CHAIRMAN AND CEO, NETSOL
TECHNOLOGIES INC. (NTWK)
Headquarters: Calabasas, CA
by David Wurth
Najeeb Ghauri is the Founder and CEO of Netsol Technologies (NTWK), a publicly held global IT firm located in Calabasas. The definition of a gentleman, this Pakistani-American quarterbacks the thousand plus employees located around the world from a small, five office space across from the Calabasas Commons. Nominee for the Ernst & Young Entrepreneur of the Year award, Najeeb took Netsol to the Nasdaq in 2001 and was the first Pakistani – American ever to do so. Sharply dressed and favoring a Cartier Tank over the standard Executive Rolex, Najeeb has his finger on the pulse of international business and a strong family life. After spending years dreaming of living in the Oaks Community in Calabasas he reached that goal and now lives in the community he has always hoped to with his wife and two children. Walking to the office is not out of the question, as keeping a healthy non-drinking and active regiment is priority amidst his rigorous corporate schedule. As we sat down for the interview, plans were being finalized for his multi-legged trip to Chicago, New York, and Texas; he was leaving for the airport directly from the interview. Mr. Najeeb Ghauri is quite the personality in front of the brains and is an asset to any organization or conversation. His story runs deep and parallels the trials and tribulations of many immigrants’ experiences in this land of opportunity. It was the struggle with himself early on, as well as his resilience to overcome a striking challenge in business that will allow anyone to respect, relate and revere his accomplishments. Najeeb walks us through his path, highlighting challenges along the way, which helped him (and might help you) to further recognize the keys to success.
In 1976, Najeeb Ghauri was an outgoing 17 year old in Pakistan’s second largest town of Lahore. He was surrounded by eight siblings and parents that strived to provide the best possible education for all of their children. Najeeb was an average student at best, distracted easily by his social life, “I wanted to do well but I didn’t,” he says, easily resonating with both the students and parents in the Los Angeles Uptown area. So when he approached his parents with the desire to get a higher education in America, his father snubbed, “If you don’t do well in Pakistan, how will you do well in the US?” His father continued to question Najeeb’s intentions. The majority of Najeeb’s siblings were off to London to study, including three of his brothers and co-founders of Netsol Technologies. “My own ego said that I could do it and my mother whom, as well as my father, was a major mentor in my life, knew that if I wanted something bad enough I could accomplish it.” Najeeb’s resiliency took over at that point for it was almost one year and six attempts before he finally received his Visa from the US Embassy. Najeeb lives by the mantra that if you want something bad enough, you have to be willing to sacrifice. This motto becomes more revealing as Najeeb continues to find his way to where he now sits.
"I finally landed in Illinois for my college…all of the sudden, a boy who was very mediocre (C level student) was thrown into an All-American culture with very sharp kids." Fortunately Najeeb never really battled with the English language as it was emphasized throughout the school systems in Pakistan. Writing was never too challenging for him either, the problem was his inability to focus. His distraction began shifting after a semester in the US. “I started doing things differently,” as he started thinking about things differently as well. Najeeb finally graduated undergrad and his path started to quickly unfold as he was admitted to the Drucker School MBA program at Claremont Graduate University in California. Najeeb dedicated his mind to succeeding academically, as was his challenge throughout childhood, and accomplished just that. This was a pivotal moment of clarity as, although he always knew that he could, Najeeb finally proved to himself and his family that anything was possible.
While working his way through graduate school in Southern California with a B+ average, lining his pockets with some spending money became extremely important. This philosophy was somewhat radical in the minds of his family because culturally in Pakistan it is unorthodox to work while one studies. “That was hard to digest for people, especially because I would study ten to twelve hours a day then work my part time job driving a cab at night.” In 1981, Najeeb graduated from Claremont Graduate University and was now stuck between a rock and hard place. An MBA graduate driving a cab didn’t make much sense, and although opportunities opened up, it was a challenge having a student Visa and finding a promising position with a recognizable company willing to sponsor his green card the legal way. It is not in Najeeb’s moral fabric to consider the alternative. “My father had a good business in London and asked me to come back.” Najeeb said no as he was driven to make a footprint here in the US. He had made it from an average student and barely making it, to successfully graduating from an MBA program at Claremont. As Najeeb puts it, “this was a very big achievement…my family was shocked that I did it.” In addition to proving to his family and to himself that academically he could do it, it was time to find placement amongst an extremely competitive talent pool in a corporate system that wasn’t yet that encouraging to Pakistani immigrants. “I worked for Metropolitan Life selling insurance. I was very good actually…I have some sales skills which were hidden.” Najeeb worked two years at Met Life as they helped him get his Green Card, giving him a lot more leverage and bargaining power when looking for another position. Ironically, Najeeb found a position as Brand Manager for a company in the UK and Pakistan. He left the US for three years. It wasn’t until meeting one of the oil industry’s most powerful leaders, who would also become one of Najeeb’s most influential mentors, that Najeeb began to switch gears and make his way back to the US.
Armand Hammer, founder and former CEO of Occidental Petroleum (OXY), “was really influential in my life,” Najeeb says with reverence, “he was a noble man that knew my wife’s family.” Mr. Hammer made a difference in the third world, respected by many, and helped mentor Najeeb into the oil business. Najeeb knew the oil companies well and had extensive knowledge of marketing, brand management, and moving products. “[Armand Hammer] opened the door for me, introduced me to some oil company CEO’s. That was a big influence in the next twelve years of my life as I worked for ARCO marketing and selling gasoline on the retail side in California. But I wasn’t happy with my career progression. I thought I had a lot more to offer than I was getting to disclose at ARCO.” This is the common factor that the majority of those I’ve had the pleasure of interviewing share. When a point in life becomes stagnant or unhappy then it is imperative to reconsider ones path at that time and determine whether happiness outweighs security. He was working 20 hour days at the time and made in his own words, a decent living, but he says that it was never his ambition to be middle management.
Leap of Faith
“I wanted to make my own destiny!” Najeeb exclaimed, but all the while realizing that he would have to give up his job security and take a leap of faith. Considering the crossroads at this point in his life, the timing could’ve have been better as the concept for a start-up IT business was presented to him. The offer sounded a bit untraditional for the pre tech-bubble era of 1997 as Najeeb was approached to take this concept public through an IPO…with no business. Najeeb was in high demand with his Pakistani background and knowledge of the business landscape there, as this was imperative to the success of this new enterprise. The goal was to use Pakistani IT professionals at a fraction of the cost to produce technology systems for businesses around the world. These were the beginning stages leading up to what we now know of as Netsol Technologies.
Najeeb knew this would be quite the undertaking but greeted the challenge knowing that he had the support of his wife and family and the drive to make this business a success.
The sincerity and admiration that Najeeb shows for his wife, and mentor, is moving. “Aiesha shaped my life,” he mentions while describing her supportiveness during these times of transition, “she really had influenced me in amazing ways…to take risks and do something different.” We all can recognize the importance of having those that love you support you in times of uncertainty and challenge and while Najeeb was making a jump into uncharted waters; his wife was there by his side. They both knew, however, that they were going to have to sacrifice the lifestyle they had grown accustomed to. Shortly after making the decision to spearhead this new operation, Najeeb and his family sold their home, a car and downsized to an apartment. It took two years to “put this thing together” and before he knew it, the company that he had helped build from the ground up had raised capital and was now in the position to do some acquisitions with his brothers company in Pakistan.
“It was great! We had money to build the software and find a niche.” They found a niche in financial software in the automotive industry and in the year 2000, with the stock price approaching $80 and a market cap close to one billion, things couldn’t have seemed better. Anyone who has paid attention to the capital markets in the last decade knows what happened next. “Some things you don’t learn in an MBA program,” Najeeb explains in parallel to the price of his stock crashing, “even companies like Microsoft couldn’t avoid it.” From 2000 to mid 2001, the price per share of Netsol Technologies had gone from $80 to $3 and certain investors started to question the validity and substance of the organization and its management.
On June 6, 2001, things radically shifted, the technology bubble had burst. The hedge fund that owned 12% of Netsol at the time thought that they could run the company better and they were willing to go to any length to prove it. At 7am, The Bluewater Hedge Fund broke into Netsol’s Calabasas office with a team of 18 lawyers, private security guards, and the money managers themselves. They somehow doctored up paperwork giving them the rights as CEO of the company and called all of the company’s banks in attempts to withdraw its assets. The stock was halved during this time period and prior to a court’s decision there was nothing Najeeb and the rest of his management team could do. At that moment it would have been easy for anyone to give up. “As long as the sky is not crashing, you can handle it.” The sky wasn’t crashing but the stock price was, and as Bluewater attempted to hold trading on the stock with the Nasdaq, Najeeb was notified and thankfully told not to worry. “For twenty days I was running the company from my house as they were in my office trying to find dirt.”Finally on June 26th , after Bluewater failed to abide by a judge issued restraining order, they were demanded to appear in court. Bluewater didn’t even show up because they knew that they had no case, “…they just sent their lawyers. Of course we showed up…this is our life.”
Bluewater’s legal team was thrown out and disbarred and Najeeb was now set to move back in and continue building the company that, because of this incident, had now taken giant leaps back in its progression and investor sentiment.
Netsol and Nasdaq
In the same year, this adorned Pakistani-American reached a cultural first by taking Netsol to the Nasdaq Exchange. That boost in morale was quickly destroyed by the attempted Bluewater take over. “It gives a whole new meaning to hostile takeover. They didn’t find any foul play and it’s taken us three years to recover.” Currently Netsol has 1000 employees worldwide with over 300 customers and started posting profits in the third quarter of last year. Now the company is on a very “positive track” as Najeeb and Netsol were honored by the Nasdaq, in September of last year, to ring the closing bell (pictured on previous page).
Last year things really spiced up as Najeeb and his family were host to the Simple Life girls, Paris Hilton and Nicole Richie. In the middle of running a company and worrying about making employees, customers, and shareholders happy, Najeeb and his wife enjoy MOZ Buddha Bar in Agoura and some of the sushi bars around town (see page 74). Although he doesn’t drink, Najeeb hosts numerous parties at his house with frequent celebrity and political figures in attendance. Najeeb is extremely active in a few non-profits and believes that “all of the evils of the world are because of lack of education.” He therefore focuses a lot of time with the Pakistani Urban Development Foundation helping to raise money for education and development in his home country of Pakistan. He has been instrumental in raising millions
for the cause.
Keys to Success
“Working for someone else, how far could I go?” In his own words, it was Najeebs passion, belief in himself and his experiences that have made him a better businessman and a better person. It was his passion for his creation of Netsol that dissuaded him from ever selling shares and to continue accumulating to what he now says is close to 22% of the company. In fact, when his company reached the height of one billion dollars in market capitalization he wasn’t interested in selling out. This business is his baby and it has been evident throughout his tenure that no matter what, he is not letting go.
Some of the lessons learned are imbedded but those that can be conveyed with words, Najeeb does an unbelievable job in articulating them;
Believe in yourself and what you do, if you don’t who will (other than your mother maybe)
There is no substitute for hard work
Be flexible and patient
There are no such things as shortcuts
Where you can in life, if success and self fulfillment are important, you must take risks.
Just remember that life is a learning experience and it is difficult to inherently comprehend the true value of life’s successes until you’ve experienced the perils that it can bring. In the words that so appropriately describe the path of Najeeb Ghauri,
“You must see the darkside before you can see the day.”
Since its inception in 1995 NetSol has evolved as a leading global IT solutions and services provider catering to clients all over the world. As the demand forever arises for efficient yet cost effective solutions NetSol has regimented itself to one guiding principle of "turning vision into reality", which drives their commitment to deliver the best of software solutions.
The Company developed LeaseSoft, its flagship product, which is designed to track finance and leasing information and handles the multi-billion dollar portfolios for heavy-hitters such as Toyota, Yamaha and CitiBank. This software is deployed worldwide, and targeted to a specific market need.