New Economy: Mindtree: The New e-strategist

NEW ECONOMY
Mindtree: The New e-strategist

Barely a year old, the Net-only consultancy is fast making its mark in a world dominated by cutting-edge American competitors.

By Dilip Maitra

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On the second floor of the chic four-storied headquarters of MindTree Consulting in Bangalore, there are two 'Monk Rooms'. Dimly lit, bare and soundproof, these are the pit stops where the Net consulting company's brainiacs come to whenever their turbo-charged minds overheat.

As a new breed of rapidly growing, Web-only consultant, Mind Tree-promoted by ex-Wipro executive Ashok Soota, and nine others-has every reason to indulge its geeks-turned-e-strategists. For, what the year-old company does is no low-brow Net job. As one of India's few pure play e-consultancies, MindTree is right on top of the New Economy foodchain. Says Soota, 58, Chairman and CEO: ''As most of us already had vast experience in the industry, we decided to pitch ourselves on top of the Net services pyramid.''

One-stop e-shop

Soota's stratagem is working. Kicked off with a seed capital of Rs 40 crore-a third of which came from veecees Walden International and Global Technology Ventures-MindTree has roped in 27 clients, 19 of whom are US-based. Being on top of the value chain helps. In an undot.com-like feat, MindTree has already turned profitable. So much so that the second round of funding set for December, 2000, has been put off.

By the end of first full fiscal in 2001, revenues are expected to rack up to Rs 70 crore; and by 2005, $123 million (Rs 565 crore). Notes Sridhar Mitta, 53, another Wipro-ite, who now runs his own set up, e4e Labs: ''It shouldn't be a tall order. The rates and margins here are four times the usual software solutions business.'' According to International Data Corp., American corporations will be pouring $80 billion a year into Net services by 2003. A large chunk of the moolah will likely be gobbled up by the likes of MindTree.

If the upstart is winning clients in the US-despite stiff competition from rivals like Cambridge Technology, Sapient, Scient, and Viant-it is because of its focus on complete b2b and b2c solutions. Broadly, the company has two practices: e-Business and network technology. The former includes concept to implementation skills, including strategy, e-business architecture, customer management systems, and web-site maintenance.

The technology practice, on the other hand, focuses on data communication and wireless design engineering, chip design, network management, and embedded software. Then, there are two more services this division provides, including what kind of a product its client should be offering, system-level design, and continuous engineering support.

On the cutting edge

In integrating its processes into four modules-survey, define, design, and implement-MindTree breaks down barriers associated with the traditional consulting approach, where each one of these competencies have to be sourced separately. Says Subroto Bagchi, 43, VC and COO, MindTree, and who comes from Lucent Technologies: ''We deliver solutions nearly 30-40 per cent faster than our competition, and we are 40-50 per cent more cost-effective.''

In India, the company's customers include Hindustan Lever, Fabmart, Business Standard, and Franklin Templeton, among others. In contrast to the typical software company, almost a quarter of MindTree's revenue comes from domestic clients. Says Soota: ''A large number of Indian companies need world-class software solutions for their e-business, and that's a valuable niche for MindTree.''

To ensure that it stays on the cutting edge of technology, MindTree has tied up with leading software companies such as Ariba, ATG, and Vignette. It also has set up MindTree Labs to work on futuristic technologies that will help sharpen its competitive edge. Explains S. Janakiraman, 42, President, MindTree: ''The company's goal is to enable its customers to realise their product in the Net time-space in a better technological and cost-effective manner.''

Janakiraman isn't bragging. In network technology, for instance, nine out of its ten customers are demanding American companies like Mira Point and Alopa. It also offers network management consultancy to top vendors like Cisco Systems, Amber Networks, and Atoga Systems. Points out V.S. Sudhakar, 41, CEO of Fabmart: ''MindTree has shown a clear aptitude to be a dynamic learner, and that is its key differentiator.''

The least of all the reasons for MindTree's impressive customer endorsements is not its ten founders. All of them come with impeccable professional track records (See MindTree's Other Eight).

Nurturing the tree

In an industry where skills are in short supply and poaching rampant, Soota is trying to build a company that its employees would not want to leave. Offering stock options to all employees is just one part of the deal. More importantly, in Soota's worldview, MindTree is to be a value-based company. The name 'MindTree'-identified by a US name search company-is meant to convey the commitment of the management to give the best of its knowledge and capability to its customers.

The company logo, designed by a 15-year-old spastic in Bangalore, was chosen for a specific reason. The blue brush stroke stands for imagination, the bright red base for action, and the sparkling yellow bubbles, joy. Every MindTree member, then, is expected to live by this 'DNA' of imagination, action, and joy.

With a philosophy like that, making MindTree bear rich fruits shouldn't be a problem.

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