His track record pretty much speaks for itself – he has been at the helm of OnePlus ever since the brand came to India in 2014. And in this period has made the brand one of the leading players in the premium segment of the smartphone market – seeing off challenges from not just traditional heavyweights like LG, Sony and HTC, but also weathering storms from newer players like Xiaomi and Asus – indeed at the time of writing OnePlus was right alongside the likes of Apple and Samsung in the premium segment in India. And he has managed to do all this without creating too much of a fuss, running a ship that seems more solid than spectacular, even managing blips like the OnePlus 2 and OnePlus X. “Vikas knows what needs to be done,” one of his rival CEOs told us. “And he does it. Most people don’t know the first. Some know the first, but cannot do the second.”
Big business sense from a small town, with a “comic” touch
Some might assume that his business acumen stems from having studied from two of India’s best known educational institutions, but to use a cliché, the business actually runs in his blood. “I come from a place called Bareilly, which is a part of the Bareilly district. It is a bordering town of Uttaranchal and Uttar Pradesh,” he tells us. “I grew up there. I come from a business family. I did my primary schooling in the same town. I was fortunate that I was able to get into the IIT and that’s how I got into all these corporate roles, but otherwise, coming from a business family, that was a natural profession in the town. My father was a cloth merchant. So, we used to deal in wholesale distribution of clothes and then we moved to retail distribution.”
And his business sense came to the fore when he was very young. “During my school and childhood years I used to manage a couple of businesses of my own,” he says. “I used to spend considerable time at the shop, but I also used to run some part-time business. Some small stuff. We used to have these school festivals like Children’s Day, Diwali, etc., where you put up some small stalls. I used to do that. I also used to have my own small library of comics, which I used to distribute in my town for almost I would say six to eight years.” Of course, given the fact that the OnePlus 6 has an Avengers’ Edition, we ask him if he read any comics about the likes of Thor, Iron Man and Captain America. “I think I used to like all comics,” he laughs. “Unfortunately, I was not exposed to the DC and Marvel Universe at that time. You used to get all of those Hindi and regional comics – Diamond Comics, Raj Comics, and Champak. And I used to have pretty much all of them, the entire series from the first edition to the last. That’s how I really got fascinated by the business side because in addition to all that I was also sitting in my father’s shop in my free time or whenever he was traveling. I have seen business management early on. The cost side, the expenses, The labor issue, inventory management. Somehow I got comfortable with all of that.” The world has moved on to DC and Avengers, and the company he heads in India itself has Avengers and Disney tie-ups, but Agarwal still has a soft corner for the comics that got him started. “I still actually sometimes read them whenever I get time,” he confesses. “But it’s been some time. Every once in three years, but I can just go through all of them in once.”
Starting out in finance
But of course, that does not explain how he ended up in the world of technology. As in many cases, it was a bit of an accident. For, Agarwal actually started out in finance. “I am actually a finance professional,” he says. “I am an engineer but I did my MBA later. I graduated from IIT in 2004, and from IIM in 2007. And then I joined a finance company, a private equity firm from Canada where I had most of my professional experience.” Why did he pick finance? Agarwal ponders this for a while and then clarifies: “I did not really pick finance, but I picked private equity. The reason why I chose that company was that you were actually going to act as an owner of the business,” he elaborates. “Private equity basically means you are investing money in businesses, and you are going to manage those businesses. That’s something I really found interesting because you are not going to get those opportunities early on. People will get private equity after working for a decade in the industry and then they start investing and managing businesses. But that’s the benefit that you get in good colleges – in IIMs you have this opportunity to join these kinds of companies early on. I was a fresher there. I was the only analyst in a team of five and I was managing a portfolio for almost, I think, USD 600 million in 2007.” He sees our eyes widen at the figure and smiles. “One of the good things about that job was that I was meeting a lot of senior people, like the owners of all the real estate developers,” he explains. “And in 2007, all these companies were billion-dollar companies.” It was his first experience of “real business.” And he was fascinated.
“Yeah, makes sense”: from finance to tech
Although things were going well in finance, in 2011, Agarwal took his first steps towards the world of technology. “I had this thought of doing something,” he says. “And that’s when the e-commerce was really booming. I had a batchmate who used to work in eBay and he had this thought of starting an e-commerce company. And I thought ‘Yeah, makes sense because the e-commerce seems to be the future.’
In 2011, he left his finance job and started an e-commerce company in Delhi. It was, however, not smooth sailing. “We ran that startup for almost two years. We were based on Delhi, Dwarka. We were profitable, we were growing, but we didn’t really see this as a long term sustainable business, maybe this was a five year- ten-year business but beyond that, we were not very sure,” he recalls. “We didn’t want to do something which we could not run for a very long time. We were not there for making just short-term money. We wanted to create some big business that could add value to the economy, to the industry, someday.” There was also a hint of disapproval at home. “The family wasn’t very comfortable with me running a startup coming from a very well established job to the difficult world of startups,” he laughs. remembers. “The most difficult part was time management. So I kind of decided to take a call to not do it now, and maybe revisit it in the future.” But he was now firmly on the tech side. The next company he joined was the Ibibo Group, although there was a touch of finance to his work. “I was part of the corporate finance team,” he says with a laugh. “I went back to sort of finance that time for a brief moment. But I was actually managing their e-commerce vertical called Tradus. So, for a year or less than a year I was With Ibibo managing their e-commerce vertical traders along with the CEO.” And then in August 2014, he came to know of a new company. It was based in China and had started in April that year. It was called OnePlus.
OnePlus comes…and becomes a second baby
In August OnePlus were looking at India as a potential market. And Agarwal got to know of that through one of the oddest sources: an alumni networks. “I had gone back to my comfortable corporate job. So I started reconnecting with all my friends,” he explains. “I actually activated my alumni group. I was not part of that group till then. So I re-activated that group.” And that was exactly around the time when OnePlus was contacting IIM alumni for posts in India. “I found the OnePlus opportunity through IIM alumni group,” Agarwal recalls. “I read up on OnePlus, what they were doing, how there were trying to differentiate, and I liked what they were trying to do. So I immediately applied and fortunately Carl (Pei) was in India at that time. So, the next day, I actually got to meet Carl.” Things sped along then. “I think it was 14th or 15th of August when I dropped them an email and the next day I actually had a meeting with them,” he tells us. “Within a month we did an interview in China and that’s how it all started. I joined the company in October 2014.” But wasn’t it a big leap of faith to take? Especially after his own less than perfect experience with a startup? “Being in the e-commerce industry, I saw the potential of m-commerce,” Agarwal says. “I was part of the ecosystem and I could see that whatever the future was, the smartphone would always be at the center of the industry. And here I was getting an opportunity to be part of the smartphone industry. Also, OnePlus was a startup. Smartphone is a big player industry, it is not for startups. But somehow OnePlus was a startup in the industry. And I was having this opportunity to be a part of the journey early on.” “It was like a second chance for me,” he says, of his decision to get back into startup mode. “I kind of took that leap of faith. It was a risk because when OnePlus plus was still an unproven business, they were just less than a year old that time. But what I found interesting was that I was going to be part of a technology startup and not just an Indian startup. There is a big difference in how global startups are built and skilled and how Indian startups have been growing. So I was actually going to be part of a global international startup, and that too in a very lucrative industry – an industry which is one of the most critical and which would stay for at least the next 30 years. OnePlus in that 30-year horizon was (and is still) in a very early phase. So that’s what I liked. I was also getting the opportunity to build the brand from scratch. That’s, again, a very rare opportunity!” But perhaps the biggest attraction for him was the chance to work with a truly global player. “I think the exposure itself is a big difference,” Agarwal says. “So Indian markets are always catering to the local market, but a global company will cater to the global audience. That just changes the whole perspective of how the product will be built, how the business will be scaled, and the exposure you will get. I was also looking at the opportunities that you will get from the learning perspective. So I haven’t really seen a lot of Indian startups killing it successfully, the way the global companies have done. I had the opportunity to go abroad twice after IIT and after IIM. I decided to stay there. But I always appreciated how the kind of opportunities you do get outside India. So this was one opportunity, we’re actually getting the best of both worlds and getting a global exposure, global company, global recognition, sort of, and doing it all from India.”
Coincidentally, this was around the time when Agarwal had just become a father. “I took it as a sign that maybe this is a new beginning,” he says with a smile. “So OnePlus has always been like a second baby for me. Both OnePlus and my kid have grown in parallel.”
The OnePlus challenge
Agarwal took the OnePlus plunge at a time when Chinese brands were synonymous with questionable quality and were often viewed with suspicion in India. However, he feels that OnePlus was never really a Chinese brand in the literal sense. “OnePlus from day one was conceptualized as a global company,” he explains. “There are brands who are from China and are trying to expand globally. OnePlus was conceived as a global brand, which was based out of China.” He pauses and thinks and then elaborates further, “If you think of the name that we chose: OnePlus. It’s not a Chinese friendly name. We have never really targeted the Chinese. If you remember, OnePlus sold 1 million units in its first year and a majority of the sales were actually coming from the global market.
“China was just a market for production and where the team was actually based. In fact, we actually had to face a lot of challenges because the team that we built in the beginning, that was all global. We had people from 19 countries in the initial phase for six months who were working for one plus. So it all give us some good understanding of the global markets.” And it was this “global approach” that Agarwal thinks was responsible for the success of the OnePlus One, the first device to come from the company. “So if you remember, the OnePlus One was a very different product compared to what the market was offering at that time,” he points out. “It was quite future proof. It had the best possible, specifications, configuration, design…everything. It was unheard of at that point in time. We sort of disrupted the market and that became the success cornerstone for us.” The success of OnePlus surprised a lot of people, not least because even though it was surprisingly affordably priced for the specs it offers, it was still on the expensive side for a market that was as cost-conscious as India. At a time when Xiaomi had stunned people by bringing in the flagship level Mi 3 at Rs 13,999, the OnePlus One retailed at a relatively higher Rs 21,999. “Premium segment, of course, is the most difficult one to enter,” Agarwal concedes. “That (OnePlus One) was just our first product and we were actually the last enter this industry. If you really look at it, after OnePlus there’s no other major brand has really entered. So despite being a latecomer we were able to disrupt and grow. A lot of companies which were there at that time, today no longer exist. And OnePlus has actually gone from a position of an entrant to a position of strength now.”
The OnePlus success formula – playing the premium segment
But what made the OnePlus One in particular, and OnePlus, in general, such a massive hit among users? Agarwal does not think it was just the price edge that the brand enjoyed. “It is not the price that really matters. It is the value and experience,” he says. “The key reason for the success of any smartphone company is the customer experience that they can provide. The customer is not really paying the price for the product, but is paying for the experience that they are going to get.” Picking up a OnePlus device to stress his point, he continues: “This is a functional product. It is sort of a commoditized product. But it also has a lot of elements around the experience part. So if you’re just looking for the functionality of the phone, you can buy any smartphone today. But if you care about that incremental experience. every time your phone hangs, the experience is impacted. Every time you don’t get the right customer service, your experience is impacted.” It was the stress on experience that made OnePlus move towards the premium segment of the market, even though this was a very tiny segment of the total market. “We decided to enter only the premium segment whereas the market was moving towards mass market,” he remembers. “We decided to focus only online when the market was actually focusing on offline more. Even the online brands were actually going offline.” The brand has never really looked back after that. “It has been going up and up every time. Even till today OnePlus 6, OnePlus 5T, the sales have been higher than all previous launches. Every new launch is setting a new standard,” Agarwal says, with a hint of pride. The lesson he has learned from the experience is simple: “You can go with the market data, that can give you some indication,” he says. “But in a way, the way to look at it is: we are operating in a market which does not have any precedent. We have our own playbook. We are creating our own journey. And we don’t really have any past reference to look for.”
It is a strategy that has yielded the company rich dividends and one that Agarwal says has not much chance of it changing in the coming days. “We still do not have offline, we still don’t operate in multiple product categories, we are still not doing a lot of advertising, we are still not even available on multiple online platforms,” he points out. “With all of those constraints, if people are still buying the product, that means they’re really satisfied with the product.” “So, India, in a way, has always led the way in terms of piloting and experimenting with different concepts. For OnePlus 5, for example, we had big mega launch, offline launch and that worked out really well for us, and learning from that experience we took it to the OnePlus 5T launch where for the first time, the brand launched a product in New York,” he pauses and adds with a smile. “Before that, we used to have YouTube launches!”
“Indians are not price conscious, but value conscious!“
A number of analysts have always been puzzled by the fact at how OnePlus has continued to do well in spite of consistently increasing the prices of its models. In a market like India, which has a reputation of being very price-conscious, price increases are considered to be a one-way route to disaster. OnePlus has bucked that trend right through – to the extent that it today sells its products at a price tag that is more than fifty percent higher than when it started out in 2014. Agarwal’s rationale for this surprising success is simple if against conventional belief – he feels that the Indian consumer is not as price-conscious as many make him or her out to be. “Indians are not always the most price-conscious, they are always value conscious,” he says. “‘If I can spend that extra one rupee, will I get an extra 1.1 value 1.2 value?’ is what they are trying to work out. They are the most rational people, they always try to justify ‘if I’m paying this, can I get enough value for this or not?’ That’s inherent to Indians – that’s how they think of every purchase. I’m trying to get the maximum value irrespective of the cost. If I’m getting more value, I will be willing to pay the extra premium because Indians also do have that money. The second thing is that they think of it from a long term perspective. They do not want to replace a device every year. So if I’m going to look for a device which is going to be used for next two to three years, my device has to be future proof, my device has to deliver on my expectations and should not become outdated in some time. Third, Indians are also brand conscious.” Part of the reason for the success of OnePlus was also timing. By a happy stroke of fortune, the arrival of OnePlus coincided with the relative decline of the Nexus brand in India. “The Nexus used to be a very popular device in India and when the Nexus 5 was discontinued, the Nexus 6 was not the same (it was much more expensive),” Agarwal points out. “That’s when OnePlus came. A lot of customers here do aspire for an Apple or a Samsung and other premium devices, but they do not buy an entry-level device or a cheaper device by choice, they buy it because of probably budgetary constraints. If you aspire for a premium device, then you would probably stretch your budget by X percent, and see what best can you get. I think that’s where OnePlus just fits in really well. We were able to justify the extra cost that you may have to pay for the OnePlus device but you are going to get a disproportionately higher value for the money that you are paying.” It kind of ties back to how value-conscious Indian customers are. “India is quite a tech savvy country. It is known as the IT hub of the world, they really knew what OnePlus is and that’s why they probably preferred OnePlus,” he points out. “It is not as strong outside India, despite the purchasing power being much higher in those countries. The US and Europe can easily afford OnePlus but the penetration is not as strong and that’s why India becomes more important for us.”
Not always smooth sailing – l’affaire OnePlus X
Of course, the going was not always smooth. There were blips and perhaps the most notable was the OnePlus X, a smaller, lesser priced variant that in spite of a very eye catching design (it was one of the first devices to use ceramic), did not do quite as well as expected. “We were getting a lot of requests where people do want to have a device in a slightly more affordable price,” Agarwal recalls. “And we tried to innovate and come back with as competent device as we could but the learning from that experiment was that people are not buying OnePlus because they want to buy an X-priced device. They want to buy one because it offers a flagship experience. We took that feedback that our community of users is not going after the price. They’re going after the flagship experience.” He also feels that the OnePlus X contributed to the OnePlus 2 being a bit below par. “The OnePlus 2 was not as successful device as other editions,” he points out. “And one of the reasons was probably that we were also developing OnePlus X parallely. So we were probably not able to do enough justice to the flagship one. And that probably let some gaps.” The experience was a chastening one. But Agarwal is firm that OnePlus has learned its lesson. “We decided to stay away from any mid-tier device and focus only on the premium. Now we put all our eggs in one basket, one flagship a year and it has to be better,” he stresses. Which is not to say that he rules out moving into other price, and indeed, other product segments (OnePlus TV is very much on the horizon even as this is being written). “If there is a significant use case, we can always enter them,” he says, but the main focus remains smartphones. “The smartphone brands who will survive this phase are going to be there for next 10-20 years,” he says. “This industry is highly, highly competitive. The competition is not from small brands, but from cash rich, very aggressive global international brands. We have seen how a lot of Indians brands have almost ceased to exist in the market today. Even in China, the brands which are surviving today are different from what they were three years back. As a company, we are not very ambitious in our expectations. Our focus is, just in the premium segment. We want to be the best choice for our customers. “If somebody’s looking to buy a premium smartphone, the first thing that he or she should think about is OnePlus. It is a simple expectation that we have,” he concludes.
Keeping Android clean…and working on service
It started out with Cyanogen as its OS, but with the OnePlus 2, the brand moved to its own interface, called Oxygen OS. An OS that is incredibly uncluttered and very similar to stock Android. Its similarity to stock Android is totally deliberated, according to Agarwal. “That’s by design,” he explains. “We have our own take and If you go back to the original OnePlus One philosophy, the company was started because we wanted to develop devices that we would like to use ourselves. OnePlus is a company that represents a group of individuals who think likewise. There are actually a few things we can do that can further enhance your stock Android experience. So it will of course always stay close to stock Android but there can be some nifty enhancements that are likely to make your experience better.” He pauses and sums up: “It is always the incremental delta that you make which will make you better than the standard.”
When minus work at OnePlus…
So what does Vikas Agarwal do when not in OnePlus mode? “I would say I work a lot,” he stresses right away. “So there’s limited time for anything else…” When pressed a little, he says, “I read. I do read a lot of blogs. I like books. I like to look for some inspiration, some learning from the books, that’s why I don’t really read fiction a lot. I read a lot of biographies. I do listen to a lot of podcasts, and TED talks and all. I spend a lot of time with my kid now. The first two years there was a trade off and I didn’t give enough attention to the family but now I think the company has grown and is much more balanced.” He also is not averse to watching TV series. Although he is notorious for not watching in sequence. “I am very patient and a very tolerant guy. I sort of wait for the right moment. And then I sort of clear up the backlog,” he explains with a laugh. “For example, like Game of Thrones. I didn’t watch the first five, six seasons. I watched it this year and I watched the entire seasons at a stretch and I didn’t want to wait for the entire season.” He also watches films, but prefers watching them on television, and is not really a movie enthusiast. “So I don’t watch a lot of movies outside. I don’t go out. I wait for them to come on TV or when I’m flying or whenever I get time. Flying is when I actually really catch up with all my movies,” he explains. “I think I can say watch them. But it is not that I really care for watching them. If I get time, and if it is coming, I can just watch but it’s not that I really look towards watching movies. I don’t really wait for this movie or that movie. I can watch the same movie ten times also. Whatever is coming, I can just watch.” But what he really looks for are opportunities to learn. “It is a limited time and I’m trying to make the most of it. I try to look for inspiration, look for ways that can help me in my own challenge, whenever I can,” he says. “The thing that I really look forward to is these blogs and experiences that I can learn from different people or different ways. I read a lot of things on Medium, Quora…there is this one guy from Dehradun who is actually writing a blog about the life experiences that he’s learning from different people. I really liked what he is trying to do. He must be 20-22. I really find it very interesting and inspiring. I also think of doing something similar, but he’s actually doing it which very commendable.” When it comes to food, Agarwal has clear preferences. “It has to be North Indian,” he insists. “I’m from north India, so for me all the north Indian dishes are good.” Does he have any favorite dish? “I would say, this one probably would be aloo paranthas,” he says. That said, he is cutting down on heavy eating. “These days I have stopped taking all of those traditional delicacies. It is not a healthy lifestyle, I would say,” he says.”I’m trying to figure out that part. I’m experimenting with different food options. I try everything…” He thinks, and then adds, as our interaction ends: “These days Subway has become one of my favorites.” Of course, he walks us to the exit. He may have come a long way, but he remains the quiet boy from Bareilly.
OnePlus’ Clark Kent!
Indeed, when he goes home to Bareilly, Vikas Agarwal will still check his collection of comic books. The ones that got him started on the road that led to OnePlus. He is a man who does not forget where he came from. Perhaps the greatest example of this was seen on the phone he tends to use. While many would go for a high-end variant or a special edition, Agarwal prefers to use the plainest option. Because that is the one most people use. Some people want to be Superman. Vikas Agarwal is content being Clark Kent. But underestimate him at your peril. For, without him, Superman wouldn’t exist. (Nimish Dubey contributed to this post.)
