?We get more classified advertisements than all the English newspapers put together in India,? says Satya Prabhakar, founder and CEO of Sulekha.com, with a touch of insouciance. Sulekha is one of the most popular Indian Internet media companies, connecting millions of Indians across 24 cities in India and the US. It?s probably the largest and most popular Indian local commerce site, integrating classifieds and yellow pages. Sulekha is also the largest online ticketer for Indian events and movies in North America.

An engineering graduate from REC Trichy, Satya went to the US to get his Masters in computer science and an MBA in international finance. After working for more than a decade at AT&T, Honeywell, TCS and Philips, he decided to take a sabbatical for a year in 2000 when the idea of launching Sulekha took shape. He thought of providing a common online platform for Indians around the world?a platform through which they could share their thoughts and express their opinions. ?People were blogging on Sulekha even before the word ?blog? came into being,? he says.

In 2001, Sulekha was launched in the US with a staff of two people. Satya had put in his own savings initially. Raising funds for a portal was not easy when the dotcom bubble had just burst. With a lot of effort, Satya managed to raise $1.5 million. ?We worked very hard to bring the company to profitability levels. In 2003, we could show profits.? Subsequently, Sulekha received VC funding and went in for an IPO when the time is right.

In 2004, the centre of gravity of the portal shifted to India. The head office was set up in Chennai. It made sense as the original technical team was in the city and so it was the natural place to be. Sulekha started focusing on local commerce. ?Today we get four or five times the classifieds the local market leader in the print medium in Chennai gets,? says Satya. It was in 2003 that Satya decided to focus on classifieds. While providing a forum for blogs was all very well, he realised that there is a difference between ?I like to visit? and ?I have to visit? a site. The traffic logs of Sulekha showed that visits to classifieds were growing by leaps and bounds. ?It was like a self-propelling engine. There was a loop here which we could enter.? Sulekha started focusing on growing transactional needs. People had to sell cars or lease flats constantly. This was the turning point for Sulekha.

Since 2004, the portal has been focusing on building up classifieds. Word of mouth has helped. Individuals can place classifieds free of charge three or four times. Every user has to register a mobile number so there will not be any fake customers. But businesses have to pay. As Satya puts it, an individual?s requirement for placing classifieds is infrequent. Not all individuals are repeat customers. A happy customer who has bought or sold successfully is not likely to return. They place classifieds for pets, shares, even IPL tickets. The Internet is a superior medium for individuals. It has a better reach than print media. ?People can search for flats in other cities before they even get there,? he says.

But businesses have to advertise almost every day. A lot of small- and medium-scale businesses place their classifieds on Sulekha. The SMB outfits pay the portal a sum to advertise for a fixed tenure. ?For this tenure, we guarantee the advertiser a minimum number of responses or leads. If within this tenure the advertiser doesn?t get the specified response, the advertisement is extended for free until the response commitment is met. If the commitments are met way before time, the additional response that is received is free for that tenure.? On any given day, Sulekha gets 30,000 to 40,000 classified advertisements and responses.

Satya said in an interview that the Internet evolution in India will lead to massive unlocking of SMB advertising spends. The low threshold of investment, superior tracking of returns on marketing spend, and global reach will attract them to the Net. He says, ?Our business interest lies in the ever-growing SMB market. In terms of advertising, we prefer to deal with a large number of SMBs who wish to spend smaller sums rather than dealing with big corporates, who seek to spend big to build brands.? He is convinced that SMBs will be a major revenue source for Sulekha.

The portal operates under multiple categories. It is the largest site for rentals and second largest for real estate ads. Unlike FMCG manufacturers like Procter & Gamble or Hindustan Unilever Ltd, who can sustain different brands and products, digital media cannot do too many individual brands and maintain business efficiency and growth. He points out that even Yahoo! could not do this and had to shut down Hot Jobs and Yahoo! Music. Google is the only exception. Sulekha does not take on matrimonial and job ads. It does accept low-end job ads, but not high-end classifieds. Satya feels there are already well established sites focusing on these areas. ?We can?t sell used cars and find brides as well,? he says.

Sulekha has never paid for content. It started with three of Satya?s friends who loved to contribute articles. It has grown and grown, evolving into a huge interactive community sustained by thousands of members from 100 countries! It has 25 million pages of content, almost all of it contributed for free.

It features member-generated blogs, columns, photographs, reviews and more. It has a very large (Satya says the largest) component of travel and food pages.

Growth was been a bit flat for Sulekha during the first quarter of last year. But business has revived. Real estate and travel were affected, but other verticals held through. The company had cut down on administration costs, marketing costs and reduced pay hikes and incentives to employees by a third. It is now getting back to growing at 25-30% per quarter.

Although Satya does not want to reveal turnover figures, he says Sulekha makes good profits. He says it is a tough business, but Sulekha will continue to expand.

sushila.ravindranath@expressindia.com