The business of people

The business of people

K. Pandia Rajan’s story is one of grit and determination. Born in a small village near Sivakasi, his father worked at a matchbox factory. Even Rajan did odd jobs during his childhood to make ends meet. But, he never gave up on his education and finding a job was top priority. After a modest education at his village high school, Rajan completed a degree in engineering from PSG Tech, Coimbatore and then an MBA in Human Resources (HR) from Xavier Labour Relations Institute (XLRI), Jamshedpur. After a brief stint in HR and marketing functions at Bharath Technologies (a clutch of 14 companies controlled by V. Krishnamurthy of SAIL and Maruti Suzuki), Rajan knew he had it in him to turn entrepreneur. On August 15th 1992, on the wake of a liberalised economy, Rajan with his wife Hemalatha Rajan, founded Ma Foi Management Consultants (Ma Foi). Rajan says, “When Ma Foi was founded, the HR services industry had not matured at all.” The biggest Indian HR company at the time, ABC Consultants, was Rs 4 crore in size. Yet, Rajan dreamed big. As early as 1991, he knew he was going to be in it for the long haul. “I wanted to build a billion dollar company and I knew it would take time. But, we were in it for the long-term,” he says.

“When Ma Foi was founded, the HR services industry wasn’t mature. The biggest Indian HR company at the time, ABC Consultants, was Rs 4 crore in size. Yet, Rajan dreamed big.”

Unique approach

The husband-wife duo invested Rs 60,000 of their savings to startup Ma Foi. The company gave itself an aggressive growth mandate. “We decided to grow 100 per cent every year, and then based on that approach figured out what services within HR we could offer.” Ma Foi’s early-stage fund-raising was unique. It took small equity from 278 individual investors, each investing anywhere between Rs 3,000 and Rs 25,000 in the venture. Rajan says, “It was a clear indication that these investors had faith in the management team.”

While at XLRI and Bharath Technologies, Rajan closely observed the global HR arena. “These global companies were extremely interesting. They thought big, there were several mergers and acquisitions happening in the HR industry and these companies saw expertise as a product.” Reminiscing the early days, he adds, “The largest supplier of expertise to the oil industry in India was an Australian company, Techniskill, and I thought to myself why an Indian company could not supply the same Indian talent.” Ma Foi, in the early stages, focused on helping engineering companies abroad hire Indian talent. A plethora of services such as recruitment process outsourcing, permanent staffing, temporary staffing, HR consulting, training, payroll, talent assessment and executive search became a natural extension. It achieved an 88 per cent growth year-on-year for the first four years, missing its 100 per cent target.


In early 2000, Ma Foi raised Rs. 8 crore in venture capital funding from three venture capital firms including Canara Bank’s VC arm. The business model was modified to become more candidate-centric rather than company-centric. Temp staffing and training became larger business units. Ma Foi also expanded through the franchise model, partnering with small entrepreneurs across India to enter newer cities.

Global merger

In 2004, Ma Foi touched the Rs. 100 crore mark, with a 4 per cent bottom line. Later that year, Ma Foi merged with Netherlands-based Vedior, then the third largest HR services company in the world, to further its growth strategy. “We liked the way Vedior functioned. It has a unique model where they worked with a light-touch approach to managing entrepreneurs world over,” says Rajan.

Under Vedior, Rajan’s global expansion plans for Ma Foi took effect. Between 2004 and 2007, it opened 18 subsidiaries across several countries in South East Asia, the Middle East and China. “Most of our global expansions were client led. We helped our existing clients setup offices in these countries,” says Rajan. Ma Foi expanded into career training services through the newly formed Ma Foi Academy. It became one of the largest temp-staffing companies in India. In 2006, it diversified into information technology and software through its wholly owned subsidiary Minvesta Infotech Ltd.

Sometime in 2008, when Randstad, the global HR services company, took over Vedior, Ma Foi become part of Randstad. Ma Foi’s subsidiaries in other countries merged with Randstad while Randstad’s Indian operations merged with Ma Foi to form Ma Foi Randstad. Ma Foi Randstad, the new entity headed by Rajan, will focus on the Indian and Sri Lankan markets.

Future speak

Today, Ma Foi operates through its 65 offices in India and Sri Lanka. It employs 1500 full-time staff and manages over 55,000 people in their temp staffing business. Its fiscal year 2010 revenue was Rs 900 crore with a close to 4 per cent bottom line. Each of its eight business units (search, selection, staffing, consulting, outsourcing, training, assessment and HR automation) is growing at a robust pace, thanks to the demand for talent in the Indian market.

Rajan says, “For us the product mix is critical. We will continue to look for opportunities in each of our business units.” By no means is Rajan done yet. And he takes inspiration from Randstad. Apparently, Randstad’s market share in the Netherlands is over 40 per cent and one in three people in Netherlands have used a Randstad service at some point of time in their careers and Rajan believes there is no reason why the Indian-arm cannot hit the same numbers.

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