Meet Ashok Soota, this 74-year-old believes IT still has the zing
He’s now talking a $75-million revenue run rate based on the latest quarter. He single-handedly raised $53 million of venture capital.
The venture has 2,400 employees and has made two acquisitions in two months — Cupola Technology, an Internet of Things venture employing 60, and OSSCube (240 employees), ramping up presence in the US to 50 employees. Sure, this doesn’t sound like your average ecommerce entrepreneur.
But guess his age: 74. Ashok Soota, founder and executive chairman of Happiest Minds, is working actively when many his age are comfortably into retirement. And former colleagues from his Wipro days remind him of this. “He says it’s the only thing he knows.
‘I can’t sit quietly and retire,’” says Sridhar Mitta, founder of NextWealth Entrepreneurs, who was global R&D head of Wipro till 1998 and reported to Soota. “It’s about business and philanthropy. His way of doing social (work) is doing what he knows well. He has always wanted to reduce travel for business, but it doesn’t look like that is happening,” he adds, laughing.
Soota—in his sixth year of founding Happiest Minds Technologies— shows no signs of abating when he talks global IT services. “There is an old world wrestling with the fact that they are working in a technology market which is not what it was. And there is a new world in the areas of prototypes, tests and solutions. Not very big, but it will evolve into larger projects.”
Big IT firms from India have a core billion-dollar business to protect while growing in digital, where traditional clients across industries are competing with online adversaries. Internet is the default setting. According to technology research and advisory firm ISG, annual contract values in its database shrunk 4% to $22.9 billion in 2016 for outsourcing deals, whereas the software-as-a-service deals rose by 38% in the same period to $14.5 billion.
Happiest Minds is focusing on the latter, with no outsourcing legacy, which has seen companies such as Cognizant and Infosys ramp up headcount to more than 200,000. TCS is approaching 400,000. “It’s always more difficult adding on than it is starting up,” Soota says.
“We have not had to worry about legacy business, which is getting obsolete.” Counter point; their mainstay is generating cash for growth of digital business. But Soota pushes back. “Of course, but they are also seeing pressures (from investors) go all the way to buyback shares and give more dividends because they are not growing as fast as they were.” This sounds more like a feisty entrepreneur than a tiring 74-year-old. Happiest Minds is in a good zone for a venture, gunning for a 2019-20 IPO. And this is his second startup after MindTree.
In a way, Happiest Minds is trying to leverage the internet opportunity MindTree eyed in 1999. What’s changed since is end-user consumption because of people like you and me—thanks to our smartphones and other internet devices (Fitbit, tablets). Continuous online access has encroached the workplace and all kinds of data exists on the cloud. “It has taken 15 years for the move from Internet 1.0 to 5.0,” Soota notes.
“When the dotcom bust happened, many of the solutions were well ahead of their time. They were not backed by the infrastructure to make everything in real time. Now, there are many internet-based businesses supported by analytics, mobile in a very big way.” This is boosting product-engineering engagements for Indian IT companies—which Soota and his nine co-founders anticipated back in 1998 with MindTree.
His own exit from MindTree was abrupt. On January 28, 2011, an email from Soota informed several journalists about his decision to move on. For years, all co-founders have been tight-lipped about what made him leave. Speculation was rife about a fallout, or a strategic error in acquiring Kyocera Wireless India in 2009. The vice-chairman of another large IT company told this reporter in 2012, “It may have been an attempt to foray into mobility but Kyocera was more hardware when MindTree should have been thinking about services-play.”
Soota has moved on from that—it is a return of sorts to be an ‘internet consulting company’ which MindTree wanted to be. As an entrepreneur, his strengths have been clarity of thought and teambuilding, apart from affability. Serial entrepreneur Krishnan Ganesh recalls an instance when he was CEO of Bharti-British Telecom (BT) during 1998-2000.
Soota was at Wipro then and Bharti had bought the stake from the IT company in 1997. But Bharti-BT had to still get government approval for licencing. For almost two years, it operated under the trade name of Wipro-British Telecom. “Whenever there was a problem, I sought his help. He helped us in resolving problems, which is a huge thing considering Wipro had exited, and he was vice-chairman of the company,” says Ganesh, who when at HCL Ltd in the early ’90s often competed with Wipro Infotech’s personal computing business.
Mitta says Soota pays close attention to what colleagues say. “He trusts people and backs their decisions.” At Happiest Minds, Soota has brought in Sashi Kumar,48, as CEO, who channelises Formula 1 Racing and says he plays race driver to Soota’s race director. (Kumar once interned at Renault.) “Ashok makes sure the ship is on an even keel. He keeps us on a common plan and purpose.”
Advisors to enterprise clients emphasise a new way of looking at vendors— be it global heavyweights, Indian IT companies, or newbies: digital transformers. Happiest Minds will be perceived as a boutique shop in IT, but Soota stresses that the first set of trials and proofs of concept go a long way in building strategic partnerships with clients.
They still call themselves a ‘systems integrator’ to provide an overall solution for a business problem, but “the ‘boutique shop’ tag works beautifully for us because digital takes off as a trial project. Large guys have the pressure of creating a mid-sized company every year while keeping the core business growing.” Soota cites Mu Sigma as an example of a venture that has successfully made the leap from startup to data analytics specialist. Happiest Minds wants to grow as a digital transformation agent in areas such as product engineering, IoT, analytics.
This evinces the interest of traditional global companies like learning and education services giant Pearson that want to automate content, need a content orchestration platform or media players that are lightweight and so on. “We build those components,” Kumar says. For Soota, it’s about building another $100-million company, faster this time. “He exemplifies the fact that age is not a determining factor for new ideas, taking risk or putting your reputation on the line if a startup doesn’t work out,” says Ganesh, who has co-founded CustomerAsset (BPO), Marketics (analytics) and TutorVista (online education).
Recently, he met Soota at Koramangala Club where Ganesh plays tennis regularly. Soota was there for a swim. When Ganesh said it’s too cold for a dip, the septuagenarian replied: “Once you get in, the waters are perfectly fine.” For Ganesh, it was metaphorical for Soota’s approach to entrepreneurship. “Age-defying entrepreneurship is the most striking thing about him.”