A large cohort of Infosys co-founders and millionaire ex-employees is galvanising Bangalore’s start-up scene, pouring millions of dollars in seed and angel funding, as well as setting up accelerators and incubators to give entrepreneurs a ladder up. No other single company is likely to have as much of an impact on India’s booming start-up scene, and that too through a legion of former employees.
“Infosys is India’s best recent example of the power of entrepreneurship and it is only natural that many of us, in turn, are passionate about creating and nurturing other entrepreneurs,” Infosys co-founder and former chairman N R Narayana Murthy told The Indian Express. It is an entrepreneurial “Pay-It-Forward”, Infosys style.
At Wipro, Infosys’s longtime rival, technology tycoon and promoter Azim Premji is ploughing a lonely furrow in India’s start-up scene by only making choice investments through his family office.
Murthy, three of his fellow billionaire co-founders — Nandan Nilekani, S D Shibulal and K Dinesh — and their families sold about Rs 6,500 crore worth of Infosys stock earlier this month. Over the years, numerous early employees gained millions of dollars because of Infosys stock options, earning the firm the moniker “Billionaire-Millionaire Factory”.
Many of these Infosys founders and ex-staffers have given up management roles but are too young to hang up their boots. Whilst they themselves may no longer hunger for success, they are happy to fund and mentor those who have the entrepreneurial fire in their belly. These investors are electrifying Bangalore’s ecosystem without having to break the bank, unlike like the early Infosys founders who launched the company with Rs 10,000 of their pooled savings.
Infosys has a larger network of ex-employees compared to other Indian companies and they are first-rate people, said Mohandas Pai, who headed Infosys’s HR and finance functions for many years.
“Some 250,000 employees have left Infosys in its three-decade existence, and these people are now enriching Bangalore’s start-up ecosystem,” said V ‘Bala’ Balakrishnan, former Infosys CFO who has joined hands with Pai, his predecessor, to set up the Rs 175-crore Exfinity Fund which has funded several start-ups, including a video streaming firm and a power saving solutions firm.
“In Bangalore, entrepreneurship is bubbling up in the form of a thousand new start-ups each year, and these firms will create $500 billion value in the next decade,” said Pai, who along with Bala and others is launching the $100 million Exfinity II fund.
Murthy’s Catamaran Ventures has backed several start-ups, including a drink maker and an e-commerce joint venture with Amazon. His fellow founders Kris Gopalakrishnan and S D Shibulal have joined hands with former Infosys board member Srinath Batni and Tarun Khanna of Harvard Business School to set up an incubator called Axilor Ventures in Bangalore.
“We hope to help 10-12 start-ups every year in the e-commerce, healthcare and cleantech space for a period of two-three years per start-up by providing them space, mentoring and other support services,” said former Infosys co-chairman Kris Gopalakrishnan. Axilor’s founders are individually funding chosen start-ups, Gopalakrishnan said.
Investors with an Infosys lineage could be game changers in Bangalore’s tech start-up scene. Unlike generic venture capital firms, these are specialists who understand innovation and building technology products for global customers.
With so many backers chasing good ideas, there is already a touch of competition between some. “It is but natural that entrepreneurs will shop around,” said Bala. “There is so much innovation happening that every investor has his hands full,” he added.
Bangalore is start-up country and the action in town is getting fed in all manner of former Infosys employees, said Nilekani. He, Murthy and other Infosys co-founders can fund and support new ideas but they can no longer be role models for aspiring young entrepreneurs, he said.
“Today’s 20-something generation is fearless and bolder, they are the Virat Kohlis of enterprise. They identify with 33-year-old Sachin Bansal of Flipkart rather than the Infosys story of 20 years ago,” said Nilekani.
