16. Creating Opportunity and Disrupting a Traditional B2B Industry | Rajat Jain

Slide Ep. 16: Interview with Rajat Jain


Creating Opportunity and Disrupting a Traditional B2B Industry

EP16-Rajat Jain

There are those entrepreneurs who seize an opportunity where others only see adversity, and then there are those who disrupt industries and thrive. In this interview, we have a discussion with one such disruptor – Rajat Jain (Founder, EOXS) – who talks to us about his journey as a tech entrepreneur. Rajat tells us about what motivated him to launch his own business, what he learned from his previous startups, and how he identified a gap in an industry that is traditionally known to be slow to change and dominated by global conglomerates – steel.

Topics discussed in this episode:

  • Rajat talks about his current venture: online marketplace for the steel industry. [2:17]
  • How Rajat identified this opportunity to trade steel online. [11:30]
  • Rajat believes there will be a massive change in the B2B space in the next 5 to 10 years. [16:11]
  • Rajat shares one piece of advice to fellow entrepreneur: customer market validation. [23:51]

Resources & links mentioned in this episode:

Transcript

SPEAKERS

Christian Klepp, Rajat Jain

Christian Klepp  0:08  

Hi, and welcome to the B2B Marketers on a Mission podcast. I’m your host, Christian Klepp, and one of the founders of EINBLICK Consulting. Our goal is to share inspirational stories, tips and insights from B2B marketers, digital entrepreneurs, and industry experts that will help you think differently, succeed and scale your business.

All right, ladies and gentlemen, welcome to this episode of the B2B Marketers on a Mission podcast. I’m your host, Christian Klepp. And today, I am absolutely delighted to be joined by someone I consider to be a very talented entrepreneur and I dare say also an industry disrupter. So Mr. Rajat Jain, Welcome to the show.

Rajat Jain  0:48  

Thank you. Thank you, Christian.

Christian Klepp  0:50  

Yeah, so it’s, you know, it’s been a while since we met at an in person event in January. And it’s certainly nice to connect once again, although for the time being, it’s gotta be on an online platform, like Zoom.

Rajat Jain  1:03 

Good old days, right? Like, that was just like, I still remember pre-COVID right? We are going out… And I don’t even know when that’s going to happen anymore.

Christian Klepp  1:12 

Exactly. And it was the middle of winter too, but I guess the company more than made up for it. So you know, let’s, let’s get started with this conversation. And you know, just tell us a little bit about yourself and what you do.

Rajat Jain  1:25 

Okay, so as you know, my name is Rajat, and I am the founder of The Steel Store. So now it’s called EOXS. We just went through a rebranding. Right. And yeah, like, it’s an online marketplace for the steel industry. Right. We started this like, a year ago, last year in August, and we’ve been through good and bad times. COVID has been difficult, like, I would love to be with my team, work with them. But we are just getting past one day at a time.

Christian Klepp  2:01 

Yeah, absolutely. No, thanks for sharing that. And we’ll circle back to the topic on COVID in a second, but yeah. Tell us a little bit about, you know, on the topic of rebranding, and what you’re going through at the moment, tell us about a current project that you’re working on that’s got you really excited.

Rajat Jain  2:17 

Sure. So Christian, as you know, we are working on building an online marketplace for the steel industry. We started this venture last year in August, with a bare minimum investment of like, $1500 dollars. And we went from inception to launch in two weeks. I mean, that this was my third startup after two failed startups in two years. And we were only left with a team of three people. My Product Manager and my Project Manager, so those guys thought I’ve gone crazy, gone nuts, like what is this guy coming up with? Right? He has like really a bare bones structure, MVP online website, which we put out in front of the customers, and it picked up, like the first month we did like $91,000 in sales. And from there we went like 30% month on month growth, with like, $700,000+ in sales last month. And in the last two months, we grew our team from 3 to 19 people.

Christian Klepp  3:26 

That’s an incredible achievement.

Rajat Jain  3:30 

It’s, a lot of, I would say 24 hours straight working days. Right. I still remember like, around six weeks ago, I was doing Saturday, Sunday, 30 minute interviews, 9am to 9pm, straight 12 hour, 24 interviews. On a weekend, I was like doing 48 interviews, and we just got recently funded by one of the best investors and accelerators on the west coast. Right. So that has been something which has been pretty exciting. And we are already we’re starting to work on the data points for our era.

Christian Klepp  4:07

I have to apologize in advance for that. I mean, like, something exciting going on in your life. I think that was the massive, like a massive understatement.

Rajat Jain  4:17 

Surely.

Christian Klepp  4:19 

But I mean, my God, first of all, thanks for sharing that with us. I mean, this is really the textbook definition of grit, and bootstrapping. Right. I mean, you know, all these, what you’ve just told us in the past couple of minutes, and how your company’s grown tremendously in the past couple of months. I mean, that in itself is a very commendable achievement. But we’ll get back to that in a second. Because I think that’s a very interesting topic, especially for this conversation.

So Rajat if you know as you’ve mentioned, you’ve been an entrepreneur for quite some time now. And this is something I like to ask my guests. Well, those that are entrepreneurs anyway. What prompted you to take that leap of faith? Because you know, it is in many ways, a leap of faith into the world of entrepreneurship.

Rajat Jain  5:09 

See Christian, like, I have this as my company motto, try and fail rather than fail to try. Because if you don’t try, you’ve already failed. And this is the mindset I try to instill in everyone in my team. See, we are raised in an environment where we are taught not to take chances, and lead a very secure life. But what’s the fun in that? Right? Like, if I know how my next 10 years are going to look like, it’s so boring, right? If I know I’m going to start making $80,000 and I’m going to get a 10% hike every year. Right? And I know exactly how it’s going to go. I mean, I don’t really find the thrill in that. I have been an action junkie throughout my life. And I’ve always tried to pursue my passion. I don’t know if we spoke when we met, like, I used to be a poker player, I used to be like, I was a poker player for two years straight. And I used to be a day trader in the stock market. So I think I have that zeal for action. A lot of people would say that, hey, why are you so hungry about money? I don’t really, I don’t think I’ve really come across a lot of entrepreneurs who really do it for the money. You just got to do it. You know, my trying metrics are: do I have food to eat, do I have a roof over my head? If that is there, I’m fine. I can get past like, the next day. I can get past today, you know? So, try and fail rather than failed to try.

Christian Klepp  6:49 

Yeah. No, I mean, that’s, that’s absolutely amazing. And, you know, I would know, a lot of people that will tend to disagree with this appetite for risk, but that’s probably because, you know, all they want is stability, and security. And especially during this kind of period where there’s a lot of uncertainty. But I think if this pandemic, and this crisis has taught us anything about that, is that even if you have a stable job, that job might be gone.

Rajat Jain  7:12 

Exactly, there is nothing stable. You know, like, you can be working at the tier one tech companies in the world, and you can be like, laid off in the next one hour. Right. And I don’t even know what is stable. Right? So I agree with you. A lot of people do disagree with me, right? I mean, we can agree to disagree.

Christian Klepp  7:35 

Indeed, indeed. But yeah, just to answer your question. No, I didn’t know about the, you know, the poker player part. But that probably explains your, knack for taking a gamble. Right. It really quite literally.

Rajat Jain  7:52 

Sometimes, it really backfires also, sometimes it blew up on my face. Right? But it’s okay. It’s all in one life.

Christian Klepp  8:01 

Indeed, indeed. So I mean, you know, just to discuss that topic further on, you know, on entrepreneurship. I mean, what were some of the challenges that you faced early on this journey, and what did you do to overcome those adversities?

Rajat Jain  8:13 

So, I started my entrepreneurship journey personally, like three years ago, right. And I had a really high paying job. The biggest challenge was make that decision to discontinue what I was doing, and try something which worked, which might work, which might not work. Right. Taking that decision.

Then the second challenge, I would say, was shifting my mindset from being nine to five, to making my life: Get up workout, work, sleep, repeat. And the biggest I would say, the challenge I face was adapting to the emotional swings you have to go through being an entrepreneur. You know, one bad investor call, one bad customer call can take your entire day down the drain. Just keep going, and keep having that positive attitude, in front of your team in front of your customers, suppliers, everyone in the ecosystem. I think that’s a real bigger challenge.

Christian Klepp  9:28 

Right. And I think you brought up a lot of great points. And I mean, you know, and I believe it also has something to do. It’s a mindset thing at the end of the day. Yeah. Because as you mentioned, at the beginning of the conversation, we were, you know, we’ve gone through school and university, and we were trained to think a certain way, right? And it more often than not, especially as time progresses, and you dive into the world of entrepreneurship or not even entrepreneurship itself, but let’s say for example, you shift to a different industry. It requires you to think in a different way. It requires you to unlearn, you know, certain habits or certain mannerisms that you’ve been conditioned to accept and learn, you know, in previous roles, right?

Rajat Jain  10:14 

I would agree with you there Christian. And unlearning is the much more difficult part. Like, it’s always I believe in the reprogramming process, it’s the unlearning part, which is more difficult.

Christian Klepp  10:28 

Absolutely, absolutely. So Rajat, we’re gonna circle back to, you know, the topic on your business in the industry you find yourself in, because I think that one, that one in itself makes for an incredible conversation. So you’ve built a very successful business with your access or the steel store. And I believe you posted a description about it in a while back on LinkedIn, you’ve changed it since then. But I thought the description was so apt, because it summarizes what you are in 10 seconds. Yeah, at our core, we are a tech company, we just happen to trade steel.

So here comes the questions. Because I worked with clients in the steel industry before as we you know, as I told you when we first met, so how did you identify this opportunity to trade steel online? And how did you convince your target audience that this was the right option for them?

Rajat Jain  11:25 

Okay, so pretty interesting story behind that.

Christian Klepp  11:29 

Yeah, I’m sure.

Rajat Jain  11:30 

My second startup failed, right? I’m close to getting broke, and have less money in the bank. Right? And I’m burned out. So I decided to take a trip to Mexico, I needed to take a week off, clear my head and come back and then figure out what we do. And I’m on my trip to Mexico. And I’m just thinking of options. What do I really need to do? Right? I as you know, like I was building social apps before, right? And I was thinking of going back to the steel industry to my day job. And I was like, why? Like, it got me to a point where I got started to get frustrated about all these issues the steel industry had, where it is so old fashioned and outdated.

Yeah. And that’s where I got this idea that I have product, like, I have found a market fit. I have domain experience. Now I know how startups work. And I think I have a pretty good idea about how to hustle my way through fundraising. Right. So why not build something for an industry, which I already know. And I already because I had a sales profile, sales background in the steel industry, I already knew what were the gaps in the industry. So surprisingly, like I literally called the server, and I was like, Hey, can I get a pen and paper and I had drafted the whole low fidelity wireframes in the flight itself. We build a product, and we rolled it out. We learned a lot from our first two failures. And this time, we started listening to our customers instead of building what we felt was right. And yeah, I mean, that was the way for us to go. I think the steel industry is a massive industry. It has like a market size of $1 trillion dollars and but it has barely grown in terms of technology, and even culturally. And bringing the right tools, I think we can bring some disruption here.

Christian Klepp  13:30 

That’s an incredible insight. And I think you also answered my second question, which is about where you add value to the industry. So that was amazing. And yes, you know, absolutely. I mean, the steel industry is one that’s in dire need of change. And I think it’s incredible that you found that, gap. Still working on it, yeah, but I think you, you brought up a really interesting point, which I think is a classic case study of tech startups or SaaS businesses that, you know, you’re building something that the market needs, and you iterate it and improve it by listening to your customers. Ask them, you know, in contrast to something that the founders agree upon, or that’s something agreed upon in board meetings, and then when you take it to market that doesn’t work, right. It’s something.

Rajat Jain  14:18 

I would like to add something here. I like to take an analogy of a toddler here. Right? If I need to do it, that’s the best donut in the world because it’s my baby. Nobody cared about it. Right? To the customer. Market validation first, then product, right? If, you are not listening to your customers, you’re not going anywhere. The customer is the one who’s going to actually help you build the product. You take the donut to the customer, they’ll be like, Oh, I don’t like the color, I don’t like the shape, I don’t like the taste! Right. You start bringing in the future.

Christian Klepp  14:52 

Yeah, you’re absolutely right. You’re absolutely right.

Hey, it’s Christian Klepp here. We’ll get back to the episode in a second, but first, Is your brand struggling to cut through the noise? Are you trying to find more effective ways to reach your target audience and boost sales? Are you trying to pivot your business? If so, book a call with EINBLICK Consulting, our experienced consultants will work with you to help your B2B business to succeed and scale. Go to www.einblick.co for more information.

So you know, I mean, thanks for sharing that. And, you know, your business model, if I understood it correctly, it mirrors that of an e commerce platform, which is incredible, because it’s usually associated with companies that operate in the, you know, the business to consumer ecosystem. So you I know that you’ve written about this extensively, at least from what I’ve seen on LinkedIn. But one of the articles that you wrote was for a publication called Total Retail. And that one was interesting, because you mentioned that you believe that B2B e-commerce will experience an explosion or evolution and that it will gradually modernize because right now, it’s still at that stage where it hasn’t reached maturity yet. So can you explain why you believe this is the case? And what factors do you think will cause this transition?

Rajat Jain  16:11 

Yeah, sure. So in the last 10 to 15 years, we’ve seen this technological revolution. Here’s the thing about technological revolution, our average entrepreneur age group is anywhere between 18 to 25. Right? Now, I’m a 22 year old, I only would build a product, I would only solve a problem where I would have a problem. What 22 year old would have a problem in electrical, or steel or rubber. Right? So everyone in the entrepreneurship space has been focusing on B2C. B2C is kind of getting very saturated now. And that’s where now I actually speak to industry leaders, I speak to people in the, I spoke to an ex-director for GE the other day, right. And he worked in the electrical segment. There is probably just 2% penetration so far into the B2B industry. The biggest reason is that the B2B industry is so relationship driven. And there is the sort of anarchy, which has been created in these industries, right, that it’s very difficult to penetrate these industries. But in 2020, we do see a lot of change happening. I think we are moving from baby boomers, to the millennial and the Gen Z at generation now. Right? And the new generation is becoming very frustrated with the old fashioned way things are being done in the industry. Right. So I do think that we are going to see a massive change in the next 5 to 10 years in the B2B space and that can be like, across the board.

Christian Klepp  18:12 

Right, exactly. And I mean, to the point about like the current pandemic, I mean, would you say that a pandemic has also accelerated the pace at which this transitioning is happening?

Rajat Jain  18:21 

Oh, definitely. Definitely Christian. Like, if I were to ask anyone in the steel industry to get on a Zoom call with me eight months ago, they wouldn’t go with the Zoom call. I had situations where I had to fly from here to Chicago or drive from here to Chicago for a one hour meeting. Right. So it used to be 20 hours of driving for a one hour breakfast meeting. Right. And it’s become the necessity is the mother of invention, right? So now it’s become a need and everybody shifting, and I don’t really think we’ll go hundred percent back to the way things were, even after, like post-COVID even after things get to normal. Right. We will never see the normal we had pre-COVID.

Christian Klepp  19:09 

Exactly. And I mean, to your point, yeah, absolutely. I mean, you know, in a couple of months ago, you couldn’t get people like on the Zoom call, it had to all be in person, Now obviously, they’re gonna think twice before doing that, or if you ask them, can we get on a Zoom call? They’re not gonna hesitate. Yeah. And certainly, you know, to the point about your business model, you know, disrupting an industry which has been so traditional, so monopolized by giants with the likes of ArcelorMittal, CITIC, POSCO and so forth. Digitizing and advancing the technology in these industries, probably might be to their advantage in the long run. They might not see it right now. But it will certainly help them to work more efficiently and you know, effectively and you know, in industries like steel and It’s always about, reducing production costs and maximizing outcome, wouldn’t you say?

Rajat Jain  20:06 

And so, how we position ourselves Christian is, we like to bring value, add to the supply chain. Right? Everyone in the ecosystem. We are not trying to take anyone’s space. We are a technology firm. And we would like to stay like that. We don’t want to get into steel production. What we are providing our suppliers, customers, processors is the right technology tools so that it can function more effectively. Right. And I don’t think we’ll be crossing like, we’ll be stepping on anyone’s toes by doing that. Talking about getting to big giants, like ArcelorMittal, I barely know what I’m going to do three months from now. So like, I function with a two week process. I know what I’m going to do in the next two weeks, and just keep going.

Christian Klepp  21:12 

That’s a very fair point. So you know, Rajat, you’ve been an entrepreneur for a while. And, you know, as you’re probably aware of, there’s a lot of these so called the commonly held beliefs or conventional wisdom. So just state one commonly held belief but other entrepreneurs have that you passionately disagree with.

Rajat Jain  21:38 

Okay, there honestly, there are so many of them. Yeah, just pick one. Okay, fundraising. Huh. Right. I hear this so much Christian, that how can we build something which can be funded? And I have disagreement with a lot of entrepreneurs, why not build something which is profitable? And right, why are we focusing so much on creating a business as a story for an investor which can be funded? I rather focus on creating value in any space. Right? And if you are creating value, you will be profitable.

Christian Klepp  22:24 

Yes, indeed, indeed.

Rajat Jain  22:27 

So I would really like disagree with this one thought where I speak to an entrepreneur, and he’s like, Oh, yes, I’m building a business and I’m going to go out raise funding. Right? Do you have sales? No. Do you have a team? No. Right. Have you identified the market? No. Have you spoken to customers? No, I just have a thought. And I’m going to go with this thought. And I’m going to see if I can get funding.

Christian Klepp  22:53 

Good luck.

Rajat Jain  22:56 

Yeah, exactly. Good luck.

Christian Klepp  22:57 

Oh, wow. No, that’s how that was a really great point.

Rajat Jain  23:03 

Entrepreneurship is first about building a business. And then it’s about fundraising.

Christian Klepp  23:09 

Indeed and not the other way around!

Rajat Jain  23:12 

Yes. I mean, don’t get me wrong, fundraising is a very important aspect of it. And you really, like an entrepreneur needs to really know how to be good at it. Right. And an entrepreneur needs to know how to take no as an answer. Right. But not the other way around.

Christian Klepp  23:28 

Right? Indeed, indeed. So you know, seeing what you’ve gone through, not just with this business, but you know, with your other like, with the other two businesses that you that you started and, you know, the experiences and the hardships that you’ve gone through there. What is the one piece of advice you wish that you would have gotten when you started out that you would like to share with other entrepreneurs?

Rajat Jain  23:51 

I think I actually covered that in the previous question, that is, market validation. Our first startup, it took us 18 months to go live, from inception to look, it took us 18 months. After 18 months, we were so happy and we were like, you know what, Oh we’ve built it, they’ll come. Guess what? We waited three months? Nobody came? Yeah, right. So I remember reading this somewhere. I think it was in the Lean Startup: When you launched and you like your product, you took too long, go to market fast, build fast, fail fast. Right, but get market validation first. I see this common mistake in entrepreneurs that they would spend ages to perfect their product and they will not take it to market. Right? Take it to market guys. Your customer is going to tell you if they want it or not. So that’s the one piece of advice I like to give any entrepreneur that get market validation over product development.

Christian Klepp  25:10 

Right. And that’s pretty solid advice. I mean, like, you know, you talk to the market and make sure that you’re building something that, you know, it’s actually addressing or solving a pain point that the target audience has now. Yeah, and to a point you mentioned earlier in the conversation, you also have to identify who that target group is.

Rajat Jain  25:27 

Start small. I think that’s another piece of advice I would like to give someone is the people try to do everything. I’ve had people come up with like a big intensive, like, a product, which would probably have like 16 product market fits, in 4 or 7 geographies. Right. That’s small, start with a small, pick a niche and in a smaller geography, right. People love you, find those 10 people who love you, those 10 paying customers.

Christian Klepp  25:29 

That’s no, indeed, that’s absolutely true. No, I mean, you know, Rajat, this has been such an excellent session. I mean, you know, thank you so much for coming on and sharing, you know, your experience and, you know, telling us a little bit about your successes and challenges. So what’s the best way for people out there to connect with you?

Rajat Jain  26:22 

The best way to connect with me on LinkedIn, I’m pretty active on LinkedIn, I still don’t have a Twitter account. My PR team was all after my life to actually get started with one. Right, I can barely manage one account. So I would say LinkedIn would be the best way to get connected with me, Christian.

Christian Klepp  26:39 

Fantastic, Rajat. This has been an incredibly informative conversation. So thanks again for your time. Be safe, be healthy. Take care, and I’ll talk to you soon.

Rajat Jain  26:49 

Thank you so much, Christian, thank you so much for having me and you be safe and have a great day ahead.

Christian Klepp  26:55 

All right. Thank you. Bye.

Thank you for joining us on this episode of the B2B Marketers on a Mission podcast. To learn more about what we do here on EINBLICK, please visit our website at www.einblick.co and be sure to subscribe to the show on iTunes or your favorite podcast player.