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Lokvani Talks To Dr. Ranganath Nayak

Ranjani Saigal
11/03/2004

(This article is sponsored by Attorney Trupti Patel)


 I love the atmosphere of a well-run startup,” says Dr. Ranganath Nayak, CEO of Cytel Software, a company that provides statistical software and services for optimized clinical trials. Prior to Cytel, Nayak served as CEO of Auripay Inc., a company providing software for secure on-line purchasing with credit cards. Previously, he was a senior executive with The Boston Consulting Group and Arthur D. Little, Inc..  He has significant experience building businesses and setting strategy in technology-intensive companies.
 
He is a charter member of The Indus Entrepreneurs (TIE), and has worked with the Massachusetts Institute of Technology's Venture Mentoring Service (MITVMS). A man with several philanthropic interests, he has been actively involved with The Graustein Memorial Fund, which focuses on improving education for young, disadvantaged kids in Connecticut and in Cultural Survival, an NGO that helps indigenous peoples fight for their rights and for the survival of their cultures.

He is married to Sandy Tompkins Nayak, and has three children, Lakshmi, who is a school teacher in the Lowell Public Schools, Anand, who is a professional musician focusing on folk music and Maya, who is a senior at Brown majoring in African studies. 

What motivated you to take up the position of CEO of Cytel software at a time in your life when arguably you could enjoy the peace of quiet of retirement?

The company was founded by Dr. Cyrus Mehta and Dr. Nitin Patel. They were instrumental in the development of statistical algorithms, which do exact analysis of data without making assumptions about probability distributions, and of fast and accurate computer algorithms to implement computationally intensive statistical methods. StatXact, East, and other statistical software tools that are part of the Cytel suite of offerings were created to convert the groundbreaking work of the founders into usable software.

In the drug discovery process, Phase III randomized clinical trials are an expensive and time-consuming undertaking. The ability to stop such trials early either for benefit, equivalence or futility, has enormous value.  The software provided by Cytel can help accomplish exactly that. During the past few years there has been a growing demand for these products all over the world in the area of clinical trials in the drug discovery process. Thus Cytel is experiencing tremendous growth.

As Cytel transitions to a becoming a larger company, there is need for a management team that can make that transition happen smoothly. Dr. Nitin Patel, who is a family friend, asked me to help with this process. The offer was exciting for me because building businesses and helping them grow is something I really enjoy.  So I accepted and I must say I am having a lot of fun.

The high prices of drugs seem to stir a lot of passion among consumers and drug companies often attribute the high price to the discovery process.  Do you see any change occurring?

There are a lot of changes happening in the drug industry. Companies are working hard to cut costs. This attempt is opening the way for a lot of innovation.  Companies like Pfizer are leading the way and are bringing a lot of innovation to the discovery process. I am positive that this will help cut the cost of drugs.

I think in the  drug industry is where the US automotive industry was 25 years ago. Until Toyota entered the market, it would take car companies four billion dollars and six years for automotive companies to come up with a new product. Toyota came along and proved that it could be done for one-fourth of the cost in 20 months.  You can read the Toyota story in my book, Breakthroughs!  Since then the whole industry has changed.

You have worked a lot with TIE and the MIT venture forum. In today’s climate, do you still think it is worth doing a startup?

If there is a good idea that can form a good business opportunity it is certainly worth doing a startup. But if you need VC funding you need to demonstrate through whatever means that you are ready to complete a sale for your products.

You have said that you love the atmosphere of a well-run startup. Can you describe the features of a well-run startup?

In a well-run startup there should be a really good team in place for product development. You need a first class sales team. Many startups  ignore this. There should be some seasoned person in the group who can keep everyone focused. It is very easy for people, in their enthusiasm to show initiative, to run in different directions. A well-run startup should have decent financing – whether it is through sales, SBIR or venture capital.  And it should spend its money wisely—“as though it were your own”.

In a climate of tight VC funding, would the government funding through say SBIR be a better source?

There are SBIR programs that are part of DOT, DOE,  NIH, and other US Government agencies. They are great programs. But they have a long lead time. To get them you should be able to make a good impression on the community of people who are leading lights in the field.  If you would like to seek funding from these programs, you have to know the grants business or else you will be spinning your wheels.

Besides running a company, there are many activities that you have involved yourself in. Could you describe them?

One activity that Sandy and I are really proud of is of our involvement in host family programs. We have served for several years as host family to foreign students at MIT, Harvard, Brandeis, BU, Tufts, and other local universities. These students have become a part of our extended family. I have learned so much from each one of them. I must say that they have enriched our lives with their presence.  We have done this now for 27 years, and our “hostees”, as we call them, live all over the world.

I also help with the governance of The William Caspar Graustein Memorial Fund, which works collaboratively with leaders in fifty communities to improve education for Connecticut's children by supporting school change, informing the public debate on educational issues, and strengthening the involvement of parents and the community in education. The major problem in some of the lower income neighborhoods is that parents do not understand the process by which they can get things they need for their schools. They do not know how they can be involved. Without community involvemdo not get the attention and funding they need.

I am also Chairman of the Board  of a wonderful non-profit organization called Cultural Survival, the founders of which are David Maybury-Lewis, retired head of the Anthropology Department at Harvard, and his wife, Pia.  Look them up at www.cs.org.

Have you ever involved yourself in politics? Do you think it is important for Indian Americans to be involved?

The most active involvement I have had was when I tried to get Nixon out of office.  It was an interesting experience. When I talked to people, I realized how difficult it is for the American people to believe that their President was a liar.

I would urge everyone to be involved in politics. The involvement could vary from having debates on issues on the sidewalk, as it is common in India to do, to actually participating in campaigns. If there are issues that are important to you, you may want to lobby for what you believe.

As a very accomplished member of the Indian American, is there any advice that you have for others in the community?

I would advice everyone to travel. Often we get so caught up in our work that we do not take the time to lift our eyes and see the world. America is a beautiful country with a wide and varied culture. I would recommend that people take the time to see the country. We live in cities and only understand the urban culture. Last year, my wife and I  took a nine-week trip across this continent. We shunned the Interstates, traveling mainly on local roads to take in the local color. Seeing people in their habitats can change you perspective. For example in many rural communities hunting is an essential part of life and to them the concept of gun control makes no sense whatsoever.  The best part is, the country is awesomely beautiful, easy to travel in, and very friendly,

I would also urge people to take the time to travel in India. Often, our time in India is restricted to family visits. I think traveling through India is also a mind-opening experience.  Away from the cities, the country is incredibly beautiful.  Traveling has become much easier, and the food everywhere is great.  And there aren’t friendlier people anywhere else on the face of this earth.
 


 



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