'An entrepreneurial revolution is taking place in India'

K Pandia Rajan, the Chairman and Managing Director of Ma Foi Strategic Consultants Pvt Ltd, is a revolutionary in the HR staffing, consulting and recruiting space in India. He along with his wife Hema Latha, a Chartered Accountant by profession started Ma Foi Management Consultants with just Rs 60,000 in 1992 and took the company to amazing heights with offices all over the world and providing employment opportunities to over 4 lakh people in two decades.

After Ranstad, the second largest HR company in the world, acquired an equity stake in the company, the couple exited from the company to start Ma Foi Strategic Consultants Pvt Ltd in 2012.

The new company has three verticals: Analytics, Consulting and Education which they plan to make a Rs 1000 crore company in 10 years.

Pandia Rajan is also a Member of the Tamil Nadu Legislative Assembly.

In this interview, K Pandia Rajan, an expert on the employment scene and recruiting, spoke with Shobha Warrier on the buoyancy in the Indian economy and what youngsters can look forward to.

Experts say that the lull in recruiting is over, and more and more companies are ready to recruit fresh graduates. Does that mean Indian economy is on a revival mode?

Yes, the last four months have been very good and there is a big revival in recruitment. The recruitment process is a lead indicator of the economic growth in a country. We had a 5.7 per cent growth in Q1 (April-June 2014) this year but we could see the reverberations a quarter earlier to that. We could feel that from the number of requests for placements and positions.

In which sector do you see positive growth?

The automobile sector is clearly in a recruitment mode. Also the technology based enterprises. The technologies that are really generating jobs are in the confluence of social media, mobile, cloud, analytics and internet.

Of course, there will be vibrancy in manufacturing after the Make in India campaign (initiated by Prime Minister Narendra Modi in his Independence Day address o the nation). I have great hopes in the $35 billion investment promised by Japan and also, the $20 billion promised by China. Now, you will have huge inflow of resources. I think we will give China run for money as the manufacturing base of the world. You will soon see a flow of businesses from China to India.

I also see entrepreneurial activities very high especially after the Modi government came to power.

From where do you get the vibe that entrepreneurial activities are very high?

I am a member of TiE (The Indus Entrepreneurs) and recently we did the Pitch Fest and I see fairly strong revival, almost like the dotcom boom phase of 2000-01. Many state governments like Kerala, Tamil Nadu, etc. are coming up with schemes to attract entrepreneurs.

How important is the role of entrepreneurs in reviving an economy?

Ultimately, entrepreneurs are the drivers of economy and not public enterprises. When was the last time a new public enterprise was started? I don't think this is an era of government-led growth. An economy has to be driven by private entrepreneurs and it is happening now.

The seamless integration of the tiny sector driven by the self-help groups like Kudumbashree of Kerala and Magalir Thittam of Tamil Nadu, is assuming a critical size.

In 2000, when we took VC funds, there were hardly 8 of them but today, there are 156 venture capitalists. I would say, today, ideas are chased by money. Angel funding and Angels being available as board of directors, have never been this strong. I have been seeing entrepreneurial ecosystem for the last 20 years but I have never seen this kind of ease with which an entrepreneur is able to start an idea. Right from the final year in college, if you have a business plan, you are encouraged to go ahead. There are enough mentors, enough venture capitalists, and enough angels. That is why I would say, an entrepreneurial revolution is taking place in this country.

Do you see interesting ideas coming up also?

Yes, personally my wife and I have invested in 14 companies. We have played angel to 14 ideas as part of Chennai Angels and separately also.

What will be your advice to a youngster who wants to be an entrepreneur?

First, s/he should get connected to fostering institutions like TiE, get mentors and understand what kind of funding options are available.

I always advice them to form pairs and start an enterprise. When you are young and fresh from college, it is always better to have one or two like-minded partners with you. It helps when two heads think together. The emotional support you need as an entrepreneur is a lot more than the financial support.

I have noticed that close to 50 per cent of businesses die before they see third year. If you survive the first three years, the chances of your survival and growth are very high. Those are the times you need a shoulder to cry on and a hand to support you. I rarely see an enterprise dying where there are three or more people. They may fight among themselves but they will not die. So, I advice everyone to find like-minded partners who will work with you, invest with you and take the risk with you. With a partner, the burden is shared.

The third thing is, you don't need an earth shattering idea to start an enterprise. You don't have to be Einsteins and Newtons to start a company. It can be a simple idea. In fact, most of the powerful ideas are simple ideas. But it has to be something on which you can put your faith on. You don't have to do something that no one has ever done.

In our case also, recruitment has been there always but we did it differently, efficiently, and in an innovative way. So, I will advice youngsters not to look for that earth shattering idea; that will only paralyse you.

Remember, where you begin and where you end may be different. Look for the verticals and horizontals that emerge and move accordingly. Keep your mind alert to the changes that are happening. Technologies may change and with each change, it will bring in new possibilities.

Don't ever become uni-dimensional; business has three dimensions: scale, scope and depth. The moment you make your business uni-dimensional, you are risking yourself.

One complaint we used to hear from the industry was that Indian graduates are unemployable. Are they still unemployable?

The huge mass expansion in engineering and other disciplines happened very quickly and dramatically. So you had people with very low level of skills coming into colleges and colleges didn't take the effort to build skills. It is changing now. There is a mismatch in what industry wants and what universities churn out. Because of the acute competitive pressure among the engineering colleges, finally there are investments going in this direction.

According to me, kindling entrepreneurial skills early is more important. They can be job creators and not job seekers. In my opinion, there should be no college without an entrepreneurship development centre.

Do you see a revival in the global economy happening soon?

I think world is at a boiling point. Never before in the history of the world other than during the World War period, you had five simultaneous wars happening as it is today. I think the world need to go to a new normal. The geopolitics of today, in a way shrunk the world economy and growth rates are falling for the last three years.

But India should get back to the new normal of 7-8 per cent growth. This year, we may end up with 6 per cent growth. I also feel 7-7.5 per cent growth next year will be a reality. The sentiment is very positive and people want to invest. Of course, our country is very dependant on monsoon. But I am very positive about industrial and entrepreneurial growth.

Which country, do you think will be the driver of global economy?

Even today, it is the US. When our economy is only $3 trillion, they are $35 trillion. That means US economy is 10 times our size. China's economy is $16 trillion which again is 5 times our size. Yes, India is no longer as insignificant as we were for a long time.

But I see the centre of gravity of economy moving to Asia with China, Japan and India powering the growth. The West Asia is shrinking with lesser and lesser price for oil but they are still creating jobs. West Asia contributes a major destination for job seekers but the problem is, there are people coming back also, especially in the semi-skilled and unskilled category.

$65 billion a year remittance comes from abroad to India and we are hardly creating a million to million and half jobs in the organised sector. That is why we are now helping Ajeevika, the central government's overseas placement bureau. We want to identify a million overseas jobs every year.

Where do you see the million jobs?

Other than West Asia and South East Asia, we can tap South American countries where there is an equally great need. That is why Modiji is trying to open up the South American corridor.

I clearly see half a million more overseas jobs for Indians. It is not brain drain but meaningful deployment of our brains.

Photograph: Sreeram Selvaraj

Note: The top photograph is used only for representational purpose

Bottom left: K Pandia Rajan, Chairman and Managing Director of Ma Foi Strategic Consultants Pvt Ltd