BW Communities

Grit, Guts And Gumption

Business World Jul 07, 2015

What does not kill you makes you stronger. It’s true. After battling cancer, Shripal Morakhia is back to chasing his dreams by K. Yatish Rajawat On 21 May 2015, inside an office block on the ground floor of Cyberhub in Gurgaon, chaos reigned. The staff was only halfway to installing a bowling alley, a cricket pitch, an SUV on a pedestal, a hang glider and an F1 car replica; tools were everywhere and wires hung from the top as the false ceiling was yet to go up; the furniture was missing as the delivery truck had met with an accident; and the imported LED lights were stuck at the customs. This was the scene at Smaaash Entertainment’s second under-construction reality game facility, after Mumbai, just days before the launch. Things were clearly behind schedule. Outside the venue, a team of officials stood in a huddle discussing the options — they could either postpone the launch date from 28 May or  could do a limited, soft launch.  And while they racked their brains, a bearded, bespectacled, professorial looking man — Shripal Morakhia, founder of Smaaash — walked in. His hands shook uncontrollably but his voice was steady and demeanour steely. He looked at the chaos and his team’s crestfallen faces, and he knew a miracle or two were needed. The team was running against a deadline; Sachin Tendulkar, a shareholder in the company, was scheduled to inaugurate the venue on 28 May. He would not be available after that as he was going on a two-month holiday. Morakhia did not want to postpone the launch for two months and nor was he willing to dispense with Tendulkar’s brand value.   So, the first thing he did was get his shipment released from the customs. He pleaded, cajoled and screamed when necessary to ensure that work picked up pace. Fabrication contractors agreed to open their factory at seven in the morning and keep delivering until two at night. His staff worked non-stop for 48 hours. Morakhia handed out cash bonus every day to keep the work going. Ashok Cherian, chief marketing officer of Smaaash, describes it best:“Most people look at the soft spoken Shripal and do not realise the pent up energy, but he unleashed it fully. Everyone was surprised at the results, when we launched on time.”<table align="center" border="1" cellpadding="1" cellspacing="1" style="width: 600px;"><tbody><tr><td><img alt="" src="http://bw-image.s3.amazonaws.com/Sripal-Morakhia_founder-MD_Smaash_SD19-lrg.jpg" style="width: 650px; height: 384px;"></td></tr><tr><td>A Park Of A Different Kind He wanted to start a children’s amusement park, but high real estate prices didn’t allow that. So he created something different</td></tr></tbody></table>Morakhia, The Broker The city had never seen or experienced F1 racing cars or hang gliders using augmented reality headsets. The experience of entertainment will not be the same again; those arcade games just won’t do anymore. This is not the first time, and it may not be the last that Morakhia has played the disruptionist. The serial entrepreneur has been disrupting business sectors for a long time. As a 20-year-old, he first took over his family business of stock broking —  SS Kantilal Ishwarlal (SSKI) — and created history by becoming the first broker to be suspended by the Bombay Stock Exchange in the early 90s for keeping inadequate margins with the exchange. It was a tough time — a true blue Gujarati stock broking business running for generations closed down overnight. Morakhia, being who he is, decided to reinvent stock broking. Indian broking firms in those days did not rely on research. By the mid-90s and after the Harshad Mehta scam, foreign broking firms were allowed to set up offices in India, and they came with fancy research and even fancier salaries. SSKI became one of the first Indian stock broking firms to give foreign salaries and a share in the pool of trading profits. SSKI broke the mould and forced almost every Indian stock broking firm to reinvent. SSKI also ventured into merchant banking and facilitated quite a few public issues, some of them questionable. Those were heady days when every public issue would get oversubscribed many times. Merchant banking fees were high; 4-5 per cent more than stock broking.<table align="center" border="1" cellpadding="1" cellspacing="1" style="width: 600px;"><tbody><tr><td><img alt="" src="http://bw-image.s3.amazonaws.com/Sripal-Morakhia_founder-MD_Smaash_SD09-lrg.jpg" style="width: 650px; height: 384px;"></td></tr><tr><td>Morakhia wants to take Smaaash to five new cities. He is also in talks with developers in Pune to build a theme park</td></tr></tbody></table>“It was a period in my life when I chased wealth and I’m not particularly proud of it. We shared profits with our employees; gave stock options much before Infosys made them popular.” Infrastructure Development Finance Corporation (IDFC) first acquired 33.33 per cent in SSKI in 2006. It eventually bought out the other investors by 2010, paying out approximately Rs 1,450 crore in all. Morakhia was also instrumental in creating the first e-broking outfit in the early 2000s. Sharekhan.com allowed investors to trade directly on the stock exchange without the assistance of brokers. Several companies entered the e-broking business after him but soon closed down. Sharekhan continues and has outlived them. The Morakhias sold Sharehkhan to Citigroup Venture Capital and are effectively out of the broking business. The Disney Dream After the first deal with IDFC in 2006, Morakhia was flush with funds and started exploring new avenues. He got into film production with his company iDreams and produced the raging hit Bend it Like Beckham and Monsoon Wedding, among other titles. He also began investing in entertainment technology and dreamt of creating a Disney World. “More than Disney World, I was inspired by a children’s park in Amsterdam; but real estate being so expensive in India, it was just not possible. However, I continued to be obsessed with some of the new technology emerging from the entertainment world,” he says. The search for content to create augmented reality for children led him to comic maker Amar Chitra Katha. Morakhia bought out Amar Chitra Katha (ACK), an iconic brand that was struggling in the digital world. Inspired by the founder of ACK, Anant Pai, he pumped in Rs 45 crore into it along with another entrepreneur Samir Patil. But the experiment to turn ACK into another Disney failed. Says Patil, “The thing about Shripal is his enormous enthusiasm and a childlike curiosity about things.”<table align="center" border="1" cellpadding="1" cellspacing="1" style="width: 600px;"><tbody><tr><td><img alt="" src="http://bw-image.s3.amazonaws.com/Sripal-Morakhia_founder-MD_Smaash_SD04-lrg.jpg" style="width: 650px; height: 384px;"></td></tr><tr><td>The Stuff of Dreams In 2009, Morakhia started Smaaash Entertainment with Sachin Tendulkar, and launched the first reality game facility in Mumbai</td></tr></tbody></table>But by 2007, Morakhia’s energy was flagging — he was diagnosed  with cancer. He started exiting his businesses one by one, including iDreams and ACK, by selling them to his existing partners. It was a tough period for him. “I was really hit hard by my illness. I think it was part of my karma that came back to me. I was never happy when I would do some of the public issues in SSKI and some old pensioners lost their money,” he says. “In all these years, I developed a keen business sense, but I think I never developed the maturity that comes from a high emotional quotient,” he adds. A Brush With Cancer Cancer is curable, but it can drain one out completely. But Morakhia didn’t let the disease get to him. After he recovered, he went back to his dreams. He started Smaaash Entertainment in 2009 with Tendulkar. He also wanted to build a go-karting track. But the real estate prices in Mumbai were very high, so he did the next best thing. He built it on the roof of Kamala Mills and called it Sky-Karting! Since 2008, he has been primarily focusing on two businesses, Smaaash Entertainment and Yoboho, a digital media company that makes videos for children aged 4-8 years under the Hooplakidz brand. He sold off Yoboho to German media conglomerate Bertelsmann for $20 million (Rs 120 crore) early this year to focus on Smaaash.  <table align="center" border="1" cellpadding="1" cellspacing="1" style="width: 600px;"><tbody><tr><td style="text-align: center;">CAREER MOVES</td></tr><tr><td>POINT OF ENTRY: Joined the family broking firm SSKI in the early 80s. Launched e-broking firm Sharekhan.com in 2000.Started a film production company iDreams Production in 2002 BIG MOMENTS: Sold SSKI to IDFC for Rs 1,450 crore. Also sold Sharekhan.com to Citigroup Venture Capital NEW CHAPTER: Started Smaaash Entertainment in 2009. FY15 revenues: Rs 400 million; FY 16 (projected revenues): Rs 850 million</td></tr></tbody></table> Morakhia is again flush with funds and is hell bent on realising his dreams; he wants to expand Smaaash and take it to five new cities. He has been working on taking it to Dubai for a long time. He is also in talks with real estate developers in Pune to build a theme park; the Disney World dream has still not died. Like any entrepreneur, Morakhia lives in the future, and though he is not young at 59 years and has Parkinson’s, it is the passion to reinvent that keeps him going. If there were more entrepreneurs like him who worried less about wealth creation and more about legacy, the BSE Sensex might look different. The author is a senior journalist, based in Delhi.   @yatishrajawat (This story was published in BW | Businessworld Issue Dated 27-07-2015)