top of page

How did JustDial miss multi-billion dollar opportunities?

This essay was a long due. The idea struck me while reading - Everything Store by Brad Stone. The first thought that came into my mind, after finishing the book, was - how big JustDial could have been if it was founded or operated by Jeff Bezos. And concluded: JustDial played safe and missed multi-billion dollar opportunities. This is a contrary POV on success, and many of you might disagree, and that’s okay - disagreements are good! :) Let’s get started.

JustDial - Hyperlocal search engine - story is a fascinating tale that started before the pre-internet era. Even though the internet was being used in Education and research community in 1986, the general access to the internet to the public began on 15th Aug 1995. A Macro view of the data - 32 million business listings, 145 million quarterly unique users, Successful IPO, acquisition by Reliance - and we can chant, JustDial is among the successful internet companies. And to some extent, this is true as well. However, a deep dive into the possibilities and Justdial's leverage explorations indicate a different story.

Just Dial, founded by VSS Mani in 1996, was one step ahead of the Yellow Page concept - where instead of buying a full physical directory/CD, customers can ask for specific business details by making a phone call. It does make sense right? If I as a consumer, would like to know a restaurant in my location, I would avoid buying a 100+ pages physical directory. The business model was fairly simple - a two-sided marketplace for hyper-local businesses and users. The service was free for users, and advertisement dollars from featured businesses were the revenue source.

Justdial, the first hyper-local search company, truly organized hyper-local businesses. Like most industries' first-mover players - JustDial started its operation by listing all types of hyper-local businesses. JustDials' management team focuses on fundamentals and building a profitable company in the initial ten years of its operation. Today, it might be unimaginable to think of a business without a customer-facing UI/UX. But the company was operational without any website.

Around 2007, India achieved a critical mass in terms of internet users - 47.2 million (In 2007, India has a 4% internet penetration of 118 Cr population). It was a good time for JustDial to build its customers-facing web and mobile applications - after 11 years of offering phone services. The business was profitable - clocked revenue of ~70 Cr.

Thanks to bundling, JustDial was growing on both fronts - users and business listing. And it should - India’s hyperlocal businesses (Including all categories) was super unorganized. I remember, in 2014 - we almost cried to procure Wax for the lab experiments in Chennai. Indeed, Justdial was helpful.

Solid monthly growth and a large addressable market allowed JustDial to attract high profiles VCs. Sequoia made its investment in 2009 (I have explained this relevance below.). In 3 years - 2007 to 2010 -, India doubled its number of internet users and crossed $500 GDP per Capita. These two leavers fueled a new set of internet consumer companies.

India crossed 100 million internet users in 2010, and a significant percentage of the population started dining out - especially in urban areas. For consumers, JustDial was the only option to discover local restaurants. This leads to a surge in restaurant discovery on the platform - a signal of unbundling.

Zomato was founded in 2010 with a standalone restaurant search/discovery directory. [Zomato was founded in 2008 as FoodieBay name later changed its name]. After a few years of solid growth, Sequoia India leads the Series A round in Zomato, in 2013. Sequoia India MD GV Ravishankar: hinted the insight on Storm the Norm Podcast. Around this time, the food delivery market was super hot. There were companies - Foodpanda, Ola Cafe, Tinyowl, and Zomato - burning millions of dollars to acquire customers. The one company that has a real chance to win the food delivery market was staying away from the billion-dollar opportunity - JustDial.

Let’s understand this

  • JustDial has the largest local restaurant directory

  • Justdial has loyal users on the platform

  • And they were profitable as well

The JustDial could have used these leverages and built a sustainable food delivery business on top of their hyper-local search engine. I don’t know, what was the thought process, of the management, behind not pursuing the food delivery opportunity. It would have been operationally easier for JustDial to venture.

If I would have been running the JustDial around 2010, and 2011, I would have not hesitated.

JustDial went Public in May 2013, and it was a successful IPO. Sequoia and many other investors offloaded and cashed out their investments. JustDial IPO was one of the biggest by an Indian Internet company.

In late 2014, another variant of JustDial UrbanClap later UrbanCompany launched its services. The way JustDial was one step ahead of Yellow Page, UC was one step ahead of JustDial. Here also, the JD management ignored a billion-dollar opportunity. I mean frankly, it would have been easier for JustDial to execute the UrbanClap model. Again, they had the same leverages.

If you go and ask the UrbanCompany founders, they will agree - they used JustDial to collect the initial inventory for their platform.

In any timeline pursuing the above two opportunities would have been the biggest wealth/value creation for JustDial.

Again, this survey proved my hypothesis. Customers are okay to access the services from a trusted platform - prefer not to switch.

Meituan in China is a good example of using its initial leverage to unbundle and bundle services. Here is a super deep nuance: The super app concept works only for mature internet users. Founders make mistakes in pushing the super app concept to new-internet users - The failure of Mall91 as social commerce was one of the reasons. By the way, Mall91 has built India’s first real group shopping feature - but for the wrong target group. I loved their technology. If you ask them to acquire 50 million new internet users, they could do it at the lowest cost without using FB and Google Ads.

I believe in India if any company had a real chance to disrupt the consumer business - it was JustDial. JustDial could have been a 20+ billion-dollar company if operated with high intensity. I think they completely ignored their value chain. This is a basic concept of the Skill Forward approach - where existing skills and competencies are used to drive business opportunities.

Again, there is a nuanced difference between offering new services on a platform like Paytm and offering food delivery services on top of JustDial. For example, Paytm would like to offer Movie ticket booking to its users (They are already offering this service), the demand is the same - existing users - but the supply is completely different - Cinemahall and Multiplex. In case, if JustDial would like to offer Food delivery or UrbanCompany-like services to its users - Demand and Supply are the same. Again this might sound exaggerated, but I thought about this after reading “Everything Store”. Jeff Bezos had never publically agreed - he was obsessed over competitors or companies offering services on Amazon’s customer value chain. But Jeff tried everything to copy eBay and other variants of eCommerce. Amazon Auction, Amazon Toys, zShops, Videos, Music etc. are a few examples of Amazon keeping its sharp eyes on its value chain.

For example, the success of digital music - iTunes - makes him uneasy and forced his team into uncharted territory, hardware - built Kindle, fireTV, Alexa etc. Amazon utilized a skills-forward approach with innovation and pulled miracles. Jeff operated Amazon with intensity and vision to build World's biggest company. I think there is nothing wrong with having that kind of mindset. I don’t know how Justdial's founder measured their success - I would have been impatient and used leveraged to offer Food Delivery and On-demand services on the platform. The game would have been different - maybe someone from a different timeline will read this and take the necessary action. :)

Sometimes a company make decisions to pursue a new opportunity because those are the necessary infrastructure to conduct its core business: Ekart of Flipkart or Escrow innovation on the Alibaba Platform are a few examples. And another time companies should naturally pursue an opportunity if they have leverage because they have invested money with a vision to maximize shareholders' wealth by creating enough value for all the stakeholders.

Let's take the ZILA example: We have been mapping our customer’s value chain and spending time to have a clear understanding. I have been on the ground - for the past 6 to 7 months.

  1. Understanding the true meaning of customer experience for this Target Group (TG). I see founders repeat this mistake, burn money and finally settle for the same old method. For ZILAs' TG the meaning of experience is not similar to Amazon's Target Groups.

  2. Visiting potential Pickup/CPs prospects across - Districts, Subdivisions, Blocks, and Villages. This is important because the success of a startup is directly proportional to the ability to scale the business at a relatively lower cost.

  3. Meeting and having 1-0-1 conversations with local small businesses across industries - food, apparel, fashion, home&Kitchen etc. I have visited 200+ such small businesses.

  4. Mapping out similar customer persona across states based on customers from current target groups.

One Small anecdote: Many of our partners are, full-time, finance and insurance providers, and we shall leverage this in the future. Here channel and demand will be the same only the supply will be different. Frankly, I have been waiting for my turn and would be ruthless in execution.

Now before we wrap up this essay: A few examples that shall prove why non of the above is a one-hit-wonder. It should be in the DNA of an organization.

There is one fallacy that exists in our ecosystem - companies suddenly wake up one day and decide, hey we must pursue this opportunity for whatever reasons. That's not how it works - the reality is, the process of venturing or starting something new is the same for everyone - a small startup or an incumbent.

  • Formation of a small team with a problem statement,

  • limited budget,

  • learning from users,

  • multiple iterations and

  • after 2 or 3 years, something substantial is Ready to Scale.

Here are two amazing examples:

Apple's success in the online music business - Itune- makes Jeff uneasy. If customers would buy music online, they would also buy books, Videos etc. This leads to the creation of a new division inside Amazon - Amazon Digital Initiatives (ADI). Under ADI, Amazon started building services that could digitize books and Videos. We should take the example of Videos - Amazon has zero leverage.

In 2006, USA consumers had two options to watch their favourite movies or TV Shows on weekends a. Drive to Blockbuster Brick & Mortar store and b. Home delivery by Netflix. In both options, the customer's experience was broken. Why? Imagine yourself driving to a store, scrolling through hundreds of CD titles, Selecting a few, coming back home, watching that on the weekend, forgetting to return to the store, and paying the full price of the CD as a late fee. :)

Amazon started on-demand video (Movies and TV Shows) services in 2006 through a service called Unbox - to enhance customers' experience.

Working process of Unbox:

  • Install Unbox application on PC (Only on Windows, not less than 3 years old)

  • Go to the Amazon website: Discover and buy movies & TV shows

  • Download it on Unbox installed PC (Download duration 4 hours to 24 hours based on internet speed)

The download speed and restriction of downloaded content to only Unbox installed PC were destroying the entire experience.

  • For a while, the team thought of adding automatic download of Movies and TV Shows through a DVD burner. They abandoned the idea, soon.

  • They tried, RemoteLoad: Access Downloaded content from any PC - Download on one PC and access content through the same credentials on multiple PCs.

  • Download movies and TV shows multiple times without extra cost: Content owners were getting paid 70% of the price, and multiple downloads were creating a negative margin in the business.

  • Licencing of content from movies studio to solve the above problem

  • They tried building DRM software to control the download of proprietary content and prevent theft, sharing and reuse by customers. More like credentials sharing problem for current OTT players.

  • In 2007, they launched Unbox on Tivo - Digital video recording devices. And Tivo helped bring revenue and customers.

  • In 2007 - Netflix launched the On-demand Video service “Watch Now”.

  • In 2008 Amazon relaunched Unbox with a new name Amazon Video on Demand (VOD)

  • They kept trying different ideas, kept increasing their Video catalogue and finally in Feb 2011 they launched Prime Video Service.

It took Amazon 5 years to launch Prime Video - Amazon almost had 5 years of On-Demand Video learning before launching Prime Video. WoW!

Today also, Prime Video has no interest in competing with Netflix. The company has a clear understanding of the use cases and their purpose. On Prime Video, you shall find more regional content. I am not sure whether I can use the regional word anymore - the dynamics have shifted, Bahubali Franchise, RRR, KGF Franchise, and Pushpa have changed the game for the good!

Mirzapur is a good example: UP is the largest state in terms of population, and creating a show on one of the popular locality names must have brought new customers.

Amazon purchased Radhe Shyams’ all other languages - Tamil, Telugu, Kannada, Malayalam - except Hindi digital rights at INR 250 Cr compare to Radhe Shyam’s Hindi digital rights bought by Netflix at INR 250 Cr. Can’t go in-depth. The bottom line is two companies offering the same service can have different strategies and purposes. :)

The story of ByteDance TikTok:

ByteDance's flagship product - Toutiao: A news aggregation platform - was performing extremely well. The growth team observed super high engagement on the short video. I think this is a creative lie. Around 2015, the whole China ecosystem couldn’t ignore the ad revenue generation possibilities due to super high engagement on Videos.

The ByteDance team launched two short video products

  1. Huoshan: an imitation of Kuaishou

  2. (Awesome.Me): An imitation of was a team of ten members. And the first experiment was a complete failure.

The product team redesigned to Douyin in Sep 2016, kept learning from its competitors, kept adding new features, they did incentivize content creators at the beginning, and destroyed its competition in China thanks to its investment in the recommendation engine, Acquire rebranded to TikTok and rest is History. It took some 18 to 20 months to bring the right version.

The bottom line is building anything significantly takes time, and there is a lot that can ride on the existing investments and leverage created/built by companies.

If JustDial could have used its leverage, it could have been one of the highest-valued tech companies in India. My takeaways are simple:

  1. Keep your eyes and ears open.

  2. Focus on short-term and long-term both (Concept of And and OR from Book: Good to Great by Jim Collins)

  3. Pick customer and market signals and apply the Skill Forward approach - use demand and supply leverage. JustDial had BOTH.

Published on 08-05-2022 at 04:39 PM on Email and LinkedIn

Recent Posts

See All


bottom of page