Successful Business Story: Inspiring birth story of India’s most celebrated software company – Mindtree With my experience of being into business, I can clearly tell you one thing – every aspiring entrepreneur needs to read atleast one inspirational successful business story before starting their own business. With that as the basis, in this blog, I would be talking about the making of one of the respected and celebrated IT services company of India – Mindtree Consulting.
Subroto
Bagchi
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Co-Founder
of
Mindtree The first time I heard about Mindtree’s co-founder – Subroto Bagchi was in the year 2007, when I accidentally found his book – The High Performance Entrepreneur on one of the shelves of Sapna Book House in Gandhinagar, Bangalore. Those were the days when entrepreneurship and business were my fascination and anything that spoke about the subject drew my attention. The same happened with the book and I became a big fan of Subroto Bagchi after reading this fantastic book. I would strongly recommend this book to anyone who is thinking of starting a company. This book is one of those books on business that inspired me to quit my high paying job at General Electric where I was working as a Senior Design Engineer, to start my own coaching academy Subhash Programming Classes. One fine day, while going through Subroto Bagchi’s blogs, I found a 26 pages pdf article, with the title “Making of Mindtree”. I quickly downloaded it and started to read. The article contained a beautiful narration of a successful business story . It was the journey about how 10 friends started today’s most respected IT services company Mindtree. I quickly
archived this into my gmail for further reading. This was in the year 2009. Since then, I have been reading this article several times just to keep myself inspired. It’s almost 10 years now. After a decade of teaching programming to students, I wanted to try something different in the online space. After so much of thinking, I decided to start my blog BusyMonk.com – to write about successful businessmen and their stories but not completely limited to that. As part of this blog, I wanted to write the making and success story of Mindtree and therefore I started to go through the article once again. Though the original article is 26 pages long, I have cut down some of the contents to keep it crisp, neat and clear. If you are looking for a full version of the story, a quick google search of “Making of Mindtree” will yield you a good number of search results with the pdf to download. Let us begin to read about the successful business story of one of the most respected IT companies in India.
Important Note: The “Making of the Mindtree” is told in the first person by Subroto Bagchi. In condensed form, it was published by BusinessWorld, filmed by InfiniTV, and aired on CNBC, IT Hour.
Mindtree – Old Logo
The Making Story: After working for Wipro for almost a decade, in April 1998, Subroto Bagchi moved to Lucent Technologies. Lucent wanted to set up their Bell Labs
Development Center at Bangalore. Subroto Bagchi recalls, how he had the opportunity to work on a strategic study of the future of the Indian software industry while at Lucent Technologies. Subroto Bagchi was clearly able to envision the future of businesses. He could visualize that, 21st century belongs to the those who can emerge as a leader in the services industry especially in the information technology sector. Given that, he felt there would be an insatiable demand for software services all over the world and those who can give early emphasis on it can reap the benefit of creating post-millennial software solutions company. An idea started lingering in Subroto Bagchi’s mind about starting a value driven software services company while in Lucent Technologies. With this conceived idea in Subroto Bagchi’s brain’s womb, he called up his excolleague N. Krishna Kumar to discuss this idea. Krishna Kumar was at that time the chief-executive of Wipro’s electronic commerce division and had 18 years of experience in Wipro. Krishna Kumar was one of Bagchi’s colleagues whom the latter will always look up to in terms of professionalism and work ethics. On 17th June, 1998, Subroto Bagchi invited Krishna Kumar for lunch, which Suborto Bagchi quotes as the life changing day for both and many others. Because that meeting was the starting point for creation of Mindtree – one of the successful business story of India.
N.Krishna Kumar This was an auspicious day, especially for Krishna Kumar, as it was his son’s birthday. By the end of the lunch, both had agreed to quit their respective jobs after few months to start their dream company. Until then, they decided to meet every weekend to sculpt the future of the next big thing – a respectable software services and solutions company, whose successful business story will inspire many more generations to come. All this being in their respective jobs until they finalise their plan. These weekend meetings went on for a while and during these discussions, they clearly understood that, they needed a professional guidance from someone who is really wiser and motivating. As Subroto Bagchi and Krishna Kumar spent most of their years in the corporate sectors, they knew almost everyone in the corporate world. But, they were looking for a wise and motivating guide who can maintain confidentiality too. Yes. They were
filtering out the candidates from the vast list of professionals who came to their mind with three parameters – wisdom, motivating and one who can maintain confidentiality about their baby idea until it is comes out to the world. After loads of thinking, Subroto Bagchi circled down to one person named N.Balasubramanian who took up teaching at the prestigious IIM after a premature retirement from Wipro. One fine day, both Subroto Bagchi and Krishna Kumar went to meet the professor at the IIM to discuss their ideas and take suggestions. They put out all their doubts to the professor like how to approach investors, how much funding to expect, which is better among renting a space or owning one etc. After listening to such series of doubts and questions from them, the professor suggested the duo to first write a compelling business plan as it would give them an idea on how much money needs to be pooled in from investors. This made sense to both Subroto Bagchi and Krishna Kumar. At the end of their discussion, while the duo was about to leave the office, the professor called them back and gave them a success mantra – “underestimate the income and overestimate the expenses” – Anyone with a little common sense would understand the power of this mantra and does not need any explanation. Subroto Bagchi during his interview says, “When you are about to set sail for a long and arduous journey, it is not the promise of the wealthy or, the push of the powerful that helps you to cast the boat. It is the first word of kindness, a simple message, an almost frail word of detached wisdom that signals you to lift the oar”. Because of the duo’s hectic work schedule and busy overseas assignments in their respective companies, they had no time to get their business plan structured. The duo were totally against using the company resources and timings to create their successful business story. They wanted to do justice to their employers. Meanwhile, time was just flying. They wanted the help of more friends who believed in their dream to sketch the business plan of their dream company. Around this time, Subroto Bagchi had to travel to US on company(Lucent Technologies) assignment. During this time, as fate had to do its bit, Subroto Bagchi had to stay with one of his relative who knew Anjan Lahiri – the man whom Subroto Bagchi knew as a smart salesman while he was in Wipro. He had quit Wipro long back in 1989 who travelled to US for an MBA and settled there with a successful job in Cambridge Technology Partners. During Subroto Bagchi’s visit, Anjan insisted Subroto Bagchi to spend a night with the family.
Anjan Lahiri During his stay, Bagchi discussed with Anjan about the latter’s work life with Cambridge Technology Partners. After listening to Anjan about his awesome work life, he questioned if Anjan would be interested to join Subroto Bagchi and Krishna Kumar to create a truly valuable and inspiring software services company. Anjan and his wife was very excited and gave a thumbs up even without a second thought. Immediately, Subroto Bagchi called up Krishna Kumar to inform him about the increased size of the team – 2 to 3. Krishna Kumar was very happy to hear that. But, one question that kept them in the dark was – From where do we get the money for our startup ? With no business plan ready yet, equipped with only their personal CVs, they approached three venture capitalists, one Indian based, another US based and the third was Europe based. Though their personal CVs were quite impressive for all the three VCs to encourage their ideas, the three partners knew very well that, they definitely needed a well-structured and well-documented business plan. Along with the business plan, the three partners were also feeling a sense of void in between them. They felt something or someone is missing in order to get their dream company happen. They realised to create a successful business story for future generations to read, it needed more strong characters. After a long thought, they understood, their dream team needed a strong technology leader. Both Subroto Bagchi and Krishna Kumar decides to talk to two technology veterans they both knew very well from Wipro again. One of them was an application expert and the other was a technology veteran. While, the application person readily accepted to join Subroto Bagchi, Krishna Kumar and Anjan to create a dream company, the technology expert was little skeptical about joining the trio and asked them more than 30 questions about the business and promised them to get back after talking to his wife. But, much for the trio’s surprise, the application expert who had initially agreed to join the trio, called up and conveyed his disinterest and decided to drop off from their idea. Where as the technology veteran who was initially skeptical about the business idea, came back to the trio with a decision to join them and be with them in their long journey of creating a successful
company. The technology veteran was none other than the General Manager of Wipro’s Technology Solutions – N.S.Parthasarathy – An alumni of BITS,Pilani and IIT, Kharagpur.
N S Parthasarathy With a strong four member team ready, they knew very well that, they were far behind their dream as the business plan documentation wasn’t even started. For writing the business plan, they realised, they had to take off from their regular work, get together in a common place, discuss the business story and write. Time was just flying. In the month of December, as it was a Christmas season with loads of holidays in their calendar they decided to get together in a hotel – The Park Hotel in Vizag for their business plan preparation. As most of the founders were very well known fraternity in the IT sector, especially in Bangalore and Mysore, they feared the exposure of their business venture if they holed up in any of hotels in Bangalore or Mysore or any other nearby places instead of Vizag. That is how they chose Vizag. Anjan, decided to fly from US to Vizag directly, where as the other three founders along with two other friends decided to travel to Vizag on road by car. They reached the “The Park Hotel” in Vizag in the mid night of 24th December. On 25th December, all six friends, out of which four were confirmed founders, one was a prospective co-founder (details revealed at the end of this story) and the other was a common friend, started arguments, discussion and debates passionately about creating their future company. After a week long discussion investing almost 12 hours a day, they came up with their first mission and vision statements. Mission statement read as “We will deliver business enabling softwaresolutions, by creating partnership with our customers, in a joyous environment forourpeople”. If the mission statement is carefully read, it incorporates
three segments – the business they do, the partnership they make, creating a friendly and joyous environment for their employees. They had created 4 vision statements which read as follows: Achieve $100 Million in revenues in 5 years. To make investors, customers and employees feel proud about associating with them.
Establish development centers in four international locations
To build a world-class organisation to span across the world not limiting to just one or two locations and serve customers across the globe by being closer to them.
Create ownership theorganisation
through
stock
options
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To create wealth for everyone associated with the organisation.
Commit a significant portion of our PAT to support enhancementof primary education in the societies we work in.
To support education especially in the rural areas where government schools are illmaintained.
They came up with six core values on which their dream company would be based: 1. 2. 3. 4. 5.
ReduceTotal Cost of Ownership for our customers Partnership is the cornerstone of our existence Respect individual contribution but, valueTeamwork higher Create an Organization based on learning, innovation andquality Enable employees to rise to full potential and reward withwealth creation 6. Conduct ourselves with the highest sense of integrity They also decided to focus on two kinds of businesses: 1. Net Enabled Business 2. Application Maintenance Services Now, after much of the discussions, they had to figure out how their future company would stand out of the crowd among all the other big competitors. After a final discussion, they came up with 4 differentiating factors: 1. 2. 3. 4. 5. 6.
Be known to customers as a specific domain expert Be equipped with latest software tools to solve customer problems Develop their own methodology to solve customer problems Provide utmost quality in terms of service, Continuous Innovation Building a reputed and a strong brand in the IT services space
No wonder, with such a passion and dedication to achieve their dream, their story became the widely read successful business story in India. With four founders, a structured business plan, vision and mission statements, they ended their initial discussion, packed up things and pulled out the cars to come back to Bangalore with an idea of meeting venture capitalists as their next action plan. Though they advanced their discussion of funding with three major venture capitalists, nothing worked on their side, but they kept their dream alive.
Kamran Ozair and Scott Staples Meanwhile, one of the founders, Anjan insisted Subroto Bagchi to have a word with Anjan’s colleagues Kamran Ozair and Scott Staples about their new business plan. Kamran has a vast technology experience with several successful projects handled at Cambridge Technology Partners. After Bagchi’s presentation, both Kamran and Scott agreed to join in along with others as co-founders to build a reputed company. I wonder, what could be the power of Subroto Bagchi’s presentation ? I feel I should sit in one of his presentations to learn how to convince people. A true businessman was in the making.
Kalyan Banerjee and Rostow Ravanan Subroto Bagchi also found potential in two more people who can add value to their dream company. One was, Kalyan Bannerjee who was heading the
Human Resources Management at Wipro’s Technology Solutions. Second was Rostow Ravanan, who had moved to Lucent Technologies to help set up the Bell Lab Centre in Bangalore. After discussing the vision, mission statement with the two, Subroto Bagchi could convince both Kalayan and Rostow too to join their team as co-founders. By now, you should understand that, a successful entrepreneur is not just the one who comes out with an idea, but the one who also brings in people together to get the idea executed After a rough ride with the earlier venture capitalists, Subroto Bagchi and Krishna Kumar decided to pitch in their idea to another venture capital firm – Walden International, where their common friends Sudhir Sethi and Som Das were working. They knew each other during their earlier days of working with Wipro. They made their presentation to Som, and at the end of the pitch, Som and Sudhiragreed that it made sense to carry the discussion forward with another meeting with business plan emphasis only on the financials.
Ashok Soota When these things were unfolding here, there was one more start-up story on its way from the board room of Wipro. Yes, one of the very close associates of Azim Premji, the Chaiman of Wipro, Ashok Soota – the big man of Wipro, communicated his intentions of starting something on his own to the Chairman. Ashok Soota too had called up Som Das of Walden International to check for funding possibilities. Ashok Soota was also the boss of Subroto Bagchi while he was in Wipro. Som Das, after discussing with Ashok Soota about his business plans, found there is a similarity between Ashok’s idea and the idea of these folks led by Subroto Bagchi. Som asked if Ashok would be open to merge the dreams.Ashok Soota did not hesitate to say “yes”. He said, “go ahead and speak to Subroto, and ask him to call me after he comes to India”. Som also spoke to Subroto Bagchi about Ashok’s intention to join their dream team for which Subroto was very happy and excited. Within minutes after this call, Som conferred
withWalden’s Chairman and got the go ahead from him. This was not a deal to miss, they all felt. Ashok Soota is a very well known face in the IT industry not just restricted to Wipro, but outside too with almost two decades of vast experience. When such a big man joins a dream team, creating a successful business story is inevitable. Subroto Bagchi called up Krishna Kumar to convey this information. Even Krishna Kumar was very excited to have Ashok Soota on their dream team and felt that would create history in the IT industry. Both Subroto Bagchi and Krishna Kumar met Subroto Bagchi at Ashok Soota’s Bangalore residence to pitch in the idea of an unnamed, unfunded company to make Ashok Soota, as their Chairman. After the presentation, Ashok Soota took few days of time to think on this. After evaluating his life script carefully, Ashok Soota called in the duo toconvey that he would like to merge his dream with that of the other folks led by Subroto Bagchi and agreed to acceptChairmanship of an unnamed, unfunded start up. Subroto Bagchi recalls, how even before they could start a business, they did a merger – the merger of two similar thinking minds. However, Ashok’s news had to be handled with extreme confidentiality. As Ashok Soota is a big name in the business sector, the news of him leaving Wipro, if handled poorly, would adversely affect Wipro’s brand image and stock market performance. Everyone in the team agreed that the news must be protected till Wipro identified a replacement and they also thought that ethically, they should let Wipro make the first announcement. Based on Ashok Soota’s suggestions, they needed tocompletely revisit the size of their dream, redo the business plan, rethink the requisite investment strategy and not the least, get themselves a name. The team started getting into the execution mode slowly. They all could smell a business success story in the making. From the the subsequent days each of the founders were working from 7 PM every evening to pastmidnight revising their first Vision. As sketched in the business plan, they all aimed for a revenue target of $123 million by 2005. Ashok also suggested to bring forward the commencement date of their European operation. On Ashok Soota’s advice, their initial idea to build their own building was dropped as they felt it was unnecessary. By now, the team also started hunting for a nice name for their dream company. While all this was happening silently, Economic Times reportedly leaked Krishna Kumar’s news of leaving Wipro. A few journalists had understood about Subroto’s departure from Lucent but in keeping with Lucent’s wish – he had to stay away from them completely. However, no one could guess
that Ashok Soota was also in the picture. Even after repeated questions and enquiries from various media channels, Ashok had to make a straight-faced denial, even though he was very uncomfortable about it as the press had to be handled with transparency. “But then, there are times when you do not own the truth”, says Subroto Bagchi during an interview later. It was tough time for the entire dream team to protect the truth from the press, but still they kept quiet. All tough times are worth going through, as those moments are worth sharing to people during the narration of their successful business story which would set as an example for many younger generations to come. The team finally zeroed in on two investors as their venture capitalists – one an US based Walden International and one Indian based Sivan Securities that was started by Cafe Coffee day’s founder V.G.Siddhartha. On 15 July 1999, away from media, in a non-descriptive conference room in the basement of Gateway Hotel in Bangalore, at 9.30 pm, founders of the unnamed company,Walden and Sivan Securities signed the agreement. It was a fantastic occasion that underscored the power of friends coming together. Business success, money, and attendant trappings were less important. The entire team was happy that they had done a deal with friends, with people who shared the same value system. There were two things pending for the company to happen. One is the name and the other is the logo. The team approached a California based company that was specialised in suggesting names for companies if the intended nature of business is given to them for a fee. The company came up with 729 names, out of which the team finalised “MindTree” as its name. The decided to name the company “MindTree Consulting”. Now they had a dream, they had ateam, they had a business plan and they had a Chairman who was an icon in the industrybut no visual identity for themselves and their company.The logo for the company was missing. The team approached Karnataka Spastic Society, which takes care of children with cerebral palsy. Children with cerebral palsy are often blessed with fine minds that are trapped in a disobedient body. Some of them have limb coordination problems, speech and hearing impairment. There is no cure for cerebral palsy. The team let the children do the logo design for Mindtree. The one that clearly stood out was the work of 17-year-old K. S.Chetan. Chetan has a form of cerebral palsy that denies him coordinated limb movement and affects his speech. But his brilliant mind overcame all odds. In one skyward blue brush stroke, Chetan depicted boundless imagination. He surrounded the skyward blue brush stroke with yellow dots, pretty much like a tree in bloom. To him, the yellow dots symbolised “bubbles of joy”. On August 18, 1999, the team presented their visual
identity to the world and a successful business story – MindTree was born with 10 successful entrepreneurs as the co-founders.
Mindtree Founders The 10th person whom MindTree did not mention during its press release was S.Janakiraman(do you remember the one whom I had mentioned earlier as the prospective co-founder ?) who was then the president of Wipro’s global R & D. Sometime in July, as the news of Ashok’s leaving Wipro got to the world, Jani was devastated. Janakiraman thought the world without all the founders of MindTree in Wipro is not going to work for him and there was no way he would stay on at Wipro. After a few rounds of discussions, it was settled that he would be Mindtree’s tenth co-founder, a fact that could not be made public on August 18, 1999.
Source: From Subroto website www.mindtree.com
Janakiraman Bagchi’s blogs
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Mindtree’s IPO : MindTree became a public company on 12 December 2006. It was listed on the Bombay Stock Exchange and National Stock Exchange. MindTree’s Initial Public Offering (IPO) opened on 9 February 2007 and closed on 14 February 2007.The IPO was oversubscribed more than 100 times. MindTree announced a new brand identity and logo, with the slogan “Welcome to possible” on September 28, 2012.
Mindtree New Logo
MindTree Today: The company boasts of its employee strength as approximately 17,000+ with annual revenue of $780+ million. The company deals in e-commerce, mobile applications, cloud computing, digital transformation, data analytics, EAI and ERP. Minster deals with more than 344 active clients with 43 offices in over 17 countries, as of 31 December 2017. Its largest operations are in India and major markets are United States and Europe.
The Conclusion : Mindtree’s story is still one among the most widely read inspirational business success story in India. The story of Mindtree shows how intelligent people can come together to create something of value that can be left behind for generations to come. It is also the story of 10 successful entrepreneurs who with a common desire worked together to achieve the extraordinary. This successful business story is also an example for many who wrongly think, entrepreneurship should be necessarily started at an early age. All the co-founders of Mindtree were in their mid-40’s when they decided to come out of their comfort zone. As far as I have analysed, one of the primary factor that shaped their successful business story was their vast industry experience. One more important learning from this successful business story is the patience that the entire team had to make this success happen. Special mention should be given to Subroto Bagchi for his unmatchable convincing skills that helped all 10 co-founders come together to achieve the extraordinary. I would strongly recommend all wannabe entrepreneurs to follow Subroto Bagchi’s blogs and read all his books, as I did, because, that has contributed a lot to my work in a positive way. I wish you all the best and give me an opportunity to write your business success story.
Please comment below about your future business plans if any, or on how this successful business story helped you towards reaching your business goals. Further Reading: [ Business Success Story Of Infosys ]