Taking Wings from Kerala

A Financial Express Feature on Mr.V K Mathews

VK Mathews is a rare individual—one of the very few who dared to show off his entrepreneurial skills in Kerala. In fact, his friends thought he was nuts to leave his plush job in Dubai with Emirates where he spent more than a decade, to return to his roots and start an IT firm against all odds.

IBS, the company he founded in 1997, today is Kerala’s best known IT company and credit for that should go to this man who took a big chance with his career. “I was very happy with Emirates, where I was provided with a luxury villa, and I also had the choicest of cars with me. At that time I was just around 37 years and most people of that age would have been content,” says Mathews, who has a post-graduation in aeronautical engineering from IIT Kanpur.

It’s not that he always wanted to be an entrepreneur. But when he saw the big opportunity waiting to be tapped in the software space of the transportation industry, especially aviation, he could not resist the temptation. Today IBS is one of the world leaders in transportation software and the vast majority of global airline majors are its customers. “To be honest, I was never after amassing wealth. Even my decision to become an entrepreneur was not charged by that. But I always wanted to do my best in whatever I was doing. That led to the decision.”

Soon after passing out of IIT Kanpur, he did something many wouldn’t. He started teaching computer science to army officers. “I found that quite tough to do. The subject was indeed new to them, and they were also more interested in warfare and artillery.” He joined the IT division of Air India in 1981. That was the start of a successful career. Mathews played a key role in the implementation of its computerized passenger services system globally. It may seem a simple thing now, but 30 years ago it was an achievement.

Shortly he got a good offer from Emirates and he decided to grab the opportunity to get the international exposure he desired. As general manager (IT) of the Emirates Group, Mathews was responsible for formulating and implementing software strategies for Emirates’ global operations. “Emirates were then a start-up company. But the chairman had great ambitions to make the airline one of the worlds best, even back then. Working with Emirates gave me all that I needed.”

That was why everyone was shocked when he decided to become an entrepreneur. “My friends did not think it was a wise decision. So I never told them that I was considering Kerala as the headquarters of my venture. If I had told them so, they would have really discouraged me. I first went to Bangalore and then Chennai.

But after I visited the Technopark in Thiruvananthapuram, I instantly took the call to set base here.”

Mathews invested Rs 1.75 crore from his pocket and then raised a few more crores to kick start his dream. Initially IBS won contracts through Mathews’ personal contacts. But he knew it was important to develop internationally acclaimed mission critical systems to compete globally.

Emirates and Swiss Air became his customers and things started to roll smoothly, till the dotcom bubble burst. Then came the tragedy of 9/11 and the aviation industry was facing its biggest crisis. His customers like Swiss Air collapsed financially and he started doubting the business potential of his venture. He had two options—one was to wind up operations and save some of the profits, or plunge into the business neck deep and take a chance. He opted for the latter.

Today he is reaping the benefits of that decision. The Kerala government is pinning its hopes on IBS becoming a global software leader and improving the image of the state. “Kerala has to develop a good physical and social infrastructure. That would be key for the development of the software industry in the state. It is now difficult to attract senior management talent from other big cities to Kerala. But the talent we have is world class and there are no worries on that count.”

The company today has revenues in the range of $80-100 million and is planning an IPO in 2012. Along the way, Mathews has gone in for a few strategic acquisitions and today IBS offers software products in areas of airline operations, airport management and airline cargo, oil and gas logistics, cruise and hospitality management along with ocean transportation. General Atlantic has invested $60 million in IBS. And that’s the biggest PE investment made into a Kerala-based company. Its new generation cargo management solution i-cargo is making waves worldwide. IBS has arrived on the international scene.

Today Mathews is an advisor to the government of Kerala in areas of IT, management and education and a member of the state’s IT advisory board. He is the president of GTECH, a strategic grouping of IT&ITES companies in Kerala, which is modeled on the lines of Nasscom.

His ambition now is to make IBS the number one company in the travel, transportation and logistics (TTL) software space globally. “By year 2020, I want to achieve that dream. I believe we have all the tools for it.”...

Kerala IT firms eye Nordic markets

BS Reporter

To help the small and medium IT enterprises in Kerala scout for business opportunities, the Group of Technology Companies (GTECH) has identified Denmark, Sweden, Norway and Finland as potential growth markets in the initial stages.

These countries face a demographic challenge and cost pressures to sustain their economic growth which is dependent on cutting edge technology and innovation, it said.

It identified the emerging sectors like clean technology, health and life sciences as thrust areas, and said Kerala IT industry could play a critical role in sustaining the competitiveness of these economies by offering cost competitiveness and quality solutions.

GTECH has drawn up a structural framework for deeper engagement with Denmark and Sweden. As a first step, government delegations from both these countries visited Technopark and Infopark recently to showcase and identify the potential business areas for the Kerala-based IT companies. The delegation mooted the idea of GTECH taking a delegation of CEOs to the Nordic countries to establish joint venture partnerships to tap buisness opportunities.

“The UK and the US markets are the current targets for the Kerala IT Industry. But with the economies of these countries slowing down, there could be a cut on the IT spend of companies located there. The need to look at newer markets has never been greater,” said Anoop Ambika, secretary, GTECH. “The Scandainavian countries present a fantastic opportunity for the SME's in Kerala to tap.”

IT sector to extend operations to Scandinavian region

Special Correspondent

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GTECH to help State's enterprises find opportunities in Sweden, Finland, Norway and Denmark.

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Thiruvananthapuram: The IT industry in Kerala is preparing to extend its footprint to the Scandinavian region of Europe for identifying fresh business opportunities and accelerating growth.

The Group of Technology Companies (GTECH) has unveiled a strategy to help small and medium enterprises (SME) in the IT sector scout for new business opportunities in Scandinavian countries.

Lull in U.K., U.S.

“The UK and the US markets are the current targets for the Kerala IT industry. But with the economies of these countries slowing down, there could be a cut on the IT spend of companies located here. The need to look at newer markets has never been greater. The Scandinavian countries present a good opportunity for the SMEs in Kerala to tap”, says Anoop Ambika, secretary, GTECH.

The strategy proposes to target Denmark, Sweden, Norway and Finland in the initial stage.

These countries face a demographic challenge and cost pressures to sustain their economic growth which is dependent on cutting edge technology and innovation.

According to GTECH, the IT industry in Kerala could play a critical role in sustaining the competitiveness of these economies by offering cost competitiveness and quality solutions. The new emerging sectors like Clean Technology, Health and Life sciences have been identified as the thrust areas.

First step

GTECH has formulated a structural framework for deeper engagement with Denmark and Sweden. As a first step, a delegation of government officials from these countries visited Technopark and Infopark recently to identify the potential business areas for the Kerala-based IT companies.

Shanker Subramaniam, Senior Investment Manager, ‘Invest in Denmark' and Srikant Illuri, Country Head, ‘Invest in Sweden,' both investment promotion agencies of the respective countries, were part of the delegation.

The delegation mooted the idea of GTECH taking a team of CEOs from Kerala to Nordic Countries to establish joint venture partnerships and identify business opportunities. “We have plans to bring in government representatives from some more countries in the near future,” says Anoop Ambika.

GTECH looking at Nordic countries for opportunities

Kerala's IT industry could play a critical role in sustaining the competitiveness of these economies, by offering cost competitiveness and quality solutions.

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Our Bureau

Thiruvananthapuram, Aug. 16

The Group of Technology Companies (GTECH), Kerala, has unveiled a unique strategy to tap market opportunities in the Scandinavian region of Europe.

This will be part of the GTECH agenda to help small and medium (SME) IT enterprises in the State scout for business opportunities and expand their reach, an official spokesman said here.

The strategy is part of a vision to identify potential growth markets for Kerala's IT industry. This is in tune with the broad objective that GTECH has set out to achieve - accelerated growth of the IT and ITeS sectors. GTECH proposes to target Denmark, Sweden, Norway and Finland in the initial stage.

According to the spokesman, these countries face a demographic challenge and cost pressures to sustain economic growth, which is dependent on cutting-edge technology and innovation.

Kerala's IT Industry could play a critical role in sustaining the competitiveness of these economies, by offering cost competitiveness and quality solutions.

Emerging sectors such as clean technology, health and life sciences have been identified as the thrust areas, the spokesman added. The Scandinavian region has also been witnessing high ICT adoption and research and development investments on IT infrastructure, that provide a unique opportunity for the IT Industry.

GTECH has already drawn up the structural framework for deeper engagement with Denmark and Sweden.

As a first step, Government delegations from both these countries visited Technopark-Thiruvananthapuram and Infopark-Kochi recently, to identify potential business areas for resident IT companies.

The Danish Government was represented by Mr Shanker Subramaniam, Senior Investment Manager, Invest-in-Denmark, and the Sweden team by Mr Srikant Illuri, Country Head, Invest-in-Sweden.

The visiting delegation proposed the idea of GTECH taking a delegation of CEOs to the Nordic countries, to establish joint venture partnerships to tap business opportunities.

According to Mr Anoop Ambika, Secretary, GTECH, the UK and the US markets are the current targets for the Kerala IT Industry.

However, with the economies of these countries slowing down, the IT spend of companies located there could go down.

There is an urgent need to explore new markets, he said. “We propose to bring in Government representatives from some more countries in the near future,” Mr Ambika added.