I Could Not Bear To Be A Failure
ROOTS
As the eldest son of a conservative Marwari family manufacturing automotive components, I was expected to join my father. After graduating in commerce in 81, I floated from one company to another in our group for three years, trying to fit in. I got a stipend of Rs 3,000 and the fringe benefit of a car. Finally, I took charge of sales and marketing of the flagship company. This was my first brush with advertising as I had to deal with various agencies.
But my methods clashed with my fathers. He felt I was in too much of a hurry to make it big and I felt that the times had changed since he started out. He was all ready to set me up independently but I wanted to do something creative without being accountable to him. With a readymade office I would never be able to quantify my own achievements.
Starting Out
During this time, a friend with experience in advertising was setting up his own agency in Mumbai. He asked me to join him as a minor partner. A verbal commitment and input of Rs 30,000 towards the seed capital of Rs 1.5 lakh and I was in. Actually, I look upon it as seven months of training. Things were not very difficult as nearly half the clients were those he had serviced earlier.
I was to eventually set up a branch in Delhi. So, in early 86, I was back in Delhi. My familys 300 sq ft rented office in Greater Kailash I was vacant and I leased it for Rs 1,500 a month. Within four months my friend and I had decided to work independently. In May 86 Crayons opened with a team of five - artist, account executive, accountant, peon and a receptionist-cum-operator.
Initial Investment
My friend returned my investment. With that and some more savings I had Rs 57,000 with me. I borrowed Rs 50,000 from an uncle, a friend put in Rs 1,500 and my sister Rs 3,000. These two are shareholders even today. Some more bit loans and I started with a kitty of Rs 1.7 lakh. My father never learnt about the loans till I had repaid them.
Make or Break
Life was far from easy. I had no background in advertising to offer but I talked clients into giving me a try. The first one gave me an order of about Rs 4 lakh spread across a year. But I soon faced a crisis when the Oswal Agro group gave me the job for designing catalogues and wrappers for a new soap. A job worth Rs 60,000, following the 50 per cent advance, I have till date not seen the rest of the money. I could ill afford legal imbroglios. Still, the year ended with a turnover of Rs 18 lakh but net profits of only about Rs 3,000.
The first three years saw many such defaulting clients and delayed payments. We were still a kind of briefcase firm. The big names would not touch us. I often thought of closing shop and running off as I could not bear facing the family as a failure. But patience, perseverance and understanding our creditors helped me tide over this period.
Turning Point
1989-90 was the year of change. After chasing the BABA Tobacco group for nearly a year, we clinched the account worth Rs 45-50 lakh. Another break came when we won a case against the United Group and were repaid Rs 1.5 lakh plus interest. We absorbed all our bad debts, wrote off some others and started with a clean slate.
We started picking clients we could grow with, including some PSUs as well. In 90-91 we crossed a turnover of Rs 1.4 crore. That year we had truly arrived. To remain competitive, we invested around Rs 1.5 lakh in special software.
In 95 I bought our present premises (3,000 sq ft), took staff to 36 and earned profits worth Rs 45-50 lakh. Next year our branches in Mumbai and Chandigarh opened and we diversified into media-buying and software production.
Rules To Play By
There are no short-cuts to success. The only way was to learn from ones own mistakes and I made many a costly error. Inexperience made all kinds of clients seem attractive and I burnt my fingers often. But it almost became a fetish to be able to stick to my decision to make it on my own.
In this line, there is no dearth of creative people. But our USP was to win the trust of our clients by stretching their money to the optimum use.Yes, I made my money. After all, this natural by-product of any business is the only yardstick to measure success. Even so, when I started, I was staying with my parents (still do), this field was less professional and work was mainly manual. I could thus manage with the small seed capital and concentrate on innovative ideas. To start today, my money requirements would be too large and it would probably not be that easy.