<div>He’s a spitting image of his father. One would have expected <strong>Kavin Bharti Mittal</strong> to be part of the leadership team at Bharti Airtel. But Sunil Mittal’s son decided to be an entrepreneur. In October 2011 he led Bharti Enterprise into a joint venture with Japan’s Softbank Corp to offer mobile Internet services under Bharti Softbank Holdings (BSB). The focus was on social media, gaming and e-commerce. He launched mobile messaging application 'hike' in December 2012. Soon after it crossed 5 million users, BSB invested $7 million. With over 1 billion messages on the app every month, the aim is to hit 10 million users soon.<br /><br />Hike has just launched Stickers and Walkie-Talkie basically to ensure that you type very little on the smart phone. It has also improved privacy levels by restricting the Last Seen to just a circle of friends. Kavin Mittal, head of strategy & new product development, BSB spoke to <strong>BW| Businessworld’s Anup Jayaram.<br /><br /></strong><em>Excerpts:</em><br /><br /><strong>You have over 5 million users now. What is the profile of the 'hike' users?</strong><br />The profile is mixed — half male, half female. But our target demographic is the youth. We believe that a lot of the features that we are building today are targeted at the youth who much more than simple messaging. That’s definitely our target market.<br /><br />I<strong>t’s fine to have over 5 million users. How do you plan to monetise 'hike'? Do you plan to have tie-ups with telecom operators for this?</strong><br />We are working on a bunch of different things. Before we go and figure out how the business model works, we have to figure out our product. We are almost there. When we get to 10 million active users, we’ll be at a point to know what the user wants, based on which we will craft our business model. The relationship with telecom operators is different. We believe that the only way to monetise micro transactions is by partnering with the telecom operators. We are not going to put out advertisements. We feel that there is no point putting advertisements and spoiling the fantastic experience.<br /><br />If you look at what messaging apps are doing in the East, more than half of their revenues comes from games. That is something we are looking at very carefully in 'hike' and BSB as well also. We’ll be announcing our first game in July. We’ve got very cool stuff around music and games.<br /><br /><strong>What is the advantage of 10 million users? How do you plan to compete in a space where there are well established players like WhatsApp and BBM?</strong><br />Ten million is the new one million. In a world where we have billions of smart phones, the number becomes very large. That’s the target we have in mind for now.<br /><br />I do feel that messaging will be diversified globally. You already have Tencent and WeChat in China, Line in Japan and Kakao in Korea. You have us and WhatsApp popular in India. You have WhatsApp in Europe. So there’s a lot of competition. And I feel that it is always going to be there especially in emerging markets. The question is who succeeds. The people who cater to the needs of that country will have big advantages,<br /><br />For example, the 'hike' Offline feature is very complex. It allows you to communicate with friends even when they are offline. We feel there will be six-seven messaging apps across the globe. If you look at where the messaging sphere has gone, people are using more than one app. There is a lot of overlap. Fundamentally people have one address book, but there are different value-adds in different messaging apps.<br /><br /><strong>Do you see a situation where you can send a message from one app to another?</strong><br />The asset that a company like us has is our users. So why expose that to anyone else in a messaging world. That is why I feel that people will have multiple messaging applications. In most countries there is usually one dominant messaging platform like Line in Japan and KakaoTalk in Korea. Our goal is to be the Indian platform. We are confident on the basis of our numbers and the missing blocks. We have been listening to the market for the last six months.<br /><br /><strong>What are the new things that you have introduced now?</strong><br />People find it difficult to keep typing on their smart phones. So, we have introduced beautiful stickers, which express a lot. That same applies to Walkie Talkie. It allows you to send a voice message to friends. But the most important thing we have introduced relates to privacy. In most applications, the Last Seen is visible to everyone, especially girls. So how can they cut them out? What we have done is restrict it to a circle of friends. That improves privacy levels.<br /><br /><strong>How many people are there in your team?</strong><br />We have 45 people, of which 40 are engineers and product guys.<br /><br /><strong>How did you achieve initial growth considering that 'hike' was not really known?</strong><br />A lot of the growth that we had initially was from a very smart referral scheme called TalkTime Rewards. If you join 'hike' you get Rs 10; if you invite a friend you get Rs 20 and the minimum you can redeem is Rs 50. Some people thought we were crazy to do this. We realised that the cost of acquiring a customer was $2, that’s Rs 110. Let’s say I acquire a customer, I do not know whether I can get back my money. Rs 110 is a large amount in India. Second, in 'hike', you inherently need friends and services. So you can’t acquire only one consumer. The idea was if you incentivise friends, then he will get friends. And the cost of acquisition came down to one-tenth. That’s money we can make back, sooner or later. There has been some churn.<br /><br />We’ve built in some smart things—like the ability to share Stickers seamlessly to Facebook and Twitter if you want to. Look at the stickers. They are so beautiful and expressive. I have a feeling that the world is going that way. Typing is tedious. I think it is phenomenal. Time will tell. A messaging app has to be word of mouth driven. We plan to do some marketing activity towards the end of the year. We’ve already offered free auto rides to students at Delhi University. Hopefully, we would take that pan India, if we have the budget for it.</div>
