Entrepreneur Diary

यह हार एक विराम है
जीवन महासंग्राम है
तिल-तिल मिटूँगा पर दया की भीख मैं लूँगा नहीं
वरदान माँगूँगा नहीं

स्मृति सुखद प्रहरों के लिए
अपने खंडहरों के लिए
यह जान लो मैं विश्व की संपत्ति चाहूँगा नहीं
वरदान माँगूँगा नहीं

क्या हार में क्या जीत में
किंचित नहीं भयभीत मैं
संधर्ष पथ पर जो मिले यह भी सही वह भी सही
वरदान माँगूँगा नहीं

लघुता न अब मेरी छुओ
तुम हो महान बने रहो
अपने हृदय की वेदना मैं व्यर्थ त्यागूँगा नहीं
वरदान माँगूँगा नहीं

चाहे हृदय को ताप दो
चाहे मुझे अभिशाप दो
कुछ भी करो कर्तव्य पथ से किंतु भागूँगा नहीं
वरदान माँगूँगा नहीं

  • श्री शिव मंगल सिंह सुमन

The Entrepreneur

मैंने उसको जब-जब देखा
लोहा देखा
लोहे जैसा तपते देखा
गलते देखा
ढलते देखा
मैंने उसको गोली जैसा चलते देखा

~ केदारनाथ अग्रवाल

Job less Growth & Booming Share markets

Are businessmen turning investors?

No longer mid-size /SME entrepreneurs investing in their own growth/plant expansion etc.

However same capital is finding its way to investments in – Mutual Fund, Share markets, Real estate and a tiny bit in startups!! as the rate of turn and paperwork in own business is lower than returns from investments.

This sums up all mystery of jobless growth in a booming share market.

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!!!

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