New Delhi: It’s a bird’s-eye view from the 16th floor of the Hindustan Times building on New Delhi’s K.G. Marg. Through the muted glass of the Mint office, one sees Connaught Place melting in the midday sun. Ashok Trivedi manages to look crisp and fresh in his navy-blue blazer. Sitting across the table, the President and co-founder of iGate Corp and an angel investor, talks about his journey from the heady days of Mastech before the 2001 crash to the more mature success of iGate.
So, how are things going for iGate? Ask him about the inclusion of group company iGate Global Solutions in the newly created list of Global Growth Companies at World Economic Forum’s recently concluded summer summit at Dalian, he waves a lazy hand and agrees that it is a milestone, adding that it will definitely energize the management!
iGate Global Solutions also figured in the top three ‘best employers’ list’ in DQ-IDC Best Employers’ Survey of 2007. Sipping a black coffee, he agrees that Phaneesh Murthy “makes a great difference and that we need a person like him - young, motivated and armed with the right experience to continue the good work.”
A member of the Band of Angels,Trivedi is optimistic about the young Indian entrepreneurs. Mastech was started by Trivedi and Sunil Wadhwani in 1986. Following the 2001 market crash, it metamorphosed into iGate, riding a different business model. Presently, the group includes iGate Global Solutions (an integrated Technology and Operations company), Mastech (global recruiting and technical resource management company in niche areas), iGate Clinical Research (one of the first clinical trials management companies to establish operations in India) and RPO worldwide (recruiting performance optimization company). The market-cap of iGate Corp as on 18September stands at $483 million.
Excerpts from the interview with Nandini Sanyal
Tell us about your journey at iGate.
It has been a most interesting journey. It had all started with Mastech. I remember, how in the ‘80s, without any outside capital, we created a $100-million company. By 1996, we were listed on Nasdaq and by the year-end we had grown to an almost $500-million company. Soon after, we caught the Internet fever. We did many interesting things, sowed many businesses, went for IPOs and by the end of 2000, had 14 Internet- related companies. Now after many divestments and mergers, iGate has a few companies under its banner.
Were there many blips on the way?
Oh, yes! Lots of blips and moments of self-doubt. The most significant was of course when we started the business, in the late ‘80s. We went for the open system or Unix when it had less than 5% of market share. I always thought Unix would take off. Whenever you are dealing with an emerging technology or new business model, you cannot afford to be either too early or too late. The timing must be just right. Thankfully, we survived. We were true to our vision and we strongly believed in what we were doing. We had a similar experience in 2001-02, when at least in the US, the whole world was falling apart, or so it seemed. However we stayed on course and that worked out well. We are now on a growth path and are firing on all cylinders.
Mastek was a $500-million company in 1990s. What about iGate?
Mastek was a company that existed in 2000. It had several divisions focusing on ERP, offshoring and network solutions. All these divisions were turned into independent companies and the name was changed to iGate.
In 2000, we acquired or started 5-6 companies in the Internet and e-services space and by 2000, we had 14 companies. Of them, about eight were different divisions of iGate. The morale was high among people and 20% stock options were set aside for all these firms. Vice presidents who were so far running divisions, were turned into CEOs and the idea was to make those businesses public as we went along.
To maintain that structure, a strong capital market was imperative. But just then, the financial markets crashed and we had to completely redo our strategy.
Are you thinking about diversifying into a new area? You already have companies in allied fields.
We have always looked at new areas to expand and diversify into. Three years ago, we entered the realm of clinical research - iGate Clinical Research focuses on clinical trials and clinical data management. Whenever we find something interesting, we either acquire a company here or abroad or go for a Greenfield operation.
Did you ever think of getting into the R&D lab business for pharmaceutical companies?
We did explore that option but decided against it.
Is there any company which is presently on your radar for a takeover?
Nothing big at the moment.
You had at one point set up an incubator fund to help establish start-ups.
Back in 2000, we started a $75-million venture fund which provided incubator assistance.The timing was not right and with the market downturn, we had to change course, shut the VC firm and close the process of incubating new companies, and instead focus more on India-related businesses.
You changed your business strategy and evolved from Mastek to iGate. What is the next step?
Over the next few years, we will be focusing on our current strategy. Now, we have come to a point where almost all the cylinders are firing. We will continue this process and then take a look 2-3 years from now.
How has the journey so far been for Ashok Trivedi, the man?
I would say, very rewarding and interesting. I went to the US in 1973 for higher education. Like a lot of NRIs, I did my Masters in Business Adminstration and took up a job. It so happened that the first job turned out to be in the software sector. For some years, life was serendipity! I did that job for 10-11 years. Sometimes things just happen. All along, there was a strong desire to start my own business. While I was still in my 30s, I felt I had to start now or I will not have much energy left. It was then I decided to start Mastech.
At first the focus was on raising money. There was a mild recession in the US in 1987. We took a decision to stop spending time raising money and spend it on looking for customers who would probably end up funding the company. Soon enough we managed to get customers and we also ended up funding the company. By the time we went public on Nasdaq in 1996, there was no outside funding. We were one of the rare IT companies where there was no outside capital, no venture fund. The company was puking cash!
We wanted to grow and because we were a $100-million company, we wanted to reach the $500-million mark before 2000. To do that, we needed good management. I did not have the experience to run a large company. Though we had started the business centre, we had a shortage of management talent which we had to get from outside. People were not exactly jumping to join the company. So we had to make it work and the key to that was stock options.
We had to go to the public, create a certain image and focus on lines which were doing well at that time and it was outsourcing that emerged, with us having a presence in all five continents. We added several other service lines and started investing in India at that time.
Where do you see yourself 10 years from now?
Other than business, I would probably be involved in areas I am passionate about now. Education, for one. I have been helping schools in an unorganized way but now hope to do it in a more organized and structured manner.
What about the next generation?
I have three daughters. The eldest daughter is 23 who is ready to join work. The second one is in college in Boston and the third is in India in the American school, ready to pass out next year. They are free to take up whatever their hearts desire. My youngest daughter loves acting and takes key roles in school plays.
The coffee’s over by now. As the interview draws to a close, the sun seems to have mellowed. But Trivedi seems to have stronger views about India: “I am optimistic about India. With a growth rate of 9%, we can only go ahead. After all, we can’t be in a ‘developing’ mode forever.
However, he does express doubts over the rather noisy nature of the Indian democracy. As if to prove his point , the sound of evening traffic builds to a crescendo and breaks into our air-conditioned eyrie.