Back to his core competence: hiring

He is 55 years old. He has just started his second innings as an entrepreneur. He is a member of the Legislative Assembly in Tamil Nadu and hopes to contest the elections again, though from a different party. His first venture was a pioneer in the flexi- and temporary-staffing space, which he ran for almost two decades before selling to a multinational.

“I see no reason not to create. I don’t think 55 should be a criterion,” says K Pandia Rajan, Chairman and Managing Director, Ma Foi Strategy. His new venture, which he launched in August last year, is called CIEL HR Services. And, it will be in the same space that Ma Foi was when it got into helping companies with their staffing requirements.

Ask him about his journey as an entrepreneur, Rajan attributes it to his village, in southern Tamil Nadu, and the community he hails from. “You are respected if you are on your own. Even if you are getting a good salary and if you are working for someone else, it is seen as a negative,” he says.

An engineering graduate and an MBA from XLRI, Rajan worked in various companies for a few years, where he got insights into staffing issues.

“My wife and I started on our own on August 15, 1992 with a small advertisement in The Hindu , which said let us engineer your future overseas. We started the deputation business,” he recalls. “I started the company with very little equity.” As the business grew, he roped in investors – 276 of them, small investors – and three venture capital firms. The 1990s and the early part of the next decade were a tumultuous phase for the company, when Rajan recalls re-writing the business plan at least six times. Still, Ma Foi’s business grew and it had overseas operations.

Turning point The turning point came in 2004, when Vedior, a multinational, invested in Ma Foi. Still, the arrangement was such that Ma Foi was allowed to retain its individual identity thanks to the loose confederation structure that Videor encouraged and followed. But when Videor got acquired by Ranstad, another multinational, Ma Foi had to give up its identity.

Rajan’s operational role ended on December 31, 2010 but he stayed on as chairman of the integrated outfit for three years, during which period because of a non-compete clause he could not start another venture that conflicted with the integrated business. “At the end of three years, they had to give the brand (Ma Foi) back to me. That was the deal. In those three years, I was allowed to do things which didn’t conflict with their work. I couldn’t do recruitment and staffing,” he says.

Even as he got elected to the assembly in 2011, he kickstarted Ma Foi Strategy, with interests in consulting, analytics and business intelligence; analytics and business intelligence are now separate companies under the Ma Foi brand.

Once the non-compete period was over, Rajan got back into his original space – recruitment and staffing – by launching CIEL HR Services, with other partners. “We have done well. We have now over a 100 clients,” he says, even as he chalks out expansion plans. He is also confident of clocking revenues of ₹1,000 crore in five-six years with CIEL, something he took 18 years to achieve with Ma Foi. He is in five different businesses now and the fund requirement of each is different.

Lessons learnt What were his lessons from Ma Foi and his selling out? He says 2004 was the cross-roads for him – whether he should go for an IPO or rope in a strategic investor. Because of the prevailing market conditions, he chose the latter. Now, he says he will go for a public listing of his new venture rather than a strategic sale.

He is not averse to bringing in venture capital firms, but he would try and retain a majority stake.

Also, he would not go in for a large number of small investors as he did the last time.

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