Zantrik Co-Founder and CEO, Al-Farooque Shubho, reflects on his entrepreneurial journey, talks about how Zantrik came into being, explains Zantrik’s evolution to what it is today, how Zantrik is building a new kind of vehicle maintenance company in Dhaka, how it has grown to what it is today, Zantrik’s ambition, and shares lessons he has learned from his journey so far.
Future Startup
What is your background? How did you end up being an entrepreneur? Could you please tell us about your journey to what you are doing today?
Al-Farooque Shubho
I studied Computer Science at the Asian University of Bangladesh. After graduation, I started my career as a teacher at the same university. I had good grades, so it was an easy decision. After two years of teaching, I was looking for a change and decided to pursue a career in the software industry.
It was a good time, back in 2005, for software developers. I joined the Bangladesh offshore office of a Danish company where I worked for three and a half years. Then I worked for another company that used to work for US clients before joining Brain Station 23.
Back in 2011, I was working at Brainstation 23 in their British Telecom team as their architect. That’s when I first thought about pursuing entrepreneurship as a career. Eventually, I left Brainstation 23, that same year, to form my own team and start a business, which eventually became Smart Aspects where we serve clients from the USA and Australia.
Fast forward to 2016. I had a terrible experience with my car while it broke down in the middle of the road on my way to a meeting. There was scorching heat outside. I used to drive the car myself but I didn't have much knowledge about how it worked. There was no repair shop nearby. I called up my technician but he was also unavailable at that moment. I had to wait there for hours before getting help. After that incident, something dawned on me. Humans are planning to go to Mars, but, in Dhaka, you are helpless if your car broke down in the middle of the road! it seemed to me that it was not a problem for me alone.
That’s when I first thought about Zantrik. Since I'm a software engineer, I thought what if we design something to help people who face similar challenges. So we started developing a software which would allow people to get emergency help if their car broke down in the middle of a trip. That's how we started.
Future Startup
Did you leave your responsibilities at Smart Aspects by then?
Al-Farooque Shubho
I left Brain Station 23 when I decided to start Smart Aspects. But I still work with my team at Smart Aspects. Currently, seven people work there.
Future Startup
Could you tell us more about the time when you left Brainstation 23 and started your own company?
Al-Farooque Shubho
I learned a lot from my time at Brain Station, especially from Raisul Kabir - the founder of Brain Station 23. He is a simple, down-to-earth guy. I had the opportunity to work closely with him. You could say that his journey inspired me to pursue entrepreneurship. I had this realization that I could do something good for the society. Why don't I help bring more foreign currency, if I could? Why don't I create employment for others, if I could? That was a key motivation for me to start on my own.
I didn't need any substantial investment to start the initial operation. I had contacts with a few foreign clients who I came to know through my previous freelance projects. The bidding went well and I was lucky to get the job from. We quickly formed a team and started working. The clients were quite satisfied with our work, which helped us to continue working.
I decided not to grow too fast and too much. I figured early on that scaling a service business would be tough. We would have to put a lot of effort. If I have, say, only five clients, even then it's not easy to meet all of their expectations. So, instead, we decided to stick to a small number of clients and serve them well instead of trying to grow by adding more clients. I also thought of trying a product business that would offer better growth opportunity.
Then, in 2016 I experienced the incident that I explained earlier, which eventually led to the starting of Zantrik.
Future Startup
I’m assuming, Smart Aspects became a successful company by that time?
Al-Farooque Shubho
Well, I wouldn't call it successful. Success can mean many things to many people. But yes, it was profitable from the beginning. I didn't have to invest a single dime in it. I just hired a team and pay them on a project basis.
It was helpful to have a venture that was already generating revenue. It gave me the flexibility to think beyond money. When I started working on the Zantrik, I did not have to worry about salary.
I began working on the initial idea of Zantrik from 2016 - as I said, it was more of an emergency solution. My team didn't join me initially. When the system was almost ready, I brought a partner. He has a software background and has also worked in the telecom sector, both in the country and abroad, and is great at management and business.
Future Startup
Why would you bring a partner since you already had resources to start the company?
Al-Farooque Shubho
See, I'm a technical person after all. But I have a company to build and a team to manage. I didn't have enough time to devote to an organization that was still in its early stage. I had to find someone who has the experience and expertise and could fulfill this gap.
Future Startup
That’s a great way of thinking about it. So now you have a co-founder and you have already started working on a prototype. What did you do next?
Al-Farooque Shubho
We started working on our backend in early 2017. We decided to build a scalable model. We decided not to own any workshop. Instead, we would partner up with third-party workshops who would fix cars on behalf of us.
We finally launched the first version of our product at the beginning of 2018. We started with our roadside help product, which was more of emergency services. Eventually, we have expanded and today we are providing services like repair services and insurance. Our goal is to build a one-stop solution for your all vehicle maintenance need.
Over the past months, we have learned a tremendous amount about our users. While we started as an emergency service, we soon realized that it was not the right service for most of our potential customers. Moreover, the emergency situation doesn't occur all the time, which means if we pursue only emergency businesses, it would limit our growth opportunity.
We conducted a survey in Dhaka and found out that almost 75% of car owners don't believe the mechanics they go to for servicing their vehicle. They think that the workshops overcharge them and the quality of the repair is not good enough. We also found out that about the same percentage of people don't have enough time to get their cars to a workshop for regular maintenance. But every vehicle needs to be maintained. If you own a car, you need to change the engine oil, the filters, and so on.
When we found out that emergency repair services won't cut the deal for us, we decided to cover all of these issues, which would eventually lead to a subscription model. We had to come up with something that would allow us to build a sustainable business. We wanted to shape our offering in such a way that we could build a profitable business right off the bat, while, at the same time, offering our customers quality services at an affordable cost.
The result is our subscription model that provides a round-the-year maintenance service to our members at a great price. We provide them at half the prevailing market rate and that too with a good margin for us. It has been possible because we work with a number of value-chain partners who have agreed to provide their respective services at a better price since we consistently provide them with good volume works. The subscription model has created a win-win situation for us, our partners, and our customers.
We added some extra benefits to that. If you become our member today, you get first four servicing and four car washes for free. You get engine oil and filters that have a guaranteed quality. And, all of these you get at a competitive price. You can call our service from anywhere. We can fix your troubles either over the phone or our partner workshops can send mechanics to your location within 30 minutes. So far, we have 1,600 partner-workshops all over the country. We can serve you even in Teknaf, Tetulia or Sajek Valley.
Our motto has been to make the lives of vehicle owners easier. We have added insurance service to make the process of availing insurance easier for our users. Since it's mandatory to insure every automobile, we have made the process a lot easier by bringing it online. You can get this service now just by clicking a few buttons. We aren't charging anything extra for insurance service other than the government or insurance company charges.
We are also gradually exploring B2B market where we see a huge growth opportunity. We are in talks with a big ride-hailing company to launch a special package for their drivers. Then, there are other companies where a large number of employees have vehicles of their own. We are going to offer specialized and exclusive packages to them. Rent-a-car companies can also benefit from our service. Some of their cars run thousands of miles every day.
The opportunity in this space is huge and we are just getting started.
Future Startup
Could you give us an overview of Zantrik?
Al-Farooque Shubho
We have launched our service only eight months ago. We are a team of 23 people. Uddom, a startup that provides offline marketing solutions, has been working with us and helping us with offline marketing, promotional activities and direct sales.
We have over 5,000 customers and of them over 1,000 are members subscribers. The response has been very encouraging for us. The growth has been consistent and we are breaking our records every day.
Before us, nobody has really tried to work in this field. But there has always been a need for such a service. Vehicle-owners, you'll see that most of them, don't find the existing repair shops satisfactory. There was no price or quality standard. We are building that structure.
Future Startup
What other things went into building the initial operation?
Al-Farooque Shubho
One important thing that we needed, in the beginning, was funding. It's not easy to build something, particularly in the service industry, without investment. But I had some advantages in this regard. Since I am a software engineer myself and have a team, I didn't have to spend any money building the first version of the product. I had some personal savings that I put into the business. So initially, it was basically my skills, some internal investment and a lot of hard work.
We have closed our first external investment from a leading local venture capital firm. This is our first round of external investment.
Future Startup
How does your app and business process work? How do you connect users and service providers?
Al-Farooque Shubho
It's pretty simple. If your car breaks down in the middle of the road, you open up our app and call for service. We have the geographical locations of our partner-workshops in our system. When you send a request, we can identify your position and connect you with the nearest workshop. The workshops then receive the 'service required' notification automatically and arrange a mechanic to serve you. We also manually call them up to confirm that they actually heed the request.
Besides, we have our in-house automobile engineering team, a 3 member team, who can guide you through the process over the phone, if possible. Many times, there are problems that could be solved over the phone consultation, that’s what our engineers try to do.
Future Startup
This is interesting. We have been talking to a number of companies who work in the service industry and we routinely ask them why they don't work in automobile servicing space since this is such a huge market.
Al-Farooque Shubho
Absolutely. The lubricant market in Dhaka is worth around four to five thousand crores per year whereas insurance is a 500-crore market and servicing is around 10 thousand crore per year.
All of these sectors are growing rapidly. The number of people using motorcycles is growing by 35% yearly and it'd reach one crore threshold within the next 5 years.
Apparently, there is a huge need for organized service in this industry.
We have so far served more than five thousand customers. We are getting responses from potential and existing customers every few minutes. Launching the insurance service has worked like magic for us. We have over 1,600 partner-workshops at present. Our app sees about 8,000 downloads so far and it is growing rapidly.
Future Startup
Having said that, how do you ensure a great service because this is such a difficult market and you work with third-party providers where your control is limited?
Al-Farooque Shubho
This is an important question. There were and are a number of challenges before us. The service industry has been this way for a long time and the participants in this industry, service-people, have become accustomed to this unstructured practices. It has been a challenge to motivate people to treat customers differently.
We knew this would happen. And that it would be difficult to ensure great customer experience. So instead of trying to do the impossible, initially, what we did was identifying areas where it is difficult to make customers unhappy. Take, for example, insurance where you just place a service order and we process it for you. It's pretty simple and has little room for dissatisfaction. As a result, by doing business in this sub-sector, we are trying to build a good relationship with our customers from the beginning.
Another such sector is maintenance. Car or motorcycle owners need to change the engine oil and filters every three months. They spend on an average 10 to 12 thousand taka for this purpose. We provide them better service at a competitive pricing.
This has really worked. Almost 95% of our customers are satisfied with our service. And now, they are asking us to expand into more complex areas. Although we don't want to move into new segments right now, it's really encouraging to see our customers demanding for more. This is basically our secret recipe for success.
Future Startup
What are the biggest challenges you have faced?
Al-Farooque Shubho
Since we are the first of its kind in this industry, initially, our biggest challenge was to make our customers understand our service. We have stories of pretty funny experiences. Initially, many people thought us something similar to ride-hailing companies. That was a major challenge - basically communication challenge. We had to work hard to change the perception of our customers.
We started without external funding. Now, this is an internet based business and you need to make an upfront investment in building the product and in marketing. Since we did not raise any investment and self-funding the company, we had to optimize in every step of the process. I was doing the work of four persons every day. That has been a huge challenge.
Apart from that, I don't think Bangladesh is still ready for digital services. Yes, the market is shaping up fast and Uber is a good addition to this sector. When they began operating, people started to use mobile apps and so on. Now, when we approach people saying that our app will make your life easier and better, people now take it positively. Things like this are changing of course, but we are still not yet there.
Payment remains a challenge. People can pay us via credit cards, Bkash, and other payment systems. But this remains a struggle for us. For example, we had a huge growth in our sales recently. Around 700 people registered for our membership service last month. But when we reached out to them for confirmation many of them declined. Some wanted to defer the payment and many we couldn't reach over the phone.
It made us realize that payment is a big problem. If people were used to paying digitally, they would have just made the payment online and get the service. But this is not happening right now. And it is affecting our growth.
Future Startup
What percentage of your payment is made digitally? Are you doing anything in particular to promote it?
Al-Farooque Shubho
About 10%. We are trying to encourage people to pay digitally by offering discounts on digital payments. But changing habits is hard. So it'll take time. We believe that in the next few years, things will change for the better.
Future Startup
How are you doing in terms of business?
Al-Farooque Shubho
We have so far served more than five thousand customers. We are getting responses from potential and existing customers every few minutes. Launching the insurance service has worked like magic for us.
We have over 1,600 partner-workshops at present. Our app sees about 8,000 downloads so far and it is growing rapidly. We have generated sales worth BDT 4 Million.
Our target is to grow by 25% every month. So far we have been successful in meeting our goal. Having said that, there is a huge room for growth and we have plans to further push the growth but still, these numbers are not that high given that we are an early-stage company.
One challenge related to growth for us is that people are signing up but when it comes to real conversion, that is not happening as much as expected. Payment remains a challenge, which also contributes to the insignificant conversion, as well as people are not used to the have the similar service that we provide, that’s a problem as well.
Be original. Don’t merely imitate others. Come up with your own ideas, test it and then learn from it. Develop your own opinion and confirm it by testing it against others.
Future Startup
I think you are in a very interesting segment. When you are doing one thing, communication is straightforward: we deal with cars. If you have any problem with your car, come to Zantrik. Then people have your app and they register with you as members and enjoy your service, which, in turn, should enable you to expand your service over the time into other related territories.
Al-Farooque Shubho
Yeah, you're right. Soon we are going to launch a new version of our app. The previous app was pretty basic as we wanted people to get comfortable with it first. The new app will be more feature-rich. We plan to release a new version of our app in the next few months.
Future Startup
Besides the new app, what are your plans for the next couple of years?
Al-Farooque Shubho
In 2019, we plan to expand our service country-wide. There are a few markets outside Bangladesh that interest us where we see great potentials that we plan to explore in the next couple of years.
For now, building our internal capability so that we can serve our customers better, improving our platform, building a better relationship with our service partners and more importantly growing consistently are some of the areas we plan to focus.
Future Startup
What are some lessons you have learned so far?
Al-Farooque Shubho
Well, at Smart Aspects we do offshore software development. It's easy to make such a venture profitable because customers pay in the dollar and usually on an hourly basis. These businesses are usually profitable from the very beginning. But you can't scale them easily.
On the opposite side, product-based businesses are scalable in nature. You can help millions of people through your service. And it's not only about making money, but also about helping people. My primary inspiration for building this company was to make life easier for people. Just a few weeks ago, we got a request from a person whose car broke down at 1 am in the morning and we were able to help him. He was very happy with our service. That's where our inspiration comes from. People come first, business comes next.
Then there's another thing which I personally feel for a lot. Whenever I go to workshops I see a lot of underage kids working there. These children lack even the basic rights. They don't get enough food, appropriate education, proper shelter, and basic healthcare facilities. So, we have taken up a policy at Zantrik under which we will try to provide basic medical facilities and education for these children so that they can at least get a chance to improve their lives. We are going to start implementing it as soon as we are profitable.
I try to learn every day. A few months ago, we participated in a tech conference called TechSauch that took place in Bangkok, Thailand. There was this one participant from Japan, a little girl. She showed us a picture where three-four people were working on a table without a light in the room. Their faces were glowing from the laptop screen. The girl told us that the picture was of their team and that a few years ago they didn't have enough money to rent a bigger room or even pay for electricity. But they soon grew to be a billion-dollar company. It was a huge inspiration to me. People all around the world are building amazing things. We are fortunate that this is a golden age for makers. At Zantrik, we want to build a company of consequence.
Embrace failure. I had started something before and failed. But I don’t regret that. Now that I look back, I understand that that failure taught me a great deal. It changed my perspective towards life and work. If I become an investor someday, I won't invest in someone who hasn't failed at least once in his or her life. So don’t be afraid of failure. As long as you don’t give up, failure is the best teacher.
Future Startup
What does it take to build a successful company?
Al-Farooque Shubho
I believe that anyone can be an entrepreneur. What's important is that you have to believe in yourself. If you don't believe that you can do something, you will fail no matter what. You have to believe in yourself. The upside of faith is that you commit and do your best and when you commit and do your best, good things happen.
An entrepreneurial journey, or any journey for that matter, is full of ups and downs. You got to be ready for that. My father used to say that, try for the best and prepare for the worst. In other words, you need to have Plan A, Plan B, and Plan C for everything you do. I have followed this lesson all my life. If I plan to do anything, I always have a plan B.
Future Startup
Where can our readers go to know more about Zantrik?
Al-Farooque Shubho
You can to our website http://zantrik.com and our social media page where we post updates on a daily basis to learn more about us and take our service.
Future Startup
What advice would you give to people who are just starting out?
Al-Farooque Shubho
Before jumping into anything, you should gather some experiences first. My own life taught me that there is no teacher like experience. When you work for a company, be it small or big, you learn about process and systems and organizational structure, which eventually help you in your own business. Start with a basic job, better if it allows you to be in direct touch with customers. It'll help you to mix with a lot of people and talk to them, which will play an important role in shaping up your career in the future.
Embrace failure. I had started something before and failed. But I don’t regret that. Now that I look back, I understand that that failure taught me a great deal. It changed my perspective towards life and work. If I become an investor someday, I won't invest in someone who hasn't failed at least once in his or her life. So don’t be afraid of failure. As long as you don’t give up, failure is the best teacher.
Be original. Don’t merely imitate others. Come up with your own ideas, test it and then learn from it. Develop your own opinion and confirm it by testing it against others.
Meet a lot of people. People are the catalyst for change. People bring opportunities and luck.
Interview by Ruhul Kader, Transcription by Rahatil Ashekan | Photo by Zantrik
