12 May, 2012, 07.04AM IST, The writer has posted comments on this article Ahona GhoshAhona Ghosh,ET Bureau
Shankar Sharma bids goodbye to Dalal Street for his start-up 'Cerebra'
MUMBAI: Shankar Sharma and wife Devina Mehra, founders of securities firm First Global, are set to bid adieu to Dalal Street and shift focus to their four-month young start-up, Cerebra BrainTech Pvt Ltd. The duo today spend almost all of their time on their technology and research-based venture that seeks to enhance mental capabilities as well as provide solutions for neurological disorders like autism, Alzheimer's, depression and schizophrenia.
"In the next few months, my trading and investing in stocks will be down to zero, that part of my life will be behind me," says the man who is renowned for his contrarian calls. "I will continue to analyse the markets because that is part of my DNA but I will not have the physical time to invest because Cerebra is a wide canvas and I don't have the mind space to do two very complex activities at the same time," adds Sharma.
The husband-wife team has invested 5 crore in Cerebra as seed capital and put together a team of 20. Sharma explains that he will need more capital to expand operations - to the Middle East and China - and make technology acquisitions to fuel research. "All my future investments will be linked to Cerebra in the space of technology and R&D," says Sharma. He recently invested in a US-based R&D company to develop technologies for Cerebra.
In simple terms, Cerebra's endeavour is to optimise the mental capabilities of individuals, from students to executives. The company's first offering, Cerebra TurboBrain, uses a technology - developed by an independent American scientist - that enhances cerebral blood flow, thereby boosting cognitive and emotional intelligence. A couple of other technologies are currently being clinically tested.
Cerebra uses technologies developed and patented by US scientists; in addition, it is working on adding its own enhancements to these technologies as well as developing the next generation of these technologies with assistance from scientists in the US and Europe.
Cerebra has chosen a cross-subsidisation model in a bid to accommodate patients from underprivileged backgrounds who will be supported by their well-heeled counterparts. Most of the patients - Cerebra has registered some 100 people for treatment so far - come from low-income families, points out Neeraj Khanna, a director at First Global and Cerebra. Khanna has worked with Sharma for the past 15 years, and is among one of the team members of First Global who stuck by Sharma through his difficult years.
Perhaps it's those difficult years, starting from 2001 when Sharma was hounded by the enforcement directorate and eventually taken into custody for alleged trading malpractices that have a part to play in his move away from the markets. One view was Sharma was paying the price for an investment in tehelka.com, which had exposed corruption in defense dealings. Sharma for his part is clear that it was a political vendetta against him by the then ruling NDA government.
Between 2001 and 2004, Sharma was summoned to court some 300 times and his home and office raided over 26 times. He spent 74 days in jail for an ostensible FERA violation - for not taking RBI's permission before doing business with FIIs. Sharma eventually got a clean chit, but the trauma isn't easy to forget. "FERA is the favourite weapon politicians use against their enemies. I thought at that time I would never get out," says Sharma recounting his time in Tihar jail. Adds Devina: "I had to go underground in case they arrested me as well. We had to keep the company running."
"If the BJP had continued in power, I would have either been killed or died of a stroke," says Sharma. After the 2004 general elections when the Congress came to power they were seen to be sympathetic to Sharma's plight. "I am a Congress supporter and am friends with the likes of Kapil Sibal and Mani Shankar Aiyar. They stood by me in my difficult days," says a typically candid Sharma.
Sharma survived, but the First Global franchise took a hit, as clients and employees took wing. Says Motilal Oswal, founder of the eponymous financial services firm: "He was absent from the market for some time and when you go through adverse conditions the business suffers a lot."
Those tough times mellowed Sharma, who was known for to be brash and even a bit rash pre-2001. Says Sanjay Sinha, founder of Citrus Advisors, and a childhood friend of Sharma: "He was very vocal with an aggressive attitude that has changed in the last four years. Perhaps the 2001 experience has mellowed him down."
In 2005, bang in the middle of their legal battles, Sharma had a change of heart about becoming a parent. Says Devina: "I always wanted children but Shankar was adamant about not having any; but he came around." Sharma reckons that the loneliness that comes with fighting battles got to him, and convinced him about the need to create a family. The couple's daughter Precia is now seven years old.
The couple, who have been working and living together for the past two decades - both are ex-Citibankers and met for the first time at the bank - say work never stops for them; it continues in conversations from office to home and right till bedtime. The only thing that has changed today is instead of discussing stock markets they talk about Cerebra and neurosciences.
But you still can't stop the man from talking markets. Sharma turned bullish in December last year, remains optimistic with high hopes on sectors like auto, consumer, public sector banks, infrastructure and pharma. His advice to retail investors: "Equity markets should not occupy more than 20-30% of your liquid net worth because in the long run equities will not give much returns and it's better to have a time horizon of two years, and no more, in this game." Big bull Rakesh Jhunjhunwala, who knows Sharma for the past five years or so and whose views have often clashed with those of the contrarian, says: "His views are intelligent and I respect them."
Sharma and his wife are no longer residents of India. "We made a decision in 2001 to become NRIs; it's a smart thing to do because the state can take everything you have away at the stroke of a pen," says Sharma. For six months a year, Sharma and family divide their time between Dubai and the US, where they have homes.
Clearly, Sharma and Mehra have been scarred by the tribulations of the past. And they live every day with the gnawing fear that trouble could be lurking at every bend of the road. "Every decision I take, I always look at my downside and exit options. Ordinarily you would never do anything from that perspective but once you go through an experience like that where the simplest of things can be questioned and made out to be capital offences then you have to think a hundred times," says Sharma, who was born in the coal township of Dhanbad in Jharkhand.
