Under cover, inside your cellphone

Exotel loves Asterix. So much that the Bengaluru-based cloud telephony company names its offices after characters from the legendary comic strip. What’s more, its newest business seems inspired by the indomitable Gauls who always find a way to beat back the meddlesome Romans. Except this gig is about thwarting intruders whose weapon of choice is the ubiquitous mobile number. And there’s nothing funny about it.

Led by 32-year-old Shivakumar Ganesan, Exotel has developed a telephone-privacy solution that routes and encrypts calls via its servers, enabling customers of online services to communicate with the service provider without divulging actual mobile numbers. To get the big picture, think how mobile numbers are shared online without a care, for booking a cab, or ordering chow, or buying a dress. While the mobile is fast becoming the standard conduit for transactions in the age of digital businesses, the human voice underpins the delivery of pretty much everything. Cabbies find it easier to talk and locate us rather than following a map, and food reaches us hot only if we tell the delivery guy what the nearest landmark is.

But these matter-of-fact exchanges could easily turn threatening, as Delhi-based Avantika Tyagi found in November. The delivery boy from a neighbourhood restaurant bombarded her phone with pesky texts after she ordered food using Zomato’s ordering service. Her story went viral, prompting Zomato investor Sanjeev Bikhchandani to post an apology on Facebook.

Sometimes the stories can be amusing. Manu Jain, head of unicorn electronics manufacturer Xiaomi’s India operations, told Fortune India how he was recently called up by someone posing as his boss, Hugo Barra. “I’ve lost my phone, so I am calling from someone else’s phone. Can you give me [Flipkart co-founder] Sachin Bansal’s number?” the caller asked. The Indian accent was a giveaway that he was not Xiaomi’s Brazilian global vice president. No damage was done, but the overture showed how easy it has become to subject just about anybody’s phone number, no matter how privileged, to hoax calls.

India has proved to be particularly strong ground for services built around mobile identity. It is the biggest market for Stockholm-based spam blocker and mobile number discovery app Truecaller, which claims over 100 million subscribers here. Now, with swelling custom for online ordering, demand for number masking is on a tear.

Enter Exotel. Sitting in his office near Ulsoor Lake in Bangalore, biking enthusiast Ganesan—Shivku to everyone—is clear about his focus. “Privacy of the digital customer is what I am building this business for,” he says. “Earlier your service provider, say a plumber, was someone you knew and trusted. These days, I estimate that every tech-enabled transaction involves at least three phone calls. The easiest way to harass people is through phone numbers. That’s what I want to stop.” In 2015, calls handled by Exotel for clients such as Uber, Ola, Urban Ladder, and Zivame grew from 56 million to nearly half a billion—a 750% jump over the previous year.

As mobile users become more conscious of their online footprints and security takes centre stage in conversations around the digital economy, the imperative to invest in solutions like Exotel’s will only get stronger. A 2014 study by business and risk research company LexisNexis red-flags mobile as a “growing fraud channel” and advises that “regular review and adoption of more effective fraud solutions are a must for large e-commerce merchants to maintain customer loyalty and trust”. Clients like Ola put a slightly different spin on it. “It’s useless for a driver to have the number of a customer beyond the ride,” says Anand Subramanian, the cab aggregator’s senior director. “That’s where the idea of number masking comes in.”

EXOTEL’S ORIGINS were in a different business. After stints at Yahoo and Flipkart, Ganesan started Roopit, an online classifieds company, in 2010 when he realised that like thousands of other small entrepreneurs, he was losing business because of missed calls. Along with techies Ishwar Sridharan and Siddharth Ramesh, he got down to building a platform that would help companies manage their call centres on the cloud, allowing them to divert, record, or track a call, or set up voicemail.

Ganesan raised Rs 2.5 crore from Mumbai Angels and Blume Ventures, but there was speculation that Exotel would shut down as companies like Knowlarity, India’s largest cloud telephony player, were dominating the business with far deeper pockets and more customers. However, the wave of app-based services gave Exotel a new lease of life.

Cloud telephony, the core of Exotel’s business, is a large opportunity, with some reports pegging the Indian market at $6 billion (Rs 37,902 crore). It is the favoured customer care platform because calls can be recorded and monitored. In businesses like logistics, where runners need to make numerous calls, the cloud is the most efficient way to track and reimburse call charges.

But cloud telephony has a low entry barrier because the technology can be replicated. Also, in 2014, the Telecom Regulatory Authority of India cracked down on cloud telephony firms like Exotel, demanding that they get separate, expensive licences for each circle they wanted to operate in. To compensate for the curtailed playing field, Ganesan had to expand the range of services, rejig prices, and shift focus from SMEs only to a mix of SMEs and enterprises.

To hedge against such risks, Ganesan is buffing up Exotel through acquisitions and creating intellectual property. Last year, the company took over Voyce, a customer feedback collection platform. It also acquired Singapore-based social media startup Croak.it, which allows users to share 30-second audio snippets within their communities. An emotion detection system to gauge customer satisfaction during phone calls is a key offering in the works.

Meanwhile, it is the call-privacy business that Ganesan wants to build a moat around. In a scenario where the Internet of Things becomes part of everyday life, every device will have a unique identity, and masking will become far more critical. Now that will be the Perfectmix for a magic potion.