EXECUTIVE PROFILE – PART 2 of 3
It’s been 29 years since NetSapiens co-founders David Wang and Anand Buch met and began working together at PCSI, an enterprise communications startup in San Diego. It would be a decade before they went out on their own and founded NetSapiens in 2002.
Prior to that, in the mid-90s, David and Anand were part of the PCSI transition team that spun out into a startup called Nuera Communications — an early pioneer in VoIP communications and the convergence of voice and data.
“Our best guy”
Anand held several key positions in multiple areas with the company. His assignments included writing code for digital signal processing, serving as director of engineering, and leading a product line. During his time at Nuera, the company grew from 30 to 300 employees.
From 1996 to 2000, Anand ran Nuera’s quality assurance team and enjoyed doing a lot of work with the tech support department, trouble-shooting and working closely with partners and end users.
Anand says, “I was given the opportunity to work closely with several different teams and learn how to take a product from inception all the way to market. I learned how to build a product and how to manage a team to meet corporate objectives.”
David recalls, “Anand was one of our brightest new grads, with good intelligence and also excellent attitude. At Nuera, when we found the need to re-energize our QA, we decided to task it to our best guy, and Anand was unanimously the choice. Indeed, he didn’t disappoint us by greatly increasing the performance of the reconstituted group, and brought new respect to this prior under-appreciated discipline.”
Knowing how his piece fits in the big picture
“I was always application oriented. I like knowing how my piece of the puzzle fits into the big picture,” said Anand. “I always enjoy the project side and seeing how things work in the ‘real world.’ And asking the ‘why’ questions.”
While at Nuera, his interest in the business side of the telecom industry led to Anand pursuing more education and in the late ‘90s he earned his MBA from San Diego State University. Anand got some real-world education when Nuera hit a rough patch. David Wang described what happened when the company tried to develop packet cable telephony.
“We spent three or four years demo-ing and testing. And eventually, we got a contract with AT&T’s cable division for three or four million dollars after spending $50 million. And then something happened at AT&T where they shut down the whole cable operation. And that was it.”
As a consequence, Nuera was forced to begin a series of layoffs. When the second round began, David volunteered to be let go. “I left Nuera because it was heading into a work environment and culture that I could not support,” said David. He felt it was time for a change and he really wanted to serve the SME (small and medium sized enterprise) market and work with second-tier carriers, because the “phone system is the lifeblood of a small business. When you’re a four or five person enterprise, you can’t afford a receptionist, so everyone one who answers the phone is a call agent.”
From experience, David knew that the second and third tier carriers were much more agile. “They don’t have a 10-year plan or a five-year plan. They have nothing. So they have to get things done in a year, because they don’t have that much capital. But also, they’re much more flexible to the end user.”
At the crossroads
It was at this point when David decided to start NetSapiens. (The name comes from a play on words and David’s idea that NetSapiens are wise beings on the “Net.” Anand thought about it more like “the fact that all homosapiens are evolving to become NetSapiens.”)
Unaware of David’s plans to start his own company, Anand felt he had come to the crossroads for his career as well as his personal life. Mamta and he wanted to start a family soon. He agreed with David’s assessment of how things were going at Nuera and was extremely frustrated about it and the lack of corporate transparency.
“I wanted to work on both the business side and product side. I didn’t understand why decisions were being made and no one took the time to explain to people, connect with people. I was responsible for a team but I felt I couldn’t be transparent. It felt like the blind leading the blind and things were out of my hands. I felt I was becoming a ‘Yes Man,’” remembers Anand.
So Anand began to seriously consider his options. First option, he could stay with Nuera and hang in until things got better. He could wait out the rough patch and continue to climb the corporate ladder. The second option he considered was changing careers and going into investment banking. And his third option was to leave Nuera and do something completely different.
Anand sought the counsel of colleagues he respected and trusted, and he began to work on his resume. Martha Dennis, who was David Wang’s boss at PCSI and later chairperson of NetSapiens’ board, advised Anand to “stick close to David.”
Invitation to be a founder
When Anand asked his former Nuera colleague to peruse and proof his resume, David said, “Why don’t you come somewhere where you don’t need a resume?” David proceeded to explain that he and a few former colleagues were “talking about getting something off the ground.”
It was now clear to Anand that David was eager to have him join his startup telecom business. Anand says he was honored to be invited by David to be one of four co-founders of NetSapiens in 2002. (The two others were Mike Fox and H-D Vo, both who were engineers that they had worked with previously. Both ended up leaving NetSapiens within three years of founding to pursue other options.)
Before he could accept David’s invitation to join the new company, Anand sought the counsel of his family. He expected his father Jogendra to recommend the conservative path of just keeping the job he had and to work his way up the corporate ladder. However, Anand was quite surprised when his father said he didn’t know anything about the telecom industry but that Anand should trust himself and have a conversation with his wife.
Mamta was equally supportive in echoing her father-in-law’s statement that Anand should trust himself. At the end of the day, she just wanted him to be happy. With the approval of his loved ones, Anand made the jump and signed on to the new enterprise. David warned it would be like a “long and expensive cruise” but both agree it turned out to be “the adventure of a lifetime.”
David explains why he thought Anand would be a good co-founder, “Anand had been working for me since he graduated from college, starting at PCSI, then Nuera. I was hoping to establish a new company to provide a place that could be nurturing, friendly, and fulfilling to work at. Through the mileage that we had already traveled together prior to NetSapiens, it was clear that Anand shared the same vision for a workplace, as well as our desire to contribute our skill and effort to serve those who have not been well served.”
Initial challenges
As the new venture would be self-funded, Anand and Mamta created an 18-month plan with the expectation that he wouldn’t have any income from the new business during that time. This plan would turn out to be too optimistic and Anand confesses that they had to live off borrowed money, credit cards, and the funds drained from their retirement accounts for a number of years.
Of course, funding to scale is always an initial challenge for startups, but Anand said another big challenge was starting from scratch and learning “real world” lessons that when he earned his MBA were just short, classroom exercises. It was different in real life. NetSapiens had advisors and friends of the company but Anand says, “We still had to do the work. Find the funds and build the business.”
Serving Small and Medium Sized Businesses
“Very early on, we realized that the second and third tier service providers were way under served, and at the same time they have a much closer relationship with end users, and hence, much better understanding of the need by small and medium sized enterprises. However, this market is very fragmented. Very few product companies put much effort into serving them, and almost no investors would be willing to place a bet on it. However, this is indeed where we felt we needed to serve, and at the same time not have to worry too much about competition,” said David.
Anand says he wanted to do something meaningful, something “real,” and have a good time doing it. He was passionate about helping to address the imbalance in “the telecom value chain” where the “biggest players had basically an oligoploy and small businesses and end users didn’t have choice.”
Key decisions
When asked what key decisions were made that led to NetSapiens success, David says, “Pursuing the much neglected second and third tier service providers market indeed proved to be a very un-travelled path, and hence, we ran into very few competitors. There are 4,000 or 5,000 second and third tier carriers in the US. But there’s not a single leader in this market we’re going after. Some say it’s hard to go after this fragmented market, but we believe that we can serve this fragmented market.”
“Furthermore, we also realized that the chance of any single company, including ours, in finding the ‘Killer Application’ was very unlikely (speaking from my background in probability and stochastic processes). Therefore, we explicitly designed our platform to be highly configurable, and encouraged our service provider customers to innovate on top of us. Hoping to ride their coattails, if some of them hit the jackpot!”
David continues, “When we first worked out our technical approach, we were quite inspired by the success of eToys, an eBay-type of online business, and decided to model our implementation more like an ecommerce platform than the legacy telecommunication platform. This decision significantly enabled the desire for our platform to be easily extendable by our customers, since many third-party developers understand ecommerce.”
Becoming CEO
Four years after the founding of NetSapiens, Anand became the CEO of NetSapiens Inc., where he leveraged his multidisciplinary education and experience in business and technology to guide the conception, realization, and delivery of new UCaaS solutions into the marketplace.
David explains the C-suite transition, “I made myself the CEO when the company was founded, since I was slightly better known and connected at that time. However, I’m really an engineer/builder in my soul, whereas Anand was much more a marketer and business type. By 2006, we had already got the fundamentals of our technology in place, and needed to start reaching out to customers and partners beyond those that I knew from the past. Hence, it made sense for me to stay in ‘factory,’ while Anand represented the company externally.”
Anand said he had to make a mental switch from seeing David as mentor to seeing him as a peer. “I looked up to David since he hired me right out of college. He was the catalyst that brought us together on this journey. He was the leader, but I saw when it was time to commercialize the NetSapiens solution that we built, someone needed to take charge. The company needed a reset.”
Anand says he knew for some time that a change needed to happen, but he was reticent to take action. “I saw what needed to be done, but I was stopping myself out of deference to David—but David wasn’t stopping me. I was stopping myself.” And so with little fanfare in 2006, Anand became the chief executive officer of NetSapiens and David became the chief technology officer.
Growing into the role
Anand soon realized that as CEO “it was all about closing meaningful deals. Otherwise, it’s over.” So when Anand took over the chief executive title it would take him some time to grow into the role but adversity doesn’t wait.
Three years later, Anand, David, and the rest of NetSapiens leadership team would be severely tested as they and many other businesses were forced to contend with the Great Recession. “I remember when Lehman Brothers went under in the fall of 2008, people were freaking out.”
In a March 2009 letter to stakeholders, Anand wrote that “NetSapiens is surviving and fortunately our challenges are on the financing side of the business and not the demand side…We have continued to grow our customer base…however, the financing environment around us has forced us to make some difficult and challenging decisions.”
Anand informed his stakeholders that when a number of pending financial deals fell through, they immediately changed the focus from raising more financial support to cutting costs. In addition to moving into a “slightly cheaper, slightly smaller” office, NetSapiens had layoffs and went from 10 salaried employees (including the principals) and two performance-based sales agents down to five salaried employees and three performanced-based sales agents.
Annus horribilis
These business challenges and existential threats to the company were all on top of personal challenges in 2008 when a house fire led to Anand, Mamta, and sons living out a Residence Inn for an extended period. Also, in that same time frame, Anand’s parents were in a serious car accident in Chicago, where Anand’s mother Jyoti nearly lost her life with broken ribs and a stroke.
Anand says one of his skills is his ability to “galvanize groups” and he reminded his core team members that as long as they stuck together, they’d be all right. He, David, and Jim Murphy (currently NetSapiens’ executive vice president who at the time was an investor and company consultant) put more personal money (some raised from home equity loans) into the company “to make payroll.”
Declare bankruptcy?
“Some advisors were telling me that I needed to be more draconian and declare bankruptcy to protect the business and that ‘people would understand.’ But we didn’t go down that path. For me, it was a matter of principle. I’d do the same again. What I’m most satisfied and proud about in this journey is the people who we owed money were kept on the books and that we converted to equity were all taken care of eventually.”
It was a rough road to hoe. Anand recalls, “I had to have some tough calls with our top clients and prepare them for less responsiveness because we had to reduce our support staff down to one person.”
Anand believes what saved the company after all the austerity moves, was being able to double its client accounts in 2009. “Service providers and end users wanted our solutions and services because we had a reputation for building a good product. Other folks who were instrumental in our journey post-2008 were Chris Aaker and Dave Privee,” said Anand.
David Privee was in charge of sales at NetSapiens. Over the years, his role has evolved and currently his title is Chief Client Advocate. From his perspective, Anand grew substantially in the role of NetSapiens CEO, especially in the Sales arena.
“Anand started NetSapiens as an engineer to design and build the best product in the market. He was comfortable in that area. He had managed an engineering team in his previous job. At NetSapiens, once product development was completed and ready for the market, he had to build and learn the other parts of a company to succeed as CEO, and that is where he really grew.”
Privee continues, “Anand had engineering and product development down cold. Then he developed the deep knowledge of Finance, Marketing, and Sales areas to move the company in a forward direction. Anand grew the most in the sales area (as engineer to salesperson) but he learned that all are equally important and are dependent on each other for a successful company.”
The Second Decade
Now, as it completes its second decade of existence, NetSapiens has grown and reached the point where being acquired by and merging with a publicly traded company like Crexendo was the next logical step in the evolution of the company.
In a press announcement, Anand is quoted as saying, “This is a very exciting day for the entire NetSapiens team. We have worked tirelessly to build NetSapiens to be the fastest growing UCaaS platform in the business. We knew that in order to keep growing market share we needed to find a partner who could help accelerate our growth. Crexendo proved to be the perfect partner, they share our passion for excellence…Our teams will work closely together to continue to improve the combined company, to provide excellent service to all of our customers and to increase shareholder value.”
David Wang offers some perspective on how he and Anand were able to survive and thrive with NetSapiens the past two decades, “Common saying that it was hard to suffer together, but even harder to share wealth. However, as partners, we went through many ups and downs together, always trusting each other and never second-guessed one another.”
David continues, “We had many constructive debates, which might have sounded very contentious to bystanders, but we were actually enjoying ourselves. These frank discussions helped us clarify our thoughts, to arise at better decisions from our different points of view. On many occasions, people asked us questions individually, and were amazed how consistent we were. It almost seems that we are telepathic. In reality, it was because we had good agreement on many basic principles in both the technology and business of the company.”
Two million end users
Recently, the NetSapiens platform surpassed the two million user milestone. In a Crexendo company press release, Anand is quoted as saying, “This is a very exciting milestone for the entire team. We worked hard as an independent company to be the fastest growing UCaaS platform in the business and continue now as part of Crexendo to make sure that we provide the best UCaaS platform in the business…This is just the start of many more major milestones.”
In Part 1 of Anand Buch’s profile, he discusses his life and career before co-founding NetSapiens.
In Part 3 of Anand Buch’s profile, he offers leadership lessons and his opinion on the UC industry and its future.
Read NetSapiens co-founder David Wang’s profile “The Adventure of a Lifetime.”
Meet the Team profiles offer insights into the backgrounds, experiences, and lives of NetSapiens’ founders and company leaders. We are always focused on the NetSapiens mission, which is to become the best B2B provider of unified communications, video conferencing and collaboration, and contact center solutions for service providers.
