What Mu Sigma's founder-CEO split says about marriage and business

Dhiraj Rajaram, founder-chairman of Mu Sigma, and his wife Ambiga, who is the company's CEO, have divorced, raising questions about the future of the Bangalore-based data analytics company, one of the few Indian "unicorns" (private companies with a valuation upwards of $1 billion).

The first stirrings of trouble became public in February this year when Ambiga was made the company's CEO, prompting Rajaram to shift to the US. An Economic Times report said investors had been told about problems between the couple six months ago and employees have known about it for close to three months.

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This is perhaps the first high profile case of an entrepreneur couple parting ways in India, calling into question the future of a company that was founded barely a decade ago but which has quickly become one of the most exciting spaces in the fast-growing analytics space. Mu Sigma is an entirely home-grown start-up and counts among its investors marquee names like Sequoia Capital, General Atlantic Partners, MasterCard and Fidelity.

The divorce brings into focus the difficulties of running a marriage when the business is what ties a couple together. There are cases galore of marriages breaking under the pressure of making a business succeed. In 2013, Google co-founder Sergey Brin separated from his wife, Anne Wojcicki, the co-founder of DNA-testing company 23andMe. Elon Musk, founder of Tesla Motors and SpaceX, has been divorced twice since 2010.

Running any business can be stressful - from missed payments to personnel issues, and entrepreneurs who decide to start out on their own often find the thrill of following their passion dissipate in the face of stringent challenges. In such cases, the home is supposed to be an oasis of comfort. When your spouse is part of the business set-up, that space is gone.

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What becomes especially distressing with rising businesses like Mu Sigma is the constant need for financial backing. Most first-generation entrepreneurs like Rajaram set out on their own after working traditional jobs. A graduate of Chicago Booth, he worked at PwC in the US and Booz Allen Hamilton in India before launching Mu Sigma.

In such cases, bootstrapping - or dipping into one's own finances for funding - is the preferred option among entrepreneurs in the initial stages. This becomes a trying time since most entrepreneurs take these risks during a phase when they also have family responsibilities to look after.

To be sure, Rajaram and his wife had gone beyond that phase. Mu Sigma is cash-rich today, thanks to its successful business model and the faith shown in the company by investors. That said, not all companies with great ideas are able to raise money, leading to all-round losses. Even when funds are available, they may be highly cyclical, as Flipkart and Snapdeal have recently discovered.

A start-up may play havoc with a marriage also because it requires all the passion and concentration of a relationship. For first-generation entrepreneurs, the company is like a baby, and making it work is tied up with self-image. That the founder gives up a secure job to start out on his own increases the pressure to succeed. With the focus singularly on the company, the emotional space needed to make a marriage work may simply not be there.

While Rajaram and his wife are putting up a brave front, there is much cause for anxiety going forward. As chairman and CEO, respectively, of the company, they need to work closely, a scenario that is unlikely to continue after a divorce. While it is all very well to hark to professionalism, running a business requires tremendous emotional connect and rapport.

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If they decide to continue to work together, great, but if not, the company will suffer greatly. Since both have been with the company from the beginning, it is natural to assume that both feel a natural ownership of it. Hence, if any one of them decides to leave, not only will he or she have to be suitably compensated but that person will also suffer from the trauma of being cut off from something that has been an intrinsic part of their identity.

Sharing the spoils will be another messy affair. Since spouses' finances are not clearly separated in most marriages, breaking down the investments into neat brackets can prove mind-numbing. In such cases, a mediator's services are employed to resolve issues.

Investors, saviours during crunch time, can be surprisingly cold in these situations. For a company as big as Mu Sigma, their primary concern is to secure their financial interests. Discussions about the future can be bereft of any concern for the status of the personal relationship, as long as questions on the company are satisfactorily answered.

As they face a debilitating time, here's hoping and Dhiraj and Ambiga can come out of this stronger, financially secure and happier.