NR Narayana Murthy says IPOs come with huge responsibilities

Infosys co-founder N R Narayana Murthy on Friday said there is a certain kind of pressure on entrepreneurs in India to succeed as early as possible.

Published: 04th June 2022 07:19 AM  |   Last Updated: 04th June 2022 07:19 AM   |  A+A-

Infosys founder Narayana Murthy (File photo| Reuters)

Infosys founder Narayana Murthy (File photo| Reuters)

By Express News Service

BENGALURU:  Infosys co-founder NR Narayana Murthy on Friday said there is a certain kind of pressure on entrepreneurs in India to succeed as early as possible. “We, in India, have not done a good job of estimating the market size. We have traditionally overestimated the market. We probably do not have good market research companies that can give us an accurate estimate of the market opportunities,” Murthy said.

Speaking at the India Global Innovation Connect held in Bengaluru on Friday, Murthy, who is also the founder and chairman of Catamaran Ventures, said IPOs have somehow been taken as a surrogate for the next round of financing. “I think that’s not a good thing because an IPO comes with tremendous responsibilities,” he said. “With pressure from VCs (venture capitalists), looking at IPOs as the next round of financing and finally, the inability to estimate the market size-  invariably your cost goes up, but not revenues. Therefore, you make losses,” he added.

He recalled the day when Infosys made an IPO in February 1993. Last year, 63 companies went public and mopped up `1.2 lakh crore through the IPOs. Addressing entrepreneurs, Murthy said disclosing bad news (about the company) is transparency and not hiding it. He said it is always best to bring bad news early and proactively. “If you don’t do that you will not be able to sleep well and there is always an anxiety in other parties’ minds because they also have sources to get some access to information. So, my view is that always bring bad news early and proactively,” he added.

The Infosys co-founder also said that the success of an entrepreneur comes because of market access, the second ingredient is access to talent, and the third ingredient is VC money, which is easily available today.



Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp