The importance of right hiring and right culture

In September 2016, Pramod Bhasin and Anil Chawla joined forces with AION Capital, a private-equity fund, to buy GE Capital’s commercial lending and leasing arms in India, forming

Clix

Capital, a non-banking financial company (

NBFC

). “We had to migrate to new technology,” recalls Bhavesh

Gupta

, who joined as CEO in February 2017, of the journey. They transitioned well. Two years on, Clix

Capital

is worth Rs 5,000 crore, with around 600 people in 10 locations, and 10 types of businesses (among them SME, vehicle, consumer, equipment and home finance).


How would you assess the health of the NBFC sector?

It’s a very important sector from an economic perspective which has grown massively in the last couple of years — the valuation of NBFCs grew, a lot of private-equity money came in and hence a lot of talent moved into NBFCs. There are certain areas that need to be fixed, like liability, management, credit quality, and from a regulatory standpoint enough action has been taken to fix it. In the next few months, the sector will get stronger. Also, those who do not follow strong practices will definitely be eliminated.

What tools do you use to understand clients?

We want to focus on building significant expertise in using

technology to be able to understand customers who may not necessarily have traditional mitigants, like income statements, bank statements, etc. We use many non-financial variables — it could be psychometric tests, telecom data, various surrogates like

utility bills, where you live, and what you do, what are you doing socially, etc. We create an algorithm and use it as a surrogate

to understand you. It is a fairly advanced science, and this is

the way new-age lending companies are doing business in China, US, Europe.

Do you think the push towards Digital India has been hasty?

I don’t think so — what the government has done has been fantastic. India is far ahead on the payments system, and that has been achieved by a very progressive government and regulatory policy, which is making more and more people go cashless. The amount of regulatory cholesterol on compliances that existed earlier has been reduced significantly. The only backward step revolves around Aadhaar. There is also a bit of stalemate on what the next step should be. But in my view, it’s temporary — we will find alternatives.

What are some of the important lessons you have learned in your startup journey?

The biggest learning is the kind of people you bring along in a startup — as your colleagues, peers, juniors. Assessment of those people has to be far deeper, in their readiness and hunger to be part of the startup. Abili-

ty to deal with chaos and work in an unstructured environment, are some of the attributes that are important for a startup to be successful. If you hire wrong, your process will slow down. Setting up the right culture is also important. Lastly, do a few things, otherwise you derail and fatigue the organisation by trying to build Rome in a day.