Yogendra Vasupal says his time in jail has made him stop victimising himself, because he saw many others with no support at all.

The Yogi interview Stayzilla CEO on spending 30 days in jail business cheats and his future
Atom Stayzilla Friday, April 21, 2017 - 18:35

For someone who has just spent 30 days in jail, Yogendra Vasupal, co-founder and CEO of Stayzilla, seems peppy and upbeat. He calls himself an eternal optimist, and the jail debacle and multiple accusations being thrown at him do not seem to deter him. There is a sense of enthusiasm and confidence in his voice. Vasupal is confident that he, his family, and his company, will overcome this situation in no time.

In a conversation with The News Minute, he talks about his time in jail, which he says made him realise the larger problems in businesses. He says that he received support from the startup ecosystem only because he asked for it, and that all the issues in the startup sector are coming out only because of its transparency. Vasupal is already back to thinking of starting the second innings of Stayzilla as an experienced entrepreneur.

Here are edited excerpts of his interview

Q. How was the jail experience? Are you feeling victimised?

The police at the station who were investigating understood that there is more to it than the one-sided complaint that they had received. Despite that, they kept trying to convince someone. They kept going outside, speaking to somebody, and coming back and telling me, “Yogi I’m also a situational prisoner and I don’t like what I’m doing but had to do it. Why don’t you settle and close it? You can give him some cheque for a future date so we don’t have to file a case on you. There is pressure to file a case if you don’t agree to settle.” I told them that I can’t settle on principal. I have proof that I was the one who was cheated.

Aditya used call us from offices of different MLAs. Those are call recording we haven’t released to the public because we don’t want to get embroiled in some political controversy. The MLAs would ask me to come their office. I would then try to explain the issue. Aditya will pick up the phone from there and say I will take whatever steps I want to, to collect my own money. We told him that if he felt that we aren’t paying him the money we owe him, please go to the civil court and file the case. He has a right to justice. We have documents. This has been our stand right from the beginning.

But the fact is that when you turn it into criminal, you are removing one party’s voice to seek justice. I was in jail, Sachit was absconding and then a lot of stories got put out, which were nothing less than slander, like me siphoning money.

The positive side is that I got to spend 30 days in jail and that was a completely different experience.

It gave me time to think of larger level issues. I didn’t even know Aditya’s mom was a proprietor, and definitely did not know about his father. I don’t have any hard feelings towards them, because a dad will help out a son, you cannot do anything about it. It’s his duty.

I met a lot of people in jail and learnt how justice works in India. I feel it can be made a lot more efficient. There are businessmen who had civil disputes with contract and with an arbitration clause in the contract but are still inside because the other side was politically influential. I felt very victimized when I went to jail but I saw many others, even one ecommerce grocery company based out of Chennai. When I met them, I realised that there is no point in feeling victimised.

Q: Disputes happen in businesses all the time. But with the importance and hype given to the startup industry, do you think you were targeted?

In India, if you want to grow beyond a particular point, you have to know how to deal with the system – you need to have some political patronage, you need to have some backup.

Startups is one of those ecosystems where this thing did not happen. We could grow without having to worry about political influence in the business or growth of the company. One of the key reasons why that happened was because funds that came in, came in a structured way and from outside.  Startups are also a business, let’s be clear about that. This issue can be looked at as the first in terms of how the ecosystem responds. The ecosystem did not look at this as a story of Yogi. This is practically the first case publicized large enough where the promoter has been thrown into jail in the absence of political influence. Had Aditya instead gone to the civil court and the court had said there was an intent to cheat and I have to be jailed, I guarantee you, not a single person would have come to my support. And they are right in not coming to my support in that case. 

The very clear objective here was ensure the ecosystem remains clean. What happened here in Chennai can happen in a lot of other places. People know there are systems and processes under which startups function and the right way to take them on is the legal way and not arm-twisted like any other business in India would be.

I wouldn’t call it hype. Intuitively the ecosystem came out and said that this should not be happening.

Q: But don’t you think that if you were just another businessman and not a ‘startup founder’, you would not have gotten the same kind of support?

Inside the jail, there was another startup founder who did not get that support. And he was there before me and he’s still there. But he did not get any support. And I guarantee you, I would not have gotten support either had I not written the blog that my family put out. It was a genuine call for help. I believe the help came because I asked for it and there was some genuineness in it. The blog went up 24 hours after I went to jail and till it went up, there was support, no help-yogi.

And even before this was posted, there were media reports already out that I had confessed to cheating them. Nobody would have supported me then. It was my ability to voice out for support and it was a judicious call that was taken.

Q: There have been many other stories of startups not paying vendors or cheating employees. Do you think there is a rampant culture of not fearing the law or of paying up?

The other side of the coin of not having political influence is that people feel freer to take you on. A company the size of Snapdeal can be called out by company like CouponDuniya only in the startup ecosystem and live to tell the tale. Try that anywhere else and I guarantee you that CouponDuniya’s promoters will be in jail under one issue or the other. This is the most transparent ecosystem. That’s why you will find the most problems, and that doesn’t mean it has the most problems. In a normal business, you’ll have to dig below several layers to find where the problem is. This ecosystem is transparent enough. That why issues are coming out. And that’s a not a bad thing.

Let these issues come out. Because we are getting learnings thanks to the transparency in the ecosystem. If political influence starts coming in, you will lose the transparency.

Q: What are your plans to reboot the business back on track?

The plan I had already thought of before announcing reboot was to move from B2C to B2B model. We have done a very big job of creating rooms in the homestay segment. We now understand the needs for the hosts in India. Instead of selling rooms on our platforms to gain users, we will sell those rooms to other platforms and OTAs so that the host can sell not just on Stayzilla but on multiple other platforms. With that idea in mind, we had already started talks with all relevant players in the ecosystem. I had gone to Delhi in March and spoken to all industry people who were okay with it. They did not want to go about creating homestays when they can get it from me at a lower cost.

I was arrested on March 14 and between March 16 and 27, I had nine meetings lined up in Delhi to formalize discussions. Now that I’m out, I’m struggling with the case, which will take another few weeks. I have reached out to the industry people to give me two weeks of time to get back. After that I’m confident I will be able to start off again as a B2B player for hosts, focusing only on the host-side problems and enabling them to sell across all other platforms.

Q: But do you think this entire episode will become a setback for you? Do you think the industry people you were speaking to will have any apprehensions?

I certainly hope not. I’m working on faith here that the startup ecosystem has reached a level of maturity where a failed entrepreneur is not equal to failure. Even with this issue and the support I have gotten, I don’t think it will be an issue. But I will only know in the next one month, right? Or maybe it is too early for an entrepreneur like me who failed to get back up easily. But I know that I will get back up.

Q: So, do you call yourself a failed entrepreneur?

One business model has failed, so it depends on how you want to look at it. The problem is not with failure but with how people look at it. I look at it as a learning.

But yes, one business model failed and there are certain things, which in hindsight, I should have done differently. It’s a learning opportunity that forms a part of my checks and balances going forward. So there is nothing that stops me from starting a second innings as an entrepreneur who’s much better than when I started off.

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