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Booked for growth
June 26, 2004
Rakesh Gupta founded TechBooks in 1988 with his brother Neal and sister Anita.
Initially, it was a publishing firm specialising in reprints of science and technology books but soon Gupta identified a more tantalising business opportunity. As an Indian based in the US, he knew India was home to a large technical workforce that was English-speaking.
He tapped into that workforce in 1992 to re-invent TechBooks as a provider of high-quality, cost-effective electronic content solutions to book and journal publishers in the US. A business that was set up by pooling the family's credit cards, TechBooks now has a turnover of $46 million.
My father went to the US in 1949 to study and ended up staying there. He trained as a ceramic engineer and worked in the R&D departments of several ceramic manufacturing businesses.
He also had a part-time business as a mail-order bookseller. I was born in 1962 in Taunton, Massachusetts, and grew up mainly in a small town in Ohio.
My parents regularly sent my brother Neal, my sister Anita and me to India for our summer vacations to keep us in touch with our heritage. This created a comfort level for us with both American and Indian cultures. Being a banya, I am probably genetically programmed for business and always had entrepreneurial aspirations. A business connecting the US with India was always an attractive prospect.
I received a Bachelor's in Electrical Engineering from Ohio State University and an MBA from Carnegie Mellon University. After that, I joined Oracle when it was a small, up-and-coming company in Silicon Valley.
During my two years at Oracle, I had the opportunity to see very rapid growth based on offering a compelling proposition to its customers. This experience shaped my approach to business when I founded TechBooks with Neal and Anita.
TechBooks was based on a business concept provided by my father. Seventeen credit cards, in various family members' names, which added up to $250,000, were used to finance the business. It started as a small publishing company, which specialised in reprinting college engineering textbooks.
As we did reprints for the major publishers, we realised that publishers were paying very high prices to get their technical books typeset. My brother, sister and I saw an opportunity to leverage our connection to India to deliver a more cost-effective, technological solution to our customers.
In 1992, we launched typesetting of technical books and journals and later exited publishing altogether. Initially, the idea of sending typesetting offshore had limited acceptance among publishers.
Also, our use of SGML, a precursor to HTML/XML, was not something that was widely accepted among publishers. By the late 1990s, the broader market acceptance of offshore production and XML expanded the opportunities for our business.
This market acceptance led to rapid growth, which has allowed us to expand from $3 million in 1997 to estimated sales of $46 million this year.
After our first $2 million round of equity investment in 1997, we were able to make a friendly acquisition of a competitor. This was followed by several additional rounds of investment and a few more acquisitions in the US.
The key driver of our growth has been offering a compelling value proposition, in terms of cost and technology, to our customers. This approach has led to establishing strong, long-term relationships with customers where we have become their trusted partners for content outsourcing.
We have focused on our global business model to build up our resources and capabilities over time, instead of being distracted by the latest trends, such as the Internet bubble. I believe this focus and positive attitude has helped us to become a leading company in our industry, which engenders loyalty from employees and customers.
Today, we are the largest company offering the range of services that we provide to publishers. TechBooks is well positioned to capitalise on the growth in content outsourcing.
This market is rapidly expanding as structuring and distributing content electronically becomes an increasingly important activity for publishers and content-intensive organisations. We plan to continue expanding the range of services we offer and the markets we serve.
As told to Jai Arjun Singh