I had read that your decision to part with a large share of your income and spend it on charity?
Yes. And I am not donating a big part, but almost the entire part. I have decided to put the money up for charity in areas of health, education, disability and water projects through over 150 NGOs. However, we often face trouble in this area too.
But why you want to do this?
I thought about what I eventually want. I have made a lot of money in the West…(and) I do not believe in much of personal consumption. What will I do with this money? Some people have hobbies that involve large personal consumption. I don’t have expensive hobbies. People ask me why I don’t own a second house, and I tell them I have enough problems with my first house. I do not have a hobby. My son is 22 years old, and he thinks like me only, since he believes that one must stand on his own feet. He is pursuing a job in the private sector right now. Why would I take on more headaches? So I really only have two choices. I can either do something for others, or I can wreck my son’s life by giving him money. That doesn’t seem like much of a choice.
So how are you going to spend this huge money?
I have set up a non-profit organisation, Hans Foundation, for charity work and we will be spending Rs 5k crore on charity in 10 years. The foundation has funded more than 300 charity projects including some big ones like Kamala Nehru Memorial Hospital for cancer treatment to the poor so far.
You came from a well to do family and there was no shortage of material possessions. Can handling this kind of wealth be difficult for people at times?
I was in school for nearly 12 years. After school I thought about the reasons why one needs to earn money. What should one do with it? That “You tie a craftsman’s hands telling him to show his workmanship, and then call him an underachiever” thought kept me occupied for a long time. Everyone has different kind of goals. I am not a show off and I do not have a thing for too many material possessions. There’s a saying in our land, that we don’t spend time, time spends us. We don’t indulge, indulgence indulges us. Still, if someone doesn’t learn and isn’t careful, he can’t be called intelligent.
You have deep interests in meditation and other spiritual practices. You lived in an ashram as a young sadhu and you’ve devoted many years of your life to meditation. Has it encouraged you to go for the service of humanity and your approach to philanthropy?
On the personal side, my spiritual training taught me that excessive consumption can only harm you. The simpler your life is, the better off you are. The business and the work side is a lot more complicated. But I believe that if you have wealth, then you have a duty to go out and use it for the benefit of others. That probably also comes from my training. I still continue the same spiritual practice, so life hasn’t changed incredibly for me because the discipline is pretty much the same. And I found out I’m pretty good at business. For me, doing business and then giving money away is not so different from being a monk, because in both cases you’re working for others.
What is your idea about philanthropy?
Putting my name on buildings is not my definition of philanthropy. I focus on human suffering, and you know suffering when you see it. For example, Princeton University called me up and asked for money. I told them: “Look, I don’t want to waste your time but I don’t give money to the rich.” You have to look at the needs out there rather than sitting behind a desk and saying this is what we’re going to give them. Incredibly, a huge chunk of philanthropy isn’t about that.
So, how do you identify the needy people?
We do philanthropy by going out into the field and finding out what people need. If a guy’s starving you don’t give him an education. First he has to eat; otherwise he’s going to be dead. The most common mistake philanthropists make is failing to understand that it’s not about you. It’s about the customer. That’s pretty obvious in business. Yet so much philanthropy is driven by fashion. Today’s fashion is sustainability. Who made that rule? It really is about customer need. If the guy needs food he needs food now. Whatever he needs, that’s what the goal should be, not sustainability.
You have funded 150 NGOs in Rural India. How do you identify the NGOs and their projects for funding?
It’s very simple. We check out each charity to see if they’re doing a good job. Then we adopt them or fund them. And then we check every year to make sure they’re not stealing the money. If they’re doing a decent job, we keep funding them. Three or four years from now we expect to have adopted about 400 charities. Our approach is to adopt people who are doing a great job. Currently we’ve adopted around 150 charities. Through them, we affect the lives of about 600,000 people per total projects. We are building four hospitals in India. We’re funding school lunch programs, because in India there are tens of thousands of kids who only go to school because there’s a free lunch. We also fund programs that teach women how to take care of themselves in business.
What are the problems or challenges you face in doing philanthropy in India?
The bottleneck is recruiting. Most of the mistakes that I’ve made in business and philanthropy have to do with hiring the wrong people. We’re charity wholesalers, so we need to find retailers who can go into the trenches and actually do the work. Sometimes we hire people who turn out to be about themselves, not the poor. Sometimes they turn out to be incompetent. Hiring is not a science. It’s still an art.
Please tell us something about your life’s journey from India to the US?
I would prefer to say little because; I have had little attachment to my personal life. I was born in Lucknow and studied at the Mahanagar School till class 6. After that, my father decided to send me abroad. So for preparations, I spent three years in Mussoorie, while my Dad went there in 1965 only. My father had a big publishing business there. It was called Upper India Publishing House, which published books taught in various colleges. My father had written many books under the Bharagava Dey name. But with time, everything went downhill, though he was still among the top people in Lucknow. Our grandfather was a leader from the Awadh region. He used to get many hand-written letters from Mahatma Gandhi, who had also sought the help of our grandfather in those days. Even after out grandfather’s demise, many leaders from various political parties used to come home. That’s all more or less how it was. Afterwards, we moved to Philadelphia in the US, and I finished my education from there.
How was your initial experience in the US? Were things smooth from the beginning?
Taking money abroad was not allowed in those days. We had nothing when we reached there, but we were very happy and made up our mind to work hard. A new beginning had to be made all over again. We started from zero again. Everyone finished their education there, and except me, everybody got a graduate degree. I think that there are two types of education. One is just to take a degree. And then begins the second type of study – the study of life. Bookish studies do not pay much; they act as only a base in life. Then you have to build your own house on that. If you study at IIT and IIMs and still don’t know much about life, what is the use of such an education?
You are the richest Indian in America. How did this success come about?
We create an energy drink, which we call 5-Hour Energy. If you’re tired, you can take it and your exhaustion will disappear. It works for five hours, and after that you will return to your normal state. Last year, in the US, we sold 40 crore (400 Million) bottles of this drink. It costs $3 per bottle, or nearly Rs.165. I thought that if I am doing something, it has to be special. To make something new and special, you have to invest a lot of time and energy. So after looking at nearly two thousand inventions, we decided to start this business. We kept on improving it. Today, the sixth generation of ‘5-Hour Energy’ is out in the market. The turnover of our business today is around a $1.2 billion at retail.
Being a non-US trader, was the competition tough?
(Smiling) Yes, it was tough, but you just have to have common sense and work through the problems with clarity to compete effectively.
When it comes to foreign investors, especially Americans, which market do they prefer to invest in – India or China? And why?
The question is not so easy. In some cases, it’s better to invest here. India has the basic infrastructure to set up industry. But red tape is rampant here. In China, on the other hand, investors have this internal fear that the Chinese government might nationalise everything. So they don’t trust the government there. It might be giving all the facilities today, but it can take all of this tomorrow. So investors generally balance out their options.