Startup India, Standup India: The Missing Link

Euphoria is in the air. Startups – the poster boys of these times – have got another fan-base, i.e., the Government of India, cheering for them. Startup India, Standup India Action Plan announced on January 16th by Prime Minister Narendra Modi has created another level of excitement among all stakeholders – be it venture funds, angel investors, incubators or startups.

It is not the first time in the history of India, that the Govt has announced some major policy decision, but probably it is the first time that the Govt has gone ahead and engaged with a section of society, which was not represented by any powerful industry lobby-groups, business-families, lobbyists or PR firms. If India has changed in last 18 months, then it was very much visible in Vigyan Bhavan on January 16, 2016, as more than 90% of the audience must have visited those august corridors for the first time in their lives.

And the level of engagement was unprecedented; however, the real game-changer was not the flawless execution of the event or the line of speakers gracing the occasion, but the intent of Govt, which was to become an “enabler” from the position of being a “provider”. The statement, “Eventual freedom from State will be a true evolution for startup”, was not made by some anti-govt activist in a dingy hut in some forest, it was made at Vigyan Bhavan by none other than Mr. Arun Jaitely, the Finance Minister of India. The statement, later endorsed by Prime Minister Modi, is a major paradigm shift in the thinking of Govt, and hence, a watershed moment in the history of India.

However, as it happens with any organization, there is always a huge gap between the vision of the CEO and execution being done at the ground level, and the Startup India / Standup India policy decisions were no exception to this. Hence, while PM Modi talked about how to remove Govt interference from day-to-day workings of the startups, the policies announced (barring one or two) just ended up achieving the exact opposite of the stated objective.

Startups as defined by an inter-ministerial group, approval from a Govt approved incubator, tax exemptions, State-sponsored Fund of funds – all these measures will not reduce but increase interaction and intervention by State multi-fold, and will create multiple layers of fault-lines and defeat the very purpose of startup policy as well as act against the vision of PM Modi.

While tax exemptions and sops are welcome, they will not help startups in short-term/long-term as startups/funds are looking for a stable legal environment, clarity in tax laws and minimal interaction with Govt in the initial formative years. Unfortunately, things are totally reverse at present moment and nothing has been done to address these issues.

Startups/investors are loaded with paperwork at every step and every paperwork results in extra costs as well as breeding of corruptions. One such example is “valuation certificate” which is required by the startup to establish the fair value of startups at the time of raising capital. After every transaction by an investor, valuation certificate from an accountant is needed and tax is levied on deemed income if there is a gap between accounting firm valuation and investors. This rule creates huge issues in creating ESOPs / investments / Call / put options, etc. Take Uber as an example. UBER is an Indian company, last year its investors would have been taxed $3 bn on the income of $10 bn as Bill Gurley (Uber Investors) valued Uber at  $16 bn while Damodaran – a worldwide expert on valuation – valued Uber at $6 bn. However, this year Damodaran is valuing Uber at $90 bn while investors valued it at $62 bn. So if an expert like Damodaran is wide off the mark on valuation then how one can trust the valuation certificate by some CA firm using vague methods to value a startup. This exercise is the first step in corruption as well as in vague paperwork.

In fact, every law/process has been designed to harass than to encourage compliance. The biggest proof of such an attitude can be seen in our tax laws, which seems to violate all the basic tenets proposed by Adam Smith. Adam Smith said:

1. Tax rates shall be reasonable (in India, due to multiple levels of taxes, sometimes taxes are as high as 30% or more of revenue even when the company is incurring heavy losses and has cash flow challenges.)

2. It shall be easy to pay taxes (In India, payment of tax is another challenge – try to fill a service tax return on your own.)

3. The penalty shall be severe in case of non-compliance (Penalty area is highly confusing and harassment-driven, where depending upon one’s position, the whole penalty system works.)

So overall, this environment creates a high level of uncertainty and confusion {what to pay (multiple rates), how to pay, and what if we can’t pay?} Needless to say that all these road-blocks create huge uncertainties amongst the moods of entrepreneurs/investors and kills the spirit.

The Ellsberg Paradox demonstrated that its the uncertainty not the risk which makes people activity-averse, and as a Venture Capitalist / Entrepreneur, we face this dilemma every day as we can provide for risk but can’t provide for uncertainty.  Unfortunately, Startup India Standup India policy didn’t do anything to address this issue of uncertainty in the proposed laws and instead created another layer of approval/process in its system.

The only way we can tackle this problem is by eliminating options and being an adult about it rather than being parental about it.  The aim of the policy related to Entrepreneurship/Innovation shall be to build an adult society rather than a parental society, which respects and encourages citizens to grow rather than nag/guide/force/bribe to grow. Hence, rather than various fund allocations/awards, the aim shall be to create the right environment and not an incentive structure. Hence, Govt needs to study the level of interaction a startup has with State and shall aim to eliminate/minimize those interactions for the enterprise of a certain size (say INR 3 Cr annual top-line, as, at this level, the company builds enough resources to deploy in compliances). Limit of INR 25 Cr in top-line is excessive and shall be dropped since a company with top-line of more than INR 3 Cr is no longer a startup and is already in advanced age.

Hence, it’s high time bureaucracy listens to the vision of PM Modi carefully and figures out a way to minimize interactions with startups rather than increasing them. Otherwise, instead of Standup India, this will become Sitdown India and we will miss the golden opportunity of becoming a leader in the era of Startups.

Jai Hind!

Age of Porn / Age of Kali

Traveller, foodie, and photographer!!! These powerful three words, or traits, probably capture the personality profile of 90% of millennials / “generation me” navigating the wild-wild-web on those social, or not-so-social, websites.

These foodie travelers armed with cameras are in the pursuit of creating mind-boggling images every second. Some 800 billion photos were created and shared on social networks in the year 2014, and these numbers are quadrupling every quarter, and the world seems to be shifting to images as demonstrated by the fact that Instagram users (Instagram is social network built for sharing of images) far exceed users of Twitter, which is more about sharing of thoughts/ideas/content along with images.

So clearly, ‘photo’ is in and ‘selfie’ is the official buzz-word of the year 2014, where each day overwhelms us with barrage of photographs shot at perfect times enhanced for that perfect look showcasing our latest travel adventure captured in that DSLR or on mobile with nth options, and reinforcing the photographer/traveler in us. Not to be left far behind, Masterchef TV show continues to attract a new crowd every year and roll out seasons after seasons in the wake of its ever-increasing reach and popularity across every race/culture!!! And thus comes our foodie, traveler and photographer!

So, the age of conspicuous consumption or age of porn!!!

Enhanced photos of self, surreal photos of travel, picture-perfect cooking shows in beautiful kitchens filled with shining crockery, and continued onslaught of beautiful, desirable and unreal photo-shopped images consumed by a generation lurching in their cubicle/pajamas, and as far away from the real thing as possible!!!

As we start to look around and see things closely, it suddenly dawns to us that we are staring at an age of simple and quick gratification where every story is cut/edited and photo-shopped in the most glamourized way with more connection to fantasy than to reality. This is being created for mass consumption, a pattern which one would associate with pornography rather than things like social networks. The onslaught of images, the media and the advent of smartphones are making things more like porn than anything else, and it looks like we are finally in the “Age of Porn” with all things porn.

There is FoodPorn, where a glamourized spectacular visual presentation of exotic food is voraciously consumed by masses of people who rarely enter the kitchen or indulge in any sort of cooking, but savor all cookery shows.

We have TEDPorn, where complex concepts are simplified by big font presentations. This overwhelms the users into a surreal world of make-believe where every big thought/idea can be explained in big font 18 slides. Umair Haque – in his thought-provoking blog post, “Let’s save great ideas from the ideas Industry,” published in Harvard Business Review – argues that TED thinking is an anti-thesis of big ideas where it cheats us by “putting climatic epiphany before experience, education and elevation”. This reduces our experience of a great idea to a porn-like experience where one is consumed by simplicity and glamour and is removed from reality. Thus, argues Haque, users are incapable of experiencing the big idea and enjoying its reality.

At one end, where the intellectual elite are consumed by TEDporn, dreamy-eyed among them are consumed by StartUpPorn at another spectrum. This is consuming hordes of youngsters/business executives, who are blinded by flashing headlines of billion-dollar valuations and are jumping in startup bandwagon without any suitable skills or resources, yet feeling like a rockstar. The fact of the matter is that every startup founder is indeed a rock star, but without corresponding stage-lights and roaring, swooning audience. He is a rockstar where lights are off, stands are empty, and the battle is a long lonely night with Rudyard Kipling whispering softly in the ear, “When there is nothing left except the will, which says ‘Hold on’.” Running a startup is a lonely battle and an everyday struggle with or without funding, and nothing like the glamourized world as painted by the media. However, the glamour of startups or StartUpPorn keeps on attracting all those converts / non-converts with just images of billion-dollar valuations dancing in mind.

However, to make matters worse and probably to make StartUpPorn more palatable, we are now getting ushered to FailurePorn, where failure is getting glamourized in a way to supplement the argument for consuming StartUpPorn. Glamourizing failure is leading many down a tricky path and embarking on a treacherous journey for which they are not ready mentally or financially. Geoff Lewis, a partner of FoundersFund, rightly cautions in his article published in Washington Post about celebrating failure too much. With almost negligible fear of failure, it is creating a myopic view and getting us to consume “failure” as fast-fashion peddled by highly successful people without any relation to reality.

However, all these – FoodPorn, TEDPorn, StartUpPorn, FailurePorn – pale when it comes to the biggest porn created by all of us in the form of those perfect moments of joy continuously fed on social sites – SocialPorn. These picture-perfect moments of others’ lives suddenly make our own life appear mediocre/duller/more boring than what it is, and hence, chips away some part of us every day!

As real porn destroys young minds and makes one incapable of having a real relationship with real people, this multi-faceted porn is destroying every part of life in a way one never imagined!! Probably ‘Age of Kali’, or kaliyug as Hindus believe, is finally here and is manifesting its presence by these daily destructions and consuming us.

It’s here, it’s here, it’s here! Images, images, and Aaahhhhh – more images!!

Drama @ Wagah Border

Nothing captures the essence of India like Wagah Border Post daily ceremony. The show, Chaos, Confusion, VIPs, VVIPs, honks, false rhetoric, and oh yes, the usual second-class Indian citizen, the native who runs from pillar to post to get passes and then some seat, and ends up being a native refugee with hardly any dignity.

Hence, the ceremony at Wagah Border is a Dance of Democracy! Or is it a Drama of Democracy… God knows!!!

Wish List for Budget: Unleash the Entrepreneurial Spirit

The maiden budget of Narendra Modi Govt. is about to be presented in coming days, and as usual, there is loud chatter and demand around raising tax limits, allowing greater tax exemptions, as well as various other tax sops demanded by industry bodies. It is not that these demands are made for the first time; but being Shri Modi’s first budget, the expectations are much higher than ever before. While the aim of a national budget is to present checks & balances of annual revenue along with expenditure and provide an overview of the overall economic health of the country, the annual budget for all practical purposes should go a little beyond that. Since it shapes up the long-term behavior of the public at large by way of taxation, policies, etc., solely focusing on increasing tax limits, etc., is akin to demand allocation of medical leave while what one needs is a lifestyle change to get on their feet!

Hence, rather than doing short-term adjustments related to taxation, etc., Modi govt has a great opportunity to use the budget for changing the fundamental way the Indian Inc. behaves and operates. Following are the fundamental changes needed to transform India from being an emerging market to a super economy on steroids. These key three basic ingredients are:

Focus on Building and Creating Trust

India is a trust deficit society where not a single paper can move without getting notarized by some nondescript shop in some corner of some court.

This basic approach of “trust no one” has resulted in a regime which has loads of laws designed to plug any hole and has ended up doing more harm than good. For example, the new Companies Law 2013 has just added to the woes where it has now become impossible to start a company without spending a fortune on accountants and company secretaries.

Somehow in India, the lawmakers and bureaucrats work with the fundamental belief that every private enterprise has been started with the core aim of committing fraud, launder capital, evade taxes, and commit financial crimes until and unless proven otherwise, and it may come as a great shock and surprise to our giant army of babus that private companies/business – big or small – do add to the wealth of the nation and contribute in their own way in building the nation. The aim and objective of any government are to keep its citizens happy and to help them achieve this goal rather than doubting every motive and treating every enterprise as a den of crime. Hence, the government needs to behave in a more mature way and adopt a more adult approach when it comes to the treatment of companies, instead of having a parental attitude towards everyone.

Foster Entrepreneurship / Encourage Failure

A society/nation is carried forward by the tribe of risk-takers and not by the army of clerks and babus. In not so distant a past, England, being a tiny island, ruled over the world on account of its tribe of risk-takers, and today, USA dominates the world on account of new companies/technologies.

Unfortunately, in India, we reward mediocrity and continuity, and punish risk-takers, as the cost of failure is very high. Try to close a company after a failed business!!! One will end up spending more money and time closing a company than in starting a company. Compliance and taxation liabilities further sink down a struggling company. Moreover, there is hardly any incentive for starting companies. The budget should reward entrepreneurship and allow failures to happen. Taxation rules for enterprises doing up to 5 Cr top-line should be simple, as they are not in a position to manage compliance cost, unlike bigger companies. Opening & Closing of companies should be simplified and made cost-effective. There shall be less tax-filing hassles for companies which have paid up capital of INR 5 Cr or less and are of less than 5 years of operational life.

Bring Accountability / Transparency

India is the land of regulators. For everything to work right, there is a regulator, and every year there is demand for more regulators, and just like it happens for every person in power, regulators’ demand for power just increases year after year, and Yes, all power without any accountability / answering to the public.

Hence, while increased regulation has increased the burden on companies/individuals multi-fold in terms of costs / increased paperwork, there is hardly any empirical evidence of regulators being effective or not being misused by vested interests, since there is zero accountability.

Its high time the new govt makes regulators accountable for actions taken and shall be responsible for all power being demanded by them, as lack of accountability breeds corruption and creates an unbalanced power structure. Until and unless accountability is brought into the picture, frauds like NSEL / Satyam, etc., keep on happening and regulators, rather than being conscience-keepers of the nation, would keep on behaving more in the line of SS/Gestapo and focus on harassing entrepreneurs/companies.

Till these steps are taken, budget in India will remain just an annual accounting exercise without unleashing the untamed spirit of the country.

This article was reproduced and was published in Economic Times.

The Song of an Entrepreneur

Awesome poem by Milton Berle. Captures the mind of an entrepreneur –

“I’d rather be a could-be if I cannot be an are;
because a could-be is a maybe who is reaching for a star.
I’d rather be a has-been than a might-have-been, by far;
for a might-have-been has never been, but a has was once an are.”

Of Entrepreneurs, Artists and Signals from the WhatsApp Acquisition!!!

19 Billion, the price Facebook paid for WhatsApp acquisition!!! So while the whole world is still grappling with the price points, pattern seekers amongst us are trying to figure out the perfect template / the secret sauce. (Un)Fortunately, patterns are loud and clear ~ “Pure product obsession / total disregard for market shares, revenue or break-even.” Social media is already abuzz with news about the handwritten note by Brian Acton, Co-founder, to Jan Koum, CEO, about “No ads, No games, No gimmicks!” that has already acquired cult status in the community. The other company that displayed such a mad obsession about ‘Product’ was Apple, which achieved spectacular success as well even with such a limited range of products.

So the big question is – if the wheels are turning and from MBA madness of value creation for stakeholder, are we now going back to the product? Or let me put it this way – Are we now going from number crunching science to the purity of art? James Joyce once remarked that The Artist, like the God of creation, remains within or behind or beyond or above his handiwork, invisible, refined out of existence, indifferent, paring his fingernails.“ Somehow Jan Koum, Brian Acton, Steve Jobs, etc., seem more like artists than anything else and that poses a real challenge to all of us, the template chasers; how to design a template to create a masterpiece of art?

For entrepreneurs, the choice seems pretty simple and logical, that is, to be an artist, as that is what the template says, but things might not be so straight after all.

In a way, artists have always thrived when there is a patron; be it a king or some support system, which allows them to pursue art without worrying about day-to-day cash flows. Interestingly, in modern times, Venture Capitalists have taken up the role of erstwhile kings, where VCs now help entrepreneurs to perfect a product without worrying about revenue or cash flows. But in a ‘no king scenario’ or in absence of ‘VC ecosystem’, one shall rather be a trader than an artist; but then as Joyce points out, a true artist shall be indifferent to the winning itself.

So overall, the signal is loud and clear – that in times of excesses where the patron is either a king or a VC, the artist is going to win, and win big, when capital is not a constraint. While in ordinary times, it is the trader who is going to win, and win big.

Hence, let us raise a toast to these times of excesses, the VCs, and Yes – Oh those mad artists!!!

2014 : Economic Crisis at the Gate

The year 2014 onwards, one is bound to see India facing its worst economic crisis, irrespective of the fact whether Mr. Modi becomes PM or not. Since it is the first time India will face an economic crisis without any luck or local stimulant as Manmohan Singh’s actions (or rather lack of them) have exhausted India of any option, and India is staring at serious crisis without any arrow in its quiver. With 6th Pay Commission stimulus tapering off and with the almost negligible capital formation for last few years, attempts of bringing back growth by having same old & tired textbook measures – like interest rate cuts – are not going to yield any positives. The author argues that the only way India can escape this crisis is by building consumption in short-term and capital formation in long-term, which means taking extraordinary counter-intuitive measures like deflating real estate sector and boosting SME/manufacturing/infrastructure by simplifying rules/reducing the interest rate. 

2014 is here and somehow things look a lot better than what they were six months ago. Political change is in the air. AAP party, in a historical mandate, has been sworn in Delhi, and Raghuram Rajan, the new RBI Governor is making all the right noises. Suddenly from the despair of 2013, we seem to usher in a new year with a lot of positive vibes and hopes. No longer are talks of Indian rupee hitting a new low or Sensex collapse ruling news channels but newspapers are filled with reports of growth in hiring, salary increments and SENSEX hitting 25,000 by May 2014.

In fact, there is a wide-spread hope and belief that Indian economy will go in further overdrive if Narendra Modi / BJP gets the decisive victory which is, at best, a wishful thinking, and at worst, simply a mirage. This thinking stems from the fact or view that India was able to manage earlier economic disturbances on account of smart leadership maneuvers, and hence, coming crisis can also be taken care of by the sheer leadership of Narendra Damodar Modi. Before jumping to such conclusions, probably one needs to understand the Indian context and earlier brushes with economic crisis faced by the nation in a post-liberalized world.

India, despite being one of the ancient civilizations, has a very short history of being an independent state and even shorter history of being a liberalized economic market. This means that as a nation we have hardly any experience of boom/bust cycles as pre-1991, average household budget used to follow Hindu rate of growth governed by a monthly quota of ration and benevolence of state, while post-1991 India has just seen a phenomenal increase in overall wealth and conspicuous consumption.

Though post-1991, India did face an economic crisis in 2001 and 2008, but due to a variety of unintended situations, all these crises failed to make any impact as details below.

Dotcom Bubble and 2001 Economic Downturn

Post-liberalization (1991), the World and India stared at its first recession at the beginning of 21st century, when the dot-com bubble collapsed and 9/11 attacks happened, bringing global economic engines to almost a halt. However, other than some offer withdrawals at Indian management institutes, 2001/02 recession didn’t impact India at all for a variety of reasons. A lot of levers got in play to push the Indian economy on a growth trajectory despite the overall slowdown. Of all reasons, the foremost engine driver was BPO/KPO sector which not only created huge job opportunities in major cities but also absorbed the pain caused by the slowdown of IT industry. While BPO/KPO sector was keeping job growth fast and driving export income, on the domestic front, Infrastructure (road/port, etc.) and telecom sectors were taking shape.

The NDA Government, led by Prime Minister Atal Bihari Vajpayee, focused on building world-class roads all across India and rolled out the golden triangle. On the other hand, the entry of MTNL in mobile services with incoming calls becoming free led to price-drops and super explosion in growth of subscribers.

These two factors, i.e., improved road infrastructure and growth in telecom subscriber numbers, unlocked constraints in the economy and in fact paved way for one of the biggest GDP expansion India had ever seen, and year after year India clocked 7%+ GDP growth. This super rocket growth helped SENSEX break every record every quarter and India joined China in being the darling of fund managers on Wall Street. Billions of dollars were raised by funds to participate in India story. In a way, India had arrived on the world economic stage.

2008/09: Subprime Mortgage Crisis and Lehman Brothers’ Bankruptcy

While India was marching ahead to glory, far far away, USA was busy rediscovering nirvana in housing/mortgage driven by cheap Greenspan dollars whose solution for every problem was a little more liquidity. However, the party soon ran out of fuel and the world was hit by one of the biggest financial crisis with stalwarts like Lehman Brothers going bankrupt and 100s of banks in the US collapsing under subprime load. The whole world went into crisis except one country – India. While the majority of people were led to believe that India survived on account of the leadership of then economist PM; however, the truth is India survived the aftermath of Global Recession more by luck than any other thing, and least by Govt actions.

In 2006, Indian Govt without any idea of the upcoming 2008 financial crisis, set up 6th Pay Commission to review and revise the salary of Govt employees. The Commission came with its report in 2008 and released arrears in 2009-2010. This commission impacted almost 20 million Govt employees (Central and State Govts) and resulted in an annual increase of INR 12,561 Cr per annum (USD 2.5 Billion per year) and one time arrear of INR 30,000 Cr (around USD 6 Billion). As expected, this worked as mini-stimulus, as almost all of it went into auto and housing sector. The table below is almost self-explanatory where one can see growth in sales of passenger cars which witnessed the largest increase of 27% in the year 2009/10 and 2010/11, while the commercial sector was hardly growing. 

image

However, lack of any new initiative and slowing down of the economy due to policy paralysis resulted in almost zero job growth scenario and impacted car sales. Automobile sector faced slower growth in 2011-12, which turned into negative growth as automobile sale decreased every month in 2013.

2013 Onwards: Of NREGA / Fiscal Deficit and Real Estate

The year 2009 saw the re-election of Dr. Manmohan Singh led Congress Govt, which made analysts believe the beginning of another golden era since the government was no longer at the mercy of mercurial left parties and a prison to their economic agenda. It was expected that government emboldened by its electoral win, will unleash economic reforms, which coupled with GST and DST will catapult India much ahead of China.

However, in a karmic turn of events, all deeds of UPA I came to haunt UPA II. Bad moral hazard expenditure, like NREGA, increased labor cost for marginal farmers, thus created supply-side challenges while 6th Pay Commission returned to haunt Govt in the form of the high fiscal deficit which ballooned to 6% from earlier range of 2.5% to 3.0% in 2006.

Hence, despite all the talk of big revival and growth, India, in fact, is in the middle of a crisis as is evident by the following:

  • The automobile sector is seeing negative growth: 9-month consecutive drop in sales. Leading companies like Ashok Leyland, Tata Motors, etc., are cutting production schedule and realigning workforce.
  • Telecom sector after posting consecutive growth is now slowing down and is no longer front end driver of the economy.
  • Infrastructure remains in the middle of nowhere as no large projects are being announced while earlier projects which had absorbed billions of dollars are yet to see the light of the day, thus creating a real crisis for investors as all invested capital remains locked as an unproductive asset.
  • PE funds who had invested big time in Power / Infrastructure and roads in 2007-09 are yet to see any return of capital and majority of investment remains under water.
  • PSU banks, which helped real estate sector weather the storm in year 2009 by restructuring loans and saved it from big crash, is again staring at next level of restructuring, since the real estate players got greedy post-2009 and led to a price growth of 3x in the last 5 years and focused on EBITDA protection rather than cash flow management.

Real Estate – The Double Whammy

Real estate in India remains an interesting asset class, which has given best returns among all asset classes since 2000 and continues to rise despite the call of bubble burst now and then. In a way, the real estate sector in India, while showcases success and growth, also symbolizes as whatever is wrong with the Indian economy. Today, the real estate sector poses the following challenges:

  • Very high housing prices in comparison to median earning. Housing in India is expensive or at par with housing cost in the developed world.
  • Debt level at real estate companies is at an astronomically high level where some of the companies, like Jaypee Infratech, have a very high level of debt posing a systemic risk to Indian banking sector, as noted by RBI Governor in a recent statement.
  • Real Estate sector growth has to lead to jumping in housing prices by 5x to 10x in last 10 years while rentals have also jumped by the same level, though salaries have not kept pace at the same level. Today, the majority of free cash flow at the household level is going either in EMI payment or rent, which is restricting discretionary spend and thus creating a slowdown in consumption.

Road Ahead

As one can see the Indian economy is facing a unique crisis of having high inflation and very low growth. This unique scenario has made limited options available to RBI, which anyway never moves beyond Keynesian models. High inflation will eliminate the possibility of a rate cut as there is this naïve belief in India that low-interest rate will fuel inflation and will further impact growth. The powers in finance ministry need to understand that India is not west and does not have the luxury of enormous resources as well as well-oiled supply chain. Inflation in India is not a function of more demand but supply-side constraints, which becomes worse with higher interest rate and crony capitalism.

The only way Indian economy will find wings again is if real estate sector collapses (price reduction of 30% to 50%) and help to unlock all productive capital locked there and manufacturing becomes friction-free, which is the elimination of red-tapism and paperwork for small and medium enterprises.

So in a nutshell, RBI and finance ministry need to reduce interest rates for SME sector and agriculture while doing away with housing loan interest tax breaks, increase interest rates for housing by at-least 300 basis points for the additional house. Till this is done, the local economy will remain sluggish and will not witness any fundamental shift at grass-root level and 2010-2020 will be more of a lost decade than an Indian decade.

We All are Hitler, We All are Buddha

We all are Hitler, we all are Buddha,
It is not they are some other,
It is just we, who vacillate between one and the other,
Is it a moral choice to choose one,
Or just inability to choose one?
B’coz somewhere deep down there,
We are still the one, with mistaken identities –
We are all Buddha, we are all Hitler.

                                                   ~ Written in 1999 at Mumbai 

An Entrepreneur’s Diary… Thoughts on a Long Road to Building that Next Big Company!!!

Came across this piece by Diana Nyad who swam from Florida to Cuba (full 53 miles) at the young age of 64.

I think nothing captures the struggle of an entrepreneur more beautifully than this note by her where she captured the ordeal of swimming for 15 hours. I think every entrepreneur will recognize this pattern where he struggles with short-term reality to achieve long-term dreams.

“Imagine swimming continually for fifteen hours. Fifteen hours in rough, cold ocean water. Fifteen hours of unconsciously doing the same stroke that you have been doing since you were 10 years old. You can’t hear because of the caps, and you can’t see because of the dark, fogged goggles. You can’t think because the human mind is not geared to focus for any lengthy period of time, so your thoughts drift into delirium, and soon, time is more distorted than ever. As far as you know, you are in the middle of nowhere, and any effort you might produce to stroke again won’t necessarily bring you any closer to your goal, because much of the time you can’t remember what the goal is. It is clear that your ordeal is without end, and there is only one thing you somehow sense — that the choice to abandon the struggle and climb aboard the ship would be to fragment your pride beyond repair. Survival is keeping one’s dignity intact.”

Source: The New York Times

अग्निपथ! अग्निपथ! अग्निपथ! – The Startup Anthem

वृक्ष हों भले खड़े, हों घने, हों बड़े

एक पत्र छाँह भी,

मांग मत! मांग मत! मांग मत!

अग्निपथ! अग्निपथ! अग्निपथ!

तू न थकेगा कभी!

तू न थमेगा कभी!

तू न मुड़ेगा कभी!

कर शपथ! कर शपथ! कर शपथ!

अग्निपथ! अग्निपथ! अग्निपथ!

यह महान दृश्य है

चल रहा मनुष्य है

अश्रु-स्वेद-रक्त से

लथ-पथ! लथ-पथ! लथ-पथ!

अग्निपथ! अग्निपथ! अग्निपथ!

(Poem by Harivansh Rai Bachchan from “Madushala”)