A good founder prioritizes taking calculated risks while ensuring a sound balance sheet.
Conversation with Sagar Khatri, Co-founder & CEO @ Multiplier
My guest this week is Sagar Khatri, co-Founder & CEO of Multiplier, a leading global workforce management platform that makes it easy for companies to employ teams internationally. Recently featured in Forbes 30 under 30 list, Sagar’s journey has been nothing short of extraordinary. Emerging from humble beginnings in India, he has consistently pursued a singular mission in life: to create something impactful and meaningful, to make the world a better place for everyone. Graduated from the top engineering university in India - Indian Institute of Technology, Bombay, Sagar began his career at the prestigious investment bank Nomura, where he provided counsel to numerous companies across the Asia-Pacific region. A fortunate encounter with a Sequoia Capital investor marked the beginning of his entrepreneurial journey, initially with Hmlet before embarking on his own venture.
Sagar's motivation for founding Multiplier stemmed from his personal experiences with the challenges and complexities of international expansion he experienced firsthand at Hmlet (recently rebranded as Habyt). He sought to alleviate the very pains he had once endured, ultimately making business expansion across borders significantly more accessible.
In this interview, we delve deep into Sagar's inspiring personal journey and uncover the secret ingredients of his success. Sagar generously shares his invaluable insights on scaling a business, along with the unique people and cultural practices he has pioneered and implemented within his company. Finally, he imparts insightful tips for fellow founders on navigating the current uncertain climate, striking a balance between taking risks and making bets.
A good founder prioritizes taking calculated risks while ensuring a sound balance sheet.
Watch/listen to the full podcast HERE.
Jerry: Sagar, I feel incredibly honored to speak to you today and huge congrats on the recent Forbes feature. It’s truly an impressive achievement. Before we dive into your exciting adventure, what is your story and how did you get to where you are today?
Sagar: Thank you, Jerry, for your kind words. I come from very humble beginnings. I was born in Nagpur, India. My family's roots trace back to northern India, and they were originally refugees who fled from Pakistan. My grandparents and their generation had to build everything from scratch to create a new life for themselves.
Growing up, my sole aspiration was to escape poverty and achieve financial success. For some, they have choices, but when you're born into poverty, there's only one path forward. This is what fueled my relentless drive and work ethic. My journey began with university, where I worked tirelessly to secure a spot at one of the best schools in the country. I excelled in mathematics, which led me to the Indian Institute of Technology, the best engineering school in India.
Although my background was in engineering, I realized that the banking industry offered greater financial rewards. So, my career began at Nomura, where I worked in business strategy and deal advisory across the Asia-Pacific region.
Then fate would have it, just when I was contemplating my MBA studies, I crossed paths with Rohit Agarwal, an investor at Sequoia Capital. This encounter marked the beginning of my entrepreneurial journey. I chose to work for a startup instead of pursuing an MBA to gain real-life lessons. I was the right-hand man to the CEO in building Hmlet, a co-living company catering to international professionals seeking to balance their lifestyles, finances, and connections.
During this time, I encountered firsthand challenges of international expansion. Registering legal entities, opening bank accounts, hiring, and navigating tax requirements were excruciatingly complex and time-consuming processes. Some countries even had unique regulations that prolonged the process for months. This experience was the birth of the idea for Multiplier – a solution to streamline and accelerate business expansion.
Fast forward to today, I'm delighted to see the remarkable success Multiplier has achieved in just 2.5 years. Our mission continues to be building the best-in-class Employee of Record (EOR) platform.
Now, you asked about my secret ingredients. I'd summarize them in three key elements:
First, my relentless drive, which has often bordered on insecurity and paranoia. I constantly seek to prove myself to the world because of my challenging upbringing. This drive is a double-edged sword; while it fuels me, sometimes I also find it slows down my pace for being insecure and paranoid at decision-making.
Second, hard work. Witnessing my family's history of building everything from scratch instilled a deep respect for hard work. It comes natural to me, and I've had to work twice or even thrice as hard as others to reach the starting line in everything I do.
Lastly, humility. Perhaps influenced by Eastern culture, I was taught to emphasize the importance of staying humble. Confidence is essential, but not to the point of arrogance. There's always someone better to learn from.
Jerry: Thank you, Sagar, for sharing your inspiring journey. Let's explore the scaling lessons you've learned. What advice can you give to fellow founders?
Sagar: For me, it's about balancing speed, hiring great talent, and taking calculated risks. Looking back, I believe we could have moved even faster. Decisions I made earlier could have led us to expand into certain regions sooner. In our highly competitive industry, speed often correlates with growth opportunities.
However, moving fast requires great people. For example, I relocated my co-founder to New York to tap into a more experienced B2B talent pool in the U.S., a significant market for us. Hiring is never easy; it involves continuous trial and error. Learning from these experiences is crucial.
Lastly, always take calculated risks. As Jeff Bezos once said in Amazon Unbound: Jeff Bezos and the Invention of a Global Empire, “Good entrepreneurs systematically avoid risks at every phase of the company.” Especially in the early stages of a startup, where risk is inherent, it's vital to minimize foreseeable risks.
Some companies spend recklessly during periods of success, only to realize the importance of prudent asset management during downturns. I prioritize taking calculated risks while ensuring a sound balance sheet. This discipline is a critical aspect of a CEO's role, requiring self-discipline and diligence, qualities every founder should possess.
Ram Charan wrote in What the CEO Wants You to Know: How Your Company Really Works, "Many people focus on profit margin but overlook velocity. Here’s what makes successful CEOs different from many other executives: they think about both margin and velocity. This dual focus is the centerpiece of understanding how a business truly works."
Jerry: The Employee of Record (EOR) business has gained significant momentum, especially since the COVID-19 pandemic. The space is now crowded with competitors. What sets Multiplier apart, and what trends do you see in the industry as remote work recedes and companies return to the office?
Sagar: Firstly, the EOR service didn't emerge solely due to COVID-19. Remote work certainly accelerated its growth, but companies like G-P/Globalization Partners have existed for a long time. The industry addresses a validated market need that has always been present.
I prefer to call it "glomote" rather than remote because global expansion is an inevitable step for companies seeking to scale. As long as this need persists, the demand for our services remains, whether companies require physical offices or not. Adapting to trends and pivoting product offerings is essential. Continuously striving to create something genuinely beneficial to customers is our priority.
As for what sets Multiplier apart, I'd humbly say we currently offer the best product in the market. Being founded in India provides us access to high-quality engineers, talents, and resources in one of the world's fastest-growing tech hubs. Additionally, our advantage in the APAC markets allows us to provide more customized solutions and better understanding of the market compared to many North American players.
Jerry: Could you describe the working culture at Multiplier?
Sagar: We're in an exciting space on an exciting journey. Diversity is a core value within our company, with employees from 65 different nationalities. We seek individuals who share our drive, are highly self-motivated, value transparency, and contribute ideas.
As Steve Jobs nicely puts it, “The only way you can keep retaining top talents is to create an environment where they can win with their ideas not hierarchies!” This has been my motto and we have also created an environment where the best ideas prevail, irrespective of hierarchy. Everyone, regardless of rank or seniority, can challenge the status quo. This philosophy fosters an atmosphere where talents stay and thrive. We offer full autonomy, making it an ideal place for entrepreneurial spirits looking to make a real-time impact.
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