Wifi Dabba (YC W17) – Own a Piece of the Internet in India
wifidabba.com
wifidabba.com
Our master plan is simple: Develop low cost broadband distribution technology. Prove it works by connecting one million people in one city. Once it works, deploy worldwide.
Step 1 done - We have built a low cost network stack and have lowered the cost of deploying a citywide broadband network from $50m to $5m. We use lasers and commodity components thereby avoiding the core expense at the heart of current ISPs - expensive underground fibre and its associated manpower, heavy capex and regulatory pains.
Ready for scale - We've run a beta network with thousands of live customers over the last 9 months and we know the tech works. We're now ready to scale across our hometown of Bengaluru with its population of 11m people and less than 10% broadband penetration.
A killer proposition - We have a killer offering for the customer - 1gbps speed with no data caps at $10/month and a free Wifi Dabba router. This is 10x better and cheaper than anything else on the market. This playbook has been executed successfully in the mobile 4G market in India by Jio, we're applying the same playbook in broadband
Go where no ISP has gone before - We're taking an AWS-like platform approach to our tech stack, our goal is to deliver deep APIs, network integration points, edge-caching and much more. We believe this approach will result in a whole new class of applications and services for users. We want to be the ISP that developers will love.
The ask - This is where you come in HN, buy a piece of our network and help shape the future of the internet. We're offering minimum guaranteed revenue, naming rights to your region and a host of other benefits. There are only 66 of 100 regions available. Each region is $20,000.
The website wasn't convincing, but this doubly so. What is your technology (which scales) that enables 10x savings, given that ISPs are operating on razor thin margins already?
Also, 20k*100 = $2million. If the technology is proven, wouldn't you be able to just raise it without a lot of trouble? I want you guys to succeed. It's just that you might need to provide better arguments here.
The fact that we are using FSOC to replace the underground fiber is what creates the 10x in savings. It only takes a few hundred FSOC units to do the job of the fiber as the core network and is much, much cheaper.
I've added a reply further down the page that addresses why we'd like the public to be involved, I'd be happy to elaborate more if you've got more questions.
Then why aren't other ISPs doing it?
Also, it's worth noting that most ISPs/telcos are manpower and regulations based resource extraction organisations. Their moat is being able to handle local bureaucracy and pump in the heavy capital required to deploy the network. They like to buy and use proven tech that comes with SLAs and support from large tech vendors. They will wait for FSOC to be mature before they do anything meaningful.
We get the largest ROI from FSOC tech simply because we're building the network from scratch and are targeting the low cost market that is currently underserved. Most other ISPs are aiming for the premium market.
Free space optics isn’t some new technology. The real reason FSO isn’t used is because despite almost half a billion USD in R&D over the past 20 years the reliability issues haven’t been solved.
And AFAIK Hathway (another ISP in India) too tried something like this but didn't succeed and they went back to traditional fibre.
I don't know anything about the tech but it seems like it is not so easy and I do hope Wifi Dabba succeeds.
I'm not a lawyer, but since you're part of YC, you may want to reach out to your legal mentors and ask if this post/advertisement/promotion satisfies the SEC's Howey Test[1] due to HN having a material portion of US participants some of whom may not be accredited investors and HN is publicly readable.
The US legal case SEC vs. Howey[2] uses 4 prongs to determine whether an offer is an "investment contract", namely "a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party."
It sounds like you're satisfying all 4 prongs of the Howey Test by offering: a) a purchase contract for a Wifi Dabba; b) investing funds in Wifi Dabba; c) expectation of profits via "minimum guaranteed revenue"; d) from the efforts of the promoter, Wifi Dabba.
Many 2017 cryptoasset tokens tried to raise money via token sales to US investors which the SEC classified as unregistered securities offerings which violate the Securities Act[3]. The SEC has had varying success going after organizations that offered unregistered securities offerings, but I don't think you (nor YC) would want that legal hassle.
Based on your website and explanation, Wifi Dabba's mission sounds exemplary and a net-positive to democratize connectivity in India. Hence, I'm really rooting for Wifi Dabba and hope that you've spoken to a US legal advisor or YC legal mentor.
EDIT: You mention on your website that you're a Delaware entity with an office in California, which implies that you are really bound by US jurisdiction + potential US investors. Please seek legal counsel.
[1] https://www.investopedia.com/terms/h/howey-test.asp
[2] https://en.wikipedia.org/wiki/SEC_v._W._J._Howey_Co.
[3] https://www.govinfo.gov/content/pkg/COMPS-1885/pdf/COMPS-188...
EDIT: I had thought that a commercial franchising agreement implicitly assumes that the purchaser would be operating the franchise directly. However, in this case, it looks like Wifi Dabba will be operating the POP equipment in India for investors not in the immediate POP vicinity. In any case, all the best!
That was back then.
In the past few months, Reliance Jio have dropped fibers everywhere even in that edge of India, reaching homes with Gigabit Internet options. I have a friend who invested in a small ISP there and I was interested in that. They no longer don't care and are now piled up with over-time work laying, connecting, and fixing up connections.
I understand the philosophies of choices and alternative options. Nonetheless, what are your plans to compete and/or differentiate when the 99% of people don't really care from where they got their internet?
The other things I see is the likes of StarLink[1], which is not physically bound by wires and is a matter of turning knobs as and when they have enough satellites to cover other areas of the world.
Amongst all of these, where/how do you plan to compete/operate?
- We know from first hand experience that the hype of Jio fiber doesn't reflect on ground reality. We know this because every ISP in Bangalore is a partner of ours. For the last 3 years we have been serving 100s of apartment buildings and tens of thousands of customers using ACT, Hathway, Airtel and Jio's network. We have dozens of instances where none of them can provide connectivity at the edges of the city or dense market areas.
- Our plan doesn't require competing with any of the existing players. Less than 7% of India has broadband access, only 20 million households have broadband access. There's a large open market with room enough for multiple players.
- Our offering to the consumer is also deeply competitive. We're offering gigabit connections with no data caps at one tenth the price of existing providers.
- We're really excited about starlink, but for them to ramp up coverage and then get permission from the Indian government to allow their signals in India and then scale up to being able to provide access to 100s of millions of people is a long way off. Starlink is a great solution, but there are so many people in India that need access that they will be one of many players required in the market.
What's the revenue from the existing points of presence?
It's a bit misleading to compare to broadband where most people have effectively unlimited data on their phones nowadays. In 2017, this made sense sure. I will be very surprised if people pay for wifi in Bangalore today.
With regard to people having access via mobile data, you're right, India's made massive strides in 4g for sure. But our on ground experience over the last 3 years has shown us there's a massive appetite for more data so long as it can be provided at a reasonable price. Also, if you're in a dense market or housing area, current mobile signals don't provide good enough coverage and as the mobile networks are already running at 100% capacity there isn't much room for them to improve.
As mentioned elsewhere on the thread, less than 7% of India has broadband access, there's still a large market open for a provider that can offer high speeds at a reasonable price.
Worse, the amount is just shy of typical angel investment but with their offering you'll likely have less rights than an investor does.
- The website looks fine to me (it's not egregious like the other commenters say), but it might be worth making the landing page clearer.
- Are the PoPs meant to be purchased by retail investors? $20,000 seems a bit steep for most people to invest in. It's also too small for most institutional investors. Do you guarantee returns for eternity? This sounds like a "too good to be true" proposition. Why not package multiple PoPs into a larger financial instrument so that returns are more even, and then sell them to institutional investors? Lambda school has taken a creative approach to bundling ISAs: https://lambdaschool.com/the-commons/announcing-our-new-isa-...
- What are the parameters for your FSO technology? How well does it work in rain/smog and other environmental conditions? What wavelength are you using?
- last mile is tricky because you still have to invest in infrastructure and marketing to the end user. Does $20k really cover that?
Either way, I love the idea, just skeptical about the economics and the technology. Hoping to hear more about you guys in the future!
- The PoPs are meant to be purchased by retail investors, we've sold 35 of them so far. We're offering it as a franchisee agreement for a period of 6 years with a 70-30 revenue share split with minimum guaranteed revenue.
- Regarding the FSOs, we've been serving thousands of live customers for the last 9 months off the FSOs and have greater than 99% uptime through rain, hail and heavy winds. FSO has come a long way in terms of reliability and throughput since the early days. We're using the 1535nm - 1565nm wavelength.
- We've wired thousands of public wifi hotspots as well as large buildings and campuses over the last 3 years and a have a really clear deployment strategy and team in place.
- Yes, the $20k covers the cost of the lasers, deployment, sales and management of the service and customers. We've put in a huge amount of effort over the last 3 years to bring costs down by using a lot commodity components for routers, switches, etc.
- The $20k price point hasn't been much of an issue so far, but happy to hear more feedback on that. We're thinking about setting aside a few PoPs where a group of people can pool money to purchase one. Would love to hear your thoughts on that.
I think the biggest question for the casual retail investor would be how well will a given PoP perform. If there is high revenue variability between PoPs due to housing density, per capita income, etc., you will start facing disgruntled investors pretty soon. The other issue with smaller investment size is that the "management fees" are likely to be higher - you need to address more questions and concerns from individuals about your product. Pooling PoPs might solve both of these issues elegantly with a more complicated financial instrument.
Edit: I also noticed you used the term "franchisee" agreement. I think this might be slightly misleading to investors because franchise owners generally have a lot of control over aspects of the business, whereas what you're selling is a more traditional financial instrument.
Regarding the use of the word franchisee, we've actually had a really counter-intuitive lesson while selling the PoPs. Initially we always referred to it in financial terms but what we found was that buyers were using the word franchisee themselves and preferred the term. It makes sense if you look at it from an absentee landlord share-cropping view, except in our case, we provide a fully managed service where you don't have to actually do any work.
We've set aside 5 PoPs for people that want to be part of a pool in case the $20k price tag is too high for them. We've just started to see some traction on that, so it'll be interesting to see where it goes.
Aren’t customers complaining constantly?
Furthermore, all the explanations are in videos and not in text? I don't want to watch a bunch of videos just to figure out what this thing is. AND the videos don't have captions. So if I have a hearing disability, there's no way for me to figure out what you guys are doing?
Is it too much to expect a YC company to have a half-decent website?
i'm on a laptop and there is a max button at the right bottom of the video. i clicked on it and it seems all clear to me.
the squeezed view is also okish.
i am watching the second video and it seems pretty neat to me. the speaker is quite clear and i can understand his explanation
It's 2020. It's not hard to make a website that's usable on mobile.
I've seen that problem on a few sites since i'm on an ultrawide, but even adjusting window size to a more regular/manageable size did not help.
Also in one of the comments you briefly mentioned that you can help democratize/prevent censorship? But aren’t you guys by law supposed to block certain websites? And wouldn’t your foreign ownership be under scrutiny if some incident were to happen?
I have few questions
1. If you launched in India why the prices are showing in dollars?
2. 1.5 crore rupees is a lot of investment. I think one can cover 1 km of fiber network with that amount of money, no need to go for wifi dabba
3. On website it said better for rural areas. How is it good for rural areas where houses are not multi storey buildings (can't grab bunch of customers, but in apartments that can be done)?
This includes but is not limited to - Bank Debt, Venture Debt, Equity, Revenue Share based Debt, indie.vc style debt (revenue share debt payback), ads on billboards below/above/next to the wifi towers and so on.
Why go the public retail investor/franchise model route? Are all of the above exhausted or infeasible? If so - why?
Further, the network doesn't require a city coverage for it to work. It can be added piecemeal over time. Thus, you don't need the entire city coverage to start with - but major population dense areas to make the $20k payback in a few months. And the profits there on can be reinvested into more PoPs. Starting capital is $1.3M - its not hard to raise with a working solid business - in debt format if you don't want to give up equity.
There are a few reasons why we would like to get the public involved:
1. It's taken 20 years, 13 telecom companies and about $200B to bring mobile internet access to 600 million Indians. Broadband deployment is more expensive than mobile deployment so even napkin math gives you an idea of the magnitude of money and time it will require to truly make a dent in the connectivity of the country. If we can lower the cost of the deployment tech then we will able to lower the cost of ownership and distribution of the tech. This would be a win-win for consumers and investors.
2. A whole lot of the issues that plague the internet today, from the splintering of it into a chinese network, censorship, net neutrality and other issues comes from the fact that it's so expensive to deploy these networks that they fall into the domain of mega-corps or nation states. As a result, control of the internet falls into a few hands and we have an internet that is getting increasingly centralized. If Wifi Dabba can spread ownership of the network then we hope that it will lead to more open internet that is harder to control or shutdown.
3. You're right, we're aiming to raise only $2M from the public - 100 PoPs x $20k each. Not sure where the $13M comes from, if you could point out where you see that number, I'd be happy to rectify it.
4. We've also built a lot of safety elements into the purchase process. We're following Kickstarter-ish rules where you only have to make a $1000 deposit - the remainder to be paid only when we sell all 100 PoPs. Furthermore we offer a 100% refund in the first 12 months should you choose to change your mind at any point.
1. The cost for a setup and maintenance is $2M for an entire Tier 1 city in India - that's peanuts compared to the revenue you will generate if the general public starts using the network and pays for it. You can self fund this to a large scale.
2. Wifi Dabba as an entity controls this infrastructure and that entity also controls the software that powers the infrastructure. The PoP is not an independent entity working in a decentralized matter. If the Indian govt says Wifi Dabba as an entity has to shut down - it can easily do so without any problems and the network goes down with it. So its hard to agree that this solution is truly decentralized.
3. There was some weird calculation error on $13.2M figure. I fixed it - sorry about that.
4. That I understand, but my question isn't about the legitimacy of the fundraise.
Apart from point #2 - my original question is not addressed.
Have you explored and ruled out traditional forms of financial instruments? If yes - why? If not - why not do that first for 1 or 2 cities and then the model can be flipped into public retail investment/franchise model at a later point once you prove a successful rollout on a city scale.
In the long run our hope is to lower the cost of the tech enough so that anyone can participate in the ownership and distribution of broadband at a reasonable price. This is the first small step in that direction.
I definitely echo all the bad feedback about the website - it does not give a good impression at all and makes me re-think about all of your other claims as well.
is p2p that much more popular? are you streaming everything in 16k+?
Canada
I stream alot. I have 3 IPTV boxes, Netflix, 2 mobile devices, and my kid watches a tonne of YouTube.
We constantly hit at least 1.8tb/month.
We don't upload anything, just alot of 1080p streams (don't have 4k device).
I last had a 150GB/month cap when I had ADSL connection and only 1.5Mbps connection like 15 years ago.
Heck I just did 110GB of wifi usage on my 1 phone this past month.
How are you using so little data. Do u just read text and look at limited images?
no kidding
1080p stream ~ 1-2GB/h -> 1TB/mo ~ 16h/day
> I last had a 150GB/month cap when I had ADSL connection
there is no cap, i meant what i said 'typical usage'
> How are you using so little data. Do u just read text and look at limited images?
indeed, we read a lot.
Sounds like an interesting pivot. Can you please share the backstory, if you're okay?
How does Starlink and Amazon's Project Kuiper compare to FSOC in terms of delivering cost effective Internet?
Also, what are the most pressing challenges with a FSOC deployment? I'm guessing line-of-sight issues are a real problem?
5G changes things radically too, I guess, would wifidabba remain competitive in face of that?
Is wifidabba similar to something that https://starry.com is doing?
Is it the same tech Emrod is deploying in New Zealand? https://news.ycombinator.com/item?id=24422897
Thanks and all the best!
As someone passionate about this space, I'll continue to keep an eye on your progress.
Starlink & Kuiper are a totally different ballgame. Their satellites communicate with each other via FSOC, but the end delivery to the customer is a phased array solution. We're using FSOC as the backbone and overhead fiber to the customer premises.
Although 5G is a few years away in India, spectrum sales haven't started and its unclear whether our telecom companies can even afford it given the level of debt the industry already has. That being said, we're poised to be an enabler of 5G once it does arrive because all those 5G small cells are going to require much more backhaul than they currently have. Less than 30% of the mobile phone towers in India right now have fiber backhaul, that situation is only going to get worse when 5G arrives, so we see it as an opportunity to be a backhaul provider for 5G services.
Starry.com is using millimetre waves in the radio spectrum, whereas we're using lasers. The big difference is in India the 5G spectrum is not for public use as of yet, the big advantage of lasers is that they use unlicensed free space so there's no spectrum charges that apply.
https://www.youtube.com/watch?time_continue=25&v=fT-emvifEl0...
> Minimum guaranteed predictable revenue > Fully managed including sales & maintenance > Includes hardware, software & team