Several entrepreneurship experts, even today, believe that the ideal number of people who should form the core founding team at a startup is two or three. At a stretch, it could be four. Beyond that, experts believe, it results in chaos and conflict. After all, some of the world’s best companies, including Apple, Google, Intel and Microsoft, were founded by just two or three people. But, the story is completely different in the Indian information technology (IT) services space. Infosys Technologies started the trend with seven co-founders, and MindTree beat them hands down with a founding team of ten.
Says Krishnakumar Natarajan, CEO and MD, MindTree, “The key here was there was precision on who would take the lead in each and every area of business. All ten of us brought complimentary skills to the table and we put forth exhaustive guidelines including the mission, vision statements and operating guidelines.” Natarajan also believes that it did help having founders from three different age bands. Ashok Soota, executive chairman, was clearly the most experienced and unanimously agreed to be the leader of the pack.
When Natarajan and Subroto Bagchi (vice-chairman and gardener at MindTree), had the idea of starting up an IT services company, they were already, in some sense, industry icons. Bagchi had a short stint at Lucent Technologies, prior to which he was chief executive of Wirpo’s global R&D team. Natarajan was a 17 year veteran at Wipro and was chief executive of the e-commerce division. However, both of them had the itch to start their own venture and teamed up to become the first two founders of MindTree.
The early ‘merger’
Soota actually joined the MindTree team, thanks to Som Das, who at that time was at venture capital firm Walden International, one of MindTree’s early investors. Das knew that Soota had plans of starting up his own IT services firm and knowing that Bagchi and Natarajan had worked with Soota in the past, he believed the two business plans could be combined. Soon, Soota (who was with Wipro then) joined them as the Chairman of their nameless company (at that time) on March 31st, 1999. Bagchi jokes in his report titled ‘The making of the MindTree’, “We made a merger even before we started a business.” Soota made several important changes to the business plan and most importantly, revamped the financials. The rest of the founding team looked up to Soota, and in some sense, it made Team MindTree a ‘complete’ unit.
A ten-member founding team was not the only thing that differentiated MindTree. Everything from areas of specialisation to managing people were discussed and debated in great detail. The focus was on ‘differentiating’ everything. After several discussions on the nuances of their startup, they decided on targeting the higher-end IT solutions space, focused on solving business-driven technology problems.
On Bagchi’s suggestion, the logo of MindTree, which conveyed the themes of imagination, action and joy, was actually designed by a person named Chetan who was affected by cerebral palsy. Latha, a differently-abled person from the Spastic Society of Karnataka was MindTree’s first receptionist. The founders, from day one, dared to be different and in spite of the years of experience they had in the IT industry, chose to do things the ‘MindTree way’. They did not wait to launch their social initiatives till they reached certain revenue targets, but, chipped in wherever possible. This passion and commitment that was given to every task at hand went a long way in shaping the MindTree of today.
The founders also understood the fact that, people working in a knowledge company, wanted top-notch office spaces. Some of the best designers from Bengaluru were roped in to design ‘thematic’ office spaces. Even before they landed their first project, the ‘MindTree brand’, thanks to its stellar team and carefully ‘differentiated’ ideas, became extremely popular.
By July 1999, MindTree had raised U.S. $9.5 million, from Walden International, a California-based venture capital firm and Bengaluru-based Global Technology Ventures, to set the ball rolling. Their first project came from Lucent Technologies and they helped them solve a complex technology architecture problem. The next two projects came from Avis, the car-rental company and Franklin Templeton, the world-renowned asset management firm. Their ability to deliver on these consulting-led projects for marquee clients laid the foundation for the years ahead.
People, people and people
As it should be in any knowledge-centric organisation, hiring and retaining talent was top priority. From day one, each and every employee at all levels of the organisation received stock options. Managers spent time conducting performance appraisals and ensured people within the organisation wanted to continuously learn and grow.
“We put together a set of values and all new employees had a session with Ashok within three months of joining MindTree. Constant communication played a very important role in aligning our employees towards a common value system,” says Natarajan. The senior management had a participative style and every MindTree mind (as the employees were called) was encouraged to speak up openly.
In spite of being a services organisation, MindTree put a lot of thought into building a brand. Natarajan explains, “Brand building was extremely important since it played a major role in attracting talent. We needed people who could continuously innovate. We constantly kept thinking about how we could help foster personal growth for each of our employees.”
MindTree works with NewYork-based Fordham University to conduct people perception surveys to understand what employees are looking for. Soon after the September 11th attacks in 2001, several of their U.S.-based employees were troubled by the terror attacks and worried about the prospects of the outsourcing industry. The senior team at MindTree worked with each of these employees to sort out any personal or professional issues they had.
The MindTree story is interesting for several reasons, but, there is one aspect that stands out. While mission and vision statements are considered ‘fluffy’ at most companies in India and even around the world, at MindTree, it laid the foundation for the tremendous growth they have seen over the years. The focus on people and encouraging them to achieve great things has no doubt, made the difference.