Entrepreneurs truly are our first and last line of defense against monopolies. They help build competition in markets that could all too easily become dominated by one company, ensuring that consumers have a voice.
Chet Kanojia’s entrepreneurial ventures often have a theme of pushing back against the “big guy” — and for good reason.
As a kid growing up in Bhopal, India, he was profoundly affected by the Union Carbide plant disaster, which exposed more than 600,000 people to harmful gasses and resulted in 15,000 deaths.
It is the world’s worst industrial disaster and Chet was around 12 or 13 when it happened. He says witnessing how corporate mismanagement resulted in major tragedy left him distrustful of big business.
“I have this view that a lot of large corporations — left unchecked — typically optimize for themselves and for shareholders versus for society in general. I think that tends to be a very short-term view,” he says.
That perspective informs the kind of innovations Chet has introduced to the marketplace. His previous company Aereo was an attempt at creating an open platform for television to give viewers more control over their TV content. “The idea was to be a creative voice, direct access to consumers,” he says.
Now he’s building Starry, which offers low-cost, fast internet access.
“Unfortunately because of how complicated [broadband connectivity] is and how capital-intensive it is, it’s the dominion of a handful of companies,” Chet says. “Breaking that down and adding more options will move society forward.”
The company is already one of the major providers in parts of Boston, according to Chet and they have plans to offer services in Chicago eventually.
An edited transcript based on Chet’s interview offers a snapshot of how he’s changing the way we get connected and building the internet company of the future. Oh, and if you like the sound of what they’d doing, Starry is hiring.
Solving for high-capacity networks in densely populated areas
Chet: After I sold my first company, I was motivated to do philanthropic things. I did a project in India, where I set up a shed with like 50 laptops and just kind of opened it up to kids, just to see what consumption would be. The kids started just using YouTube and various sites as almost a library.
It spoke to me that I could lower the barrier to access and make broadband a general utility instead of a fight with the cable company. It could be a really powerful utility available everywhere. It makes a lot of sense.
You can take a step back and you say, ‘Well, how many people can work from home in a customer support function and not have the additional expense of a car or childcare?’ Access networks are notoriously valuable and historically have been monopolies, but deeper connectivity has a deeper and much bigger societal impact.
Our bet was urbanization was the core trend that was going to be interesting to solve. People are moving to cities and dense areas, whether they live in New Delhi, Sao Paulo or New York, right? Everybody’s clustered in high density areas. So Starry was a pioneer in developing technologies for solving high-capacity networks in dense urban areas.
This isn’t just ‘some app’
Scott: What were the most challenging things to be able to even start this process?
Chet: The biggest challenge in this tends to be the cost of network construction. Typically, it’s up to $2,500 a home, plus $500 in marketing and equipment. So you ended up at $2,500 to $3,000 per customer, and even God doesn’t have enough money to pay for that kind of stuff. So when we started the company, we decided if we could get to the home for $20, it’s worthwhile, because initially we can even make money with low penetration rates.
We design our own chips, front ends and network equipment. We provide customer service, we have fleets — all kinds of stuff to solve for that low-cost structure. I’m pretty proud to say that in four years we went from zero to building the tech stack and setting up supply chains. This year we will end with coverage in about 4 to 4.5 million homes. It’s not that many customers, but just to go from zero to that many in coverage is a miraculous number.
You know, this is such a spectacularly complicated sector. If I were to classify core challenges, number one is access to the spectrum, because this is on licensed spectrum. How do the startups get access when these things cost billions of dollars? How do you convince people, investors and prospective employees, that this is gonna work? And then getting to the core question, does the customer even want it? So how do you do all of this in parallel and sequence it out like a sheet of music?
And then when you’re inventing shit, every now and then things kind of go off track. So how do you manage that? I’m not complaining. That’s the kind of project that gets me excited as opposed to making some app or whatever.
Internet access is just the beginning
Scott: This is such a huge vision. How do you pitch this to people?
Chet: The entire traditional venture capital ecosystem wouldn’t touch this with a 10-foot pole because it’s got infrastructure, it’s got technology, it’s got spectrum and it’s got operations. You know, all the grimy stuff that nobody wants.
The core questions in the investor’s mind becomes: can you get customers, what’s the competitive response, and what’s the quality of your service going to be? All of those really sophisticated investors just want proof points step-by-step. So it’s just sort of sequencing that up and working with investors that are sophisticated enough to understand.
It’s a massive sector, and this is just the beginning. Once you have a relationship with the consumer in their homes — if you are trusted company — the things you can bring to their life to expand on that relationship are even more powerful.
‘Your customer is God’
Scott: So we look at this from the angle of a business vision and user mission. What has to go right for you?
Chet: Our view is customer first. If you talk to any of our customers, the fact that the service quality is great is not the first thing that comes to mind. The first thing they will say is that our employees treat you great. As we grow, I encourage our customers to call us. In fact, if you’re a customer, you get a little welcome card that has my cell phone number on it. Nobody has called me yet, but they could.
For us — and this is a very Indian philosophy — your customer is God. Having a happy customer who really likes you is way more important than anything else.
Scott: Why is it that most of these big business carriers have just garbage customer service? Is it the sheer size, the training, or what?
Chet: I don’t think it’s all ill-intentioned. These people all grew up in an era where the systems and technologies weren’t in place. They aren’t instrumented to be able to have that relationship with the consumer, and it is such a large gap between the customer and the really well-meaning executives. I don’t think it’s a size issue. I think it’s how leadership manifests itself to systems and software. That goes to billing, collections, you know, everything down to the customer.
Scott: I totally agree with you. As you start to scale, you can start putting people in boxes and making them feel like they’re supposed to sending a memo instead of fix a problem. That to me is the key difference. You’re running a company that is empathetic to the consumer, not sympathetic. I’m not sorry that my service sucks. I can understand the problem that you are in because of what I didn’t do or did do, and I can fix it.
Chet: To me of it is sort of a defense mechanism. I’m abdicating my responsibility, but I actually don’t think I know the answers to these questions, right? So my approach tends to be low.
We want our customers to feel like we care about them first and foremost. They are first to us. And I tell our head of care, just make sure that people are at the center of it. I’ll do the same thing with software developers, tell them not to hide a feature about disconnect or something. So we try to sort of put that in and hopefully it sticks. And then there’s the beauty of attracting employees who are true believers. They’re here to change things. If they want to need the job, there’s plenty other easy jobs that they could go to.