Chapter – 16

Some Entrepreneurial Success Stories

Ten cases have been written to probe into the environmental factors related to initiation as an entrepreneur. Names have been disguises to protect their identity. The cases and the conclusions are given below:

The Case of Market Research Expert Setting up His Own Firm

Salvi, born in Delhi, on 26 November 1940, did his B.Sc. (Hons) from St. Stephen’s College, Delhi and then proceeded to do his M.A. at Cambridge University, which he did in 1963. A famous market research firm in U.K. commissioned Salvi to set-up a company in India in 1972.On being asked about how he became an entrepreneur Salvi replied that “after three years I felt that if I could set-up a company for others and make them successful, why not I set-up a company myself. Moreover, I had got an insight into what was involved in setting up a new enterprise which gave me the confidence for starting my own business.” He further added, “I had family problems which are also partly responsible for my becoming an entrepreneur. I had a handicapped child and I had to move from Jamshedpur to U.K. for the treatment of the child. During this period my first marriage broke up. I married a second time and managing two families required extra money. I had a Company flat, Company car, etc. However, I could not divide this into two parts, so I decided that the only solution was to set-up my own company, as I wanted to send my son to Cambridge. I felt that I must give at least the same beginning to my son which my father gave to me, if not a better one.”

About the locational advantages, Salvi said, “In Bombay so many people are doing business. If I had been in another city in India or even London, I perhaps may not have taken up entrepreneurship.”The salient environmental factors here is a second marriage, which provided a difficult challenge moving Salvi towards entrepreneurship. His determination to give a foreign education to his son which he could not have done on a salaried job, the commercial environment of Bombay which facilitated Salvi’s movement towards entrepreneuship and the working experience gave him an insight into the setting up a company.

Confidence was the only personal characteristic, which was reflected in the case. This proves that more than the personal characteristics, the environment has been important in moving Salvi towards entrepreneurship.

The Case of Pran

This is the profile of an entrepreneur who has had no formal education whatsoever, but has today become the owner of a business of die making.

Mr Pran hails from a small village in Ratnagiri district from a family of Hindu priests. In his childhood, he had dreams of becoming an engineer. His father was, however, not interested in giving him any formal education, except the traditional education designed to equip him to become a priest. His mother, however always felt that he should become a “big man”.

After the death of his father when he was 19, he stayed in his village for a few years and married off his two younger sisters. Thereafter at the age of about 25, he stepped out to seek his own fortune in the city of Bombay.He landed in the famous George Motors Auto Repairing Workshop at Tardeo where he acquired the skills for repairing motor vehicles. Since he was working in a very large and well-equipped garage, his perception was that setting up a good garage would be much beyond his reach. Subsequently he started working in a workshop that was making some electrical components. During this period, he started working after workshop hours late in the evenings under an expert die-maker. He told the die-maker that he would not expect him to pay him anything, but the relationship would be that of a Guru and Disciple, and the die-maker agreed to impart all his knowledge and skills to this worthy student.After acquiring the skills of die making, he started getting a few jobs on his own and a few through his friends and other connections. During this time, a nearby workshop owner-a Gujarati businessman, was kind enough to permit him to use his own workshop after 5 o’clock in the evening and before 9 o’clock in the morning.

After a few days of working like this, while he was looking at a lathe kept in the display window of a small shop, he was accosted by the owner of the shop and asked what it was that fascinated him so much. In the subsequent conversation he was able to strike a deal with the shop owner for the purchase of the lathe costing Rs. 2,900 on down payment of Rs. 1,400 on the understanding that the balance amount would be paid in installment within a year.Starting his workshop in small 5’X7’ space, the business has steadily grown today and our entrepreneur owns a good workshop in Mahim Industrial Estate where he has earned a name as an excellent die-maker. His total turnover is Rs. 1,40,000 per year. He owns a car and also has got his own residential accommodation.

Asked to elaborate reasons for his success, he attributed his success to his hard work and a penchant for excellence in workmanship. He also pointed out that over the years he had acquired a good working knowledge of English that enables him to read and understand the necessary technical books on his subjects. He was also able to deal with all administrative matters relating to sales tax, income tax, factory regulations, etc., for his workshop. He acquired working knowledge of accounting and prepares a quarterly balance sheet himself that gives him a correct idea about the direction in which his

business is going. By analyzing the factors, which help his profits, he is able to avoid financial problems.

The environmental factors that could be isolated are his meeting an expert die-maker who gave him training in die-making and their ‘Guru-Disciple’ relationship. His father’s death when he was nineteen gave him the freedom to forsake his ancestral profession of Priesthood.

In this case the personal characteristics seem to be quite strong.;

Pran had a very high achievement motivation. He did not want to take up the family profession and wanted to do something very big which landed him in Bombay.

He also possessed excellent workmanship.Thus, the personal characteristics seem to be more dominant than the environmental factors in his case.

The Case of R.V. Lele, the Xerox Giant

R.V. Lele was born in Bombay on 13 July 1938 in a relatively large family having six brothers. He was the third son. Compared to other brothers he was well qualified having done his M.Sc. in Civil Engineering (Town Planning) from University of Poona, in the year 1972.

On being asked about the reason for his moving towards entrepreneurship, Lele said “My mother and her 7 sons including me, were doing cloth and saree business as a means of survival as the only working member in the family (my father) was sick for about 10 years.”

Lele started working on a salary of Rs. 175 p.m. as a Design Assistant. This salary was not sufficient to meet the needs of the family. “At that stage I decided that I must start something on my own. I had a loft measuring 5’X10’ where I started working on my first ammonia printing machine, which was designed and fabricated by me. Dadar was commercial place and the locality had many educational institutions. I thought the place was suitable for document copying business.”

Lele further added, “My brothers were not very happy with my taking up business. They wanted that I should take up some job. They insulted my ability, leadership and as a sharp reaction to them I decided that I would remain an entrepreneur. My wife who was working provided moral support to me and today I have built up my business. The turnover used to be Rs. 24,000 in 1964 went up to 24 lakhs during the last year. After 1974, I opened a new branch every year.”

On further query regarding any other factors that moved him towards entrepreneurship, Lele said “I had a very genuine friend who deposited Rs. 500 with me in 1968. He kept on increasing his investment in my business and now his total investmemts are Rs. 50,000. This was all his hard earned savings on which I pay him 18 per cent interest per annum.”

Lele today is a household name in Dadar area in the copying business with a large number of branches. The environmental factors that could be isolated are a very difficult pecuniary condition because of the sickness of his father and family being large, the hostile attitude of brothers and an educated working wife who provided support.Here also the environmental factors are much stronger for movement of Lele towards entrepreneurship, where he has achieved considerable success.

The Case of Mr Shamim

This 49 years old chemistry graduate comes from a lower middle class family from a village in Kaira District, Gujarat. The only child of his parents, he thought of setting up a business in consultation with some of his school friends who are also well educated. While one of them is the son of former Chief Justice of Saurashtra, another is a Chartered Accountant and the 3rd one is a postgraduate in Chemistry.

After his graduation, the thought of taking up a job at a paltry sum of Rs. 150 p.m. never occurred to him. He therefore entered the business of paper/stationary trading. The strong currents were, however, pushing him towards some manufacturing activity.

Married at the age of 20, he did not receive any help form either his parents or in-laws beyond a few thousands of rupees. Initial investment was financed from a bank loan of about Rs. 90,000 and equal capital contribution of Rs. 10,000 each by the partners. While the turnover steadily increased from Rs. 4 lakhs to 35 lakhs, the assets have also increased from Rs. 2 lakh to Rs. 25 lakhs. The firm tried unsuccessfully to manufacture monofilament yarn for nylon cord in 1968-69, but closed the particular business after heavy losses in 1971. He is currently in chemicals business.

The entrepreneur appeared to be eager to elaborate on his success and willing to help any young entrepreneur who may be in a situation similar to his situation, as prevailing about 20 years back.The environmental determinants in this case are as follows:

His close friends who were all well-educated and with whom he started a partnership

His education where the subject of chemistry made him interested in manufacturing activity

The help from a bank from where he could take a loan of Rs. 90,000.

There were no important personal characteristics evident in this case history and most of the credit for his movement towards entrepreneurship can be given to the environmental factors as mentioned above.

The Case of Mr Manish

This young 36-year-old entrepreneur is the Managing Director of a private limited company manufacturing foam rubber. His boyish chubby face gives the appearance of a happy contented person.

He is the 4th child of his parents and having six brothers and five sisters, he has studied up to F.Y. Commerce. Except one younger brother and one sister, the others have studied up to matriculation only and in fact 3 sisters and one brother are non-matric.

He was brought up in the posh Napean Sea Road locality of Bombay where his father, a pioneer in the art silk industry was staying, right from the childhood of the young entrepreneur.After starting a textile mill of his own, he was attracted towards the foam rubber business based on the information given him by one of his friends who is in the export/import business of leather garments.

Though the idea of setting up an industry occurred to him in 1968, the factory was set up only in 1972. This was at the time when industrial licenses were not being issued for the foam rubber industry. After repeated efforts by making applications to the government, the unit was set up in the face of stiff competition posed by U-foam Rubber Company, which was the biggest unit in the industry.

Since it was a large family, it was quite clear to brothers that though the father was in-charge of a very prosperous business (annual income above Rs.1 lakh) all of them could not work in one unit. Finance was apparently not a problem since an initial capital of Rs. 20 lacs, including Rs. 5 lacs as share capital could be procured without difficulty. The brothers also had the willingness to take in their stride profits or losses up to a new lacs of rupee. Though they hail from a business community their grandfather was in service and only the father’s example seems to have inspired the children to go into business. While the office is located in Bombay, sales are being made all over India.

Here the most important factors were the business family background of Manish and the large family where everybody had to take up something new as all the six brothers and five sisters could not be accommodated in their father’s business.

In this case, the environmental factors are the most important ones in moving Manish towards entrepreneurship. Personal characteristics do not seem to have played an apparent role in his entrepreneurial development.

Case of a Dentist, Who Set-up a Production Unit

Dr. Sanjay is a qualified dentist who is about 60 years of age. After completing his degree, L.D.C.E. in 1945, he set-up his practice in dentistry along with his wife, who is also a qualified dentist. During this period he was company doctor for a few reputed shipping companies. He came in contact with some foreign shipping crews. He found that they were using dentures made by a special process. This generated in him a desire to acquire technology, for this, he visited New York. Chicago etc. in 1950-51 and actually worked with the dentists. Thereafter he returned to India and set-up his own workshop for making dentures with the help of this new technology. For a long period, he was the only person employing this technology. Another competitor has set-up a factory in Santacruz in Bombay.

The business has steadily grown from Rs. 30,000 in the first year to Rs. 4 lacs during the last year. The assets have also gradually grows from Rs. 25,000 to Rs. 4 lacs.Dr. Sanjay has a special interest in creative activity and would even now like to watch a carpenter working to understand his skills and techniques. Though not an engineer himself, he has set-up a factory that employs about 20 people. His only regret is that after setting up the factory he has been kept so busy that he hardly had any social life.

In the course of the business, he meets dentists, their peons and other carriers who come to collect the ready dentures. He felt that if he had continued as a dentist perhaps his social circle wound have been much wider and he would have had many more friends than what he has today. Monetarily he feels that he has not gained anything more significant than what he would have earned had he continued as a dentist. In any case money has not been a major motivating factor in setting up the factory, but the main consideration was to learn a new technology and employ it effectively.

The environmental factors that seem to have facilitated movement towards entrepreneurship in this case are a qualified wife who gave the necessary support for the entrepreneurship and his contact with a particular technology where dentures were made by a special process.There are two personal characteristics that are important in this particular entrepreneur-his high involvement resulting in the sacrifice of his social life and his desire to do something innovative and his interest in creative activity.In this case there is a balance between the environmental factors and personal characteristics in moving Dr. Sanjay towards entrepreneurship.

The Case of Mr Prasad

Mr. Prasad completed his Inter-Science in the year 1959. He had the ambition of joining an engineering college and becoming an engineer. He, however, did not secure adequate marks in his final examination. The result was that many of his friends joined engineering colleges, but he could not. Then he started going to automobile-parts shop that was owned by his friends who had come back after completing their engineering degree. He discussed with one of his close friends who had completed the engineering degree. They decided to would manufacture water pumps and water-pump repair kits. He purchased a shed in an industrial estate. However, his friend’s father prevailed upon his son that this partnership should not be run on 50-50 basis, as he was an engineering graduate and Mr Prasad was not an engineering graduate. Mr Prasad feeling humiliated decided that he would start the business on his own. His friend also felt bad about the whole incident and proceeded to USA for higher studies, in engineering. Mr Prasad started a small engineering business he ran for three years. However, the experience was not very happy. He then switched over to rubber chemicals.

He got Rs. 2 lacs from his father, being his share in the property from Hindu Undivided Family for starting the business. However, to reduce the risk his father distributed Rs. 2 lacs into 8 parts and made other brothers also a part of his business. He did well in business and now he is on his own. He has never borrowed any money from his father after the initial capital.

The most important environmental factor which affected Prasad was the refusal of his friend’s father to allow his son to start a partnership on a 50-50 basis as Prasad was not an Engineering graduate and Prasad’s humiliation over this incident provided the necessary motivating power for his movement towards entrepreneurship.

Another factor was the financial support provided by his father in the form of Rs. 2 lacs as initial capital.

Thus, in the case of Prasad, environmental factors were the most important ones for his becoming an entrepreneur.

The Case of a Retired Executive Taking the Role of an Entrepreneur

This is an unusual case of an entrepreneur who had set-up his business after retiring from service at the age of 60. Balan, born in Karachi, had been brought up in Bombay. After initial failures in business, he started serving in LIC where he worked for 14 years. He had suffered a heart ailment about 15-20 years previously. He was asked to slow down his activities by his doctors. However, undaunted by this situation, he believes that as long as he can work, he should do something constructive. During the interview, he expressed his firm determination to carry on business even if it meant initial losses.The business consists of trading activity in leather goods and also a transport agency of Transport Corporation of India. He expects to have a total turnover of about Rs. 8 lacs on transport agency and Rs. 3 lacs on leather goods.

His main help has come from a friend whose business premises were available in an Industrial Estate. This friend is also a partner in the business. On the family side, his son is in business of rubber chemicals and is doing very well. The old entrepreneur has not taken any help from his son to set-up his business. He started with his own money and expects to raise substantial working capital through various courses.

Two important environmental factors areimportant in the case of Balan. These are:

Help of a friend whose business premises were made available in an Industrial Estate and who subsequently became a business partner. The fact that his son was already in rubber chemical business may have induced a feeling of security in the old entrepreneur.

However, the most important characteristics of this entrepreneur was his Never say die attitude. He has done business earlier, but left it as the business failed. He then worked for 14 years and ultimately started his business again.

Thus the personal characteristics which may be termed as achievement motivation is of a very high order. These personal characteristics have been supported by the environmental factors in his movement towards entrepreneurship.

The Case of a Non-Engineer Starting an Engineering Business

Panda is a 46-year-old partner in an Electronics firm. A matriculate himself, he started an engineering stores selling product to big organizations. His first partner was another non-technical person who brought in the capital required for the business. Initially they took up the line of automotive spares and electricity items. Soon, however, they found that there were a number of malpractices in the business of automotive spares and decided to concentrate only on electrical goods. A famous multi-national electronic business gave them ample support by way of guidance and developed them as an ancillary industry. Today the firm manufactures several electrical/electronics items, control accessories, material handling equipment, etc. The diversification has mainly come from electrical to electronics items of a similar nature.

When asked whether he considers himself a successful businessman, he stated that “whether the business has been a success or not, can be decided only on the last day of one’s life.” The two other partners are both engineers and joined only recently after the business was well established.

There is no doubt about the success of the business. With a modest beginning of Rs. 10,000 in 1964 in terms of turnover, it has today grown up to Rs. 30 lacs per year. It occupies 4/5 blocks in Mahim Industrial Estate and the total assets employed have been quite substantial though the figure given was Rs. 1,50,000. It is also interesting that this unit has spent substantial amount on Research & Development and one block is devoted to R & D work only.

A study of the above case indicates that the environmental factors that facilitated entrepreneurship were the capital from the partner and the help imparted by a multi-national.

On the personal characteristic side, it is felt that his statement “whether the business has been a success or not can be decided only on the last day of one’s life” indicates a very high achievement motivation on the part of Panda.In this case, there is a balance between the personal characteristics and the environmental factors in moving Panda towards entrepreneurship. Though, environmental factor seems to be slightly more important than the personal characteristics.

The Case of an Export Consultant

On being asked to narrate the factors, which moved him towards entrepreneurship, Dalal said, “My life when I was young was very miserable. My father expired when I was just a few months old. I had no brothers or sisters. My mother was my only source of support. As my mother had no one else, we were given shelter at my mother’s aunt’s house. My mother had to do the household work there to support both of us.”

He added, “I went through a lot of hardships during the time of my education. My mother worked hard to see that I got the best of education. I studied up to the 6th standard at my village. After that I came to Bombay to my uncle’s house. Here too, life had become very hard. Going through all these hardships and always depending on others for my needs, I thought it better to become independent rather than depend on others. From then, I always thought of becoming independent and this had an impact on my career and study too.

“It was during my school and college that I adopted a self-study method. It was because of the school where I studied. The teaching was not up to the standard is this school. The teachers never bothered about explaining the lessons. I felt that at this rate I would never be achieving anything in life. So I started this self-study method where I used to study everything on my own, I never depended on anyone for any guidance or help. This played a very big role in making me independent in my attitudes. Even in college I adopted the same method. After doing my engineering another problem came up, it was getting a job. I was unemployed, as I had no one to help in getting me a job. I had to do all kinds of odd jobs and finally I got a job of Rs. 300/month.“Later on after a year or so, I got a job at a well-known company at Poona on a salary of Rs. 450 as a Sales Engineer. But here my talents were not recognized.

“The above two jobs forced me to think deeply of becoming independent. But being based in Poona and on tour most of the time this was not possible. So I thought of shifting back to Bombay in search of some good opportunities. I then took up a job in a governmental establishment at Bombay as Design Project Engineer, on a salary of Rs. 710. Here, too, it was more of personality clash and politics.

“I now feel that the kind of independent study and self motivation with determination was thus the beginning of entrepreneurship. It was during this time that Export and Import was in great demand. I heard a lot about it and was also interested in this particular field and considered whether I would succeed if I took up this subject seriously. I started studying this particular subject independently and of course attended a few lectures on them and determined to become an entrepreneur within two years. I worked day and night on this subject and in April 1973, I designated myself as an Export Consultant with a small office, and within a few months resigned from my government job.

“My income increased with consultancy and training programmes. In 1975 I started Dalal Export-Import firm by starting the export of Dalal brand diesel engine and later on moved export of other lines.”

Dalal is the top most import-export consultant in Bombay today. He has authored a book, which is in great demand.The environmental factors identified here are as follows;

Very difficult family conditions with the demise of his father when he was only a few months old. But for his mother, there was nobody else in the family. His mother had to support both of them by her work.

The companies where he took up jobs did not give him satisfaction. One company was in the private sector where his talents were not fully utilized and the other was a government establishment where there was politicking and intrigue.

These negative environmental factors moved him from a salaried job to entrepreneurship.Two personality traits played a significant role in the entrepreneurial development of Dalal. His independent nature and his “self-study” habit.

Making a name in an area without any background only based on self-study is an achievement, which is indicative of the high achievement motivation of Dalal.

In this case there is balance between the environmental factors and the personal characteristics moving Dalal towards entrepreneurship.