APJ Abdul Kalam & this Coimbatore Youth

Being a Corporate Finance consultant comes with its own perks.  We get to meet various types of people – pious gentlemen who largely underscore their success, people who fry Vadas with their tongue and saliva, yet manage to sell them to unsuspecting listener, people with high dreams, people in no hope situation, people who have made us look like Einstein, people who make us dwarf in front of them by sheer intelligence  . . .

We see them day-in and day-out on our work day.  It is fun at times and simply exasperating on their times.  Our profession oscillates in a pendulum, all the time between sublime and ridiculous.

Today morning my hand phone had a missed telephone number.  These days people who hold physical shares ring us because of the services we offer.  This means, I have to return calls of all unknown numbers.  My returned calls often ended up in the desk of tele-marketers, who wanted to give me personal loan, sell me a piece of land 30 kms away from Vedanthangal or simply to an NGO which has a child whose life depends on my donation.  Tired, as I was, I gave up my resistance to Trucaller and I have become a Trucaller regular.  If there is a call, that I could not attend, I invariably return it, if true- caller doesn’t call it a spam number.

This caller was legit and so I returned the call. 

“Sir, I am Gopalakrishnan, I have a venture capital requirement for 40 crore rupees.” –  venture capital and 40 crores!  Wonderful. At 3%, I already have Rs.1.2 crores in my Bank Account.

“Tell me about your company.  What do you do?” 

“Sir, we have electric motor cycle prototype ready.  We are planning to manufacture and market it all India”. 

“Planning to”, and forty crores?  Motor vehicle manufacturing and marketing all India in forty crores?  Futility of the proposal is quite obvious.  No point in wasting time.  However, the bubbling enthusiasm in his voice and his faith in what he is doing prevented me from hanging the phone.  Surely, this boy is serious.  Still, there is nothing I can do, and I changed the subject.

“How did you get my number”?

“I got it from your company profile in Smergers”.

Being visible in mergers and acquisition platforms is bane too.

Fortunately, he continued.  “Sir, I am travelling, can I call you after 12 O’clock?”

I want to say “No need” instead I ended up, saying okay. 

Phone rang and 12 O’clock it was.  I went into an existential dilemma. ‘To pick up or not to pick up’ the call, that was the question.

Electric Motor Cycle
Photo Courtesy – Confused.com

“Yes, Gopal tell me why you need 40 crores”?

“I am going to import CKD kits.  Engines are manufactured by Bosch.  I have to have an assembly unit in Coimbatore and market the electric bike through out India.  I have made a business plan and I need 40 crores.

I was incredulous. 

“What have you done so far?”

“Sir, I have developed prototype and have assembled a motor bike.  I am driving it. In two hours of charging, I can run 175 kms at a maximum speed of 100 kmph”.

The voice is so young, I couldn’t help myself asking this questions.

“What is your age?”. He said, twenty four

Fresh out of college and not out of his fourth-year project perhaps.  I asked him “Do you realize, this is a huge game?”  ,

“What made you get into this immediately after your college?”
“Sir, I have been doing it for past 2 years, I am a great fan of Abdul Kalam”.  You, me and everyone else. 

He continued, “I have developed all the products and arrived at the specifications that will make the vehicle, more efficient and stylish. Better than whatever we have now. It will be lot cheaper than the existing products.

I didn’t want to tell him what I thought. It is hard to insult any dream.  Let alone the one induced by Abdul Kalam.  I have to cut short the conversation and get on with my work.  So, I said, “Send me the business plan. I will have a look at it and get back to you”.

“Sir, I cannot share the specifications.  I did not know about IP etc., and ended up explaining to an industrialist and requested him to fund me.  Instead he started his own unit by using my specifications”.

I have heard the lines quite a few times and it impresses no one.

He then, went on to explain what he has done so far.  He took his college project very seriously.   Disciple of Abdul Kalam that he is, got attracted by make in India slogan and he decided to make an electric powered motorcycle in India.  He never asked himself, how is assembling CKD from abroad tantamount to ‘Make in India”.  He was in a dreamy age, as it is.  Abdul Kalam want him to dream and Modi wanted him to make in India.  Lethal combination. He set out to do just that.  Only problem is he wants to do a billion-dollar project in 40 crore rupees that will give him a return of 25 million dollars in 3 years flat.

“What is your present infrastructure, how many people work with you?”

“I have 5 college trainees working with me”.

My silence perturbed him.  He wanted to give me a confidence.

“I have a perfect marketing plan too. Once I announce, I will be able to get 5000 bookings.  I have positioning similar to Jaguar”.

My dear boy, do you know what are you talking about? He continued, “Sir, I went and met Nitin Gadkari.  We were to launch the project by December 2018, and he was to come and inaugurate”.

Madness is growing by the minute.  But I asked him, “Then what happened”?

“Sir, I have a partner”. Just when I thought I have complete grip of the situation he bowls a googly.  He continued, “We were equal partners and he has given the money to build the prototype that I am driving and for my travel.  However, he is standing in MP election now and he wants to withdraw”. 

I am completely bowled.  Still, breaking someone’s dream is very difficult.  I then patiently explained to him, how VCs operate and why it will not fit in the scheme of things of venture capital investors.  If he is serious, he has to raise some money, Rs.3-4 crores to create some 25 motor cycles and then look for serious money.  He has to have a few industry experts by his side. 

He then asked me whether he would get Mudra loan.  Mudra loans are not for electric automobile.  They are for Elandha Vadai and perhaps Pakkodas.  I didn’t want to be Arnab Goswami’s enemy and so I passed the thought. 

I have seen quite a few young brilliant brains toiling in startups.  Entrepreneurial bug is quite potent.  I thought I should at least to make an attempt to straighten his life. I said, “Look, here is what I will do for you. send me whatever material you have, I will have a look at it.  If I am convinced, there is something to it I will try to introduce you to a few people who may handhold you.  They are successful business men for whom losing a few crores would not hurt. If the reward is right, they might risk capital.  I have to be completely convinced before I talk to any of them. You meet me in the first week of April in my office.  Today, after this call go to Amazon and buy a book called Lean Startup.  Read that and come and meet me after that”.

This was a quite an encouragement for him and agreed to meet me in the first week of April. And I started writing this blog post.

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