KARACHI: You would never think that a company that was giving Alibaba.com – the world’s largest business-to-business portal – a run for its money around the world was based out of Karachi and yet there it is. Tucked away in an office suite on Sharae Faisal, the global headquarters of Tradekey.com look rather unremarkable, until you start asking the executives what they have achieved and what they plan on doing next.
“We want to be one of the world’s biggest companies,” says Junaid Mansoor, the founder and CEO of Tradekey, in a rather matter-of-fact tone of voice. “We want to be in businesses that affect the largest number of people.”
Tradekey.com, the world’s third largest B2B portal, is certainly an impressive beginning by the 32-year-old Mansoor, though by no means his first venture into the world of web-based start-ups. The serial entrepreneur created his first company when he was just 15 years old: a web-based e-mail service that promised to share its revenues with its users. (The site – moneywithmail.com – went bust when the dotcom bubble burst in 2001).
Tradekey.com has about 5.8 million members, of whom only about 5,000 have paid subscriptions, the source of the bulk of the company’s revenues, though the company also offers advertising services. While it does not release financial information about itself, based on the company’s fee for its two levels of premium services, Tradekey’s revenues are estimated to exceed $3 million a year.
Crucially from the company’s perspective, however, it has been growing at a rate of more than 86% a year (Tradekey did not offer a precise number). According to Mansoor, an analysis conducted by a third-party expert valued the company at around $700 million.
Taking on the giants
As impressive as those numbers are, however, they are dwarfed by the company’s key competitor: the China-based Alibaba.com, which had revenues of around $871 million in 2010 albeit with a slower but still impressive growth of around 43%.
Yet Mansoor and his team are not daunted. They point out the fact that the website is ranked number 7 worldwide by Google’s page rankings, compared to number 6 for Alibaba.com. The company also claims that there are about 20 million keywords where Tradekey.com would be on the first page of a Google search.
Mansoor claims that the company helped facilitate $1.9 billion in transactions last year. Tradekey’s biggest advantage, however, seems to be that, unlike Alibaba.com, it is a B2B platform where buyers – mainly from the United States and Europe – outnumber the sellers, a remarkable position for any marketplace website to be in.
The next phase of the company’s expansion seems to be to take the battle to its chief competitor’s home turf. While much of Tradekey’s 500 staff members are based in Karachi, the company has opened up two offices in China, in Beijing and Guangzhou.
“We are a Pakistani company competing against Alibaba in China,” said Saqif Chaudhry, the head of corporate strategy at Tradekey. Executives at the firm, however, wanted to point out that they want to be different from their competitors.
“You cannot compete with the number one player using their own strategies. You will remain at best a number two,” said Mansoor.
Tradekey plans to roll out new products in the near future, said Mansoor, and he provided a few hints at what they might be. “Group buying is something we are looking at introducing,” he said.
In addition, Tradekey is leveraging its incredible marketing platform, as well as its presence in China, to offer
Tradekey’s larger ethos seems focused on making it easier for people to do business across borders. Among the services the company is contemplating offering are company formation around the world as well as website development.
How they build a motivated team
Yet as innovative as Tradekey has been in the world of technology, the company’s real innovation seems to be in the realm of human resource management, where the firm has come up with a unique performance management tool to help it build a motivated and dedicated team in a country where finding and retaining talented people can often be a challenge.
While acknowledging that a lack of a developed web or software industry in Pakistan is a problem, Tradekey did more than just complain about the problem: they solved it.
Using a unique system of points that rewards employees through pay raises and free gifts for acquiring skills and expertise that would be useful to the company, Tradekey has been able to ensure that its work force is motivated and constantly trying to stay at the cutting edge of technology.
Employees must pass certain tests in order to move up levels in terms of knowledge. Mansoor points out that an employee can complete each level in as little as three months, which would then translate into an immediate pay increase.
The increments can be quite generous. “An employee can jump 10 levels in as little as three years, after which they would be earning as much as Rs400,000 per month.” Compensation levels that high for employees three years out of college are unheard of in Pakistan.
In addition, the company also awards “air miles” for every level completed. Employees can then redeem those miles for such things as iPhones, iPads, vacations both within Pakistan and abroad as well as household items. In order to ensure that the company’s interests do not conflict with the employees’ family lives, many employees have given over control of their benefits portal to their spouses and children, who then become stakeholders in that employees’ progress at the firm.
“We want to link our people to the strategy of our business,” said Mansoor.