July 11, 2020
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Rich & Famous In The US

Indian names are becoming more and more common in the world of American big business

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Rich & Famous In The US

IN the beginning there was disaster. When engineering student Rajesh Soin arrived in the US in 1969, the airline lost his bags and he had just 25 cents in his pocket. In the beginning there was hardship, too. High schooler Amar G. Bose sustained his family during World War II by repairing radios from the basement of his family home in suburban Philadelphia. And some beginnings were marked by quirky brilliance. While at Case Western University, Shailesh Mehta cracked a century-old mathematical puzzle. The achievement was credited to him by open-mouthed professors as his dissertation.

Others were marked by plenty of cheek. Ashok Trivedi and partner Sunil Wadhwani let the world imagine they were running a multi-million dollar business from a 10 by 10 ft office where they played boss, secretary, janitor and typist to each other.

With the beginning came responsibility for some. Young Venkee Sharma found himself inheriting his father's company when the latter died, barely 10 years after setting it up.

All those tentative beginners are today movers and shakers in the world of US business. Corporate jets have replaced airlines, logo-bearing flags flutter over the manicured lawns of company headquarters and a quarter would be handy, at best, to toss to decide between the Ferrari and the Lamborghini.

The fields they've made their mark in differ vastly, but they have one thing in common: they are interested in sharing their success—or attaining more, depending on which way you look at it—with the country of their origin. Almost all have now made tentative forays into post-liberalisation India.

FROM his gleaming offices atop a hill known simply as The Mountain in Framingham, Massachusetts, Dr Amar Bose oversees the research, assemblage and production of high-profile, high-quality stereophonic equipment—arguably the world's best. Still a private holding, Bose Corporation reports an annual turnover of over $600 million.

Bose grew up in Philadelphia. His mother was a school teacher, his father a salesman, an Indian freedom fighter forced to leave Calcutta because of his political beliefs. As a child, Bose walked to school with fists clenched and head hung (his father forbade him to fight) as white kids chanted "nigger, nigger, nigger". Today, he is thankful for that experience because it has taught him to feel for the underdog, he says.

When the family struggled to make ends meet during the war, young Amar helped out by repairing radios and did such a good job that the service grew to be one of the largest in Philadelphia. The boy entrepreneur went on to MIT. While writing his doctoral thesis in statistical communication in 1956, he decided to treat himself to a 'hi-fi' system. And found the 'E-strings' jarring and tinny. Bent on recreating the fullbodied sound of live concerts, he worked on the concepts of psychophysics and psychoacoustics—the human perception of sound—and introduced the 901 speaker series in 1966. His direct/reflecting theory of sound was based on his findings that over 80 per cent of sound reaches a listener in an auditorium only after being bounced off a ceiling, floor and walls. To market the speakers, Bose—along with MIT student Sherwin Greenblatt, now president of the company—started Bose Corporation. 

The rest, as they say, is history. The corporation has just set up shop in Delhi and will initially focus only on professional sound equipment, starting with the revolutionary new Auditioner, which essentially lets clients 'listen' to their new building in much the same way that architects use virtual reality technology to let clients 'walk through' their designs.

Softspoken Ashok Trivedi, founder of Pittsburgh, Pennsylvania-based Mastech Corporation, laughs off his success story modestly. Last year, Mastech, which specialises in systems design and development, was listed for the third time among the top 500 companies in the US by Inc. magazine. Revenues were $70 million in 1994 and projected revenue for 1995 was $100 million, having seen an impressive expansion of 536 per cent between 1990 and 1994.

Charged by several mugs of beer one summer evening in a pub in 1986, Trivedi, Wadhwani and a third pal who subsequently dropped out, decided to set up a company. "The more we drank, the better the idea got. Of course, we had done this many times before but we would always forget the next morning. This time we didn't," Trivedi recalls.

At that time, IBM mainframes still dominated the industry. But Trivedi and Wadhwani saw opportunities for a software services company focusing on the rapidly-developing Unix and client/server areas. "We dealt with the usual self-doubt, whether our concept would ever take off, but we hung in there and it paid off," says Trivedi.

Today, Mastech has 1,400 employees and nearly 450 clients among Fortune 1000 companies and government agencies. The company provides services such as application design and development, century date change, system conversions, software maintenance, offshore software development, education and training for both legacy systems and client/server technologies. Outside the US, Mastech has operations in Canada, Singapore and India.

"When we first started out, we had this small office where we did everything right from hiring employees to typing proposals. A typical day would start at eight in the morning and go all the way till one or two in the night, seven days a week," recalls the 46-year-old Trivedi. "But to all of our customers we gave the impression of a large unit. There were a lot of initial hurdles and it was so tough we came close to shutting down."

Trivedi is particularly excited about the offshore development office Mastech has opened in Bangalore. "By the end of next year, we would have invested up to Rs 50 crore in India. Our India office will be a kind of international nerve centre. We may even go into telecom technology there," he discloses.

RAJ Soin is equally upbeat about his Indian operations. He heads Modern Technology Corporation (MTC), a multi-faceted, hightech company considered a world leader in technical and engineering services. Turnover: $80 million. After the traumatic beginning at a bustling international airport in 1969, Soin summoned up his guts, common sense and got on with life. A mechanical engineer from the Delhi College of Engineering, he was now in the US to do a master's in industrial engineering from Bradley College, Illinois. In 1984, he set up MTC, spending the first year salary-less and paying employees by juggling his credit cards. Today, the company has more than 1,000 employees in 20 offices in the US, Europe and India. Inc. has it in its list of the 500 fastest growing private companies for four consecutive years.

MTC has its fingers in many pies. One division in Dayton, Ohio, is exclusively for R&D of composite materials from environment-unfriendly plastics, glass and fly-ash. From the recycled materials, MTC manufactures basketball baseboards for big names such as Huffy Sports, road and highway signs, mud flaps for trucks and bicycle wheels. The company has a medical technologies division which has pioneered—among other things—SmartWire, which can measure the blood flow and other arterial parameters during surgery. MTC also produces aluminium weldments for land warfare systems, mobile support equipment, field kitchens and automobile and escalator parts. In addition, it offers services in acquisition management and procurement outsourcing, test and evaluation, logistics and sustainment, software engineering, telecommunications and environmental software products and services.

Soin is especially proud of MTC's latest venture, its Global Technology division which specialises in customised software solutions. MTC's NEPZ, Noida, of fice, which comes under this division, produces software for a global clientele. MTC has also finalised a joint venture undertaking with the state-owned CMC Ltd called India Online to provide nationwide value-added services with an international hook-up to worldwide computer networks. Various wire services, magazines, financial data and other online databases will be on offer.

Whoever's keen to take his cue from Shailesh J. Mehta's achievements would do well to heed his advice, though some of it may make oversensitive souls squirm (see interview). The 47-year-old president of Providian Corporation (a Fortune 500 company with over $30 billion in assets based in Louisville, Kentucky) blazed a trail that was quirkier than most others and enviable. After graduating in mechanical engineering from IIT, Bombay, Mehta arrived in the US to do his masters and doctorate in operations research and computer science from Case Western University in Ohio. He hoped to go back to India and take over the family business of trading in diamonds.

During the PhD course, Mehta flummoxed professors by being the first person in 100 years to solve a graph theory problem. They declared his disssertation complete. Initially, Mehta stayed on in a variety of jobs merely to finance travel through America. But one innovative idea after another kept him on the list of most-wanted bright, young executives in the country.

PROVIDIAN is one of the US' largest shareholder-owned diver-sified financial services companies. Mehta is CEO of Providian Bancorp, a consumer banking company with over $6 billion in assets. His acumen has propelled the company to the top of the ladder and into the hallowed ranks of the Fortune 500. Among other things, he pioneered a customised credit card which took off like a rocket. In just two years, Providian has become the second biggest issuer of credit cards (after Citibank). Overall it is the 20th largest credit card company in the US today, with two-million customers and total card balances of $5.3 billion. Its pretax profit margin on those balances is 5 per cent, compared with the 3.5 per cent industry average. In 1994, the company earned $150 million before taxes, up 28 per cent from 1993 and profits have been growing faster than 20 per cent per year.

The parent company, Providian Corporation, considers Mehta's credit card division its 'shining star'. And Alex W. Hart, former president of Mastercard International, calls Mehta "one of the brightest and most able people in the payments industry".

What makes Mehta's mass customisation of credit cards so unique? The concept is sophisticated, ingenious and too simple to be true. Providian systematically sifts through data on its computers and assesses the borrowing habits of credit card users in the US (chiefly middle and lower-income consumers whose need for instant cash is so great that they are willing to overlook high interest rates). The company then mails an offer for a Gold Visa card to potential consumers, listing a range of interest rates rather than a single one. After receiving a reply, Providian once again uses advanced computer models to determine the level of bor rowing and lending the company will be able to live with in each case. Thereafter, the company calls the individual and haggles over the telephone. Yet another custom-made deal is struck.

In keeping with this meticulousness and penchant for customisation, Providian in India will spend a good year researching and weighing its own potential there. The nebulousness of the political landscape does not bother Mehta, but it certainly does others in the company. Providian would have invested more, had uncertainty over what direction the new regime might take not prevailed.

But for now, most US investors of Indian origin are brimming with eagerness to get down to business there. "India is the perfect place to set up shop," says Venkee Sharma, president of Aquatech Corporation in Canonsburg, Pennsylvania, an engineeering company which reported sales fig-ures of over $25 million in 1995 and which is currently executing four projects in India, including the Dabhol power project.

"India has many skilled engineers with decades of experience in water treatment. In 1992, the only question about opening a company there was whether we could match the quality of our systems. India—and Asia in general—did not have the best reputation in producing quality equipment. Now there is no question," Sharma says.

Aquatech was founded in 1981 by his father, Prem Nath Sharma, a chemical engineer from Benares Hindu University who came to North America in 1970 along with his wife Chandra and eldest son Venkee. After working with various US companies, the senior Sharma took a shine to Pittsburgh, decided he would like to settle there instead of being constantly relocated and set up Aquatech. Ten years later he died, leaving his wife and son to take charge of the company. Venkee's involvement with Aquatech began early: while still at school and later whilst still studying for a BS in chemical engineering at Carnegie Mellon University.

If Trivedi of Mastech decided to go for the jugular by adopting a nationwide strategy, Venkee Sharma went a step further: he went global. "It is not easy to do business internationally. The key is to offer local content, that is to produce systems as close to the job site as possible," says Sharma. "It took a long time for us to break into the market. In the early '90s, we were working night and day to be approved by a solitary Japanese customer. Many others laughed at us. Today, we are the preferred vendor for that company. And guess who's laughing now!"

INDEED, to the uninitiated Indian passing through the States, new names spring to the eye every day. Like the legendary founder of Sun Microsystems, Inc., Vinod Khosla, who, you hear, now relaxes in his palatial villa in California, eight to nine years after he left the company he co-founded in 1982. Sun today is a $4.3 billion giant in the software industry and employs 14,500 people worldwide. Sun was a pioneer in the workstation market, having launched the now-popular concept of open systems, and is today poised for supremacy in the Internet programming language market with its product JAVA. Stanford University MBA graduate Khosla had always had strong entrepreneurial instincts. He had attempted to start a company in Delhi right after getting an engineering degree. And then there is Alfred A. Knopf president and editor-in-chief Sonny Mehta, who has revolutionised book marketing. Trivedi, Wadhwani, Soin, the Mehtas—one a publisher, the other a mathematical wizard. Khosla, Bose, the Sharmas. These men and many, many more Indians in North America dared to make a go of it, placing their faith in their own abilities. But most of these topguns withdraw into themselves bashfully when asked for a surefire success formula for budding entrepreneurs both in India and in the US. Bose simply laughs heartily. Mehta uses fruit, to draw a simile, and feels it is all a question of squeezing the maximum benefits out of minimal resources.

Indeed, opportunities for Indian students in the US may be fewer as the country tightens its immigration policies and slams the bolts on employees of foreign origin. But then again, the success stories of these men may well encourage others beginning the long, hard climb to clamber aboard faster. If nothing else, they will act as an eye-opener to anyone who might think that India, overseas, is a nation made up entirely of people on the run from supposed political persecution and economic hardships, of newspaper vendors and cornershop owners, not squeezing lemons and drinking lemonade, but selling it instead. 

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