Bengaluru: Mu Sigma Inc. founder Dhiraj Rajaram has taken charge as chief executive officer (CEO) of the data analytics start-up he calls India’s only profitable unicorn, replacing his former wife Ambiga Subramanian after buying out her stake in the firm.
Rajaram has also entered into an agreement with Subramanian to buy back her holding in the company—a deal that will make him the single largest stakeholder in the company with a 51.6% stake.
Rajaram, who made the announcement on Tuesday, did not disclose who funded the deal. He and Subramanian both held a stake of around 25.5% in the company before the deal, he said. The announcement came within months of Rajaram’s divorce from Subramanian in May.
Subramanian, who held multiple roles in Mu Sigma, including director of innovation, head of talent management and chief operating officer, before becoming CEO in February this year, will continue to serve on the board in a non-executive capacity. It was not immediately clear if Subramanian will continue to be associated with the firm once the transaction is completed.
“Due to personal circumstances, it is time for me to move on from the management team of the company and do something different. All rumours about me starting a competitive firm are untrue,” Subramanian said in a statement.
Mint first reported on 21 September that Dhiraj Rajaram plans to acquire control of the firm by buying out the 48% owned by his former wife Ambiga Subramanian and private equity firm General Atlantic.
There has been some uncertainty over the future ownership and management of Mu Sigma, one of India’s hottest start-ups and earliest unicorns, valued at more than $1 billion, after Rajaram and Subramanian finalized their divorce in May.
Founded in 2004 by Rajaram, who previously worked for consulting firm Booz Allen Hamilton, Mu Sigma raised about $178 million from investors such as General Atlantic, Sequoia Capital, Mastercard Inc., Fidelity Investments and Accel Partners in three rounds since 2011. All the existing backers, including General Atlantic, will stay invested in the firm.
“There has been a lot of needless and inaccurate speculation around our involvement in Mu Sigma. We are extremely excited about being a partner and shareholder with Dhiraj and his management team and look forward to continuing to help build the company for many years to come,” Mark Dzialga, chairman of General Atlantic, said in a statement.
The divorce between Subramanian and Rajaram followed the departure in July last year of managing director Ganesh Lakshminarayanan, who had joined the company a year earlier. Mu Sigma had hired Lakshminarayanan, former Dell India president and managing director, in 2014 to lead its Indian operations. Chief financial officer Atul Bansal left the firm in March 2015.
This apart, a string of senior executives have quit the firm since April this year, including Goutham Ekollu, head of operations; Anuj Krishna, a nine-year veteran at the company in charge of the company’s business on the East Coast of the US; Aditya Kumbakonam, delivery unit lead; Manu Sharma, associate director; Adarsh Kumar, delivery leader; and Sankar Sekar, apprentice leader.
“It would be incorrect to say there has been no impact (from the separation between Rajaram and Subramanian). But the focus continues to be on the good work we are doing. There is a lot of demand for the narrative that we are offering. We have been one of the last companies to have started in the space. Mu Sigma is not about cost arbitrage. It is about innovation arbitrage,” Rajaram said. He declined to comment on the company’s valuation and revenue.
The firm was valued at $1.5 billion when it raised $45 million in February 2013 in a round led by Mastercard. In an interview to Bloomberg in April 2015, Rajaram had said the company aims to increase annual sales from $250 million then to $1 billion in the next five-seven years.