Slum-dweller hoping to end hunger in India through catering-business he founded

[Saddle Bronc 124]

http://www.bbc.co.uk/news/business-16248442

My Business: The slum dweller who founded a food chain

2011/12/20 19:00 ET

What makes an entrepreneur? Parul Agrawal, of the BBC Hindu Service, and Heather Sharp hear from Sarath Babu, 31, a former slum dweller who wants to help end hunger in India by employing 100,000 people in the catering business he founded.

The bamboo walls have been replaced with brick, and what was once a slum has improved over the years.

But Sarath Babu, 31, still lives with his mother in the hut she raised him in, in the Indian city of Chennai.

Despite his shiny shirt, Blackberry and beloved Chevrolet, he has few of the trappings of a graduate of one India's top management schools - despite the fact he now employs 250 people in his fast-growing catering empire.

Sarath still lives in the same hut that his mother raised him in

Born to a family with next to nothing, Sarath dreams of an India without hunger.

He has set himself the target of providing for half a million people, by creating 100,000 (known as one lakh) jobs.

"I give a job, and that person takes care of four to five people - so I take care of five lakh people directly," he says.

He still regularly visits a slum similar to the one where he and his sister used to sell idlis - steamed rice cakes - made by his mother.

She became the sole breadwinner for five children after Sarath's father died.

It was her commitment to raising the money to put him through an English-language school that opened the door to a different life.

At the school he met middle-class children, and noticed that they had several sets of clothes - while he wore one school uniform for three years.

He also discovered his ability to come top of the class.

"I realised that without involving my mother's effort, or my teacher's effort - only with my effort - I could get some recognition and this didn't require money," he said.

And from then on, he began studying hard.

Sarath eventually gained entry - and a scholarship to cover some costs - to BITS Pilani, one of India's most prestigious and highly selective universities.

After working for a software company for three years to pay off university debts, he then went on to complete an MBA at another elite institution, the Indian Institute of Management (IIM) in Ahmedabad.

'Dark and challenging'

But when offers of well-paid jobs finally began to roll in, they brought with them a dilemma - which Sarath says he visualised as two doors.

One represented all that wealth had to offer, the other his long-standing dream to start a business that would transform the lives of those who, like him, started out poor.

To the first door, he says he said: "Me and my family suffered because of you, today I know that I can have you, but I don't need you."

Instead, he chose the second option. "I knew that it was going to be really dark and really challenging, but I knew at the end of this path it's going to be really beautiful - so I thought I should stick to my dream."

Sarath launched Foodking in 2006, supplying snacks to banks, software firms and other corporates, with just 2,000 rupees (£24; $38) to fund the first month.

But with his impressive academic pedigree, he was soon able to secure a bank loan of 100,000 rupees (£1,205; $1,890), and employed eight to 10 workers.

The expansion continued, and he now has seven outlets and an annual turnover of $1.3m.

The first year was tough, however. At one point, Sarath missed a train and found himself forced to sleep on a station platform as he could not afford a bed for the night. He considered giving up.

"But then I said to myself, so what if you are an IIM-Ahmadabad guy? Can't you sleep on the platform - there are 300 other people sleeping on the platform - let them all sleep in homes and then you can think about yourself...

"Until then, you think about the business, you think about them."

And Sarath's drive remains strong.

He wants to have 100 outlets by the end of this year - and 5,000 across the state eventually.

Foodking aims to offer good food at affordable prices - as well as to create jobs for the poor

Family loans

He already gives lectures at schools and business institutes, and spends time encouraging children in a local slum to continue studying.

And he hopes to inspire 1,000 entrepreneurs across the state, who too would go on to create employment opportunities for others.

Sarath's approach is clearly shaped by his humble beginnings.

He is determined to provide affordable, good quality food. Foodking's meals cost 20-45 rupees (25p-54p; $0.37-0.84) each - which would more usually buy only fast food.

To keep prices low, premises are simple. And while Sarath is happy to pitch in and help the workers out, he's tough on waste, challenging staff over unused chopped vegetables and taps left running.

Sarath's relatives loaned him money for his university fees, while his sister pawned her wedding jewellery to help cover the cost of his MBA.

His gratitude is evident, to them and even more deeply for his mother's sacrifices - as is his determination to provide for his family.

But although he has been offered salaries of up to $33,000 (£21,050) a year - highly paid in Indian terms - he says he never saw turning down employment and starting the business as a risk.

"What is risk? It's risk to lifestyle. Having come from the slum, with absolutely nothing… there is absolutely no risk for me."

[Susita 175]

That's a wonderful story.