Infosys co-founders' stake sale: A painful parting if it happens, but they have a lot to cherish and celebrate

It must be difficult being N R Narayana Murthy -- but there is another side to the story.

The founder of software giant Infosys, whose campus former prime minister Atal Behari Vajpayee once compared to the Taj Mahal for its tendency to be on the agenda of VIP visitors from abroad, has denied reports that he and other key co-founders are set to sell their stakes at a collective valuation that could touch Rs 28,000 crore, but even if he does, it should not surprise observers after the events of the past four years in the company.

The fact is that after Murthy returned as executive chairman to nourish the company back to health in difficult times, he has at best been listened to politely and at worst been criticised for his intrusions -- in a house that he built from scratch. But shareholder capitalism is merciless: They who control the stakes calls the shots. Therefore, of what use is a minority stake in which moral suasions and boardroom battles are all you have got when a new chief executive officer (CEO) and a diverse set of institutional shareholders march to different beats?

Events over the past two years, especially the past few months, show that Vishal Sikka, the CEO with a mind of his own and board support to match, has diverging opinions on how to run the company. Murthy has already let go of the title of Chairman Emeritus earlier conferred upon him. In the current state of play, he wields less influence over Infosys than the president of India wields over an elected government.

Narayana Murthy, co-founder, Infosys. AFP.

Narayana Murthy, co-founder, Infosys. AFP.

Like a traditional Indian father handing over his daughter to a son-in-law, Murthy has done his bit to keep the shine on the latter-day Taj Mahal he has founded. What is the point in being in in a company where your views are no longer gospel but just "inputs" for a bunch of directors long on management concepts and short on sentiment? He might as well be cheering his Tory son-in-law Rishi Sunak in this week's British elections -- and that is precisely what he is doing.

The other co-founders must feel much the same as Murthy, albeit in lesser degrees. Nandan Nilekani, in hindsight, is likely to be viewed by future historians more as the initiator of the Aadhar identity number that dramatically reformed governance in India than as the shining CEO of a path-breaking software company.

However, as Infosys moves to a new era, there is plenty to celebrate for its founders. Having started a leading symbol of resurgent India, there is a lot they can look forward to in the present and the future. Quietly, Murthy's Catamaran Ventures  -- effectively run by his bright son Rohan -- has emerged as a successful investment vehicle. Hector Beverages, the soft drink venture that offers traditional Indian drinks under a millennial brand called Paper Boat, and Cloudtail India, its online retail merchant joint venture with Amazon, are already much-talked-about stories.

Co-founders SD Shibulal and Kris Gopalakrishnan are busy meanwhile, putting slices of their fortunes into into everything from trendy restaurants to brain science research and incubating new age startups in their venture, Axilor.

More importantly, a whole lot of new age areas beckon rich moneybags who also have management and scientific knowledge. From data science to virtual reality, from renewable energy to robotics, there are many fish in the startup sea for investors with seasoned minds. Why should/would they be playing third fiddle in an orchestra they used to conduct once?

(The author is a senior journalist. He tweets as @madversity)


Published Date: Jun 09, 2017 11:36 am | Updated Date: Jun 09, 2017 11:36 am


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