Risk-taking set Coffee Day founder apart

Dabbling in stocks and managing portfolios of clients as a trainee in Mumbai in 1980 to a restless entrepreneur, who successfully built a business empire worth crores, the rise of V G Siddhartha, promoter of Cafe Coffee Day, may read like any business tycoon’s success story.

But his sagacious investment decisions and willingness to play with risks made him a cut above the rest.

Making a modest beginning in 1984 as a stockbroker with his Sivan Securities on Church Street in Bengaluru, Siddhartha was perhaps one of the few market watchers who foresaw a profit in the IT industry which was at its nascent stage then.

Investing a few lakhs borrowed from his planter father when heading to Mumbai, Siddhartha stunned many with fat returns in less than five years.

Unlike others, who may have chosen to release it back into the market, Siddhartha, with his agricultural background, chose to invest in agricultural land and added about 1,500 acres to the family’s already existing 500 acres. By early the 1990s, the family-owned a plantation of whopping 4,000 acres.

With coffee trading liberalised around the same time, Siddhartha forayed into coffee trading and set up coffee procurement centres across Malnad by floating the Amalgamated Bean Coffee (ABC) with over 500 centres in two years.

German inspiration

It went on to become India’s largest coffee exporter. Inspired by a German chain of coffee retailers, Siddhartha launched his Café Coffee Day in Bengaluru and began selling coffee, space and internet — a perfect place for youngsters to socialise and hang around in an urban landscape.

The venture with more than 2,000 stores around the globe, provided a livelihood to thousands of semi-educated and skilled youngsters from Karnataka.

Buoyed by the success of his company’s coffee sales, Siddhartha continued with his investment in IT and ITES services in the stock market. With India surfing high on the IT boom and promising returns for investment, all these days, Siddhartha developed an interest in running his own IT company.

Siddhartha’s association with market leaders like, Ashok Soota, Subroto Bagchi, Rostow Ravanan and K K Natarajan led to the creation of Global Village Technology Park near Kengeri that housed MindTree IT and Consulting Company.

Until a few months ago, Siddhartha was the largest shareholder of the company. Soon, he acquired his earlier Sivan Securities and relaunched it as Way2Wealth investment consulting firm.

Coffee Day hotels

Tasting success with his expanding business empire, Siddhartha forayed into the burgeoning hospitality industry and launched Coffee Day Hotels and Resorts under the banner of The Serai in exotic locations of Malnad, Kabini backwaters and Havelock Islands of the Andamans. In 2006, he helped Café Coffee Day grow beyond Indian frontiers and forayed into the European market with quality and affordability as its strengths against the giant market leaders.

By then, converting everything that came his way into a profitable venture, Siddhartha managed to win timber contracts in Guyana and other contracts and ventured into furniture manufacturing with Chetan Wood Processing (named after his native village Chetanahalli) and Dark Forest Furniture Company (named after his coffee estate Kattale Kaadu) in Chikkamagaluru.

Success story

Weaving a success story with his presence in multiple sectors, Siddhartha’s hard times began in 2017 when Income Tax sleuths raided about 20 locations across India linked to him and his business house.

Amid mounting debts and promise to return the borrowed money, he even gave away his shares with MindTree. Working overtime and reportedly switching political loyalties of the family to turn the tide in his favour, Siddhartha continued to stare at mounting debts.