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iYogi the first Consumer Services brand from India
Vimali Swamy
Thursday, December 2, 2010
Brands are not created everyday. And the attributes that have created successful global brands like Fedex, Starbucks and Nike are driven by reliability and consistency, while creating an emotional engagement with the consumer.

For Jai, a tech support executive, a day at work means handling multiple sessions from customers in the U.S., Canada, United Kingdom and Australia that are challenged by the increasing complexity of technology in their home. He is true to his name and background -- he is Jai Sharma from India who is happy and proud to help customers around the world. This is the case with each of the 4500 tech support executives working with iYogi, across its eight delivery centers in India, providing tech support directly to customers. It is the first direct-to-consumer services brand from India, providing remote tech support services to home and small business customers.

Indian outsourcing gathered steam when large teams of Indian call center staffers with made-up names and personalities would answer your customer service call for big charge on your credit card. It took the world by storm and saved millions of dollars for many western companies. But no more. Now a new company, iYogi, is taking the global tech support market by storm with a different business model that embraces its Indian roots and brand, while leveraging superior tech sophistication, expertise and its proprietary platform to remove user frustration. The end result is great tech support at a great price. “We were clear from day one on our goal to build the first global consumer services brand from India,” says Uday Challu, Co-founder and CEO, iYogi. “Using the powerful combination of remote Internet access and our global delivery platform, iMantra has enabled us to make a real difference as our own brand, not as a disguised third-party service under a big-brand umbrella.” Today when a customer in the U.S. calls seeking technical support he/she knows that she is talking to someone from iYogi about 14,000 kilometers away in India.

According to the U.S. Census Bureau data, 117 million Americans who are above the age of 45 present a ready market for direct-to-consumer tech support. iYogi, a tech support startup, spotted this need early and cashed in on it. Founded by techie Uday Challu and marketing professional Vishal Dhar in 2007, iYogi is the first direct-to-consumer services brand from India and recognized as the fastest growing remote tech support provider in the world. iYogi deploys a 4,500-person operation on its global service delivery platform answering tens of thousands of complaints every day from technology users, mostly in the U.S. The company has managed more than two million tech support sessions since inception and today it handles around 20,000 support inquires ever day. iYogi has more than 325,000 customers in the U.S., UK, Canada and Australia, who have subscribed to annual contracts for round-the-clock service for their PC’s and multiple devices that are serviced across eight delivery centers in India including Gurgaon, Pune, Hyderabad, Bengaluru, Chennai, Chandigarh, and Kolkata

The Genesis

The company was founded when Challu and Dhar met on a flight and quickly found they could work together on entrepreneurial ventures. Challu had earlier run a third-party desktop support business in the 1980s but shut it down because it proved to be ahead of its time. But now, he sensed the emerging opportunity in reviving that business in a modern form.
Borrowing from the outsourcing model of charging dollars per hour of work, the two created iYogi as an Indian brand that sells tech support services online to users of computers and other gadgets in the developed world. They also used the cost advantage to compete with several US firms such as Geek Squad. Providing a subscription-based service, a first-time caller is offered a one-year package costing from $10 per month per computer to a flat rate of $399.99 per year for multiple computers in a home or small business. The service available anytime, allowing unlimited on-demand access to tech experts that are extensively trained to manage almost every situation. iYogi’s platform-as-a-service offering is delivered through iMantra, which integrates complex layers of technology, processes, services, and a unique proprietary knowledgebase for a seamless experience for customers.

The Differentiation

So how is a four-year old startup disrupting the outsourcing space that has been dominated by the likes 24/7, Progeon, Genpact or companies like Accenture who have had their support centers set up in India. For one, you won’t find a technician adopting a false persona while handling customer calls. Secondly, it has invested in building a scalable delivery platform that provides a consistent experience in a new service category – third-party vendor independent tech support. iYogi offers comprehensive support for a wide range of technologies, including hardware, Windows operating systems, software, peripherals and multi-functional devices.
For iYogi, the business partner is the individual customer who calls and not a US headquartered MNC. “Unlike an outsourced customer support centre for computer vendors, technicians at iYogi take support calls because subscribers have opted for our comprehensive one-stop solution,” says Challu.

iYogi’s service offering provides subscription-based tech support plans for digital homes and small businesses. Its global delivery platform, iMantra, combines a suite of desktop applications called Support Dock with on-demand tech support delivered through proprietary technology infrastructure and its patent-pending processes which provide both scale and a consistent experience for customers. Highly optimized processes combine iYogi’s unique triage model with tools that proactively manage technology for its customers and reduce time for delivery.

“Support Dock is a suite of desktop applications that provide on-demand tech support and single click access to manage, optimize and secure computers and networks and proactively manages the health of the machine,” explains Vishal Dhar, Co-founder and President Marketing, iYogi.

Through its proprietary platform, the company addresses the large and ever-growing market of digitally dependent consumers and businesses across a comprehensive range of technologies. It currently manages thousands of customer interactions every day and assists consumers with solving, managing and integrating technologies. iYogi also helps customers migrate to new technologies and cloud applications, and empowers them with usability assistance. A seamless integration of voice and data, combined with iYogi’s knowledge base and personalization engine, forms the infrastructure layer of its platform. Built on industry standard platforms, iYogi’s infrastructure has demonstrated scalability through its years of rapid growth.
“Consumers today are expected to play the role of a system integrator. With growing dependence on technology and the increasing number of PCs and devices that need to speak with one another, consumers are trying to build networks for the new digital home. Along with these challenges, the consumer is also faced with a broken ecosystem for support that is frag mented by silos that make it difficult to get a single-point solution for all your technology support needs. We started the company with a vision to offer a one-stop engagement to consumers that is comprehensive with an incredible experience,” says Challu.

The Big Opportunity

Within three years of its inception, iYogi seems to be on a rapid upward swing, as evidenced by a customer base that is growing at 300 percent year-on-year. Most of iYogi’s growth stems from consumer business in the U.S., the UK, Australia and Canada. Currently targeting multiple geographies, the company sees a massive opportunity. There are currently more than 1.2 billion PCs in use worldwide and there is an increasing dependency on technologies we use everyday. “Additionally, the ecosystem for support is changing as traditional providers are no longer the preferred option,” says Challu. So, the same model is delivering growth country after country. “Our focus is on delivering a personalized service for the individual, and the approach is geography-agnostic,” he says.
For a company of its size, iYogi is quite aggressive in marketing. Its initial growth was focused on direct marketing on the Internet. The company has built a scalable model for acquiring customers online. It currently deploys one of the largest online marketing team in India, and over the past three years developed a deep understanding of consumer behavior. iYogi’s online marketing team manages large database of keywords, landing pages, toll-free-numbers, and builds content assets that assist in self-help and aid the decision making process for buying it’s subscription plan.

“We track about 300,000 keywords on online search engines and this database continues to expand based on consumer adoption of technology and user behavior”. The company has about 2,000 toll-free numbers and has decided against outsourcing its online marketing or opting for automatic online marketing tools. “The less you think you know, the better. Platforms get reinvented in this medium and one needs to continuously push the boundaries and innovate,” he says, adding the company can’t risk losing direct touch with the customers.

Apart from this, iYogi partners with companies that are at the frontlines of addressing technology adoption and related problems. With multiple engagements these channel partnership range from large OEM’s to ISV’s and retailers. iYogi services are complimentary to its partners that are enhancing lives through products that have integrated in our day-to-day lives. By offering on-demand assistance for setup, diagnostic, repair and usability, iYogi and its partners deliver on a common cause - to empower the consumer through technology, with a common tenant of delivering a quality experience. “Our current ramp-up plan, based on existing marketing channels, is to increase our base of customers by 15 percent every month,” says Uday.

What next? Apart from expanding its presence in 12 new geographies, including Europe and Middle East in the next eighteen months, India is where the company’s eye is. “We are now working on our go-to-market strategy for the India Sub-continent region. We will also be looking at partnering with ISPs and OEM’s to reach the end consumers,” says Challu.

India today is recognized as the best destination for enterprise outsourcing for technical support, as well as other processes. Large OEM’s and software vendors have built scalable processes for managing their technical support requirements. These processes are built with the imperative to deliver on customer expectations of vendor based tech support; while managing the costs, with eroding margins as technology becomes commoditized. Leveraging technology innovation and a low-cost, highly skilled workforce in India, iYogi is able to deliver on the most compelling technology services offering. iYogi is expanding its service offerings by commoditizing technology services across multiple technologies, price-points, languages and formats.

It plans to increase its staff size and handle new software platforms for mobile computing. iYogi hires the best tech experts that undergo an extensive learning and development program to deliver a great experience. The company boasts of a 95 percent customer satisfaction rate and a personalized service for its consumers. The scale-up will be a challenge because the demand is rising so rapidly that its own hiring can’t match that pace. So only half of its technicians are employed by it directly. The other half work at outsourcing partners such as IBM Daksh, Infinite, e4e, Ventura and Genpact but are deployed on iMantra platform. This helps the company reach top talent in multiple geographies and integrating them on its platform to deliver a seamless service.

iYogi has built a management team that has demonstrated cross border experience in managing large-scale processes, addressing big opportunities. “We invested in iYogi based on the management team that I can compare with the best in Silicon Valley and it’s a tremendous ratification to see them deliver on metrics quarter after quarter”, says Doug Higgins, Partner, SAP Ventures. “I am confident that this company is on its way to create India’s next success story,” he adds.

In May 2009, when iYogi acquired the U.S. based PC Clean Machine, a PC concierge company, the founder of the company Larry Gordon joined iYogi. He said, “iYogi and PC Clean shared a common approach of utilizing highly skilled talent with leading edge tools, thereby delivering services to a global audience that has new levels of expectations. It made strategic sense to come together and align with this common goal." With more than 20 years of experience, Larry has played a variety of strategic roles in marketing, sales and building global alliances at Capgemini, Kanbay and Cognizant. As the President of Global Channel Sales for iYogi, Larry is focused on developing a partner network that is addressing the customer pain-point.

Now, former Rediff.com CFO Joy Basu has also joined iYogi. Commenting on why he joined, Joy said, “I got hooked on the ambitious plans iYogi has for ramping its business, leveraging on its strong growth and multi-geography expansion.”

With the blazing trail that iYogi is leaving, it is no wonder that the company has been quickly and successfully able to raise about $27 million in three rounds of funding by venture capital firms such as Canaan Partners, SAP Ventures, SVB Financial Group and Draper Fisher Jurvetson. It is also getting feelers from software and hardware manufacturers for tech support through the classical outsourcing model. So what makes the investors bet on iYogi’s unconventional approach to outsourcing? “The ability to disrupt the market, most of which has a local base,” says Alok Mittal, Managing Director, Canaan Partners. “They have a clear picture of what they want to do; the CEO thinks big and wants to create a global tech support brand from India. One of the key inflexion points for iYogi is reaching more verticals. That will determine where it lands three years from now.”

Vendor Independent third-party technical support is a new service category, with Best Buy’s Geek Squad emerging as the largest player with an estimated revenue that is more than $1.2 billion. iYogi estimates the market for tech support services exceeds $30 billion today with remote technical support as its fastest growing channel for support.

According to projections by the NPD group, a consumer and retail market research firm, the market for support services ranging from installation, break-fix and repair, usability assistance and security services is worth $26 billion in the U.S. alone. As new technologies and gadgets arrive, iYogi’s target customers will only need more support. But Challu and Dhar are confident that as the opportunities continue to rise, they will be ready to take the bull by its horns.

As consumer electronics and computer systems become more pervasive in our lives and increasingly complex to use, many consumers are faced with challenges while installing, operating, maintaining, and repairing products within these categories. The market for information technology support services targeting the consumer and at home is highly fragmented, and, the traditional providers of support services, OEMs, VARs, System Integrators, and Retailers have all been forced to cut down on their support capability or have completely gone away, as the result of diminishing margins brought about by the commoditization of the PC and other related devices. As such, consumers have been forced to look for alternatives to traditional providers of support services.
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