This Businessman Created a 'Growth Idea Lab' to Give MSMEs a Fighting Chance
N P Desai saw his business burn to ashes during Diwali of 2013. That was the end for the business. Now, through his new venture, he is out on a mission to help other MSMEs before they meet fatal ends.
N P Desai was shuffling along the regal halls of Leela Palace. He had a bag in each hand and each seemed to have seen quite a few years. For a man of 65, he could be surprisingly nimble when he saw someone he wanted to connect with.
“I came all the way from Hyderabad for this.” He is talking about a gathering of private equity players, ASSOCHAM and DIPP officials at the magnificent hotel on a hot Friday summer afternoon. “I collected about 20 cards, I’ll email all of them. But only 2 or 3 of these people will respond.”
Mr Desai is trying to gather investors, government and media sponsorship for his new venture to help the MSME sector. He is busy networking and trying to get people who can help to get involved in strengthening MSME businesses.
“What do you know about MSMEs?” he asked.
“MSME means micro, small and medium enterprises and they are very important to the economy,” we responded.
He grunted with mirth. “That’s what you hear on stages at big conferences. These small businesses are the reason this country is still running. But there’s nobody to help these poor business people, and they need guidance the most.
The MSME minister Kalraj Mishra said that about 14,000 MSMEs shut down because of the Chennai floods and about 50,000 lost their jobs. If each of these 50,000 people had a family of 4, that’s 200,000 lives affected by MSMES shutting down. That’s what you should know about MSMEs.”
Mr Desai himself ran a medium scale business for 41 years. “I ran a business for manufacturing various steel products. My father started it in 1973 and I joined the business the following year. I was 24. When my father died of cancer in 1976, I took over the business. I was the eldest and I had to take care of 4 siblings. I had graduated to be an engineer and wanted to leave for the US. I had to give that up to keep the shop and our livelihood running.
Mr Desai had to shut shop in 1984. “The bank we dealt with wouldn’t extend credit beyond a point and even threatened to sue. And I couldn’t find government support at the time.” However, the family managed to reopen for business in 1990 and things flourished. “We grew from a 10 employee business to a 150 one,” Mr Desai reminisced. Good days never last. “During Diwali in 2013, our shop caught fire.” The Desai family left their dinner to save their legacy. They were too late to save anything. “I’m old and my children are not in the country to run the business, so that was that.” 41 years of hard work gone to ashes and none of the legacy lives on.
Perhaps that’s not completely accurate. Because a life working in an MSME has given Mr Desai the will to help other MSME owners across the country. Towards this end, he has started Growth Idea Lab headquartered in Hyderabad.
The objective of Growth Idea Lab is to create a financial organization that can revive what Mr Desai calls ‘sick MSME units’. Basically provide monetary and advisory support to help ill performing MSMEs. “I have already put in 18 lakhs of my own money in 12 MSMEs and 3 of them are stable enough to at least approach a bank for further financial aid.”
Growth Idea Lab wants to network with as many governmental, investment and banking sector organizations so that MSMEs can find the help they need as soon as they need it before going into the critical shutdown zone.
And it’s not about money as much as it’s about guidance and advice. “80 percent of MSMEs are shut because the owners aren’t aware. They are not aware of government regulations and policies like taxes; they don’t know that bank procedure for securing loans; they don’t know the right investors who will help them or the government officers who can help them. We can just manage to get all these powerful people to be a part of one network like Growth Idea Labs, then we can educate MSME owners on how and when to get the help they need for their business.”
So far, Nalsar University’s Centre of Excellence for Economics and Finance has shown interest in Mr Desai’s Growth Idea Lab. “We have signed a MoU with Nalsar University. They will help us draft the documents and corporate governance structure we need to approach the RBI and SEBI to be registered under the proper guidelines. Growth Idea Labs will also want act as a strategic partner by infusing required funds with an assurance of reasonable return to its investors.
“I have also spoken to FICCI, CII, TECCI, FISME. We need the media to write more about MSMEs. It’s a sector that contributes more than 40 percent of employment and 40 percent of exports to our economy.”
As we take our leave, Mr Desai’s final words on the topic are filled with conviction for the cause he champions. “MSMEs need all the moral and financial support it can get.”
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