• Inspiration

Thankfully, his work speaks for him. Otherwise, Dinesh Victor, MD, SIP Academy India and Sri Lanka, is so humble about his role in making his company the best in the area of skill-based education that you would think it’s been a cakewalk so far. What he isn’t underestimating, however, is the way SIP Academy has grown since 2003. With a turnover of Rs.10 crore, the firm has 650 franchisees in 19 Indian states. Over 1,50,000 children have passed out from the academy while cricketers such as Sreesanth swear by the Brain Gym inputs. With nearly 90 percent of franchisees being women, it has helped the women’s financial independence movement, too. “Women were a natural choice for our business model since they are far more committed to working with children,” says the 39-year-old.

The company, with its flagship programs of SIP Abacus and Brain Gym, is a subsidiary of a Malaysia-based company founded in 1993 by Kelvin Tham, who designed the courses to increase the mental ability of children with better attention, recall and so on. Other SIP Academy India programs— Global Art, MIKids phonics, AMAL and Orator English fluency program— were a far cry from what Victor was doing before he started SIP.

An IIM-A management graduate, he joined Godrej Soaps in the marketing division in 1994. After three years, he joined the retail arm of Standard Chartered Bank in Chennai. “Although it was a great learning experience, I didn’t necessarily agree with the working culture of such organizations that value numbers over people,” says Victor. He thus started a company similar to SIP with common friends in January 2002. But differences soon cropped up as Victor didn’t necessarily agree with the vision and values of his friends and decided to part ways. Not surprisingly, Victor’s family expected him to take up a job again. But that was not to be. For, his ears perked up when he heard one of his friend’s mother talk about SIP, Malaysia. “It seemed interesting and I took the plunge. It also looked reasonably easy to do,” smiles Victor. “If it didn’t work out, I could also go back to the corporate world.”

But, was it anything but easy? “It wasn’t. For one, we didn’t have the first-mover advantage,” he says. There were hardly any such classes for children other than a few, imparting computer courses or summer courses for theater, arts and dance. Victor had the tough task of creating demand for SIP’s course offerings, SIP Abacus and Brain Gym at that time. “It was concept selling at its best. I was sure that once I spoke to parents and stakeholders, they would warm up to the idea,” he reveals. With an investment of Rs.10 lakh, of which Rs.5 lakh was from his own savings and Rs.5 lakh was borrowed from a friend, Victor started the company. Marketing assistance was provided by the parent company in Malaysia. In August 2003, SIP Academy got its office in the
T Nagar area of Chennai on a rent of Rs.17,000 a month. Since the centers were franchisees, there was little investment needed for infrastructure. It was also the reason why the company broke even fairly quickly—in the first seven months.

The first three centers in Chennai opened in 2003, of which two continue to operate. The first outstation franchisee center was in Bengaluru, in September. It was slow in the beginning, until Victor was invited to Bengaluru for a center inauguration in 2003. After ads, the franchisee had to wait for just three hours. “Then came one parent who, it turned out, was related to the franchisee and was already sold on the idea,” laughs Victor.

There were other challenges, too. Capital, for instance. “But we were wise in conserving capital and had a very good finance person who knew how to make each rupee last longer,” he says. Financial crunch eased a little bit with Rs.10 lakh Citibank loan. The IIM-A degree held him in good stead, Victor feels. Then came overdrafts and banking channels offering loans without collateral.

“The biggest challenge was finding good area partners in the form of franchisees,” reminisces Victor. Then the added work of convincing a prospective franchisee on how it was a profitable venture. But as the existing franchisees started to make money, word of mouth became the most significant way of getting committed franchisees. In fact, it started with some parents turning teachers at the centers and then franchisees. The turnover for the first year of operations was Rs.1 crore and the company had 72 franchisees by March 2004.

Victor feels his biggest brand endorsements were children, who showed their skills and acumen in various competitions and got a lot of press coverage. “The media helped immensely with great responses to our press conferences in Hyderabad and Bengaluru, the two cities we were struggling to get traction,” he feels. With that, the demand for SIP classes grew, something that can be seen in the company’s turnover for 2004-05— Rs.1.74 crore.

Then Sri Lanka came calling. The Indian arm had been supporting the Sri Lankan operations in terms of training and resources, when the concerned person was moving out. Victor acquired 60 per cent of the organization in April, 2007. By the year end, it was a wholly-owned subsidiary. Currently running 22 centers in the southernmost country, Victor is also considering acquisitions in other countries but would rather talk about it when it does happen.

At SIP Academy India, he is also happy that the company’s work culture is exactly what he wanted it to be. “Words such as innovation don’t figure in our mission statement. It is more about building relationships, recognition, responsibility and continuous learning.” Nearly what most entrepreneurs live by.

©Entrepreneur October 2011

Tags:
Dinesh Victor, entrepreneurs, franchisee, mind game, Prerna Raturi, SIP