Vinod Gupta, a self-made business powerhouse located in Omaha, Nebraska, started with humble roots. Born in a small village in India, Gupta recognized the life-altering power of education, and parlayed his smarts into a successful undergraduate, and graduate experience. Upon finishing the Master’s program in Business, and Agricultural Engineering, Vinod Gupta’s first foray into the business world began as a result of an astute observation.
Employed within the Marketing sector of a mobile-home manufacturing company, Vinod Gupta was tasked with supplying an exhaustive list of national mobile home dealers for his employer. Frustrated with the lack of existence of such a comprehensive list, Gupta set out to solve the problem by creating the database independently. Working after-hours, he quickly completed the encyclopedic task, and after his employer passed on the exclusive rights to this list, Gupta’s entrepreneurial spirit began to shine. He took out a $100 loan via a local bank, and invested those funds into direct mail marketing, and his ROI was almost immediately. Very quickly, he amassed pre-orders, and requests from several businesses who were vastly interested in his product, and saw the value in utilizing such a database.
It was precisely at this time that Gupta’s business, American Business Information, was borne. The company thrived, amassed incredibly vast numbers of varied databases, and essentially provided the first streamlined manual search results based on national phone book records. Eventually, the database juggernaut started by Gupta sold for $680 million.
Currently, Gupta enjoys his position as Managing General Partner of Everest Group, a company that provides venture capital for businesses within the database technology field, specializes in providing private equity and business acumen to underperforming businesses, and offers extensive consulting services.
How did you get started in this business? What inspired you to start this business?
Since youth, I have always harnessed an entrepreneurial spirit, along with the understanding of the power of education. Thus, after my post-graduate studies were completed, I entered the workforce with a keen eye for innovation. At the time, I was employed by Commodore Corporation, and simply recognized a gap in a service that I understood to be useful, desired, and most importantly, currently unavailable. It was simply a matter of parlaying the demand of this type of technology, into an initial foray toward solving a problem. Upon completing the first database, and marketing the materials to several other businesses, I began to receive a lot of instant positive feedback, interest, and pre-orders. Thus, my insight was immediately legitimized, and I understood the idea that if one type of business benefited from a database service, all businesses would benefit from it.
After forming American Business Information, the individuals involved in the company worked diligently to expand our offerings quickly, and to provide the best possible service for our clients. With the changing of the times, and integration of many various technologies, ABI, and then InfoUSA, sought to create a larger market audience, and naturally, the need for our technology persisted.
How do you make money?
As with any service related profession, the company garnered profits by providing database services for clients. Initially, the sales of our database products equaled profits, which were immediately reinvested into the continued development of the company. With Everest Group, we provide venture capital for database upstarts, and consulting services for businesses that are currently underperforming. Upon successfully revamping these companies, and returning them to profitable status, Everest Group retains some of the profits from the revamping of these companies.
How long did it take for you to become profitable?
Honestly, American Business Information was profitable prior to its inception. Upon creating the first database set within the mobile home niche, we received several pre-orders, and immediate interest in the product. Thus, we did not go to market without having a proven demand, and were confident in the market need for our product. Initially, I invested a $100 bank loan into direct mail marketing, which was the basis for the initial pre-orders, and allowed the project to start gaining traction prior to bringing goods to market. From there, we extensively researched our markets, and took very calculated risks, retaining our profit status.
When you were starting out, was there ever a time you doubted it would work? If so, how did you handle that?
When I was tasked with the project of creating an exhaustive list of mobile home vendors on a nationwide scale, I immediately recognized the gap within the market. Thus, I was confident in the product that I was presenting. However, I was met with doubt from others! There were certainly people who thought that I was wasting my time, and doubted the path that I was choosing. However, I trusted my gut feeling, my knowledge of the gap in the market, as well as the feedback that I received in the early stages of creation of the database. With all of those factors in mind, I was confident that the risk was well worth the potential reward. When young entrepreneurs ask me for business advice, I relay this particular rule that I try to live by within the business realm; If you have invested a lot of funds in a particular project, limit your risks within the scope of that project. If your investment isn’t extensive, you can freely take larger risks.
How did you get your first customer?
Initially, my first customer (other than my employer) came in the form of a pre-order from a mobile home purveyor. From there, potential clients reached out with their database technology needs within similar fashions. Eventually, InfoGROUP began to absolve other businesses, grew our product offerings extensively, and enjoyed customers from various sects of technology, including applications, mapping services, and concierge services. The advancement of mapping services, as well as the ease of applications, makes this a very exciting time to be in this business. The market is wide open for new database needs, even if clients aren’t aware that they are utilizing a database. For example, when a customer utilizes a mapping service to receive directions to a particular location, they may be utilizing our database services to receive notification of nearby restaurants, hotels, or whatever else they may wish to discover.
What is one marketing strategy (other than referrals) that you’re using that works really well to generate new business?
Through the advancement of technology, email marketing, social media marketing, and digital marketing in general has certainly soared. However, I have found great success in traditional direct mail marketing. When ABI was initially borne, we relied heavily on direct mail marketing, which has proven to be effective in garnering business-to-business customers. I find that in today’s fast-paced world, emails are extremely easy to be deleted without viewing them, but there is something completely tangible about the experience of receiving physical mail, especially if it is aesthetically pleasing, and created thoughtfully.
What is the toughest decision you’ve had to make in the last few months?
Within my current role, I find myself in the position of having to determine whether or not to take on a particular business as a new client. We receive a lot of interest from underperforming companies looking for a refresher, and looking for operational guidance. Thus, at times, it is difficult to predict the possibility of success for each company. Additionally, from an operational standpoint, it is sometimes difficult to discern between the value of garnering new management talent, versus effectively counseling existing management talent.
What do you think it is that makes you successful?
Throughout the many years in which I have been involved within the realm of business, I have found it imperative to be able to focus on long-term goals. It is incredibly easy to get caught up in day-to-day operations, and as a result, not develop long-term business goals. Thus, I have found that my own success is somewhat linked to the successes of my team. When providing operational support for other companies, I try to impart the importance of having a trustworthy, driven, and motivated managerial team in place, which allows business owners the freedom to focus on growth, expansion, and other long-term goals.
What has been your most satisfying moment in business?
I have always found it to be profoundly satisfying to provide new successes to an underperforming company. Through Everest Group, we provide operational counseling services, in addition to financial support, and often dedicate our assets to aiding underperforming companies that are on the brink of failure. I take these ventures as opportunities to parlay my knowledge, and to create positive results.
What does the future hold for your business? What are you most excited about?
With great advancements within the realm of artificial intelligence, the market for database technology will continue to broaden. As applications continue to utilize geotracking technology, and consumers expect geographically sound information at their fingertips, the need for databases based on location will continue to thrive. Thus, I’m excited to see how artificial intelligence will continue to impact my business. Today’s young adults are delving into entrepreneurship at early ages, and are excited to push the brink of technology. Recognizing the potential success of non-traditional routes, many young adults are taking business risks, and creating their own ventures within the realm of technology, business, and start-ups. It is an exciting time to be involved within these ventures, and I am proud to provide venture capital for young entrepreneurs entering the field of database technology.
What business books have inspired you?
Though it is out of print, one of the most profound books that I have read is entitled “Managing”. The book is penned by Harry Geneen, the man essentially responsible for putting together ITT, my alma mater. Within this book, there are many valuable lessons that anyone can implement, especially those who’s professional roles lie within management.
What is a recent purchase you have made that has helped with your business?
From a very early age, the importance of education has been bestowed upon me. My father, a doctor, has spent countless hours tutoring me, and enriching my voracity for knowledge. Throughout adulthood, I find the newspaper to be of utmost importance within the business realm. Each day, I spend roughly one hour reading the newspaper, familiarizing myself with the newest stories about business, current events, and technological advancements. Not only do I find this time to be therapeutic and serene, but it is also an unparallelled opportunity to keep abreast of the current trends within business.
How do you maintain a functional and successful management team?
Throughout my experiences managing several businesses, I have found that maintaining the integrity of the managerial team is crucial toward long-term success of a business. As I’ve mentioned, being confident that the day-to-day operations are taken care of appropriately allows business owners to focus their efforts on expansion. Thus, as a business owner, you have place great confidence and faith in the management team. Historically, I have found that rewarding the managerial team for their dedication, loyalty, and hard work is the best way to ensure that standards are continuously upheld throughout day-to-day operations. When management teams feel valued, they will undoubtedly want to be a part of the business’ success, which they will feel much more connected to.
What are ways in which you can help failing businesses become profitable, and successful?
Though each company is different, and circumstances may vary in each case, there are certain aspects of business that require great attention in order to be successful. For example, cutting costs is a surefire way to allow a business to have more fluid capital to utilize for other needed aspects of the business. When we work with businesses, we look for ways in which we can cut costs, without sacrificing integrity. Additionally, the notion of streamlining processes is also crucial toward decreasing manpower, and creating results with limited efforts. The old saying “work harder, not smarter” certainly applies toward this approach, and thus, we look for ways to make the most of the steps related to a particular business’ operations.
In any business, customer service is also key to long-term success. Even if a particular product is amazing, that product’s integrity will be tarnished if customers cannot receive a positive customer service experience in a timely fashion. Thus, for many failing businesses, we implement and restructure the customer service experience, and instantaneously see a positive result. Through investing in customer service, we essentially secure the reputation of a business, a product, or a service offered by a particular company. In today’s society, where customer reviews can tarnish the reputation of a business very quickly, the concept of positive customer service feels more crucial than ever.
Finally, we invest in the utilization of new technologies for businesses. Sometimes, updating certain technologies is enough to completely transform an otherwise outdated company. With newer technology, the company can then compete within the current market, produce a product on a larger scale, or enjoy a smoother customer experience.