12 Family Business Heirs on Navigating their Way Tomorrow Inc - Class of 2021
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When a new family member enters a business it brings issues of a newer generation. As the pandemic stuck last year we saw what kind of transitions these gen-next leaders made to sustain businesses. We also saw a humane side of theirs coming forward and showing a different kind of leadership. This test of time gave them enough room to think about what role they can play to keep the family legacy alive and newer changes they could implement. While businesses would have undergone drastic changes, family values remained uncompromised. The current issue, being the fifth edition of our annual "Tomorrow Inc' edition aims to understand the entrepreneurial spirit of the new generation of the family business and how they can build business for the new-age economy.
(This article was first published in the September 2021 issue of Entrepreneur Magazine. To subscribe, click here)
Amrish KumarTHE MAN BEHIND THE DESIGNER LABEL
Amrish is a second-generation entrepreneur, who was challenged to grow a largely "boutique' business, started in 1971 into a highly successful, pan-India women's apparel company with brands spanning global fashion, Indian contemporary, and Indian couture brands. In 2007, he launched "Label Ritu Kumar', a western wear brand that marked the beginning of their move into mainstream fashion. Today Label, boasts of more than 50+ stores, across India. He is also responsible for modernizing and expanding the legacy product line into two different brands for prêt and couture. Amrish launched Ritu Kumar Home in 2019 and also launched aarke by Ritu Kumar in 2021, a brand with Indian wear sensibilities that will bridge the gap between designer wear and accessible price points. When asked what drew him towards the business, Kumar says, "Two things drew me in; first on a very commercial level is the potential of being able to drive a business and brand of my own. When I came to the family business, back then there were only 12 stores. Secondly, there was always a connection with the artisanal nature of our business because it was around since I was very young. It has its own character and name and is unlike any brand in the industry. This was the most subliminal kind of motivation." Over the years he has developed the infrastructure and functions verticals. He has also helmed brand building and marketing.
After a successful fundraise, from Everstone Capital in 2013, Amrish took on the role of CEO and drove the day-to-day operations across multiple functions including design, supply chain, E-commerce and operations. Talking about some of his bold moves at the company, he shares, "I have launched four segregated brands and now we are a family of five brands. We have worked on our e-commerce presence, our websites. The business we gain from there is larger than what we gain from our market business." In the last five years, the company has consistently been able to deliver 20%+ top-line growth and grow touchpoints to 100+ across 30+ cities in India while consistently expanding the brands' online presence in key markets of the USA, UK & the Middle East to become one of the most recognized women's fashion apparel brands. Simultaneously, Amrish has successfully, transformed the company from a largely promoter-run set-up into an institutionalized, professionally run the organization while driving innovations.
Wagh Bakri Tea GroupTHE CENTENARY TEA MAKER
Parag Desai happens to be a fourth-generation entrepreneur, wherein he was exposed to the business since childhood. "I remember the first time when I was taught (professionally) the art of tasting tea. I was in my teens. The entire process was explained scientifically and then was exposed to the art of taste. That has stayed with me even today," recalls Desai. Desai was filled with ideas and had some aggressive plans as he never thought about any other career than to join the family business. Desai was keen to study consumer behavior and forecast future demands. Framing the strategies and planning to implement them at the right time was equally exciting. At the product level, he took the range to the next level. "Today, we have a wide range of Green Teas, Exotic Teas, Iced Teas, Instant Premixes like Cappuccino & Haldi Doodh, etc," he adds. At the brand level, he gradually redefined the group's traditional or conservative kadakmithi (strong and sweet) chai along the way. Their latest campaigns #SisterWaliChai & #DadWaliChai got an overwhelming response and were relatable to the younger generation. Sharing more on the innovation front he says, "We have already ventured into QSR Outlets with Wagh Bakri Tea Lounge." Wagh Bakri Tea Lounge carries forward the legacy of 100 years old Wagh Bakri Tea Group in a modern avatar. The lounges are spread across the country in cities like Ahmedabad, Vadodara, Pune, Mumbai, Gurugram, and Goa. Sharing more on his bold move Desai says, "Back in 2002, when Café culture was booming and going to a Café was becoming a style statement. Tea was still a Keetli culture. We launched the Tea Lounge to increase category aspiration. Going to a Tea Lounge to drink the best quality tea with a rich ambience experience was quite unique and bold." Currently, the brand exports to 40 countries and is now starting to introduce complementary products like quick snacks, sugar, new age instant premixes. As Desai says, "We will continue spending time to understand the preferences of our customers to remain their preferred and trusted choice."
MapmyIndiaMAPPING THE NATION
Rohan Verma's earliest memories of the business environment began at home. "I was less than 5 years old when I remember my parents working on IBM mainframe computers. They would work long hours in a few of the rooms of our home, which was their office – training other people in building software at our office, or going to visit a client outside Delhi. Throughout my schooling days from class 4 till class 12, after school, I would visit the office on many days and see them digitizing maps, building mapping software, making marketing material, and sometimes I even accompanied them to exhibitions and product launches," shares Verma. After his class 12 exams and before he headed off to Stanford, Rohan interned at the office and his first work was to learn about digital vector maps and convert them to GPS device ready formats so that the digital map of some part of India could be loaded into a GPS device which someone wanted to use for waypoint navigation. After his first year at Stanford, he spent the summer of 2004 working on building out India's first interactive mapping portal, MapmyIndia.com, along with his team. Launching MapmyIndia.com at the age of 19 was his full-blown introduction to the business. His induction in the family business was with the aim of democratizing access and further growing the benefits of digital maps and location technologies to everyone. So he got involved with launching the consumer-facing internet mapping portal. Then next he was involved with launching the GPS navigation product, a new category for India, which brought immense benefits to consumers, who could rely on a digital companion and navigator while traveling to not get lost and reach their destination safely and efficiently.
Bagrry’sBUILDING THE HEALTHY BREAKFAST CLUB
As a second-generation in the family business, Aditya was fortunate to observe the business from a very early stage. His family has been in grain milling for over 50 years and his father established a B2B business with marquee customers before launching Bagrry's – their flagship brand of breakfast cereals and health foods. Sharing his childhood memories from the retail brand created in the early 90s, Bagri says, "As a child, I saw my parents work endlessly on building the brand and the product range. From developing the in-house technology to process oats, unavailable in India back in the 90s to promote the products in several trade fairs, expand distribution, it was a master class on entrepreneurship." Aditya joined the business after completing his master's and having worked for a short while in the banking sector. The first few years were a period of steep learning, starting out from the sales and marketing function, he was gradually introduced to every department of the business and is now mandated with building the flagship FMCG vertical.
Talking about the potential he saw in the business, Bagri says, "Our business category is a future centric one with more and more consumers looking for healthy alternatives." He is now looking at adding new lines that are consumer-focussed, expanding the reach both domestically and internationally. Some of the initiatives he took were to expand the portfolio from a niche breakfast cereal brand to a complete portfolio of breakfast cereals and health foods. Recently, the brand built its own D2C platform with products that are online first and have the potential to scale.
Tally SolutionsTHE NEW-AGE SMB SOLUTION PROVIDER
Tejas Goenka never wanted to get into the family business, and his parents also never expected him to, either. But as luck has it, he became interested in the big dreams they had, the way they thought. His first memories included showing up to the office in casual wear to attend some meetings that really showed him how the company thought and what the company believed. Those few meetings helped him decide that this is really what he wanted to do. From there he remembers being thrown in the deep end, left to figure his way out. Sharing his thoughts on introducing changes in the family business, Tejas Goenka, Managing Director, Tally Solutions mentions, "I think the initial few months were tough to just participate. Most of the company looks at you as a person with no credibility being trusted to run the organization, and so the first thing you have to do is really spend time to gain the trust of the team. Once you do that, a lot of changes and things get easier. Bringing in any big change is always an interesting problem, challenging in some ways, but fun nonetheless! So I think if you think about bringing change as a problem you need to solve, things become easier and easier." Joining the business a decade back, Goneka gradually moved to the position of Managing Director where he now spearheads the Research, Engineering, Product Management, Strategy, and Business Development functions in the company along with Tally Education.
Talking about the newer tools which he is working on to build the business, Goenka says, "We are currently in the middle of imagining and building what we think is the next big shift we can bring for entrepreneurs, and are excited to expand our reach both in India and the rest of the world with this." Tejas focuses his efforts on bringing in greater strategic and operational effectiveness across the organization. Sharing some of his bold moves, Goenka says, "Most businesses like ours have taken the route to sell digitally, but our belief has been that in a country like India, an ecosystem plays a very critical role, and will continue to play a very critical role. Another has been the willingness to step back and really rewrite our technology stack from scratch – this is the big change we are in the middle of. This is both nerve-wracking but exciting, and more importantly something that simply must be done.
Cello WorldNURTURING A LEGACY OF VALUE CREATION
With differentiated products, building on core strengths, acquisitions, and operational overhaul. Gaurav Rathod, Managing Director, Cello World, started as an intern in the stationery division of their family business about seven years ago. From building and leading the small home appliances division, Rathod braved resistance and reformed the business by introducing an HR team, digitalizing sales and having an e-commerce team. The new-age entrepreneur has maintained their leadership position even during the pandemic and is focused on offering differentiated products. On re-entering the stationery business, the third-generation scion of the legendary enterprise already has other initiatives for the division.
On Re-Entering
The Stationery Business, Its Structuring, and TG Rathod say, "It is going to be a completely professionally-run company with a proper CEO. There will be no family intervention at all." "We understand the business so well; the expertise is already in-house. It is very easy for us to supervise the operations. Also, we will introduce better-valued, mid-to high-level products."
Challenges On The Entrepreneurial Journey
Reminiscing on the time when they decided to enter glassware, Rathod says, "Glassware was very alien to us. To put up a very capital-intensive, technically challenging factory is one of the most difficult things to do. Also to get the plant going and getting people motivated for the glassware project was the toughest challenge." With just 14 glass plants manufacturing opal ware (glassware) worldwide, Cello ranks No.2. "And I think we are heading in the right direction. We built it up pretty nicely and quite quickly. We have achieved a lot of things that our competitors achieved in a very long time." This move also established them as a manufacturer of diverse materials from, plastics to glassware and now steel. "So we are now basically a complete household or a complete household product brand." "As for Covid-19", he says, "Except for a temporary shutdown in Q1 FY2021 and two sluggish months thereafter where we came with smaller capacities initially, we were back in action completely by October 2020. Even today, we would touch about 85% of our sales last year which is pretty good. Today we are operating at almost 110% -120% just by efficiency increase".
On Their Future Plans
Rathod says, "For the next five years, we are looking at glass majorly; more of glass manufacturing units. Then there are expansion plans for steel flasks and Kleeno, our cleaning-aid range." "Focus on plastic portfolio and household thermoware will continue. We will explore exports of stationery, opal ware in a big way." Talking about acquisitions he adds, "You need to have some inorganic growth at times, and we will look at companies with synergetic product portfolio." "Also we have been thinking about manufacturing steel pans and pots; then there are plans to put a soda line project, where we will manufacture drinking glasses in India." Looking to stay on top of the digital game vis-a-vis competitors, Rathod is looking to sell directly from their portal.
Birla Precision TechnologiesEXCELLING ENGINEERING
Since the age of 17, Vedant was always made to come to the office after college by his father Yash Birla. "Though I resented it at the time, as I wanted to be like all the other kids my age, in retrospect that was the best discipline for me as it eased me into the overall office culture and life," recalls Vedant who has vivid memories of learning the traditional manufacturing business. His grandfather Ashok Birla created many pioneer collaborations for the country like Birla Yamaha, Birla 3M, Birla Kennametal. These all were always there at the back of his mind. As a gen-next leader, he is also rethinking the family business. Birla shares, "From the time when I studied and worked abroad, I had got two learnings. First was to always put 2% of your Profit into R&D. So, in Birla Precision, I tried to therefore see how we could focus more on new technologies, for example, we developed and launched a High-Performance range in one of our divisions, called "Panther', and entered into the Hydraulics space for the first time. The second learning was to get as much possible onboard new forward-thinking professional talent, and give them ownership to implement their learnings by empowering them and then getting out of the way." In the Tool Holder division, he moved into the Capital goods space and therein entered the manufacturing of items like Angular Heads, Rotary Coolant Adaptors which were total import substitutes. Some of his bold moves have been investing in expanding production capacity by almost 50% in one of their best-selling lines in one shot. Talking about the changes he made, Birla mentions, "We retained much of the focus on Automotive as we felt that is a winner space to be in India, as Auto component manufacturing will always remain the darling of the Indian manufacturing industry. What we tweaked a bit was increasing the degree of decentralization of much of the corporate functions and decision making." Birla had to do quite a bit of trial-and-error and made a lot of mistakes, but having a supportive father gave him basic autonomy to create his own experiences and learn from them.
Radha TMTMAN OF STEEL
There is a saying in the Marwadi community that a child is inducted into the family business when he/she is born. Akshat Saraf was surrounded by business people all his life. "I remember how I would accompany my dadaji and nanaji to their factories, and just sit there and observe what was happening, even as a young primary schoolboy," shares Saraf. Having one of the largest and most technologically advanced mills in India, they are expanding into new product lines. They are about to launch three new grades of TMT and several alloy steel products in the future. "We have undergone backward integration a few years ago, acquiring sponge iron units in Karnataka that helped us gain an end-to-end integrated manufacturing system which further helps control and enhance quality. We are also in construction and real estate development, in both the commercial and residential space, and continue to see strong and steady growth in that vertical as well," mentions Saraf.
Navigating the waters of a family business is a very delicate art comprised of respect, culture, dedication, and communication. When asked about introducing changes, Saraf says, "The core values of our company- honestly, integrity and quality have and will always be retained no matter how much we changed.
However, a big shift has been to hire more competent staff in order to free the directors and top management from day-to-day mundanities to making more strategic decisions has been a big shift. It is not easy to shift responsibility, but it is vital, as there are only so many hours in a day, and effective time management is key to being successful in any activity one partakes in." Saraf looks after the company's overall sales and marketing both for India and abroad. Under him, the company has opened their Maharashtra office for sales both national and international and is also betting big on exports of their products. Talking about implementing newer technology he says, "In terms of technology- I think our biggest achievement is having a fully automatic production process in our steel business."
Sona MandhiraGEARING UP FOR GROWTH
Mandhira Kapur, Chairman and Managing Director, Sona Mandhira, was just 12 when she first visited a manufacturing unit and developed her interest in the process. The second-generation entrepreneur, born in a business family, imbibed the importance of discipline, integrity, and commitment in life from her father, Late Dr. Surinder Kapur. After being the creative force behind many national and global brands, curating a variety of marketing and branding strategies, in 2020, Mandhira added another feather to her hat by taking up the role of Chairman & Managing Director at Sona Mandhira. She is currently spearheading transformative initiatives at SMPL to ensure the brand becomes a leading provider in the aftermarket space. The company was initially formed in 2012 which was inaugurated by her father. Her dynamic approach has turned the creative concepts of the company into reality through cutting-edge technologies and services. SMPL works through a distribution network catering to Tier-I, II, and III cities. The company ensures on focusing that the brand is relevant and innovative in the entire information technology gamut. Keeping itself abreast with digital technologies, the brand has updated itself with much technological advancement to reduce manual intervention. It has helped the brand to stay ahead in the competition. Initially, the brand started with aftermarket suspension and steering components and now has expanded into other components within the four-wheelers and commercial vehicle space. SMPL is an aftermarket automotive brand and we operate in a B2C format.
Mandhira's dynamism on the pitch translates into her pursuits off the pitch. With her strong value system and new perspectives, she plans to take SMPL to new heights and transform the aftermarket space. Her strong dedication and efforts to ensure the brand's success has been enshrined in the sustained improvement in the organization's performance. Her commitment and conviction have kept the team inspired. "Sona Mandhira believes in an open-door philosophy and makes sure that everyone is as approachable as possible. We take time for people, we ask questions, listen, and make ourselves accessible. This creates personal connections with our employees that we believe are critical to our organizational success and the happiness of our workforce," she adjoined in a statement. Mandhira remains the backbone of the brand and ensures that all the products are reliable and of superior quality by adhering to best practices. The checking process involves multiple steps to ensure the product is genuine and durable. The brand ensures focused quality control across all the processes. The processes are viewed in the light of how a step might be done faster and better to improve the overall efficiency.
Goldmedal ElectricalsSWITCHING GEARS
For Kishan Jain, the business was always a part of family discussions. A lot of the meetings would also happen at home. "I remember listening intently to everything. As I grew older, I was encouraged to participate in more such discussions at length. My brothers and I would often visit the manufacturing units and offices to understand the inner workings of the business," recalls Jain. Jain was drawn to the potential of Goldmedal to make modern, high-tech, and innovative electrical products accessible to everyone.
Talking about rethinking the family business, Jain adds, "Any rethinking we do is in terms of technology and scope of operations. We have also invested in developing our own branches throughout the country. We have thus moved away from the distributor model to the branch model." Goldmedal now has offices in 22 states and is a pan-India brand that supplies products to every state in India. Going ahead, they will be investing heavily in AI and IoT solutions - both for products as well as the manufacturing process. Sharing Future plans Jain adds, "We have ambitious plans both in the wiring devices category as well as in the LED and appliances segment. Home automation, IoT-based fans, smart LEDs are just some of the things that we are working on. Going ahead, we may expand into foreign markets with these products." Goldmedal Electricals recorded a turnover of INR 2000 crore last financial year despite the pandemic.
Ladhani GroupBOTTLING IT UP!
Paritosh Ladhani's early memories of being introduced to the family business include his family being in the beverage business as Thumsup bottling partners. "I vividly remember the discussions about market coverage, distribution, and usage of various other industries as early as since the age of 9 years," shares Ladhani. The excitement of being part of a multinational company, albeit as a vendor, in the early 90s drew Ladhani to the family business. He used to attend the Company meetings very often when he was barely 15. Today, the group is the largest bottling partner of Coca-Cola in South Asia and the fastest growing bottling partner in the world for the last five years. Talking about one of his bold initiatives at the company, Ladhani mentions, "One of the bold moves by me was to professionalize the company about 10 years back. My energies went into hiring the best in industry, giving them the perfect work culture so that my family and I could focus on growth and strategic development." Going forward, he aims to get into the F&B space by launching few international brands in National Capital and expand the Coca-Cola business vertically and grow exponentially. Ladhani is also looking at building premium boutique hotels with the IHCL group, the current one being Taj F Hotel & Convention Centre, Agra.
LXMENEXT-GEN WEALTH CREATOR
As a child, Priti Rathi Gupta would spend hours in her grandfather's shop, which was a proprietary firm. Her earliest learning from that time was that an entrepreneur's clock is bound to relentlessly following opportunities. Unlike a 9-5 job, he has to be at the time and place that the opportunity exists. "Once I finished school, my father, who was then a professional, would call me to his office to maintain all investment portfolios. This was my first introduction to a large professional working environment. In my late teens, I interned with my uncle who is a stockbroker. This was, what one would call a start-up in today's age. By the time I was 18, I had experienced a fair share of different business environments," recalls Gupta.
As her father's business needed someone with previous experience in Stock Broking, and Gupta had the relevant experience, she jumped at the opportunity of being able to set up a business from scratch. In the last decade, she has transformed Anand Rathi into a "Family led and professionally run" conglomerate. All their businesses are helmed by professionals with technology being an enabler for business. Talking about new growth prospects, Gupta mentions, "In this decade, we are reimagining the business, given our ability to now grow via acquisitions, as well as enter into verticals that provide us with synergies." She now envisions a business that offers a seamless customer journey across both online and offline channels. Her bold moves include setting up a preferred channel for converting trading clients into financial planning customers, uncomplicating the Private Wealth offering to help meet the clients' wealth objectives with simplicity yet as much effectiveness. Her latest initiative is a woman focussed social fintech, LXME (Lakshmi) targeting only women and powering them with financial acumen and investments. On future plans, Gupta says, "Our growth strategy from here on is multi-pronged. On one hand, we are looking at increasing our reach through acquisition in Wealth management, NBFC as well as Investment services. These will also include extensions of business lines. On the other hand, we are using technology to drive hyper-personalization across our investor base. Lastly, we remain focused on hiring and empowering talent that can challenge and grow the business."
