Gravity and Oxygen: Makes all the difference

I remember that in school, when we went to the local science museum, there was a machine that calculated our weight on the Moon, Mars, and many other planets.

It was fascinating to see that our weights differ! I still remember that our weight on the Moon was 16.5% of what we weigh on Earth. 

Someone who weighs 100Kgs is only 16.5Kgs on the Moon :-) That was a very interesting titbit. It still psyches me though... The concept of gravity. How gravity is different on different planets, and so our weights change based on that.

We were taught of Earth as the "Goldilocks" planet as it had a stable atmosphere, viable oxygen supply, the right amount of sunlight, and water for the sustenance of organisms. 

That, we were told, was why we could only live on Earth and not Mars...or anywhere else.

Well, now, let's take that analogy and move into the stock market:

We are seeing a sudden fall in the stock markets - lots of reasons, some relevant, some not so relevant. 

Quite a few stocks have corrected in the last few days. Certain themes have taken a tumble of 5-10% in this week alone. 

A lot of story stocks were trading at 100x P/E and some even more when there are no earnings, but only projected earnings... 

100x P/E means you are extremely sure of earnings growing rapidly for many many years ahead and are supremely confident of the quantum and trajectory of growth... I've always wondered how you can be sure of something 20 years down the line when you are unsure of what happens a week or two from now. 

People change, companies change, directions change, and all sorts of things can happen. How can someone be so sure. Where is the margin of safety??

Anyway, I'm digressing.

At the end of the day, the way you value a business is by estimating the future cash flows it would produce, and discounting it back to today.

Essentially, we are looking at two variables - 

(a) What the asset would produce yearly -- Cash flows

(b) What is the rate at which the cash flows get discounted -- Interest rate

With feds and central banks finally looking at curtailing inflation, rate hikes have come in. With (b) going up, the value of assets needs to come down. Interest rates are like gravity. Higher the rates, lower the asset value...

You see, gravity brings down the weight?

Though it is to be expected, it is always the lack of visibility of earnings, extra caution creeping in, and a sense of the unknown which causes liquidity to disappear, leading to prices falling indifferently.

Who knows how to perfectly value future cash flows...

Anyway, nobody knows how much something falls. The future is always uncertain. 

But, as we're taught in school... Oxygen does make all the difference for sustenance. Oxygen typically in the world of stocks is the availability of easy money. 

Nobody thinks of oxygen, but it makes all the difference when it is not present. It is the same as liquidity to the market. Nobody cares about liquidity as long as it is abundantly available.

When liquidity tightens, uncertainty gets heightened due to a sense of pessimism. One becomes less certain of future cash flows. 

That is our problem today. Both these together create issues. Uncertainty creates doubts. 

We start looking at everything during times of uncertainty. Government policy (China-US), Oil price, Covid (still?), and Ukraine-Russia issues (last I checked, they were <2% of world GDP) among others. 

All of these do cause uncertainty. Some of the factors are more relevant - Oil prices for example, which a country like India is heavily dependent on; more than others...

But, all of these affect the way we perceive the future unfolding and with it, the movement of interest rates, and the certainty of future cash flows.

What can we do?

We humans always love to hear a story. Who doesn't like a story with that fantastic twist at the end? Something that will change the world.

I certainly do like a good story. And so do you. But, we also know that change and growth are usually slow. There are always bumps on the road. 

It is better to look at realistic storylines of companies as the future always holds a range of possibilities. It is better to stick with a future that is conservative, but directionally positive. Something that might not change the world today or tomorrow - but, over long periods, will lead to a massive difference.

What am I doing?

Usually, when I have made a good purchase, I just don't want to do anything. Most of my errors have been in doing something - typically selling early. Notional price movements should not always dictate actions. Sometimes, not doing something stupid is better than doing anything at all.

Again, Earth is a Goldilocks planet due to a combination of factors. Of course, Gravity and Oxygen are key ones, but many others are needed like the right amount of water, sunlight, environment, atmosphere, etc, etc. 

Many a time, stock portfolio construction is also a work of art. This needs to have the right amount of order and balance. 

Deploying extra cash I have, sitting quietly and deeply looking at any potential themes, and not unduly changing anything... is what I am trying to do.

Well, here is an old clip of Buffett that seems to so succinctly summarize the situation:

Ciao till next time...Harsha

Magic: Compounding Over Long Periods

My son and I were reading the newspaper earlier today. He is 10 years old. An article piqued his interest - Elon Musk taking over Twitter and how he is shelling out $40B+. He knows that Elon Musk is the richest man today with ~$250B. 

He seems more interested in finding a way to make money himself. Here was our conversation:

Son: How much is a $1B? 

Me: It's roughly Rs. 7,500 Crore

Son: Well, I'll start a company and will make more

Me: OK, good. Get working

Son: Anyway, how much will my piggy bank grow if I keep investing that?

Me: Let's calculate. How many years do you think you'll live and what interest rate will you grow your money at...?

Background: He's seen the simple compound interest calculator, and he's played around with me. His piggy bank is fully invested in stocks which he picks with me. He seems to like valuing companies we come across.

Son: 90 years (80 years ahead of him), 20% every year

Me: Yes, you'll get to a $1B+ with what you have, if you grow that without touching it (I'm leaving out the exact $B)

Son's not too happy having that when he's 90 years. We'll see what he does to get there sooner.

It's magical to see how money snowballs. He seems to get the concept. Now, let's see if he can really grow that at 20% YoY and if he does not lick into the honey pot.

That's for time to tell. 

Ciao till next time...Harsha

Exponential Growth: A Curious Case

I hate popping pills. Especially if something needs to be taken regularly. All sorts of pills have taken a foothold into our lives. Pills for blood pressure, diabetes, fat burn, protein supplements, and so on and so forth. It is like someone controlling our lives, and you can do nothing about it.

A magic pill that can cure anything is just what we are looking for. Though I hate pills, I love the pharma business. It is here to stay, and it is here to grow. Exponentially.

Here is a curious case of the Dolo-650

The one magic pill for fever, body aches, general weakness, or anything which causes you discomfort, is not there. 

But the belief is: if you're not really sure of what caused it.... take a Dolo! It might just help you. 

Or so, some of us believe. Yours truly included. I've popped a Dolo in the past year like so many others.

With Covid raging, the only over-the-counter drug that seemed always available, readily trusted, and used was Dolo. I was surprised how it became a household name in India.

I tried purchasing generic paracetamol when my mother was having a bout of Covid in 2020. I was told to only trust the one highly effective paracetamol, by the local pharmacist - "Dolo". 

When you need medicines for your family, you don't typically bargain on price, you go by what works. 

If the guy selling medicines says it works, you tend to believe him and pay a premium (50% more than the generic 500 mg Paracetamol).

I decided to dig a little deeper after the incident. It turned out to be a very interesting case indeed. I wanted to write on this topic since last year but kept putting it off. Well.. I've got to write it now. 

I recently read an article on Micro Labs in Fortune and it triggered back what I had researched myself.

Micro Labs (a privately held company based in Bangalore), was one of the many manufacturers of the common paracetamol. Their foray seemed quite unspectacular until the mid-90s. They were one of the many paracetamol manufacturers in the already crowded space.

Their "Aha!" moment came up when they differentiated their product by introducing a rather queer product size. The 650 mg Paracetamol product, christened "Dolo-650".

All Paracetamol products were sold in the standard 500 mg packaging. 

The brilliant idea of a 650 mg dosage was the result of focusing on the small set of people who really needed to take a dose of paracetamol due to high fever! 

Most people with light fever tried not to take pills. High fever warranted a higher dosage, and an extra 150 mg really helped!

Anyway, where is the growth?

Though Dolo was an effective fever reducer, it was a fairly steady product that sold a million strips (of 10 tablets) every year until 2019 for the Suranas (the family that owned Micro Labs).

All that changed, when Covid hit. I read estimates that they sold 3.5 Billion pills during Covid and are growing rapidly in high double digits YoY since.

They seemed to have now cornered a crowded generic paracetamol market with a slightly differentiated, modestly innovative product. 

Dolo is no longer a paracetamol 650 mg pill, it has got a brand of its own.

Paracetamol in India is now called "Dolo". This seems like the Xerox moment for them. A photocopier even today is called a Xerox machine. 

What got me really interested, is the philosophy of the Surana family (Dilip Surana) in a recent interview which I want to summarize here:

• Differentiation and branding (in this case, with medical advisors and doctors)
• Consistent quality
• Consistent messaging

Nobody can predict when exponential growth can hit in, but it was interesting to see a small domestic manufacturer corner a commodity market in the face of strong overseas competition (GSK) which had 10X more firepower.

Indian Pharma is ripe for more 10X's - I wonder who is next? The search will always continue. 

I just wanted to stop by, and tell you the unexplained story of "Dolo", the magic pill!

Ciao till next time...Harsha

Afghanistan - Winds of change?

I started reading about Afghanistan in 2001. I think most of us did not know much about them before 2001. And, after that - many of us have come to associate one of these names when it comes to that country - "Taliban", "Al-Qaida", "Osama", "Islamic State", "Bamiyan", "9/11 sponsors", etc among others..

Not any of them denote positivity. I want to just pen down my thoughts about how the world is changing and how Afghanistan might be the turning point in Geo-Politics.. Let's get started..

Down the memory-lane..

If you go back many centuries, Afghanistan was a key central region at cross roads of the fabled silk road. Roughly 30% of the world trade happened on the silk road. It formed sort of the gateway into both India and China from the West. Any European trade had to cross this part of the world. Over the centuries, this region has seen its ups and downs. The only other equally important trading junction was - Israel; at the confluence of three continents - Asia, Africa and Europe. 

Anyway, in short, the Afghans of those times were Businessmen. Let's look through the ages...

Pre-Islamic Era:

Let's head back roughly 1500 years. 

I was reading the translated accounts of the traveler, Hsuan Tsang (the Chinese Buddhist monk) who spent close to 2 decades traveling into India to collect the Buddhist scriptures from the ancient Indian kingdom ruled by king - Harshavardhan. 

The year was 630 AD when Tsang supposedly entered the kingdom of Bactria-Samarkhand (times when the Indian kings still ruled the place). The place was bustling with activity and he describes this part of the world as: "This is a rich land, where the treasures of distant countries accumulate, where there are powerful horses and skilled artisans, and the climate is most pleasant". 

Supposedly, just like tourist attractions of the current times, religious monuments attracted tourists during those times - so, lo and behold, the wily Afghans had build their own state of the art Bamiyan Buddha as their tourism mainstay. For centuries, the region was a bustling economic hub, tourism hotspot!

Supposedly the Buddhas of Bamiyan were a flourishing pilgrimage during those peaceful times. The silk road was not too harsh to travel and it had brought prosperity to all the lands between Europe and China. This part of the world seemed to be at the cutting edge of technology - the first high speed cross-asian postal network, canal systems (which were still running from the Greek times of the old kingdom of Bactria and Samarkhand), top-of-the line orchard farming techniques (Citrus farming was somewhat of their monopoly)..etc..

I am digressing.. let's move forward fast.

The Islamic Ages:

The region saw  Islamic conquests after Tsang's visits and subsequent capture - the Abbasid's during 800 AD and post a small relapse (when the Hindu kings recaptured the area), Muslim rulers from Samanid's onwards have had the area under their tight grasp.. 

However, even during these times - The Bamiyan had supposedly thwarted attackers like - Genghis (1200's), Babur (1500's) and Aurangzeb (1800's). 

Post the 1500's - the importance of the region had anyway fallen.. mainly due to the greed of the later rulers charging hefty fees for the usage of the silk road (by the many mini-states of the middle east)... 

The Europeans felt that it was much better spending money on exploration in the 1400's to find a safer sea route to India. By the time of 1600 AD, the region had lost out to the cheaper, more safer (from attackers) and easier (no hassle of middle men) sea routes... That supposedly put an end to the prosperity to the land. Alternate sources of revenue - farming, mining, etc never really took off due to the apathy of the rulers...

Moving fast ahead into the 20th century.., lack of education, lack of opportunities, hardships, feudal farming system, among other things, lead people to bend more towards extremism. 

The feeling that somehow God will intervene when things go wrong, leads people to look more towards God-men than Good-men. 

Taliban (Religious students) captured most of Afghanistan by the 1990's - it's ironic that the movement itself started as a student uprising against the warlord stooges of US and USSR!

Post 2001:

2001 was when most of the world stood up and took note of Taliban. What 1500 years of attacks could not accomplish, Taliban achieved the full destruction of Bamiyan Buddhas with the use of dynamite within weeks in March 2001. 

It is ironic that Mullah Omar, the then leader is supposed to have said - "If the statues were objects of cult for an Afghan minority, we would have to respect their belief and its objects, but we don’t have a single Buddhist in Afghanistan, so why preserve false idols? And if they have no religious character, why get so upset? It is just a question of breaking stones."

The slick businessmen of Afghanistan of the 600 ADs would be turning in their graves looking at their descendants blow up their own cultural heritage. 

The 9/11 attacks of 2001 sealed the fate in one way for the Taliban. By the end of 2001, US and its allies had taken over Afghanistan and for the first time in decades, >50% of the population could breathe a sigh of relief (women and children)..

I am no expert on Taliban or Afghanistan. How things have panned out post 2001 need to be told by someone in the region. What anyone writes, will always be reflective of what their biased views, opinions and world-views are..

With a new centrist US backed regime coming in; much was expected. If anyone were to be asked in 2001 as to how they feel their country turns out in 20 years, most would have been super optimistic. They might have build castles in their dreams. In reality, nothing much seems to have changed.

2021 and beyond:

There are many questions which come to mind when looking at the way Taliban recaptured the country they lost 20 years back. 

It does not seem like they had to fire even a single bullet. Within a week of US leaving - they seem to have captured most of Afghanistan. How could that be even possible without massive local and international support...?

To put that in perspective, the Olympics was held for a little over 2 weeks. Taliban were able to capture the whole of Afghanistan in less time than it took for the 2021 Olympics. 

Here are some questions that come to my mind:

• Could the US not build a self sustaining rulership in 20 years? Was that not enough?
• Where did the $90B/yr get spent? 
• Who has got the $2 Trillion (just to put that in perspective - its comparable to Apple, Amazon or Microsoft) that was spent by the US?
• Are the taxpayers in the US not going to question where this money of theirs went? Down the sink hole?
• Usually, money gets transferred from one to another. Was the US just bribing people, with massive corruption, where contractors, military agents, NGO's gobbled up trillions of dollars!?
• Does this event signify end of the $ as a tool for diplomacy while RMB takes over? China seems to have increased their presence while US goes down
• The Chinese media seem to have been rather quiet.. what's building up there? Has the CCP taken note of their new role?
• Is this the inflection point where balance of power tilts firmly in favor of China?
• It seems Taliban has already got their act together building fairly close economic ties with China, how will China react?

What you and I see on TV might be just the tip of iceberg. The world seems to be changing fast. 

We may not be really seeing the reality. It does seem to me that this can end up as a wake up call to all of the world, that US is no longer the power it was. I fear this might end up hastening the removal of US as the dominant world player. 

I shudder to think what the second and third order effects of this are. The decade of 2020-30 is definitely going to throw up some Googlies! What implications does this massive debacle hide?

It seems, nothing much has changed for Afghanistan in 20 years. But, a lot has changed for the world because of the US pull out....

Ciao till next time...Harsha

A Reflection: Pause, Rewind and Reflect

Pause. Rewind. Reflect. The answer is always in front of us. As elusive as it seems, it is quite self evident. 

Man's problems as Blaise Pascal, the fresh philosopher said wonderfully "stems from his inability to sit quietly in a room alone".

This is a short post. Here's an old favorite poem from W H Davies on Leisure. This so represents the need to stand, pause and understand that we are a small piece of puzzle. Nature has so many things to teach us.

Ciao till next time...Harsha

What a garden teaches you. And, the stories we tell ourselves.

This blog is  vaguely divided into two parts. One on gardening. The other on stories we believe in. Both are relevant; as living through Covid-19, life has made me think about both. So, here goes..

The recent Corona scare and ensuing lockdown has given me some much needed time to reflect and ponder. What am I doing, where am I heading, am I... doing the things that matter and, finally, am I doing them correctly.

These and many more would come to mind when you are able to spend time with yourself. 

2000 yrs ago, Marcus Tullius Cicero said something which comes to mind - "If you have a garden and a library, you have everything you need in life". Cicero was a champion of the Republic in the late Roman republic era 100BC. His works on philosophy, rhetoric and general cultural humanism rediscovered in the middle ages were one of the key ingredients for the Renaissance in Europe..

Since, we never really had a house which we could call our own... living in rented houses - I never really got the time and energy to grow a garden. I never had a way prove if Cicero was right. Two things changed that over the past year - 1) Buying a house 2) Getting the drive to do something useful.... especially, when you don't have anywhere to go through the week - for many, many weeks. Painful weekends with no activity.

Yours truly can safely confirm, that, what Cicero said long ago is 100% true. A library was my prized possession - having always treasured the fact that learning.. is a lifelong pursuit. Garden, on the other hand - usually, was restricted to some potted plants in balcony (that typically, struggled for life... with limited sunlight, and as I realize now, some over-watering).

Anyway, coming back to the Garden. Gardening is truly a pleasurable and a learning experience. Gardens are truly a representation of paradise on earth. Paradise, by the way, comes from the Persian word - "Paradizia", which essentially refers to the mythical walled garden during the classical, Achaemenid times. 

Here are my learnings from growing and maintaining a garden - 

• Sunlight, water and nutrition - are the three most important ingredients - 95% of the equation of life
• There is magic in life - when you create the environment - all sorts of life comes in..
• Beetles, song-birds, spiders, all sorts of insects and butterflies find their way - all they need is food to eat
• We had song-birds - pair of nightingale, lay eggs in their nest in our garden.. what a beauty... A thing of beauty is, indeed, a joy forever
• Opportunity and environment comes first. Performance comes with opportunity (that's a big lesson for me)
• What you sow - is truly, what you reap.. effort comes before result. Always. 100%
• Same plants can grow differently depending on what ingredients you provide - one can turn into a bonsai, and the other into a larger plant (I am trying my hand at creating bonsai's - if you want to learn - Ayan's a great coach)
• Anyway, there are no shortcuts - if you plant fruit trees - they take a year to give first fruits. No way on earth - can they bloom faster.. just because... 'you' provide extra nutrition
• There is no way around waiting. Once the environment is right, nutrition is right - you need tons of patience. Just because its your garden... the plants don't bloom faster

Anyway, let me come back to the other theme I want to touch upon today.  The last 6 months has busted some stories, which I think, we are used to. 

We tell a lot of stories to ourselves. We need $x million..., kids are costly..., social life is super critical..., Govt has the power.., authorities know better than common man (especially this is untrue..), remote work is not possible.., yadi yadi..

Most things are untrue. Man is a very adjustable animal. Technology can change things very, very fast. Much more than we can imagine. Amazon can take over the whole of retail - hell, they just did. In 6 months. Boom.

If its not for technology.. we are all monkeys playing around. Technology will change the world. Old business models need to give way to new. Moats can evaporate. Just like that. Be careful, what you think are the worst case situations, or the best case. Is it really that? 

Be careful of the stories we keep telling ourselves. Some learnings for life, living through Covid-19 times:

• Most things, which we are used to collecting: hoarding money, things we need, etc are more than sufficient to lead a good life. We over-estimate what we need
• 5 pairs of clothes are more than sufficient. So, too with shoes
• Home food is good. Eating at home, 7 days a week is totally fine...
• Pareto rule - 80% of the things that matter, take up 20% of time.... is 100% true. It is important we do that 20% though
• Kids don't need too many toys. They need our time
• Clarity of mind is very important. Sometimes, work from home - becomes 90% work, 10% home. Balance is important, we need to find our balance
• If you spend sometime on what you truly, truly want - world conspires to assist you
• Helping others, gives you immense satisfaction - you have to try that often, very often

I hope, you are encouraged to create your own garden. Always be clear of the stories you tell yourself. They are truly powerful, as mostly; we believe in them. What we truly believe - we have the power to make it happen.

Ciao till next time...Harsha

Balance, Order and Harmony: A work of art, is joy forever!

I am a big fan of Monty Don - ever since I started watching his shows, I have been smitten by the gardening bug.

It's a great pleasure to walk in any of the great gardens and the palaces of Italy. I never could pin point what was that one thing which gave the gardens its character and panache. Walking around in some of the great gardens there... brought about a profound sense of peace and wonder.

Recently, I started creating a small garden on our terrace. I have been getting inspiration from some of Monty's Italian Garden's series.

Building a garden is like a work of art. Building anything in one's life that needs to sustain is a work of art. Like John Keats said, "a thing of beauty is a joy forever" - so too is your work of art..

Monty Don's Garden series takes you to a different world. I strongly encourage you to see the four part series from Monty on Italian gardens. If this does not awaken the sense of mysticism and wonder about nature, I don't know what will..

You see...some of the greatest works in the modern era - music, painting, architecture, science and invention, printing, war making, expansionism, learning, industry... emanated from the renaissance era!

Come to think of it - it was a reawakening of the Greek and Roman era in the modern times which gave suddenly, the somewhat backward nation-states of Europe - a new purpose and direction.

What started as an artistic pursuit in the 14th century lasted until the 17th century and left the world a very different place. Europeans, decisively took the lead from Chinese and Indians post renaissance. There was a new sense of direction and purpose where there seemed to be backwardness before.

Great prosperity is typically preceded by times of reawakening of art and culture. Some of the greatest gardens in Italy were created during this time. The way the gardens were made, give us some learning on how to build somethings which can last.

The great gardens' of Italy have lasted 300+ years and will likely last many more. The trees and flowers are long gone, but the style and texture still remain.

One of the things which has profoundly impacted me in recent past is that one thing which all the gardens seem to have in common....

Like Monty says - In every direction, you see balance, order and harmony. There is something in them... that still has such a powerful resonance with us today. The thing that strikes you immediately when you walk in is the symmetry. 

Everything is balanced. Whatever happens on one side is picked up on the other side. The result is harmonious, and you can feel it, you can feel this sense of lightness, of generosity that is completely prepared and ordered and laid out. 

And you might think that that would be dull and predictable, but actually, it's not. The whole point of that is in every direction, you see balance, order and harmony. 

Renaissance thinkers were exploring classical scientific principles, and one of the beliefs was that God created the world along mathematical lines.

The renaissance gardens give us a great lesson to learn - that... that which is created to last, has to have a sense of balance, a sense of purpose. All, built with a sense of love and great harmony filled with delight.

Let us build our pieces of work and art... that unfinished painting, which we want to build to last... with great balance, order and harmony. 

Amen. Long live Monty Don!


Ciao till next time...Harsha

Running your own race: Understand Inner scorecard vs. Outer scorecard

Life is a single player game. It is not a multi player game. The things which really matter.. the ones which really really matter are internal, not external.

"The reality is life is a single-player game. You’re born alone. You’re going to die alone. All of your interpretations are alone. All your memories are alone. You’re gone in three generations and nobody cares. Before you showed up, nobody cared. It’s all single-player." - @naval

Warren Buffett asks a question if people behave the way they do to please others or play by the gallery because they want or have to? Are people satisfied with an inner scorecard or an outer scorecard? He often asks a simple question: "Would you rather be the world's greatest lover, but have everyone think you're the world's worst lover? Or would you rather be the word's worst lover but have everyone think you're the world's greatest lover?"

When you compare yourselves to others - you allow them to drive your actions. When you are young - it could be that you compare yourself against that kid who topped the class, or ran the fastest or played cricket the best or something else like - if only I could have been a little taller - I could have become a better basketball player. Some of these are trivial comparisons which lead to better performance, but most give headaches which you could do without. Knowing the limits of comparison is usually not easy.

The other day, I was comparing my two kids - who is going to be better academically, who can be a better business person, who would do better at something - why can't one be a little better here and so on and so forth.

Typically when you compare, and you end up short - it is because you are comparing their best features versus your own ordinary or mediocre features. In a sense you end up playing the other person's game.

A few years back, before I hurt my leg in a freak accident; the one thing which I really enjoyed most was running. Running 10K's and half marathons was very enjoyable. You tend to think about various things and mentally relax when you run for a long time.

The thoughts in mind are not about being faster than the person running next to you or to finish the race ahead of someone else - when the race is long, essentially it becomes a race against yourself. Setting yourself against your old best self. Setting a yardstick which you yourself had set and seeing if you can better that.

When you start comparing like that, you essentially try to become a learning machine updating your previous system with a better version. Its like getting a new software on an already existing hardware.

The question really is - what game would you want to play and what would you rather pass?

I was rambling around. But, that is really the question. It is really hard to think along those lines. Many a times, we die without thinking. I think most people would rather die than think :-)

Can you really beat Gary Kasparov?
Off-course you can. Just pick a game that's not chess. Maybe cricket which I'm sure he has no idea about.

Would you slog at work trying to please your boss? How can you become better at work?
Maybe yes, if you like your boss :-) Better still, pick things which you really know you can do well and maybe be world class in that small area.

It's important to cover fatal flaws (especially if you need domain knowledge to be successful), but really find those niches where you are best in class. Best in the world.

Knowing where to play and what to play?
The most important things in life are really measured internally. Does helping someone give you pleasure, does doing something scientifically or in engineering or being a medical doctor or fighting fires gives you pleasure? These questions are essentially very much determined by your nature, skill sets, temperament and the real "you".

Playing the wrong game is easy. That's essentially what most of us do. We may even win the game. But, how does that matter... winning the wrong game :-) It basically would be meaningless and pointless.

Thinking about what game you want to play is hard. Playing that is even harder. Pleasing the crowd at a common game is easier. Easy, crowded games are not very fulfilling. That's the way you can end up being mediocre. Most of us do end up there.

Know your game. Play your game. Help others play their games. Life's not a multi player game. Its a single player game played by multiple people who are playing their own games on the same playground.


Ciao till next time...Harsha

Endurance and Permanence: Test to Survive and Thrive

I have been thinking of writing this for a while. It has really struck my mind how and why something can endure and thrive over such a long period of time.

Wait. Let me back up and tell you the story.

During our visit to Srilanka, we visited Anuradhapura - the ancient capital of Srilanka and visited the remarkable Maha Bodhi Tree - a sapling of the Great Bodhi Tree under which Gautam Buddha attained enlightenment (to start the 4th most followed religion today) - that has stood ground for 2,300 years.



It was the year 288BC when this tree got planted by the Indian King Ashoka's daughter Sangamitra. For the next two millennia - many things have come and gone, but the tree has stood ground.

Srilanka was ruled by Devanampiyatissa during that time - one of the first noted kings of Srilanka.

For the next few centuries his followers made Anuradhapura a great city rivalled by few other cities in the world - Babylon in Iraq, Alexandria in Egypt, Carthage in North Africa (still a mighty kingdom preceding Roman empire) and Pataliputra in India (still a go-to place for higher education in the ancient world).
  
The great libraries of Alexandria were just getting constructed during this time. The Mauryan empire still stretched from the modern day Iraq / Afghanistan to the woods of Burma.

The first villages in the valley of Rome were getting built once people in the valley got a hang of growing the ancient strain of wheat and barley on a dependable seasonal river water harvesting!

Just to imagine seeing a living contemporary of monumental historical events is akin to blurring the passage of time or just like pressing a historical pause button or even rewinding the clock to see that similar things existed in those times.

A lot of things have happened since that time and its remarkable the tree has stood ground.

Anuradhapura was the capital for many centuries post which it was abandoned due to many reasons - draught, lack of military might, weak rulers, etc.

In the meantime - the original Bodhi tree was either cut down or naturally died due to passage of time.

Anuradhapura itself was abandoned as a marauding Chola kingdom of South India was flexing its muscles in the 13 - 14 centuries. A group of Buddhist monks are known to have stayed back to keep the tree going as a holy site.

More recently - in 1929 a man determined to cut down the tree cut-off its biggest branch. Terrorist attacks in 1985 killed over 100 people - though hurt on both occasions - remarkably, the tree managed to survive and grow!

This brings me to the important question of just what has made the tree survive for so long. History teaches us a lot of things and there are useful tips here.

I want to map out the parallels to companies where as investors, managers and leaders - it makes very real sense to follow the nature's guidelines. Here are the top tips for endurance and permanence - the elixir of life so to speak.

1) It is not always the strongest, largest or the fastest which survive the longest

It is a profound thought that has left me pondering. The tree certainly looks very old - but it has the extreme resiliency which is remarkable to bear.

It is no secret that the longest surviving companies in the world are the beer makers in Germany, wine makers in France or alcohol companies of Japan which have survived for many centuries. Neither did they branch out or dilute their core-competency.

The fighting spirit - the ability to keep relevant and be resilient and influence change instead of standing upto it and dying are key aspects.

By design - Amazon's and Facebook's of the world will get disrupted - fastest and strongest don't really bear the test of time. Social media or internet based purchasing may come and go - something else will be the newest toys in people's hands.

2) The remarkable ability to bear pain 

A lesser tree that's over 2,000 years old would have fallen down when its biggest branch is cut off. It is said - a lot of old people die due to complications when they go under the knife for a surgery. The actual ailment may be cured. Complications, side-affects do arise. They are lethal. Usually.

In the scheme of things - bad things happen over a long period of time. When the times are good - every Tom, Dick and Harry would do well.

As Warren Buffett says - "It is only when the tide goes out - do you see who is swimming naked".

The ability of companies, individuals alike to bear the pain of forces - draughts, competition, attacks, weak and crooked management, poor decisions, etc - is very important.

The core-competency, ability to focus on what matters and most importantly that which results in the ability to take pain are the key.

3) The do-good, feel-good aspect. Being a net positive in the scheme of things

A lot of positives go your way when there is net positive being delivered for humanity. A lesser tree which has no value - spiritually and mentally would never have got taken care off by humanity at large!

Survival and indeed thriving in nature is only possible when the entire ecosystem benefits by the particular subject in question.

I was researching how some of the family businesses thrives over many centuries inspite of weak ROEs, low growth and cyclical profitability.

They invariably bring some very real good to the entire ecosystem in which they operate. How and where we bring value to the entire ecosystem - suppliers, partners, employees, customers, society and humanity at large are very real questions to have clarity on when looking at aspects for companies operating today.

Nature finds a way to keep the net positives to ecosystem alive - as long as the value add is noticeably greater than value destruction.

In conclusion -

It is very important to remember the words of Spinoza - "You have to look at things in the aspect of eternity". 

Long term vision is very important to stay relevant - plan for next 2 Qtrs is usually present with most companies. Few if any look at what happens a year, 2 years and 5 years or more out.

As, the saying goes - "The stone age did not end due to lack of stones".  Staying relevant, focusing on what matters - core-competency, ability to take pain and being a net positive for the ecosystem are important corporate tips.

Finding constant relevance - in the current and future scheme of things is very important.

Ciao till next time...Harsha

The curious case of grabbing everything: Givers vs. Takers

We recently made a move from US to India. As most moves go - there is a lot of packing, shipping or giving away involved.

I observed a curious behavior when it came to taking things. Obviously, you would want to sell things like - car, furniture, etc where possible. We were lucky selling off the cars and some furniture.

Most others - my wife and I decided to give away. Obviously, you would want to give things away to people who may need it. Like the student who reached out and wanted the golf set, neighborhood children who wanted the cycles, etc. Those are the perfect match.

For most others - you just post pictures / items on Craigslist for people to come pick what they like and leave. My wife had atleast dozen pictures of items to be given away on Criagslist - mattresses, household items, kitchen items, electronics, furniture, etc. It took a couple of weekends to clear away.

Few things which I observed:

• Most people wanted to load up on things just because it came free! A few who came by took everything which was kept to be given away.
• In the purest form, there are very few people who would say - let me just pick the crockery set and leave the carpet for someone else.
• We had Asians, Indians, Whites and Blacks come by. 
• I did not see a difference in any one set of people when it came to aspect of taking things for free.
• There were cases where I asked if they would like to pay and buy something which was not put in the give-away list (like the sofa for example). After the first two times, I stopped asking.
• There are a some who are very warm and enquire why you are giving away! They stop by and wish you the very best.
• I was surprised to see our kids give away their toys when we told them we did not have space to carry everything back. 
• Don't expect a thank you from people all the time. Some want to just carry as much as possible which leaves them very little time for anything else.
• Then there are those who advise you not to move to a 3rd world country from a 1st world country. I had the guy who was picking up our mattress (for free) tell me why I am better off in the Bay Area all the while when helping him load the stuff.

The process helped me learn a lot about human behavior. Altruism is something which gives you a good feeling about yourself. If only that can be made more targeted, that will be awesome! Read more about my experience being a recipient of someone else's goodness - Altruism: Helping others with no expectation in return.

There is a good book on givers vs. takers which talks about this topic in terms of professional success. I couldn't summarize this better than here - To Give or Take? The Surprising Science Behind Success.

Ciao till next time...Harsha