Chairman of the Mahindra Group: The experiment was about trying to understand or to figure out: How do large business groups incubate and build new businesses? How do you create a sense of entrepreneurship inside a large group?
FinTech BizNews Service
Mumbai, August 12, 2024: Mr Anand Mahindra, the Chairman of the Mahindra Group, Mahindra & Mahindra Limited and Tech Mahindra Limited, delivered an extra-ordinary and inspirational speech at the 'First Cry' listing ceremony. Here is the text of his speech:
I am sure that the question upmost in your mind when you see me at the podium
is: What am I doing here? Why am I here?
I’m here because it’s actually a moment of great pride for the entire Mahindra
group.
The next question in your mind is: This much pride for a sizeable stake in a
company?
I am here because of the story behind that stake. The story is about an
experiment, in management if you will, it’s a lab experiment you might say. The
experiment was about trying to understand or to figure out: How do large
business groups incubate and build new businesses? How do you create a sense
of entrepreneurship inside a large group?
To answer that question, in 2010, ironically when FirstCry was born. We created
Mahindra Partners. That was our attempt at trying to create this experiment in
entrepreneurship. The mandate for Mahindra Partners, was that they should be
investing in incubating companies, particularly in the new age fields. They
would of course have to do that while competing with a variety of startups, and
frankly nobody is betting on the large companies, as you know. So, I asked one
of my colleagues Zhooben Bhiwandiwala and another colleague Parag Shah to
join. Zhooben as senior Managing Director of the company and then Parag as
the Managing Director. They are both here today. Their mandate, as I said, was
to isolate this kind of mentality of the startup. To our minds, the really
differentiating mentality of startups is that they worship at the temple of value
creation. Almost to the exclusion of everything else. They are not there
necessarily to build empires, they are there to build and create value; and that
his why they are so agile; so nimble; and so focused. That’s why nobody bets on
large companies to create new businesses.
Now if we found that they invested in businesses where the value creation was
better done in the large company, under the umbrella, or aegis of our large
companies, so be it. We’d build them as a new vertical. But if they found that,
greater value would be created by ceding control or ceding leadership, so be it
too. And so, they worked first on Mahindra Logistics, a company that was a
division of Mahindra. They took it out, grew it dramatically, created
extraordinary value. They then created Susten, a new age business in new age
renewables, new energy, solar to be specific to begin with; and that’s been very
successful. Both these are now solid pillars of the Mahindra group. As well as
Mahindra Accelo which was the first business of the group that was the first
business of the group that they transformed from a trading business to
manufacturing powerhouse.
Then they invested in Mom & me which was a business in clothing and other
goods for newly born children, for infants and beyond. The identical space that
Supam is fighting in. After a while they felt that consolidation is the path value
to creation, so we acquired Baby Oye, we were still fighting Supam.
One day Zhooben came to me and said, “You know Anand, I’ve studied this
man and he is brilliant. He is an innovator, he is passionate, he focuses
relentlessly on efficiency. He has a global vision”, which I am delighted to hear
today is manifesting in UAE and Saudi. He then said, “this is the time for us to
really create value by consolidating with them. I think we’ll be better off
supporting him rather than fighting him.” That, ladies and gentlemen, is why we
merged with FirstCry and at that time became the largest shareholder. After that
you know, Supam went like a rocket ahead. He has created a delivery system
that is the envy of many global online retailers. Which, I suppose, is what
attracted Softbank of course to come in, and of course the rest is history.
So, I want to end by saying here today that we are extraordinarily happy to be
here. I want to congratulate you Supam, and your entire team that is here, and I
want to express our gratitude for creating value for yourself and your team. I
want to congratulate you and express my gratitude for creating immense value
for Mahindra. And I want to thank you in particular for creating enormous value
for this country.
