Raju Venkatraman’s experience as a serial entrepreneur has broadened his personal and professional horizon while positively impacting society
“I believe a venture must have a purpose besides making money. Money is a significant by-product, but what drives me is the larger purpose,” says Raju Venkatraman, founder and director, Medall Healthcare (Medall), a Chennai-based healthcare company. This is his third venture, after Vetri Systems in 1991 and RevIT in 2002.
Medall, which acquired Precision Diagnostic in 2009 with a focus on diagnostics mainly for the Tier II and Tier III regions in southern India, has expanded its vision to provide healthcare and cure by enabling prevention at affordable costs. Competitively priced, the diagnostic centres thrive on volumes. Sharing his vision, Venkatraman says, “Through partnerships with the government and private hospitals, we are taking high quality healthcare services to the underserved areas of the country.” At present, the company is fairly large in radiology services and provides focused solutions for the poor and women.
Venkatraman views this as just the beginning. He estimates the overall healthcare market in India to be US $3 billion to US $4 billion, but believes that the industry is segmented with most players operating in the sub US $100 million range. And this gives everybody a chance to expand while impacting society in a positive way.
In 2010, the company started with eight centres and its tally reached 35 by 2011. Its target for the current year is to hit the 100 mark thereby employing 1,700 people – both medical and non-medical staff. In addition to expanding in the four states it currently operates in, the company is looking to foray into other regions to create a pan India presence. It is also in the process of expanding its areas of services – from diet consultations to mental health to providing non-intrusive surgical solutions in government hospitals. As part of its growth strategy, Medall is encouraging hospitals such as Sundaram Medical Foundation in Chennai to outsource diagnostic services to it. This is a win-win for both organisations as Medall can grow by means of volume while the other hospital can focus on its core functions.
Raju Venkatraman believes in mixing micro and macro management, as he believes that an entrepreneur should create ventures that can run with or without the founder’s presence.
As for how the diagnostic centres are run, Venkatraman believes in mixing micro and macro management, as he believes that an entrepreneur should create ventures that can run with or without the founder’s presence. “Our centres are managed by people with a background in management, while medical and paramedical staffs manage the diagnostic side,” he explains. Medall’s aim is to go beyond making each centre profitable and recognise those from the organisation who have the potential to become entrepreneurs.
Where it started
Throughout his career as a serial entrepreneur, Venkatraman has practised a mix of micro and macro management. This has also been one of the reasons he has successfully exited his previous ventures, at the right time.
An alumnus of IIT-Madras 1981 batch, Venkatraman worked abroad in companies such as Cadbury’s and Electronic Data Systems (EDS), while being responsible for the divisions he worked in. At EDS, Venkatraman realised the potential to use India as a hub for outsourcing work. He even wrote about this to Ross Perot, the founder, in 1987 and was promised something would happen soon. Meanwhile, Venkatraman continued to work on cutting edge technology of that time – scanners, compressing data, digital imaging and the likes.
When by 1991 the promise had not come through, he decided to venture out on his own and founded Vetri Inc. in the U.S. He initially started with product development, but when he realised the magnitude of funds required to distribute products, he turned the company into a BPO. Since satellite technology was becoming feasible at that time, he moved jobs to India, thus fulfilling his dream to create jobs here. The company was into digitising case laws and also into health insurance claims processing, and started Vetri Software in 1993 for developing solutions for publishing databases, workflow management, archiving and retrieving data. With an aim to create a global footprint, it acquired companies in countries such as Granada, Barbados, China and Philippines.
In 1999, US-based Lason acquired Vetri and Venkatraman continued to execute the strategies he had worked on. Though his unit continued to be profitable, other issues forced Lason to declare bankruptcy and Venkatraman resigned in 2002.
Retirement was out of the question for Venkatraman. “I had developed no hobbies and was like a fish out of water,” Venkatraman confesses. He had returned to India with the idea of either doing social service or starting another venture. The lack of good service providers in the healthcare processing space tipped the scales in favour of starting his second venture – RevIT. Here, not only did the companies process claims but also made the payments. This meant that the training of the employees was that much more rigorous.
In 2005, when he was ready to scale up, he found good synergy with ICICI Bank’s BPO subsidiary – ICICI Firstsource. “The company was good at raising money and I had a strong business to run,” he points out. The two companies merged and Venkatraman became the joint MD. In the three years that followed, he grew the company to 23,000 people and expanded to other countries, all while establishing centres in the smaller towns in India including Siliguri, Indore and Trichy.
In 2009, though offered the post of MD, he opted out. This time, he wanted to do something India centric in the healthcare space. After much research, he decided to focus on diagnostics as he found this to be highly unorganised and fragmented. He acquired Precision Diagnostics and rechristened it as Medall.
Passion for progress
Medall has been rated as the number one emerging diagnostics services provider in 2011 by Frost and Sullivan – a recognition that Venkatraman is proud about. As is often the case, one of the primary reasons for the company’s success has been its people. The team is selected carefully with attributes such as passion, competence and commitment being as important as the necessary qualifications. The dearth of skilled and committed talent in the market has also compelled the company to start its own training academy.
Even as the company courts growth aggressively, it has to work past the existing challenges. Consumer awareness in the areas it operates in is low and Medall organises seminars and other means of communication to improve this. Infrastructure issues can also be an impediment and Medall has overcome this by centralising administration, through remote monitoring and by deploying IT solutions. It has also partnered with GE and Philips for tweaking its solutions keeping in mind the power limitations in rural areas. Remote consultations and strategic pricing have further helped the company’s cause.
In an experimental move, Medall has recently introduced a behavioural centre to help urban professionals and students cope with the ever increasing stress of modern life. It is slowly expanding its capability here to provide confidential support to individuals. This is just one of the focus areas for the future as there are several other plans in the making. However, Venkatraman has enough experience and, more importantly, patience to know when to take the leap. His past ventures have given him the ability to study the pulse of the market and expand quickly when required. “What is needed is an understanding of the larger picture, the openness to infuse fresh blood into the company as needed and a constant eye for growth opportunities,” he concludes.
Learning on the job
Vetri Inc.: Set up in the U.S., this venture gave Raju Venkatraman insight into establishing an international business, financing it and managing its growth. Managing people and building teams were also critical lessons he learnt from this venture. Later, with the Lason acquisition, Venkatraman gained experience in devising a strategy and executing it quickly in a constrained environment.
RevIT: Venkatraman was able to create an innovative business proposition and scaled up to 1,500 people in two years. The ICICI Firstsource experience also gained him experience of taking a company public, dealing with analysts, making it a US $400 million company, managing and growing with it.
Medall Healthcare: This was a new segment for Venkatraman – so learning quickly and expanding simultaneously reinforced the core learning from his earlier ventures. But the challenge came in dealing with rural India, where the issues are very different from an international setting, or even urban India. People management, customer management, quality control – these entities presented a different challenge in this context.
The story so far
1981 – B.Tech from IIT Madras
1981-91 – Worked in companies like Cadbury’s EDS
1991 – Started Vetri Inc., a BPO
1993 – Vetri Software (subsidiary of Vetri Inc.) for solutions development for BPOs
1999 – Sold Vetri to Lason, continued to work in strategic position
2002 – Started RevIT, health insurance processing and payments
2005 – Sold to ICICI FirstSource. Continued there as Joint MD
2009 – Exited and started Medall Diagnosticsram test