Start-Ups Can Never Be Family Businesses

How does one go from being an average Indian student from a family with no business background to becoming one of India’s most successful tech entrepreneurs? Ask Girish Mathrubootham, the son of a bank officer, who is giving the bigwigs of Silicon Valley a run for their money.

Over the years, “G”, as his employees call him, has proven that success takes more than a legacy family surname and that it takes hunger, grit and talent to spearhead an idea to solve a problem. Armed with all three, Mathrubootham was quick to grab the idea when it presented itself to him over a decade ago.

In 2010, after he failed to get a reimbursement from an insurance company for a damaged TV, he knew he had a problem to solve: limitations of the available customer support tools. When he set out to fix it himself with Freshworks, then Freshdesk, people who knew him knew he was onto something.

His entrepreneurial acumen had kicked in early. “My parents divorced when I was seven and I grew up with my father, so I did not really grow up in a protective environment,” says the CEO.

From what to study to where to study, most decisions were taken by a young Mathrubootham himself, who grew up in a quiet town in Tamil Nadu. “That taught me to live with the consequences of those decisions and learn from my mistakes—a skill needed in an entrepreneur.”

What started in a 700 sq. ft. Chennai warehouse with some staff went on to become India’s first software as a service (SaaS) unicorn and also the first Indian SaaS company to get listed on NASDAQ.

However, Mathrubootham’s illustrious journey to the top, as a first-generation entrepreneur, was far from easy.

Building from the Ground up

Unlike scions, start-up founders have to go through the rigmarole before launching their companies. The former come from families that have both the money and the might to help establish themselves easily. Since Mathrubootham fell in the other camp, he had to overcome his fair share of hurdles.

“We were completely bootstrapped initially and found it difficult to pay salaries on time. In fact, we could not hire female employees because we did not have the infrastructure for them in terms of washrooms, etc.,” recollects Mathrubootham.

He agrees that scions may have the advantage of initial infrastructure and money to start with, but, he adds, it does not guarantee success. In fact, he argues that it becomes counter-intuitive.
“I call this constrained creativity. When we started Freshdesk, we had no money for marketing, so I used to look for sites such as ‘30 ways to do free PR’ and list Freshdesk on websites which did free PR. This is very efficient to scale a business because if I start spending money on such things from Day 1, my unit economics will become inefficient,” he says.

The other big problem that Mathrubootham faced was hiring the correct talent. “There was no been-there-done-that talent in India, so we had to hire a lot of freshers and train them. We let Freshworks grow organically and built our own way of hiring where we identified core talent even if they did not have the experience. We bet on the people’s ability to learn,” he says.

This is where mentors come in and having worked with Zoho for nine years, Mathrubootham learnt the value of relationships and identifying talent from Zoho’s Kumar Vembu. “He spotted me to take the role of a product manager when even I did not know that I could do that job. He was probably my best boss,” he says.

Mathrubootham seems to have carried those sentiments to Freshworks as well. “At Freshworks, we help employees realise their strengths and ensure that they play to their strengths. Building genuine relationships, creating a happy work environment, defining true craftsmanship where you do not settle for mediocrity and doing something that is truly appreciated by the customer are our other core principles,” he says.

One of the CEO’s foremost principles has been to ensure wealth creation for his employees. It does not come as a surprise when one learns that 76% of his employees are shareholders in Freshworks and that 500 of Freshworks’ employees became crorepatis with the company’s listing on NASDAQ in September last year.

Apart from Vembu, Mathrubootham, who likes to keep his employees close to his heart, also looks up to superstar Rajinikanth, whom he takes immense inspiration from. “I have learnt that from him. More than an actor, he is an incredible human being. His humility is what I try to practice in my life as well.”

Picture-Perfect Products

Playing the central characters in Freshworks’ success story are its products, which have helped it gain its massive customer base. Mathrubootham says that the software company set out with a simple vision—to create business software that customers actually love. Today, over 50,000 companies use Freshworks’ user-focused cloud-based customer service softwares to enable a better customer experience and employee experience.

“A lot of times, enterprise software is clunky and users hate it. We bring in differentiation there … If the product does not appeal to the user aesthetically, functionally and intuitively in terms of usability, they will just close the browser and go away. So, we had to build our product management, product design and marketing making everything super easy—easy to buy, try and set up,” he explains.

While scions may have an advantage initially in onboarding customers, he says, “Both first-time start-up founders and scions have to spot an opportunity, fulfill an unmet need, create a product and take it to the market.”

The company’s bottom-up business model, he believes, helped it perfect its products.

However, his fascination with the perfect product does not end with or at Freshworks. His dream is to see India as a product nation.

“India has been a big beneficiary of the IT services boom, and we have a huge pool of qualified talent that can build solutions for several industries. So, in the future, a lot of wealth creation can happen, a lot of employment can be created by creating product companies. I am excited to see this decade as the emergence of India as a product nation,” he says.

Harmony in Hustle

Creating a global company in 10 years is a feat not many can achieve and Mathrubootham could not have done it without hustling.

“Start-ups initially have to hustle because people need to know who you are and you have to go that extra mile to bring that early success. Once you even win one customer from a certain industry, pulling in others becomes much easier,” he affirms.

But, his idea of hustling also comes with a caveat. “When you say hustle, we need to draw the line as to what is acceptable and what is not,” he adds.

Today, Mathrubootham’s top-of-mind agenda is to finalise the company’s policy for the future of work. Freshworks is trying to strike a balance with a hybrid model for its employees across geographies, so that they can have the best of both worlds. “There are benefits of coming to the office and building those social connections and collaborating better,” he says.

He realises that the equation changes with geographies. “In India, the dynamics of the talent market are different than in the US or Europe. The competition for talent is different, the work-from-home set-up is different, the commute times are different. So, building a holistic policy is a challenge, but we are working on it,” says Mathrubootham.

Talking about investor-founder relationships, he believes that controversies are exaggerated. The VC-founder rift has been blown out of proportion, and it is a misconception that investors are against founders, he adds. Expounding his views, Mathrubootham says, “VCs do not make money when founders fail, so it is in their interest that the entrepreneur wins. When you take VC money, it comes with a business model attached to it. You cannot say invest in my company and forget about your money. Investors will need an exit in eight to 10 years, and founders have to understand that part of the contract before asking for money.”

Having said that, he also cautions that there may be investors who drive founders to blind growth without realising the consequences.

Beyond the Family Ties

Mathrubootham says that for a scion who wants to branch out and for a start-up founder, there is one common thing: both want to create something of their own. “No one wants to be celebrated because their father was successful and that is something I tell my sons as well—I may have earned money, but your worth will come from what you do.”

The hunger to succeed is individualistic, believes Mathrubootham. Giving the example of Gopal Srinivasan of the TVS Group, he talks about how, despite being a third-generation entrepreneur, Srinivasan created TVS Electronics and TVS Capital on his own. “There might be an advantage to using the brand name, but the drive and hunger to create a company is his own. It is because of his intelligence and values that he is one of the most respected businessmen in Chennai.”

The CEO talks about his investment in Hike Messenger, the start-up founded by Kavin Bharti Mittal, the son of Bharti Airtel founder Sunil Bharti Mittal. He says that while the company may have failed, it does not undermine Kavin’s abilities. “It was not easy to pit yourself against WhatsApp, but he tried and also onboarded users.”

Mathrubootham also firmly believes that unlike family-owned businesses, which get passed on from generation to generation, start-ups can never become legacy businesses. Tech companies are not in that phase, and they are designed to hire professionals, he says.

“In fact, my boys do not even want to study computer science. My elder one wants to be an architect and the younger one is still figuring out what he wants to do,” he adds.

In case they do take up entrepreneurship, the one value that he wants them to inculcate is to learn how to learn, because what they are studying in school or college today will not help them 10 years down the line, he says.

Ultimately, even in the case of his kids, it all boils down to them treating people with respect and being good human beings. “That is all that matters,” he says.

The Car King

Mathrubootham loves to splurge, particularly on cars. He bought his first car, a used Nissan Pathfinder, in 2000 and, in the subsequent years, has added 15 more to the fleet, including a Maybach S500 and a Volvo V40. While his favourite  remains his first BMW 5 series, his current obsession is his Bentley Flying Spur W12, which can clock 0­–100 kmph in 3.8 seconds.