Ask any VC to list a few good investments in Indian tech sector. Invariably, you will come out with a list of companies that are doing something or the other in the CRM space. In fact, among the over-hyped dotcoms and pre-product techie start-ups in the area of carrier network equipment, the CRM service (eCRM to be more correct) companies are the silver lining in the dark cloud of failed investments for most VCs.

Our story actually begins there. As we looked at the market closely, we found that all the companies providing/planning to provide customer interaction services can be divided into three broad categories. In Category I, we placed corporate houses which have announced plans to set up contact centres of sizes varying from 500 to 5000 seats, but few have gone beyond the announcement stage. In Category II, we placed companies set up by professionals, funded by VCs, and typically started with the email/web based services. In Category III, we have the rest. Call them small businesses if you like, but based on our reading from the emails and telephone calls we receive, they can loosely be described as "anyone who thinks he can invest Rs 10 crore." It is in this category that 80 percent of the companies fall.

And we found that almost all companies in category II (see the table The Professionals) are doing brisk business. While Daksh, Transworks, and eXL are adding new facilities, Tracmail and vCustomer have already done so. Spectramind already has a big facility.

The reason for their success is simple. Most of them are fairly focused and are good in processes as founders come from related industries. Most of them are also extremely strong in international marketing, thanks to their professional contacts in the US. Also, being more aware, most of them decided to go for the seemingly low revenue generating email/web chat. Though the per seat per hour charge is lower in email/chat, the low cost of setup and running and high volumes have more than compensated for that, resulting in a high margin in percentage, if not dollar terms.

Today, these companies account for about 70 percent of the business to India. Among themselves, they have an equipped capacity of 5000 seats out of which about half are live. Though for the majority, the utilisation is one shift, there are projects which have a round-the-clock utilisation.

Among the Category I (corporates), few have started their operations. Notable exceptions are Global Telesystems and ienergizer, the Phoenix group venture. Hero Corporate Services, which acquired a stake in First Ring, is the other name that one can count among those who have started. While Jindal Transworld, a Jindal Group company is ready with its facilities, the other one which is going ahead almost smoothly is TCS-HDFC promoted Intelenet Global. Most others are just ideas.

However, do not count them out. Big corporations are a little slow. But this is no dotcom business. If they are good—as one is sure some of them will be—they can still rake in good business. Many of them are good learners and good process managers. Voice&Data believes that a few of them will do significant business in the next fiscal.

The third active category then, almost non-existent today, will be the US based outsourced contact centre companies. Many of them like Convergys and Sitel are opening their facilities now. A few others are doing preliminary pilots and exploration. Quite a few of them will come here, thanks to the cost-cutting drive in the US.

And together, that means a vibrant, high-growth business. Who says things are bad in India?