The wild ride of a college dropout turned internet entrepreneur

2022 has been a crazy year for Siddharth Rao. Dentsu Creative Bengaluru, which he headed, won Agency of the Year at Cannes – but Siddharth left to start something new. It’s all part of a long entrepreneurial journey that began in his 20s.

July 2016: “Make us famous.” That was the exact instruction Siddharth Rao received from his new boss, Ashish Bhasin, who had just taken over as head of Dentsu Aigis in India. In 2013, the international advertising network acquired Webchutney Studios, an online agency founded by Sidharth (with Sodesh Samaria).

Cut to July 2022: Dentsu Creative Bengaluru (formerly Dentsu Webchutney) is the first agency from India to win Cannes Lions Agency of the Year, arguably the highest honor an agency can hope to win. The victory was achieved thanks to a campaign created by Siddharth’s team: The Unfiltered History Tour for Vice (a US-based news website). Created during the worst of the Covid era, the film focuses on objects stolen from around the world that now reside in the British Museum.

Sidharth – “Sid” to everyone – gets a message from Bhasin right after the win. In short, the main command is: “You delivered in the brief.”

Ironically, Syed had left Dentsu a month before this great victory. Does he regret not being on the international stage?

“Oh, not at all! I can’t take credit for the Unfiltered History campaign other than green-lighting the project. Webchatney has won major awards over the years, but I’ve never been on stage. He had already decided to quit and it didn’t seem like he was going to just stick around for Cannes and quit a few months later. It made Dentsu look bad—and he owed the network.

A pause “Actually, I don’t even consider myself an admin. I consider myself an Internet entrepreneur.”

For the past 23 years, this college dropout, the son of a major general in the Army, has had it tough. “I almost gave up a few times along the way,” he admits.

His story is very entertaining in the way he tells it. It involves downplaying hard work while highlighting your mistakes. That’s just Sid’s style. Maybe it’s because he suffers from “betrayer syndrome,” something he admits to? This condition is defined as “feelings of inadequacy despite apparent signs of success.”

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After school, Sid asked his parents for permission to take a year off while he explored his options. He joined DDB Mudra at the age of 19 and later moved to Gary for a short time where he was fired. I met him around 2000, when we were starting up the agency! (now Afaq!) and was putting together Gutterspace, a site in the same space. It sounded interesting – “Better than the Fox Agency!” He gently teases me – and this led him to the task of creating websites for companies. This is how WebChatney was born.

At the age of 20, Siddharth was leading his team from the front

At the age of 20, Siddharth was leading his team from the front

He collected 11 million rupees while he was 20 years old. He scoffs at the amount now, but I think it’s remarkable that a young person could raise money in India at that time. The entire country had less than half a million internet connections.

The Internet was still in its infancy and WebChatney was among only a few creative agencies. It won its first Blue Gold for the MakeMyTrip campaign, which went viral before ‘viral’ was even a thing. But finding the cash to grow was a constant headache.

When it was decided in 2005 that the webchat should be part of an advertising network, there were many suitors – “Hamare Suyamor, the original sub-verse”he recalls with satisfaction. While a big deal did not materialize, he attracted an individual investor for Rs 60 lakh.

He sorted out the immediate money woes, but that particular dark cloud still hovered: he didn’t have enough cash to expand. “And that’s when I dug myself a nice, deep hole,” Sid reveals.

The hole was dug when Webchutney, a creative agency, made a media buy for MakeMyTrip in 2007. Bought media worth Rs 1.5 crore per month, which was paid up front, but was able to get a 120-day credit line from Google for advertising. . This gave the agency a strong short-term positive cash flow that it could use for growth.

But Syed, only 28 years old, did not have much financial discipline. When MakeMyTrip decided to shift media buying to an ad network and thus canceled the deal with Webchutney, the agency didn’t have the cash to settle the bills. Sid had 21 days to find the money. Or close the shop

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In a dramatic move, Sid vowed to his desperate team that “I’ll find the money – and I won’t change my shirt until I do.” That’s how he wore the same shirt for 21 days straight – “even though I washed it every night” he hastens to explain as I wrinkle my nose.

He worked incessantly like a man with a few days left to live. Syed is grateful that Ajith Balakrishnan of Radif offered the investment so quickly. Looking for a better option, he contacted Harsh Chawla, Group Managing Director at Viacom18. Time was running out and the two quickly signed a deal: Capital18, the group’s investment arm, would invest Rs 8 crore for a majority stake.

The web chat studio had survived.

Syed can’t stop praising Harsh, who he now refers to as a close friend and mentor, as well as Capital 18’s then-head, Sarveer Singh. “They were like new-age parents. They trusted me and let me fly. That’s how my belief in myself as an entrepreneur and angel investor grew.” (Syed has made about 20 angel investments so far.)

It was an informal relationship based on trust. And when things went awry, it made Sid earn a sharp rap on his knuckles, often at Toto’s Garage, a Bandra pub.

All in all, it seems to have worked. By the time Capital18 exited Webchutney in 2013, it had earned 3 times its investment, according to an official statement at the time. According to Syed, this does not include the 12-fold return Webchatni made on its Rs 2.5 crore investment in Network Play, an ad network that was subsequently acquired by German media giant Bertelsmann.

Webchutney Studios’ new partner was Dentsu, then headed by Rohit Ohri. What change did the change of ownership make in his life?

Not the answer I expected.

“Dentso was placed in a financial manager, Benny Augustine. Honestly, I was skeptical at first. “But over time, I realized that instilling financial discipline in a weirdo like me was a game-changer.” Profitability started increasing year on year: Last year, Dentsu Webchutney/DentsuMB achieved approximately Rs 80 crore with an EBIDTA of around Rs 32 crore: Things can’t be better than a 40% profit margin.

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His approach to running the business also changed. For the first 14 years, I did my job. But gradually I began to embrace the concept of “lazy entrepreneurship” – that is, hire the best people you can and walk away. I found myself as the main HR guy at Webchutney.

And to invest his angel. Many of them were ahead of their time. A few examples: Crude Area, an online platform for selling graphic art. Bombay Bitch, modeled on the American gossip site Gawker; JuxtConsult, an online market research firm that wanted to be ComScore for India. The old adage that “timing is everything” is not far off.

Here’s what I’ve learned about investing: only bet if you know the founders well. Otherwise, join the big boys and think where they invest. While most investments have panned out, his big hits include Pepper Content and ScoopWhoop, each of which he claims has earned him a 20x return.

He’s also bullish on two other companies he’s invested in — Invideo, an online video editing platform, and Lio, an app that helps small and medium-sized businesses organize their information. “You’re going to hear a lot about both of them,” he promises.

What drew him to angel investing? Is it money? or what “It’s the thrill of creating something new. To be honest, I also feel honored to work with such talented entrepreneurs.

Sid is currently creating what he thinks will be his next big thing. For, as I have found, he can never resist a blow. So it’s no surprise that his new venture is called Punt Partners, which he co-founded with Bengaluru-based serial entrepreneur Madhu Sudan.

The duo’s main premise for Punt is that advertising agencies have been helping businesses win customers over the past century through the use of advertising. In contrast, marketers do not have an equivalent advertising agency to help them retain customers during a period of choice. All marketers have is an array of tech companies offering different types of maintenance tools. If Punt has its way, it will be the most important customer retention agency for marketers.

This is interesting work that I expect to hear a lot about in the coming years.

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