VG Siddhartha's suicide and perils of entrepreneurship: CCD founder among biz leaders who fell prey to high-pressure job
To the outside world, things weren't as bad for VG Siddhartha, founder of India's largest Coffee chain Cafe Coffee Day. But beneath the surface, there were signs of distress.
Businessman VG Siddhartha's suicide, just as he faced an imminent Income Tax Department probe regarding his sale of shares in an IT firm Mindtree, points to the fragile world the wealthiest of individuals live in
The inherent need to stay on top of their game, despite the high risks involved, makes the top job extremely high pressure, and sometimes perilous
To the outside world, things weren't as bad for the founder of India's largest Coffee chain Cafe Coffee Day
But beneath the surface, there were signs of distress
VG Siddhartha's suicide, just as he faced income tax overdue regarding the sale of shares in an IT firm Mindtree, points to the fragile world the wealthiest of individuals live in. The inherent need to stay on top of their game, despite the high risks involved, makes the job extremely high pressure, and sometimes perilous. Entrepreneurship and leadership, turns out, has a psychological cost.
To the outside world, things weren't as bad for the founder of India's largest coffee chain Cafe Coffee Day. His net worth was arguably more than the debts and tax overdues the business tycoon was struggling to repay. But beneath the surface, there were signs of distress. Siddhartha had reportedly been selling assets to cut down debt and cover potential tax liabilities.
It was Siddhartha who tipped Mindtree Limited into a bitter acquisition battle after the coffee giant sold his 21 percent stake in the Bengaluru-based IT firm to infrastructure major Larsen and Toubro (L&T).
L&T bought the stakes from Siddhartha to gain a minimum 51 percent in Mindtree, which would give the infrastructure giant control over the IT firm at a time when other Mindtree promoters and founding members were staunchly against the deal. News reports said he was to earn a profit of close to Rs 2,858 crores from the sale of all his stake in Mindtree to L&T. However, the Income Tax Department attached a portion of shares held by him in Mindtree over a potential tax demand. The attachment also "prohibited for transfer or charge" of 22.2 lakh equity shares of Coffee Day Enterprises Ltd, and 52.7 lakh shares held by Siddhartha.
Furthermore, CCD was also in talks with soft drink giant Coca Cola to gain equity by sale of shares, although he intended to keep the controlling stakes with himself. The deal, which was still in the negotiation phase, was mostly under the wraps. But police sources, News18 reported, said that Siddhartha took the extreme step after speaking to his company's Chief Financial Officer for 56 seconds. That was his last known call.
But this isn't just Siddhartha's story. In an environment where tales of companies bootstrapping their way to success in acute circumstances are romanticised, and where CEOs sometimes take pride in their extreme work environments, there are several stories where hugely successful entrepreneurs succumbed to the high pressure jobs in the struggle to stay afloat.
Aaron Swartz, co-founder of Reddit
Swartz was a hotshot American computer programmer, who went on to set up the technology giant Reddit. He was 26 years old when he hanged himself in his apartment in Brooklyn on 11 January 2013. He moved towards political activism once Reddit was sold to Conde Nast but he got into a ruthless legal process after he was indicted on multiple felony counts for downloading several million articles from the academic database jstor. It is not clear why he did this, whether he wanted to upload it to the web as a free access document, or whether he himself wanted to analyse those. But as The New Yorker puts it, he certainly did not foresee the severity of the legal process that ensued.
Jody Sherman, founder of online marketplace Ecomom
Jody Sherman (47), founder of the online marketplace Ecomom shot himself in January 2013, after his company was forced to close its doors, after it burned up the multi-million fund the 28-person company had raised. Just six months before filing for bankruptcy, Sherman's company had raised $5 million as funds, and $12 million in total. Sherman left no note to explain his actions but a report in The Business Insider said that the company's collapse was credited to Sherman's lack of financial knowledge and the company's "aggressive discount culture."
Akanksha Rathi, director Rathi TMT
Rathi, a 32-year-old industrialist who helmed Rathi TMT in Indore and Madhya Pradesh committed suicide at her parent's house in southwest Delhi's Dwarka on 23 October 2o12. Akanksha's family said she took her life because she was not able to deal with the trauma of her husband's death in September the same year. Rathi's husband, Anirudh had died of a cardiac arrest reportedly because he was under stress due to some family issues. She was found hanging from the ceiling at house no. D-504 in Sansad Vihar, Sector-23, Dwarka on 23 October.
In August 2008, Foster, a 50-year-old British businessman shot his wife, Jill and their 15-year-old daughter, Kirstie, in the head. He shot the horses and the dogs he kept at his Maesbrook mansion, and he jammed a horsebox against the gate and shot out the tyres, perhaps to stop anyone from stopping him from destroying everything he once owned and built, including his family. He then flooded the mansion with oil, set everything on fire, and then shot himself. Foster came into sudden wealth after he discovered a chemical formula, which he called Ulvashield. "It won an apparently fantastically rare A1 fire-test rating. Where other oil rig insulations burst into flames, UlvaShield just formed a safe, crisp shell. The big oil companies began placing orders," The Guardian reported. However, the report said that by 2005 his liabilities were £2.8m higher than his assets, presumably because he'd overspent so luxuries such as expensive cars, mansions and membership to various fancy clay pigeon shooting clubs, all the time living on credit.
Germany's fifth richest man and the world's 98th richest person, Merckle killed himself by jumping in front of a train in January 2009. His family said he took the extreme step because he had been "broken" by the financial crisis. "The desperate situation of his companies caused by the financial crisis and the uncertainties of the last few weeks along with his powerlessness to act, broke the passionate family entrepreneur and he ended his life," a statement by the family said.
Merckle miscalculated the risk when he put all his eggs in Volkswagen's basket. The Guardian reported that he made "wrong-way bets on shares in Volkswagen" losing hundreds of millions of euros, including €400m (£200m) on Volkswagen shares alone.
In his suicide note, the 74-year-old apologised to his family but didn't give any concrete reason behind ending his life.
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