An amazing story from rs 60000 to rs 435 crore!!Document Transcript
Vinodrai Engineers Pvt. Ltd., 12 Km. Stone, Jalna-Aurangabad Road, Village Dawalwadi, District : Jalna Jalna – 431 203 ( India ) Ph: +91-2482-221061 Fax: +91-2482-221448 Web: vinodrai.com , E-Mail : email@example.comAn amazing story: From Rs 60,000 to Rs 435 crore!April 16, 2008 Today Ma Foi Management Consultants is the largest HR services provider and staffing company in India, with a turnover of Rs 435 crore (Rs 4.35 billion). Ma Foi has so far helped generate career opportunities for more than 169,000 people in 35 countries.K Pandia Rajan started it in 1992 with a capital of just Rs 60,000. Ably assisting him inhis long journey has been his wife, Hemalatha Rajan, who is also the director of thecompany. Childhood in Sivakasi Pandia Rajan was born in Vilampatti village in Sivakasi district. His father who was a worker at a match factory died when Pandia Rajan was just three months old. He was brought up by his grandparents in a joint family of about 40 to 50 people. Later his grandparentsstarted their own match factory.After studying in the village school, the hard-working boy went to Coimbatore to studyengineering at the PSG College of Technology.Pursuing excellence in rotational moulding.
Vinodrai Engineers Pvt. Ltd., 12 Km. Stone, Jalna-Aurangabad Road, Village Dawalwadi, District : Jalna Jalna – 431 203 ( India ) Ph: +91-2482-221061 Fax: +91-2482-221448 Web: vinodrai.com , E-Mail : firstname.lastname@example.orgHaving stood first in the university, he joined XLRI, Jamshedpur for his MBA. That, hesays, was where the seeds of entrepreneurship in the HR arena were sown in his mind."At that time, HR guys never became entrepreneurs, but I wanted to study HR and thenbe an entrepreneur. In my village too almost everybody is an entrepreneur. Unless youare on your own, you are a nobody there. So, you can say the entrepreneurial spirit isdeeply ingrained in all of us."But he had to wait for some time. After working for six years, and getting married to achartered accountant (Hemalatha) in 1989, he and his wife decided to put all their dreamstogether in their own enterprise."Starting Ma Foi On August 15, 1992, the couple decided to launch Ma Foi Management Consultants ?to market expertise as a product. But why a French name? "We were targetting the international market. So, Ma Foi -- or My Word -- is a name that meant something to all European countries. It gave us an occasion to speak about our value Image: Students at a laboratory in a school run by a to the clients. ?Ma Foi trust set up by Ma Foi Consultants. symbolized what wewanted to say and do."With an investment of Rs 60,000, they started Ma Foi in "a small shack of a place." Butby the end of the year, four of their friends put in Rs 10,000 each and upped theinvestment to Rs 1 lakh (Rs 100,000).They started primarily by placing engineers overseas. The Chennai office, which openedat 6 a.m., remained open till midnight so that candidates could walk in and register anytime. "Although it was a struggle initially, we wanted to position ourselves as acandidate-centric organisation. About 30 to 40 people visited us every day. It was 1992-Pursuing excellence in rotational moulding.
Vinodrai Engineers Pvt. Ltd., 12 Km. Stone, Jalna-Aurangabad Road, Village Dawalwadi, District : Jalna Jalna – 431 203 ( India ) Ph: +91-2482-221061 Fax: +91-2482-221448 Web: vinodrai.com , E-Mail : email@example.com and the Gulf region was booming. We sent dozens of middle-level and managerialpeople at that time to countries like Oman, Saudi Arabia, Kuwait, Malaysia, Brunei, etc. .."Even as visa processing began, the Babri Masjid was felled. All Gulf nations put a ban onissuing visas to Indians. And Ma Fois losses ran into lakh (hundreds of thousands). "Itwas a tough phase and we had to pledge even our jewellery. But when we came out of thestruggle, we expanded into all kinds of things."By 1994, a lot of multinational companies made their entry into India. By the end of1994, Ma Foi got a huge offer from Apple Computers to recruit all their heads ofdepartments. "That was also the time the salaries in the Gulf region started falling. Tillthen we had not done any such huge recruitment in India. Whatever we had done wasonly on the secretarial side. With that one assignment from Apple Computers, we movedahead in India."Ma Foi also set up offices in all the big cities in India and seriously started looking atdomestic recruitment and sectors like IT, finance and banking.By then, Ma Foi became a closely held public limited company. "We gave equities to ourfriends, relatives with the promise that we would return at least 20% dividend everyyear."During the dot-com boom in 2000, Ma Foi also had a dot-com plan and got a lot ofventure capitalists investing in it. But then came the dot-com bust. "Thankfully we wereaffected only slightly by the dot-com bust. We pulled back the dot-com model very soonand convinced our VCs to use what we got -- around Rs 8.5 crore (Rs 85 million) -- in thebrick-and-mortar model. With that money, we could spruce up our offices and add morepeople."Part of the Vedior Group In 2002, Ma Foi set up their first overseas office in Dubai. "In terms of turnover, we were number one in India then, with 600 people working for us. Whenever we travelled abroad we noticed that the staffing industry over there was quite evolved. It also Ma Foi has been giving back to the society through made business sense to its corporate social responsibility intiatives.Pursuing excellence in rotational moulding.
Vinodrai Engineers Pvt. Ltd., 12 Km. Stone, Jalna-Aurangabad Road, Village Dawalwadi, District : Jalna Jalna – 431 203 ( India ) Ph: +91-2482-221061 Fax: +91-2482-221448 Web: vinodrai.com , E-Mail : firstname.lastname@example.org offices abroad. Deputing 10 people in the United Kingdom is equivalent to deputing100 people in India!"After understanding how the overseas market worked, they had two choices: either to gofor an initial public offering, or to look for a global, strategic partnership. "The IPOmarket was down and volatile then. So, we decided to go for a strategic partnership withglobal majors. Giants like Manpower, Adecor and Vedior were also looking at the Indianmarket.""Vedior (the worlds leading specialist staffing company from the Netherlands) was muchbelow the two in terms of turnover, but it allowed us much more flexibility. It was amulti-brand company and called itself a federation and corporation. Because it is afederation, a lot of entrepreneurs become a part of it. We run the show and they supportus. We had 270 shareholders, plus the VCs, then. It was a majority partnership with 76per cent held by Vedior and 24 per cent by us. Today, we hold 18 per cent.With Vediors support, Ma Foi set up offices in the United Arab Emirates, the UK,Singapore, Sri Lanka, Oman, the United States, Bahrain, Kuwait, Qatar, Thailand, HongKong, China, and Malaysia.The Indian market and the world market"India is still an evolving market; it is still not a mature market though a lot more clarityhas emerged in the last five years. In terms of legality, it is clearer too. On the other hand,the European and the US markets are quite mature. It will take another decade or so forthe Indian market to evolve fully.""People are slowly getting comfortable with temporary staffing in India too. In a countrylike France, almost 80 per cent of the staffing is on temporary basis. People mostly workon contract. But in India, there is a stigma attached to temporary jobs."Impact of the US recession"Definitely the slowing down of the US economy will have an impact on the Indianeconomy too, but not too much. It may take another six months for the IT and BPO sectorto feel the pinch. Sometimes, the impact could be positive; there may be moreoutsourcing too as they have a problem there."Making profitsMa Foi broke even in their first year itself. From placing 30 to 35 people in the first year,now they find jobs for around 5,500 people every month.Pursuing excellence in rotational moulding.
Vinodrai Engineers Pvt. Ltd., 12 Km. Stone, Jalna-Aurangabad Road, Village Dawalwadi, District : Jalna Jalna – 431 203 ( India ) Ph: +91-2482-221061 Fax: +91-2482-221448 Web: vinodrai.com , E-Mail : email@example.comIf the turnover of the first year was Rs 520,000, today, it is Rs 435 crore. In the initialyears, Ma Foi grew at more than 100 per cent. The companys compounded annualgrowth rate has been 70 per cent.Social responsibility "Though both of us were fairly well employed, our dream was to build an institution, do something meaningful and give something back to society in whatever way we could," the Rajans say. The company made a profit of Rs 5,000 in the In 1997, they started a Trust called Sornammal first year. Vandana Educational Trust (SET) in the name of Pandia Rajans Gopikumar and grandmother. The first effort was to help the students Vaishnavi Jayakumar, of his village. two college students had just started Banyan,a Trust that helps rehabilitate mentally challenged destitute women at that time. "We sentthe entire money to help them set up Banyan. From that year onwards, we keep aside apart of our profits for charity."As they doubled their profits every year, their contribution to charity too increased. In1997, they started a Trust called Sornammal Educational Trust (SET) in the name ofPandia Rajans grandmother. The first effort was to help the students of his village.In 2000, when a school with 100 very poor children run by Hemalathas grandmother wasto be closed down after she passed away, the educational trust decided to run it. "Whenwe saw the poor children, we felt like helping them. We bought a piece of land and builta school. We called it Sornammal Matriculation School. Now we have 650 children, ofwhom 350 study free of charge."It was when Hemalatha met the mothers of the poor children that the idea to start self-help groups (SHGs) originated. These women are clustered into groups and are givenvocational training so that they could start their own ventures. Training is provided toPursuing excellence in rotational moulding.
Vinodrai Engineers Pvt. Ltd., 12 Km. Stone, Jalna-Aurangabad Road, Village Dawalwadi, District : Jalna Jalna – 431 203 ( India ) Ph: +91-2482-221061 Fax: +91-2482-221448 Web: vinodrai.com , E-Mail : firstname.lastname@example.org to become nurses, DTP operators, housekeepers and even auto drivers. They arealso taught tailoring, bag making, handicrafts, embroidery, et cetera. "Till today, we have given Rs 3 crore (Rs 30 million) as loans to these women to start their own businesses. I must say the repayment of loans has been 100 per cent," a satisfied Hemalatha said. The trust has 816 SHGs for 13,128 women in Chennai. CIOSA In 2004, after working with many NGOs, Hemalatha felt the need tobring all the NGOs under one umbrella, and that was how the Confederation of IndianOrganisations for Service and Advocacy (CIOSA) was born. It acts as a good platformfor corporates and NGOs to work together.In 2007, the Ma Foi Foundation was formed so that all the corporate social responsibilityactivities are taken care of by one body. Under the Disha Scholarship Scheme, 1,300children from corporation school -- 150 are from the Rajans native town Sivakasi -- getscholarship to study. The foundation also runs career guidance programmes for the 8th,9th and 10th standard students."Ma Foi Foundation promises a better society as we believe in giving back what we takeout and changing the world for the better," the Rajans said.Pursuing excellence in rotational moulding.