Dr Velumani Arokiaswamy, an Indian farmer’s son is now worth more than $300 million after his health care firm’s IPO.
Velumani was born in 1959 to a landless farmer in a tiny village 26 km from Coimbatore. Unable to cope with adverse circumstances for what appeared to be an endless period of time, Velumani’s father had given up taking care of his family, which included four children, early in life.
Faced with her husband’s helplessness, Velumani’s mother took on the responsibility of keeping their head above water by investing in two buffaloes.
The money from the milk — Rs 50 a week — was what sustained the family for almost 10 years.
To attend college, Velumani had to leave the village. His motivation to enroll in college was unusual: To get a ‘fair-skinned wife’. “In those days in our village, only boys who were graduates could hope to marry a fair girl,” he says.
Aged 19, Velumani got his BSc degree and started looking for a job, but could not find one in Coimbatore.
For one, prospective employers seemed keener on one’s facility with the English language than one’s knowledge, and Velumani’s grasp of English was not — and still isn’t — something to write home about.
Two, almost everyone who interviewed him wanted to know what experience he had. As a fresher straight out of college, he had none.
The matter irked him to such an extent that today he employs only freshers in his company that has 700-odd people.
After months of looking, he finally landed a job at a capsule-making factory as a chemist on a salary of Rs 150 a month. “Graduates in Tamil Nadu then were paid less than watchmen,” he says.
He used to keep Rs 50 for himself and send Rs 100 home to his parents, who needed the money to educate his siblings.
“In some ways, I had become a father at the age of 10 when I realised that my father could not bear the burden (of the family),” he says.
“And it is to my mind the hallmark of a good son even today — to live frugally and send 60 per cent of his earnings to his parents.” I interrupt to add that I will let my son know.
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After working at the company for four years, Velumani could see that his life wasn’t going anywhere.
Neither was his company. A month before its imminent closure, Velumani resigned and applied for a job at the Bhabha Atomic Research Centre in Mumbai.
He borrowed the money to go for the interview and landed the job at a princely sum of Rs 880 a month.
A government job was to his mind like eight hours of rest every day.
Air conditioned offices, comfortable chairs, a clean working environment — he couldn’t quite call it work at any stage, even though he put in long hours.
So, to supplement his income, he started giving four tuitions a day, earning another Rs 800.
Of the Rs 1,680 he made, he sent Rs 1,200 a month home, which was crucial too as he had told a lie — a white lie — to his mother that he was drawing a salary of Rs 2,000 a month.
“If I didn’t send at least Rs 1,200, she’d say her son was ruined for life. I knew she wouldn’t let me leave the village for a salary of Rs 800,” he says.
At 27, Velumani’s to be father-in-law approached him to marry his daughter – a girl working in the State Bank of India for a salary of Rs 1600 a month.
Velumani took one look at the girl and was not too keen to marry her – she had darker skin than his. Yet he didn’t want to reject her outright either so he agreed to meet her. “Very difficult to tell an old man your daughter is not up to the mark”.
I interject at this point; this fair skin nonsense is getting to me. I ask what is fair and what is dark ? Is he dark, am I dark or fair. “I am kind of the cut off” he says. He’s marginally darker than me so I suppose I am fair – for whatever its worth.
Ridiculous to my mind but I keep my thoughts to myself. He too sees the stupidity of this line of thinking but it is a reality he’s lived with and many continue to live with.
At the first meeting at her office in SBI, he falsely portrayed all his “assets” as liabilities to dissuade her from agreeing to the match. “I cooked up stuff hoping she would reject me and tell her father this boy is not worth marrying”. He says he spoke continuously for 55 minutes and she listened quietly without saying a word.
But at night, the father called to say that this daughter had agreed to the match. When later he asked her why she agreed – despite him de-selling himself – she said she “knew he was exaggerating” and that “bade ghar me mai choti ban jaungi lekin chote ghar me mai badi reh sakti hoon” (If she marries into a family much above their status, she would be looked down upon; since his family didn’t have that kind of status, her position would remain intact and strong).
“In life one has two options. One is debt and one is equity. Debt is safe but equity can give enormous infinite return but is riskier. My wife chose equity and I respected her for that. She knew I was equity.”
I ask how he thinks she knew he’d be equity. “Otherwise why should she marry a poor man. Somewhere she felt I’d deliver”, he adds. He was poor, not much better off than her own people and she didn’t know him either (it wasn’t a love marriage). It was a hell of a gamble to take.
On his part, she won – despite her colour – since she had managed to keep silent for almost one hour (something he thinks women can’t usually manage) followed by her simple logic of her position in the family. He agreed to marry the dark but sensible girl.
He presented his mother with fait accompli, aware that she would never accept such a dark skinned girl.
After marriage, Velumani started doing his PhD in thyroid biochemistry (by then his daughter, the second child was born). It took him ten years.
Meanwhile, his two brothers were also brought across to Mumbai for higher studies – at the instigation of his wife. “The entire credit for making the family what it became goes to my wife”. Today, one of his brothers is the CFO of his company.
“In some ways, my HR was managed by my wife from 1986…my human resources”, says he. When she took care of his family, she left him free to take care of his education and then business.
Velumani had been working for 15 years tirelessly at his non-tiring government job but a kind of restlessness had begun to set in. He was watching those who had learnt how to do thyroid testing minting money all around him while he continued to struggle on a government salary. He thought to himself, if I have taught this to so many for ten years, why can’t I mint more money.
In 1995 – without consulting anyone including his wife – he resigned. At 2 a.m. one night, he broke the news to her. She didn’t react and then said “what if I also resign from my job”.
“It came literally like a dhamki (threat). So I said “jiyenge saath, marenge saath”. The next morning onwards, she stopped going to office. She quit SBI after 16 years.
He had decided that he wanted to use his expertise in thyroid biochemistry to set up testing labs to detect thyroid disorders.
With the Rs100,000 ($1,500) that he collected through his provident fund, Velumani set up shop in Byculla, a middle-class neighbourhood in South Mumbai, which is a short distance from the Tata Memorial Hospital, a prominent cancer institute. He was 37-years-old then.
With an eye on the huge potential for thyroid testing, Velumani started out with a franchise model where samples would be collected across the country and sent back to the central laboratory in Mumbai. Procuring samples, according to Velumani, was the toughest part since they had to come from different corners of the country, while processing them was much easier.
Thyrocare’s success in the past two decades had also brought it closer to India’s private equity players.
In 2011, New Delhi-based CX Partners picked up a 30% stake in Thyrocare for Rs188 crore ($28 million), valuing the company at about Rs600 crore ($100 million). Since then, other investors, including Samara Capital, Norwest Venture Partners, and ICICI Bank’s Emerging India Fund, have bought into the company.
In fact, the recently concluded IPO—which saw Thyrocare’s shares being oversubscribed 73 times—was to provide an exit route for the existing investors.
“Our success is mostly due to two reasons,” explained Velumani. “One, in the last 20 years, we have never taken on debt. Second, over the last ten years, we have always kept Rs60 crore ($9 million) aside in cash.”
His mother died a year ago – it was before the IPO but she knew her son was now the richest man in the district. “Beyond the district, she understands nothing. So one day she asked me if I was richer than the richest man in the district and I said yes”. For her, the matter was over.
His father – still alive at 87 – does not know how “tall” his son has become. “He doesn’t know or understand beyond Rs 1 or say Rs 10 lakh. After that, it’s all the same to him”, he explains.
Once – some years ago – Velumani told his son who was not focusing enough on his studies that he was worried about him. He said that his own grandfather was a very rich man and because of that his father became a very poor man. Now he – Velumani himself – is very rich so he is worried for his son.
Proving that he is his father’s son, the boy replied that he was very happy – because it meant that his son (Velumani’s grandson) would be very rich.
Now 27, Velumani’s son (an Mtech in biotechnology) and his daughter (now 25)- both unmarried and missing their mother “like anything” – live in the laboratory with their father. As biochemists, both are trained and ready to step into their father’s shoes at some stage, gradually learning the ropes of the business. Of course the fact that they all live inside the laboratory helps! What better way to learn the business than to live inside it ?
Why on earth does he live inside the laboratory, I ask. This is beyond strange – and probably smelly – to my conventional mind.
Why not, he says. He has 100,000 square feet so he’s kept aside 5000 square feet to live in. However, even when his laboratory was just 500 square feet, his wife and he lived inside it.
Even his wife was okay with this, I ask. “She lived in it by choice not compulsion. She was a mother to each and every employee. She knows everyone’s name, middle name and surname so to speak”, he adds, again bringing home the huge void she has left.
His children are frugal in their spending and approach to life. Does he then think they will achieve or amplify what he has built ? His daughter says he had an advantage – “the luxury of poverty” but he thinks the values instilled by him and his wife will hold them in good stead – no matter what.
Frugality is the cornerstone of both his life and Thyrocare. Thyrocare offers thyroid tests to patients through its distributors at a fraction of the cost of competitors and has resulted in the prices of testing coming down in the country. He calls the company “McDonald plus Walmart”. Mcdonald for its focused menu and Walmart for its volumes.
He’s never borrowed a penny – neither personally nor for the business. “The problem with business and businessmen is that you start spending the money even before you earn it”. It’s something he figured out quite early in life. You cannot spend what you haven’t earned.
“And she was also frugal. I don’t think she consumed 0.1% of what she was entitled to”, coming back to his wife as our conversation winds down. He says if the surgeon had come out of the operating theater and said “Mr Velumani, I need Rs 1000 crore immediately, I would have signed without a thought.” But he only came out and declared she is no more.