IN THE SPOTLIGHT -- Part 1 of a 3-part series: Chirinjeev Kathuria, M.D.

Tuesday, September 30, 2003

By Fran Eaton

GOP U.S. Senate candidate Chirinjeev Kathuria, M.D. is the first Sikh to seek statewide public office in Illinois.
Kathuria's company, Vimani, Inc., is located within this building located near the Chicago Board of Trade.
IN THE SPOTLIGHT -- He?s been featured in The Economist magazine, on CNN News, on the Britain?s BBC, in the Times of India and last week, in Newsweek, a former Brown University classmate wrote about him.

Dr. Chirinjeev Kathuria is a 38 year old physician who was born in India and grew up in the Chicago area. After graduating from business school, Kathuria developed several companies as a young entrepeneur, mostly in the field of telecommunications and Internet technology.

He has learned to compete in financial fields, in building corporations, in discovering new technology and now he is turning his competitive spirit towards a statewide political race. He wants to be the next Republican U. S. Senator from Illinois.

Dr. Kathuria is a practicing Sikh, wearing a full beard and turban in public at all times. He acknowledges to crowds that he does look different, but urges the audience members to ?not let the beard and turban fool them,? saying that he is an American.

On the day of our interview, Kathuria invited me to his Vimani Wireless, Inc. office just a half block from the Chicago Board of Trade in downtown Chicago. A beautiful, ornate building housed his eighth floor office, and the receptionist escorted me immediately into a conference room sparsely furnished and simply decorated.

?He?s ready for you,? she said, and left me alone at the conference table.

My interviewee arrived promptly, and after the offer of a cup of coffee and a few polite words, we began the interview. . .one-on-one.


IL: Dr. Kathuria, please tell our readers about your background.

Kathuria: My parents brought me here when I was eight months old. They came as most immigrant families. My father was an engineer and my mom had trained as a doctor, so they came in search of this American dream and ended up in Chicago and didn?t know what to do.

They thought this is going to be great, we are all going to go out and get jobs the next day, but this was about the time that the Civil Rights Act passed and wasn?t fully activated. So, my father had a very hard time getting a job because he wore a turban and they wouldn?t accept the training from India back then for my mother.

My mom wanted to be a surgeon but the only residency she could get was as a pathologist, so she did that. My father worked for a while doing various things and then someone from New York Life Insurance asked my dad if he would like to sell insurance.

The guy said if we give you some money you won?t have to work late at night and you can spend more time with your kids. My dad said it sounded good. But you have to remember that someone with a beard and turban trying to sell insurance to people, it just wasn?t happening.

IL: Did you know other families in the area who were also from India?

KATHURIA: It is amazing today that there are 200,000 Indians and South Asians that control 300 billion dollars worth of wealth in America. It is amazing to see an ethnic community grow like that.

In my story, we grew up in Chicago, moved to Forest Park and after that we moved out to Dupage County and we grew up there. We came to Oak Brook and then a whole wave of Indian immigrants came and it was easier for my dad to sell life insurance.

My dad said, ?If you want to do well in this country, if you are equal to someone else than you have to be better because you look a little bit different. Something that no one can take away from you is your education and your pride.?

In high school, everyone is interested only in football and basketball, so I was a typical geek. It?s going to be my twenty year high school reunion at Downers Grove soon, so I am looking forward to it.

I used to sit at the table with three kids, one used to wear his glasses on his nose and another Asian girl.

The kids used to joke around saying that our table had the highest average GPA. No one would talk to us. We really didn?t know how to dress. My parents would give us clip on ties and then we would have these nylon slacks that had stripes because that?s the way people dressed in India. We really didn?t know any better

IL: Do your former classmates know how financially successful you?ve been?

KATHURIA: I don?t know, probably not.

IL: Well, your businesses are not necessarily the type of businesses people would be familiar with. What do you think their reaction will be when they learn how successful you are?

KATHURIA: I?m excited about going back because it?s the classical story of the ?Revenge of the Nerds.?

Downers Grove was a great high school. I graduated valedictorian and everyone was shocked because I was kind of shy and didn?t talk to that many people. Everyone else -- like the student government president -- always advertise that they are doing very well, but I kept really quiet.

I remember that I was writing my speech and we were supposed to go and practice with the microphone, but I was maybe too nervous to go. So when I went to give my speech, there must have been 2000 or 3000 people in the audience, so I assumed that I had to yell really loud. I got up to the microphone and I started off my speech with ?Today. . .? So I yelled, ?Today? and all of a sudden you could hear was all these babies crying and everyone woke up all of a sudden and all these people just looked at me.

Back then I told them that we have truly entered the century of the educated person. John F. Kennedy said that education is no longer a luxury, it?s a necessity and a goal. We must prepare ourselves because we understand what happened to the coal workers in Pennsylvania. I told them of Future Shock, when too much change happens in too short a time. Our class is going to have the luxury of preparing for the future in education and technology. The service industry was going to be important. That was twenty years ago.

At that same time, I did some research in cancer and wrote a paper after I read a book saying that when people had cancer in the 1700?s, sometime during the plague, their tumor would disappear and I thought that maybe being in the 1500 - 1600, it could be the heat that corrected the problem.

So, my mom let me do some experiments in her lab and I wrote a paper called ?Selective Heat Sensitivity of Cancer Cells,? where we found that at a certain degree you can kill almost 70 or 80 percent of certain kinds of cancer cells without many side effects.

IL: Interesting. . .

KATHURIA: So, I wrote a little paper and applied to all the schools and Brown University. Every year around 4000 people apply for 30 spots where you get directly admitted to Medical School after High School. So, I was chosen to be one who got accepted to Medical School right after High School. You still have to go to College but you go to College for a shorter amount of time but you get your acceptance into Medical School because they still want you to have a rounded education, so instead of doing it in eight years you do it in two years.

NOTE: At this point, we were interrupted by a phone call from a person with whom Kathuria was negotiating a business deal. The board of directors of a pay phone company had just decided unanimously to accept Vimani?s offer to buy their company and use the pay phone locations for the Wi-Fi technology to use the wireless Internet within a specific radius of the pay phone. Kathuria said he had just spent $100 million.

KATHURIA: Three years ago, we started working and building some of the WiFi technology. The WiFi is a step up from the T1, but it allows you to take the bandwidth and distribute it nationwide. You can be pretty far away from the source, like a pay phone in the corner, you can be two or three hundreds meters away. You can sit in your office and have access to the internet. We are going to sell it like DSL provider. We will make our money as a provider, asking our customers to pay $50 a month for DSL. We would become a broadband provider like Comcast or any other provider, without the cost.

IL: Let?s continue with your background if you don?t mind. . . you were accepted into medical school at age sixteen, went to what college?

Kathuria: I graduated and went to college at Brown University. It was very different because it was an Ivy League school, and they had a lot of families from very rich prominent backgrounds. Just during my four years, John-John Kennedy was there, Giovanni Agnelli, heir to the Italian Fiat automobile empire was there, the King of Jordan?s son, and Amy Carter was also there when I was in medical school.

It was tragic that John-John died, and then Giovanni, because I knew them. I went to that school and was overwhelmed.

IL: Is college where you became interested in politics?

KATHURIA: This person came to me in my freshman year and his name was Romeo and he says there?s a spot open on the Student Government Executive Board and that I should run. I told him I had no interest in politics because I am going to medical school and I am way too shy.

He goes, ?No, we really need you and you will win.? I said, ?How am I going to win? There?s only juniors and seniors running and everyone wants to be on the executive board.? He said, ?Look at the statistics, at Brown 80% of the freshman vote and by the time you are a junior or senior, you think that student government?s a joke anyway and mostly juniors run.?

He said, ?And the fact is, you?re not doing it to put it on your resume because you are going to medical school, everyone else is running because they want to get into a better business school or law school.?

And he said, ?Those are Freshmen running and all the majority students are going to vote for you probably for a block. The other votes are going to get split and you have nothing to worry about because you are already in Medical School.?

Everyone completely wrote me off and said there is no way this is ever going to happen. The two juniors thought they would be in a runoff so they gone to watch a football game. Just as he said, they split the vote, the freshmen came and voted mostly with me, the minority students all voted for me because this is the first time it ever happened, and I ended up winning by 2 or 3%.

I think it shocked the board of trustees, also, to see a person with a beard and turban. I figured it wouldn?t happen again. I got really involved and we made a lot of changes. I was on the board of the Advisory Committee on Corporate Responsibility & Investments at Brown.

At that time, some of the issues that we worked on were needs-based admissions. If someone comes to school it shouldn?t affect their chance of getting to Brown if they could or could not pay. We were saying that Brown should stop investing in South Africa because of apartheid. So, we told them that they should pull out and eventually we were involved in student protest and all that.

The Ivy League started to pull out like Pepsi and Coke Cola. That was the beginning of ending the apartheid movement.

IL: When did all this happen?

KATHURIA: In 1983-87, I went there. Then all of a sudden I became very popular, it was unlike high school. I remember when I use to go to Brown, the first couple of weeks I would either go to the cafeteria very early because very few people were there and it wouldn?t look bad if you were sitting by yourself or toward the end I wouldn?t go with everybody because I didn?t have very many friends.

Then when I knew everyone I still would do it because you didn?t know who to sit with you didn?t otherwise want to offend anyone when you?re in politics.

I learned that when I went down to medical school and after medical school I spent sometime in Sweden. I went to an Institute and developed a independent concentration at Brown called U.S. Healthcare Policy and Administration and I earned a Bachelor of Science.

So, I studied healthcare policy and I spent some time in Sweden studying comparative healthcare systems and then working with Professor Allen at Stanford who was writing a lot on healthcare policy. I really got interested in that.

Then, after finishing medical school, I went out to Stanford to do my MBA and basically to write and study healthcare policy and then come back into a surgical residency.

IL: How did you end up back in India?

KATHURIA: After business school, I went back to India and at that time India was almost at the verge of bankruptcy. They had less than ten million dollars in capital reserves and at that time (1992-93) there was no foreign investment banks in the country.

So, Morgan Stanley contacted me and said ?Listen, we want someone to help set up our bank there?.

IL: How would Morgan Stanley get your name?

KATHURIA: It was through a head hunter in Asia and they had heard about us through some articles written about us. No one wanted to come to India because everyone wanted to go stay in New York, or go to the big European markets. Doing that was not a good career move.

So, they said ?Why don?t you help set up Morgan Stanley?s banking offices??

We were still working on getting the company licenses, so I spent some time in Hong Kong and would commute back and forth. So, I helped set up Morgan Stanley offices in India.

The experience was very valuable because the Morgan Stanley fund helped bring India their first capital inflow. Now you fast forward, India is one of the fastest growing economies and has close to $80 billion in foreign reserves. Every foreign company is there.

Then I spent sometime in Europe and at that time there was a big Internet technology boom. We came up with an idea to start free internet access because TV is free, paid for by advertising but in Europe you pay per minute for a local telephone company.

So a group of us got together and started a small company called X-Stream Networks. X-Stream put a little website up saying, ?All the best things in life are free -- even X-Stream."

We didn?t think much of it, but it grew really fast. We were able to close a $40 million dollar financing deal with Lucent to build it out. To make a long story short, it became the third largest provider in the UK. The company was merged and sold to Liberty Surf and we had a small stake in the company and the company went public for $2.9 billion. So we did alright.

Then after that I got involved in helping build another company, MirCorp, because I always wanted to be an astronaut. MirCorp started the first privately funded manned space program in 2004 and help send millionaire Dennis Tito into space.

After that we closed $100 billion financing deal to help us roll out a chain of MRITC scanners. Then we talked about getting into the Wi-Fi business.

So, you know, it?s been a very interesting and exciting time, but all this gave me a lot of experiences. As we talk about from the importance of trading jobs with small businesses to understanding how important space and satellite are going to be to the war on terror to when we studied healthcare policy and understanding the healthcare legislation, and then with the foreign policy on how to open markets to farmers in Illinois with Morgan Stanley.

That was a kind of the overall experience of my background.

IL: You?re not married. Tell us a little about your family. What influence did your family have on your success?

KATHURIA: That?s one thing when we talk about, education and I think Asian families if you look at - my brother is a doctor with an MBA, my sister is a doctor, my mom?s a doctor. I think Asian families and parents, the amount of emphases that they place on education, you have to remember it is a different thing.

For us, it was a question to whether or not we were going to eat or not eat if we didn?t have an education. That?s the way it is in developing countries. Here the mindset is different because in the olden days, the economy was growing very well.

You would have an apartment, a car, a TV, but where my parents grew up, the chances of getting into medical school were slim and they would have 10,000 people fighting to get one or two spots to get into medical school. The poverty in these countries is so great and education is really your only way out.

So, I think when the wave of immigrants came here, parents and education was such an important fundamental thing of the philosophy. The question wasn?t the question of whether or not you were going to grad school but which medical school you were you going to go to. Most Indian kids are doctors because the wave of immigrants that were allowed to come because of the policies of being doctors and engineers.

And I think there?s also a very strong work ethic. You don?t see that many South Asians on the entitlement program. Their work ethic is extremely strong and I think that everyone came or they left there in search of a better life, so they wanted to work to get a better life.

Whether you are Irish American, Italian American or Chinese American, it?s the same story if you look at everyone who came. You might be third or fourth generation, but if you trace it back, that?s how you got here. That?s what?s interesting about America.

What makes it strong is the extraordinary mix of people and their different viewpoints that allows it to be so successful. Still 200 years ago or even now, if people talk about coming to a better life, yet anywhere in the world people ask you where do you want to go, people say I want to come to America. That?s fascinating.

Which other country will you see people say they want to come to America.

IL: What happened in India to change the nation?

KATHURIA: India has changed. If you look, it?s one of the oldest civilizations. In twenty years, it has gone to be one of the strongest economies. People like us went back to help India grow and prosper.

So, I spent five years of my life in India helping that country grow. People are now realizing there is an opportunity, but in the olden days it was if you were born poor it was very hard to become rich. Now you see why India is doing so well.

When I graduated from business school, ten years ago, the question was are you going to get a job, which industry do you want to get a job in and you probably had three or four offers and what part of America do you want to live? One of my goals when I run for US Senate is to bring America back to that same kind of time when someone graduates from college. Here the kids can?t even get jobs, Lucent laid off 45,000 people. America?s got to go back to building a strong fundamental economy.

If India can do it, America as the basic building block for the past 200 years, it?s just how to make sure the economy keeps on growing.

IL: What went haywire in recent years from your perspective?

KATHURIA: The economy, if you study it, is stagnant. I think what happened was there are times you?ve seen it, when India went through strong growth and back up, you remember the Asian economy, everyone wanted to invest in the emerging market, the emerging markets collapsed. Russia collapsed. Russia had one of the best performing stock markets but I think what the US needs to do is focus on a study on where to grow.

I think what happened is a couple of things. The capital market is the one that helps create wealth and regulate the economy. People lost faith in the capital market.

I think one of the issues that we need to focus on is (I?ll go thru them all later on) with corporate governance, you got to have directors, CFOs, CEOs, accountable because you hear about scandals like Worldcom.

The list just goes on, and it?s not just in Telecom, it?s from every major industry. Investors and small people lose confidence in the stock market. Then, I think, the technology movement boom was over-inflated. It was a crazy time.

I can tell you from my own companies, we were able to close huge amounts of financing, take companies public, not always with solid fundamental track records. You can always go back to the basics. I think there was such a big boom and what happened is the reason most of these companies did because there was too much easy access to capital.

If you look at most of these companies, even the company that we have, they took huge amount of debt to keep on growing. Then all of a sudden when the economy is slow, you can?t repay your debt. So, I think what should have happened is there should have been more focus on equity and one of the reasons was a problem with the capital gains and the way the tax cuts were is that if you took out debt, the debt you could deduct the interest income.

I think what President Bush did with the capital gains caused the dividend cuts and is putting the economy on a strong fundamental road. Times have changed. The industries like the coal industries, and the railroad that were the dreams, changed.

You went to the Internet to manufacturing to the service industry, it?s just evolution. Things have to change. What America has to do is be on the forefront of that. What people need to realize is three-fourths of the world?s population lives outside the United States.

The India cell phone industry or China, you've got to take American goods and allow them to be exported with fair trades to these countries because that?s going to create more jobs. You?ve got to export these new technologies, your service industries overseas.

You got to be at the forefront. I think the tax cuts are good, they stimulate the economy. What people don?t realize is that small businesses account for the majority of job creation. You got to help small businesses.

It is so hard for them to get incorporated, health insurance premiums are too high. If you work part-time you can?t get help, so you got to really encourage small businesses. Then you have to re-engineer these companies and re-train people. You can?t be stagnant, you?ve got to keep growing.


On Wednesday, Part 2 of the 3 part series will include a discussion of Kathuria's position on key issues.

Fran has worked on the staff of the Illinois Leader since its inception in June of 2002.

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