The genesis of the idea
A keen interest in bitcoin/blockchain made Neil Martis, co-founder and CEO, LegitDoc, experiment with the technology towards the end of his engineering degree in the National Institute of Technology (NIT), Karnataka. Once he discovered Ethereum, an open-source blockchain, he was convinced that the technology was going to be one of the most impactful game-changers in the coming years. “I came across an interesting project called ‘Blockcerts: an open standard to issue tamper-proof educational degrees using blockchain’, built by engineers at the Massachussets Institute of Technology (MIT), and this was my moment of epiphany,” says Neil.
He elaborates that the project opened his eyes to the possibility of blockchain emerging as a novel solution to a long-standing problem that is widespread not just to India, but in other parts of the world too. The falsification and forgery of documents in the areas of education, governance, healthcare, property records, banking and financial transactions, continues to be an alarming problem that is prevalent across global societies. However, Neil understood that while the Blockcerts project was more sophisticated in its scope and implementation, it would be challenging to adapt it for the Indian market that required a less complex and more economical solution to the problem.
Building a company
Neil enlisted the help of his uncle Francis Serrao, a veteran from Qualcomm, USA, and a friend Shesha Vishnu Prasad, an IT expert, to flesh out the concept of the startup. Further brainstorming led to the birth of LegitDoc in 2018. In Neil’s words, LegitDoc is a “patent-pending, blockchain- based, decentralised application that can be leveraged by document issuers (eg: banks, insurance companies, educational institutions, government departments, hospitals, medical labs, among others) to issue tamper-proof digital documents to its stakeholders. Such documents can be remotely verified from any part of the world, within a matter of seconds.”
“The world is going through a tremendous phase of digitisation that has led to a push towards digitisation of documents, which have traditionally been infested with forgeries due to the manual nature of their end-to-end processes,” says Neil.
He explains that blockchain seemed an apt technology to find a solution to the problem of forged documents, due to its powerful application in decentralised registry. “Blockchain-based digital document registry is the most robust and scalable way to stop the menace of forgeries, even by countries that lack the necessary resources to adapt traditional digital solutions to combat the problem,” says Neil.
Even though digitisation is gaining popularity, doing so using the traditional centralised digital solutions has its own challenges. Some of the challenges include threats to data security and privacy, and high cost of setting up and maintaining a dedicated centralized infrastructure. Blockchain technology, along with associated cryptographic techniques, addresses these challenges in the most robust way.
LegitDoc focuses on ensuring the legitimacy of documents in the areas of governance, education, banking and insurance and healthcare as such documents are at maximum risk of getting forged.
The business model and its benefits
LegitDoc uses a SaaS-based platform that leverages a combination of blockchain, cryptographic techniques and its patent-pending technology to deliver tamper-proof digital documents, which are verifiable within a matter of seconds. The company charges per document that is either issued or verified, as per individual requirements.
According to the founding team, blockchain enables unparalleled security to clients and the embedded cryptography ensures the privacy of the
documents. “Our patent-pending technology compresses the data that goes onto the blockchain, enabling us to achieve greater scalability and cost effectiveness,” says Neil.
Funding and customer acquisition
LegitDoc is currently a bootstrapped startup and the founders believe in an organic, revenue-driven growth for the company, rather than seeking outside funding from venture capitalists. However, the company is the recipient of an equity-free grant of Rs. 30 lakh from Elevate-2019, an initiative of the Department of Information Technology and Biotechnology, Government of Karnataka.
The startup employs the following methods to acquire customers:
- Direct sales through the in-house sales team.
- Channel partnership with existing software solution providers in the industry.
- Partnering with incubators and accelerators.
- Gaining visibility in the market by participating and winning national level startup competitions and awards.
The startup currently counts two Indian state governments and three corporates as its clients. It is expecting to onboard more corporates even as it expands its global footprint that include India, Kenya and Oman.
Overcoming the challenges
Neil recounts a unique challenge that the company faced during the early development phase of its product. Prospective clients were initially reluctant to try out the product as blockchain was still a novel concept in the market and had limited adoption in India. The company had to overcome the rigid mindset of potential customers as they were wary of being the first-time adopters of the technology. “This was the chicken and egg problem we faced in the early days, where none of our clients wanted to be the first adopter!” says Neil.
The company took an unconventional approach to overcoming this impediment. The founders realised that LegitDoc had to create a real and visible impact in the marketplace to bring about a mindset shift among potential customers to embrace a revolutionary technology. Towards this objective, the company started participating in government-led national competitions as only the government was a keen adopter of blockchain in early 2019. The founders opted for this route also because they were not confident of winning tenders at the time.
Fortunately, the strategic approach worked in the startup’s favour as LegitDoc won several of these competitions, such as Government Mentorship Program (Government of Telangana), Maharashtra Startup Week Challenge, Elevate-2019, The Ten Minute Million (IIT-Bombay) and the ASSOCHAM Startup Launchpad, among others. Laurels won at these forums earned the startup prominence, trust and even a few work orders in the market.
T-Hub as a powerful enabler
LegitDoc is a part of the fourth cohort of T-Hub’s flagship Lab32 program. The company has opted for the program’s marketing track to establish itself further in the industry.
“T-hub is a one-of-a-kind startup incubator in the country that’s behind the success of numerous startups,” says Neil. “The unique network of government departments, corporates and mentors makes it a great ecosystem for startups. It has launched successful startups even in the field of blockchain such as Chitmonks. Hence, we too wanted to be the part of the T-Hub ecosystem. Being a startup based out of Bengaluru, we saw Lab32 to be the perfect program which could help us be a part of T-Hub without requiring us to move physically to its location in Hyderabad.”
He adds that since the startup is still only into its fourth month of association with T-Hub, it’s too early to arrive at a ROI that could be solely attributed to T-Hub. However, he acknowledges that the Lab32 program has facilitated in other tangible benefits, such as the below:
- Standardisation of LegitDoc’s marketing strategy by bringing in the expertise of an external marketing consultant. Ten weeks of closely working with the consultant has enhanced the company’s brand equity, provided effective marketing collaterals and a clear marketing roadmap for the next 12 months. LegitDoc is prepared to devise and execute a sound marketing strategy as a result of this collaboration.
- LegitDoc also got an opportunity to pitch its solution directly to the Government of Telangana for procurement, as a part of T-Hub’s Government-Startup Connect Program. As a result, School Education Department of Telangana has shown an interest to pilot LegitDoc in the state.
- The startup has got access to several networking opportunities with peers and has received potential business leads.
- Mentoring sessions on various marketing tools and concepts by external experts.
- Continuous monitoring of the startup’s progress by in-house mentors at T-Hub.
- Strong connect with T-Hub’s vast network of peers, mentors and industry experts
Planning the future growth strategy
According to Neil, since the startup operates in the B2B space and leverages a niche technology, it hasn’t felt compelled to invest heavily in marketing. The company is confident that its client base will result in the generation of recurring revenues in the long-term. “Currently, we need to spend our energies in finding the right channel partners, tap into the right networks and invest in our in-house sales team,” explains Neil.
The company has ambitious plans for expansion. “Since our product is tailor-made for underdeveloped and developing countries to leapfrog to digitisation, we want to be the go-to standard for tamper-proof digital documents in all these markets,” says Neil. “We have already made a good start in Kenya and are looking to replicate this success across other African nations as well. We are also looking to extend our customer base in GCC nations (Gulf Cooperation Council), in the years to come. In the next five years, we hope to establish ourselves as a behemoth in ten different countries in the field of blockchain-enabled education, financial and healthcare documents.”
The startup recently received a work order from the Government of Maharashtra to issue tamper-proof digital diplomas for the Maharashtra State Board of Skill Development Examination[MSBSDE]. The project is in its final stages and will be open to the public by the end of February, 2020. Neil claims that once the project goes live, it will be the largest blockchain implementation in the world for educational certificates, with nearly 1 million certificates belonging to a total of 8 academic years embedded into the blockchain platform.
Challenges amid the pandemic
According to the founding team, the startup’s projects that had seen good initial momentum in early 2020, slowed down considerably during the COVID-19 pandemic. The company had to either pause or slow down execution of its work orders. “Moreover, clients who were on our waitlist signups deferred onboarding with us due to the prevailing conditions,” says Neil. “This dampened our revenue expectations for FY 2020-21. However, we used this time to refine our product and marketing strategy.”
Lessons in entrepreneurship
Neil reflects on the good, bad and ugly of what has made his entrepreneurial journey worthwhile so far:
Good: If you iterate enough and be patient with the results, the market will reward you.
Bad: In your startup journey, you’ll meet a ton of people who’ll promise you wonderful things, but 99 percent of it will be noise. Work with them without having high expectations.
“Markets and clients are the best judges for any product that you bring out,” sums up Neil. “No matter how technically sound your product is, its alignment with the market expectation is what will determine the startup’s success. Whenever you hit a roadblock due to the misalignment between your product and market expectations, iterate on repackaging it until it’s in line with what the market wants. This lesson has helped me transform our product from ‘market rejection’ to ‘market acceptance’.”
Now, that is golden advice for entrepreneurs everywhere!
Company’s turnover to date: Rs. 55 lakhs
Y-o-Y comparative analysis of the sales numbers
|2018-19 [initial phase]
Annual overhead costs: Rs.10 lakhs (approx.) for 2019-20 & 2020-21
Projected five-year revenue forecast:
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