Fourth time lucky.
Before IIT Bombay alumni Ritesh Arora and Nakul Aggarwal hit upon the idea of founding BrowserStack, they were struggling with a peculiar problem. While working on a consulting project at their third startup Binary Life Technologies, they faced problems when they had to test different versions of the website on different browsers. Though armed with a Macbook but working on Internet Explorer with a 2G speed, downloading all the versions and testing them all took Ritesh some four days alone.
“I realised it was a very cumbersome process. We had faced similar problems in the past and that’s where the idea started,” recounts Ritesh.
In 2011, the duo went ahead and launched BrowserStack as a mobile and web testing platform which would enable developers to test if their website is working properly on different browsers.
Any web presence has to work across multiple browsers (Windows Internet Explorer, Apple Safari, Google Chrome, Mozilla, Opera etc.) and on multiple platforms (desktop, mobile, tablet, laptop etc.). Each combination of browser and platform has its own nuances and the user experience can vary on each browser or platform if the web presence is not tested properly by the developers.
Says Ritesh, “Your developer will need access to all these mobile devices and various browsers. And that’s what BrowserStack provides. The company’s product helps eliminate the pain of manual and automated browser testing, so that developers and users can focus on building better products and deliver seamless user experience to Internet users.”
It’s no wonder that it was a hit with developers and freelancers initially engaged in making websites and mobile apps. Today, of course, its clients are fairly distributed across the entire ecosystem. For instance, one of its top users is Cosmopolitan magazine, which uses BrowserStack before publishing each and every article.
Deepak Dhanak, CFO at BrowserStack, adds, “When we started we had a tilt towards individual developers and freelancers. It being a very closed community, word spread around and, without us pushing our product in the market, we grew for a year before we actually started investing in our sales and marketing infrastructure. So, now the balance is fairly distributed – starting from freelancer to SMEs to enterprises. But because now we are making more efforts to reach enterprises, they will form a sizeable portion of our customer base.”
36,000 Paying Customers, 1.6 Mn Registered Developers
Almost 5.5 years after its inception, BrowserStack now boasts of over 36,000 paying customers spread across 135 countries globally, with over 90% of its customers based out of developed countries. Over 1.6 Mn registered developers across the globe use the platform which includes corporates, freelancers, small, large, and medium enterprises, and global MNCs.
Adds Ritesh, “We have more clients outside India, as the world’s biggest apps and websites are owned by people in the developed countries. So, obviously users are more in developed countries. Secondly, the tendency to pay for software is much higher in developed countries as compared to developing countries.”
And that is well exemplified by the revenues. Ritesh claims that revenues over the last five years have consistently grown 100% Y-o-Y. While no exact figures were quoted, they are estimated to be over $30 Mn in annual recurring revenue. The startup offers a subscription-based product for which clients can pay monthly or annually, starting from $29 a month.
But How Big of A Challenge Was Selling From India?
Says Ritesh, “Initially, it was easier to sell to clients outside India as everything happened on the web. But, I think, as you grow bigger and bigger it becomes difficult to serve global clients out of India. This was one of the reasons that, a few years back, we went out to set up offices in Dublin and China.”
Which brings us to the recent expansion in Dublin to set up and operationalise a mobile data centre as a part of their ambitious expansion plan. The company intends to increase its data centre capacity by 4-5 times from the current level in the next 1-2 years by creating 40 new jobs to serve the customer growth and also cater to newer products that are in pipeline.
Deepak sums up the rationale behind the expansion, “This is a global product and requires a global infrastructure. When you are putting your product on cloud, two factors are most important – one is the quality of the infrastructure, the connectivity and second is the response time that you offer to your customers. In Ireland, we have the data centre where we host our mobile devices. Ireland offered a phenomenal infrastructure and connectivity. Also, being part of the EU, the labour movement and workforce movement is much easier. Additionally, it is emerging as a good tech hub because of government initiatives and strong support to tech companies landing in Dublin. Hence, the whole ecosystem and talent pool is much better based on our experience of many other places.”
Interestingly, all this has come on the back of the company’s profits alone – prompting it to stay bootstrapped all along, despite receiving numerous funding propositions.
“We have been profitable from the beginning. We have always been able to fund our growth by our profits. So we are not motivated to go for funding from outside,” Arora said.
But would things have been different had it chosen to be VC funded?
Ritesh doesn’t believe so. He says,“ In my view, our growth path would not have been much different if BrowserStack was funded by VC/PE. However, definitely, with a strategic investor on our side, we would have matured faster and the growth achieved in the last five years of our journey could have been achieved in three years.”
Gunning For 10x Growth
When it comes to the competition, BrowserStack believes that it has few competitors globally in Europe and US but none in India. There are, of course, many browser testing tools available like Browsershots, Sauce Labs, Browsera, and TestingBot among others.
“It is a very technology-heavy product, needs a lot of research that no player has been able to do successfully,” explains Arora.
Having said that, he acknowledges that despite the presence of global giants in the software and infrastructure space, the real competition is from the open market where people are trying to do browser testing in-house. “The entire world is moving to the cloud and we have to move the entire testing infrastructure to the cloud,” he sums up.
Adds Deepak, “It’s a technically niche product, purely B2B, and not much-talked about. The biggest of companies such as Google are spending millions of dollars every year in setting up infrastructure around it but it can be done in a few thousands of dollars by us.”
No wonder, the startup is hoping to grow revenues by 10x in the coming three years. But its ambitions are equally tempered by caution.
“We don’t want to run after topline like any other company in the world but create a company that’s a formidable player in the long-run. We want to balance out growth with profitability and investment in creating awesome experience for our customers,” explains Deepak.
Thus, in the pipeline are two new products – a mobile app testing platform and gearing up for launch in the coming two-three months, where the Mumbai-based company sees a huge opportunity.
It is for this reason alone that Ritesh recounts launching mobile on BrowserStack as a huge turning point. And while the company started as web browser testing platform, in recent times, mobile app testing is growing explosively.
The World Goes SaaS-Y
“India as a SaaS market is growing rapidly. And at the same time, the entire world is also growing very rapidly towards SaaS. But I think the developed countries always take a front foot in adopting these technologies.”
Thus, for BrowserStack, developed countries are still going to be a major source of customers and revenues.
However, as far as growing structurally is concerned, Deepak believes that BrowserStack is well equipped to serve even 10x of the customer base with its current infrastructure.
“We don’t need to be physically present in the countries we are targeting as we have a cloud-based product. The only presence we need to build is a strong infrastructure at the point where customers are or are nearest to them. In the near future, we don’t want to expand right now into any new territories. We would want to grow from where we are, hence no new expansion to new countries in next couple of years.”
Given that it already has a customer presence in 135 countries, maybe it doesn’t need to bother about expansion. But for anyone aiming to build a global SaaS startup from India, Ritesh believes one of the key ingredients is getting the right exposure.
“Besides being highly customer-centric and having a focus on global strategy, the other most important thing is getting the right exposure. I have met founders who want to build a global SaaS product and have not met even one of the global customers. Their expectations are far different from what we can imagine sitting out of India.”
Coming from someone who has scaled to more than a century of nations, those words are right on the mark.
[This article is part of Inc42’s SaaS series where we will be covering different aspects of SaaS in India and abroad.]