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June 7, 1999
Hit Entrepreneur Now Wants To Wash Some Linen
Arthur J Pais in San Jose
The man who sold his three-year old firm to a Swedish company for $ 450 million says he will now help his wife by doing laundry at least for a year.
Former Bell Labs scientist Hemant Kanakia, whose Torrent Networks in Maryland was bought by Ericsson last month, was joking when a fellow IITian asked him what he would be doing now.
Kanakia, who now shepherds Torrent for Ericsson, says he would love to start another company in a couple of years. Meanwhile, he and wife Sonal Desai did some public laundering here last month at a gathering of IITians.
Before Kanakia and Desai spoke to the group, only a few people, including their friend and Kanakia's partner Raj Mashruwala, knew about the odds Kanakia had faced in starting the firm.
"Hemant had all the right ideas but some of the people in the Silicon Valley thought he was in the wrong place," says Mashruwala, adding that Kanakia would have been able to raise the seed money faster had he moved from College Park in Maryland to the Valley in California. Torrent was started with a $ 5 million investment from Silicon Valley investors.
"The guys over here said they could raise a few millions in a few months if he would relocate but Hemant would not, just would not contemplate moving out of Maryland."
Mashruwala knew in his heart that Kanakia had the ingredients to make his venture a big success on the East Coast and helped raise the money for Torrent Networks within a year.
The reason why Kanakia would not move to the West had everything to do with his wife, Sonal Desai, a tenured professor of sociology at the University of Maryland.
The unusually reticent Kanakia does not talk much about his family, but Mashruwala says Kanakia was so concerned that Desai's academic work should not be disturbed, he was prepared to wait longer to get the funding.
Last month, Desai and Kanakia were invited by IITians to share lessons from their partnership.
"They are role models to us all," said Mashruwala, one of the leaders of the alumni association, whose members are leaders at many top firms. Many of these men and women are helping fund building activities at IIT-Bombay. Kanwal Rekhi, president of The Indus Enterprise, has donated $ 2 million. Mashruwala says the target is to raise $ 10 million in the next few years. Like other IIT alumni, Kanakia has been a guest lecturer at his alma mater.
But for a change, he was offering insights into starting a business, and his wife was talking about how her life was challenged when Torrent was launched.
"One of the things I would remind anyone who is starting a business is to remember right at the beginning that you will need much more time for the venture than you can possibly think," says Desai with a chuckle. "You better let your spouse know about it."
Desai and Kanakia have doctorates from Stanford University. The two had lived away from each other for several years when she pursued her academic goals and he toiled at Bell Labs. With their children getting to be teenagers, they did not want to live apart again.
Kanakia describes himself as down to earth. In reminding fellow IIT graduates of the red tape and obstacles even at major corporations, he recalled how many of his ideas at Bell Labs did not make it into the real world.
When he was ready to start a company to produce sophisticated gigabit routers, he came down to Silicon Valley to talk to would-be investors. He was refreshingly candid about himself. He described himself as a technologist, and sought the help of managers who would guide his venture.
"At Bell Labs, he worked in a protected environment for a giant company," says Mashruwala. "Now as an entrepreneur with a start up company, he had to produce results faster. The pressure was much more."
Kanakia's approach was unique in that "he was clear about what he was not clear about" and he was forthright about it with his investors, says Mashruwala. Among the major investors in the $ 5 million venture were Draper Fisher and Columbia Capital.
Though Kanakia initially thought that getting the money would be tough because he did not want to move from Maryland, he soon found out that running the business was even tougher. He had to overcome many challenges in executing the plans presented to the investors before he would go for a second round of financing of $ 18 m. Though he had never been a CEO, he learned the art of management naturally.
"In my business-oriented family in Bombay, I was something like a black sheep for many years," he had recalled in another interview. "They were disappointed in me when I went to study at IIT and when I got into a Ph D program, I became even a bigger black sheep. So when I started Torrent, I told myself I had to prove to them that I could be a good businessman too."
Building a company is a very family-oriented process, he told fellow IIT-itans. "One has to nurture its development like you would while raising a family," he said.
Sonal Desai remembered a chat she had with "Mashru" many months before Torrent was launched. Mashruwala had asked her if she was prepared for the "start-up" lifestyle. He told her her lifestyle and family situation was going to change radically.
Having known IITians for more than two decades, she thought this was another example of an IITian giving an exaggerated picture because they set their sights very high.
Moreover, she had heard from her sociologist colleagues that Americans overestimate the hours they put into work. Sure, she at that time was putting 13 hours of work a day but that included commuting time as well. So she thought Kanakia would put in not more than 10 to 12 hours a day, hoping that he would continue helping her in all the household chores that they always shared -- and on certain days he would pick up the children from school.
It certainly did turn out that way. On starting Torrent Networks, her husband gave up on household chores early on. Planning for child-care, vacations and attending conferences even a year in advance was impossible.
"Who would have predicted that on the day I was to chair a conference I had been planning for a year, Hemant would be unavailable because he was negotiating the sale of his company to Ericsson?" Sonal Desai asked.
Earlier, she had recalled that when she realized that it was not possible to have a joint vacation, she decided to take a break, and traveled with her children. "We had to be utterly realistic," she said.
Reminding the gathering that a marriage is a long-term contract in which adjustments had to be made constantly, she said she used inspiration from her physician mother who juggled her own career with family responsibilities.
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