Nurturing an enterprise with society at the fulcrum of operations: Ravi Kailas, Founder and Chairman, Mytrah Energy
Radical changes are never easy to implement - but as an entrepreneur, I had learned that transition and transformation are always the most difficult and most rewarding periods of one’s existence, writes Kailas.
“In a free enterprise the community is not just another stakeholder in business but is in fact the very purpose of its existence.”
This quote by Jamshed ji Tata always struck a chord with me. Trusteeship, or the idea of holding surplus wealth in trust for the greater welfare of society has a long and storied history in India. The idea was popularized by Gandhi, who dreamed of an egalitarian society created, not out of violence, but from the moral reform and voluntary trusteeship of the wealthy. To Gandhi, wealth did not belong to any individual. Those who created surplus wealth, beyond the standard of living enjoyed by the majority, should treat such wealth as belonging to the greater community, and see it as something created for the sole purpose of enhancing the welfare of that community.Jamsetji Tata, the famed founder of the Tatas, exemplified this philosophy. He understood that creating value for a greater community defined entrepreneurship.
Throughout my three decades as an entrepreneur, I worked across domains, geographies, problems and people and created various successful ventures. At 16, I travelled to India’s distant ports, arbitraging heavy machinery in shipwrecked auctions and reselling them to industrial companies. At 25, I founded Zip Telecom, raising $15 million (significant capital in the early 2000s) in one of India’s first venture-backed companies. At 30, I founded a real estate options company that was just one piece of paper: a cleverly structured options contract that allowed me to profit from the commercial real estate boom in Mumbai. At 45, I raised $80 million in equity on the London Stock Exchange for Mytrah, one of India’s first independent renewable power producers, armed with no experience in infrastructure and two full-time employees.
But in spite of these material successes, I felt a serious intellectual and spiritual void throughout most of my entrepreneurial career. Something fundamental was amiss, I felt, despite the external validations of success. I had lost sight of the core purpose of my art form and I had to find my way back.
Radical changes are never easy to implement - but as an entrepreneur, I had learned that transition and transformation are always the most difficult and most rewarding periods of one’s existence. Once I was able to confront that I had lost sight of fundamental purpose, I stepped away from entrepreneurship, exiting all three companies I was actively managing within months. I vowed not to return until I had found deeper meaning, and embarked on a five year journey of introspection, reflection, meditation and learning.
During those five years, I read books on the history of entrepreneurship and the origins of capitalism. I was searching for the answers to fundamental questions: what was the purpose of the activity to which I had dedicated so much of my time and efforts? What was its ultimate aim or value? What was the relationship between wealth and value, and how could they would either be defined and distributed by an entrepreneur? How did the current practice of entrepreneurship create detrimental impact on society - such as widespread inequality, adverse climate change, social unrest, or the erosion of democracy?
Whereas books offered me the context to diagnose my qualms, meditation offered a practical reworking of my relationship with myself and the world. I realized that as an entrepreneur, I had been focusing on my ego: my idea of entrepreneurship, my success, my tangential solutions. I had lost sight of the entrepreneur as the guardian and steward of value-creation, not for oneself, but for an ecosystem of stakeholders and for society at large.
When I founded Mytrah Energy, I was just exiting my period of introspection. I had studied various models of corporate ownership - and I deeply wanted to build a company whose fundamental purpose of creating value for society at large would be built into the organization itself. Despite looking at multiple historical examples, the answer was much closer to home: trusteeship.
By entrusting my shares at the inception of Mytrah to a charitable trust, I forever changed the identity of the company. No matter what size Mytrah became, it would always be a company that was founded with an inextricable link to deliberate, collectivevalue creation. Unknown to most people at Mytrah, they worked for a company where the majority of “shareholder value’ or profit would go to others.
The shares I entrusted would be worth more than 1 billion dollars by 2017. I only hope that they will be worth many, many more times that amount in the future decades. Yet I also cannot ignore that this amount is barely the tip of the iceberg when we consider the social development shortfall in India, a shortfall that amounts to tens of trillions of dollars. For this country to see proper infrastructure and service in education, sanitation, livelihood and basic well-being, the scale of efforts and capital required is enormous. On the other hand, over the next two decades, India will be creating an extraordinary amount of wealth - given the 7% GDP growth every year, nearly $15 trillion will be added to the economy. The most pressing question remains: how will this wealth be put to use?
We must work to aggregate resources for the development needs that face this country. Indeed, rather than various fragmented, disconnected efforts at social development, India could benefit from resource-sharing and knowledge-sharing across the many organizations operating within its borders. Only by sharing resources and knowledge and tackling issues in cooperation will we see the scale of change required to build a new India.
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