Good morning sir. Once again we are very thankful to have you here and we welcome you on behalf of Hult Prize Xavier's College Autonomous Kolkata. Before we begin we'd like to give you an introduction on what Hult Prize does and a little bit about our magazine, The Extraordinaire, for which we are conducting this interview. Hult Prize is a global youth initiative often referred to as the Nobel Prize for students that inspires young people across the world to use businesses as a force for good. Acting as a marketplace for ideas with the best idea receiving $1 million in seed funding, our mission is to empower student entrepreneurs to design creative and sustainable solutions for society's most urgent challenges tackling issues like poverty, education, climate action, and healthcare. In our campus chapter, our annual magazine, The Extraordinaire, now in its third edition, aims to celebrate ideas that can change the world one page at a time. Our previous editions have featured respected and influential voices such as Harsh Goenka, Shiv Nadar, Chitra Banerjee, Deva Karunakaran, Ambassador Shyam Saran, Nandan Nilekani, D.V. Patnaik, and Oberoi among many others. We're humbled to share our efforts but also recognized globally when our team received the On-Campus World Program Award in 2024 from the Hult Prize Foundation in London. Before we begin, we just like to explain the format of the interview. It will be a question and answer session and we already have sent you a curated set of questions which we have selected some. We have 10 questions and if everything's good to go, we can begin sir.
Yeah. Yeah. Yeah. I'm ready.
Okay. So, the first question is you have often described your ideology as being one of compassionate capitalism. How do you reconcile the ideas of capitalism which are most often profit sensitive with something like compassion? Does this imply a society where social good depends on charitable impulses of large corporations?
Well, I think that's a very good question, very well thought-out question. First of all, let us understand what is capitalism. Capitalism is about unleashing the power of human enterprise in an environment of free markets. Capitalism also means less government intervention. The government not operating as a player, government operating purely as a regulator, fair regulator, fair, impartial, data and fact-based regulator. It does not mean that capitalism is against the poor. Even though Milton Friedman, whom you have all studied, one of the anchor persons of pure market-driven economic growth philosophy, did say that at the end of the day the task of a corporation is to maximize its profitability while being fair to its stakeholders, customers, employees, investors, vendor partners, government of the land and the society. Now we must understand that in a poor country like India where there is so much of poverty around us, it is very very important for the leaders of capitalism, the evangelists of capitalism, to make capitalism an acceptable philosophy for the masses because by and large India is a very very very poor country with a per capita GDP of $2,818 and in that about 800 million people receiving free ration. In addition many state governments have started giving free electricity, free bus transport etc. This is a very poor environment. Therefore, there's a lot of skepticism amongst the vast majority of people about the wealthy, about the rich and about the corporate leaders. Therefore, for us to make capitalism acceptable to the poorest, we have to demonstrate to them that capitalism is not just for the rich to become richer, but it is for the poorest to seek opportunity to overcome poverty, to escape poverty. Number two, the rich corporate leaders must go out of their way to demonstrate that they have concern for the poor in the society. How do they do that? They contribute, of course, their taxes legally and ethically. They do not pollute the rivers. They do not pollute the air. They pay fair wages to the employees. They contribute a part of their profits to corporate social responsibility and they will keep the society as an important stakeholder and they will also lead a life, they will eschew a life of vulgar richness. They will lead a life that even the poorest people in some way can relate to. That is what is called compassionate capitalism. And that is I coined this word in 1975 when none of you was born. Compassionate capitalism combines the best of capitalism with the desirable aspects of socialism and liberalism. Let me stop it.
Thank you sir for that answer. You mentioned that you know corporations have to keep society as a stakeholder and that's exactly what Hult seeks to do by you know keeping society and its well-being as one of the major stakeholders in our business enterprises. With that we'll move on to the next question which is in the present scenario several companies have emerged in the IT industry. So what do you think makes the 44 year old Infosys stand apart even today?
Well, when I founded the company in 1981 I assembled six younger colleagues of mine who were very young. They had just started their career in my small apartment, one-bedroom apartment in Mumbai and we started discussing what should be our vision, what should be our objective. One fellow said we must become the company with the largest revenue in IT. Another fellow said we must be the most profitable software company. A third fellow said we must be the company with the highest market capitalization in the country. And my style was to allow younger people to give their views and finally come in. I said why don't we say that we want to be the most respected company in India. Why? Because if you try to earn respect from your customers, you will ensure that you will not short change your customers. You will ensure that you exceed their expectations of our performance. You will ensure that the quality of what we deliver is better than what they expected. Therefore, more and more customers will automatically come to you and more and more revenues will come. Second, if you earn respect from your employees, those employees will talk to their cohorts and talk about the goodness of this company and that will help us to attract best talent to the company. If you seek respect from investors, you will have to follow the finest principles of corporate governance. Every decision of yours has to be based on fairness, transparency and accountability to every stakeholder and that will bring in long-term investors. If you seek respect from your vendor partners, they will stand by you in your hour of difficulty. For any reason you are not able to pay them on time, if you explain to them, give them all the data, they will understand. Yes, we do have gone through this. Therefore, let us cooperate with these people. If you earn or if you try and earn respect from the government of the land, the government will set policies that will help you grow. The most important stakeholder is the society. Therefore, if you try to earn respect from the society, then you will automatically get respect from all other stakeholders because society contributes customers. Society contributes employees. Society contributes investors. Society contributes vendor partners. Society contributes bureaucrats. And society contributes politicians. Therefore, the most important stakeholder for any corporation is the society. And if you seek respect from the society, you will seek respect from all the stakeholders and automatically good employees will join you. Long-term investors will be there. You will get more and more business from customers. Your revenues will go up, your profits will go up. Therefore, your market capitalization will go up. That is how I argued with my people and they all agreed. So, we have conducted ourselves in a way that in every decision that we took, we asked will this decision enhance respect for the company and respect for the management, respect for the board of directors if we took this decision. That's the key decision we took and that is what is unique about Infosys.
Thank you sir for that very enlightening answer. For our next question is what is the one milestone that made you truly believe that you've made it in your professional journey and along with that how do you stay intellectually curious and grounded even after achieving so much?
Well, there have been many events that have brought lot of joy and happiness to me. For example, the day one of our fans invited me to the gruhapravesham of his house, of his two-bedroom house that he had bought in a very good locality in Bangalore based on the employee stock option plan. That was the day I felt very proud of Infosys because Infosys was the first company in the history of India that made it possible for a peon to buy, to build a two-bedroom excellent flat or house whatever. Similarly, when Infosys was declared the best managed company, when it was a very small company, hardly about $100 million of revenue compared to huge companies in the country. We were declared by Economic Times as the best company of the year in 1998 if I'm not wrong. That was a very happy day. So I can go on and on but definitely the day where I felt very proud of Infosys was when I sat on that high stool in Manhattan at the NASDAQ headquarters when we were listing Infosys on NASDAQ. We were the first Indian company to be listed on an American stock exchange. And I borrowed the words of Neil Armstrong and I said it is a small step for NASDAQ but a giant leap for Infosys and India. Therefore bringing an Indian company onto the world's most famous stock exchange for high-tech companies that is NASDAQ was an event that indeed made me very happy.
Thank you sir for sharing with us those moments. They're very inspiring to us as young professionals who have just started out. Our next question is you have led Infosys through multiple global downturns from the dotcom bust to 2008 crisis. How do you as a leader remain calm when everyone else is in panic mode?
You know, I learned from my mother a very important principle. When there is a crisis, the leader should not panic. Leader should be calm. The leader should think of what action he or she should take quickly. For example, if in a house one of the children is pretty sick, if the father and the mother start panicking, the other child or other children in the house will be extremely distraught. They would lose hope. They would lose confidence. Therefore, that is the time when the father and the mother will have to provide confidence and hope to the members of the family particularly the children. Similarly, in a company, it is the responsibility of the leader to bring in a sense of hope and confidence and that everything will be all right if we continue our work, if we continue to work hard, if we continue to be disciplined, if we continue to have high aspirations when the situation is tough. So that is how I have tried my best never ever to get upset when there is a crisis.
So for your words about perseverance, our next question is in today's startup ecosystem what do you think is the most important having a unique vision, having the necessary capital or is it all about timing?
Well, there are two major requirements for an entrepreneur to succeed in today's highly competitive world. One, a differentiated business value coming from the idea that is the product or services of the entrepreneur compared to his or her competitors. That is tomorrow when you become an entrepreneur, you should say my idea provides you better value than all the competitors that sell to you. It brings better productivity. It brings better quality of entertainment. It provides better health to you quickly. In other words, a unique differentiated value proposition vis-a-vis your competitors. That's the first thing. See, most of us operate in bringing some kind of innovation to existing ideas. Very few people create discontinuity and invent. For example, the first computer was an invention. Mosaic, the first browser was an invention. Internet was an invention but very few such things happen in the history of the world. What happens is constant improvement of what exists today. So that the entrepreneur can obtain better market share by demonstrating to customers that his or her idea is providing better value per unit price to the customers compared to all other existing products. That is the first thing that is needed if an entrepreneur wants to succeed. Second, the entrepreneur must conduct an inexpensive market survey whether there is a market in his or her menu for his or her ideas. Let me give you a very simple example. Today there is a real-time blood sugar measuring patch called Freestyle Libre 3. Libre 1 was there, Libre 2 is there, now Libre 3 but that's not manufactured in India why because each patch costs approximately about $50 or about 4,000 rupees, 4,500 rupees and a patch works only for 14 days. In other words, in a month you'll need two such patches. How many Indians are there who can afford to put in 9,000 rupees a month for having a diabetes patch on their own so that they can measure their blood sugar in real time? Very few. So that product they have not yet manufactured in India because they've realized that that market doesn't exist. So similarly when I founded my first company called Softronics I found that there were very few computers in the country and those few computers were with the government. Third it was very difficult to work with the government to obtain software contracts. So I closed Softronics in a matter of 9 months because I realized there was not sufficient market for my idea. So the second thing you have to do is conduct an inexpensive study of the market so that you know that there is enough market or there are enough people with sufficient disposable income to buy your product or service. The third most important thing is talent. As an entrepreneur, as a leader, you have to attract competent talent and create a team that has mutually exclusive and collectively exhaustive set of skills, expertise, and experience. Competent and value-based talent is extremely important because there is nothing as critical for success of an entrepreneur as the power of human mind that he or she collects with him or her. So if you have these three and finally all the people that you collect must have an enduring value system. They must all be ready to make sacrifice in the short term in the hope that long-term will bring better prosperity. They must put the interest of the company ahead of individuals. They must not put their hand in the till when others are not looking at it. They must lead in austerity, hard work and discipline by example. So they must be honest, they must have integrity, they must be transparent, they must be accountable, they must be fair in every decision. So if you collect such people and ensure that all of you have an enduring value system, then you are likely to run your marathon for a long time. So first an idea with a differentiated business value to the customers. Second, an inexpensive market study to ensure that there is actually enough market for your idea in the country or in the world whatever it is. Third, a team which has the required complementary strengths and an enduring value system. If you get these three, money is not important. It will all come. Don't worry.
Thank you, sir, for that answer. Listening to you, we actually found a lot of similarities with what Hult Prize as a foundation seeks to do. In fact because you spoke of the diabetes patch we'd also like to let you know that the Hult Prize Foundation India's national winner actually had a startup which was based on medical technology and how they would be sustainably scanning breast cancer detection using deep learning. So of course as Indians our motive is not only for profit but as you said about being charitable and also making solutions that are novel to India and important for India. With that sir according to you the next question is what kind of policy shift is essential for India to become a 10 trillion economy?
You know I have traveled to about 80 countries, of them maybe about 45 developed countries about 35 developing countries. What I have found is that those countries where the bureaucrats and politicians do not interfere in the running of an enterprise are the ones that create prosperity and economic growth. So what is needed is to create a set of policies that will make the life of entrepreneurs easy. That will require the entrepreneurs to interact with the government as few times as possible. That will create systems that will help the bureaucracy take quick decisions to the requests of entrepreneurs. Create a system that will provide full transparency for where that decision is lying, how long it's lying, with whom, what is the reason etc to the entrepreneurs. In other words, we have to reduce bureaucratic delays. We have to reduce corruption. We have to make the life of the entrepreneur easier. We have to ensure that entrepreneurs spend 95% of their time in thinking of their enterprise, how to win better revenues, how to succeed in the market rather than waiting in the corridors of the government. I think if we succeed in those, I believe even we also have a chance of becoming a developed country.
So just to add on to like your answer how much do you think things have changed when it comes to this sort of interaction in the years since you've started Infosys like in the 1980s of course there was a very centralized system 1991 we had the liberalization policies do you think things have vastly changed are we going closer to this idea of reduced state control?
