redBus.in is an interesting service that e-enables bus ticketing across major states in India. I must say that redBus.in is a gutsy attempt to e-enable a low-margin service which is highly fragmented as well as offline (how many bus operators know about Internet?)
Here is presenting our interview with Phanindra, CEO/co-founder of redBus.in. What’s really amazing about these guys is that the entire founding team is very young and have taken up a huge challenge (and I am sure this interview will inspire those who are still wondering whether to startup or not!)
If you have questions/comments/feedback for Phani, please leave them in the comments section.
Please tell us more about RedBus.in and the services you offer.
redBus is India’s first organized bus ticket booking service. With services in 15 states, sales offices in 6 locations and daily departures in 2800 routes, we are India’s largest aggregator of bus tickets.
Below are our USPs.
- Customers can choose their seat – facility which is unique: none of airliners / railways offer this facility.
- Customers can book return tickets – facility not available at the traditional brick and mortar agents.
- Multiple bus operators.
- Standard fares.
Please tell us about the founding team (educational background/work-ex etc. )
redBus is founded by 3 of us. Sudhakar, Charan and me.
Sudhakar – 26, B.E (Hons) EEE from BITS-Pilani, 4 yrs exp. at IBM, Bangalore.
Charan – 27, B.E(Hons.) EEE, M.Sc (Hons) Physics from BITS-Pilani, 3 yrs exp. at Honeywell, Bangalore.
Phani – 27, B.E(Hons) EEE from BITS-Pilani, 4 yrs at Texas Instruments, Bangalore.
Why did you pick the bus ticketing domain (given that airfare/train fare is relatively cheap – and the online reservation is primarily done by IT crowd (with surplus cash)). Do you see this as a huge volume business?
redBus is an organized bus ticketing service provider. We are not just OTAs. We have other channels like home delivery, ticket distribution partners like Sify iWays etc., We are working on improving the customer experience while he books a bus ticket – an industry which has never been considered seriously by anyone till now inspite of bus being an everyweek necessity.
Given a choice, people (IT as well as non-IT) will opt for convenience – especially if it comes at no extra cost! Infact we are seeing that the customers started demanding eg., if the response to a ‘customer request’ is more than 4 hours, he cribs. This is very encouraging J
As people get used to convenience, the volumes will grow. It is definitely a huge volume business with 1+ billion customers – considering that all Indians travel by bus atleast once in a year.
Even bus service providers (like KSRTC) have their own outlets (and sites) – where do you see RedBus has a differentiator.
KSRTC going online is not competition to us. We are not a OTA. Our website is one of the options we have for our customers. We provide a whole new ticket reservation experience to our customers including multiple bus operators (KSRTC as well as private busses), a variety of departure times, fares etc,. which gives us competitive advantage.
What’s your target market?
I know I can’t say that we are targeting everyone J ! But we receive very good sales from IT crowd on the web. Most of the calls at our call center are from home makers and elderly who look for predictable quality of service. And the sales through our partner networks cater to business men who travel by bus on business trips.
How do you guys get the real time seat availability information from service providers?
Most of the bus operators are not computerized. Hence there is problem in getting real time inventory from them.
Our model is similar to that of hotel inventory. We block about 10% of the inventory in all busses of our partners till 1 hour before the departure time. Some of our partners are computerized now and we are taking webservices from them.
What are the challenges you see with the current state of the Industry?
The misconception of low entry barrier in what we are doing seems to be a problem. After we started, a lot of other people also started similar services – may be with the understanding that all it takes is just a website and partnership with bus operators. Today you can find atleast 25 websites offering bus tickets in India!
Some of them have been undercutting prices, doing variable pricing, changing the commission structure etc.,. The absolute commission per ticket being very small, it is really a high volume game. Without reaching a critical number, any of these undercutting does not work. It would just be sprinkling the VC money in the market. I personally feel that the industry is not ready for any such things right now.
These are some of the temporary yet painful challenges.
Please share some of your future plans. What are your plans w.r.t PAN India presence?
We are looking at 3 more locations by the end of this year. These locations will put us PAN India pretty much. Currently, with our offices at 6 locations we cater to about 15 states.
In future, do you see RedBus having an offline ticketing system/kiosk?
Yes. Very much. We are planning it out.
Please share a few key learnings/experience after starting up.
It is completely a different world we live after we start on our own. Things change everyday and we have to keep up with every change. One of the key learning that I have had is that it is a must to have a well experienced advisory board, atleast for first generation entrepreneurs. I am surprised at the number of occasions where we could have made wrong decisions otherwise. Today where ever we stand, it is because of the timely mentorship of our mentors and investors.
You guys started up at a very early age: your tips to wannabe entrepreneurs who are still holding back?
I would say that entrepreneurship, unlike any other traditional profession does not need a definitive skill set. What I mean is, to get into TI (my prev. company) one needs to know about transistors, voltage, current etc., similarly to do software, one needs to know oracle, java etc,.
But for entrepreneurship, one just needs to have a strong will power and a good advisory board J I have met so many entrepreneurs who just wanted to do what they want to do and they get every other skillset in the market. It is not necessary that one needs to know internet technology to start an internet based company.
So go head and start your venture. Everything will fall in place, if you have the will power.