In the fiction soap “Breaking Bad” a 50 year old, penniless, high school teacher Walter White, without any drug background, could make this statement: “Do you know what would happen if I suddenly decided to stop going into work? A business big enough that it could be listed on the NASDAQ goes belly up.”
Silk road’s 29 year old owner Ross William Ulbricht handled a billion dollar worth of transaction in drugs in mere 2.5 years. He was an average geek who operated out of a public library, and perfectly blended with the crowd.
These 2 people completely changed the popular perception of a flourishing drug empire. Unlike what is depicted godfather or mafia movies, they did not carry guns, or had a huge network 50-100 of sworn, loyal followers who are willing to die/go to prison. They did not have an elaborate international logistics network to source and distribute, neither had they had the state of the art technology & intelligence network needed to run the empire. They did not have a pool of corrupt DEA/law enforcement agencies to tip them off.
These 2 stories are stories of 2 outsiders, newbies in an otherwise organized industry. In the industry that was considered stable & mature, they infused fresh sparks of ideas. Sometimes a little hard work and a lot of passion is all it takes to turn the dreams to reality.
I am sure most of the readers have neither consumed drugs nor know how to access silk-road/ Tor network or have a bitcoin wallet. I am not glorifying this industry, rather am trying to extract few words of wisdom & analogy from this ocean of sin.
How do you define entrepreneurship? I measure it on the following 2 scales.
1) Innovativeness, ability to anticipate the changing trend and find a unique solution. One size does not fit all.
2) Having the dignity towards labor and understanding what you do is not important, but what difference you make is important.
3) Ability to scale up this enterprise to increase revenue many folds.
If I look at the rich and well to do, I see them opening up new malls, high-rise buildings, bridges and industries everyday. So most of them have a vision, grand plans and they live to complete them. The era of Tata, Birla where richness was due to inheritance is gone. Most of the Indian richest are self made man.
I was also amazed to find the level of entrepreneurship in the common Indian. If there is a Parent-Teacher meeting, or admissions queue in front of the school, tens of hawkers will swarm the place. Each of them have a unique eatable to offer thus placating the taste buds of everybody. If there is a water-logging, immediately youth will form gangs helping the car-drivers roll the cars to safety. Even before an office is opened, a Pan shop and a tea stall opens up right in front of it. Most tourist places have multi-lingual guides who not only speak their native languages and English, but also the foreign languages. No organized enterprise even in developed countries can match the speed with which they customize their offering to grasp the new window of opportunity. The security guards of most buildings double up as car washers, milk/newspaper delivery boys to earn extra income demonstrating that even people who have a stable source of income keep their eyes and ears open.
Unfortunately most of these success stories are not scalable. If you meet a small time entrepreneur after a decade, most likely he will still be doing the same job, will have the same number of wares. For someone who always thought that taking the first step is like completing half of the journey, this was an eye opener. However little research found a variety of reasons why they failed to grow:
1) The acid test of any business is cash flow crunch. Most enterprises fail not because they were not profitable, but because they could not manage their cash flows. Indian govt, by their postal schemes which pay 2.5% above the bank rates, suck up a lot of free capital.
Banks which have the best information about the credit rating of the people shy away from their duty of lending. They prefer to keep the money in treasury bonds instead of issuing business loans.
2) Harassment: Most people have to pay Hafta/protection money to either local mafia or police, sometimes to both. Not only it kills the spirit of free enterprise, but these people act like parasites damping the whole environment
3) Black money in Indian society: A lot of under the table transactions happen in Indian society. Unless the owner himself is involved, there is huge likelihood that he will also get duped. This is the single largest factor why there are not too many professionally managed enterprises.
to be continued…..