History revisited: The initial years at Infosys

Outgoing Infosys co-founder and chairman N R Narayana Murthy on Wednesday said the sacrifices made by his colleagues in the initial days of the company was unparalleled.

The founder members started Infosys with a borrowed capital of only Rs 10,000 but was quick to realise that the money would not last them for even a month. It was then that the dedicated team of professionals decided to lead an austere life to lay a healthy foundation.

“Realising that the Rs 10,000 would not be sufficient, we worked out a transaction deal with one of our prospective customers. We got into an agreement where the customer would give us working capital for a few months,” said Murthy, who has served the company for over three decades.

While six of his colleagues went to the US to start work on developing software, Murthy walked from pillar to post trying to get a licence from the Reserve Bank of India (RBI). “Computers were not easily available in the market. It used to take at least three years to import a computer to India at that point in time. So we decided that some of us would be based in the US to start work. But, even before travelling abroad it took us 10 days to get a permission from the RBI.”

“Besides, we did not have a telephone, and it would take one or two years to get a telephone connection. Meanwhile, I was trying to get a licence for a computer here, and every month I had to go to the Reserve Bank. The RBI had two strange rules at that time — if one wanted foreign exchange one had to earn foreign exchange and then bring it to India and share 50 per cent with them. I think, this was the most perverse rule ever invented,” he said.

In spite of the hurdles, Murthy and his dedicated team of colleagues accepted the terms and conditions by India’s central bank. “Can you imagine a situation where you have to earn foreign exchange and bring it to India and you will get 50 per cent of it in the next month? But we accepted it because that was the rule then.”

Murthy convinced his clients and made sure they paid on time. “I had to make sure that they sent money by the 28th or 29th of every month and then I would wait eight hours outside the RBI to get 50 per cent of that so that I could send maintenance allowance to my colleagues in the US.”

Times have changed, and Infosys has grown from strength to strength to become a Rs 26,000-crore Nasdaq-listed company with over Rs 11,623 crore paid out as dividend. The dedication and sacrifice of the founding members now has become part of the Infosys folklore.

“Now, my children don’t believe this. They say that I am exaggerating the facts; but that is the reality. One of our customers in New York offered us to give an IBM compatible computer on loan. They said, we can develop software in Bangalore, but we must report the customer on the progress of the project everyday on telephone.”

But, in India things do not move as fast. “This made us to go to the telephone department to get a connection. However, the department denied as their first priority was for retired government officials. Then, I asked them how can I explain this to my customer? To get a licence to import a computer, it took 50 trips to Delhi covering three years. I think the conditions in those days were extremely tough and we went through many of them.”