Equity & Debt

Equity is forgiving and ignore all sins / exuberance while creating reward for all parties but debt like truth is stark, doesn’t allow even marginal error and generally destroy all, its rewarding only to disciplined souls or one backed by again unlimited equity.

Flirtation with debt has rarely ended well be it individuals, corporates or nations.

Debt which ideally shall only be for creating capital assets or meeting capital expenditure, always end up funding consumption or revenue expenditure, and hence doesn’t end well.

Debt require discipline which by design Nation, corporates rarely have as the cost is generally not paid by the one who take the decision of debt. Hence its a asymmetrical proposition – all rewards but no pain and for next in command all pain and no rewards.

In the time of Euphoria

We are all at a wonderful ball where the champagne sparkles in every glass and soft laughter fall upon the summer air. We know, by the rules, that at some moment the Black Horsemen will come shattering through the great terrace doors, wreaking vengeance and scattering the survivors. Those who leave early are saved, but the ball is so splendid no one wants to leave while there is still time, so that everyone keeps asking, “What time is it? What time is it?” but none of the clocks have hands.

                                                                               ~ Adam Smith, SuperMoney

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