Within this calendar year, we might hit $200 million revenue run rate: Deepinder Goyal, Zomato

Pankaj Mishra June 7, 2018 23 min

Far away from the epic ecommerce battle between Flipkart (to be owned by Walmart) and Amazon, Deepinder Goyal has been building Zomato, the restaurant listings and food ordering company. Recently, the company crossed a revenues run rate of $100 million. The milestone also coincided with the exit of Pankaj Chaddah, co-founder at Zomato, from the company.

FactorDaily’s Pankaj Mishra sat down with Goyal in April to capture learnings from Zomato’s decade of existence, the company’s culture, what went into achieving the $100 million annual revenue run rate, saying goodbye to Chaddah from the company, and personal life hacks. Edited excerpts from the interview:

Q: Is there more to Zomato than what appears on the surface?
A: I think that most of the journey, we have been transparent any which way – both through ups and downs. So, you want to understand what is under the skin, what is under the surface… I don’t think there is much. Whatever is there, it is (out) there.
And, look at our colour palette. The logo changes but the brand manual remains the same. There are three primary colours – Red, which basically symbolises our passion for food. And, then, black and white, which stand for transparency
That transparency comes at a cost… of things leaking to the press – left, right and centre. So for us, it is always a choice: whether you keep your own people in the dark to save us from (leaks to the press). There are pros and cons; there is no right answer.
We have always chosen that I will tell everybody everything. And if it leaks, so be it. It is fine.

Q: You find it better to deal with this than not telling?
A: You can shut yourself off to external noise, you can’t shut yourself off to internal noise. ‘You did not tell me this’, ‘Why did you not tell me this’, ‘Do you not trust me’… I don’t want to hear that at Zomato.

Q: Between the first million dollars earned and this $100 million dollar earned, of course, a lot would have changed. But if you were to pick only a few things that have really changed, what would those be? And, I am not necessarily talking about scale…
A: All these realisations are an outcome of scale. We have a multi, multi, multi-country business. We have multiple product lines. The complexity is quite decent on the top; it is not straightforward.
I think we have become much better than two years ago – in terms of having the right people on the ground and a lot of senior people having ownership towards what they need to do. They think of themselves as founders.
But, the biggest difference between now and then is that I can’t move to many things at the same time; in terms of the percentage of the things. I have to pick my battles, I have to prioritise really, really well rather than saying, “I will get into everything”.

Q: You make an important point here – because when you are small, people try and change too many things too often…
A: At that point of time, even the littlest things, you don’t need any process or guideline call. For example: if there happens to be an increase in an employee’s salary, you can approve everything. It takes like one hour to approve everything that happens in the organization. You always have a clear picture of what is going in, like, everyone’s life.
Now, you don’t have that picture. Now, you have to rely on systems and data, a lot more than your own gut. Right? For most founders, finding that balance between gut and data, right, I think, that is a hard, hard challenge.

Q: That is unlearning also for you as a person. What has changed in you as a person?
A: I have started saying ‘I don’t know’ a lot more times than back then. And I mean, in spite of everything that I have learnt, I am saying ‘I don’t know’ more than what I used to do six, seven, ten years ago.

Q: And the kind of people you would hire or you would have hired earlier compared to now? It is also a function of scale and complexity or are they two different areas…
A: I have always, at least at the senior level, always aimed to hire the best but I think my definition of what that really means has changed over time.

Q: Okay, how is that? Help me understand that at least in the terms of talent point of view, the skill point of view.
A: I think there is ‘no one size that fits all’. There is so no such thing that this person has done so well in their life, so that person will do well here. That thing just doesn’t work. There is no correlation between the two.
For specific roles, specific personality types work: like left brain and right brain. There are some businesses – (Zomato) Gold, for example – is a very, very right brain business. Right is where you have more ideas and EQ (emotional quotient). You ask and say: ‘Is this the way it is supposed to be?’ ‘Am I saying the right thing?’ ‘Correct. Please make this correct.’
Food ordering is very, very left brain; in the sense that there are operations, maths, data… meaning, one must continue to be focused. It does not need that many ideas, it needs execution: left, right and centre.
So, it is not like that if you have hired a business head for Gold, you can easily switch that person to ordering. No. These are personality types: that person works here and that person works here.
And, over time, sometimes, the shape and form of the business changes as well, then what happens to that person. I think those are the harder problems.
I think what I have learnt is in terms of hiring is either you tailor the role for the person or you tailor the person for the role or you find the right person for the role, essentially.

Q: That sounds very ideal…
A: So, four years ago, I used to think that a person is smart and he will be able to do it. Basically, he is a smart person, he has done so well in life. How hard can this be? He is smart to figure this out.
But, no. People are built in a certain way, they are wired in a certain way, and you have to play to their strengths and not think that they can basically overcome any weakness or any weak point in their personality type just because they are smart.

Q: As a founder, can the same thing be applied to you?
A: Given a choice, I would like to do X and not like to do Y. But, as a founder, you are only trying to optimise for the outcome and you don’t mind the work. It is like everything that you have to do but you don’t want to do specific work. Still, to get to an outcome, you have to do the work. There is no choice. And the more you think about why am I doing this, it will lead to a burnout and that is not a good place to be in. So, you just don’t think, you just get the job done.

Q: In this ten-year journey, were there moments of burnout or whatever, like, loss for you personally ever?
A: I think I burn myself out very fast, intentionally. I don’t work at 80% in general, in life. I work at 120% and every month or month and a half, it would burn me out. Then, I will completely switch off for two days and then I am back in the zone and then I go again, go at it again for 45 days. That is my cycle. I think 80% is not optimal.
While I am working, like every day and on and on, I don’t understand the concept of this ‘work-life balance’. I feel, that either I can work or can live life or do an alternative between the two. But this balance shit does not work for me.

Q: When you take a break, it is ‘the life’ part, as we call it, right?
A: I mean spend time with family… spend time on yourself. But, the idea is to not to take a break. The idea is to get rid of the burnout and get back into the zone because that is really what you are solving.

Q: How is Pankaj (Chaddah, Zomato’s co-founder who quit in March)? When a co-founder leaves, how does it stand as an experience?
A: I think the best way to describe that experience is that it still hasn’t sunk in yet. Life is too busy right now to even reflect on it and let it sink in and I think maybe… what you feel makes you do that. I don’t know! Makes you, makes your life so busy because you don’t want to think about it. I don’t know what my mind is playing with me right now.

Q: It took ten years for a $100 million revenue run rate and become a unicorn. Lot of people look for science in these things, like, if there has to be a startup in India, it will take ten years and they think they can create a template. As someone who has been through this journey, do you think there is a template, a playbook in this?
A: I think playbooks are possible but the ifs and buts are so elaborate that how will you replicate the same? It is so hard for anybody to describe those things that is why most of these business books are useless. Language, words, are basically, a tool to describe my thoughts. Right? If you could get into my thoughts, you would actually get what I am saying. I suck at words. Everybody sucks at words. Thoughts are natural to us, words are not.
I think there is so much meaning and depth in all of those guys who are writing these big books for business but 99% of the people don’t even get what they are trying to say. How many people would have read the book ‘How to become a Millionaire’? A genuine question. It has sold 10 million copies or something. But did each one of them become a millionaire? Not even like 0.1% of them, I am sure. So, it is a translation issue (of thoughts) rather than possible or not possible kind of issue.

Q: But ordinarily, if you were to look at building a consumer internet company in India, which can do 100 million (dollars in revenue), which can do these things you told me… are there dos and don’ts if you were to generalise?
A: Yes, there are very basic do’s and don’ts but, I mean, we have all heard them 2,000 times in our life. It means the trick is having the discipline to follow through on them. It means to care for your customer – who does it? What does that word ‘care’ even mean? It means different things to you and me. I think that is where the nuances become different so these manuals are useless.

Q: How old are you?
A: I am 35. White hair has appeared.

Q: I also asked that question because one more thing that people talk about is the runway of the founders. How do you look at your journey with Zomato?
A: I am a very different person. I don’t remember too many details of my past, deliberately. I remember the outcomes, I remember the learnings, process and all that. Someone was writing an article on Pankaj (Chaddah) and asked what did Pankaj say during the exit conversation, what did you say, what did he say and so forth.
I was like I have no memory of all of that. I just remember how I felt after that conversation and what did we finally conclude on. That is what matters. So, and he was like but how does that work? And I said, how else does it work? Why should I remember the details? I have a limited amount of brain capacity, as well. So, what I am trying to say is that I don’t think it has been 10 years, I don’t feel it has been 10, I only feel like how the last couple of weeks have gone by. So, my physical and mental states depend on my last two weeks and it will not depend on my last 20 or 30 or 40.

Q: I think that is an important thing you have answered.
A: Or maybe I have long-term memory loss. For example, I don’t feel grudges with people. I have recency bias with regard to people… If we have had a fight, I would be sulking in front of you for two weeks but then I will be fine because I will get over it.

Q: But how much do you think about the future?
A: I think I am always only thinking about the future because we have a great team to take care of the now. I have to work on the now when I get called in – ‘Dude! I need you to problem solve this as we have to create alignment here; come, solve this.

Q: Normally what kind of problems do you get caught up in? I am asking this because it is also a function of – whether you were called for the kind of problems which were faced earlier or is it right now? Would that also change over a period of time?
A: I think it is more of prioritisation rather than anything else. When there are multiple team members – one person is saying ‘we have to do it like this or like that’ or not even that what needs to be done versus this needs to be done. What should be prioritised? It is just like, we need to align – this is important and that is not. And most of the times, people are able to align between themselves as well because it is a very clear mathematical answer that this creates more impact than that. But when there is no such data, then it comes on opinion. When two people fight over peers’ opinion versus their opinion then I have to do the arbitrage there, as there is no other option. And that is a very nicely done. It means, it is frictionless.


Q: How much do you think about competition?
A: So, the Yelp days are gone. Yelp also sort of stepped back into focusing on the US more. There are literally no battle lines drawn between Yelp and Zomato. It means, they stay on in their countries and we stay in ours. There is a China, there is a US, and there is the rest of the world. We have some of the rest of the world and the rest of the rest of the world with some with some other folks. And that’s it.
This, I am saying from our reviews and listings core presence business point of view. So, in that aspect of our life, we are very, very sorted. Growing so fast and only product. There is immense respect, trust and the network effect is huge.
Then, it comes down to the transaction’s side of these businesses. Food ordering and table reservations. Here, the intensity of competition from country to country goes up or down… even city to city it goes up and down. We don’t think about the competition that we have to beat them. We are more focused on that I have to be No. 1. It means obsession is about winning and we just obsess about competition to an extent that ‘what can we learn from these guys?’ Because if they have already cracked a problem, I am not going to spend time thinking, thinking about it. I am going to copy that and then I am going to innovate on top of that.
So, that is how we think about competition and, generally, the network effect of the business is large enough for us to compete and fight and stay so, I mean, the food ordering business is in three countries right now, growing so fast. Right now, our biggest problem at Zomato is how are you going to handle the growth? It is not about how to bring about more growth. It is about that I can grow about 20% week on week as well but your shit will break if you grow if, if you grow that much, so can you please throttle this for a while?

Q: Good problem to have.
A: Yes, but it is just like, puts the being No. 1 goal slightly further ahead, so that frustrates you… that we can get this done in 45 days, like this will all be over in 45 days. But this is taking longer.

Q: Would the next 100 million take the same time or ideally it should crunch, right?
A: The run rate is 100 million currently. No, means, right now, April revenue will be 9.5ish (million dollars). It will shoot up. No, 10 years, absolutely not, I think it will be like 12 months, at most more. Now, the revenue is vertically inclined, so, within this calendar year, we might hit 200 million. Might. I don’t know. Means, we are all trying hard to get there. Let’s see what happens!

Q: What is the outcome for you, Deepinder, as an entrepreneur? And I know I am asking this question despite knowing that you are not a serious kind of a guy, who over-obsesses about ‘that we are doing entrepreneurship’. But still what does outcome mean to you from a journey like this?
A: Yaar, I have never thought about it. Hmmm… Life should be happy, I should be busy, I should be working on something meaningful. That’s it. I think, the outcome for me is always having some kind of purpose and why do you wake up every day. That is outcome for me. I don’t want to wake up if there is no purpose to my day. That’s it.

Q: A lot of time, while investors have their horizons, like for funds, they say seven years, 10 years…., entrepreneurs also start behaving like investors in some way. How have you managed that, when you were scaling and doing things like this?
A: We are a very small group of investors – five people but everybody is big. Everybody is putting meaningful capital at Zomato, so everybody has a decent amount of say. And there is nothing to manage in the relationship. Everybody knows everything – it is smooth, it is nice, people know what we need to work on, people know what we are doing well and they know we are the best team to do this anyway. So, it means, there is no exit horizon. Four out of five people do not have an exit timeline. So, Info Edge doesn’t, Temasek doesn’t, Vy Capital doesn’t… Vy Capital is structured as a company like software – it is not structured as a fund. Ant Financials does not have a timeline.
Sequoia is the only (VC) company and Sequoia is very long-term and patient. It can just keep flipping funds and as much as I know how their structure works. Sequoia has never asked us that they need anything. Sequoia is extremely patient. It has been almost four years – never ever, had anything coming my way.
Even during bad times, good times, everyone demonstrates the same behaviour. Sometimes, I do feel weird but we do not show indifference. I think we were lucky to get the right folks on our side.

Q: Your view of the future when it comes to Zomato and what you can become or what you can do… how could it change if we sit again in three years, five years, and 10 years? I don’t know what horizon is when you normally think of future?
A: We think one, five, 10, we think 20 as well. And the hardest thing is balancing the short term and the long term. And that is the other thing that sort of comes down to me. I have to balance that. And I have to set goals and directions for the rest of the organisation as this has to be done and when is to be done; resource allocation – should we be starting to work 20 years from right now or not. If you start working on the 20 years right now, you are taking away resources from the now. And therefore you are reducing the probability of the now actually happening. And if the now does not happen, then the long term is never going to happen. So, this is balancing risk.
Finally, resources are time and money! So, and if you have good people, would you put more of them on a single business which needs to scale faster or would you distribute them over multiple businesses? All these calls are like hard to take and luckily, the intensity of that problem at Zomato is not that high. So I think the product is able to attract a lot of great people to work for us in spite of our reputation out there in the market as being a very tough place to work at. It is not meant for everyone. I am not making an ashram

Q: That position also helps, right? That you attract the right talent…
A: A lot of people who are weak, they don’t even walk into the door. It’s self-filtering, meaning, we have to actually interview fewer folks.

Q: What do you look for when you hire someone? Like, what would be one question… either one common question or a common thing you want to know.
A: I just try to make the person very, very uncomfortable, in general, when I am interviewing. I am very direct and candid in life, in general. I don’t know any hmm, any other way. And I make the person uncomfortable. If that person is comfortable being uncomfortable, I am good. The skills are generally checked by other folks until it gets to me.
People should be able to process tough situations with relative calm. And tough conversations, candid feedback conversations. Now, if you get defensive while taking feedback, that is a downward spiral. So, those things I test for that ‘Will this person survive the next week here or not’. Because, Zomato is very very candid, it is built to be that, no mincing words.


Q: On a more final note, tech, data science… things like that – what role do you see them playing and what is the biggest achievement at Zomato?
A: I think data sciences are starting to take an active driver’s seat inside Zomato right now – that the business is supposed to work in this way. However, the problem with data sciences is that it can potentially solve problems which are already out there or it can, or it can incrementally improve what is already there in the past. Not much innovation is possible in data sciences. Maybe they can throw up even more problem statements.
So, again, the same left-brain, right-brain concept appears again. You need a combination of both of these things to work and solve for a business problem. So, everybody, every kind of skill has a role in an organisation. And I think everybody, all the people, including you and me and everybody else, need to know what they are strong at and just only work at that. It means, if you start fixing your weaknesses, then it is going to take you five lifetimes to even get one, one odd per cent of that done. Then why are you doing it? Do what you know. That’s better.

Q: Things like artificial intelligence or machine learning…
A: Artificial intelligence is not something that we chase on its own. So, but we work on it to solve specific problems for Zomato in a very effort versus impact matrix fashion. So, if we have to solve a problem – there are six things which will add up to solving that problem. They get charted on an effort versus impact chart. The option with the lowest effort and highest impact goes up, out first. So, a bit of machine learning is used for our sales hiring process.
Sometimes, people start saying engineering organisation, to which I say, that it is not an engineering organisation, this is a team. There is only one organisation which is Zomato. If you start calling engineering as organisation, then your growth can diverge from Zomato. So finally, we are all here to build Zomato and not to build your own engineering goal.
Then, I am told ‘We will write this tech in the best possible way’. To which I said, what is the need for it? And people hate me for saying this, engineers especially. That is a conversation I keep having. This thing that you are trying to write right now, I don’t even know whether we will use it two weeks from now because this is a very stupid test that you are trying to do. Let’s test it out, let’s hack some stuff up, it might not scale even to a 100 users. If it works, we will re-write everything but let’s not spend three weeks writing this stuff well before we know even whether it is going to work or not.
I think the technology team at Zomato is actually really good. It finds the perfect balance between tech goals and business goals. We only aim to hire or look for those kind of people and the tech is also very good and solid and scaled very fast, right.
We are right now growing at 20% week on week. It is not easy for any tech system to be able to handle that kind of growth. But it is holding up so well. And of course there are problems to solve but the engineering team is very solid right now. But with the right business mindset as well.

Q: That lens is important.
A: That lens is important. I mean, engineering is a tool. You are finally solving business problems and our tech, our tech team understands this really well

Q: Final question: people say ‘too big to fail’ – when you have reached that kind of scale. Do you believe in ‘too big to fail’?
A: I don’t. I have seen so many failures in large companies. I’d be stupid to believe in any of that.

Q: In the last 10 years, have there been instances when you thought it was near death?
A: No. There is always a way out. One must not be problem focused. If you are solution focused, everything works out.


Updated at 01:28 pm on June 7, 2018  to correct the distinction between left-brained and right-brained characteristics. They were interchanged earlier. A few more typos were corrected after an initial set of corrections at 8.59 am.

Disclosure: FactorDaily is owned by SourceCode Media, which counts Accel Partners, Blume Ventures and Vijay Shekhar Sharma among its investors. Accel Partners is an early investor in Flipkart. Vijay Shekhar Sharma is the founder of Paytm. None of FactorDaily’s investors have any influence on its reporting about India’s technology and startup ecosystem.