Nurturing the Next Generation of Business Leaders: A Balancing Act

Engaging the Next Gen: Beyond Entitlement

Harsh Mariwala, chairman of Marico Ltd., believes that fostering a strong entrepreneurial spirit in the next generation of business families requires early engagement and a balanced approach. This means exposing young family members to the realities of business, from factory floors to bustling marketplaces, instilling a deep understanding of the hard work and dedication required for success. Mariwala himself practices this philosophy with his own grandchildren.

Crucially, Mariwala emphasizes the importance of dismantling the "entitlement mindset." He firmly believes that simply being born into a business family shouldn't guarantee a leadership role. Instead, young family members should earn their place through hard work and demonstrated capability.

"Simplicity is required for youngsters to grow up; you can't give them everything on a platter. They have to put in the hard work to succeed," Mariwala stated at the Mint India Investment Summit in Mumbai.

Beyond the Family Business: Exploring New Avenues

While encouraging involvement in the family business, Mariwala also advocates for allowing the next generation to explore their own passions, whether it's working with dynamic startups, navigating the world of unlisted deals, or contributing to society through philanthropy.

Mariwala's own family office, Sharrp Ventures, established in 2015, exemplifies this diversified approach. Managed by his son, Rishabh Mariwala, the firm invests in a range of assets, including public and private market funds, with a particular focus on direct investments in unlisted, consumer-facing enterprises.

"For me, a family office extends beyond stock market investments," Mariwala explained. "It encompasses a wider range of activities, including investing in and scaling unlisted companies, managing taxes, and engaging in philanthropy."

Navigating Disruption in the FMCG Sector

Mariwala acknowledges the significant challenges facing the fast-moving consumer goods (FMCG) sector, traditionally considered a defensive market. The rise of direct-to-consumer (D2C) brands, coupled with evolving distribution channels and emerging technologies, has disrupted the competitive landscape.

He highlights the changing dynamics of market entry, noting how D2C brands can bypass the traditionally high costs of building nationwide distribution networks and large-scale advertising campaigns, leveraging e-commerce to reach consumers more efficiently.

"Each and every business is getting disrupted," Mariwala observes. "The key thing for any business to do is to evaluate how sound their business is and what is disrupting them and whether it is an opportunity or a threat."

Embracing the D2C Revolution

Rather than shying away from these challenges, Marico has proactively embraced the D2C revolution by acquiring several digital-first brands, including Just Herbs, True Elements, Plix, and Beardo, and launching its own. This strategic move positions Marico to become a major player in the D2C space.

Mariwala expressed confidence in Marico's approach, saying "We said we have to look at it from an opportunity perspective. The way we are going—we would be one of the largest D2C players in the country."

While acknowledging the financial losses experienced by many private equity-funded D2C brands, Mariwala believes that Marico can leverage economies of scale across its acquired brands to achieve profitability and deliver similar returns to their established FMCG brands.