The growing number of internet-friendly users and marginal investments are attracting IIT-IIM graduates to enter the business
“I pressed the end button by mistake and my test ended! Does this mean my one year’s preparation for CAT went for a toss? Please help me!” went a desperate plea of a candidate on the forum of an MBA resource website. Within minutes, she got a dozen replies from those who faced the same problem and others who assured that she would get a chance to re-appear.
This candidate is among thousands of young people who are increasingly joining MBA resource websites to connect with peers and get regular updates to the academic programmes and careers they are interested in. On their part, the websites have seen the opportunities that lie in tapping the growing market of internet-friendly users and are making plans to expand their product offerings.
Take for instance, PaGaLGuY.com, a website started by Allwyn Agnel, a young MBA aspirant in 2002. Agnel started the website to fulfill his need to interact with like-minded people on academics. Today, the website has close to 360,000 registered users and over 500,000 unique visitors per month. From being a forum-centric website, PaGaLGuY has now diversified to various features like B-school ranking, PaGaLGuY Apply — which is a single-point application system to apply to over 70 Indian B-schools, an on-line store for B-school forms, test preparation material, SMS alerts, test paper prep and e-books. With the popularity of its brand, the website has also started selling its own merchandise like t-shirts.
Apurv Pandit, chief editor of PaGaLGuY says the website functions on a simple revenue model. “We have an advertisement-driven revenue model. Our main advertisers are B-schools and IT companies who are regulars on our website. We offer options like banners, newsletters, direct mail advertorials, quizzes and contests.” Some B-schools sell their entrance forms through the website. PaGaLGuY cites SP Jain Dubai, XLRI Singapore, IMS Learning Resources, Career Launcher, Symbiosis, Apple and Hewlett Packard as its clients.
For those starting MBA focused websites, the most attractive factor is that very little investment is required initially. Satwinder Singh Saimbi, co-founder, MBAUniverse.com says his portal was set up with an initial investment of Rs 2 crore. The website includes news, views and developments from campuses across India and abroad.
MBAUniverse has a registered base of 400,000 subscribers. Some of these are registered for free while others are paid. The website generates its revenues offline as well. It comes out with a bi-annual book for MBA aspirants and organises educational seminars, fairs and facilitates form sales for B-schools.
“Under the new development of computer-based testing for the test prep domain, MBAUniverse.com will introduce some interesting concepts for the test prep companies and the MBA aspirants,” said Saimbi.
Since most of these websites function on self-generating revenues, there is care to see that the brand is marketed through various social tools which are available either for zero or very low cost. MBAUniverse, for instance, markets itself through promotions on the internet and tie-ups and alliances with leading media companies to promote joint initiatives. The website has had associations with leading institutes like IIMs, IITs, XLRI, FMS, IIFT, and institutions like CII, FICCI, AIMA, ATMA, TiE.
Initially started as a forum to interact with peers, some of these websites have gone on to branch into test preparation, which has grown very fast, due to increasing number of students vying for a seat at the Indian Institutes of Management (IIMs). According to latest estimates, the test prep industry for MBA, medical and engineering is nearly Rs 7,500 crore of which a significant part is contributed by the preparation for MBA entrance exams like CAT, FMS, XAT, JMET, NMAT, MAT among others.
TestFunda.com, started in July 2008, is one among few websites whose core business model is focused on helping aspirants prepare for entrance tests like CAT, XAT, FMS, SNAP, among others. The website has over 130,000 registered users and has tie ups with various coaching institutes to provide its study material to students.
To retain students, the website creates personalised study guides to revise weak topics, creates personalised post assessment tests to strengthen concepts and organises videos and contact seminars that provide guidance on how to face the group discussion and personal interview stage.
“Education has been a high growth area for a while now. More importantly, we firmly believe that internet will have an increasing impact on how education is delivered and on how people learn. The online medium provides great opportunity for interactivity, immediate feedback, and user-guided contextual learning,” said a spokesperson for TestFunda.
Typically, these websites are headed by holders of management degrees from reputed institutes who are able to empathise better with the needs of the MBA student community. Allwyn Agnel of PaGaLGuy is an MBA from Wharton, while TestFunda has a management team of five IIT-IIM graduates.
Most of these websites are in the process of expanding their portfolio and expect internal accruals to be sufficient for their financial needs at present. However, at a later stage, they do not rule out private equity or angel funding. “We have been in talks with Vice Chairman’s for quite sometime now but to attract funding on needs to reach a certain level to justify the business model. We are in the process of doing that,” says Pandit.
