Entrepreneurship Assignment

KAILASH KATKAR

Submitted to:

Dr. Amit Kumar

Submitted by:

Aashna Patodia (D-1)

Ravi Kumar (D-41)

Roopika Gupta (D-45)

Symbiosis Institute of Management Studies, Pune

(Constituent of Symbiosis International University)

Jan 2017
 Introduction

Kailash katkar is the man behind Quick Heal which is now a 200 cr plus antivirus company.
Quickheal antivrus is used in computers and mobiles to protect them from virus, Trojans and
other malware programs. Quick heal technologies is now a 23 years old company founded in
India. It also offers security on cloud and provides solution using machine learning. It has
different products for computer and mobiles like Quick Heal Total Security, PCTuner 3.0,
Internet Security,Mobile Security, Fonetastic Pro, Quick Heal Gadget Securance, etc. Quick Heal
is the first company to venture into IT security solutions with its high end research and
development of security solution on different platforms. The IT security empire now works from
more than 60 countries like Dubai, Japan, USA, etc. Quick Heal given tough competition to
foreign security companies like Symantec and MacAfee.

About the Entrepreneur

Kailash was born in a Maharashtrian family in a small village in Maharashtra. His childhood was
spent in Pune. His father worked as a machine setter in Philips. Due to family circumstances he
had to drop out after SSC. But soon he had to do a job in radio station and repair shop to give
financial help to his family. He grew interest in technical side and started repairing different
gadgets. He underwent 2 months training in Mumbai and later joined the owner to become an
expert in calculator and radio repair.

In 1990, he decided to start his own calculator repair shop and with Rs.15000 initial fund he set
up his calculator repair shop in a 100 sq ft office. The company has an income of Rs.45000 in the
first year but it did not satisfy Kailash. He started attending courses to learn computers. After an
year he transformed his calculator repair shop to CAT Computer services.

Even after this he faced many difficulties since he didnt have the domain expertise and
qualification. But he didnt lose hope and kept on targeting customers aggressively. It was this
perseverance that he got 2 families who agreed to give Kailash a contact of maintaining their
home pc for Rs. 2000. Later he was able to acquire few more customers. New India Insurance
became his first corporate client which gave him the work of computer maintenance. The
company now had a turnover of Rs 1 lakh

Trends

Kailash was growing constantly and smoothly but soon realized the scope of computers and
people were towards computers. He realized the need of computer skill and upgraded his skills.
This new skill gave him annual maintenance contracts to maintain computers.

With the advancement of technology and computer programs, there came a concept of malware
programs called viruses which could damage your computer, network, etc. These viruses could
travel from different machines across network and had no boundaries. Hackers would attack the
computer and gain user data and other financial data. They even attack corporate computers and
networks to gain access to user data, account, etc. and exploit them.

Kailash Katkar was aware of these issues and had one solution to all these issues i.e. reformatting
the computer and installing the OS once again. But he realized that prevention is better than cure
and started working towards it.

Opportunity

His luck was in favor and his brother Sanjay Katkar got admission in an engineering college in
Pune where he soon started writing computer programs. Kailash insisted Sanjay to create a basic
antivirus software which would help in CAT computer services.

Market and Idea

Quick Heal Technologies Ltd. was established in 1993 and was formerly known as CAT
computer services ltd. It was started as a computer service center and then later moved to
providing IT security solutions provider. Kailash Khattar, the founder of Quick Heal worked in a
calculator repair shop in the last 1980s. Soon after which he transformed it into electrical device
repair station in 1993. However Kailash lacked the industry experience to generate business
during the time when market was becoming more computer savvy and many organizations were
introducing computers in their workspace. The organizations who bought computers were
looking for maintenance services for which very few vendors were available in the nineties.
Kailash saw the opportunity to upscale the business and enrolled himself for couple more
professional courses. The business idea was to provide maintenance services to organizations for
an annual fee.

The nineties was also the time when computer viruses became popular and the threat of data loss,
financial loss or system failure started lurking the organizations. Soon the need for anti-virus
software programs was felt which were very expensive at that time, Kailash used this
opportunity to develop a basic anti-virus software program for DOS in 1994 and named it Quick
Heal. It was cheaper than the alternatives in the market and gained popularity. Quick Heal
became popular by helping clients get computer security solutions at cheap prices. Quick Heal
was providing quality security solutions for a cheap price of Rs.700.

Quick Heal began capitalizing on the situation soon after two deadly viruses came One Half
and Natash. These two viruses could be decrypted only by Quick Heal and no other global anti-
virus company could decrypt it which provided an edge. This gave thrice the amount of turnover
than previous year, amounting to Rs. 12.19 lakhs.

Initial Struggles

Kailash struggled with regular funding issues since the business was not well received by the
financial institutions as the marketing for the business plan was poor. They failed to grasp the
concept and did not want to take on so much risk in a new business little known to them.

In 1999 Kailash even considered shutting the company down as the operating expenses of
salaries of employees werent met. However with couple of strategic moves the business was
revived again. The cash crunch affected the product development of the company which caused
serious concerns. The banks werent willing to lend out money to the company as the business
idea did not seem strong to them.
 FUNDING

Quick heal Technologies raised 133.90 Crs from anchor investors before their IPO. Sequoia
Capital invested 60 cr in quick heal technologies becoming 10% owner of the company but after
the IPO it shall bring it down to 6% making them the highest anchor investor. There were many
more like BNP Paribas, Reliance MF and Birla sun life being their domestic anchor investors.
These anchor investors were offered 41.70 lakh equity shares with a price band of Rs 320 -321.
The company opened their IPO on 8th February 2016 and closed it on 10th February 2016 from
which they raised 250 Crores by selling a fresh set of equity shares at the same rate upper band
being Rs 321. The money raised from the two were used for different purposes ie the money
given by the anchor investors will be used to purchase, develop and renovate their office
premises in Kolkata, Pune and New Delhi whereas the 250 Crs would be used by the company
for various activities like advertising, sales promotion and other capital expenditures.

GROWTH

The company has and is said to be in a segment with extremely high growth potential, it has
done exceedingly well for itself in the past few years and the results can be seen in the recently
sent out IPO where they managed to make 250 Crs from earning just Rs 400 per month when this
company was started. So we can see that the company has grown by leaps and bounds from its
start till today.

The companys revenue has seen a compounded annual growth rate of 16.9% from the year 2012
2015 which is a shocking amount of 287 Crs. Although the company revenue has increased
leaps and bounds the profit of the company has remained stagnant for a large number of years
due to unaccounted expenses like new product development and other advertising activities.

Quick Heal Technologies Limited Reports 26% Revenue Growth and 43% EBIDTA Growth in
Q4 FY16. The board decided to give a dividend of Rs 2.50/ equity share issused.
PERSONAL CHARACTERISTICS OF AN ENTREPRENEUR:

Hard work
Vision
Good judgement calls
Ability to spot opportunities
Keen interest in the topic in front of you
Have a business mind
Motivation and inspiration

COMPETITOR ANALYSIS
 Bargaining power of suppliers: in terms of the people who make the software can be
hired by other companies as well and they can copy the same software so then quick heal
can lose their market share.
Bargaining power of buyers: as buyers you might not like the offer or the technology
provided by this company as it is not working for youll and still malvare is being found
in your systems.
Threat of new entrants: there are various other new software providers that can come in
the market and take over quick heal as a company like Kaspersky Internet Security,
Norton, McAfee and Ang Antivirus.
Threat of substitute products or services: nowadays every technology is being upped by
another technology so is the antivirus system with technologies like FireEye Malware
Protection System, Zscaler User Security Platform, TaaSera Malware Behavior Detection
System and many more.

References

www.yosuccess.com/success-stories/kailash-katkar-quick-heal
www.business-standard.com/Markets/IPOs/News
Turnitin Report