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CEO finds success with searches

Crisp attire and a smooth manner are but accessories for Manjeet Dhariwal. With poise as distinguished as his, one expects a title more stately than CEO-diplomat maybe or colonel.
Colleagues and friends call him charming-a gentleman, they say. But the reason for his early success is not that. Exclamations over his intelligence, energy and keen problem-solving skills point to the more likely reasons.
Dhariwal, 34, co-founded Netsmartz Group here in 1999 when he was 26. The software development company has multiplied its offerings and grown to more than 50 staffers in Rochester and 370 employees at the company’s offices in India. Construction in India is wrapping up on a 100,000-square-foot facility to handle Netsmartz’ 70 percent year-over-year growth rate. Dhariwal declined to disclose the firm’s revenues.
In three years, Netsmartz is expected to have more than 1,000 employees, mainly in India. Its new building there will accommodate up to 800 employees. It is located a mile and a half away from the old office, a 25,000-square-foot facility, where business is running in two shifts to keep up with the increased spending in Netsmartz’ key niche, search engine optimization.
SEO businesses work to increase traffic to their customers’ Web sites through higher ranking Web search results in engines such as Google and Yahoo. The SEO offering was the most recent addition to Netsmartz’ offerings and the most promising.
Netsmartz is the parent group that comprises two companies: U.S.-based Netsmartz LLC, founded in 1999, now with 52 employees, and India-based Sebiz Infotech Pvt. Ltd., formed in 2001, and now with 370 employees.

Global upbringing

Dhariwal, commonly known as Jack, has spent much of his life in Rochester, first at Rochester Institute of Technology, where he earned a bachelor’s degree in computer engineering, and then at the Simon Graduate School of Business at the University of Rochester, where he received his MBA.
Dhariwal was born in India and lived there until he was 7, when his family moved to Africa. Growing up in Tanzania gave him an opportunity to broaden his perspective from experiences with different nationalities, cultures and languages.
He attended an international school, where his teachers were American and the students represented 30 other nationalities. By the time he moved to New York to attend RIT, he spoke seven languages fluently.
High school opened his eyes and his thought processes to diversity, he says. It gave him an advantage, which has helped propel him on fast forward. It is kind of his style.
Dhariwal started Netsmartz after a five-year career at Frontier Corp., where he worked with product manager Kevin Bates. They met in 1997 as they worked on deploying Frontier’s national dial-up Internet service.
Bates describes Dhariwal as sharp and able to find solutions for multiple, complex problems. He recalls Dhariwal once took on an extra project for Bates that meant developing a software system to make sense of a series of raw data streams. Dhariwal was able to accomplish that in addition to the rest of his workload, Bates says.
“In all the years I’ve known him, I’ve never seen him lose his sense of humor or his sense of calm,” Bates says.
Dhariwal is a gentleman, Bates adds. “He’s always calm, cool and collected.”
Dhariwal says he started his own business not out of any burning desire but because he saw an opportunity to develop software for business functions. It started as an experiment to see if he could succeed. It turned into a challenge, especially in the early years as IT spending slowed and many IT startups closed.
“In the very beginning, the focus was software development,” Dhariwal says. “The majority of clients were telecom companies, where we were doing processing systems, and as the company grew, we diversified into two other segments: one being search engine marketing and the second being e-learning.
“As we stand today in 2007, we’re looking at the fact that the software development portion of the business is probably going to stabilize where it is at, but we’re going to see a lot of growth in both e-learning and search engine marketing.”

In search of

The latter was an offering the company began to develop over the course of trying to sell its software to consumers online. That is when Netsmartz began to understand the importance of search rankings.
After doing some pay-per-click advertising online, Dhariwal says that to continue it was cost-prohibitive.
In pay-per-click agreements, advertisers pay when a Web user clicks on an ad to visit the advertiser’s Web site. In basic terms, search engines produce two kinds of listings: organic and paid. Paid listings appear in the margins of the page or appear highlighted in the first few listings above the natural-or organic-listings that follow.
Dhariwal and his team quickly saw the better solution for marketing Netsmartz’ software was organic. So the company sent a team to training classes.
“It was a very dispersed knowledge because this is an ever-evolving field,” Dhariwal says. “We gathered some ideas, we understood the domain, and then as we started delving into these practices, we started to see ourselves moving up to the first page (on search engine results). We said, ‘This is great. If we can do it for ourselves we can do it for other people.'”
Netsmartz proceeded to invest in education and process development to perform the same functions for business customers.
The company has been evolving since due to increasing demand from clients who recognize the asset value in a high ranking. A high ranking is arduous to attain.
Those who have tried to improve their own search rankings understand that, Dhariwal says.
“There is an inherent asset that any company creates once it gets good rankings. So it’s not short-term marketing spending. Over time, they’re actually building an asset,” he says.
Improving a ranking cannot be done overnight, he says. People are beginning to understand the time involved in creating the relationships necessary to improve a company’s search relevance for the key words associated with its products or services.
One of the most important criterion in determining whether a link appears on page 10 or page 1 in a Web search result has to do with the number and quality of other Web sites that link to it. Search engines consider those links as votes of confidence, Dhariwal explains.
Google’s success has come from the better quality relevance of its organic search results, which he says is why users switch from other search engines to Google.
“If we walked into a party or a group of people and you introduced me, I have instant credibility, as opposed to introducing myself. So if you said, ‘This person is great,’ well, there’s some instant credibility that comes in,” Dhariwal says.
He continues, “Search engines operate in a similar fashion, in that if other sites link to you with specific key words, they look at that as endorsements, and as a result of that you tend to move higher in those key words because you are more relevant. So, link building service is really the most effective method of moving from a lower to a higher rank.”
It takes at least six months to develop relevant links, which means contacting people running related sites, writing industry-related content and making the site more legitimately relevant to its key words.
Netsmartz officials working out of the Rochester office sit down for a consultative process to identify what those are, generally 30 words, and officials at the India office set about building the links necessary to move a company’s Web site up in its rankings. Monitoring for relevant sites means many hours of labor; developing the contacts requires still more.
“It’s very difficult. Because you’re asking someone else to give you an endorsement, so what we have done is we have databases and databases of people who we’ve dealt with over time, and so we broker that transaction, so we say, ‘You are in this relevant industry, so your endorsement is going to be more effective than someone else; we can do something else for you.’ So we work in that manner,” Dhariwal says.
Ethically sound SEO takes time, he says, but it is the only viable, long-term means of improving rankings.
“Some companies create link farms, where they provide all these Web pages and just give you links. You may get instant gratification and may not, and after that the Web site you are trying to promote will go into this black box that Google calls supplemental index and you’ll never show up,” he adds.
“The biggest challenge is to get someone from a very low rank to a very high rank. That’s where most of the effort goes in.”
The company then recommends a maintenance plan, which is less expensive, but the customer continues to build a few links a month.
“So you’re continuing to do it; over time it just becomes that much more difficult for someone of lower rank to come up and get past you,” Dhariwal says.
Netsmartz’ SEO business has 500 clients, up from 220 last year. Given growth projections, Dhariwal says in three years the company will have 1,000 employees supporting its search engine marketing services.
“If we can service a few hundred clients, definitely we can scale that, and we have the required processes in place to do that,” he says.

A focused leader

Dhariwal is known for his determination and enthusiasm-and his persuasiveness, which friends say serves him in both his personal and professional life.
His friend Kunal Tanwar, practice director at Navint Consulting LLC, says Dhariwal has an overall desire to succeed and do well in his personal life as well.
“The way he is at work is the way he is at home. He has translated that desire to succeed on both fronts. It’s hard for people to do that,” Tanwar says.
“For example, he plays golf, and he wants to be a part of the PGA one day. That’s his desire, OK. I laugh with him-and I laugh at him, because I’m a pretty good friend of his,” Tanwar says.
“But you know, I think he will do it one day. Maybe not the PGA but the Senior PGA,” Tanwar says. The way Dhariwal makes time for accomplishing his goals, Tanwar adds, is making sure the people around him who are affected understand and share the goals.
Even Dhariwal’s wife, Noor, supports his golfing goals, so long as Dhariwal maintains a balance between his commitment to work and family, Tanwar says.
Dhariwal and Noor live in Pittsford. The two met in India in 1999 as Dhariwal was scouting properties for Netsmartz offices there. She often accompanies him back to India to see her parents, whom he says now have the added pleasure of visiting with their daughter, Nyrah, their first child, born last year.
Dhariwal says his approach is simple. If he commits to something, he wants to give it 100 percent.

Aiming for the top

Right now, that passion includes making Netsmartz No. 1 in each of its offerings.
SEO represents roughly 30 percent of total business at Netsmartz, but Dhariwal expects it to grow with its e-learning business to comprise 90 percent of company revenues.
“We don’t push (software development) very hard. We get a lot of word-of-mouth referrals that come in. We’re not pushing that as strongly because we see the energy spent in these two segments has a greater return potential for us,” Dhariwal explains.
E-learning accounts for 20 percent of business at the firm. The segment is focused on converting curriculum into computer-based training. It is transforming instructor-led, classroom-based training for computer users and developing the umbrella process to manage coursework for each user.
Unlike the SEO business, e-learning was a software development niche the company planned to target.
Netsmartz does not design coursework. Instead it works with two companies that specialize in that. Netsmartz writes the software to support it from story boards provided by the partner companies. Dhariwal did not disclose names of the companies.
The team at Netsmartz takes the story board and builds software around it, including a management system, if there is one. In that case, Netsmartz also would design an additional program to manage the coursework, quizzes and scoring for each user.
On the SEO side, Netsmartz works with a dozen Web site design firms by performing SEO services for their clients.
Dhariwal is working with his management team, including partners Manipal Singh, chief operating officer and chief technology officer, and Rohit Bhatia, vice president, to reinforce the groundwork necessary for current and growing demand.
Senior management includes eight people, three of whom-Dhariwal and his partners-are based here.
When he and his partners started Net-smartz in 1999, the decision was to give their startup a two-year chance. If it did not succeed, the plan was to go back to their full-time jobs.
Before that, Dhariwal had worked with Michael Fuqua at Frontier. Dhariwal was jovial, energetic and intelligent and bound for wider pastures, Fuqua says.
Perhaps his youth, he says, has played a part in his determination and his willingness to face risk. Dhariwal seeks advice readily, and that, Fuqua says, has served him well.
Dhariwal and his partners used their own money, instead of turning to venture capital, and are glad to have kept Netsmartz’ growth organic.
“We had no other choice than to be profitable,” Dhariwal recalls. “There were times when it was stressful, when we went without a paycheck for weeks, but we believed in it and said, ‘We think we’re on to something.'”
rbj@rbj.net / 585-546-8303

09/14/07 (C) Rochester Business Journal

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