Knowlarity Banking On 'Packaged' Cloud Telephony To Crack Open SME Market

3 Apr, 2012

In a volatile economy, enterprises are all too keen to offload non-essential costs and nothing can help them better than custom Cloud telephony solutions. With a virtual business phone system up in the Cloud, one can simply do away with hardware and software installations, licensing fees, upgrades and the need to hire someone to keep the on-premise phone systems running. Gurgaon-based Knowlarity Communications Pvt Ltd, a Techcircle Fastracker (2012), ensures just that and more, offering a suite of hosted voice applications for call tracking, call notifications, call forwarding, call automation and interactive voice response (IVR). Understandably, these convenient tech tools help SMEs cut costs as they manage, measure and automate voice communications.

The idea occurred to Ambarish Gupta, co-founder of Knowlarity, when he developed an easy-to-use accounting software application for his father with a built-in telephony feature. A tech enthusiast from his college days with a keen desire to cater to the SME segment, Gupta felt that Cloud-based telephony solutions would be the right kind of cost-effective apps to help businesses operate efficiently without investing in expensive capital outlay. But in spite of the concept and the technology, he was not too sure about the marketing part of the business. Finally, Gupta decided to join forces with Pallav Pandey (his classmate at IIT Kanpur), who was also the founder of Viplav Communications (a political consultancy, technology and management services company) and had the first-hand experience of running a venture. Moreover, Viplav brought modern, enterprise-quality market research and decision-making to the crucial and highly interactive political space – an expertise which was bound to spell success for a business. So the two joined hands and Knowlarity was born.

The Journey & Expansion Plans

In 2009, promoters of Knowlarity started operations with an initial investment of $2 million, raised from friends and family. Again in January 2012, the company managed to raise $6.6 million from Sequoia Capital, planning to strengthen R&D activities and grow marketing operations.

Knowlarity will now expand its technology team to focus more on product development, which will help in scaling the platform to handle large call volumes that the company foresees in the future. Along with scalability, it has a roadmap to churn out more products for automating key processes of enterprise customers. The company also intends to increase its sales force to reach a wider set of businesses across the country.

As for the revenue model, Knowlarity charges each customer a pay-as-you-use fee and one can opt for a service pack for one month, six months, one year and so on. "Customers should use our services first to get the hang of it and feel comfortable. Only then they should go for long-term packages," says Gupta.

But what's the exact cost-benefit ratio when SMEs opt for Knowlarity's customised solutions? The answer might be a little staggering for the uninitiated. Traditional telephony solutions require hardware setup and maintenance – thus amounting to huge costs for a startup or even an old but small firm. In contrast, the Cloud telephony firm offers hosted solutions that essentially do away with technology deployment, distribution and pricing issues. The selling point for Knowlarity is (what it claims) the cost-benefit ratio of 3:1000, which is extremely crucial for businesses in the emerging market.

It is, therefore, not surprising that the company has managed to break even within six months of being operational. What's more, it claims to be growing at a rate of 40-50 per cent month on month and targets 0.5 million SMEs by the end of this year.

Knowlarity is also eyeing foreign shores where it is bound to face new challenges. "The major challenge will be replicating the same business model across different global scenarios," admits Gupta. That is precisely why the firm wants to make foray into Indonesia first as the concept is catching up there and the emerging market offers a lot of scope. It will also set up new offices in the Middle East as part of its global expansion plans.

Know Knowlarity Products

SuperFax: Internet-based fax solution that provides the flexibility to send and receive fax messages via e-mail. The company provides a phone number, which is mapped to the user's e-mail id.

SuperReceptionist: Hosted PBX system for businesses sans front desk. The automated phone-answering solution uses an IVR application to track calls and generate customised call logs.

SuperConference: A standard and inexpensive conference calling system where all employees can call a local number to join the conference. The con-call can be recorded and made available as mp3 download from the website, saving the hassle of taking notes.

SuperCaller: A hosted IVR tool that can be attached to a phone number and played in response to an incoming call. Alternatively, it can be used for outgoing calls and can support large (1,000-plus) number of simultaneous connections for both outgoing and incoming calls.

API Versus 'Packaged' Solutions

The Cloud telephony industry is still at a nascent stage in India, but is expected to grow in the coming years with enterprises shifting towards 'lean' structures and therefore, Cloud-enabled products. Of course there are other Indian players like Ozonetel and Exotel, which provide similar services as Knowlarity does. However, most of these players focus on providing application programming interfaces (APIs) and expect the developer community to design solutions using the same.

"But we feel that this might be too early for Indian enterprises that need packaged products to address their pain points. And that's where we have had a head start over our competitors. Knowlarity will gradually promote its API as the market and the developer community become more mature and that will also contribute strongly towards our growth," explains Gupta.

Global players like J2 Global and Twilio do not pose any immediate threat to Knowlarity either. International firms mostly support VoIP which has limited scope here. Currently, Indian laws only allow VoIP calls to a telephone in India under strict conditions. But such calls are allowed between computers within the country's borders and between a computer in India and a telephone (fixed or wireless) outside India. The situation may soon change, though, as on March 6, the Telecom Regulatory Authority of India (TRAI), in its final recommendations on the National Telecom Policy (NTP), suggested that VoIP be fully allowed in the country. However, most of the global companies do their business online and it might be difficult for them to sell in developing countries like India where majority of the transactions are done offline.

So what's the bottom line for Knowlarity as of now?

"We want to build a brand that customers would trust," says Gupta. "Our innovative products will help acquire a good many customers while we increase the ticket size through cross-selling. You can lock in even more clients if you offer customised solutions and provide support from local partners to ensure value addition," concludes Gupta before signing off.