- I owe my success to The grace of God!
- Eternally grateful to My family for their unconditional support
- Most embarrassing moment Not knowing if I’d make it to class VIII after the final exams in class VII
- Most admired trait Hard work and truthfulness
- Most inspiring phrase Act such that your principle/action is an example for others
- Most important decision To move to Mumbai after college in Chennai
- My best friend My wife, when she is in a good mood!
- Men whose advice I sought Dad and Prem Watsa
- Sleepless nights Every night before a flight!
- Success means Being able to do what you want
- Greatest gratification Seeing so many colleagues at work doing so well over 20 years!
- Most relaxed With music on weekends
- Favourite book Doctor Zhivago by Boris Pasternak
- Favourite drink Jack Daniels
- Favourite song Landslide by Fleetwood Mac
- Best days of my life Evenings out with family and friends
- Advice to my daughter Do what makes you happy
- My dream now To set up a not-for-profit hospital chain
Shakespeare certainly didn’t have me in mind when he wrote – “There is a tide in the affairs of men. Which, taken at the flood, leads on to fortune.” The only tidal connection that I happened to have is Madras, the city I grew up in, but the seashore was about 12 kilometres away. It just so happened that life turned out that way.
I grew up in Anna Nagar. Along with me, our 1,200 square feet, two bedroom house accommodated my parents and my younger sister. My parents were first generation immigrants to the city. My dad studied at Madras Christian College and took up a job at Dunlop Tyres. Those days Dunlop was a thriving tyre manufacturing company. They had a great tagline too – ‘Dunlop is Dunlop, Always Ahead’. Maybe my dad did believe that and, that’s the only job he ever took up. So, he had one job, one company, one boss, one wife, one car… all his life, almost nothing changed for him.
Growing up, the best gift that I got from my parents was work ethic and education. They were disciplinarians and inculcated the reading habit in me. Right from the age of nine, I used to read the newspaper every day, religiously.
I wasn’t a particularly bright student though, in my early years, at Don Bosco. Debating I was good at, maybe because I enjoyed it, and was even the captain of the winning school team. Quizzing was another love. But what I liked most about my school was that there were no favourites; all were equals. Even though I was not among the top 5% academically, nobody shooed me away from participating in extra-curricular activities such as debates or quizzes.
That inclusivity was responsible for the success of many students and leading from the front was Headmaster Selvadurai, a class act with his clipped English. His effort was to make us gentleman out of ruffians and he treated each one of us like somebody who could achieve something but needed some help to get there. He always did that, with the occasional ribbing. So, if you wore glasses and you took it off and still kept looking at him, he would say, “get your glasses on. I can’t see you”. And you would never meet anybody from our class who had a bad word for him, whatever the punishment he meted out to them. That was a fantastic attribute to have. Imagine at the workplace, if people left every feedback meeting convinced that the organisation is trying to find a way for them to achieve their potential rather than find fault. The other teacher who left an impact was Mrs. Mathen, who was the epitome of humility. She always advised us to stay grounded and to never carry a chip on your shoulder. She was inspiring.
***
Given the warmth around, I made friends easily. There was Sarath, Sandeep, Roshan, Ajit and Ashok. All of them still remain my best friends. These relationships go back to 1976 when I was in Class III. We grew up learning the ways of life, went for tuitions together, studied together, went for school trips, got ragged in first year of college together, tried a smoke for the first time together and had our first drink together.
Sarath and I have had a parallel journey for a long time. We studied in Don Bosco and Loyola together. He did his post graduation in the US and I went to Madras School of Social Work. We both started our careers as trainees in Bombay in 1990. Around 1999, he became an entrepreneur and I in 2000. Our conversations are unguarded. Even today, it’s very difficult for us to address each other by name. It is ‘ennada, va da’, even at board meetings. We crack the silliest of jokes and laugh. Others might wonder – what’s so funny? I don’t think we’ve ever said ‘thanks’ to each other for anything. If we do something for each other, the other thinks its par for the course.
Then, there is Sandeep. Phone conversations with him are never less than 45 minutes. Every time we get together with the rest of the guys, it’s always a late-night session. With some of them, I even co-invest. When you co-invest with somebody whom you have known for 45 years, economic interest is secondary. The primary interest is to find time and do things together. You enjoy the moment, the journey and return on investment is a derivative.
Our get-togethers always remind me of a wealth management company’s ad that I read in a European magazine. It showed four or five friends sitting around a tent in a desert ambiance, smoking a hookah, chatting and dining. The tagline went – ‘Old Friends, New Stories. What’s money got to do with it?’
***
After finishing my schooling at Don Bosco, Loyola College was where I headed next. Along with familiarising myself with the laws of demand and supply, I also started developing a keen ear for music. Peer group influence fuelled love for bands and performers as diverse as Pink Floyd, Dire Straits, Barclay James Harvest, Whitesnake, Metallica, Neil Diamond and Michael Jackson. Special revere was reserved for Simon & Garfunkel, because their music was simple yet there was complexity in the message. Bob Dylan got love, too, for his anti-establishment stance. Even, ‘Imagine’ by John Lennon hit you with its free thinking. I don’t know what he was smoking when he wrote it, but it’s just such a brilliant canvas he paints for you.
But my all-time favourite was Fleetwood Mac’s ‘Landslide’, which is about coming to terms with the curveballs that life throws at you. Stevie Nicks and Lindsey Buckingham had broken up. The lyrics are about her dealing with it, with him strumming the guitar. It’s a crazy piece of real life drama playing musically in front of you.
I think art imitates life. So when you either watch a movie, listen to a song, it’s actually some part of life playing out in a sort of artistic form. Some lyrics have meanings, others inspire emotions. Some spark an idea and others just give you shelter.
My college days were also the time when I made my first bit of money by selling space, to retailers, in a magazine called Sidewalker. It ran for about a year before closing down. That was the first time I learnt how to sell and, in a sense, my risk appetite took wing those days. It was also around that time that the stock market bug bit me hard, a little too hard I think, landing me in bit of a spot.
From class 12 onwards, I had started reading up on companies and even made my first investment in Kaveri Engineering. Later, I also bought Nagarjuna Fertilizers, MRPL and LMW. But then, no newbie in the market wants to get rich slowly. In 1988, the era of physical shares, you could actually go long or short without much money upfront as delivery and payment cycles were days apart. Emboldened, I had short-sold through my broker, who also was my dad’s friend’s son. I thought the short trade would make money but it went the other way and I had no shares to deliver. So my broker turns up at eight o’clock in the night and says, by tomorrow morning, 9.30, I have a pay-in due and there’s no way that I can default. Seeing no way out, I told my mother about the situation and she said, “Tomorrow morning I will give you the money but never do it again.” In those days, Rs 10,000 was a big sum, but she bailed me out. There was good reason not to approach my dad. With his frugality and ethical standards, he would not have been thrilled by the financial stunts his only son was pulling on the side.
***
I inherited different things from amma and my dad. Amma gifted me the virtue of discipline. She was very measured about how she went about her life, and had a method to everything she did. I also like a well-defined structure to everything. I like a clean office, everything has to be in its place, even in terms of the organisational structure.
At times, the contrast between amma and dad was stark. Nothing excited dad much but he never cribbed about anything either. Amma was gregarious. She took to people naturally, made a lot of friends. She liked to eat out; my dad never did. She liked music, my dad never did. She liked to call people over for dinner; dad liked it, but not too often.
Also for dad, despite his apparent disinterest in business, he always had good judgement about things that mattered. Even today, if I am in a quandary about which direction to take, it’s very easy for me to decide, because I need to only think back and ask what my dad would do. The other thing that I admired was his value system. His salary was not much but I remember he got about Rs 1,500 every year in medical reimbursement. Many of his colleagues would claim it by submitting false receipts, but he would never. His example has always compelled me to take a straight line in life. I didn’t realize it then, but he was my first mentor and continues to be my guiding light.
***
After my masters, I briefly joined Tube Investments as a trainee before moving to Godrej and Boyce in 1990, my first job in Bombay. With one suitcase, Rs 1,500 and a haversack, I got off the train at Kalyan at 4 am. There was not much of a crowd but I had to figure out how to get to Vikhroli. But the first thing I was asked was whether I want to go east or west, I felt that was a rather odd question, since you are otherwise asked your destination. When I went native, I realised that had been in reference to the rail lines, the arteries that connect the north and south of the city.
By sheer luck, here I was managing one of the largest refrigerators plants in India. We had a great team that constantly looked for ways to increase productivity. But how do you convince the workers to build even more refrigerators?
I stumbled upon a fantastic, natural advantage. My knowledge of Hindi was poor and that of Marathi non-existent. So half the time, I really listened to the union guys without saying anything. Even when I had something to say, I just couldn’t translate fast enough. So the union leaders thought either he does not know anything or he knows everything and he’s playing the waiting game. But with some of them, I built a one-to-one rapport, and therefore during negotiations they began to trust what I said.
This bonding paid off when one morning the shop floor went all misty. Everyone’s eyes were itching and tearing up. We could not figure out what it was, so the plant was shut down. But we had to quickly figure out where the problem was and get the plant up and running. That is when the relationship helped. I called up these union leaders and said, “I want you on the shop floor now. Let’s together identify the cause”. The usual labour stance would be to take time off, not work for a couple of days and demand an inquiry. But, this time, everyone stepped up. We later figured the R&D lab was experimenting using a different set of specialised gases for refrigeration and some of the gas had leaked into a part of the plant. Tremendous quick thinking and a motivated workforce saved the day.
Another situation was when we found that two out of every 200 gas sealed compressors that we made developed leaks as they were not sealed properly. So it had to be gas cut, opened and then resealed. One day, the plant manager told me that the guys are just not doing enough of gas cutting and compressors are piling up. I went to the shop floor to talk to Tambe, one of the guys assigned the task. I asked, “aaj kya ho raha hai”, and he replied “mera haath dukhta hai, nahi kar sakta hai, bahut mushkil hai”. He said he could do maximum one a day when the target was seven to eight. So I asked, “kaise karte hai dikhao,” gave it a try and managed to do it in 10% lesser time than the average. Word spread in the factory.
Tambe was now in a difficult situation as some kid came and did in minutes what he was unable to do. Next day on, he started hitting his numbers and the situation sorted itself out. But if I had screwed up doing that, I would have looked like an idiot. When I moved on from Godrej, the union guys came and gave me a farewell. They took me out for dinner and I was scared to be in the restaurant that day with them because they were getting sloshed. If Facebook existed then, those pictures would have been posted there for posterity.
***
I left Godrej in 1991 to work with the Essar Group. When I discussed this with my dad, he said, “Nobody leaves Godrej or Tatas, you live there for a lifetime. You have a colony, a house, a brand that is hundred-years old, products that are well-known. Why would you leave this and join somebody who I don’t even know is a sole proprietorship, partnership or even what they do?”
When I joined Essar, I took a huge chance since oil and gas business was absolutely new to me. I had to drill from scratch. Terms such as derrickman, roughnecks, drillers, tool pushers and mud pumps entered my vocabulary. Soon after would come my first high-seas adventure. While not exactly a mutiny at sea, the standoff was no less intimidating to a shipping novice like me.
Until I entered the industry, I could not differentiate a lifeboat from a ship, I only knew that they both sail. And now, I had to negotiate with seamen who were refusing to sail because they wanted a higher dry dock allowance. The Italian built MT Nand Shivchand was moored at Madras outer anchorage. It was a 65,000 DWT bulk/oil carrier. As our trawler lined up next to it, I realised the five-storey rope-ladder climb that I would have to make to get on board. Thoughts of misstepping and plunging into the Indian Ocean crossed my mind, but there was an even more important matter at hand that needed to be dealt with. The vessel had cargo to deliver and then continue on its voyage because it was on a committed charter. The standoff was resolved through a deferred payment programme.
Then, Essar had bagged a directional drilling project in Oman from PDO. That was my first exposure to international staffing. At the time, with Omanisation, 45% of the total workforce had to be Omani. To begin with, it was a very complicated rig. Second, because it was deep desert, we could get only locals, who were camel shepherds. So, in order to show headcount, through a local procurer, we got 20 Omanis. But there was one thing that we didn’t bargain for – they came to work on their camels. These ‘ship of the desert’ would float all over the drilling site, and it was near impossible to keep them off the wellhead. We then decided to get the Omanis to clock attendance and sent them back home to shepherd their camels. If we had kept them at the site, we would have had LTA - lost time accidents. That one site later on grew to seven and became a very successful operation for Essar.
Similarly in Medan in Indonesia, there was geothermal drilling to be done and we had a liquidated damages (LD) date, the deadline by which the wellhead had to be active, to avoid paying compensation. Two weeks before the LD date, we had equipment that had to be transported to the site from Philippines. So part of it had to go by boat, because it was an island and part by helicopter. And we didn’t know vendors who would transport all this. The only guy I could get to help at that point was the president of Petroleum Suppliers Society of Manila. He said, “Let’s meet for breakfast”. At the table, he asked me, “Do you golf?” I said, “No”. He was also the president of Golfing Club of Manila. Out of interest, I asked him, “What’s your handicap?” Straight-faced, he replied, “My wife”. Needless to say, we spurted the well in time.
Something was always happening in the oil drilling industry. It was episodic, life was never done. What it taught me was to think on my feet. My stint in the shipping business moved my meticulousness up a notch. In shipping, you always need to have a plan. You had to be on top of everything – with respect to crew, certification, cargo and compliance with IMO regulation.
But after five years of operations, I decided that I want to work in the corporate office, and learn business at a governance level. That’s when I came back to the corporate office in Bombay from Madras, where I had been deputed to oversee the integration of South India Shipping with Essar Shipping.
***
At the corporate office, for the first time in my life I got to see entrepreneurial ability up close. The Essar brothers – Shashi and Ravi – seemed in a different league, inveterate risk takers with the ability to combine vision, projects and execution. It was remarkable how two outsiders from Madras came and built such scale, whether it’s with balance sheet, production capacity or technology. I was at the steel plant when a visiting European remarked, “This plant is a Rolls Royce”.
Every discussion internally was scale driven. Shashi Ruia would never get caught up with the small things in life. If there were 10 things on the agenda, he would tackle the three big issues and leave the rest to lesser mortals. There was an incident when molten liquid iron from the furnace overflowed onto the shop floor. In liquid form, it is very high temperature but once it cools down, it solidifies and is difficult to move. We were all thinking that this is going to shut the plant down for six months. At the meeting, he said there was no point discussing it here, that we have to go there.
He immediately hopped on a train. Once there, Shashi gathered key maintenance personnel to figure out which parts of the plant were unaffected. Then, he found service providers to fix the rest and incentivised the clearing process. It was a rare situation, there was no case study of how to deal with such an incident, but he had it done and dusted in three weeks.
Eighty per cent of my interaction was with Shashi’s son Prashant. We were of similar age and shared views on different aspects of life. He was very hard working, trusted my judgment in many matters and delegated a lot of work to me. It was enough to make any youngster feel important and good.
When I left the Essar Group in 1996, they were only in shipping and oil. In about six years, they would have shipping, oil, steel, refinery and telecom projects. To grow five core sectors in six years was incredible. They set up a 2-mtpa electric arc furnace to make hot-rolled coil which was almost the size of Tata Steel, which was 90 years old. They built it in just five years. And then they created a telecom network, got into a JV in Delhi and competed with Bharti and sold it to Vodafone. Then their refinery plan was ambitious, but it got delayed due to many reasons.
In retrospect, it may seem that they bit more than they could chew, but their entrepreneurial ability was incredible. The success or failure of their business is a separate issue but I consider them good people to associate with.
***
Around 1996, I got chosen as a Chevening Scholar to go and study at Leeds University. I returned a year later to join IDFC, when it was just starting up and I was among the first three employees. This is where I would meet Deepak Parekh, who was closely involved with nurturing IDFC, and it was my first brush working with a professional manager of his stature. If the Ruias showed me what entrepreneurial gumption is about, Parekh taught me to nurture relationships and build for the long-term. He was terrific to work with and our paths would cross again. After being with IDFC till 2000, I decided to strike out on my own.
The dotcom boom had seen private equity taking shape in India. The first few funds were ChrysCapital, JP Morgan and a couple of others. I was thinking about, doing something in the online space as WWW 1.0 had caught the fancy of almost everyone my age. I had a human resources background and knew that finding jobs was a matter of combining supply and demand, aggregating availability of jobs with supply of skills. There was reason enough to look at the internet as a medium to do that and I set out to create my first business, an online job portal. I met three investors to raise cash and all three agreed to invest between $2 million-$5 million into the business that I wanted to build.
This happened in the space of two weeks and as all three agreed to invest, that worried me. I wondered – if it’s so easy to raise cash to build a business it may also be easy for investors to pull the plug if one doesn’t deliver. It put me in a quandary – I had my wife and a two-year old daughter to support, not to mention my parents back home in Madras (by then Chennai). I could not afford to be rash.
At my last job, I was very well paid. I had my own house, a car. Those days, as a 33-year professional, I was very comfortable. I thought about it for a good two weeks and went back to the biggest among the three – JP Morgan. I thought they would perhaps give me a longer rope and would be the last to pull the plug if things did not go as per plan.
I met the India partners and, in an hour, we signed a business understanding note, two white sheets of paper which would later transform into a share purchase agreement. Unknown to me, I had inadvertently taken a life-altering step. I would very soon end up in a new city, with fortuitous timing.
JP Morgan was then seeding a portal called go4i on the lines of Yahoo, Rediff and Indiatimes. They wanted it to be multi-vertical with ticketing, sports, jobs etc. For ticketing, they tied up with Ashish Hemrajani who now runs BookMyShow. For careers, I was the spearhead; hence my company was called Go4careers. JP Morgan had tasked a leading IT services company in Bangalore with developing the portal and they suggested that I also use the same firm to build Go4careers. That’s how I landed up in Bangalore.
I hardly knew the city but quickly figured that software was a growing industry here, having just cashed on the Y2K opportunity, and it seemed set to become a much bigger technological ecosystem. This, I thought, was an emerging city to watch out for. That punt has paid off in spades.
When I moved to Bangalore in 2000, its population was 4 million, today it is 10 million. It has been the fastest-growing city in India for a long time, highest by office space absorption and highest by career creation – number of jobs. If you are in the careers space and if you are in the city that’s creating the most number of jobs, obviously you are there at the right time. Over the years, the city has not let me down though its municipal council might just have.
Sometimes, luck plays a big role. I only moved to Bangalore because my investor asked me to, so that I could be close to my site developer. But as luck would also have it, the careers site that they developed for us did not work out. If you searched for a doctor in Ahmedabad you would end up getting an engineer in Madras, the algorithm was just not functioning well enough. In June 2000, we inaugurated the site and by August we shut it down and took the placement company offline.
We had drawn down $500,000 from the agreed amount and capped it at that as we did not need any more money, now that we had gone offline. I decided we were not getting into the valuation game and would generate our own cash to fund ourselves. From very early on, I was tuned to generating cash.
Go4careers transformed into PeopleOne Consulting and grew to become a reasonably healthy recruiting company. Then something fortuitous happened. One of our clients those days was the Sterlite Group which in 2001 was looking to go international. They had just bought a mine in Australia and were setting up an optic fiber cable factory at Atlanta, Georgia. Optic fiber cable was at that time very big because the internet was going all over the world. They wanted help in hiring.
So when I landed in Atlanta in January 2001, I realised there is a concept called flexible staffing where you hire non-core employees from a third-party supplier. The Sterlite promoters decided to adopt it as it would provide enormous leeway with respect to costs. I shortlisted Adecco, Randstad, Volt, Manpower and so on, and met the representatives. We hired staff on contract basis and that was a blessing in disguise since 9/11 happened soon after and the plant had to be scaled down.
By now, I had figured out how flexible staffing worked and PeopleOne entered that space. We bagged Airtel as a client and I realised that post liberalisation; telecom, banking, insurance, retail and IT were the ones adding jobs rapidly. They would embrace this concept because they were growing gangbusters. We grew too, fairly quickly from 2001 to 2004, and became almost 40,000 people in size.
***
In 2004, JP Morgan had moved its fund offshore and wanted to monetise some of its India investments. We hired Rothschild as an investment banker to sell the company. At the same time Adecco, the world’s largest HR solutions company came calling, so we did the transaction. It was a terrific summit to reach, like if you had built an IT services company and IBM came to buy it. There’s a certain pride in selling to the leading player in that space.
As per the deal, I would have to stay on for three more years and join their executive committee in Zurich. During that time, I realised that if one had to grow in the competitive 1% net margin Indian market, one had to move beyond supplying people and manage processes.
I sold and moved on from Adecco in 2007. I was 40 and decided to take some time off. Like gentlemen of leisure, I tried to golf but didn’t quite take to it, or to sitting at home. I also realized that the house has place either for you or your wife, and only one of you can occupy it full time.
***
My new found prosperity had led me to buy a BMW but I could not tell my father for six months about it. I knew he would reprimand me. When I did tell him, he asked, “What is the need for this? Isn’t a smaller car good enough? Or the house that you bought, why do you need so many rooms, three rooms would have been fine!” His frugality, though, in no way interfered with him being large hearted. He always used to remind me, “Let nobody go away empty handed. If somebody comes and tells you my son is studying engineering and needs Rs 70,000 for fees, if you can’t give him Rs 70,000, give him Rs 7,000. If you can’t yourself, connect him with somebody who can.” His counsel still fuels our initiatives at Careworks. To him integrity, frugality and generosity were intertwined. He always used to tell me ‘areyum chadikyam padilla’, meaning ‘don’t cheat or don’t let anybody down. Keep your word, always’.
That’s been important for me in terms of how we have built our relationship with investors. The JP Morgan connection has been a constant throughout my entrepreneurial journey. In the beginning, it was Bharat Kewalramani and Anil Ahuja. They had four investments in Bangalore — Planet Asia, Microland, MTR and us. We were the smallest, so Gaurav Mathur from JPM joined us and helped us with board issues. I got to know him fairly well in the process.
***
By 2009, I was looking forward to develop a business services platform for human resources. Gaurav, too, had quit JP Morgan to start India Equity Partners and had invested in Ikya Human Capital Resources. So when I had the opportunity to work again with Gaurav, I was most happy to do it. Another JPM connection would soon come into play when India Equity Partners would seek to exit Ikya. Gaurav had committed $8 million in Ikya and then I bought about half the company and became the CEO. The market was coming out of the global financial crisis, so it was not easy but we grew the HR business and quickly added facilities management. With facilities management, we got the first bit of a business services company and then added professional staffing company Magna.
Earlier, we had added another HR service company called CoAchieve. So we did three, four acquisitions over the span of say two to three years. And suddenly the platform was beginning to take shape and by 2012, we were heading to becoming a business-services platform, which meant that we would do non-core activities of organisations. We got Fairfax to buy out India Equity Partners, and they put in fresh capital and became the largest shareholder. Gaurav knew the then-MD of Fairbridge Capital, Harsha Raghavan, due to their stint at Indocean.
In 2012, I had decided we should go public in about three to four years. The preparatory work in run up to listing is daunting and that lead time I thought would be good enough. I was yet to hear Woody Allen’s quip, “If you want to make God laugh, tell him about your plans.” Ikya’s origin was in the Sanskrit word aikyam, meaning oneness. It got much identified with the human resource business and there was also a running trademark dispute with a marquee furniture retailer. We did not want to IPO with a name that was under dispute and also wanted our brand to encompass more than just the HR business. Quess Corp came up as an option as it seemed to suggest solidity and strength. Trivial as it may sound, what also went in its favour was the availability of the domain name.
We seemed on course and, in the third week of June, 2016, RBI Governor Raghuram Rajan resigned. The market took a knock and then some as Brexit followed soon after. Of our three investment bankers, one was sure that we should not go ahead, one sat on the fence and the third left the decision to us. But we decided to go ahead.
One of the best decisions that we have taken is to become a public listed company. We raised Rs 4 billion, at Rs 317/share. And the issue was oversubscribed 145x. I still remember watching the screen in my office on the last day wondering if it is for real. We listed at about Rs 500, and went on to hit a market cap of almost $2 billion.
Amma passed away due to cancer in April 2016, three months before the IPO. But when we decided on the IPO, I told her about it and she was happy. That was one of the last serious conversations I had with her before she went away. Her presence lingers in the lamp that rests just outside my office. When we inaugurated the Quess HQ in 2014, she had brought it from Madras to bless the office. She had something about lamps and lighting. For every important event, she would call in the morning, wish me and say a prayer. And then she would always call back to check what transpired.
When she was around, she would pamper me silly. I like non-veg as well as thoran (vegetables cooked with coconut). Every time I went to Madras, regardless of what time of the day it was, she would make seer fish.
One of the things in life is to be wanted, whether it is in a company, family or among friends. The biggest joy of life is to belong to something, and mothers and parents do that very well. My most memorable moments with my father were of visiting him in the last five years, when he still had a good memory. We would sit and talk, and that one hour of conversation cheered him up. He would always sit up, ready for longer chats.
During his final years, he never asked how well the company was doing, instead he would ask, “kadam indo?” (Do you have debt?). I had to be truthful every time we met. So at our company, debt became a four-letter word. Even now, we are fairly hesitant and gearing is 0.2x. If my father knew that we now employ 350,000 people, he might have simply frowned, “Oh, you have that much responsibility now? Then you can’t take any decisions foolishly, because it impacts so many people.”
Looking back over the years, our acquisition spree is a clear standout. I feel it evokes skepticism, curiosity and admiration in equal measure. Financial and commercial due diligence was initially a bit of a challenge but over time it became natural for us to assemble, either externally or internally, the type of skills that we needed to comb through anything.
Coming from an HR background, I realised that to be an operating manager, you need a good hold on finance. And that rigour has contributed a lot towards building Quess. Acquisitions are a tough business, they first happen at the people level and it’s not something you can train for. I run a couple of tests when I am evaluating an opportunity. One, is this somebody whom I would like to take home for dinner? And if I can’t, it’s fairly clear that this is not somebody I like to associate with. Your house is your private space. You don’t want that to be polluted in any way by people that you don’t relate to. Second: If you go to sleep, for say five years, will this business still be around? If it won’t be, then you should not be in that business.
I think there were one or two situations where we could have done better. In those situations we did spot personality conflicts, but were driven by deal dynamics. That’s one thing that I have now hardcoded in my head. If the deal is looking a lot better but if the person is not someone that fits the bill, I give it a pass.
In fact, we have copied a page or two from the Fairfax playbook. I don’t know if many are aware that Fairfax expands to fair friendly acquisitions. That’s something even we have imbibed. We also do friendly deals, have never used investment bankers, build for the long term, are cash-flow focused and like to do deals with people whom we have a certain comfort with.
***
Now that I have mentioned Fairfax, Prem Watsa can’t be far behind. Over the past five to six years, Prem has been an outstanding influence. In a manner of speaking, he has become a father figure in my life.
I met Prem for the first time with my CEO Subrata and Chandran Ratnaswami, who looks after his India business. Given that we were pitching for capital, he asked me, “What is it that you want to do?” I replied, “I want to create an institution that has deep impact socially, is run with the highest ethical standards and creates a lot of value for shareholders, and I want to do this in my lifetime. I want to do it with people that I am comfortable with, and with a speed and pace that all of us agree with.”
Besides my idealism, I was looking for long-term proprietary capital rather than a fund which would seek an exit in five years, I had a successful exit for JP Morgan during PeopleOne and now I was about to ensure one for India Equity Partners. Even though the valuation that Fairfax offered us was lower than other investors, I decided to go ahead because I liked Prem and, in retrospect, it is one of the best decisions I have taken. That day I knew I had not just a partner, but an inspirational partner. Somebody who — after you set the bar at five — without saying anything, but through his actions and behaviour, would inspire you to raise it to six. He effectively invested $45 million that is perhaps worth, today half a billion, at peak it was worth a billion or so.
I trust his judgment in many matters. On almost every acquisition, post Fairfax coming on board, I send him a note saying this is what we are working on, what do you think? Once we are in agreement, that is when I take it forward. “We just got started” is a favorite line of his. I remember telling him that we are now 300,000 people strong, and he just patted me on the back and said, “You just got started young man, you just got started”. He’s such a warm guy and he makes you feel wanted. At the cost of repetition — you always like to feel wanted.
I love the way he has decentralised operations and yet is available should the need arise. I remember the Fairfax AGM had just gotten over and there was one pending acquisition issue to be sorted out. He had been on the stage for three hours and had barely finished. Next thing, his secretary calls me asking if I want to come and talk to Prem about the issue. It was sorted out immediately. All these guys Prem, Deepak are decisive, people-oriented and encouraging. They are not stoppers, they are pushers.
I am quite fortunate to be still in touch with Parekh as he is on the board of Fairfax India, our largest shareholder. At IDFC, Parekh was a tough taskmaster. He’s very demanding because he himself is sharp, all the time. I remember once he had to present a paper on power sector reforms and comparative reforms in India and South America. Strangely, he called me to help him put some notes together. I realised that was his way of training people to work on something more. Also, to communicate that you are in his scheme of things, that he has an eye on you.
He trusts people implicitly. He assigns you something and would not call you back until the date is due. This also taught me later in my life that you can pick ordinary people for extraordinary jobs. Lots of people have grown with me since my first entrepreneurial venture. Some who joined me as management trainee are now heading businesses and operations.
There is Chief Operations Officer for India Guruprasad who has been with me from PeopleOne till now. Then there is Vijay Sivaram who heads our South East Asia operations. He’s been with me since 2002. Amrita Nathani who handles Search joined us as management trainee in 2002. My secretary Pratibha has been with me since 2006. Subrata, our CEO has been with us since 2008. Lohit, who heads our staffing business, has been with us for the past 10 years. Anand, who heads our facilities business, was with me in PeopleOne and then he joined us three or four years later.
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When you recount life, I think a good life has a lot of pleasant memories and I have been fortunate to have many. My time in Bombay turned out to be life changing for a couple of reasons. It built my career and, through mutual friends, I met my future wife Sarah. We got married in 1995. I can’t fathom life or any of my success without Sarah. When I turned entrepreneur, our income dropped to a fifth, just enough to run home. I essentially went out on a limb but she stood by me.
As a first-generation entrepreneur, when you set out to build a company, your life gets pretty one-dimensional. Everything revolves around getting the service, process and customer right. Focus on family takes a backseat and it needs to be compensated by a partner who takes charge. That’s what she did for me. Sarah was a certified cost accountant but gave up her career to ensure that our daughter’s upbringing and education did not fall short in any way. She stepped up to the task even when both, her and my parents needed medical attention. Her parents were cancer patients; my mom was a cancer patient and dad a heart patient. They all needed hospitalisation at various points of time, and she was with them through it all, attending to their needs. The most outstanding thing about Sarah — despite all that pressure — she never complained or made any exorbitant demand. She provided me with a centered and well-cared for family. If you have some debris at the family level, it is difficult for you to get completely organized at work. It is from your nest that you take flight.
My daughter Tanya’s life has been coincidental with many changes in my career. Two years after she was born, I turned an entrepreneur. Quess went public the year she went to college in the US and now as she will graduate, Quess is morphing into a global business services company. Her “Hello Papa” over the phone line, 9,300 miles away, is worth all the journeys that I have undertaken in my life.
Just one email a week