Friday, December 17, 2010

S. Anil Kumar, MD, Fieldturf Tarkett - How To Build a Successful Startup

Meet S. Anil Kumar, CEO and promoter of Great Sports Infra, a pioneer who brought the concept of next-generation artificial grass and sports surfaces to India as recently as in 2004. As the exclusive franchisee for Fieldturf, the world's leading artificial turf manufacturer, Anil's small and compact team, based out of Hyderabad, has already installed an impressive 2300 installations in India and has opened up the market for artificial turf in sports and non sports (landscapes) in the country. Of the above there are about 100 sports installations, including 5 football fields, the Salt Lake stadium being the most impressive.
Anil Kumar, MD, Fieldturf Tarkett, India

I have known Anil for a long time. As a strapping young lad who stood at 6 feet 3 inches when he entered the Osmania University Engineering College, he had the unmistakable look of a sportsman, an athlete, and so he was. He was three years junior to us and we were in our final year, but we sportsmen bond fast and so it was that he, John, Sanjay and some others were known to us well. He always came across as a level headed, reserved, well mannered and polite young man, one of the few who dressed well and carried himself well, did his own thing and lived life on his terms. I remember him as a javelin thrower and then as a Captain of the University handball team as well, someone who participated in all the sports and cultural events and always left a mark. And fittingly, he married another junior of mine, and another accomplished sportsperson, Sujatha, who was a national level Handball player. Anil is also a childhood friend of my good friend Naresh Raghavan, both hailing from Padmarao Nagar.   

Post engineering Anil did his MBA from Symbiosis, Pune and worked with Wipro for a couple of years (1993-95). Then he joined Ramco Systems and worked with them till 2004 growing rapidly in the company and heading the ERP Business for North America when he quit. And then Anil did something interesting, which is what this interview is all about. He started a new company and relocated to India in 2004. I met him then, as I had also just quit my job and was embarking on a new career as a writer, so we both share certain things. As luck would have it, his initial marketing collateral was developed by Sheila, for whom I wrote copy. So Anil became one of our first clients (and mine for copy, I still have the first Fieldturf brochure filed away in my portfolio). Apart from his enormous patience and grace, the thing that impressed me most about Anil was his eye for detail and the thoroughness with which he did things, the amount of work he put in and the way he did it all with a smile. Always.

Today he has grown his company into a Rs. 14 crore company in the span of six years, pioneering a highly priced and unheard of concept in India, with his own resources and no real backup in terms of finance or marketing, which is no mean task at all and I wanted to ask him how he did it. How he made his startup successful when most fold up pretty soon.

Q) You are a first generation entrepreneur? How did it all start?
A) I was always keen on doing something on my own. Even in my tenth class I remember answering advertisements for franchisees for Arrow shirts and even MRF (for a retreading unit). I would get my application typed by a typist who sat near the Secunderabad Railway station, fastidiously underlining or highlighting certain parts of the letter in red, and end the letter with words to the effect that my father would put up Rs. 1 lakh for my venture. I never heard from Arrow or MRF but I was pretty clear even then. I took an elective on Entrepreneurship Development during my Engineering days at the Osmania University Engineering College to gain some insights into entrepreneurship and then did my MBA to gain the knowledge behind business management. I was pretty clear I would work for a while, study business as an employee, and then take the leap when I felt I was ready. So I put in a little over a decade of work and then took the leap.

Q) What did you learn on the job that made you feel confident that you could take the leap?
A) I was frontline sales in Wipro and learnt what it means to be that but in Ramco, a smaller company, I learnt much more. When I was in the US, I was responsible for setting up the distribution system. This involved lots of work and confidence building, for myself and the distributors who were investing time and money, since we were a relatively small, unknown player in the market. I had to instill a sense of comfort in the distributors which I carefully did by staying close to them, keeping all my commitments and gaining their confidence. I guess in the end it was that trust factor that saw me through than the hardware of agreements etc even though they were important as well.

Q) Was that a point in time when you realised that your quality of keeping commitments, however small, could be the way you did business? Did that belief get hardened then?
A) Not really. I think I was always like that. I never committed anything that I could not keep. I promise something to anyone, I go that extra mile to do that. All the people I know will vouch for that. Even in our business here of artificial turf, which has low or no repeat business, we do everything humanly possibly to deliver what we promised. It is my ethic, now our entire team works this way.

Q) When did you know you were ready for business?
A) After 11 years in Business Development and Business Management in USA and India, I decided to take the plunge. We decided to come back to India. I gave myself two years to succeed at the business.

Q) How did you go about identifying what to do?
A) I analysed the market and looked for a new product. A new product would give me the comfort and cushion of not running into stiff competition, a competitive field. Then I researched about 400 companies which had won export awards. That was evidence to me that they had products that were good enough for foregn markets, and all I was evaluating further was which of those were suitable for India. It did not matter which industry then, because I knew that the mechanics and elements of running a business were the same. I zeroed down to about 8 companies of which about 3 companies showed some interest.
Anil at a play area with the Fieldturf artificial grass in the background

Q) How did you end up with Fieldturf?
A) When I called Fieldturf, their CEO picked up the phone. He has a policy, just as I have here, to take all enquiry calls to stay in touch with the market. Of course, he discouraged me by saying that I had no experience etc and finally asked me to see someone who wanted me to come back with a business plan. It looked like a classic brush off but when I came back with my business plan, working late into night after my day job for many months (as I had no clue of the turf industry),  they could not brush me off anymore. It was pretty comprehensive. So they called me for a meeting in Montreal.
A day before the meeting I ruptured my Achilles tendon while playing basketball and I was taken to the hospital. The doctor advised a week's bed rest. I told him that I had to go for the meeting, took a pair of crutches and landed up in Montreal the same night for next day’s meeting in crutches. I had to hobble around for print outs and making the plan and even drive on that one functional foot before I made it to the meeting. At the meeting it so transpired that they wanted someone with construction experience. I said that India was the only country in which they had no presence. If they gave me a one year franchise, whatever they got from me was a bonus.

Q) How did the meeting go? What were the things you insisted on?
A) Of course everything was still on paper. I said I would raise USD 100, 000 from my side and showed them that I had the expertise of Olympians, Architects, Professionals on my Advisory Board. They told me that they would give me a non exclusive franchise which meant that someone else could also come in and operate in India. I put my foot down and said that my plan was not to be a passive representative, but actually spend significantly to develop the market and for that I needed an exclusive franchise or the deal was off.

Q) Did you foresee those issues before you went for the meeting? Because they are critical to your growth here. How important was your planning and preparation?
A) Yes, I was fully prepared. I had very little information, only about 10% information but I covered all angles, as many as I could with that. I tried to get the selling prices, in India, and get a hang of input costs for the projections. I called a market research company in India but they said they had no reference to such products before so that was a dead end too. I knew that selling sports installations in India was not easy - I had seen the sports bodies function when I was an athlete and knew it might not have changed much. So it was essential that I needed non sports installations. The business plan was exhaustive to the extent of information I had.

Q) How close are you to the original business plan now? What is the deviation?
A)  In terms of numbers, we are 70% on track. In terms of conceptual approach as to things we wanted to do and our approach, we are 90% there. Our first 1000 installations took 50 months, the next 1000 only 22.

Q) Going back to when you signed the agreement, how did you raise the capital and how did you plan the move from the US to India?
A) I had already resigned before I signed with Fieldturf. I had already sold the house as well so my decision was made. I raised Rs. 50 lakhs of which I put in Rs. 25 lakhs and friends and family shelled out $ 5,000 to $10,000 each - entirely based on trust. I had two exit criteria when I started - two years to succeed, or, burning up the capital of Rs. 50 lakhs - whichever came first. I mean if my burn rate was such that I could not do anything with Rs. 50 lakhs in two years I better get back and work in the IT sector where I had a decent reputation. But in the first year of operations, partial year of six months, we closed at sales of Rs. 30 lakhs. So the decision was made. We were here for good. We have now set up a large distribution system, 18 distributors, covering 22 states.

Q) Any moments where you had belief issues? Of giving up?
A) Not to the extent of taking a call on shutting the business but there was a time when the business was 3-4 years in, when I felt like I was running into a wall. Landscapes and non sports would keep us going but the big bucks are in stadiums. And in India football and hockey are not priority anyway nor do they appear to have funds. The sheer effort of pushing it forward for 365 days a year, for returns that did not seem like coming, distressed me for a while.
Q) What is the future then?
A) In 5 years on turf alone, our market should be Rs. 30-40 crore and other product lines should do Rs. 20-25 crore. I am adding products by the side, sports infrastructure products and building material products and that should help propel the figures.

Q) And your role?
A) My role gets limited as systems fall in place. Already in landscaping my involvement is only 10%, in turf it is about 50-60% where stadiums are concerned only, and in new products, it is 90%. But we have remained true to certain ethics we carried into business. We honour commitments, we do not go for untested material which is cheap, we are conscious of the quality we do, we stick to time lines despite holidays etc. Sometimes we see our work ethic rubbing off on our distributors etc which is nice.

Q) What is your big learning from this experience? From making this start up a success?
A) That I can do something that is 10 times this size easily. Now my respect for smaller companies has grown ten fold as well as they have to cope with marketing and advertising costs which appear huge in their scale. In a big scale these costs would almost be negligible. It used to bother me in the early days to spend on various marketing expenses that were really needed but we could not afford them.

Now I realise that it is the same process whether it is a small scale or big scale business. I have understood the process and now whatever the size I know I can handle it - raise resources by approaching a Venture Capitalist, get an angel investor or go to a bank. Size does not bother me. In fact it makes sense for me now to go bigger in scale if the idea is worth backing. That is what the experience has taught me.

Q) What would be your advise to new entrepreneurs or would be entrepreneurs?
A) I have about 4-5 things to say:
1) Don't jump into business without experience. Even if you have an idea, it is better to get some work experience, unless it is a time sensitive idea. It is important to get some insights of how business works. I would advise all MBAs and prospective first generation entrepreneurs to join a company, the smaller the better. Because the smaller it is, the wider is your perspective of how business functions. And 90% of it is the same - big or small business - it is getting the entire perspective that is important. On marketing, production, finance, legal, human resources.
2) Plan thoroughly. Don't go with romanticised business plans. Halve your sales and double your costs in your projections and see if it sustains even then. Be prepared for the worst scenarios because that gives you the strength to stay in tough times.
3) Be around even if things are not happening. At least 2 years. Don't quit early and give up if things are not looking good initially. Most people seem to wind up if things don't happen for six months or a year. It is important to stay there long enough that you give the business or the new concept a chance to slowly pick up.
4) Don't keep doubting yourself, your decision. Now that you have taken the plunge stick it our for that two years and give it your best shot.
5) If there are more than one partner, see that there are complementary skills. Running a business is a different cup of tea from being good with some technical skill. If there are more than one, get one guy to finally take the call and move the decision making along.

It is his attention to detail that makes Anil successful at whatever he does. Coupled with the clarity of his vision, it becomes a huge asset. His planning and preparation is exemplary as the business plan story to Fieldturf indicates. To me that's 90% of the job done. His work ethic is another one for youngsters to learn from - he works long hours, never gets tired, sticks to his primary beliefs and goes by his principles. His demeanour is that of always being in control of the situation. As a leader I know that he makes decisions quickly and wisely, again a product of his preparation, and inspires and eggs his team beyond their limits. And his combativeness and never-say die spirit is evident in the way he went to the meeting on crutches and in the way he stood on his feet in a time when no one knew what this artificial turf was. Surely the sportsman in him contributes to that aspect of never backing off from a challenge. And always with a smile, a smile that you can hear even across the line when he picks the phone.

It is no wonder that Anil does whatever he does well, and will continue to do so, at whatever he chooses to. And for those who wish to follow the path of a setting up a start up, a business venture or even at being successful at whatever they want to do in life, his methods and principles are worth emulating. I know there is along road ahead of you Anil, and that you will achieve much as well, and in the manner you wish. Here's wishing you far greater successes as you go along. Though we know that the result is a given anyway, we will be cheering you on every bit of the journey for sure!


Unknown said...

Great Job Anil...and excellent capture Hari...Those Osmania days are truly nostalgic and also the foundations for some solid friendships...enjoy..Sanjay

Harimohan said...

Thanks Sanjay. So true.