A former dotcomer returns to his roots

What is a former PricewaterhouseCoopers (PwC) professional, who was advising multinationals on SAP implementation in Chicago, doing printing T-shirts in Hyderabad? Phani Raj, 34, director of eYantra Industries, has hit pay dirt doing just that.

eYantra is a corporate gifts company, a former dotcom called www.pratima.com that almost went belly up three years ago. "When we started in April 2000, the dotcom boom was on. At that time we were a web-based entity, offering only customised T-shirts to clients. There were no payment gateways and cash was paid on delivery."

The dotcom offered customers the ability to choose a T-shirt and its quality, design their own image and caption for it and finally order it. Apart from Phani, a couple of high net worth PwC individuals invested in the dotcom.

"In July 200, Ernst & Young valued us at about Rs 70 crore. We also had an offer of $11 million for an outright sale from another dotcom called iprint.com. And PwC wanted to buy us out for Rs 5 crore when we started out," Phani points out.

By late 2000, however, the dotcom meltdown had started and Phani was battling serious issues. "Customers were getting fussier about what they wanted and we were finding it difficult to cater to their demands. We had burned up close to Rs 1 crore and were losing money. We clearly needed to do business the traditional way and have more products to offer, rather than just T-shirts, mugs or clocks."

So the focus shifted to companies, rather than individual customers. Signalling its break from its dotcom past, Phani also changed his company's name from eyantra.com to eYantra Industries (eyantra.co-m was the holding company for www.pratima.com ). "Whi-le we did have corporates on our radar earlier, we were not quite focused on them," Phani points out.

His Rs 7 crore company today offers corporate customers over 5,000 products that they can buy and gift, including pens, watches, lighters, photo frames, steel flasks, mugs, candles, toys, T-shirts, shirts, fleece jackets, bags, sweat shirts, umbrellas, acrylic mementoes, plastic goods, jute products, leather goods, hand made paper, golf equipment, wood products, electronic items and even stationery items.

"Our first corporate sale was to Tata Consultancy Services in Hyderabad. We sold five T-shirts to it. After this we got a huge order from Coke for T-shirts, caps and clocks. We made a profit of Rs 40,000 on this and then I knew that this was the way to grow," he says.

His company now has over 1,000 corporate clients in India like Mercedes Benz, Microsoft, Oracle, General Motors, Motorola, Hindustan Lever, General Electric, LG, Coca Cola, Pepsi, Reliance, Infosys, and Wipro.

Rishi Khanna, partner at the Mumbai-based Prompt Marketing which competes with Phani's company, says ruefully: "Its biggest strength is its pan-India presence and its sourcing. Those guys are able to source the best quality goods at unbelievable prices from across the country and outside." Khanna's 10-year-old, Rs 1 crore company has 60-odd clients. "eYantra has its own T-shirt manufacturing units and this gives it an edge," Khanna adds.

That view is echoed by Saba Zahir, 28, proprietor of the Rs 1 crore Gifts and Promotion Solutions, another competitor: "eYantra is giving us competition in Mumbai. Its strength seems to be its strong backend."

Strikingly, Phani is now going back to the web. He'll call the website www.eyantra.net and the site will offer over 1,000 customisable products to customers. "We have achieved economies of scale. Now we can offer all of that through the internet at unbeatable prices," he points out. www.eyantra.n-et is slated to take off in September this year.

Having set himself a 2006 turnover target of close to Rs 25 crore, Phani is also considering launching a chain of retail stores nationwide. "There is no point in not leveraging our sourcing success and giving consumers quality products at prices which are lower by a factor of at least four," he points out. He's now initiating talks with venture capitalists to raise money to fund his chain.