Shyam Sekhar – The Entrepreneur’s Guide to Growth and Wealth – ContraMinds Timeless Wisdom

Episode 3: The Entrepreneur’s Guide to Growth & Wealth

(Personal philosophy, evolution, and long-term thinking)

• Q4 – Generational Views on Capital & Gratification

• Q10 – Money vs Wealth

• Q12 – The Entrepreneur’s Learning Curve

• Q13 – Managing Gains & Sustaining Wealth

• Q14 – Values, Beliefs & Independent Thinking

Theme Essence:

Beyond capital and markets lies the deeper game—gratification, self-awareness, values, and purpose. This episode ties together how entrepreneurs evolve, define wealth, and stay grounded in their own philosophy. 

Q4 Capital – Perspectives across generations (Gratification)

[Vignesh] (13:54 – 14:33)

So, Shyam, based on… Yeah. So, Shyam, just as a follow-up to this, I am very curious to know how… So, I think we are in a very transitionary stage right now in this country where, you know, there is an old guard of business owner operators who were lifelong companymen and then they went and they ventured on their own and now we have an entirely new swath of young people who want to either go work in venture or they come right out of college and they start building companies. So, my question is, you know, how does the previous generation view capital differently from the current generation?

[Shyam] (14:35 – 18:32)

I think it has to do only with our world view of what is gratification. I think that… that would decide what should be your expectation out of a business. There are people who don’t like to do the same thing for 20, 30, 40 years.

They build something with great passion over 5 to 7, 10 years and then when they feel that they have got the gratification they wanted out of the process of building something, then they decide to move on and they give a mature or relatively stable business to somebody else who can grow it and handle the maturity phase of the business. Whereas, if somebody wants to just sit back and enjoy the fruits of his creating something, then he may be interested in running a stable mature business also for 5 to 10 years later, longer. It depends upon what is your gratification.

Is your gratification building businesses?

Is your gratification just merely owning businesses?

Or is your gratification about getting value out of selling a business?

There are different ways in which you view gratification. In some instances, it could be a mix of all these things. So, we will have to see what is the dominant expectation of the founder or the entrepreneur.

Once he is clear, then he has to work towards what he wants. It’s as simple as that. There is no one view.

It’s about what you are comfortable with. But one thing very very important is if your world view of gratification is one thing, I see no merit in your trying to do something extremely far away from that view. Try to be closer to what is your world view of gratification because only then you will do what you are naturally capable of doing well.

Otherwise, you will be in a zone which you are not comfortable with. I will give you an example. There are people who are very good at organically building businesses.

These guys are like the tortoise in the proverbial hare and tortoise race. Now, if a tortoise suddenly says that I am going to behave like a hare and I am going to impress all the venture capitalists and try to tell them how I can do things very very fast, he is going to be a little bit out of his depth doing something which is naturally not his forte. So, that is something one should be very very capable of avoiding.

That is something you should be conscious of not doing. So, I think that once you are clear about what you are good at and you are sure that what you are good at sits well with what you want to do, the business should also allow you to do that. I may be good at something, but I may be the right man in the wrong business.

Once you avoid that, then you will be moving towards your idea of gratification in a way in which you can realize it. You will know it. Doing that unnaturally or against your nature is not going to lead you to a good place.

You are not going to get your gratification and the people whom you take along in this journey are also not good fellow travelers to have on it. So, that is something in which nobody will be happy. So, this decision should come to the entrepreneur.

He must either be wise enough to understand this or he should surround himself with reasonable wisdom to give him this thought process.

[Vignesh] (18:32 – 19:00)

So, you are also saying it has to do with a high degree of self-awareness. So, you are saying that it’s got everything to do with self-awareness and it’s also about understanding one’s own competence because if you are not self-aware and if you are not competent, it doesn’t matter how much capital you have, it might most of the time end up going in flames. Right?

[Shyam] (19:01 – 19:38)

That’s correct. There have been instances where people have raised a lot of money by doing something which is against their nature and then come under pressure in delivering it and then lost out the control of what they try to create and then seeing the same venture do well in the hands of somebody else. Now, where was the fault line?

The fault line was in how you set about going to accomplish what you wanted. That’s all.

[Vignesh] (19:41 – 20:29)

I think this is really interesting because I read this book a very long time ago called The Road to Character by David Brooks and there is one sentence, it’s a giant book with vignettes of a lot of famous people but only one sentence in that book I think I carry with me to this day which is his definition of the word humility and he says that when most people think of the word humble or humility they think of people who give their team their credit, who give everybody else credit etc. But he says humility is accurate self-awareness.

So in a certain sense, the best founders are very very humble in that sense because they know themselves, they know their capability, they know where they succeeded and where they failed which allows them to be more intelligent with capital. Is that assessment correct?

[Shyam] (20:30 – 21:21)

Yes, that’s very true. You see who are the most successful entrepreneurs in our country whether people who inherited family businesses like an Azeem Premji who then created something out of it which is of such enormous size or a Sridhar Venbu or a Narayana Murthy. You see there are so many people and you will see a running trait along many of these high achievers.

Even you see people who have built social entrepreneurship ventures, co-operatives, you see Kurian, you see Shanta, you see so many people who have built so many institutions. The institutional imperative is well understood by them and when they understand that there is a lot of their personality and character that contributes to that evolution. It’s there for all to see.

[Swami] (21:24 – 22:50)

That’s really a great insight and I think it’s so true Shyam. I think not many people really are so self-aware about what their strengths and weaknesses are and therefore what they need to do. I think it’s a very nice way you put it.

Q10 Money Vs Wealth

[Vignesh] (47:15 – 47:39)

So so as a so on a parallel track Shyam, I want to ask you a very basic question which I don’t think is even taught in our schools which is there are many things which are not taught in our schools but from the tone of the conversation and the con and the types of ideas you are tackling my question would be what is the difference between money and wealth in your opinion

[Shyam] (47:45 – 50:25)

money is something you need it’s something which is always demanding a purpose. if you get money you have to run your house, you may need to buy a car, you may need to educate your children, you may need to take care of your parents, you may need to buy a house when that money rises to a level at which all these needs are met and you are still making more money than you needed, or you imagined, or you expected to you are slowly entering the domain of wealth. the challenge before every purpose is that when the purpose is fulfilled what do you do next. so I think that money also has that challenge and when it increases and it becomes wealth and more wealth and then when it becomes something well above what you expected to generate, you need to keep on purposing it… you need to find purposes for wealth but for money know how to purpose our money I see a lot of super wealthy people think that they will purpose it later I mean when you enter your 60s or 70s you can’t postpone it… everybody as I said is not lucky enough to be Buffett or Munger to sit at 93 and 98 and still be having the luxury of time. so this purposing should be constant in my opinion… Indians should constantly purpose wealth… whether it is for children, whether it is for charity, whether it is for investment whether it is for asset classes, you have to keep on purposing… then money when it becomes wealth tends to be handled in a much better way and when it becomes more and more that handling demonstrates the required maturity otherwise it’s going to be wealth again becoming money that should not happen.

Q12 The Journey of an Entrepreneur 

[Vignesh] (55:53 – 56:33)

Just as a follow-up to that Shyam one question I have is founders come in with a certain understanding or a lack of understanding of capital and finance when they run their first company and they come in with a completely different set of ideas, beliefs, processes, and protocols that they really want instituted the second time they go and build their venture. so can you talk a little bit about what kind of a transition that a founder makes from being a complete novice in terms of understanding the financial side of their business so when they become an experienced operator and they become very very savvy what is that journey like?

[Shyam] (56:37 – 58:56)

I think it’s the same as an investor like you make an early investment your early investments teach you what not to do. There are clear takeaways and lessons. So an entrepreneur has far more lessons than an investor actually because he would have made mistakes on multiple fronts and he would have faced situations which he never anticipated.

He will take all these learnings into his next effort or his next innings and it’s quite natural that he will not go to places where he will meet the same problems again. It’s quite natural… like an investor matures with every cycle of investing an entrepreneur will mature with every entrepreneurial innings. It’s good. It’s healthy. 

In fact, every entrepreneur who has sold a business or done something and moved on to the next thing whether the first thing was successful or failure it doesn’t matter. When you move to the next one I think it’s very important to take your learnings into that initiative.

I have seen entrepreneurs who have sold SMEs or stopped doing a business and move on to another business in which they have done better in the next business and then to the third business. None of the businesses failed. They feel that one business has run its shelf life and from now it’s going to become commoditized. So I’ll move on from this to another innings. Do that well till it becomes commoditized and then move to the third one right and when you see the third one if you see how they managed their business process, how they managed capital, how they managed surpluses in the business, how they managed investments in the business for growth. You can see a remarkable transition even when you converse with the entrepreneur. You clearly see how they learn from every venture and how they made it to a better place and whether the venture failed or succeeded, the learnings kept them going to a better place all the time. I think that’s very very critical. That’s the true blue spirit of entrepreneurship.’

Q13 Managing Gains and Creating Wealth as an Entrepreneur 

[Swami] (59:00 – 59:58)

Brilliant. My question Shyam in this discussion as we did a lot of research of your own philosophies of investing and how you looked at… I think you to me every time you came across like a almost like a contra-fund investor right so therefore you really looked at the contra trends that happened in the market. That seemed to be the way you looked at it and… so you actually made a statement which is which caught my attention and said staying rich with gains is not easy… okay so especially when you know an entrepreneur you know sells his exits with his capital… he gets a lot of money then managing the gains is not easy so typically what mistakes happen and what should they avoid?

[Shyam] (1:00:01 – 1:03:38)

Firstly when somebody sells a business then the whole world knows how much money they have made, what’s the kind of wealth they come into. as long as you are running the business no one is going to know. maybe they will do their own math but you know selling has a certain very clear signal to people that not only the money is there it’s available with this person. 

Generally when people come in to a lot of money there are going to be a number of opportunities that are going to chase them and not all of these opportunities suit them they are not meant for them because opportunities always chase capital, so when somebody comes into a lot of money opportunities are going to chase you. I have noticed that very successful entrepreneurs after selling their company have taken that money and become very ordinary investors in other companies. they have not had the skill to make investment successful. 

Whereas they were very skilled in running an enterprise successfully I think an entrepreneur who comes into a lot of money must understand this difference and he must purpose his wealth in such a way that his wealth must not be wrongly invested or wrongly allocated simply because he did not purpose it well. This is what happens with most of the people who come into a lot of money they think they have a lot of money and then they have the luxury of doing what they want with it. Within 5 to 10 years they realized that money was not actually a lot and they had not purposed it correctly. 

So again and again this purposing of wealth is very very critical especially when you are going to take out your lifetime wealth from an enterprise and you need to be very very careful about what you are going to do with it that’s the real test making that wealth in enterprise is actually easier part because you are doing the same thing with focus, you are not going to do 20 things. when you run a company you are running that company with utmost focus and effort and it’s actually a very narrow ecosystem that you made into a success but in the broad wide world, I think that the challenge is suddenly spike and entrepreneurs who sell businesses have always struggled under these challenges. because too many things come at them and many of the decisions they make turn out to be very very ordinary. 

So saying that I built a startup I made a lot of money even let’s say you made 30, 40 percent in your startup XARR and you sold is not a license for you to get the same result out of other entrepreneurs. It’s not a birthright it’s not a given it’s a totally different game and I think one should understand that.

[Swami] (1:03:41 – 1:04:06)

So therefore how would you suggest they allocate this… whatever you know pie that they get you know when you say you purpose the wealth you would say allocate a certain pie for investments, certain pie for you know managing their you know life needs so therefore there must be some you know top three four priorities on how will you share this pie right so it’s important for them to think through this right.

[Shyam] (1:04:07 – 1:06:22)

The first thing is how you want to live the rest of your life you provide for that because you have earned it. I mean after so many years of hard work you have created value in a business and you have monetized it money is with you so you decide how you want to live. The primary duty is to that quality of life which you want to give yourself. The next thing is what is it that you want to give for those who are going to be carrying your legacy forward… your children your family what I want to give them. that’s the second thing. and how are you going to give it to them in a way in which they are going to be able to carry it forward, that’s that secondary is something that you have to think because if you just say I’m giving it and it’s their headache if they don’t handle it well that problem is going to come back to you in your lifetime so it’s very very important that you handle not just what you want to have for your life with a certain foresight you also bring a lot of forethought into how your legacies are going to handle your legacy wealth that you are going to give them so that’s very important that’s the second part.

The third part is something where you are going to keep yourself busy because this is a problem… people want to keep themselves busy so some amount of capital is allocated to keeping yourself busy. I’ve seen some people get busy with philanthropy, so they allocate a section of capital for that and that keeps them busy so they don’t get back into business. broadly this is a very successful lot of people. I’ve seen I’ve seen very few people who failed there… most of the people have created impact. but where people want to get back into business and help other entrepreneurs. I think you need a structure you need a way of doing it you need to do it with more discipline than what you brought to your entrepreneurial innings and you should be finite about how much capital you are going to allocate towards that only then you would be able to carry that forward successfully.

Q14 Values & Belief Systems

[Swami] (1:06:26 – 1:07:12)

Brilliant, brilliant Shyam. Shyam I’m going to you know slightly move into some of your you know personal life skills that we read about and so you actually you know talked about in your early stages of your working life where you went and built a company you said for you you are an independent thinker with values and beliefs which you know so what what does that mean to you and how important is it in your in what you have built in the way you have built your organization the way you have built your work ethic how important is it and what are the learnings that you got out of that?

[Shyam] (1:07:13 – 1:10:29)

There are two areas from where I learned the first is, I come from business family which comes from the legacy era of licensing and stuff like that so the thought process of the previous generations are oriented towards an era of scarcity and how you thrive in that era. then I started working alongside people who wanted to get rich quick in the investment world. 

I have seen that other side also. in both cases I felt that the compromises which you need to do you need to do did not suit my personality, and I was convinced by somebody who mentored me without actually telling me that, that if you do what suits you you are comfortable doing that for a very long time and you will be able to find some niches where you are very good in delivering success. so the whole approach was okay I am not going to get into places where people are trying to run too fast or people are trying to do too many things to get their needs fulfilled and there should not be a need to do things which do not agree with you.

So if I have to avoid all this and do something then I should be independent and I should do something which I enjoy doing and I find it agreeable and it delivers to me. that is how this whole thing of doing something on my own happened otherwise I would have always been clipped on to some other person or some other company or entity or stuff like that and after I had done it for a reasonable period of time for myself I got offers from people whom I know very well socially, to do it for them and after I had done it reasonably well for a long time then I thought that what is the purpose of whatever I have learned if I cannot institutionalize it. 

And that is how this whole transition has happened there is no grand strategy it’s just doing what suits you and trying to do more of it and as you get more opportunity trying to do even more of it. so if opportunity comes my way I will do more if I don’t get I will just accept it. there is no goal driven that oh I want to get so much of revenue, so much of profit and nothing like that. so it’s just organic and it has grown over time because there are no pressures and there are no conditions and you operate in a way in which you are able to comfortably do it. that is what I have done.