Disparities in confidence

As the world progresses, with growth comes disparity. It is impossible to consistently achieve growth without compromising on equal distribution of wealth and opportunities. And this is because of basic human nature. Every human being, by his very nature, would seek the advancement of his progeny, his clan, his blood. That's the way the world evolves. It's your instinct. People generally try to boost their children's chances in various fields to succeed in life.

Education is one of them. Children of affluent parents would get opportunities to study in the best of universities. We can't imagine that all the industrialists' sons and daughters are smart enough to get into the Whartons and Harvards of the world. Whether they deserve this or not, or whether they make use of it or not is an entirely different matter. So, obviously, they are assured of a good label as far education is concerned.  

Social connections is another area. By virtue of moving around and being associated in elite circles, you are naturally exposed to a higher citizenry, or rather, a citizenry that is in an advantageous position, compared to the masses. You can't get that otherwise.

But above all, it is confidence. The confidence that comes from having more money at your disposal, having more wealth, having a fallback in case you don't succeed the first time around, having a higher springboard in life. And this confidence is reflected in all actions and activities of life. Right from driving a car to talking to a group of people, they are less restrained and more natural. That confidence is really the clincher, the key differentiator.

You can't reduce disparities in confidence!

Charity or Save the world; be politically correct!

After a short day at office yesterday I was leaving home soon since I had to go to the bank to foreclose my car loan. I was at Vikhroli station in a hurry, when I was stopped by a young girl, about 20, who represented Greenpeace. And she asked me politely whether I could listen to her for a few minutes. I agreed.

She briefly described what Greenpeace was and what they were working on. I told her I knew quite a lot about Greenpeace, but didn't tell her that one of the projects my company was working on was delayed because of activism by Greenpeace.

I asked her how I could help, the response to which she delayed, continuing her script to conclusion. I was getting impatient, wondering what was it that she wanted from me. I thought of asking 'Do you expect me to save the world here?' but I blurted out 'How can I help?'. She had to come to the point. Contributions begin at Rs 250 a month, conveniently chargeable to my credit card.

She almost concluded that I would save the world, sorry, contribute. I said I can't decide contribution standing here at the station at an odd hour. I asked for their website and details and said I'd update her whether I contribute or otherwise.

I wondered what was it that drove this young girl of 20, possibly, to stand in the afternoon sun and promote a cause which may or may not benefit her. And thats not enough, lest I sound like a irresponsible citizen of the world. I'm sure this girl doesn't understand the complete story, nor does she know whether she is on the right side of the world.

I concluded that she was doing it to earn brownie points. Maybe she was going away to America for further studies. Maybe she needed the experience on her application.

Is this is a good cause to be associated with for that? With all the controversy surrounding such activist organisations, it may not be a safe bet. I mean, someone opposed to this idea, with a reasonable understanding of the scenario (which this girl lacks) will be able to win an argument.

I had never had the need to be associated with any such cause for brownie points, so I can't comment on the appropriateness. But this led me to think whether one should choose a safer alternative, such as an old age home, women's issues, children in orphanages or the like, where you could only be right. After all, most in the world choose to play safe.

That would be so politically correct!

Does Twitter make money?

I've been fascinated and intrigued by whether website companies make money. Google may have 'non-intrusive' and 'relevant' advertisements, but I can't imagine they making any decent margin. Just think of the costs that they incur, maintaining these huge servers, the electricity costs, the airconditioning required to keep them cool, all for storing stuff that is at least 90% junk and unwanted. (In a separate post, I would like to discuss how much of junk the world might have created).

Youtube stores videos, Flickr stores pictures, and Scribd stores documents that add up to many gigabytes. So for all of this, the expense would be enormous. As I can think, any number of non-intrusive advertisements and sale of personal information cannot make up for this.  

Twitter is a more recent phenomenon. It may have the benefit of being much modest in terms of size, since it restricts messages to 140 characters, has no images or videos. But with its popularity growing and the number of posts increasing at an exponential rate, it will be in trouble.

The one aspect that is different about Twitter is that it has no advertisements whatsoever. And by the language of what is written, I'm sure they can't figure out any pattern that they could use to sell your information, at least as of now.

It has succeeded in building a following of enormous proportion but hasn't done anything to capitalise on that yet. It could've easily put up advertisements, at least on its website, though many may be using the mobile application.

In the social networking world, it has achieved what very few have. To have so many tweeting away in such a short time is worthy of recognition.

I can see a few sources of income possible in the future. As for other such players, they could study patterns in tweets and generate targeted advertisement campaigns to select groups of individuals. They could be 'sponsored' tweets. In fact, they could have these sponsored tweeters following you.

As Google has reached out to the masses with their AdWords initiative, twitter could do the same. That way, you could have these small and medium businesses follow pertinent potential customers. This may work in the developed world better.

As a finance professional, I think they would securitise their future expected streams of income and leverage that to expand today, thus feeding their growth. Whether it will work, only time till tell. Whether it is desirable, I can say no now.

Since it runs predominantly on mobile applications in the developed world, I suppose they may have a tie-up with mobile service providers for a share in income generated because of tweets. This is yet to catch up in the developing world.

The interesting part in the case of Twitter is that they have a set of venture capitalists who have funded them. I'm sure they must be expecting and demanding a share of the pie when the cake is baked and ready to eat.

It'll be interesting to see where this leads. Till then, tweet away!

Google offline

Google is reaching out, offline, to millions of Indians and Indian businesses.

As google expands into newer emerging markets, with lower internet penetration, and lesser computer literacy, the concept of small companies also seeking to advertise on the net is lower. And google's survival and growth depend on advertising revenue, after all. So they are now reaching out. And they are reaching out through snail mail, offering vouchers to companies to sign in.

Till now, Adwords provided all the revenue to google. And it is driven by a vast majority of small firms that provide advertisements to google, that are thrown up with search results.

Google realised that India has an estimated 80 million internet users, while it has at least half a billion mobile users. So, obviously, there is a different currency that has more reach that what google trades in. And google is attempting to convert these many millions.

According to research firm Access Market International Partners Inc., India has around four million small and medium enterprises, or firms with a workforce between 10 and 1,000. They are expected to spend $18.6 billion (Rs85,000 crore) in 2010 to buy computers, build websites and connect to the Internet.

Google has built most of its business online, indexing information on the Internet so it can be searched easily. Only now has it digressed from this model to go offline, and to build products, including a mobile phone named Nexus One.

Montessori method

Esmeralda Davis runs a Montessori school in east Bangalore. Montessori method is where a child is allowed to develop according to his or her natural inner directives, through self-directed learning. The school allows students to choose their activities, make discoveries about language, art, mathematics, music and culture in non-graded classes of mixed ages. As I read more about this method, I am impelled to explore this and see if I can become a practitioner.

I'm reading about this on the back of 3 Idiots taking the entire country by storm. Even if the movie manages to change a few lives, it would have been a great service. After watching the movie a couple of times, I have a noticed a certain gap that the movie leaves unaddressed. While it is recommended that we do what we love, it doesn't address the point that our system does not allow a student to find what he loves to do. That would be possible only with a system of counselling and discovery that spans over many years, depending on how much time an average student would take to find his or her true calling.

The Montessori system seems to provide the solution. We need to do what we love, no doubt. But the education system needs an overhaul to ensure that we know what we love. Otherwise the current education system is capable of ruining our natural instincts and direction. I'm reminded of a t-shirt quote 'I was intelligent, but education ruined me'. How true! 

I'm off to understand and discover more!

Google tribute to Newton

The google home page today is creative brilliance. On the event of Newton's birth anniversary, they have come up with a fitting tribute. One of the O's of google is replaced by an apple, which drops when you open the page. I log in to google at least once every day. Of all the concepts they've used over the years, I think this is one of the best.

Reclaim my life

The new year is here. And we go through the usual motions of resolutions and promises to lead a better life. No different this time around. I made a few motherhood statements, decided on a theme for the years to come. For the first time in many years, I was becoming seriously aware of the fact that I had more productive years behind me, than ahead of me. Thats in terms of count! And the only way I could make my future count more than my past is to ensure that I live the same life more! 

A few incidents have been encouraging in the past week. The run up to any new year is always good. You decide to start a new life and plan to do all the right things once the new year begins. And all that you experience in the last week before the new year appears encouraging. I had enough experience from the past of resolutions not making it any beyond January. So this time around I decided to just move quick and sure in the direction of a better life.

I looked back at 2009 and found that I had very few real achievements that made the list. So I refrained from writing a long laundry list of ideal things that seem so daunting that they sure will tire one.

I just decided on a theme 'Reclaim My Life' inspired by an automobile ad. Someone then told me you had to have measurable goals, but I didn't want to fall into the trap of aiming too wide and high and not reaching anywhere. So I'd decide on a few goals every month, review them at the end of the month, and add to the list as I go by, with some success, I hope and wish.

Procrastinate

Procrastinate is defined as 'to put off from day to day, to delay, to defer to a future time. As I read this, the word doesn't seem to carry a negative connotation. Then why is used in that sense? Another misused word, quoted out of meaning!

And in today's information overload environment, hectic work-style, procrastination is a necessity, and may be the right thing to do. With more technology, we are able to handle more. But demands have also increased manifold. We allow ourselves to be interrupted and disturbed in more number of ways than ever before. And reminders and follow-ups have become the norm.

If you don't procrastinate, you will have to act on all your deliverables, without assigning priority, and it will require us to multi-task. And there is nothing more inefficient that multi-tasking.

The word 'procrastinate' is so benign, so harmless, even necessary. But its usage is incorrect. However, that doesn't mean there is no problem. We have probably used the word to describe a wrong problem. In reality, the problem we are trying to describe could be one of lack of planning, inefficiency in execution. By using a word that means something else, we are actually misreading and misrepresenting the real problem.

So what do we do about it? Lets discuss that some other day!

New York! New York!

An exceptional Mumbai-bred mathematics student is convicted of threatening to kill George Bush and other ministers over his web post. The FBI has filed a case against him based on messages on a Yahoo site, and they believe that the statements calling Iraqis to avenge war on their country by America, were sent from his computer in his university.

That's Vikram Buddhi! He has already spent two and a half years in jail, and has apparently been the target of racially motivated violence. He is looking at 35 years, if convicted. And people believe he is innocent and wrongly held.

This is another example of a possible over-reaction by America post 9/11. A subject very well handled by a recent Hindi movie 'New York'. We saw that movie a couple of weeks back again when it ran on television. The treatment of the subject is very mature. And I like the character played (very well) by Irfan Khan.

Especially two lines. One where he says that it is only a person within the system can restore the confidence lost. And the other where he says that this is the country in which you can still expect a migrant's son to captain the baseball side. Somehow, the way it is said invokes a sense of belief and leaves you assured that things change for the better.

We may or may not agree with what is said. And what was said could be untrue. But in the context and presentation, it appears justified and logical, depending on how liberal your viewing lens are. The current episode of Vikram brought back memories, and gave another reason to not believe!

Business and Finance are very different

Last week, I happened to attend a seminar on treasury and finance organised by EuroFinance at Taj Lands' End, Bandra. Ajit Ranade was the keynote speaker. He spoke about the current financial situation in brief. He also quoted an article that Michael Kinsley wrote in the New York Times in 2007 when Warren Avis of Avis Rentals passed away. An amazing article which I was forced to search and retrieve on the net. I reproduce the article below. I was reminded of the many times we discussed about the importance of the real as opposed to the derivative, about the cake rather than the cream, about drink rather than the fluff. Read the article. I needn't say more.

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We Try Harder (but What’s the Point?)

By MICHAEL KINSLEY
Published: May 16, 2007
Seattle

IN 1946, Warren E. Avis (who died last month at the age of 92) had an idea: rental cars should be available at airports. So he founded Avis Airlines Rent-a-Car. In 1954, he sold the company to another businessman, Richard Robie. Two years later, in 1956, Robie sold Avis to an investment group led by a company called Amoskeag. In 1962, the investment banking firm Lazard Frères bought Avis. In 1965, Lazard sold Avis to the giant conglomerate ITT Corporation.

Since 1946, Avis has been sold or reorganized 17 or 18 times, depending on how you count. Each time Avis changed hands or structure, there have been fees for bankers and fees for lawyers, bonuses for the top executives and theories about why this was exactly what the company needed. 

In 1972, ITT spun off Avis as a publicly traded company. Then, in 1977, the company was bought by another giant conglomerate, Norton Simon. In 1983, a company called Esmark (formerly Swift & Co.) bought Norton Simon. In 1984, Esmark was bought by Beatrice Foods, and in 1986, Beatrice was bought by the leveraged buyout firm Kohlberg Kravis Roberts & Company.

Kohlberg Kravis Roberts immediately sold Avis to an investment group called Wesray. Wesray sold Avis’s fleet leasing business to a company called PHH Group. Then it spun off Avis’s foreign operations and took them public as a company called Avis Europe P.L.C. And then, in 1987, Wesray sold Avis to its employees under an employee stock ownership program. Wesray more than tripled its money in 14 months.

Two years after the stock ownership deal, the company sold General Motors a complicated security that effectively gave it a 26 percent stake in Avis. Apart from that, Avis’s employee ownership experiment lasted nine years, until 1996, when Avis sold itself to a company called HFS. Employees got an average of $26,000 each. Eighty or 90 current and former Avis executives got an average of $1.75 million each.

A year later, in 1997, HFS took Avis public. (The initial public offering raised just over $330 million. The banker Bear Stearns charged $15 million for its services.) In 1999, Avis bought PHH. Remember PHH? That was the company Avis sold its fleet leasing operation to in 1987. PHH was owned by Cendant, a company that had been formed in 1997 by the merger of HFS — right, the company that had spun off Avis in 1997 — and another company called CUC. HFS had retained 19 percent of the company’s stock when it took Avis public. With the stock portion of Avis’s purchase price for PHH, Cendant now owned 34 percent of Avis.

A couple of years later, Cendant bought the roughly two-thirds of Avis that it didn’t already own and made Avis a wholly owned subsidiary.

In 2006, Cendant split itself into four independent companies, one of which was the Avis Budget Group. (Somewhere along the line, Cendant had also acquired Budget Rent a Car.) The Avis Budget Group became the parent company of Avis Budget Car Rental.

Modern capitalism has two parts: there’s business, and there’s finance. Business is renting you a car at the airport. Finance is something else. More and more of the news labeled “business” these days is actually about finance, and much of it is mystifying. Even if you can understand — just barely — how it works, you still wonder what the point is and why people who do it need to get paid so much. And you strongly suspect that the swirl of financial activity around Avis for the past six decades has had little or nothing to do with the business of renting cars.

Last September, a week after the Avis Budget Group began trading on the New York Stock Exchange, The Wall Street Journal reported that the new company was “ripe for the picking.” Carl Icahn, another wily financier from the 1980s, had acquired a $100 million stake in the company and would not comment about his intentions.

The Journal warned, “If a buyout or acquisition deal doesn’t materialize for Avis, stock and bond investors will have to focus on the fundamentals of its car-rental business.” Goodness! Anything but that!


Michael Kinsley is a columnist for Time magazine.


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