Osman Rashid: The Extraordinary Tech Entrepreneur

Osman Rashid is a seasoned entrepreneur in the field of educational technology. Based in Silicon Valley, he is currently the CEO of Convo Corp, an enterprise collaboration company delivering solutions for very large companies, and Co-Founder & CEO of SOAR STEM Schools, a Pakistani private school system preparing a next generation that has the skills to handle jobs that we can’t even think about today. SOAR is disrupting education in Pakistan by delivering actual concept-based learning to many segments of society at affordable price points. SOAR’s franchise known as The STEM School is now bringing STEM education to the masses through inquiry-based learning that can be taught to any child.

Previously he was the co-founder and CEO of online textbook rental leader Chegg (NYSE:CHGG) until early 2010, and also co-founder and CEO of Kno, Inc., a digital education platform company, acquired by Intel in 2013.

He is also on the Board of Trustees for a health-focused non-profit, ChildLife Foundation, which provides urgent care to the poorest in Karachi, Pakistan. CLF runs Karachi’s largest children emergency rooms and is deploying satellite urgent care centers to provide critical care and prevention education. Osman has received several honors, including Ernst & Young’s Entrepreneur of The Year Award (CA) in 2009, which is the world’s most prestigious business award for entrepreneurs, as well as Forbes Impact 15 for 2012 and Inc.’s Immigrant Edge: 9 Wildly Successful Entrepreneurs.

Arzish Azam, CEO Ejad Labs and Director Startup Grind Pakistan conducted a virtual fireside chat with Osman Rashid where he talks about his early years; finding one’s passion; finding problems to solve when building startups like Chegg, Kno and Galaxyz; bringing the next generation communication experience to Pakistan with Convo; digital transformation in Pakistan; remote work opportunities post-COVID and the entrepreneurial landscape.

The Early Years: Transition from Pakistan to the US

“I’m a product of Islamabad so to speak and my father was a diplomat, so he lived in the UK, Africa and I moved with him — I was born in London and then I was with him when he was posted in Africa. That had a big impact on me growing up because of the different cultural experiences. I’m a believer that entrepreneurs are made, not born, so if you sit back and think about it, all the major life events transform you into who you are — in my case, it was exposure to different cultures while growing up. Most of my schooling was done in Islamabad — I went to Islamabad College for Boys right by Covered Market. After my F.Sc, I came to the US to do my undergrad in electrical engineering. It was like a complete change of mindset in terms of learning. The process of me growing up in Islamabad and then the decision to move to the US to study, all of that reflects the kind of attitude that should be encouraged in kids to enable them to take more risks and allow them to adapt to situations. I tell parents that if a kid is getting good grades, encourage them to take risks and if a kid is naughty, understand that they might be onto something. If parents really start to look at things when kids are growing up, they don’t really have to worry about a lot because the kids would figure things out, they just need some scaffolding to get them there.”

The transition from Pakistan to the US was a very interesting one for Osman from a cultural as well as educational perspective. “I had a couple of friends from ICB who had also come to Minnesota. I had a really good friend who was already there and he forgot to mention how cold it gets — during my first winter, there were inches of snow like I had never seen before. However, the biggest change was not the cold or the environment, but the education — that’s where I got the real shock. Everything you did mattered and it mattered right away. It wasn’t like in Pakistan where you could study at the last minute before exams. You had to be on top of everything, which took a little getting used to.”

While moving to the US to study, Osman had decided that he won’t ask his parents for any money and would do it on his own. “This meant I had to get a job. Back in the 80s, one wasn’t gathering any skills during education and I had moved from Islamabad where one used to hang around with friends during all the free time. Finding a job was a really challenging experience in the beginning because I didn’t have a lot of skills. So, my first job was that of a janitor; I used to clean bathrooms at the Student Union. One of my biggest learning experiences was that it was something I didn’t want to do and I decided to do it anyway and it taught me that if I can clean a bathroom, I can do anything in life. That’s when my personal confidence started to go up and I started to believe that I could make anything happen. From there, I got a programming job because I picked up programming during the first few terms at university and I was able to have enough programming skills to keep that job until I graduated from university. So, the whole experience was incredible. During that time, I also became the President for the Pakistan Student Association for a short while, which was also helpful in getting the experience of organizing things, getting funding, motivating people to help out for free, how to get the support of people. From the beginning, I had worked with startups — my first internship was with a startup that worked in hardware engineering making new kinds of LEDs. From there, I joined another startup as a product manager.”

How Chegg came to be

Since the beginning, Osman’s experience has been with starting ventures that focused on learning and education. “Most successful startups begin when you’re passionate about something and are trying to solve a problem. I tell people not to do startups, but solve a problem and startups happen on the way while you’re solving that problem. For me, it’s always been about thinking if I really feel passionate about a problem. Coming to the US, being students, paying almost a hundred and fifty dollars for a textbook was really painful for us. You’d buy the textbook and use it for 10 weeks give it back and they’d give you 20–30% of the money you had originally spent. When we started Chegg, which was 6–7 years after my professional journey had started, when we got into it, we realized that the problem had gotten even worse than it was before. Books were now twice as expensive and all the universities were in the business of making money from books. We thought about disrupting that. We looked at the market and at what was going on. We were lucky that in those days, Netflix has started to take off and the concept of renting a DVD on the Internet and having it shipped, was gathering pace. We wanted to apply the same concept to renting a textbook — that people would use it and send it back and it would be much cheaper as compared to buying and keeping a book. You have to be passionate about what you’re trying to do; there is a right place and a right time. People had tried to apply the same idea in 1999 and 2000, but they had failed because, at that time, the technologies available did not make it easy. When we did it in 2005, it was the right time and the right place and passion also makes your chances of success higher.

Osman quit Chegg in 2010 and started another company — “I had worked with an enterprise startup in the beginning. I created a company of my own as well but I shut it down. During this whole time, I was learning how to build and market a product and also learning about myself. I always realized there are two kinds of CEOs. One is a builder and the other is the one who can maintain it and take it to the next level. I find myself really enjoying the earlier part of the startup world more. At Chegg, when I left, we had more than 350 million dollars in revenue and we were up to 700 people. I found that I had become passionate about it and Chegg had a specific journey and path of disrupting the space that I had become really passionate about. Many entrepreneurs get in the way of the success of their company — Chegg today is worth 8 million dollars, we hired a CEO who is a brilliant guy and is responsible for building big companies, which is his superpower. For me, it was more about building the company to a certain level and then bring in the right management team to take it forward. After 11 years, I decided to look at my job the way I do at any other executive — yes, I could probably do it, but there was someone better out there who could make it smooth for the employees, shareholders, and partners and I believed that we should get that guy to do it. I decided to transition — I decided to stay on the board for a year. Founders are always hands-on and I knew that in order for this to work, I needed to step aside.”

Building Kno, the Company acquired by Intel

After Chegg, Osman started Kno, which got acquired by Intel later on. We ask him if that was his intention when he started out with building Kno. “With the advent of the smartphone, with Apple doing such a great job with the iPhone, we really started to think where this would go? We started thinking about kids carrying 25 pounds of textbooks in their bags, which didn’t make any sense, we thought why not come up with a platform which has the content and the textbook on a single device, which is very user-friendly. The goal was to think about how to solve this — for almost 18 months, we worked on creating a physical tablet, with a textbook on one side and you could take notes on the other side. The iPad hadn’t been announced at that time. We had made the hardware and the app and had done partnerships with the publishers. We got the product together and then the iPad was announced. With all the marketing going on, it was all about the iPad. So, we thought we wanted our product to be on every platform instead of being only on our hardware. That was the time when Intel became an investor to help us work on the hardware and on national level deployment in the Asia Pacific and Europe. We really wanted it to be part of that platform and so Intel acquired all the patents and incorporated it into their platform. When you begin building a startup, building it for acquisition is different from building it for an IPO. When you’re building a company for an acquisition, you’re limiting your thinking. So, I never ever think about acquisition and if it comes, it is the fiduciary responsibility of the board to take a look at it and be pragmatic about it — see where you’re heading and then decide what you want to do, but you don’t set out to do it, don’t establish it with that notion because you will increase your odds of failing.”

Failures and Lessons Learned

“My first failure happened when I had moved to Silicon Valley — I had the notion that people don’t need to have their servers installed in their offices, they should have a button on their website more of a SaaS product — we had built one with a team and co-founder. I shut it down because I discovered that I wasn’t getting along with my co-founder. That’s when I decided to return that money to investors because it turned out that my co-founder was working on 6–7 different ideas instead of focusing on one, which is what you need to do when you’re working on an idea in the beginning. We were a small startup and needed him to be focused to deal with any issues that arose for the customers. That’s when I decided that it’s very important to have someone you can talk to when solving problems. One of the benefits of having a co-founder is that you have tough days and you need someone to talk to and to understand the pain that you’re going through. That’s how you can come up with many solutions. There’s an important lesson in Michael Jordan’s saying, “90% of my shots failed”. Failure is there, but what you take away from it for the next time and not repeat the mistake is the important takeaway. In Pakistan, it’s a taboo that a company failed — it fails, it happens and you keep trying, the winners are the ones who keep trying and get it right eventually. There are very few people who are able to get something right in the very first shot. Failure is only a stepping stone and part of your evolution, so don’t let it define you. At the end of the day, what matters eventually is your health, your resources, a loving family. All the revenue you’re building, do it with honesty, be passionate about it and it won’t be work. I don’t see startups as work. I just enjoy it.”

Galaxyz: The STEM School Project

When Osman started Galaxyz, the idea was to create a product for primary students, enabling them to love science and technology — “I firmly believe that a kid’s direction needs to be set at the elementary level to determine how the brain develops. Galaxyz has now become the source school system that we’re introducing in Pakistan. The notion behind Galaxyz was that when I got into education, I noticed that kids were shying away from science and technology. I realized that if kids have the right mindset, they can choose to be doctors, artists, engineers whatever they want to be. How does one go about setting them up in a way that none of these doors are closed for them? Science works with your brain in a way that it makes you think logically and develops a problem-solving approach and that was what we wanted to do. I would say that the process of developing Galaxyz was a hit and a miss. It was a hit in a way that when parents were using it, they enjoyed it, and parents saw a change in their children. What we realized was that no matter how much we tried, not enough parents cared about their children getting into science to the extent that they would feel the need to come and say that we want to use this application. So, when we started to work with schools, we realized that in many cases the teachers were so busy managing a class that they did not have the incentive or time to try something new on them unless they were forced to. So, another look at the problem, we realized that we wanted to control the whole stack. We wanted to control the environment and have schools and build a system that focused on STEM. That’s how Galaxyz turned into STEM schools. I have a co-founder in Pakistan, Dr. Shazia Khan, based in Lahore, who is an amazing woman. She’s an educator and so, she’s the real force behind the school. She decides the curriculum and how the schools will be run. We jointly work on the STEM aspect because we believe that science and tech need to be incorporated in education to prepare for jobs of the future. We’re also soon planning to franchise the STEM school system and we also want to bring this to low-end students.”

Convo: The Next Generation Communication Experience

We ask Osman how he joined Convo, the company that he’s currently associated with. “Faizan and Sabika were the founders of Convo — they built an amazing product, hats off to them. I was a user first and at that time, I fell in love with the product. Later on, I met them and I invested in the company in 2015, so I have been involved with the company for a few years now. The notion behind Convo has been validated especially with work from home culture becoming more interesting than ever before — the notion always was that the way we communicate as individuals is changing at an enterprise level. As consumers, we have started relying less on email and more on social media. Employees have to come into the office and opt for email, which is the formal way of communicating and they have to switch from social media, which is very informal. Especially in the case of a country like Pakistan, where 60% of the population is below 19 when employees come to work and switch between these two modes of communication, the privacy of information becomes a problem. In light of this, the idea was to give people a new way of collaborating inside the company. When you work inside a company, there are two sides of communication — one is your asynchronous communication like email and the other one is more synchronous like chat — the notion was brining both together on a platform which would give you the next generation communication experience.”

“I feel that when convo started it was a little bit ahead of its time and people were not catching up. People initially gravitated more towards chat-like platforms like Slack, but some of Convo’s biggest customers like H&M and CNBC chose us over all other products. Eighteen months ago, it occurred to me that shame on us that we’ve never tried to sell in Pakistan — here is a product designed in Pakistan and used by some of the leading brands and it has never been given a real shot in a country like Pakistan. In light of Pakistan being the fifth largest country according to population and smartphone use exploding, I thought this meant you would need enterprises to serve those consumers. These enterprises will need new forms of communication, so in the next few years, Pakistan will become a major enterprise player. We thought that we have to solve the enterprise problem in Pakistan and instead of having them go to email, let’s allow them to skip email and take them to this next level communication platform. So, we decided to open a cloud in Pakistan at PTCL so that the data for Pakistani companies stays there. Now we have started deploying in major companies in Pakistan and we’re about to make some major announcements in terms of showing the growth of the product not just in Pakistan, but also globally. I’m very excited about the potential in Pakistan.”

Digital Transformation in Pakistan

COVID has forced the hand of every executive in Pakistan in terms of what to do when it comes to digital transformation in the country. “When I first arrived, I noticed that every executive was talking about it, trying to figure it out. They were trying to get budgets approved; I observed that some of the people were facing difficulties with their boards — digital transformation helps with cost reduction, increased productivity and the focus of many companies is on revenue growth. If you look at a lot of countries across the world, the productivity gain is a long-term essential. Revenue can come and go, as observed from this COVID situation, but if you’re really productive, you really know how to manage your costs, you are more likely to survive. From this situation, we have seen that boards are beginning to see how we can do more with less, how can we be more efficient and productive. All these things are now becoming a part of executive decisions — people really need to prepare their companies for the next 12–18 months, as there’s probably going to be a second wave of the virus and it’s going to impact your company so plan according to that. Think if you’re set up for a second wave. History of Spanish flu also shows that the first wave was smaller compared to the second wave. The second thing is that people are looking at productivity gains. Our conversations have greatly increased with a number of organizations in terms of what they want to do. Just chatting back and forth is not how you get work done, you can’t focus on your work, so if you really look at it, it’s asynchronous work, you’re putting thought into it and it’s being done over time. It’s not instantaneous. This is going to propel Pakistan’s digital transformation in a big way. We may have gained two to three years to this point that organizations have taken and now they’re leapfrogging.”

We bring up the role of the Pakistani diaspora in bringing about digital transformation and development in Pakistan and how Pakistan can engage better with the diaspora — Osman shares his views, “I would say that the onus is on the entrepreneurs and it’s time to give back. As you become successful, you take a step back and ask how you can create more impact. It becomes more about impact. My question to entrepreneurs is how many could say that they influenced the direction of the 6th largest country by population — it is a tremendous opportunity and I feel that Pakistan needs a lot of investment (not just in terms of money) and handholding. There’s a lot of incredible Pakistani talent out there and there are a lot of people who have spent years doing amazing things — from the perspective of DNA, we’ve got it. You have to practice it and stick with it and learn to do the hard thing. It also comes down to the fact that great companies are not built just by founders, but everyone working there needs to work hard. I tell everyone at my company from Quality Assurance to Customer Representatives that they play a role and if they don’t pay attention, they can miss out on details because of which a sales contract might be lost. Entrepreneurs need to get these values across to their teams. That can happen by engaging in a deep fashion with companies in Pakistan.”

“If you look at Indians, Americans, Chinese, Koreans, and Japanese, they all put effort into their countries and helped their countries get to the next level. Even in the US, 50% of new jobs created were by entrepreneurs, it’s not the big companies which will give job opportunities in Pakistan there’s only so much they can do, but it’s going to be the wave after wave of startups, which is going to create these opportunities. What Pakistan has to do is really give Pakistani-made products a real chance, India did it, China and the US did it. We shouldn’t be brand worshippers — there are amazing products being built in Pakistan. You have to give them a shot and that’s how you will help the ecosystem and eventually, the ecosystem will help you. It has to be a product of merit. This way, more people will get hired, trained to be employed and more hiring will be done in the future. This is a cycle, so it’s very important for CXOs to get a grasp of this notion — believe that they have to give Pakistani products a chance, given there’s quality. It’s not just the government’s responsibility, but the businesses have to embrace it.”

Entrepreneurial Landscape

While we have companies like convo, Careem, Zameen which were built in Pakistan, a lot of Pakistanis are not aware that these companies have Pakistani roots. It is important to highlight these stories to motivate CXOs in the public and private sectors to choose Pakistani products that fit the merit. Osman adds, “Pakistani government is trying to make the right moves. I was exchanging messages with the CIO of SECP. They just announced a bunch of things that help you build a company in Pakistan. Before this, you could not give stock options to your employees, you could only give shares and once you do that, the company is gone. This is going to motivate employees into thinking that they can be a part of the success of the company. In the Us, many millionaires have emerged from startups without being the founders, but by working with companies for long periods of time. The entire ecosystem is now coming together and it’s a very important move. It will take a little bit of time for Pakistani entrepreneurs to understand this because the common approach is that I want to keep 100% — this can’t be. Unless you motivate employees to take ownership of the company, success is difficult.”

COVID-19: Work from Home and Remote Working Opportunities

During the current COVID-19 crisis, workplaces are changing. We discuss the resulting changes with Osman and how this will affect the hiring practices of tech companies in the future. “It’s definitely been a big change and these are crazy times. The interesting thing is that there are many people here in Silicon Valley who were not big believers of working from home because there were some big experiments that failed. COVID has really helped us figure out how to be productive. It has made everyone realize that even while they’re at home, they’re still responsible for their deadlines. The way people approached it has changed, which has been a big positive. I’ve always been more of a let’s get on a whiteboard and draw it out kind of guy, so it has been somewhat a challenge for me, so I’ve been working through that. I’ve been getting through the multiple video calls with multiple people; it’s been an adjustment. If entrepreneurs don’t adjust who else would? it’s a part of the game and we have to brace it and roll with the punches, so to speak.”

Talking about increasing remote work opportunities, Osman highlights, “If I look back at the past few months, I would say that with a lot of changes, we have done pretty well in terms of trying to maintain our productivity. If anything, it has emboldened us to say that if there is a wonderful developer in Gujranwala, we should totally hire him. We should not have to ask him to relocate. For us, the experiment has been eye-opening in terms of the possibilities of expanding the team even across Pakistan whether it’s technical or non-technical people. We’re learning how to manage work from home, even the managers. In the past, work from home used to mean that there’s some work going on, but not mostly. That’s the perception, which has now completely changed because people now understand what it means, which is great for anyone in a remote location because now you can work with talent no matter where they’re from. So, I think this is a great opportunity.”

New Patterns Emerging

We also discuss how the supply chain is going to become digitized — “the response does we have trucks and ships that are automated. Do we have more robotics? The notion people have is that if AI and robotics come, we’re going to lose our jobs. If you look at history, you will see that whenever new technology has come in, there have been more jobs. There’s going to be a lot more automation. For example, in the US, they need 50,000 truck drivers. I don’t see teachers becoming replaced. If there are more robots, you would need more people to service them. There are going to be more areas and productivity gain is going to increase. So, I think there’s going to be an overall positive impact and I see certain patterns emerging, for example, new business models and innovation; preparation for the next wave; embrace from the things around you; only certain people will work from home.”

Word of Advice

Osman leaves us with incredible advice, which can prove very useful for entrepreneurs going through tough times. “Times are tough and it’s not easy to be positive. I will tell you that you always have to look for the silver lining. As entrepreneurs, by nature, we have to look for the silver lining because that is what gets us through the day. Building startups is hard. It’s like waking up full of hope, the day beats you down, you go back to bed and the next day you wake up full of hope again; it’s a cycle. What you should do is think of it as climbing a mountain. Don’t think of the peak, think of the next ridge and how you’re going to get there. Focus on the positives and the silver lining. Talk to people; spend time with other entrepreneurs; if you’re struggling, don’t be embarrassed to talk about it. The other guy might be going through the same thing. As you hear yourself and other people talk, you come up with solutions.”

This article is derived from the virtual fireside chat hosted by Arzish Azam with Osman Rashid on May 8, 2020 and transcribed by Shehab Farrukh Niazi, Editor in Chief Startup Guide Pakistan. You can view the original video on facebook.