Black Letter Day for Indian Startups and Entrepreneurs

On the morning of Monday, July 28, 2019, 60-year-old Veerappa Gangaia Siddhartha Hegde, commonly known as VG Siddhartha (VGS), departed from Bangalore, India’s garden city and IT capital, after informing his family that he was leaving. I left my home in Le. She went to her office and from Bangalore she drove to her family home in Sakleshpur, Hassan District, 221 kilometers away.

VGS is also the founder of Café Coffee Day, India’s largest homegrown coffee cafe chain, among others, and a prominent investor in Indian technology companies, including Infosys and Mindtree, the second largest listed companies by market capitalization. was.

Born into a family that owned coffee plantations and was in the coffee business for 140 years, VGS married Malavika Hegde, daughter of former Karnataka Chief Minister SM Krishna, in 1989. The couple has two sons from him named Amartya and Ishaan.

On this fateful day, VGS left home earlier than usual, arriving at 8:00 am instead of the usual 9:30 am, not surprising to Malavika and Krishna. They knew VGS would love to visit his hometown and his father’s coffee farm. VGS left the office for Saklespur at 11am. On the way, the VGS instructed the driver, Basavaraj his Patil, to steer a black Toyota He Innova instead of heading to Mangallu, about 130 kilometers from Saklespur. Scenic he drive from the capital of Karnataka to Sakleshpur along the NH75 highway, usually he takes 4-5 hours. This detour also required him a 3-4 hour drive.

At worst, one would have thought that VGS would have been cautiously optimistic. He sold his shares in Mindtree, ¥It made $326.9 million ($435 million) in revenue in March 2019. ¥$2.858 billion ($380 million).

In documents filed with the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), VGS’ flagship company, Coffee Day Enterprises Limited (CDEL), stated that the proceeds from the sale of MindTree’s shares were to be “Coffee Day used to “simplify group debt”. His CDEL consolidated debt as of March 31, 2019 was substantial. ¥7,269 kroner ($ billion)3, more than double the proceeds from the sale of Mindtree shares.

By 7pm, the Toyota Innova arrived at the Ullal Bridge over the Netravati River outside Mangaluru. VGS instructed Patil to drop him off at the bridge and return in an hour. When Patil returned, there were no signs of VGS.

He called his employer several times, but VGS’ mobile phone was turned off. A panicked Patil called his VGS family in Bengaluru and was instructed to immediately file a complaint with the local police station.

In his statement filed with the police, Patil said that the VGS called about 15 to 20 people while driving to Mangaluru and apologized to them. The driver admitted that VGS sounded agitated. Police launched a search under heavy media scrutiny.

On July 29, 2019, a letter of the type purported to be a suicide note was found on social media.

Suicide note goes viral

This memo, signed by VGS, shows the dejected state of mind of a man under pressure.

The memo included the following: Private Equity I gave up because I couldn’t stand the pressure from one of his partners and was forced to buy back shares. A lot of pressure from other lenders made me succumb to the situation. There has been a lot of harassment from his previous DG income tax in the form of a two-part consolidation of shares to block a deal with Mindtree, and then taking a position in Coffee Day stock. . My team, auditors and senior management have no knowledge of my transactions. I’ve been withholding this information from everyone, including my family, so the law should hold me and I alone responsible.

As expected, the letter went viral on social media.

Excerpted from Unfinished Business by Nandini Vijayaraghavan with permission of Penguin Random House India.