Vice chairman of the 118-year-old Arvind Mafatlal Group, managing director of Mafatlal Industries Limited (one of India’s oldest textile companies) and executive director of NOCIL Limited (India's largest manufacturer and supplier of rubber chemicals), Priyavrata Mafatlal is a fifth-generation entrepreneur with his mind set on ensuring legacy and spearheading change through alternative growth strategies.
Under Priyavrata’s leadership, the Arvind Mafatlal Group has expanded into EdTech, health and hygiene and the information technology space. Additionally, he is a successful angel investor and has added significant value to the start-up eco-system in India.
Ahead of chairing Campden Family Connect’s Indian Family Alternative Investment Forum on Tuesday, August 23, Priyavrata talks exclusively to Campden FB about diversifying into alternative investments, honouring legacy and the advice he’d give his younger self.
We understand that alternative investment as an asset class is extremely risky, but it also offers that additional financial alpha.
The theme of this year’s Indian Family Alternative Investment Forum is ‘Exploring new-age alternatives’, what was the thinking behind your own family office’s decision to diversify into alternative investments?
Alternative Investment as an asset class has always formed a part of our core portfolio, albeit with limited exposure. Coming from an entrepreneurial background, we believe in taking risks and venturing into challenging territories. We do understand that alternative investment as an asset class is extremely risky (as compared to other opportunities) and is relatively illiquid, but it also offers that additional financial alpha. Additionally, one of the biggest intangible advantages of participating in this asset class is that it offers some great insights from different entrepreneurs, their experiences, learnings, journey and so on.
You come from an 118-year-old multi-generational family, how important is adaptability and open-mindedness to alternative investments to your continuing success?
Without open-mindedness and adaptability, individuals or organisations struggle to grow and thrive successfully. Today since alternatives as an asset class allows us to work very closely with the founders and entrepreneurs, we end up getting a lot of exposure to new-age ideas and innovations. But the Arvind Mafatlal Group has been around for more than a century because of our need for constant innovation and us wanting to push our abilities to constantly adapt to newer businesses, techniques and opportunities. While the term ‘Alternative investments’ has picked momentum in the past 10-12 years, the group has always aggressively looked at diversification, often as first-movers, into areas which may or may not even be close to our core businesses. Invariably, as a group, we have always participated, directly or indirectly, in the alternatives asset class and we will continue to support the entire eco-system.
In a flowing river, there’s no such thing as floating - we either swim upstream or the current will take us downstream.
As vice chairman of the Arvind Mafatlal Group and managing director of Mafatlal Industries Limited, one of India’s oldest textile companies, how do you balance honouring legacy with keeping an open mind on new opportunities?
In a flowing river, there’s no such thing as floating - we either swim upstream or the current will take us downstream. I look at legacy as a responsibility and opportunity to build on from, rather than sit back comfortably and get bound by older methods and ways of doing business. Taking risks by entering newer opportunities has been a strong component in the group’s DNA and philosophy which I have inherited. While the group continues to remain synonymous with textiles and rubber chemicals, in the past five years alone we have forayed into EdTech, industrial laundry and dry cleaning, health and hygiene and IT solutions to name a few. It's also very important to surround ourselves with the right people, both internally and externally, who help in constantly spotting and identifying upcoming trends and megatrends.
What would you advise to family offices looking to get into alternative investments, such as crypto or digital assets, but don’t know where to start?
While crypto and digital assets are still at a very nascent stage, not only in India but globally, this industry is picking up quite rapidly and cannot be ignored. The environment is constantly evolving in terms of business and product fit, regulatory frameworks, stakeholders being divided upon the taxability and so on. So when we have so many moving pieces and very limited experience, it becomes really difficult for family offices to pick the right companies in this space, and, in such situations, it’s always better to participate through a fund structure rather than taking direct exposure in any company. We believe these fund managers are closely watching this space and its best to rely on their assessment until we build confidence and expertise.
You were recently awarded ‘Family Office Personality of the Year’, how does it feel being the face of not only your own family but also held up as a paragon of doing right?
It obviously feels nice when the world recognises you for your efforts, but leadership is earned, it’s not a right. We believe that we carry a lot of responsibility in every action or decision we take and, for us, ethics and governance is always at the forefront. The group’s ethos is “Ethics of excellence” and we are always mindful of the fact that we carry a rich legacy which needs to be preserved - nothing is more valuable to us than the trust of our stakeholders. So in every business dealing, we put the right heart and mind at work considering the larger responsibility that we carry and we owe this success to the blessings of our forefathers.
What advice would you give to your younger self?
Don’t take life so seriously. Work and career is important but ensure finding time for health, family and friends and oneself. Travel when you can, it builds perspective. Be bold, be brave and don’t shy away from taking decisions - trust yourself. There are no right or wrong decisions, if we choose to learn from the outcomes of that decision. Acknowledge life’s ups and downs and enjoy the ride.
For further information on Campden Family Connect’s Indian Family Alternative Investment Forum, running on Tuesday, August 23, email email@example.com.