Narayana Murthy Story: How a Failed First Company and Rs 10,000 Built Infosys (5 Founder Lessons)

Admin October 09, 2026

Narayana Murthy: from Rs 10,000 to Infosys

His first company failed. He borrowed ₹10,000 from his wife to start the next one. Today that company, Infosys, reports about US$20 billion in yearly revenue and more than 328,000 employees. This is the story of N. R. Narayana Murthy, and five lessons you can use.

Early life and a first failure

Narayana Murthy was born on 20 August 1946 in Sidlaghatta, Karnataka. He studied electrical engineering at the National Institute of Engineering, Mysuru, and then did his master's at IIT Kanpur. He worked at IIM Ahmedabad as chief systems programmer, where he worked on India's first time-sharing computer system.

He then started his own company, Softronics. It failed after about a year and a half. He went back to a job, joining Patni Computer Systems in Pune. He has also said that being arrested and expelled in 1974 in a border town near the Yugoslav-Bulgarian border, for no good reason, changed his view from "confused leftist" to "compassionate capitalist".

1981: Seven engineers and Rs 10,000

In January 1981, Murthy and six software engineers talked about building a software company. Infosys was registered on 2 July 1981 in Pune as Infosys Consultants Private Limited. Infosys's own history says the initial capital was US$250. Its annual report says the paid-in capital was Rs 10,000, reportedly borrowed by Murthy from his wife.

Sudha Murty has said she gave him Rs 10,000 from her savings, and called it a risk, since they both had well-paying jobs. The company signed its first client, Data Basics Corporation in New York, in its first year.

The ground rules they set on day one

Infosys's annual report lists the principles the founders set at the start: the company would earn a profit from year one, every project would be delivered at a reasonable profit, the balance sheet would stay liquid, and borrowing would be only to buy assets.

How it grew

  • 1983: moved to Bangalore.
  • 1987: opened its first overseas office, in Boston.
  • 1993: went public in India and started an employee stock options programme.
  • 1999: crossed US$100 million in revenue and listed on NASDAQ, the first Indian IT company to do so.

Murthy was CEO from 1981 to 2002 and chairman until 2011. He returned as executive chairman in 2013 and stepped down in 2014. He received the Padma Shri in 2000 and the Padma Vibhushan in 2008.

5 founder lessons

  1. A failed first company is tuition, not the end. Softronics shut down. Infosys came after it.
  2. Start with what you can afford to lose. The first capital was Rs 10,000. You do not need a big round to begin.
  3. Write your rules before you write your first invoice. Profit from year one and a liquid balance sheet shaped how Infosys ran for decades.
  4. Share the upside. Infosys started an employee stock options programme in 1993, so staff could own part of what they built.
  5. Think global from the first client. Infosys's first client was in New York, and its first overseas office opened six years in.

Takeaway

Infosys did not start with a big idea or a big cheque. It started with seven engineers, a small amount of money, a spouse who took a risk and a few strict rules. For a first-time founder, that is the point.

Sources are listed below. Figures come from Infosys's own pages and public reporting. Details of 1981 capital are described by Infosys as "reportedly borrowed".

Sources

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