India and the Power of Entrepreneurship

Is it unfair competition when a self-taught Indian software entrepreneur does well?

April 27, 2004

Is it unfair competition when a self-taught Indian software entrepreneur does well?

Mittal is 33 years old. The only post-secondary education he had was at one of the vocational institutes in Mumbai, from where he graduated in 1985 with a diploma in electrical engineering.

His first job, with a Bangalore-based software company, was writing reservation and billing programs in Wang Basic for a major hotel chain.

Next, he was writing code for a government department whose mandate included monitoring pollution.

Between 1988 and 1990, he wrote programs in the language “C” to manage databases on mini-computers about emission of pollutants by chemical companies.

Essentially very restless and innovative, Mittal set up his own company in South India in 1990, specializing in professional publishing software — especially for non-Latin languages.

Written in C++, this software was adopted by a number of well-known mass-circulation dailies, such as the Times of India, Ananda Bazar Patrika and the Hindu.

Gradually, he began to give well-known U.S. companies a run for their money in word processing software.

He forged a strong capacity in regional languages, like Hindi, Tamil and Urdu. In 1993, he demonstrated his software for Urdu in a trade show in Lahore — to rave reviews.

In 1995, Mittal received a contract to improve the use of color in his publishing software. At this time, he also began to do more work for international clients.

Notable among them was a British client, who ordered software (in C++) that would permit proofreading, data compression and messaging from remote locations.

Mittal was writing the software that would make outsourcing of publishing easier.

In 1998, he produced more software to assist in the international transmission and manipulation of information for high-end imaging scanning, cropping, color processing and data compression.

The industry was meantime migrating from C++ to the Java programming language — and Mittal got on the bandwagon. He picked up Java in about two months. Once he felt sure-footed, he began trawling for small contracts, first nibbling at his old British clients.

Soon his British client offered him a contract to write electronic commerce applications in Java for an online betting company, specializing in sports.

The first module was for football — that is, soccer — betting, with other modules to cover cricket, horseracing and Formula-1 racing.

Mittal’s stable of young developers set to work immediately, writing code in Java for this project. At that time, he employed six senior developers, two graphics experts, two design specialists, 11 junior developers — and two office boys.

Mittal has no resident accountant, nor secretary. He answers his own phones. He pays his senior people about $325 a month — and the junior developers about $240-275 a month.

The environment in which this team works epitomizes a no-nonsense capitalist business model. The office is on the 5th floor of a walk-up building.

The floor — all 1,500 square feet of it — is not carpeted, nor are the rooms air-conditioned. They are cooled by four ceiling fans. Lighting is unremarkable.

This Spartan simplicity is matched by Mittal’s strictly meritocratic approach to his employees. When I visited, the staff was hard at work.

And yet, the office lacked all the bells and whistles that legend has associated with offices in Silicon Valley.

Speaking with quiet confidence, always careful to document a point he was making with graphics from his well-worn laptop — and occasionally requesting priority on the lone Internet access line — Mittal spent three hours answering my questions.

I asked him whether his staff gripes about poor working conditions. Far from it, he said. His staff is beholden to him because he keeps constantly challenging them, keeping them on the cutting edge of programming.

These guys, he said, are the keenest learners. They value the experience they get at his firm. And they are not looking to move soon, regardless of ceiling fans and the long climb. In India’s Software Triangle, IT experience is a golden key to later riches.

Mittal’s business model is that he ploughs earnings back into products that he himself designs and fleshes out.

He then mobilizes his team of developers on those in-house projects. He thus generates work for his staff, regardless of whether they have a contract or not.

This generates a long-range relationship between the entrepreneur and the workers. Most of his staff are under 30, and two among the 16 developers are young women. The average age is 24 years.

These are not computer science graduates, but they have obtained certification, mostly as Microsoft-Certified Solution Developers. Mittal himself taught them Java.

As he drove me back to my hotel, Mittal told me he was off to Europe to negotiate new contracts, which would require him to double his employment of professionals.

He would lease additional space in the same building. His total billing during the two next years from the same British client could top 60,000 hours — with his gross being well over $1 million.

Leading by example, teaching and shaping, this aggressive young Indian self-made entrepreneur presents — I thought — the face of a New India to the Western World.

Regardless of where one stands on the outsourcing debate, you have to admire the entrepreneurial drive and discipline behind this successful business.