Vijay Shekhar Sharma, Founder & CEO, Paytm

‘My mother thought I am in business because I couldn’t get a job’ There are no cabins at the second floor office of One97, the company that owns the mobile wallet and ecommerce brand Paytm (Pay Through Mobile). We are made to sit in a conference room as 37-year-old Vijay Shekhar Sharma, its founder, has lunch downstairs. In about 10 minutes, he appears. It’s Friday, so he is simply dressed, in a black t-shirt and blue jeans. He takes us to his desk in the middle of the floor. It is surrounded by similar desks where people sit and work. “We don’t want ideas to be squeezed in cabins. It should freely flow from top to bottom,” he says.

Motivational quotes with pictures of Steve Jobs adorn the glass walls across the building. One quote finds special mention everywhere—‘Go Big or Go Home.’ “That’s our company goal for employees. There are immense growth opportunities here and everyone should be passionate enough to grab them,” he says.

Sharma is an archetypal new age first generation entrepreneur thinking ahead of time. It also meant that there weren’t many takers in the beginning for his idea. It is different now. Jack Ma, founder of Alibaba, China’s biggest e-commerce company, is investing $600 million in his company. Not a mean achievement for someone who couldn’t do an MBA after his B Tech because he didn’t have the money. Today his company is valued at $3.4 billion and he makes it a point to hire the best MBA graduates from top institutes. “It’s like a revenge with the system,” he laughs.

Sharma is from Aligarh, the son of a Biology teacher. He studied in a Hindi medium government school and realised that he didn’t know enough English to sit for engineering examinations. So, after completing school, he took a one-year break to learn English. “There used to be multiple choice questions in the entrance examinations. I used to look at the different answers to figure out what questions they were asking,” he recalls.

But he did well, went to Delhi College of Engineering (DCE) and was the topper of his batch. He had always wanted to make it big and a job wouldn’t give him that scope. “I used to read a lot about Steve Jobs and Apple. I won’t say that I was dreaming that big but I wanted to do something on my own as futuristic as Apple,” he says.

In 2001, just as the mobile revolution was taking off, he started a company that would focus on mobiles. He was also providing consultancy to media publications on how to create content for the internet. He recalls an event around that time that changed his life and confirmed his belief in business. In 2001, Airtel asked him to provide the content he was offering on the internet, on the mobile platform. He received a cheque of Rs 100 for it. “The payment was not big but made me realise that I am on the right track and this business is going to grow,” he says. It prompted him to launch One97, offering value added services (VAS) on mobiles at a time when messaging was just growing in the market. “Everyone told me that there is no market for services offered on mobile phones,” he says. But later, the content market on mobile grew bigger and Sharma took this opportunity to grow further. His venture, One97 soon started servicing different telecom players.

Sharma shares an interesting story of making his first million. When he started the business, his family members, especially his mother, was very apprehensive about the idea. “In a middle class family, a job is considered to be the real big thing. Relatives in my hometown would come to my mother to say I am in business only because I couldn’t get a job,” he says. He told his mother not to worry and the thought of making a million came at that time. But he forgot about it. The value-added service (VAS) business soon started to grow, and in March 2007, when he was taking the annual meeting to know his revenues for the financial year, his accountant made a presentation to announce that the company had earned a net profit of Rs 5 crore for the first time. It only struck him once he was out of the room that he had made his first million (in dollar terms) and shouted, “Wow! I have become a millionaire.” “I was not able to think of anything else that day. That was the first time I felt I achieved something I could share with my family,” he says. He immediately left for Harduaganj in Aligarh, where his parents were and for next three hours felt like a proud Bollywood-style hero coming back home after making it big. He told his mother he had become a crorepati. “Crore was really big for a lower middle class family from a humble background,” he says. Today Sharma’s personal wealth is worth several million ($672million), but the first million was always special.

Has money changed him? “Not much,” he says. “It is just that certain aspects of my lifestyle have undergone a change.” He lives in a rented accommodation. He loves cars but doesn’t like to have a fleet. He started with a modest Honda City, graduated to BMW X1 and is now driven around in a Volvo XC60.

One big change Sharma notices in his life is time for the family. He makes it a point to spend weekends with them. Even when he travels on a business trip, he tries to take his family along.

It was not always smooth sailing. When India was experimenting with 3G from 2008 to 2011, Sharma had troubles relating to both finance and human resource. The valuation of the company, which was $25 million in 2011, slipped to $10 million in 2012, the fastest drop for him in one year. Several senior executives left the company, and working with the same gusto became difficult. He called a meeting of his staffers and told them to have faith in him. “I just said, maybe the times are tougher now, but if we work hard we would be much ahead of others,” he says. “When down and out, it is not motivation, but emotions which bring you back and make you go ahead.” He also planned an IPO and completed the paperwork when the stock market went through a crisis in 2010-11, especially in the mid-cap segment. “Our banker advised us against going for the IPO at that time,” he says. “They asked us to wait and we scrapped the plan.” The stock market picked up later but he decided against an IPO because he didn’t need the funds anymore.

The business recovered and was going well, but Sharma was looking for the next big thing. “I don’t think ahead of time, but I think like a consumer myself. If I am convinced about a particular product today, only then can I convince others that it would do well in the future. Maybe not now but even if it is five years down the line, it is okay for me,” he says. The idea of a mobile wallet or payment through mobile phones was being tried at a global level, and Sharma too was gathering as much information as he could on the subject. He launched Paytm in 2011, only to face opposition from investors and the board of directors. During a board discussion on the idea of Paytm, Sharma says he placed his one per cent equity in the company on the table and said, “This is what I am putting into Paytm and if I don’t make it grow by more than double in a year, then do whatever you want with this money.” The board approved an investment of Rs 5 crore in the company. From $1 million in 2011, Paytm has grown into a multi-billion business today.

The Indian e-commerce market is estimated at $20 billion now and according to Goldman Sachs, it will reach $300 billion by 2030. Looking at its possible size, Sharma wanted to be a dominant player. He had the first mover advantage through Paytm but needed a push from a global player, and that was how the Alibaba investment happened. Sharma first met Jack Ma in 2011 in Hong Kong at an event where Ma gave a presentation on Alibaba’s growth from $64 billion to $126 billion in one year. “That mesmerised me for days. I was just thinking of Jack and nothing else,” he says. He found lot of similarities between them, such as coming from a humble background and thinking ahead of time. He attempted to reach Jack and finally met him at the Alibaba headquarters in Hangzhou, China in October 2014. “Jack told me, ‘Sharma I trust you. Smart people build companies but those who have gone through adversities build great companies.’ I was convinced Jack would invest in my idea,” he says.

The investment was also the result of a global rivalry between Amazon and Alibaba with the former already foraying into the Indian market. Alibaba wanted to catch up. Collaborating with Paytm gives them the advantage of having an e-commerce platform along with a mobile payment licence. The two companies signed the deal on 11 November that year, wherein Alibaba would make an investment of around $600 million in Paytm and acquire a 25 per cent stake in the company. Sharma has a bigger plan for Paytm. “India has several companies in the services domain, but there is not a single company like the Amazons and Alibabas of the world. I dream of making Paytm into a $100 billion company respected by the world,” he says. Paytm got lot of attention in July this year when it became the title sponsor of the Indian cricket team for four years. For the first time, an e-commerce company was even bidding for cricket sponsorship. “I asked my media campaign team to offer me something that would create value for years. They came with this idea and I said ‘sounds good’,” he says. The deal would cost him around Rs 203 crore in four years, which he finds right for a company aiming to become a global brand.

Sharma keeps a low profile despite his success and attributes this to his growing up days. “When you come from a family that values every small thing in life, it helps to remain grounded,” he says. “We started from marketing content, then we created content for mobiles, got into utility payments and now Paytm is a full-blown market place. We didn’t make a noise like the others in the market.”

Paytm currently has 66 million mobile wallets and Sharma claims that it will cross 100 million by this year-end. New segments are being added to the e-commerce market and all are driving growth further. “I personally believe that payments for purchasing apps would grow manifold apart from the e-commerce selling platform,” he adds. Not bad for a man who had to take a part-time job to show his in-laws a salary slip so that they could marry their daughter to him. He now makes it a point to invest in startups every year. In the last five years, he has put in amounts ranging from Rs 5 lakh to Rs 1 crore in over 32 startups. Paytm now aims to invest $150 million in a dozen tech startups that could further help them grow. Sharma always makes strategic investment to leverage the best out of it. “It should be an equal deal for both the partners,” he says. He also has a rule in his company—whatever would be the profit earned on a holiday would be donated to social organisations. “I love surprises and we surprise organisations with our help without them approaching us.”

About The Author

Kumar Anshuman