating, you should read up on their website. They have, I mean, detailed some of this tech and how it runs on device. And there is also an element that can be scary to some people where a person from their operating team can actually control the humanoid if it gets stuck somewhere. So privacy issues always will be there. But excited to see where this goes. Because Tesla and Elon Musk are also of course, stepping into the space with Optimus. So I think it's going to be interesting. And I don't know, man, I hope people would have learned after iRobot, Will Smith, the movie, right, where it really went dark with those robots.

Dhruv Sharma: Or Asimov's novels. But, you know, we've for the longest time, we've had robots like that, that are the physical equivalent of a point solution, robots that solve a very specific, do a very specific thing. But general purpose robots and robotics has been a way. By the way, in the field of AI, there is this data barrier that general purpose robots also have to cross, they can't be trained in generic data. There are companies working on that as well. It's very interesting news.

Utsav Somani: All right, that covers the news segment. Let's welcome our first guest, Raghav Gupta. He's the co-founder of Futurehands and 1% Club. Raghav, welcome to the show.

Raghav Gupta (Futurense & 1 % Club): Hey, how are you guys doing?

Utsav Somani: Thank you so much for coming on the show. I think, why don't we start off with a quick one, two minute intro to the two companies that you run? Sure.

Raghav Gupta (Futurense & 1 % Club): So in Futurehands, I think we realized that with all this whole AI jargon, this whole AI narrative, the Indian IT services population was at a very big risk. Because on one side, this is driving employability. On the other side is driving the consumption that you are seeing in these urban centers, predominantly because the FDI flowing in from IT services standpoint. So the thought was that can we create a whole supply chain to engineer this audience from a back office kind of work to more front office AI engineering, FD forward deployment kind of job profiles. And that's what we do at Futurehands where we have multiple models. Our main revenue driver is where we work with a dozen IITs and IIMs, where we run their entire online degree and online certification business end to end. And then we also work with GCCs, captive centers, some of the biggest banks, where we provide them very different staffing solutions, like hire, train, deploy, or contract to hire model, which are very much focused towards niche tool oriented AI engineering roles. So that is what we do at Futurehands. In the last four years, we've trained about 25,000 students. We right now have about 350 employees are scaling very fast, we've grown like 70-80% year on year, last four years bootstrap. So this is the first business. The other business is called 1% club, where the thesis is very simple that in your schools and colleges, you are not taught about money, you are taught how do you make money, but you're not taught how do you manage your money. And that was a very big opportunity that we saw that let us try to educate people on this. Now while educating them, we realize that people fundamentally are very lazy. They are like you told us what to do, can you execute it for us? And that's where we started working with SEBI, got multiple licenses like RIA, RA, so on and so forth, where we are now managing the money of our audience. So from an education standpoint, again, we have about 10 million followers across our social media handle, about 400,000 people who have paid us money, and about close to 100,000 folks who are a lifetime member of the 1% club. Now out of these 100,000 folks, about 15,000 of them are being engaged through us in our financial services. And in financial services, we have two angles. One is robo advisory kind of model, which is more on the distribution income side. And the other is the RIA, which is more manual, but with a very strong tech operating layer to increase the efficiency of the financial planner. So yeah, that is what we do.

Dhruv Sharma: Wow. Shall we talk about future ends first? Let's let's maybe talk about future ends first. So Raghav, why did you decide to start this company now? People always ask the timing question, help us understand and our listeners understand why was now the right time to start this company?

Raghav Gupta (Futurense & 1 % Club): So I was studying in Atlanta, Emory University. And this was 2019. And that was the time when we started hearing a bit about transformers. We open AI was there in the academic circles, people were discussing about it. And obviously, Google had innovated on the transformer science by then. So it was in some academic circles becoming a nomenclature that there is a shift that is coming now, it might take five, seven years. So did I start at that time? No. But that was the time when I started sort of factoring it in that some new technology shift is about to happen. Now, what happened was COVID happened, I was studying in college, I had to come back to India. And that's where I saw an opportunity with respect to GCC hiring, where all of these big fortune 500 companies were opening their captive centers in India. And I was surprised to know that 70 to 80% of the requirements were not being fulfilled. And the answer was very simple. They require very tool oriented folks that will not be taught in a regular college because colleges are training you for a bulk kind of job. So that was an opportunity where we saw can we create a model where we give free training to talent, and at the same time, give them a guaranteed job while I'm in free training.

Utsav Somani: So anyone who's passing through future and ecosystem is getting free training.

Raghav Gupta (Futurense & 1 % Club): That's how we started. So our initial model was we work with let's say a fortune 100 bank, that bank needs 100 folks on a particular tool stack that is not available in the market. They are willing to pay 25 lakh rupees per person annualized salary for one role. What we do is we go to TCS, Infosys, Wipro, all of these body shopping kind of places, create a prerequisite that let us say that the company needs 10 skills. Now out of those 10 these three skills are prerequisites that I need someone to already know, be very good fundamentally at. If they know these three skills, four skills, I can train them on the remaining three, four, five must have skills. So what we do is we hire people not on the basis of what they know, but what they can know. After hiring them, we train them for three months on the curriculum that the captive center that the GCC wants. Once the training is done, during the training, I'm paying them a salary. So I'm paying them whatever last salary they were earning. After training, I deploy them as a contractor. Now the beauty of this is that the company was willing to pay me 24 lakhs for a role. The guy was earning 6 lakhs in Infosys. So I will tell that guy that I will double your salary, zero risk. And you have to be on my payroll for 12 months. And to the company, they get the full talent. And it's a build, operate, transfer model, where depending on the contract, it can be six months, nine months, 12 months, they come on the company payroll. So I make my margin during that time for my risk and for whatever I did.

Utsav Somani: Percentage gets lost. Do you think a hundred percent of employees get transferred to a company?

Raghav Gupta (Futurense & 1 % Club): No, not at all. Right. So broad level, we operate about 70 to 75%. And that's where we realized, right, with this business, this was doing very well, extremely high margins. Challenge was operational leverage. My balance sheet was becoming like very heavy. And with the global layoffs in 2022, I realized that the first people to be removed are the contractors. And my whole business model can go up and down. And that's where we were following up with IITs. We realized that the whole IIT education, the whole IIT brand, it needs to be democratized. Every year, 15 lakh students are studying for GE. Out of those 15 lakh, only 16,000 are getting inside IIT. And only 2,400 are getting a computer science seat. Now, if India wants to fight with China, if India wants to fight with the U.S. on the talent war, then the sheer quantum of people who get access to IIT level teaching, IIT level research, that needs to increase. So we saw this as a very big business opportunity as well as an opportunity for the ecosystem. And we were the first players in the market to start offering regular IIT degrees online. So my degrees don't say the word online. They are regular degrees. So there's a heavy level of compliance, heavy level of bureaucracy, heavy level of structuring that we do, that we follow, where we run this business end-to-end with IITs, from the curriculum to the customer acquisition, to the platform, to co-delivery, to placement, to so on and so forth. And to the particular IIT, they have the checks and balances, compliance in place. And what has happened, Utsav and Dhruv, is that I started this vertical in 2022. Right now it is contributing about 65% of my revenue. And the future growth that I'm seeing is the most in this vertical, because my ability to churn talent as well as churn revenue is extremely fast.

Utsav Somani: But I mean, interesting that you mentioned these partnerships with IIT, because I'm guessing that must have been a very, very tough process, convincing them to make you the exclusive partner to do this stuff online. Tell us how that process was, and also what is in it for them? I mean, in the sense that don't they want to protect the brand per se? Like, I mean, I mean, you can eventually like onboard like 100,000 students, 200,000 students one fine day, of course, with their checks and balances, they might restrict some of that. But does this partnership entail like, I mean, steady growth or unlimited growth?

Raghav Gupta (Futurense & 1 % Club): Sure. So answering your first question about how did these partnerships happen? So in our first business model I talked about, right, we were very close to the employers. So my narrative, my storytelling, my detailing was very much job oriented, which most of the players in the market were marketing companies. I would not name them. But I think people who are watching this would realize the kind of companies I'm talking about, who are more focused on kind of IPL, Shark Tank kind of marketing, where the focus was not really on core employability, core academics. Second thing is, one of the biggest reasons was the trust. When we went to them, we went with a huge checklist, a huge compliance list that we will follow so that they can hold me accountable whenever they want. Now, with respect to how does this partnership work and why does an IIT want to work with me? There are multiple angles to it, right? First is new age curriculums. IITs, for whatever reason, they have their own academic pursuits. They need the industry kind of support. They need the industry kind of benchmarking that I'm able to provide. Secondly, for them, what we have realized is that they don't want to get into customer acquisition. That is not their focus. That's a very opsevy, capital intensive, risky proposition. They want to check what I'm doing. So there are the huge guardrails that we have set, but they don't want to take that headache. Third, obviously, from my angle, I de-risk them. I give them a certain mathematical model, which de-risks them, de-risks their professors, de-risks the Senate. They will always make money, even if I don't make money. And IIT will always make money. So that was the whole thought in that. And fourth is that it is the degrees. There is a huge bureaucratic structure that goes into it. So for every degree, I have a certain number of seats. So for an MTech, the max seats per MTech per batch is, let's say, 180. I can never take that to 5,000. In certifications, you can increase more. That's why we are getting into certification. But certification is still a bigger kind of market. But the degree market is where we are protecting the brand, if that makes sense. So from an IIT standpoint, de-risking it, credible partners, futuristic curriculum, end-to-end solution, my platform, all the risk is mine, all the upside is shared.

Dhruv Sharma: Solid. Raghav, if this works with one IIT, why doesn't it work with all IITs? So right now, I am working with the… You have to go convince them one at a time?

Raghav Gupta (Futurense & 1 % Club): Yeah, yeah, yeah. That's the whole point, right? That's the whole point. And these IITs, the way they run, it is very different in every IIT. So the older IITs, like let's say a Madras or a Roorkee, that's where you will see that because of the tenurity of the professors, the senates have a comparatively higher say. The decision making is longer. The newer ones have a different kind of structuring. So it's very dependent on the IIT we talk.

Utsav Somani: Yeah. And I mean, Amazon, I mean, recently it was in the news today and yesterday, Amazon laid off 30,000 people and many other companies have jumped on this bandwagon, even Meta, like from that AI division have laid off people as well. What is the world coming to? What should, I mean, a person working in a mid or a junior level IT job be worried about and how can the future proof themselves apart from coming to you?

Raghav Gupta (Futurense & 1 % Club): So firstly, answering the Meta thing, right? They have four AI teams. They laid, so they are basically concising all of them together. So that's why they laid off. So it's not really the people are trying to create a different narrative out of it. From the AI team, gross level, the hiring is increasing. Secondly, when it comes to whatever is happening in the market, a lot of hiring that you saw in the past was driven by a diversity push, was driven by a huge bureaucratic push and cheap capital that was available in the market. Now, all of that is changing. So it is not a AI shift that you are seeing that people are being laid off because of AI. It is still predominantly a more macroeconomic reason why companies are laying off people. That's, that's point number one. And if you look at any study, like the basic MIT study or any of those studies you look at, you will know that the AI implementation is not as high as we would like to believe. At a broad level, it's not even affecting, from a P&L standpoint, a two or 3% bottom line difference. So it is still a lot in the narrative right now per se in actual implementation. That is point number one.

Utsav Somani: So there is fear of the future, right? Like, I mean, that is the beauty for a business like mine. Are companies using AI to get out and trim their, I mean, cost centers?

Raghav Gupta (Futurense & 1 % Club): So there are two kinds of jobs, right? One is a job where you need a person to do it. And then other is a knowledge work. I operate in knowledge work. And bulk of the IT services population is in BPO, which is not knowledge work. So that is where platforms like mine are an opportunity for them to transition into knowledge work, where what you will realize is still the demand and supply gap is massive. You go to any tech company, you talk to any tech founder, he will tell you, I cannot hire people. You ask anyone, ask anyone on your offline group, you will get the answer. So what that tells you is there is still a very big demand and supply gap. So the game is, the devil is in the detail. You have to be very detail oriented. Your articulation abilities from a talent standpoint become more important. And in some shape and form, a system level thinking, where you are thinking workflow first, where you are thinking tool orchestration is where talent is going. And another example, right? Or UPSC, how many seats does the IS have in India, but how many people study for it? So that should tell you that it's basically like a lottery ticket. The number of people who will benefit from it might reduce, but the number of people who are benefiting will benefit a lot. The kind of salaries they will earn will be a lot. And looking at them, the next million people will want to be them.

Dhruv Sharma: And how about the 1% club? Let's switch the conversation to in the remaining time we have, Raghav, to the 1% club. What's it like working with Sharan?

Raghav Gupta (Futurense & 1 % Club): Very good. Very good. I think he's genuinely, genuinely very, very passionate about the subject because whatever he talks about, he has implemented that in his real life. And because he's implemented that in his real life, it is very authentic. So it's great working with him because he's very true to the purpose.

Utsav Somani: And what are the numbers like for 1% club? Anything that's public or you want to share for the first time on this platform?

Raghav Gupta (Futurense & 1 % Club): Sure. So in 1% club, broad level, last year we did about $8 million in revenue. Highly profitable. We have never used the funding that we've raised. It's in an FD. And whatever money we've raised in the FD, we have multiplied that by a multi-fold.

Utsav Somani: And you've raised from Nikhil Kamath as well?

Raghav Gupta (Futurense & 1 % Club): Yes. Yes. Yes. Yes. So from a business standpoint, highly profitable, highly scalable. From a customer acquisition standpoint, we are the only fintech that is a profitable CAC. So people pay me money to become my fintech customer. So because I monetize them through education.

Utsav Somani: And there's a huge community aspect to this whole business also.

Raghav Gupta (Futurense & 1 % Club): Yeah. Yeah. Full, full community, full community. So basically very quickly explaining what the business is very, very quickly. We run multiple masterclasses on different topics. You might have seen some of the ads. People come for that masterclass, pay 200 rupees, 400 rupees, 500 rupees. It's a two-hour masterclass, three-hour masterclass. Every month, 20,000 to 40,000 people come for a masterclass. At the end of the masterclass, there are multiple kind of upsells that we do, multiple kind of propositions that we give. One is a membership, one is an RIA, one is so on and so forth, where they become a financial services customer as well as an education customer for us. Predominantly, still about 80% of our revenue comes from education. We see that becoming 25 to 30% in the next three years.

Utsav Somani: Wow. And what's the shift?

Raghav Gupta (Futurense & 1 % Club): Financial services, completely financial services, where the wealth management play is becoming extremely, extremely lucrative, not just from a business standpoint, but also from a reoccurring standpoint. Because once the customer is there, once you give them the value, they like to stick with you. In education, you monetize them once and it's done.

Utsav Somani: And you're the founder of Deserve on our show as well. So do you work on a mutual fund distributor model? We don't.

Raghav Gupta (Futurense & 1 % Club): So being true to our mission, we cannot work on an MFD model because we have always preached about a no commission kind of model, right? So direct mutual funds. So an MFD model works when you are looking at more robo-advisory. Because we have an RIA, we don't need to work on that. And we have multiple lines like insurance advisory. We have just launched a concierge service. So we created a new category around credit cards. I don't know if you've heard the credit card guy or the credit card master class we do. It's a new category that we created. And in that now we have a 15 people services team that is helping people use their points in an effective way. So people book a call with our team. Can you help me use my points in the best way?

Utsav Somani: So that's a very big business that has become a big business or I don't know, it keeps on popping up on my Twitter where people are getting flights, first class business class for free. It's insane.

Raghav Gupta (Futurense & 1 % Club): Because 95% of the people are subsidizing it for the 5% who are actually using it. So that's the plan.

Dhruv Sharma: Gaurav, anything to close us out? What's next? What's next Raghav for both of your businesses? What are you guys excited about?

Raghav Gupta (Futurense & 1 % Club): In future, I think the answer is very clear that we want India to become the AI engineering capital of the world. And for that organizations like us need to increase our scale and need to figure out a way to export that talent. So the future will of our business will be how do we create an entire supply chain that are able to export that talent that exporting can be in the form of services can be in the form of physically sending that talent. So that is from a future standpoint, from a 1% club standpoint, we recently acquired a company, it's not public yet, which is building the AI agent for money for your personal money. So basically, I don't want to just influence the way you invest. I want to influence the way you spend your money, your ideal cash, put it in a yielding bond, put it in a savings account, whatever it is. However, I can influence the way you spend your money. I think a co-pilot for your money, predominant.

Utsav Somani: Awesome. One quick one. Have you tried partnering up with the IAMs?

Raghav Gupta (Futurense & 1 % Club): Yes, yes, we have partnered with IAMs. But with IAMs, because they have been very business savvy from day one. And with IAMs, we do we just launched the MBA with IAM Sirmore. It's a regular MBA in AI MBA in AI from IAM Sirmore. It's the first time to offer an MBA in AI. And then we work with IAM Indore, IAM Lucknow, and IAM Udaipur on certifications. So we do work with them, but mainly IITs because that's where the core engineering audience wants to sit.

Utsav Somani: Awesome. Kudos to all the businesses that you built. Raghav, thank you for coming on the show. Appreciate it. Thank you, guys. Thank you. Yes. All right, folks. Now we've got two co-founders of Mecca joining us, Anand and Gaurang. They're going to teach us something about manufacturing and how India gets ahead of China. Gaurang, Anand, welcome to the show.

Gaurang Kuchhal (Co-founder, MEKR): Hey, itself.

Utsav Somani: Awesome. Are you guys both joining from different places? Yeah. I see all the products that you manufacture, I think, at the back. Awesome. So for our listeners who are probably hearing Mecca for the first time since you guys, I mean, sort of like work on a B2B model, tell us what is the business?

Gaurang Kuchhal (Co-founder, MEKR): Sure. At Mecca, basically, we are into manufacturing of home and kitchen appliances for some of the leading brands in the country. What we essentially do is we identify products that are import dominated, where India as a country is very import dependent. You know, those products are boxed by getting imported from China or other countries. What we do is we set up manufacturing supply chain for such products in our own manufacturing facilities and in parallel partner with brands by giving them that China-like experience in terms of quality, matching that China-like pricing, and solving the lead time for them, reducing their planning cycles, working capital cycle while manufacturing in India for them. We today work with brands like Burosil, Cello, Milton, Wondershef, all sorts of leading players in the category of home and kitchen appliances.

Dhruv Sharma: Nice. And why did you pick this particular category, Anand, to build a business in?

Anand Yadav (Co-founder, MEKR): So, I mean, we saw that India has sufficient manufacturing in the large appliances, people like Dixon, Amber, all these air conditioners, washing machines, these things are being manufactured in India. But this small segment, these small home appliances, the kitchen appliances, which Anand mentioned, even the personal care things, your hair dryers, trimmers, this is a big segment, big market. Yet there is no manufacturing happening in these segments in India. These are like 100% imported, box pack, all these brands are importing these things from China. So we saw this as a big white space and we thought, why not solve for it? We know how to manufacture these things, the technology we can sort of figure out and we sort of entered into this.

Utsav Somani: And when a brand comes to you, what is the journey like? Do they give you the product design and everything or do you design it for them also? And what other steps do they expect from you?

Gaurang Kuchhal (Co-founder, MEKR): Generally, these customers, they have a very large portfolio already, like there are 500 SKUs of different, different products. On the manufacturing side, a very few brands knows things. And even if they know, generally, they have such a large portfolio. So they focus on, let's say the 10 SKUs, top 10 selling SKUs of their portfolio. So largely, we have to act as an ODM for them. We have to work starting from the design to the mass manufacturing with the brand. Brand typically says very top level technical inputs with us. Yeah, over to Gaurang.

Anand Yadav (Co-founder, MEKR): Yeah, I think brand just gives high level inputs that I need, let's say a hair dryer, 300 rupees range. And if you supply to me, I can buy like 50,000 units a month. So these high level metrics we get, maybe a reference listing from a competitor or on their own product, which they're importing currently from China. So that's all we get. And then we work at the back end, figuring out the technology materials, what specifications to use, how to get things manufactured, set up the supply chain. And basically, final box pack unit is what we offer to them competing with their existing supply chain from India.

Dhruv Sharma: Could you give us a sense of the numbers and the scale in the business, guys?

Gaurang Kuchhal (Co-founder, MEKR): Currently, like this year, we are forecasting to close at some 80 crore in terms of top line, running the business profitably with EBITDA of 15%, PAT of 10%.

Utsav Somani: Yeah, actually, two of your investors were on our show also before. And we, I mean, of course, have interacted with Boris as well here and Weber of A Better Capital as well. I think Titan Capital, ex-Titan Capital, Bipin should be on the show as well. And they've spoken very, very highly about yourself and of course, the company that you've built. But how does India become China plus one? Like anyone who's been to China, I think the first experience is like, I mean, the first reaction is, wow, right? I think the scale is insane, like the talent and the, I mean, the work ethics and all of those things are so heavily in favor of China that making India the China plus one destination seems like it's going to be an uphill task in the manufacturing space. And given that we're sort of in this phase where I think Trump is forcing the world towards tariffs and de-globalization and stuff, so a lot of manufacturing will shift back to country as well. How do you think India can play this to an advantage? Or what should the manufacturers do here?

Anand Yadav (Co-founder, MEKR): Yeah, see, the transition is really happening. And as you mentioned, like what Trump did very publicly, imposing the tariffs and very publicly making sure that things become difficult for importing from China to US. Even the Indian government has done the same thing. Indian government has introduced BIS. Now, because of BIS, it has done very subtly. There was no hype anywhere that India is discouraging imports from China. But it's the same situation right now for like most of the product categories or most of the things that you see around in your homes. Those things will not be coming from China like six months down the line because the government has imposed BIS and now completely built units cannot be imported from China. So, I mean, just for comparison, like in 2014, you know, around 2014 timeframe, like 90% of the mobile phones were imported from China and just 10% were being made in India. By 2020, the numbers had flipped. 90% were being made in India and like hardly anything was getting imported. And now India is a very big exporter of mobile phones which are being assembled here in India. So, that transition, same story is repeating in all of the product categories that you see around us. So, definitely, it's like a very good time for the manufacturing industry. Things are changing, times are changing and that shift is happening. And because of the strong geopolitical situation, the strong tailwinds, the government push, the localization mindset and everything, that transition is very real. And definitely, I mean, the quality that is a given, like whatever you get in China, the product quality, the pricing, those things, everything can be done. It's just that people always found it so easy to go to China and work with the supplier and import things over there. But now, because of all of these things coming into the picture, things are pretty bright happening in India.

Dhruv Sharma: So, what do you guys say? It's not going to be an overnight switch that everyone just stops doing business with China because it takes time to kind of build capacity also. Can you take us behind the scenes and tell us what's changing in local manufacturing to give a boost to, you know, this call for Atmanirbharta? What's happening on the ground? You guys are practitioners, you'll give us a better answer than anyone.

Gaurang Kuchhal (Co-founder, MEKR): You see, very, very subtly, first of all, in terms of government policies, they have been very supportive, like Trump is putting tariff, but in India also, through PIS, etc, these policies, there is a heavy shift that is happening that is acting like a catalyst, like March onwards, brand cannot import box pack product, eventually the some parts will start manufacturing here in India. And then once the assembly starts, then the manufacturers start thinking, okay, these are, let's say, out of 20 different parts in a product in a bill of material, there are some parts which makes a lot of sense to do in India. So far in our learning, what we have realized is there are import dominated categories, you know, like there are mechanical heavy category products like sheet metal processing, plastics, injection molding, aluminum die casting, where India has a good strength today. And we can make products at part China like pricing, the raw material pricing is very competitive. Even the labor cost today in India is cheaper than China and so on. So a hybrid manufacturing makes a lot of sense today. There are some parts which may require a very heavy automation, which will take time for India to transition, but it is these things should be done in India. And that's what we are doing at maker.

Utsav Somani: And if you were to get a meeting with a regulator, any regulator, what will your ask be? Top three asks as a manufacturer in India, like what can they improve on?

Anand Yadav (Co-founder, MEKR): Today still in India, from an imports perspective, maybe, I mean, in for India to become just like China, the government maybe need to support a lot on the machinery side, the infrastructure side, like when we go to China, we see the government massively invests over there, like there are tons of industrial parks, the government setups the building and it is so easy like today in India, it is for us, it is easy to get a car loan or a house loan. But for a business to get a loan, it is very difficult. It is reverse in China. In China, it is slightly difficult to get personal loans or loans for going for vacations or these things. But getting a business loan is very easy. The interest rate in China is only two and a half, three percent. In India, we are currently getting rates of 12 percent, 13 percent. So cost of capital is very high in India. So, I mean, solving for all of these things, making import of technology, imports of machinery, all of those things, if the government can support in some way, maybe reduce the customs duties over there, support people who are importing machinery, because eventually these machineries will be used to make goods. So government can definitely discourage imports of completely built units, but need to encourage imports of machineries in India. Secondly, the cost of capital, cost of finance, that is very high from a global standard. India is very costly. Yeah, these are two things which come to my mind.

Utsav Somani: Anything specific in terms of compliances that is specific to manufacturing space?

Gaurang Kuchhal (Co-founder, MEKR): Actually, yes. I mean, today the process is not easy to run a compliant factory. There are a lot of hurdles, which can be better, of course, like starting from even taking a factory license, taking all sorts of registration, taking like we manufacture wing scales, all the weight related compliances, legal metallurgy compliance, those are very tough today. However, we think that it's an entry barrier also for us, because this is so tough, no one can easily get it, and so on.

Anand Yadav (Co-founder, MEKR): But it should be easy, of course. Yes, ours is a very execution-heavy business. It's not so easy, like there are regulatory hurdles everywhere, here and there, getting anything done in India, it's slightly difficult.

Utsav Somani: All right, Dhruv, anything to wrap us up with?

Dhruv Sharma: Yes, do we have more time with our guests? Do you guys have a couple of extra minutes? I actually want to try something. So you obviously deal with certain categories and certain products. What's the first one that comes to mind? I know there's an egg boiler or something, but you guys pick, just pick one product. Let's say hair dryers. So you picked hair dryers. So if one were to just, you know, like strip it down, how many different parts, how many different components does it have on average, like ballpark?

Anand Yadav (Co-founder, MEKR): Maybe 30 components, 30 different parts.

Dhruv Sharma: And so what you guys were saying is earlier it used be the case that somebody would go place a bulk order and just bring the hair dryer. Now, when we want to manufacture it locally, there are some parts that are available locally, but some we still need to import. We just don't have them around. Is that what you guys were saying? Yes, that is right. All right. And for the hair dryer, how much is available locally now and how much do we still need to import?

Anand Yadav (Co-founder, MEKR): See, Dhruv, what is happening is in India, like whenever we get any product, like a hair dryer, hair dryer, egg boiler, we really break it into fundamentals, the build of material list of like 50 components, 30 components. And these 30 components, we break it down. Okay. Out of these 30 components, 5 are plastics, 5 are sheet metal, 5 are imports, 5 are related to buyers. And for all of these components, we work with certain suppliers. Okay. Like for molding, we work with a certain supplier for mid-sheet metal for imports and so on.

Dhruv Sharma: You create like a sourcing chain and the raw material just starts coming to you. Yes. And have you plugged capital into this as well?

Anand Yadav (Co-founder, MEKR): Yes. Some parts of technology manufacturing, which so far doesn't exist in India, we have like shifted the technology machines from China to India at our own factories. And we do some investments there.

Dhruv Sharma: It's amazing. It baffles me every time we talk to entrepreneurs in the manufacturing business, right? The sheer complexity of the business. You need to bring so many things, assemble them over here. You've got labor, you've got plant machinery. Then you've of course got to like, you need supply chains to even just push this out. I mean, the build out, so to speak, is going to take a very long period of time. It's the road networks, rail, ports. It's going to be quite a journey, guys. You guys are literally the forefront of it. Last question, what's the future? What do you guys think about like on a three-year arc, five-year arc?

Gaurang Kuchhal (Co-founder, MEKR): Building like five-year down the line, really through what we are doing at Maker, really want to, you know, want India to be seen as one of the first manufacturing destination, not the last in the coming years where, you know, top-notch quality products are being manufactured. Very SOP-driven factories, tech-first factories are here. That's the long-term vision. Indigenize supply chain of various, various products, which are still imported in India.

Anand Yadav (Co-founder, MEKR): Not only for India, but for the world, actually. Today, we are at a position like in India, if you compare India versus China, today we are at a much stronger position in terms of workers. Like today, the worker salary in India is x, the worker salary in China is 5x. So, China has actually gone in the curve at a point where they have become more costly today. We really don't, I mean, it's a myth people say, think China is very cheap. It is no longer true. We never feel any pricing pressure. It is easy for us to meet China pricing. It is just we need to build the SOPs and like set up the infra over here so that we can build China-like products out of India for the world. That is the vision.

Dhruv Sharma: And make it easier to run a manufacturing business. But more power to you on this journey. It's going to obviously be a multi-decade journey and off to a really strong start. Yeah, it means a lot.

Utsav Somani: Awesome, Anand, Gaurang, thank you so much for dialing in. All the best.

Dhruv Sharma: Thank you so much.

Utsav Somani: All right, listeners, hope you've learned something new from these solid, solid founders that you heard from today. And we'll see you on Friday at four o'clock. Thank you.