DARE - Because Entrepreneurs Do

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Srini Rajam walked into the Descartes Room of Ittiam Systems’ offices and noticed that someone had left his mobile phone lying on the long table. Like all of the rooms at Ittiam, the conference room was named after a philosopher, and on this typically balmy January day in Bangalore, Rajam was in something of a philosophical mood.

He noticed that the phone was a Nokia model, and the thought occurred to him that Nokia in a way represented his dreams for the venture he had co-founded in 2001. If a typical technically savvy person were asked to name a technology company in Finland, he surmised, he or she would think of Nokia. If one were asked to think of a technology company in India, he or she might think of Infosys, or of his old employer Wipro, the two leading giants in computer services, best known for business process outsourcing. Rajam had great respect for both, but in his lifetime, he also wanted to see India known for producing leading-edge technology. He and his co-founders had left Texas Instruments to pursue such a dream.

By early 2006, Ittiam had made a name for itself as a leader in a narrow but vital technology sector, intellectual property (converted into software) for digital signal processing (DSP) chips. Ittiam had been named the world’s most preferred supplier of intellectual property for DSP’s in a worldwide survey of DSP professionals in 2004, and that was something to be proud of. India had long attracted leading multinationals to locate R&D facilities in India, tapping into the country’s deep pool of technical talent; now, Indian-owned companies like Ittiam were gaining recognition as technology providers. Ittiam’s software underpinned some of the coolest consumer electronics devices on the markets, such as handheld media players and video phones that communicated over the Internet.

However, Ittiam itself was known only within the community of experts in digital signal processing applications. Rajam dreamed that just as Nokia had made Finnish technical prowess well-known, Ittiam would help the words “made in India” stand for cutting-edge, excellent technology. In the longer run, Rajam wondered, how would the firm have to evolve to realize this vision?

Ittiam’s growth to 2006
Srini Rajam had been influenced by some successful entrepreneurs he had met early in his career, but he did not seriously begin to think about starting a company until 2000, some 15 years after he had joined Texas Instruments. He muses:

“I come from a typical middle-class family, and most of the Ittiam founding team is like that. A new breed of entrepreneurs in India is starting up with absolutely no family background in doing business. You can call us the zero generation of entrepreneurs, since there is no track record of entrepreneurship in the family. My brother is a senior vice president with a Japanese company; my sister is a housewife; almost all the Rajams are employed by other people. India has some traditional entrepreneurial communities, for example the state of Gujarat, whose people often become entrepreneurs by default. Southern India, in general, has not been very strong in such traditional entrepreneurship, but people like Narayana Murthy have broken that stereotype. Most
people like him came from the conservative middle class where the best thing is to get a good job, preferably a government job.”

Ittiam was founded in early 2001 by five engineers who had many years of experience working with one another at Texas Instruments (TI). Rajam stepped down as Managing Director of TI India to start the company, and was joined by Andrew Bhagyanathan, Sattam Dasgupta, Ravishanker Ganesan, and Shantanu Jha. Two other former TI colleagues, Rohit Buva and Vikram Bose, joined soon after, and the seven formed a close-knit management team throughout Ittiam’s first five years. Their shareholdings, along with that of the people of Ittiam (referred to as Ittians), constituted a majority of Ittiam’s equity in 2006.

Each of the five original founders put in some seed capital to launch the enterprise, which they named “Ittiam” as an acronym for René Descartes famous assertion, “I Think, Therefore I Am.” The name was meant to convey what each founder saw as Ittiam’s fundamental competitive advantage: the brainpower of its people. Ittiam had nothing to sell except the product of pure thought, its intellectual property. The team rented a business center, started basic programming operations, began looking for clients, and put advertisements in the paper seeking skilled employees. Rajam recalls:

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