SINGAPORE: Co-founder and director of Singapore’s first mobile virtual network operator Circles.Life, Rameez Ansar, has been described as a maverick for introducing mobile data plans that a year ago, would have been unimaginable. The virtual telco does not operate any physical assets, and leases its infrastructure from M1, all in the name of keeping prices low for customers.
Targeting a younger, tech-savvy demographic, Circles.Life claims to offer the best no-contract mobile plan, with a S$20 20GB plan making recent headlines. On a larger scale, the company also says it is on track to achieving its market share target of 4-6 per cent in a few years, and intends to expand overseas to markets such as Hong Kong and Indonesia.
But nearly one year after its launch in May 2016, the picture isn’t rosy. The delivery of SIM cards, botched number porting, and customer service responsiveness are just some issues it has had to deal with.
Rameez went On the Record with Bharati Jagdish about what it has been like so far running his own business, disruptive business models and the recent customer complaints.
Bharati Jagdish: In media interviews, you talk about serving customers often, but recently there have been a lot of complaints about your services. There were complaints about the delivery of SIM cards, there were complaints about botched number porting, customer service responsiveness issues. What's going on? Why so many issues?
Rameez Ansar: If one customer, five customers, or ten customers have a problem, it's a problem for us. To put this in context, the delivery of the SIM cards is like the delivery of your groceries. If you miss it or not, this is going to cause you a huge amount of stress. We understand that.
The other thing is that Facebook is our customer service channel. What you see is real customers talking about real customer issues, so we actually opened up a channel up for customers to talk to us directly, that's how we make sure we address every single one of them. So, yes, there are issues.
When we launched 20/20 (20GB for S$20 data plan), we had been overwhelmed and humbled frankly, with the kind of reaction we got. We are probably the fastest-growing telco in Singapore right now. That comes with its own set of challenges, especially if we are trying to always serve every single one of the customers.
But if you go look at the Facebook page today, you would see that every single one of those queries has been resolved satisfactorily, or at least satisfactorily to the customer, which is the most important thing.
Bharati: But why were there so many problems to begin with? Are you saying that you weren't prepared to deal with that sort of demand, (which) is why there were service lapses?
Rameez: I think it is a combination. In the telco process, there are many things: there is the issue of how you get on the network, whether you have the network capacity, how you deliver the SIM cards and we use partners to deliver the SIM cards. Then there is porting and porting depends on the other telcos working with us, or middle parties working with us. So we need to work not just with ourselves, we need to work with a group of 12 entities to make sure the experience works perfectly. That is true for other telcos as well when porting happens.
Bharati: But you can’t expect a customer to consider all of this. For them, it’s simple - I applied for your service and you failed me. If there’s an issue with the middlemen that you work with, perhaps you need to find new people to work with. Also as a person who is not your customer yet, seeing those complaints makes me think: I never want to be your customer. So the damage is done.
Rameez: In some ways. But the other way to think about it is, today, tens of thousands of customers are still coming to the network. What that means is that there is an inherent understanding of the problem, but also there is an inherent understanding of the value proposition and the fact that there must be a majority of the people; in our case we know the numbers, like 95 per cent plus, for whom it was the most seamless process you have ever seen.
Bharati: You say you’ve been achieving industry standard customer service ratings of “well above” 90 per cent, while averages for the telco industry hovers between 60 per cent and 70 per cent. You’ll understand if some customers don’t believe you.
Rameez: I know how frustrating it can be. We really have been working on it.
Bharati: You have to fix the messes.
Rameez: Yes, continuously, so since that case, we introduced self-service. So once you order, you can go online and keep track of your order exactly, and you can reschedule the delivery, say if you don't know that you are going to be there on a particular day. We also introduced self-collection options for customers because that is in demand as well. You can reschedule porting or you can do it yourself. This, we introduced as a reaction to all the problems.
We have a 24/7 customer service hotline and online chat function. There are certain types of chats available. For critical inquiries it's available all the time. So if you wanted to reschedule something and the delivery is today, we will address it right away. If it is a generic non-critical issue, we will address it within 3 working days. That is the model that most companies in the telco space also follow.
Bharati: People on your FB page have been saying that the hotline is not responsive. PMs are sometimes not dealt with in a timely manner.
Rameez: It can be frustrating, but we deal with each and every query or issue on the FB platform. And we will continue working on the responsiveness.
Bharati: What are you planning to do to fix the PR fallout that has occurred?
Rameez: We are reaching out to people to help them understand that there are two things. First is, all the measures that we talked about in terms of introducing self-collection, etc. Then there is the whole technology we pushed out to the users and our service. That's the beauty of the new world. I think our biggest ambassadors are our customers. Today, 30-40 per cent of our users come from referrals. So there is a bit of a proof point there. Yes, we’ve had some issues, but not all our customers had them. Some did and we acknowledge that and of course we need to keep improving.
If you set yourself a mission that you are going to improve customer service and you spend all your time talking about it, and you have a drop of five customers, that's not good and we realise that and it kept me up at night. We are a regulated entity under IMDA and we have to abide by the same level of quality of service. We need to prove we can deliver that quality of service.
A NEW BUSINESS MODEL IN THE TELCO SPACE
Bharati: Why did you want to go into the telco space in the first place?
Rameez: There are very few industries in the world that touch everyone. I think transportation is definitely one. I think utilities, power services probably, but telco services are definitely in there. When you look at that space and you have a passion in making a change - changing something, improving someone's customer experience so that they can be happier during the day, frankly, very few things were left in the world.
We just thought that telco is one of those industries that is large enough, pervasive enough to touch everyone in the world and in which you can make a difference. I have been a consultant before, I have been a banker before, I have been in private equity before, and I've looked at all these industries from a very different perspective. Whether it's as a consultant or investment advisor, it's great to give advice, it's great to invest in companies. But the true heroes of the world are entrepreneurs who shake the world, who try to make it better, who try their best to make it better.
I have been lucky to have the group of mentors that I had who followed the similar path. For me, it boils down to that one thing: I wanted to have a shot in becoming one of those. I am following my role models in that way.
When you look at the consumer space 17 years since StarHub came on, nothing much has happened in the telco space. And what we had seen is that in many different countries, different kinds of advancements have taken place. What we realised is that despite all the advancements that have happened in technology, we hadn't really gotten to a point when we are using all of the technology in the telco space.
Bharati: Much of the way you market your service has to do with its flexibility and the lack of it in the telco space before you came along. Why do you think this gap wasn’t filled sooner?
Rameez: I think some of this has to do with the structure of the industry. When you go into an industry where it's not easy for other players to get in, I think innovation is challenging for current players. Let's imagine that I were a traditional telco and I have invested a considerable amount of money in the infrastructure and the computing system years ago. I have to see them through. I can't instantly get up this morning and say: I am going to redesign the entire structure of the company.
In some ways, that's the incumbent’s dilemma. But when you come from outside with a blank piece of paper and say: I am going to use whatever in terms of technology and deliver a model in terms of what a customer wants, it gets easier.
It's easier for you to use technology and innovation to bring it out. For instance, our entire platform is built on the cloud, which is an innovation by itself because anything above the towers is up there and it's easily scalable. It's better for the customers because it's faster and more agile and better able to serve customers.
Bharati: We’ve seen a number of disruptive players enter the market in other industries. For instance, in transportation, there are the private-hire car services. You might be seen as their equivalent, but in the telco industry. They’ve had to accept some regulation and scrutiny in their industry. Do you fear that in your industry, you may have to deal with additional regulations which may be suitable for traditional telcos but unsuitable for your business model?
Rameez: The parallel you use is very interesting from an innovation point of view, but if you look at our model, we are still much more regulated than the Uber and Grab cars of the world for the same reason you talked about. We need to ensure there are subscribers at the end of the line, ready to make sure we deliver the quality of experience that is expected. So we need to get the basics right. In that way, we are already regulated in a quality and service perspective, we are already regulated in the capitalisation perspective so we don't anticipate that it's going to be more. The current regulations are reasonable.
In fact, we think that we are going to be able to prove to the regulators and in fact many other parties in the space in saying that this is actually the future of the telco industry.
We are saying that if you are going to build a company today, you'd rather innovate in the middle layer, the network layer, the intelligence layer, as well as how you face the consumers, rather than worry about the assets, the towers, the buildings.
Bharati: But you still need the assets, the towers and the buildings, don't you? You will still need the likes of the incumbents, because you need someone to lease these assets from.
Rameez: Yes, in the same way anyone needs an apartment for the AirBnB reservation. In the same way someone needs a car for an Uber or a Grab. But where does the value get created? Who retains the value? The value would be retained if you think about these 3 sections: the front end, the middle, as well as the tower. It’s the cloud platform and how you serve through e-com and smartphone apps. It's those people and those things that would create not just value for the company, but value for the customer.
I think one day it will be possible for companies to exist that are just tower companies. I think there is a role for telco companies to exist to do just towers and I think there is a role for companies like us where we only focus on the front-end. The value would still be driven by the front-end, the way you deliver the service and the way customers have the experience. Because at the end of the day, the rest is more like infrastructure, much like the same way we did in broadband. So you have many more broadband players, but still the infrastructure is done by a single company and everyone rents the infrastructure from there.
Bharati: How did you convince M1 to do this with you?
Rameez: The biggest driver for them is that it’s going to happen anyway. It may not happen in Singapore first, may happen in other markets, but in Singapore someone else would do it anyway. When we thought of that, we pitched them the idea of an innovative partnership where we would say: look you do get a benefit, because the subscribers who come up to our system get double-counted as subscribers on your system as well. In terms of the revenue we generate, we have a wholesale rate with M1 so they benefit financially, they benefit in terms of the subscribers, they could become the number two telco company in Singapore because of the fact that we are rolling on their network. That is a huge deal. From a strategic point of view, it's a great competitive edge for any competition to come in. If another telco comes in, guess what, M1 has benefits from two other telcos, one is their own and one is Circles.Life. So a bit of strategic, a bit of financial, a bit of logical rationale around these things.
Bharati: So do you expect competition in the next few years, not with conventional telcos, but with virtual telcos like yours?
Rameez: It's possible. But it's not just the regulation they have to cross first. It's also the telco stack. We actually build the technology in-house, in Singapore. If they can do this, they need to build the technology stack, but clearly they can take many routes to get there. If they can do it through competition we welcome that, because at the end of the day they have to serve the customers. I think for the next 12 months, the traditional telcos will be the likely competition for the space, and they need to get the data-savvy customer right, and they need to get the technology right.
Bharati: We are going to see a telco enter the space soon - TPG of Australia. Is Singapore a big enough market for these players, including yours?
Rameez: I think it's difficult for someone if they step into the market now and say: I want to be a 15-20 per cent market player. It can happen. It has happened in the market, but I think it's the probability of reality. So that is unlikely, but I think it's likely that you would get players that would target to get about 5-6 per cent of the market, much like what TPG has said. I think it's possible, it's possible for that same reason. I think there is still a lot of pent-up demand for a better customer service telco company.
Bharati: You will be expanding to other Asian markets, but let’s talk about Singapore. A lot of consumers are quite disillusioned. Even with new players entering the market, they wonder whether competition would indeed result in better deals and service for customers. It seems eventually all the players end up offering similar deals, the same contract terms. In the end, will there really be a positive impact on the consumer as a result of competition? What do you have to say to that?
Rameez: If you approach competition from a very price-focused perspective, I think I agree with you. Eventually, everyone is going to match the pricing. But if you approach competition from the perspective of saying: not only do we have to be competitive in terms of price, but we have to think of ways to make it better for the customer. So let's say, improve the experience of buying, improve the experience of using the service, improve the experience of reaching out to customer service, improve the experience of flexibility and power and control. If someone steps in and says: you know what, I want to give you a better pricing, I can say: no, I have a better experience here. That is what matters at the end of the day.
Bharati: How sustainable are your plans and packages? To what extent can you continue offering such competitive packages and turn a profit in the long term? Several cynics have said this is all merely promotional and temporary. Your response?
Rameez: That’s the beauty of technology. It allows you to do things at a lower cost and our business model as you’ve explained, allows us to do that - save costs, hence offer better deals. Our digital model makes us asset light, enabling us to create innovative offerings in a sustainable long term way. Our newest product offering of 20 GB for $20 Data Plus option is not a promotion, but a product offering here to stay. We noticed a big gap in the market regarding data needs - everyone wanted data in quantity rather than more minutes and SMSes thrown their way. So it’s about customisation as well. Launching the product was our way of filling this gap for our data-savvy target market. We can understand how people might be surprised given that these things don't happen to telco customers in Singapore often. They were equally surprised when we launched Caller ID free as well, which for some reason still exists with incumbents in the market today.
Bharati: I mentioned the transport sector earlier. When new players such as the private-hire cars came into the market, the incumbent cab companies actually got really upset. They were even upset with the government for allowing these services to enter the space. Speaking generally, not just about the industry that you are in, what needs to happen in order for these tensions to be diffused, as more and more of these disruptive players enter various industries in Singapore?
INCUMBENTS NEED TO COLLABORATE WITH DISRUPTORS
Rameez: We like the idea of innovation. When you think only of disruption, it can get you into the loop that you want to disrupt and destroy everything and create something new. On our end, we think “innovation” is the right word, because “innovation” has a tone of collaboration with certain parties, much in the same way we are collaborating with M1 in this case. I think when you enter the market with an innovative mindset, your objective is not to obliterate everyone else. Your objective is to raise everyone else to the next level, to be the role model to say look, we can do this.
Bharati: Not all the incumbents see it that way. Some see it that way eventually, but not at first.
Rameez: They need to allow it to happen. Who is to say what is the future, but for sure, today's not going to be like tomorrow. In that way, they need to see that someone else would be doing it anyway, so incumbents need to think more like: ok, somebody needs to do it, why don't we work together and figure out a solution? And the new players need to think about it differently too: why do we need to obliterate everything? Why can't we just work with these guys, because that is what is going to happen - people renting cabs from car companies or taxi companies, but using an app to connect to customers. Why can't you think about that from the start? That would be more collaborative in taking care of the drivers, taking care of the services, no disruption in services for the customers - things like that.
Does the government have a role to play in it? I think the government only has to come in when things are not working. Otherwise, let it happen. But when people talk about regulating spaces, it usually means the businesses have failed in working together to find a collaborative way, so someone has to backstop the situation.
For us, the right balance is usually light-touch regulation, so keep your alerts on but don’t step in too early. I have seen the government do this in the transport space and that should be the Singapore way. Stepping in too early is not a good sign from a capital market perspective, and I think the Singapore government has done a fairly good job of it.
I think it's also the responsibility of stakeholders and the industry, especially the incumbents, when they realise that it's going to happen some other way. Even if you have the best regulations, best government, can we stop WhatsApp for example from coming in and disrupting the revenue of the telco companies? We couldn't have. Why can't everyone realise that tomorrow is different and work together to find a solution? Let's raise the level for everyone.
Bharati: We are in an age of disruption, but lot of people are not able to embrace it. What will it take for this type of mindset to become more pervasive?
Rameez: If you compare today to ten years ago, I think things are already much better. I think people just need more role models. People need to know that if they jump out of their safety nets, and leap into something, they are going to be ok. From the Singapore ecosystem, a lot more people are coming out and actually doing that. The help from the Singapore government totally helps. The first meetings for this idea, Circles.Life, were done in Block 71, which is a government ecosystem in Buona Vista. So we have benefited from it. The ecosystem definitely helps. It creates spaces for people to come together and create the whole environment where you see more mentors and more people who have done it before. That ecosystem helps, but frankly at the end of the day we have to recognise something. The recognition is the fact that if you don't change, it's going to happen anyway.
If Singapore doesn't change, if we don't change, somebody else is going to do it. Much like in the telco industry. Yes, telco did not innovate, but does that stop Skype? Does that stop WhatsApp? In the same way, I think we can't afford to be taking a back seat in any of these things and we need to be promoting both kinds of models: entrepreneurship outside, and also entrepreneurship within organisations. Because people need to realise the same thing. It's not a culture from 20 to 30 years ago. You don't sit there, get the job done and it would be fine, because as a global city, you get attacks from every place.
With Circles, you go back to what was passion really driving this thing. We, as customers ourselves, we are not getting what we really wanted from a telco. What are the global champions we are able to build? We need to see more of those. Would this be a telco champion that is built, made and envisioned in Singapore? And could we take it to different markets? That is really the ultimate ambition.
Bharati: What made you feel that stepping out of your safety net would be ok?
Rameez: Nothing. In fact to me I would say that it's a realisation of all these things, but you can sit there and keep talking about these things and one day you wake up and say: you know what, are you going to keep talking about these things are or you going to jump? Frankly there are those things. In those moments people are going to tell you: it's ok if you jump. If you fall what is the worst that is going to happen? You can probably go back to working for someone else. I can’t pinpoint a specific moment or a specific reason why I decided I had had enough of this thinking and I am going to jump. The reality is the second you jump, the whole world looks different. In my case for example, one would say: in about 12 months, 24 months, I am going to achieve this, achieve that, and that was very traditional to my consulting, banking background.
Have a growth plan in place and we are going to achieve these things. The reality is that once you jump into entrepreneurship, the line is not straight at all, it goes up and down, up and down, and if you hang on to a very traditional view of: this is my 1-year path and this is my 2-year path, then you would miss the innovative opportunities.
One day, you may be going down a path and say, this doesn't work. But maybe you’re one day away from making it work brilliantly. So you have to give up that sense of certainty. That is hard to do. If you can conquer that sense of certainty and uncertainty, that is a true skill to the path of entrepreneurship and you cannot imagine that unless you step in.
ENTREPRENEURSHIP – EASIER FOR SOME THAN OTHERS?
Bharati: You had a successful career as a business consultant and have even worked at Temasek Holdings. To what extent do you feel that was what gave you the confidence and even the financial security to take the plunge into entrepreneurship? Not everyone has that benefit.
Rameez: You have to go back and remember: what is financial security? It's getting more and more expensive to live even a basic life, but I think the key trick that comes from one of my mentors, is that your biggest albatross is going to be the lifestyle you maintain. If I upgraded my lifestyle the way I was getting upgraded in my corporate career I am going to have a much tougher time. I am lucky to have non-excessive needs. That allows you to maintain a lifestyle whereby you are not worried.
What I realised, which I didn't see three or four years ago, is that when you are so engrossed in your passion, you really don't care. Because for me, this is a much better fight. When your vision is so strong, so surreal and so personal to you, you forget about everything else. I can live in a one-room apartment if I have to as long as I am doing what I am doing. It comes with the same thing, as I've talked about the "why". Unless your "why" is clear, none of this is clear.
Bharati: Earlier you said, “If I had upgraded my lifestyle the way I was getting upgraded in my corporate career…” you would have a much tougher time. You’re less financially stable now?
Rameez: When you build a business like this, you put everything you have into it. So everything, whatever you have, everything is in it. Because that is the only way, if you believe in something, you’ve got to do it that way. When I started, I was slightly more comfortable than some other entrepreneurs when they started, but nobody is truly comfortable in this thing. If it's really about the money, I would have just stuck to my job. It just made a lot of sense to continue in that. I had figured out the map. I had figured out how to navigate in that world.
GOVERNMENT NEEDS TO STEP BACK
Bharati: What do you think about the government’s efforts to promote and support entrepreneurship? You’ve benefited from all this yourself.
Rameez: I think we need to also recognise that the government should not do too much. I think the government has done a good job in the sense that they are pushing a lot but they are also backing off now, saying that now we need private sector people coming in and making an objective analysis of whether certain things are working or not.
I think we have to do things more independently, so that companies realise that they need to try out and seek out more venture capital that is more independent; versus going for: “I have a great idea. I am 35, 40 or whatever. What is the government scheme that exists that is going to help me start a business?”
We have to get out of that. One of the reasons you want to find independent and financially-driven investors is the fact that they would be more critical about the idea and make sure you achieve your ideas and plans accordingly. That is one thing we could try to do.
Bharati: You have independent investors, but while you say the government needs to step back and companies need to be less reliant on government, you yourself had a lot of government support to get to the place you're in now. You talk about Block 71. You also had support from the National Research Foundation.
Rameez: I believe there needs to be a balance. We’ve done both. 10 years ago, there wasn't a balance. But today, I think the government has gone above and beyond to spark the innovation ecosystem - systems, spaces, funding, kindling a debate about risks and easy funding. The onus now should be on entrepreneurs to take a step back from the relatively easier route of government support and instead test their ideas against the higher bar of private investors. After all, globally competitive local champions will need to grow beyond Singapore where such favourable conditions will not exist. Leveraging too much of the local government support makes you less competitive if the world is your stage. All stakeholders must recognise that.
Bharati: Some feel that the education system in Singapore needs to change to influence the young to be more adaptable so that people become better-equipped to deal with change and uncertainty and actually thrive, whether as entrepreneurs or workers. What do you think?
Rameez: I think the answer is everyone has to play a role. The government has to play a role. No question about it, because it is the biggest entity responsible for the education system. I think parents have to play a big role in telling them not to get the A grades or A-stars for everything. A-stars don't help you create a telco company in Singapore.
I did get the A-stars but I don’t think it has much to do with that.
I think the flipside is that a lot of people get too hungover on the idea of entrepreneurship. I think what we have to do is to focus on critical thinking. Critical thinking can lead you to form a company. Critical thinking could lead you to become an MP, could lead you to do something completely different in marine biology.
So really the most important is that critical thinking. It needs to come with the fact that, ok, the traditional benchmarks for success are going to be thrown out the window in this new world. Whatever your parents did, they cannot do the same for your kids and this generation. If you really recognize these principles, then you could play a part to find your own meaning in things. When you see more examples - and this is a tough one because it's a chicken-and-egg problem - like your cousin, your brother, someone who has taken the critical path journey and succeeded, you will see that it's ok, you can go do those crazy things for like a year, and then come back later.
SUCCESS IS ACTUALLY AN OBSTACLE
Bharati: We talked about the need to adapt. What do you think is standing in the way of some businesses changing?
Bharati: Explain that.
Rameez: If you are making money, it's just so hard to say that whatever I know, whatever I’ve learnt, whatever used to make this money could be wrong or could become obsolete.
But the reality is that in today's world the pace is changing so fast that someone is going to eat your lunch anyway, eventually.
And if you don’t see that, you won’t build the skills for tomorrow. That's the thing. If you are not going to anticipate that tomorrow is going to be a different day, you are not even preparing for it for let alone being ready for that day. If you are not preparing and not ready, you will not lead the day. That is really hard, that's why successful businesses’ number one problem is, who is going to come in and innovate in their space? If you can pick up some trends that are different, whether you are talking about retail at Orchard Road, or other industries, the one thing that is true is that besides the fact that you always have to innovate, always have to think that tomorrow is going to be different, you cannot think that you are a successful company, even if you are a successful company.
Bharati: What are the most important personal lessons you’ve learnt in the last year since Circles.Life was launched?
Rameez: Sometimes I have great days, and almost like Buddha, you have to say, I don't care about these great days. Don’t get too excited. Because then you have really bad days and at that point of time you really have to remember: Don't get too worried, it's ok, think about why you are doing it, as long as the direction is right, as long as the vision is right, it is ok.
If you think you are going to do something great without having those journeys that are gut-wrenching that would make you wake up in the middle of the night with a tear on your face, you’re wrong. But that is a sign that you are onto something that is interesting and great enough. The reality is remembering that, remembering how to deal with those ups and downs by figuring out why, why are you doing this thing.
Sometimes it's easier to handle the downturns. What's harder is to say: don't get excited on the upturns. Because that throws you off as well. Puts you on a fake sense that you achieved anything; but frankly half the reason you get anything done is sometimes luck. You have to be humble to the reality of things.
Bharati: What has made you wake up in the middle of the night with a gut-wrenching feeling?
Rameez: I think it's mostly been about: “Can we deliver this vision that we had?” Can we create a team that can deliver this model? So we have a lot of responsibility. If I go out and keep talking about customers, but I let 5 customers down, 10 customers down, how can I live with myself?
Bharati: In terms of what you’ll be doing next, aside from internationalising, what’s on the cards in terms of technological advancements that could improve the customer experience?
Rameez: If you take a 10-year horizon, there is so much that can happen. Why are we still using 2-way SIM cards? Why haven't we gone to electronic SIMS. Why can't I provision your phone the second you press buy on the e-com website? But the core of all these is the technology stack we built, what we developed in Singapore is good for us to take it multiple markets. That's what we depend on. When you build something, build it for the world. Don't celebrate success just because you are successful in Singapore. Unless you have proven that the model actually works in multiple markets, you have not proven anything.