There was a time when I debated between becoming a professional or an entrepreneur. Eventually, it took me less than 2 years working with a large finance company to realize that my love lay elsewhere. Hailing from a business family that has been operating a Sugar Mill in Pilibhit for the last century, it was not difficult to see why. My family background coupled with professional experience enabled me to naturally evaluate and analyze diverse risk-return issues and to instinctively identify potential business opportunities. My limited role working with an Asset Management Co. could only provide me with so much. With this thought, I joined my Family Business in Hospitality in early 2003. It was around this time, that I started looking for a mentor, someone whom I could turn to for business advice. While my father & uncle had started the company and were always there to help me every step of the way, it was not always possible to turn to family for unbiased help.
It was around 2006, that my cousin recommended me the name of EO (Entrepreneurs Organization). After talking to him at length, I discovered that EO is a dynamic, global network of more than 8,000 business owners in 40 countries. Founded in 1987 by a group of young entrepreneurs, EO is a catalyst that enables entrepreneurs to learn and grow from each other, leading to greater business success and an enriched personal life. Membership in one of EO’s 118 global chapters is by invitation only; the average member is 40 years old with annual revenues of US$18.4 million. Besides a membership fee, aspiring EO members have to go through a rigorous selection procedure.
On a lark, I decided to apply for membership and simply forgot about it. A couple of weeks later, I got a call from the local chapter for a friendly Board Interaction. Sure enough, I was accepted as a member and life has never been the same since then. Amongst the many benefits, EO has to offer, The Forum perhaps adds the greatest value. A Forum is a unique communication model that provides unparalleled access to the wisdom of your peers during confidential monthly meetings. My new ‘best friends’ and my new ‘board of directors’ have for the last 4 years have added immense value to my personal & professional life of which, I put below just one particular instance.
Over the last many years, I have seen the Indian Hospitality Industry up close and personal and our company, Leisure Hotels Ltd., runs the largest hotel chain in Uttarakhand with more than 20 properties across 15 locations. There are another 10 in the pipeline across the state & elsewhere. We tweaked the old model of running only owned properties to include properties on Management as well as short duration camps with a short gestation period.
While initially, human resources & brand visibility was an issue, we realized soon enough, that “if you build, they will come”. We were not able to fund new projects from internal accruals. We decided to adopt an aggressive stance and took on debt to build some new large properties. Sure enough, we were saddled with interest & principal payments that were not freely funded by existing cash flows. While we were aggressive with our expansion plans, and plenty of debt was available, The Forum warned me of adequate ‘capital gearing norms’.
After my initial presentation on the cash flow crisis, I had two members from the Forum with whom I had carried on individual conversations continue to ‘coach’ me on the finer nuances of ‘debt financing’. Their individual inputs and the collective wisdom from the Forum, shaped the financial strategy for the organization. On the Forum’s advice, we hired a Financial Consultant, who comes in once a week to give finishing touches to our short & long term financial planning. Cash flow planning became an important weekly activity from being just another exercise relegated to our accountants.
Backed, with the support of my Forum, we ventured towards taking our hotel company into the next orbit. We needed deep pockets and courage of conviction in our chosen path. The Forum also supported us by suggesting ways for us to raise funds to stay ahead of our expansion plans, lest we need to defer them. Various options are being considered; divest non-core assets, private equity, joint venture and even bringing in investors on a project basis rather than on an enterprise level.
The Forum’s input in financial planning helped me separate the ‘wheat from the chaff’. The Forum Members have held my hand every step of the way and I am proud to have Forum Members as ‘friends for life’.