How Alexander Sysoev tamed Goliath (part 1)
This month Vladislav Moiseev’s book “Business from nothing, or How to build an Internet company and not go crazy”is published. Forbes publishes a fragment from the book dedicated to Alexander Sysoev, the founder of 2gis offline map service
Vladislav Moiseev’s book “Business from nothing, or How to build an Internet company and not go crazy” is a joint project of the Laboratory “Once”, publishing house “Alpina publisher” and the Fund for the development of Internet initiatives. The book is devoted to the history of seven major Russian IT-entrepreneurs, their mistakes and failures, successes and breakthroughs. The hero of this Chapter — Alexander Sysoev, occupying the 34th place in the ranking of Russian Internet millionaires according to Forbes with a total asset value of $142 million. Despite the presence of such competitors, as “Yandex”, Google and Maps.me, Sysoeva 2GIS company is surely among the ten largest IT companies of the country. Its head office is located in Novosibirsk, where Sysoev was born. The total number of employees — 4500 people. All 2gis versions are free for users. The main source of income is the sale of advertising spaces on the map and in the directory.
Most entrepreneurs with the word “competition” begins heartburn and nervous TIC. Sysoev, on the contrary, considers the main obstacle in the development of his business the fact that he had no competitors for a long time at all. This taught him two things: to love crises that kick in the ass in time, and to appreciate rivals whose mistakes can be learned in a timely manner. Today 2GIS a huge range of possibilities to die at any moment. In a world where giants like Yandex, Google and Apple have captured all of the mobile device, Sysoev with their offline maps looks clear that a straw goes to war against herds of elephants. Most observers sincerely do not understand why 2GIS is still alive and shows double-digit growth rates every year. Why wasn’t she killed by the IT Goliaths who had long since taken over the geoservice market? To this question Sysoev answers: “Because we are not IT”.
Will you stop?
I believe that the main engine of an entrepreneur is personal interest. Money at some point ceases to play a key role. Yes, the idea is stale, it has been expressed by many, but few believe in it really. A stupid joke about the fact that it is not money that matters, but only big money — it is very firmly in the minds and kills many good startups and even established companies. First, because it knocks down the guidelines and prevents you from doing the right thing. And secondly, because it raises the main obstacle to any entrepreneur — satiety. To accommodate a truly great opportunity, you need to be able to be always hungry. Forever insatiable and can only be the Creator. If you know how to get high and drive from the fact that you invest your efforts and create something, then you will have the desire and opportunity to build on. If you are a consumer by nature, you will very soon exhaust your own personality — you will reach a certain level, when it will be enough.
We had to be hungry for a long time and it must have become a habit.
In the 80’s, many of the world’s startups started in garages, and we had an attic. The real attic in the building of NETI (now it is Novosibirsk state technical University), where I studied and then worked. There were computers in the attic, and when we were students, we would come up with something. There, in the attic, and the idea of 2GIS, which, in fact, still alive. The idea was simple and naive at the time: we believed that someday we could make good money on programming. Reality insisted on proving us the opposite, but apparently we were not sufficiently receptive to reality.
After graduating, I stayed to work at the Department of automation. Even then we had in the University there were contractual work — a prototype of commercial orders. Different organizations came to us with their technical tasks, we solved them and earned money. I liked it and, perhaps, it would have lasted for a long time, but then the Soviet Union decided to collapse, the country began a complete reset and our modest scientific and commercial project faced the need to live an independent life. So the firm “technograd Plus”was born.
Unlike our peers in Silicon valley, we did not have access to venture capital. We didn’t even know that word. In fact, we have become our own venture investors. How? Very simply.
My wife was not bad commercially savvy — certainly better than me. She took a Shuttle to Poland, estimated that imported goods can make good money, and said: let’s go into Commerce. And I was constantly flying in the Shuttle-landlord Poland. From Novosibirsk to Moscow, then on the train to Warsaw, there loaded goods and back: train — plane – flea market. At 6 am I flew to Novosibirsk, at 7 was already on the market, by 12 I sold everything, at 14 — to the attic to my programmers.
Part of the money that my wife and I earned on the Shuttle trade, I brazenly took from the family and invested in their three times useless experiments. At home it sometimes caused a strong reaction. Several times the edge of the question arose about where to go. Because simple Commerce began to develop normally, money — here they are, row if not a shovel, then certainly a scoop. A little later, my wife and I began to sell apartments and also quite successfully. We had to decide: do normal a large real estate Agency, or to spit? Spat. To be engaged in Commerce or not to be engaged? Yes, study. Because, first, you need something to live by, and, secondly, to feed the voracious attic. But I’ve always had a deep conviction that this attic thing would eventually turn into something more. How? I didn’t know the answer to that. I just loved the direction. I was sure that we could make an interesting product and make money on it. And he was ready to work hard for a long time to test his dream for lice. This is it — a personal interest that is stronger than money.
Proof of non-public
Soon the dream began to come true little by little. In those days began a massive demand for digitization of everything. I was professionally engaged in geographic information systems, and the city telephone company came to me. It has already managed to corporatize after the collapse of the USSR, there generally worked quite progressive guys. These telephone operators became the main customers of our attic startup. They needed a General digital map of the city’s telephone network, tied to the terrain. While it could be kept in paper form: hundreds of fragments, drawn with ink on cardboard. And it was necessary to drive the whole thing into the computer. At first, we just digitized all these pieces. And then we decided to go further – we realized that we can put these individual puzzles in a single digital plan of the city. At that time, there was no available material that could be used for such work in our city. Had to come up with technology that is now enjoyed by all.
To do this, we just took and vectorized a space image. Today it sounds quite ordinary, but twenty years ago it seemed something incredible. Although the Soviet Union took satellite images of the whole world, including its territory, it never occurred to anyone that these images could be useful not only for the war, but also in the national economy. As a result, the Soviet Union disappeared, and satellite imagery remained. We went to Moscow, found the organization in which it was stored, bought space images, came up with the technology and built a digital plan. And immediately ran into the first serious obstacle.
The Soviet Union collapsed, but the phantom of the habits of all the secrets left. At that time, small private organizations were not engaged in anything similar — plans and maps were under the jurisdiction of state monopolists. Just openly publish the city plan, based on the satellite image, was forbidden. We had to get official permission. It was a separate battle and a great story. We went to all sorts of commissions and huge offices for a year. Then there was still alive Gosgeonadzor, who looked at us like a soldier on a louse: some small office — 5-10 people — climbs into the historical monopoly. We were there for a long time carried muzzle on the table, but in the end we proved that we are not camels.
I remember Fedor Nikiforovich Gavrilova, the late head of the Inspectorate, which considered the case. For some reason he sympathized with us. Grandfather over 70, dry and strong, he had the office with the long Soviet Desk, above it a portrait of Dzerzhinsky, all imbued with the spirit of the past five years. Nevertheless, on its whistle huge commissions gathered, sat down at this table and discussed something. To it in eyes spoke directly at us: “Fedor Nikiforovich, you what competitors let?”And he answered: “And you give me the legitimate tool not to let — I won’t let them. Otherwise, the Antimonopoly Committee will come to me and ask why we are preventing healthy competition. I need this?»
At one of such meetings we show everything-we tell, and Gavrilov also speaks: “Well, it is good. Now we fly to Moscow on Board of Roskartografiya, after 10 days, return, come.”
I come in 10 days. Knock!knock!
— Fedor Nikiforovich, can I see You?
How are we?
— What is it? Why is it bad?
— You made me retire.
Wow! How come?
— Just like that. Years me, of course, a lot, and there in the stands-that all was well, but in the lobby I said, “This is for you because you can’t stop the competitors.”
— What are we gonna do now?
He thought for about ten seconds, opened the Desk, got out the authorizing act. Naturally, we still have a copy. So he thought, took the pen and signed.
— I am a pensioner tomorrow, and today I am the chief of inspection. On, go to work.
So we were given a start in life.