Last week, one of the companies I co-founded, Novatium, was the subject of a Newsweek cover. It is not often that a two-year-old company makes it to the cover of one of the most respected and largest international news magazines. This is the second time in my life that something I have done has been the subject of a cover story. In March 2000, Time’s Asia edition had a cover story on the dotcom boom and featured me as one of the six dotcom entrepreneurs. Here is an excerpt from what Time wrote in a story entitled: the sellout [dot] com AN INDIAN PORTAL TURNS INTO A QUICK CONVERSION TO CASH:
Rajesh Jain made one of India’s biggest business deals of 1999–and ran. Before the score that netted him $115 million, Jain, 32, operated a website known as IndiaWorld, which posted local news and sports scores, primarily for Indians living overseas. His 20 staff members were squeezed into a 970-sq-ft. warren in downtown Bombay. Profits were minimal. But last fall Jain hit a cosmic payday when he sold his portal company, IndiaWorld Communications, to Satyam Infoway, an Indian Internet service provider listed on NASDAQ. The $115 million deal–one of the biggest Internet transactions involving two Asian companies–gave Jain instant celebrity, a whopping bank account and a desire to leave the Internet rat race, at least for a while, to enjoy his winnings.
Jain taught Asia what Silicon Valley has known for a long time: though going public is a fabulous way to cash in on the Internet, selling out to someone else can be a sure-fire moneymaker too. Satyam Infoway wanted content popular with overseas Indians to complement its own domestically oriented portal. IndiaWorld was pulling most of its 13 million monthly page views from outside the country. Jain got an unusual windfall because Satyam Infoway is paying the entire purchase price in cash, not in stock, which is more typical in such deals. His initial investment was $50,000.
The first two years [after starting IndiaWorld in 1994] were spent persuading advertisers to take a flyer. Typically, IndiaWorld managed to grow handily in terms of hits while its profit last year was an imperceptible $58,000. But IndiaWorld earned buzz, and Jain suddenly found himself courted by angel investors, foreign venture capitalists and banks eager to lend. In the end, he decided to get out of the game entirely by selling to Satyam Infoway, one of the largest Internet service providers in India, which doesn’t allow foreign competition in the field. “We already have a substantial audience in India,” says chief executive R. Ramaraj, “and with IndiaWorld, we have acquired an India-interest audience globally.”