From the makers of the ubiquitous Stag umbrella

Fast Company has an interesting write up on the change in strategy by the makers of the Stag umbrellas. If you’re from Mumbai, you need no further introduction to the ubiquitous, black Stag umbrellas and the reasons to own one.

Threatened by cheaper products from China, the company switched from a low cost strategy to differentiation – offering specialized, high-quality products. The timing couldn’t be any better, the Indian consumer can definitely afford a premium on personalized umbrellas. On the other hand, corporates will be more than happy to give out branded umbrellas for free.

How much can you hate?

I watched Anurag Kashyap’s Black Friday a couple months back, and I’ve been wanting to write about it. Kudos to Anurag for making this gutsy movie. The movie has been reviewed by many, so I really have nothing to add in that space. But I’ll say this – if you watched the movie and didn’t feel a sense of renewed patriotism and a rush of adrenaline, there’s something wrong with you!

I couldn’t but wonder if there’s anything I could personally do to bring justice to Mumbai bomb blast victims. If nothing else, create an online site with a “hate meter” that encourages users to vote for the most hated person. And take it a step further and attach a utility to that hatred, e.g. I’d say Dawood Ibrahim in jail is worth a $1000 to me personally. A few thousand participants and now you’re talking. I even found a site that asks its users “How much do you hate this Tory”?

So why didn’t I work on the idea? A couple days later, the rush of adrenaline was gone. That kind of hatred is impulsive and short-lived, not sustainable. If it were sustainable, I’d be one of those people blowing buildings and market places.

Imagine India: Macy’s brings Lord Ganesha to SFO

Walking around Union Square in San Francisco, I was surprised to see a huge Lord Ganesha sitting on top of the Macy’s sign. Apparently, the SFO Union Square Macy’s has a flower show every year. The theme for their 61st annual Flower show was “Imagine India”.

They got it mostly right – 20 feet Ganesha in front, windows decorated, lots of silk and Indian cotton apparels in the store, and of course the Indian tricolor fluttering on top of the store. You wonder what’s the business incentive – it wasn’t additional foot traffic. Cultural capital, maybe?

India Unleashed 2007

Notes from the The South Asian Business Association (SABA) conference at Columbia University:

India shining:

• 50% of India’s population is under 30 years old
• India #1 in milk production and #2 in fruit & veg production
• Hindalco – World’s #1 Aluminium producer
• Mittal – World’s #1 Steel producer
• Reliance invests 22M in Chevron, Dow Chemicals and few other US based companies

Challenges facing India:

• Bringing 600M non-urban population into the mainstream
• Building infrastructure – 350B dollars invested
• Power Crisis – the culture of “free power” has to go
• Water shortage
• 50% illiteracy in Bihar & UP
• 5.7M HIV infected (projected: 50M deaths/year by 2050)
• Education & Health – address social infrastructure problems
• Agricultural productivity and inefficient supply chain – new retail chains like Reliance Fresh & Bharati-Walmart should help eliminate inefficiencies in raw produce procurement from farmers
• Nuclear threat and inflammation a huge threat (India’s nuclear weapons capability annual expenses = 0.5% of GDP – Amartya Sen in The Argumentative Indian)

Arun Shourie, former Disinvestment Minister and former editor of Indian Express, emphasized that every Indian is a reflection of India; non-Indians look at us and develop an impression of India and Indians. On a lighter note (joked Shashi Tharoor), don’t be alarmed if an American walks up to you with a broken laptop at the airport.

• Economy steadily growing 9% YOY
• Exports growing 23% every year
• Forex Reserves touch 200B
• Remittances into India 24M/year
• 6M new mobile subscribers/month

But then…

• 98% of parliamentarians voted on minority vote
• 60% voted into parliament by less than 40% voter turnout

Shourie’s Quote of the Day: While India is not the land of snake charmers anymore, we also can charm snakes.

Shashi Tharoor stressed upon the significance of nation’s “soft power” – the ability to influence or persuade other nations without military power. Soft power could be derived from spreading culture and awareness (Bollywood and tourism), political values (biggest democracy and secular governing body) and foreign policy (credibility).

Move over “melting pots” and “salad bowl”, the thali is here.  Tharoor used the thali as an analogy for Indian diversity – assorted platter, yet each its own.

Marketwatch inline widget

Testing the Marketwatch inline widget… click on the tickers to view it.
Yahoo (YHOO), Google (GOOG), Infosys (INFY), ICICI (IBN), TI (TXN).

What do investors look for in a start-up?

I attended an entrepreneurial forum at Stern recently. It had 5 VC’s on the panel sharing their wisdom and experiences on what VCs, angels and private equity investors look for when investing in start-ups. Some takeaways:

Quality of Idea

• Defensibility (Intellectual property)
• Revenue addition or multiplication (little equity required)
• Huge profit margins to accommodate startup mistakes (especially for all those ad-supported and freemium business models).

Quality of Team

• Domain expertise (how long have been in the industry)
• Start-up Expertise (VCs always love your 2nd venture)
• Relationships with other players in your space
• Passion – willing to risk everything for the start-up.

Business Plan Pitch

• Presentation – keep it short & crisp; 1-pg executive summary. Why you? Market size? Break-even analysis?
• Background – Industry trends, competitive analysis, mitigate risks to get from pt A to pt B.
• Style – VCs in a long-term bond with the entrepreneurs, hence looking for open-minded, fun people.

Story – Have your pitch down.

Personnel – Highlight why your team/management is good.

Opportunity – Research the market.

Opposition – Research all contra points, failure scenarios.

Finance – Releastic 2-yr revenue projections, not 5-yr pie in the sky numbers.

Valuation

As much as you should have a realistic valuation of your start-up, one VC suggested that it is really their job to valuate the company. Why? If your valuation is too high, you’re being unrealistic. If your valuation is too low, you lack research and confidence.