K Pandiarajan, who founded Ma Foi HR services in 1992 and sold it to Netherland-based Randstad, has floated a new venture in the HR industry. The entrepreneur, angel investor-turned-politician today announced his second venture in HR industry through a new company, CIEL HR Services. The company will provide HR solutions leveraging technology and analytical strenghths and it will be based in Bengalaru.
He will be the chairman of the company, while his wife Latha Rajan will be the director and co-founder. The other founding team members include Aditya Narayan Mishra as director & CEO, Santosh Nair as director & COO. The couple hold around 80 per cent stake in the company, while Mishra and Nair holds the rest of the shares in the company, which has a capital of around Rs 3 crore. Rajan added that this time, he would not dilute the promoter stake to a minority shareholding and would look at an Initial Public Offering (IPO).
The Group will have two companies, CIEL HR Services for HR solutions and CIEL IT Solutions to address the IT requirements. CIEL is French for 'sky'. The Group expects the turnover of the new business would be at around Rs 10 crore by end this year and it would reach around Rs 1,000 crore in 8-10 years, a considerably lesser time Pandiarajan's earlier business took to achieve the same. The HR firm would be focusing on technology, banking, financial services and insurance sector and consumer, retail and other services for its business.
While announcing the re-entry into HR services, Rajan said CIEL will use the power of analytics to provide solutions for HR industry. The company will be leveraging its new analytics framework to increase the conversion rate into recruitment by mapping the context of the requirement and matching it with the most suitable candidates using big data. It is also planning to launch a platform in next two months, where the companies and the prospective candidates can find each other.
All the offerings in staffing, search and selection will be driven by data-based insights using new sciences to find the best talent.
The company started the operations in four cities including Bengalaru, Chennai, Mumbai, Baroda and will soon create offices in Hyderabad, Delhi, Kolkata and Pune. The company is also looking at bidding for public private partnership projects for the Central government's proposed overseas employment bureau to expand its operations to overseas countries.
Ma Foi Group, after the sales of its stake in HR services to Randstad, has services under Ma Foi Strategic Consultants, Ma Foi Analytics and Business Services, Ma Foi Connecting Dots and Ma Foi Educational Services.
While Randstad has committed to transfer the name to him after three years, a duration which according to him ended on March 31, 2015, the former has said that according to their calculation, the three-year period is not over. "We are in discussion with Randstad on this. With my exit from that company, the brand Ma Foi is owned by them, which I have licensed out for the business now. They have committed to give it to us after three years and we are in discussions," he said.
Ma Foi Analytics and Business Services is looking to raise $3 million investment from venture capital firms and it is ready to dilute stake by up to 25 per cent, he said. The company is in talks with investors and a deal is expected in next two to three months. Besides, Varam Captial Pvt Ltd, a microfinance institution of the Group, is expected to raise Rs 20 crore from high networth individuals in near future, he said.
"We have over Rs 60 crore of disbursement at present and looking at raising some funds from HNIs. We may go for a bigger round later to raise funds from venture capital industry later, probably when our disbursement would cross Rs 100 crore," said Latha Pandiarajan, managing director of Varam. The MFI is looking at expading its presence to the western part of the country with an office in Maharashtra.
Rajan was the founder of Ma Foi Management consultant Ltd, which pioneered the concept of organised HR services segment in India. The company had presence in 14 countries and placement record of over 2.5 lakh candidates. He established Ma Foi as the first Rs 1,000-crore company in the Indian HR services industry, with a growth rate of 66 per cent over first 16 years.
In 2004 Netherland-based Vedior acquired majority stake in Ma Foi, when the company was valued at around Rs 70-80 crore. Later in 2008 Randstad announced its global acquisition of Vedior, which resulted in merger of Ma Foi with Randstad and the company was renamed as Ma Foi Randstad.
After the global merger in 2012, Rajan moved out of Randstad, and started consulting and analytics' business units under Ma Foi Group.