At 30, Steve Jobs had revolutionised personal computing with the Apple brand. It was 1985 and he was already a millionaire, working with his team on developing the Macintosh computer. Colleagues found him too temperamental, brash and demanding. The board eventually sidelined him and Jobs quit the company he had co-founded in California’s booming Silicon Valley.

Back home, decades down the line, online realty start-up Housing.com’s Rahul Yadav may have learnt the same lesson, in a similar way. Temperamental, brash and tactless, Yadav got into trouble with investors, who eventually dropped him from the company he had co-founded. “The Housing.com board unanimously agreed to bring Yadav’s tenure to a close, with reference to his behaviour towards investors, ecosystem and the media. The board believed that his behaviour is not befitting of a CEO and is detrimental to the company,” it said in a statement.

As India turns into a breeding ground for start-ups, entrepreneurs and young CXOs, the old order in organisational culture and attitudes is being challenged like never before. “While I don’t think irreverence for time-tested truths is necessarily a bad thing, one possible concern for a younger CEO could be emotional immaturity. Being a CEO, one has to be resilient to knocks, work with humility and learn to carry the team along (including being subservient to the team when needed),” says Padmaja Alaganandan, executive director — consulting at PricewaterhouseCoopers.

According to a 2014 global study by advisory firm Zinnov, the average age of CEOs who founded companies after 2000 is 36, compared with 39 for the founders who came before. The study, across the global 500 R&D spenders, also found that the average age of CEO appointments has fallen by four years after 2000.

It is no different in India, where young founders have stormed the market. From Amazon to Snapdeal and Zomato to Paytm, online business is dominated by CEOs — whether appointed or founder — under 40. This is also true of social enterprises — the for-profit firms producing goods and services for bottom-of-the-pyramid clients.

Out of depth

Lakshmanan Prasad, professor of organisational behaviour and HR management at IIM-Bangalore, says younger people take more risks but some run into trouble as they lack managerial depth.

Yadav is a case in point. Aparna Jain, integral master coach and founder and CEO of Zebraa, says Yadav is fabulous in terms of his technology vision but is in need of a well-rounded strategy. “If you work on ego or impulse, then it’s OK if you are a Steve Jobs. But the fact is that not everybody is a Jobs and not everybody has the patience to put up with a Steve Jobs."

She observes that while most start-ups today have passion and tech capability, they lack the skills for teamwork. “They have a vision of how they want the product to look but not the vision to manage the company. They have disjointed skills, making it difficult to create a solid team,” she adds.

It is here that coaching gains importance. Dr Ashwin Naik, who co-founded affordable healthcare services chain Vaatsalya in 2004, says it is challenging to juggle multiple roles during the early stages of the entrepreneurial journey, particularly for first-timers.

“As they say, it is lonely at the top. A coach can bring in fresh perspective, which could open up a new set of opportunities,” he adds.

Prasad points out that when young entrepreneurs or founder-CEOs rise too fast to the top, they tend to lack perspective. “And that is why many of them are running into trouble. It takes 15-20 years in the trenches before one can begin to appreciate the bigger picture, and many people just don’t get that, while a handful will understand this at age 35 or 40.”

Vijay Shekhar Sharma, founder of e-commerce shopping website PayTm, is among those who got it right early. At 21, he set up One97 Communications, focused on mobile and DTH recharge through website. In 2010, PayTm was set up to recharge through mobile, and by 2014 it metamorphosed into an e-commerce player competing with Flipkart, Amazon and Snapdeal.

For Sharma, age is not a factor for success. As also for Nalinikanth (Nal) Gollagunta, who runs Cisco’s commercial sales business in India and the SAARC region. “To me, age is just in the mind. Whether it’s a start-up or an established business, what is critical to run it successfully is the ability of the leader to connect with and inspire the team, align them to the organisation’s goals and empower them with creative freedom to deliver results.”

This philosophy seems to have paid off for the 39-year-old Gollagunta, who accounts for nearly a third of Cisco’s country revenues. “I believe a successful career is like running a marathon rather than a 100m dash. Ultimately, what wins is the power of your ideas, your conviction in them and your ability to deliver on them,” he adds.

Enter the CEO coach

This kind of derring-do is inspiring investors to put their money and faith in ideas promoted by young entrepreneurs and CEOs. “In many start-ups, particularly in the technology space, the CEO is getting younger as young professionals keen to start out on their own have easier access to private equity funding. Younger CEOs often are bigger risk-takers, as they have a limited frame of reference for what can go wrong,” says Alaganandan.

However, in order to offset inexperience with worldly wisdom, investors are increasingly insisting on corporate coaching for start-ups. To help social entrepreneurs hone leadership skills, umbrella organisation Sankalp Forum has tied up with OD Alternatives, a consultancy for organisation development and leadership.

Founded by Santhosh Babu, OD Alternatives specialises in corporate coaching for established businesses as well as start-ups. “A coach’s interaction with a coachee is a confidential conversation that expands one’s awareness and gives clarity. This could be why global CEOs have a coach, as they know what they want to do but are alone and want to work with someone who has clarity.”

That includes the likes of Bill Gates and Google’s Eric Schmidt. Back home, companies like the Tata Group, Aditya Birla group, Maruti Suzuki and Bharti Airtel too invest in corporate coaching to prepare well-rounded leaders.

Alok Mittal, angel investor and former MD of Canaan India, believes only two things matter in early-stage companies: building a strong product and setting up the right team. “I believe in surrounding the entrepreneur with people whom they can bank on for different aspects of the business,” he says.

However, not everyone is open to advice and mentoring, he points out.

Former Housing honcho Yadav, for instance, seems intent on clinging to his beliefs. “While he would have benefited from coaching, we need to keep in mind that only a seeker can be a good coachee and not a believer,” says Babu.

Dr Naik agrees that coaching is not for everyone. “First, there needs to be self-awareness and a desire to change… the coach is there to facilitate the journey, but the hard work has to be done by the entrepreneur,” he adds.

Best advertisement

Among the many advantages they have, young CEOs best understand customers in their age demographic and the ways in which to target them. That explains why the Tata group roped in young Avani Davda, now 35, to head Starbucks India. AirAsia India CEO Mittu Chandilya too turns 35 this year.

“Particularly in the B2C (business-to-customer) segment, it is easier for a young CEO to get into the mind of the consumer and craft offerings accordingly,” says Alaganandan.

“Today, businesses need to empathise with young consumers, understand their needs, and speak and understand their language. They need to align their leadership to identify with and cater to this segment. Moreover, young leaders act as role models for younger employees,” adds Cisco’s Gollagunta.

On the other hand, lack of emotional maturity can prove a significant drawback for young CXOs, as has happened with Yadav.

“It is a globally-known fact that technology institutions produce high IQ and sharp alpha people, and EQ (emotional quotient) is not necessarily a great asset with them. And there is only one way you build it, and that is by dealing with many and diverse people,” Sharma emphasises.

Typically in a start-up, people have fantastic ideas, a lot of passion and tech capability. “They have product managers, technical teams and maybe a business development person, but how do they make teams work cohesively. Especially as they grow? That’s a skill they lack,” says Jain.

Brainy and empathetic

Start-ups are required to grow from the first to the second level of funding. Most end up having the simplistic goal of getting rich.

“Instead, what’s needed is a five-year plan and a vision, which is usually missing. The sooner they invest in coaching the better,” Jain says.

Here, emotional quotient, the ability to deal with interpersonal issues, comes handy. “Emotional quotient wins every time. While there will always be a minimum bar for IQ, I find that having a spike in EQ is much more valuable to a CXO than being the smartest person in the room,” declares Gollagunta.

Prof Prasad, on the other hand, believes that IQ and EQ go hand in hand. “If a person has high IQ, he is a good nerd but will mostly lack interpersonal skills. Persons with only high EQ are like empty vessels and they become narcissists. Only if you combine both do they become really effective leaders,” he says.

Ready or not…

Even as young corporate leaders make their mark in India today, not all companies seem ready to hand over the reins to them. “In India, hierarchy is very important and you need to stay in an organisation for a number of years to prove yourself. By then the person is probably in mid- to late-40s. So I don’t think most Indian companies are ready for young CEOs,” says Prasad.

In fact, many of the young CEOs are those who start off by themselves and make all the mistakes, but customers give them the benefit of doubt thanks to the unique product or service they offer, he adds.

Gollagunta believes embracing young leaders has become a business imperative. “The average Indian citizen is 29 years old. The demographic dividend of the country is an asset and presents a huge opportunity. A healthy leadership mix of experience and fresh energy would be the best recipe for success.”

Alaganandan points out that earlier companies had 20-30 years to groom a leader and expose him/her to a multitude of experiences to prepare for the top role. “Today, the timeframe is much less, and leaders are often pulled from the pipeline before they are ready.”

Under these circumstances, organisations are faced with the challenge of nurturing leadership with the right balance of business potential and people-readiness. In Yadav’s case, it appears that he was not ready for the job despite being talented. Jobs returned to Apple 12 years later in 1997, after becoming a better leader. Whether Yadav will get a second chance to prove himself is anybody's guess.

comment COMMENT NOW