It offered a variety of digital services before moving into payments in 2014, just as millions of urban Indians began shopping online. Two years later, India’s banks created the Unified Payments Interface, a tech umbrella to help banks and fintech startups create services quickly, and the government eliminated high-value currency notes, turbocharging demand for Paytm’s services. Sharma, a self-described hippie who loves to sprinkle U2 and Pink Floyd lyrics into his conversation, now has backers including Alibaba’s Jack Ma, SoftBank’s Masayoshi Son, and Berkshire Hathaway’s Warren Buffett.
Paytm is the market leader in India, where KPMG sees digital payments growing at the fastest rate of any country, with transaction value rising at an estimated annual rate of 20.2% from 2019 to 2023. But competition is heating up as Google, Walmart, and Facebook jump into India, wielding cashback offers to lure customers. Meanwhile, the government has proposed scrapping fees on digital payments, Paytm’s core product. In an interview in Delhi, Sharma described his career and how Paytm is adapting to India’s changing market, cutting annual expenses 45% and preparing to raise new funds to accelerate the next phase of growth in smaller cities.
SARITHA RAI: What led you to digital payments and e-commerce?
VIJAY SHEKHAR SHARMA: I grew up in a small town called Aligarh where I studied in a very basic Hindi medium school [where Hindi is the medium of instruction]. I didn’t have fancy schooling. I was lucky to get into engineering college in Delhi at the age of 15. I taught myself English by memorizing rock songs and simultaneously reading translated textbooks in English and Hindi. When I graduated, I was the youngest teenage engineer out of the University of Delhi. As the Pink Floyd song [Breathe] goes,
Run, rabbit run.
Dig that hole, forget the sun,
And when at last the work is done
Don’t sit down it’s time to dig another one.
For long you live and high you fly
But only if you ride the tide
And balanced on the biggest wave
You race towards an early grave.â€‹
My early heroes were internet entrepreneurs Jerry Yang and Mark Andreessen. I started One97 Communications in 2000 and began by selling content to users through telecom operators. By 2010 the smartphone became the distribution channel. Payment became our thing, and destiny was in our hands. In 2014 we launched our licensed wallet product. By 2015, Ant Financial had invested in us, then Alibaba and then SoftBank.
A whole generation of internet entrepreneurs in India have small-town roots and hunger to build something significant and successful. My father was a schoolteacher. I had four siblings; there was no money to go around. I had to find ways to make money through weekend consulting jobs to set up computer networks for small businesses. At engineering college, I naively asked around [to find out] what the best-paying job is. Somebody said CEO. I didn’t even realize the person was being sarcastic. I knew the only way to get to be CEO was to build my own company. Looking back, I’ve never had a business card which said CEO. When I set up One97 Communications, my business card stated my title as EO. My engineering school buddy and one of my first employees, Harinder Takhar, also had the same title. We were both EOs.
I couldn’t get to Stanford or Silicon Valley. Somewhere there was the urge that I should do something worthwhile, but I would have to do it in the Silicon Alley called Delhi. I wanted to build a great company; I wanted to attract the best talent. The internet age was calling. Paytm began offering people searches and went from there into business services, payments, commerce, gaming, content, financial services, and banking.
SR: Are you satisfied with what you’ve built so far?
VSS: Many entrepreneurs are called “overnight success.” I say, “Yeah, my overnight was 19 years long.” We started in the dial-up internet era, where we ran up huge phone bills. We now carry the internet in our pockets. How far we have come! The last 20 years have been the most significant for India. It is an unprecedented kind of change the world hasn’t seen, not even in the U.S. or China. Nowhere else have such a large number of users come online in such a short period of time.
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