To be your own master you do not necessarily have to look outside your present set-up. An opportunity might lie in your current organisation itself. All it takes is to sniff it out and grab it. As Ravi R. Pai and Nachiket Urdhwareshe did.
They were colleagues at Bangalore-based Silicon Automation Systems (later renamed as Sasken). While Pai was heading the electronics design automation (EDA) division, Urdhwareshe was a senior engineering manager in the Japanese division. When the company decided to get out of EDA in 1999 for strategic reasons, Pai and Urdhwareshe saw a readymade business opportunity.
EDA is a branch of computer aided design that deals with tools for designing and producing printed circuit boards for the semiconductor and electronics industry. “EDA is the bread and butter of the semiconductor industry. Sasken wanted to refocus itself as a telecom services company. We stepped in when they decided to move out,” says Urdhwareshe.
In December 2000 they launched Softjin Technologies with 15 employees, all drawn from Sasken’s EDA division.
Instructively, they didn’t quit their jobs in a huff, but ensured that the transition was smooth. “We didn’t burn our bridges. Our association with Sasken was spread over a decade. We had to think of our commitments to Sasken and its clients,” says Urdhwareshe. While he stayed for nine months after notifying the company of his decision to move on, Pai stayed back for a year to honour existing contracts.
Their passion for technology was also a reason for the duo to grab the chance of starting a business of their own.
The initial investment of Rs 85 lakh was not hard to come by. They had their stock options from Sasken to count on. Their efforts to maintain good relations with their previous employer bore fruit when key members of Sasken invested in Softjin in their personal capacities. Thus the starting capital was arranged largely from angel investors, friends and relatives. To meet the working expenses of the company they took loans.
Risks were higher on the personal front though. Their spouses were homemakers and there were no alternative sources of income. However, Pai was confident of success. “With our high educational background in specialised technologies we were confident of getting a job if we faltered,” says Pai.
Urdhwareshe and Pai leveraged their contacts formed over the years. Softjin’s first customers were earlier clients at Sasken who supported the Softjin team and continued doing business with them.
But it wasn’t smooth sailing always. In 2001, the tech bubble burst and their business, like so many others, was hit. It affected the value of their Sasken stocks, a chunk of which was used as initial investment. With a question mark looming over its projected earnings, Softjin could not afford to take in more employees. It had campus recruitment offers at Indian Institutes of Technology to be honoured.
While the company did not have problems with cash flows, it could not afford to pay these extra recruits. It was then that the employees reined in the situation, offering to take pay cuts to ensure the offers were honoured. That proves how critically important it is to have employees who believe in the future of the company and are ready to rough out the tough times.
However business as fundamental as semiconductors did not get majorly impacted by the tech meltdown. And theirs was a niche business which had a growing demand in the semiconductor fabrication industry. Over the years Pai and Urdhwareshe have added only 70 more employees to their team.
The company today works on a unique hybrid model offering both services and software products. Initially, services was the area of emphasis, but now they are concentrating on products to generate revenues. It reflects in the topline, since products contributed 30% to their revenues last year. “Nirmaan” is their flagship product. Meant for semiconductor firms, this software solution increases efficiency in laying out circuit designs.
Softjin currently has nine clients spread across Japan, North America and Taiwan. However, as the semiconductor majors zero in on India as a manufacturing and fabrication hub, the entrepreneurial duo hopes the action will hot up further.
Growing at 50% annually in revenues, the company is looking at a turnover of Rs 15 crore this financial year. Self-effacing in nature, Pai and Urdhwareshe attribute their success to the faith their clients and employees have in them.
As dual heads running an organisation did they ever have ego clashes? “We are too focused on providing the best service to our clients to have ego clashes. Moreover, we share the same vision when it comes to technology. For us it is just the beginning. We have set big goals for ourselves,” says Pai.