LOS ALTOS HILLS, Calif., United States
Romesh Wadhwani, founder, chairman and chief executive officer of strategic private equity firm Symphony Technology Group in Palo Alto, Calif., relishes solving large problems, not small ones.
Whether it is sowing the seeds of innovation like an entrepreneurial Johnny Appleseed, urging President Obama to consider policy changes for the U.S. community college system for more skills-based instruction, or building an analytics-based company with nearly $3 billion in sales and more than 17,500 employees, the Indian American entrepreneur seeks out major challenges.
One of his most daunting issues has a personal resonance for him, but more on that later.
In a wide-ranging interview with India-West at his home here in Silicon Valley, the cerebral Wadhwani discussed the approach to philanthropy of his family foundation and his major projects in India and the U.S.
Called by Forbes magazine a “comeback techie,” Wadhwani, 66, made his first fortune in 2000, when he sold his software firm, Aspect Development, to Sanjiv Sidhu and Ken Sharma-founded i2 Technologies for $9.3 billion in stock.
When the tech bubble burst in 2000 and much of his fortune evaporated after i2’s shares sank, he invested $250 million to launch Symphony Technologies, which has soared under his leadership and made about 25 acquisitions of other companies, primarily in the software and software services sector.
Wadhwani told India-west that he owns “30 percent to 100 percent” of the companies (mainly the latter percentage), which are at “the intersection of markets” in consumer-packaged goods, health care, financial services, talent management and other sectors.
His strategy he added, is to “recruit talent” and technology and position himself as a “long-term strategic investor,” “building and investing,” not (seeking) a “short-term profit.”
He returned to Forbes’ list of the 400 richest in the U.S. in 2009 and placed in a tie for 260th place on the list in 2013 with an estimated net worth of $2.1 billion.
Wadhwani, like many other Indian American techies in the 1960s, arrived in the U.S. in 1969 with a strong technical background, little money and big dreams.
Sunil Wadhwani, a co-founder of IT company Mastek, which later became iGate Global Solutions, is his brother. A graduate of the Indian Institute of Technology in Mumbai, Romesh Wadhwani received M.S. and Ph.D. degrees in electrical engineering from Carnegie Mellon University.
Wadhwani told India-West that he spends about 80 percent of his time running Symphony Group and about 20 percent on philanthropy projects and entrepreneurship building in India, which is astounding given the scope of the Wadhwani Foundation, which has assets of more than $100 million.
Wadhwani and his wife, Kathy, in 2012 signed Bill Gates’ and Warren Buffett’s Giving Pledge, according to Forbes India, which named him its “Distinguished Non-Resident Philanthropist” in December last year.
The magazine said the Wadhwanis, who have one child, a recently-married daughter, already have exceeded the Pledge goal of committing 50 percent of their wealth to charity by making a commitment of more than 80 percent. The square-jawed, white-haired Wadhwani speaks with a particular passion about entrepreneurship and its benefits.
He addressed the issue of red tape strangling entrepreneurs in India the way a gardener might talk about weeds and slugs. “There really should be simplicity in starting a company in India,” he said. “The analogy I make is that you shouldn’t be audited before you start a company. In India you can’t start a company until you get (a series) of clearances.” The various labor regulations are a second barrier to entrepreneurship, he said. A third is a lack of access to R&D capital.
The Wadhwani Foundation, founded in 2003, hopes to help launch 20,000 companies over the next 10 years through its National Entrepreneurship Network initiative. NEN can document 300 companies spawned by the program in 2011, 700 in 2012, 1,300-1,400 in 2013 and expects about 2,000 more to be launched in 2014, he said. At each of the nearly 2,500 companies NEN has mentored there were an average of seven employees and five to seven additional indirect jobs created.
If India spent even one percent of its annual budget on innovation grants, thousands of companies could be started and many more thousands of jobs would be created, Wadhwani maintains.
He calls what India has done so far in this area “lip service.”
“How many companies got started and how many jobs got created?” That is the true measurement standard, he said dismissively. NEN acts as a mentor and resource for start-ups, but eschews being an angel investor.
“We don’t want to be an angel investor. They would then see us as their competition. We don’t want to be seen picking winners or losers. We want to provide the support they need to learn the principles of entrepreneurship,” he told India-West.
The foundation provides courses on entrepreneurship in more than 50 different topics to about 500 Indian colleges and universities. About 350 entrepreneurship clubs have been started at the schools, there are more than 3,500 experienced mentors in NEN’s network, and about 100,000 students take the courses annually, he said.
Topics include venture finance, skills training, how to write a business plan, etc.
Ten years ago in Indian universities, Wadhwani pointed out, there was “not a single faculty member teaching about entrepreneurship.”
In addition to dropping red tape for start-ups, he is discussing with central and state governments about setting aside about 10-20 percent of procurement orders for start-ups.
Another main focus of the Wadhwani Foundation in India is its Skills Development Program. “Only 15 million jobs have been created in India in the past seven years, roughly two million a year,” he said, adding incredulously that it was a period when the country’s GDP “grew by 60 percent.”
The foundation’s goal is to train five million people with marketable skills over the next decade. The foundation has targeted 10 occupations, beginning with a nurses aide/home health worker program launched about 10 months ago. “India needs two to 2.5 million nurses aides,” Wadhwani said. Progress is slow because separate technology platforms have to be built for each job target.
Online nursing courses and classroom training, developed in collaboration with Narayana Health, are provided by the foundation to hospitals in India at no cost. Future plans include scaling the training programs down to smaller cities, towns and even villages.
The foundation is also working with the federal ministry of human resource and development and state governments of Haryana and Himachal Pradesh to launch a “best practices” program in four occupations in 40 schools for about 14,000 students. Discussions are also being held with Karnataka and Bihar for similar programs for the particular jobs needed in those states.
Another program in the early stages is in the financial services sector, where “there is a need for one million new jobs,” Wadhwani said. “We want to provide prospective employees who are market-ready.”
When Wadhwani was just two years old, he had a series of surgical procedures for polio, so a foundation initiative in India that resonates quite deeply for him is the Opportunity Network for the Disabled.
He admits it has been his greatest challenge and one that he vows will be successful.
"All I want is for India to live up to its law that three percent of all government agency jobs” be reserved for the disabled, he told India-West.
Currently, he added, just 0.3 percent goes to disabled people. The foundation has been able to train and place about 3,000 to 4,000 of the disabled annually in jobs, he added.
India’s Supreme Court in October ordered the federal government and states to implement in three months the 18-year-old law mandating the three percent reservation for government jobs.
“India has a unique talent pool of an estimated two to three million educated disabled,” Ajay Kela, president and CEO of the Wadhwani Foundation, said on the foundation Web site.
“Corporate India could derive better business value in terms of higher productivity, reduced attrition and lowered retraining costs by employing this proven and tenacious, but generally ignored talent pool.”
In January 2012, Wadhwani and his wife were in Mumbai to inaugurate the Wadhwani Research Centre in Biosciences and Bioengineering at IIT-Bombay, a research center named after his late mother, Shanta Wadhwani. “There is a desperate need for “world class research in India,” he explained.
He has also been working with Union Minister for Communications and Information Technology Kapil Sibal to launch community colleges in India for skills development. India has made a commitment to set up at least 200 such institutions.
Wadhwani told Forbes India that if the government funds the infrastructure for the colleges and recruits the appropriate faculty, his foundation will fund the knowledge infrastructure, including the tech platform and the online course curriculum.
Wadhwani told India-West that he used to extol the community college system in the U.S. in his talks with Indian educators, but he became more critical of the U.S. system several years ago when he saw that “greater specialization is needed in skills development” in the U.S. Academic college degrees “may not be the right thing for everyone,” he said.
The Indian American philanthropist told President Obama as much, when he met him in 2012. The foundation has launched its first initiative in the U.S., the “Race to a Job” program.
The foundation is preparing to train students for high demand mid-skills jobs spanning the fields of healthcare, IT, manufacturing, and automotive and has signed MoUs with two community colleges in Maryland and New York.
Wadhwani has also discussed with community colleges in California the possibility of reserving “a portion” of their curriculum for “100 percent” skills development degrees, such as in nursing, car mechanics, etc., with the long-term goal of having some local community colleges reserved solely for skills education.
All this is on the Indian American’s plate, in addition to serving as a trustee on the board of the Kennedy Center for the Performing Arts and on the board of the think tank, the Center for Strategic and International Studies, both in Washington, D.C.
The Wadhwani Foundation launched a U.S.-India policy initiative at CSIS, where the Wadhwani chair holder is former Assistant Secretary of State Rick Inderfurth.
In addition, Hemant Singh, most recently Indian ambassador to Japan, heads the Wadhwani program at ICRIER, a major policy institute in Delhi.
Wadhwani’s 20 percent time commitments to philanthropy, entrepreneurship and policy seem more than just a plateful.
Read more at http://www.indiawest.com/news/16117-romesh-wadhwani-nurtures-entrepreneurship-in-india.html#i2zqqQIf7clqAVo1.99