Yeah! I got a double spread in the Economic Times today!
Enjoy Dhoom - 188.8.131.52 !
By the roar of the searches on google, I’m confident that the Bollywood movie Dhoom 3 is probably going to break all the records in box office history. I haven’t watched the movie and probably never will (errr…because I have this snobbish South Mumbai attitude to maintain), but Dhoom 3 is a breakout story of 2013. Simply explained, the box office collections of this single movie is more than the annual profits of the Britannia (biscuits) company of last year, and that goes to prove that Bollywood has more than made the cookie crumble!
What else do I think made 2013 memorable and worthy of nostalgia in the years to come? Consider:
‘Crowd sourcing’ everything – your wallet, brains and reputation!
The Aam Aadmi Party (AAP) of Arvind Kejriwal (no relative of mine) redefined ‘crowdsourcing’ in 2013. Till some time ago, outsourcing had become passé. It was the dirty thing American companies did with Bangalore IT companies that earned the wrath of US Presidents and the global western world.
Crowdsourcing was more elegant. It was the process of letting crowds do your work, and often not paying them for the same! Take for example the gargantuan website Wikipedia.org that has entirely been written by knowledgeable enthusiasts, without any compensation other than proving their love for their subject matters of expertise.
Arvind Kejriwal took crowdsourcing to a completely new, Dhoom level. His public approach of asking for donations; requesting volunteers to canvas house to house to spread his party’s message; employing Twitterati to shower social media with their tweets; and using anyone’s idle brainpower to deliver extra intelligence into his campaign is a shining example of the power of crowdsourcing.
What stunned me was AAP’s decision to use crowdsourcing to even ask if the party should assume power given the deadlock in Delhi! It was the equivalent of Gabbar Singh asking his companions how he should treat ‘Thakur’!
Take away for 2014: Make the crowds your friends, not your enemy. Make ‘em sweat for you and collectively enjoy the fruits of their labour!
Losses are sexy! Marwaris please note!
As an astute Marwari, I taught myself the secret science of the ‘parta system’. It's an esoteric accounting method that calculates the profitability on assets, investments and projects. Once you get a hang of it, it’s easy to look at any complex business and break it down into mini, micro and macro costs to determine the profitability of each division or department.
Wait, did I just say profits?
Well, if I were to apply the parta system to the splendid business of Flipkart.com, my brain would catch fire and smoke would emerge from my nostrils!
Flipkart’s epic raise of US $360 million (almost 2000 crore rupees) this year itself, to aggressively finance and build their massively loss-making but fast-growing business, is another Dhoom moment of 2013.
As per the last accounts filed, Flipkart stated that it loses almost Rs. 25 crores a month and yet is valued at Rs. 7000 crores in valuation! Yeah – make no mistake in the number of zeroes. It’s Rs. 7000 crores!
Are you rubbing your eyes thinking that your hangover is playing games? Nope! You are reading the new sutras of how businesses of the future are being shaped and built! Globally, loss-making, new-age businesses are now considered absolutely holy. Venture Capitalists take pains to zero-in on highly talented entrepreneurs who blow up billions of their dollars in losses just to build scale; and do the impossible to compete with e-companies. This is the way the mighty Amazon has been built and this is also the tune Flipkart will dance to all the way to its international IPO, despite not showing any major profitability.
Take away for 2014: Stop fretting about profits. Think of massiveness, of King-Kong-sized business operations, of delightfully enthralling customer services and develop a business like Flipkart that can change human behavior forever, no matter what the cost. That is the real profit – not some crummy bottom line that most Dalal Streeters consider fake anyways.
Tried by Social Media; Sentenced by the Courts.
Can you imagine a Tarun Tejpal-like moment just five years ago? Or a Justice Ganguly embarrassment being exposed even two years ago?
Social media are the new trial courtrooms of India. Whatever you do, say, write, sms or whisper is capable of being published within nano seconds on web media for the world to read and react.
When Osama Bin Laden was killed, the world first found out via a tweet from Abbottabad. It was a simple, innocuous tweet that made the world breathe out a long deserved sigh of relief.
Today, the volume is on full blast. If an innocent lady is being harassed in an auto rickshaw, all she does is take a few snaps from her camera phone and shares them on social media, tagged to the location of her troubles. Within a few hours the culprits are identified and rounded up.
Social media behaves like a tsunami, high on drugs. It is out of control, beyond jurisdiction and ownerless. It consumes, converts, punishes, damages and destroys in seconds. And like all great tsunamis, the damage created is often irreparable.
Takeaway for 2014: Befriend and beware of social media. If you are one of those lazy grey haired foxes who still use a black dabba called Blackberry, go and microwave it for 3 minutes. Then throw the microwave away and get yourself some modern day equipment that connects you to the social media tools of the modern world. Learn, curate and exist in the ocean of social media and do nothing irresponsible that makes you encounter its deadly tsunami.
The rise and rise of funny money! Raghuram Rajan, lend me your ears…
Have you used a Bitcoin? Better still have you mined one? Have you allowed your customers to pay you in Bitcoins?
If you don't know what I am talking about, then you are a Tyrannosaurus.
Bitcoins are the coolest and most sophisticated invention in modern day monetary economics that I can think of. Restricted, controlled, capped and cleverly appreciative, its creators could very well give Manmohan Singh and Raghuram Rajan a few lessons in creative financial thinking. It's a currency solely produced by computers via a secret complex code and is made available in small calculated tranches to ‘miners’ (not the guys involved in Coalgate) who ‘mine’ these virtual coins, deploying massive computer power.
Bitcoins can be used in the real world (a café in Worli has just started accepting them) and they are becoming increasingly valuable with every passing day. They are Dhoom, Dhoom!
Way before bitcoins existed; a currency called ‘RAAM’ was introduced by Maharishi Mahesh Yogi’s Global Country of World Peace in 2001 in the Netherlands. It was an alternative currency that even today is accepted by over 100 shops there. While introducing this currency, Maharishi’s spokesperson said,"There are 1.5 billion people living in extreme poverty and currencies like the US dollar are not available to most of them. The Raam can be used to build new houses, roads, schools and health clinics." Simply put, “Who says that the dollar or the rupee are the only currencies that work?”
The message in the bitcoin rage is the rise of what I call ‘funny money’. It’s real money that's made available in a funny way. It’s an economic expression that folks like me really enjoy using.
Unfortunately, the RBI thinks very poorly of such inventions and does what it knows best - it curbs them. This is typical of a stubborn institution unwilling to learn and adapt. A case in point is how the RBI has made it impossible to use the ubiquitous PayPal in India despite the fact that the world has converted to it years back!
Takeaway for 2014: Institutions wake up! The world is getting younger and young people don't like what their grandfathers played and paid with. They have their own tools of trade and they will bring them along, for you to either accept and profit or reject and lose. Funny Money is here to stay – it’s time you developed an economic sense of humour.
Starting up is the new Bollywood.
Over the years, you may have heard of umpteen stories of starry-eyed boys and girls who wandered from their small towns and arrived in Bollywood to become heroes and heroines.
The new Bollywood is now ‘Starting Up’.
Wandering away from IITs & IIMs, from cozy dollar jobs and confirmed job placements; thousands of young Indians want to ‘do their own thing.’ They want to be their own Aamir Khan in their own Dhoom! Across the country, 2013 is the year in which the largest number of young Indians have ditched regular ‘career paths’ and have been venturing into dark woods of the unknown.
What has created this massive culture shift in the minds of Indians whose parents develop cardiac arrhythmia when they hear their kids speak of ‘starting up’?
It's the stories of redBus (a local bus ticketing site that sold for 600+ crore rupees within a few years of starting up), of Sachin Bansal of Flipkart earning over Rs. 10 crores in one year (in salaries and esops) as co-founder and of the success stories of hundreds of Indian entrepreneurs who have made it ‘big’ in the ‘valley’. Young, restless Indians are reaching out for success that doesn’t seem impossible to achieve.
Starting up lets young people achieve three things: It lets them convert their passion into a profession; become their own boss and seriously take a shot at creating something they will be really proud of. Almost like a script out of a Bollywood movie!
Takeaway for 2014: If you are involved with the young, set them free. Give them the chance of creating something they think will change the world and empower them do so. Let them try and fail and try again. Be a part of their Dhoom script and become a hit together!
Perfect !!! Makes total sense ... Loved the part which said ..
Institutions wake up! The world is getting younger and young people don't like what their grandfathers played and paid with. They have their own tools of trade and they will bring them along, for you to either accept and profit or reject and lose.
Excellent read. Loved every part of it. And Alok loved your humor sprinkled all over.
Awesome read Alok sir..
So Time to roll the AloKoins ? :D
Liked the part : The Aam Aadmi Party (AAP) of Arvind Kejriwal (no relative of mine) redefined ‘crowdsourcing’ in 2013
How is that really Possible ??? Entrepreneur Entrepreneur, Bhai Bhai ? (Could be Behen Behen or Bhai Behen too in other cases) Relatively!!
We might Finally have a Dhoom 4, after this post / article!!!
Awesome Awesome Read!
Hi Alok sir, Thanks for sharing it, you know, I read it in ET without realizing you've written it, but soon while I was reading it , I told myself, it sounds so much like Alok Kejriwal, and when I saw the author, it was you... .Thanks for being there :)
Thanks Alok for this amazing post and thanks for sharing.
Surprised with the Flipkart valuation and losses part! How can they survive then?