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Oodles of confidence

Birth of an idea: When the first Yo! China restaurant opened in May 2003, it was sometimesshut for a few hours during the day. The reason? The restaurant would run out of food. "The

response was phenomenal. We were stumped," says Ashish Kapur, managing director of MoodsHospitality which started the Chinese fast food chain.

Kapur was working with GE in the US as part of their global leadership programme when in2002 the idea of starting his own enterprise struck him. "I really wanted to give entrepreneurshipa try. Since I was young and well qualified, even if my venture failed, I could go back to a job.So I took the risk," he says. The instant success of his first restaurant was the result of a lot ofplanning and hard work.

First, of course, was being sure that being an entrepreneur was not a passing fancy. Then he hadto zero in on the business he wanted to create. The Indian economy was booming and after

exploring business opportunities in India (he even considered a low-fare airline), Kapur decidedon a fast-food chain.

The organised retail sector was about to take offand food seemed to be a sound choice. No oneelse, apart from McDonald's and KFC, were evenattempting it in India. The best part, says Kapur, isthat he is a foodie: "I love food and was bound tolove doing business in food."

Working on the idea: The choice of Chinesecuisine was based on facts and gut instinct. Kapurrattles off statistics. Chinese is the second most-ordered cuisine by families across various types ofrestaurants. Among youth, it is the top choice foreating out.

"Between street hawkers and fine-diningrestaurants, there was nothing that offeredwholesome Chinese food at reasonable prices.That was my market," he says. Quality food atbudget prices, quick service, trendy ambience-that's the combination that distinguishes Yo!

China restaurants from the competition.

After eight to nine months of working on the ideaalongside his job, Kapur finally quit GE Capital in2003. No one in his family had ever ventured intobusiness. "They were appalled by my decision,"recalls Kapur. Worse, in a few months Kapur was

getting married. Thankfully, his fiancee was working so running the household wasn't a major

Ashish Kapur, 31

Education: BE, McGill University,Quebec, Canada

Last job: GE Capital, US

Last salary: $35,000 a year

Time spent as employee: 4 years

Age at starting business: 26 years

No. of years as entrepreneur: 5 years

Initial investment: Rs 70 lakh

Sources of fund: Angel investors

Company: Moods Hospitality

Turnover: Rs 50 crore (estimated for2007-8)

No of employees: 600

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issue. Moreover, she supported his idea.

Out of job, Kapur continued to study the profitability of food chains, the business models of thesuccessful ones and how they functioned. He worked in the kitchen of a restaurant to get a feel ofthe food business. Alongside, he prepared a business plan. Then began the round of visiting

investors.

"My first plan was unceremoniously dumped. In fact, in the course of meeting with investors, theplan was revised many times," he says. Kapur's business required so much money that financingit personally was out of question. In the US itself he had met a number of investors for financinghis idea. Though he did not succeed, their inputs helped him fine-tune his plan.

Setting up: He struck gold in 2003. Three angel investors decided to pool in about Rs 70 lakhfor the first restaurant and scale up as the chain grew. He also offered a stake in his company to a

hospitality sector ace and a marketing professional from an airline company so that they couldbring in their experience to his start-up.

From the beginning, Kapur bet heavily on getting the right people in his team. On a visit to atrendy Delhi pub, he was impressed by the way it was run and hired the manager-in-charge.Professionals were hired to design the decor, display kitchens, name of the chain and its tagline.

All through, the vision of a food chain was kept in mind-the design had to be simple, yetsophisticated, for it to be replicated across outlets and have an international feel. "We were awarethat customers would be drawn not only to the food but also the ambience," says Kapur.

Finding the right chef turned out to be extremely difficult. Kapur sat through numerous kitchentests till he found the one of his choice. About 40 people were hired for the first restaurant. Thecost of equipment- sourced locally-was about Rs 10 lakh.

Dream start: The first Yo! China opened in Gurgaon in May 2003. Any memory of an earlycrisis? Kapur recalls: "We had invited 200 people for the trial run. About 600 turned up. EvenKapil Dev had to queue up for food."

To the promoters' delight, the situation repeated itself many times after they launched. Yo!China's first restaurant broke even in its first month. The second opened in December 2003. Butnot all restaurants were immediately successful. "In the beginning we would open an outlet innew malls. But that didn't necessarily result in footfalls. Now, we are more circumspect," saysKapur.

He and his partners study in detail the demographics of a neighbourhood before choosing alocation. "The thinking behind such rigorous research is to be close to a catchment area. Wedon't want our regulars to drive for hours to find a Yo! China outlet. Instead we should be closerto them," he says.

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With 20 restaurants (of which 11 are franchisees) in 12 cities, Kapur is still fine-tuning hisstrategy for expansion. "The requirements for scaling up are so different from starting a newrestaurant. I've become an entrepreneur all over again," he says. He knows that retainingcustomer loyalty is difficult. But he hopes that a combination of good food and good experiencewill keep Yo! China a step ahead of the competition.