What You Know About Startups Is Wrong, book review: Puncturing the myths
VC and serial entrepreneur KP Reddy offers advice, anecdotes and common sense in this useful, if somewhat discursive, book. Can anyone be an entrepreneur and create a successful startup? If your best idea is bed sheets you stick on with Velcro, or renting your dog out to lonely strangers, probably not. In fact, says Atlanta-based venture capitalist and serial entrepreneur KP Reddy, even with the right idea most people are doing startups wrong. If you’re annoyed by VCs spouting off about how you can’t expect to succeed without living on instant noodles and ‘crunching’ 80 hours a week, this somewhat rambling book of advice and anecdotes will be a welcome change. In What You Know About Startups Is Wrong, Reddy pushes back on the startup myth that real commitment means overwork and no time off. It’s certainly refreshing to hear someone maintain that your startup is not your child, and that you shouldn’t put it ahead of your life and your family. “We’ve decided collectively as a culture that startups equal pain”…”Startup culture glorifies struggle and tenacity,” says Reddy. Maybe it would be better to make a realistic evaluation of your opportunities and progress, because one of the first lessons any founder should learn is when to quit. After passing out in a low blood sugar diabetic crash on a plane, and realising that hanging on to his failing startup at all costs after the dotcom crash had cost him so many personal and professional relationships, Reddy accepted that the way he thought startups had to work wasn’t just bad for his health: it was also bad for the company, because he was too stressed to make good management decisions. Instead, he says, founders need to be well rounded, take time to stop and think, and even work on side projects for money as long as you’re clear about how everything you do — including answering emails and taking meetings — contributes to your goal. A lot of this is self-awareness. Don’t be so caught up in the idea of being an entrepreneur that you’re still learning less than an intern after struggling to get your business off the ground for five years. Be realistic about how good the clothes-making robots you’re building actually are: if they can only make flat things like sheets rather than complicated garments like jeans, say so: you’re just as likely to impress people with your honesty as you are to lose orders you wouldn’t be able to fulfil anyway, and you won’t stress out your staff by having them work weekends on technology that isn’t advanced enough for what you want to do. Startup culture Reddy tackles some of the problems of startup culture, including inexperienced founders making unreasonable demands of employees, sexual harassment, and the problems of having all your company events revolve around alcohol. Culture, he points out, shouldn’t mean cults. It’s good to see these thorny issues tackled, and Reddy takes a very practical tone that will have readers nodding their heads in agreement rather than muttering about political correctness. Culture is about how everyone in the company treats one another, he says, suggesting that your sick leave policy is as important as whether people are passing around inappropriate photos of their sexual conquests at work. But implying that the causes are as simple as inexperienced leaders wanting to have things their own way, or to shake off the shackles of over-restrictive HR departments, misses many of the systemic issues that need to be tackled. Reddy is right to say that having a party culture is a failure by company leaders, but it’s too simplistic to suggest that you can simply change a ‘frat house’ culture to one of acceptance. Similarly, Reddy is clear on the importance of being a leader that people can trust enough to open up to, but rather thin on how to achieve that — although there are some horror stories from his past of what not to do. His description of millennials is sincere but phrases like ‘the participation-trophy generation’ sound almost like a parody, when it’s actually an attempt to celebrate having real conversations rather than making smalltalk, and allowing people bring their authentic selves to work. There’s some useful advice on hiring and managing people who expect to be communicated with as peers, and who need leaders to show how the company is working on things they care about personally. Again, it’s refreshing to hear the view that if an employee can’t cope with a task then maybe it’s the company’s fault for letting them get in over their head, and not being encouraged to ask for help. There are other useful nuggets scattered through this slim but discursive volume (which would benefit from better organisation): don’t pitch investors between October and January (they’re busy or away); don’t have your quarter end over Christmas; do your sums on the impact of the pay cut you’ll take by leaving a corporate job for a startup; look for people who say they’ll do whatever it takes, but also ask for guidance on things they haven’t done before (a combination he calls attitude and aptitude); and if you let employees work from home one day every week make it Wednesday rather than Friday in case it turns into a three-day weekend. Much of this is common sense and shouldn’t be worth documenting — but it clearly is. What You Know About Startups Is Wrong is an easy read that’s more useful than exciting, and it’s a welcome change to see some of the unrealistic gloss taken off the startup mirage. But when it comes to implementing Reddy’s advice, expect to need more help than this book provides.
World Asthma Day 2018: History, objective and theme for 2018
World Asthma Day 2018: Asthma, which is a chronic infection of the lungs and causes difficulty in breathing, has many symptoms that change in frequency and severity over time. These include breathlessness, coughing, wheezing and a feeling of tightness in the chest and are often triggered by allergens. How sick are your lungs? To answer this question, one might have to consider the air quality we breathe, the fast-paced lifestyle that is often accompanied by cigarette smoke and of course, other than the general environmental factors, genetics. With the number of deaths due to respiratory problems increasing every year, chronic conditions like asthma and COPD have come to warrant special attention and the health of lungs have become a primary concern. According to a study published in Lancet Respiratory Medicine Journal, out of the four lakhs deaths caused by asthma, about one lakh are in India. The study also noted that most cases of asthma can be treated or prevented with affordable interventions, but people often go undiagnosed or undertreated. To help alleviate this condition of ignorance and acquaint people with the latest and most effective treatments available, World Asthma Day is celebrated on the first Tuesday of every May. This year, it falls on May 1.HISTORY OF WORLD ASTHMA DAY Asthma, which is a chronic infection of the lungs and causes difficulty in breathing, has many symptoms that change in frequency and severity over time. These include breathlessness, coughing, wheezing and a feeling of tightness in the chest and are often triggered by allergens. To raise awareness, Global Initiative for Asthma (GINA) initiated World Asthma Day in 1998. Organised by healthcare workers in over 35 countries, it aims to educate people on how best to get control over this respiratory problem. Ever since, the day has had special themes every year and for 2018 it is ‘Allergy and Asthma’ – dedicated to the prevention, diagnosis and treatment of asthma.
MahaRERA will keep strict vigil on projects in progress
The issue of unauthorized constructions is an area that MahaRERA will focus on in the second year
The Maharashtra Real Estate Regulatory Authority (MahaRERA) will adopt a stringent monitoring system to ensure that 88% of the 16,300 projects registered with it are completed by 2022. MahaRERA secretary Vasant Prabhu shared this information with TOI on Monday, a day before the authority completes one-year of implementation. “After registering with MahaRERA, officials can monitor the completion of the projects online. The project is deemed completed after a developer submits Form 4 (completion form). So far, we have received 1,800 forms and the remaining should come through by 2022. In case of extension, MahaRERA allows extension for only one year,” he said. The issue of unauthorized constructions is an area that MahaRERA will focus on in the second year. “The authorities concerned have assured us that they would report unauthorized constructions to the respective collector. The developers not registering with the authority will face action as per the act,” officials said. On the way forward, Prabhu said the authority will focus on districts with project registrations in single digits, such as Gadchiroli, Beed and Hingoli. “We will conduct awareness programmes among developers in these areas,” he said.
MahaRERA has started a conciliation forum, a platform formed by the members of the Mumbai Grahak Panchayat and developer bodies, such as Credai. “It was seen that just one of the 10 states showed political will in executing the Act. However, we feel that the rest will soon follow suit. The resurrection of Indian real estate rests on long-term benefits of such reforms,” Shishir Baijal, chairman and managing director, Knight Frank India, said.
Govt to keep petrol, diesel out of GST net
The government has opted to ignore petroleum minister Dharmendra Pradhan’s repeated plea to bring petrol and diesel within the ambit of goods and services tax and decided to put the plan on the backburner, arguing that the time is not ripe for the change. The government has opted to ignore petroleum minister Dharmendra Pradhan’s repeated plea to bring petrol and diesel within the ambit of goods and services tax (GST) and decided to put the plan on the backburner, arguing that the time is not ripe for the change. While most of the states were always reluctant, sources told TOI that even the finance ministry is not keen on the move as it will not lower the burden on consumers but will only complicate the GST regime. Pradhan had pushed the move to counter the impact of higher retail prices. But with neither the Centre nor the states willing to lose any revenue from one of the most-taxed commodities, the government believes that the move will not result in any price reduction. On the contrary, both the Centre and the states will have to levy taxes over and above the 28% GST cap to keep the overall levy at current levels. This will result in multiple levies, which is akin to the current system where both levy VAT and other taxes. “This defeats the whole purpose. So, we have decided not to pursue the plan at the moment,” said a source, who did not wish to be identified. Sources said compensation cess above the 28% GST levy was also not an option, given that the Centre had a surplus of Rs 20,000 crore in the fund and with tax collections expected to go up, the kitty is only going to swell. The government levies a compensation cess on several luxury and sin goods such as mid-segment and large cars, tobacco and soft drinks that is to be used to make up for losses incurred by the states for five years. Inclusion of auto fuels would have helped companies get input tax credit on the taxes paid on petrol and diesel. But most states, including several ruled by BJP, had rejected the petroleum ministry’s demand as they wanted to retain flexibility. With global crude oil prices on the rise, the Centre and the states are under fresh pressure to lower taxes to protect the interests of consumers, given that pump prices of diesel are at a record high, while petrol is selling at the highest level since the Modi government came to power four years ago.
WhatsApp’s CEO Jan Koum to leave Facebook over privacy clash: Everything to know
WhatsApp CEO Jan Koum will be leaving Facebook. Koum’s departure is believed to be over clashes with Facebook over the issue of privacy.
WhatsApp CEO Jan Koum will be leaving Facebook, nearly ten years after he and co-founder Brian Action created the popular messaging app. WhatsApp was acquired by Facebook in 2014 for nearly $19 billion, which was the social media network’s most expensive acquisition ever. Koum’s departure comes at a time when Facebook is under the scanner over data privacy. It has been reported that the WhatsApp CEO quit over differences with the company regarding user privacy and weakening of encryption. Here’s a look at the reactions to Koum’s exit and what has been confirmed so far.The WhatsApp CEO and co-founder Jan Koum wrote a short note on his Facebook page announcing his departure from the company. He wrote, “It’s been almost a decade since Brian and I started WhatsApp, and it’s been an amazing journey with some of the best people. But it is time for me to move on.” Koum added he was blessed to have worked “with such an incredibly small team and see how a crazy amount of focus can produce an app used by so many people all over the world.” He added that the “team was stronger than ever and will continue to do amazing things.” Koum did not reveal in his post what his next venture will be, but said that he will do things outside of the technology world. This includes “collecting rare air-cooled Porsches, working on my cars and playing ultimate frisbee.” The post concludes by saying, “And I’ll still be cheering WhatsApp on – just from the outside. Thanks to everyone who has made this journey possible.” While Koum’s post does not talk about disagreements over privacy, a Washington Post report said that he is quitting over clashes with the parent company Facebook on various issues. These include WhatsApp’s overall strategy, Facebook using WhatsApp’s personal data and possible weakening of its encryption. The report cites people who are familiar with internal discussions and notes that Koum’s exit is unusual given he was the only founder of a company bought by Facebook, who was on the company’s board. WhatsApp executives were opposed to Facebook building a user profile with the app’s data which would be used across Facebook and its platforms for ad-targeting, recommending Facebook friends, etc, points out the Washington Post report. However, both Jan Koum and his co-founder Brian Acton eventually gave in to this idea.It also appears that the WhatsApp founders clashed with Facebook over the mobile payments system which has been rolled out in India. This is based on India’s Unified Payments Interface. Finally, there were clashes over encryption on WhatsApp with Facebook wanting to make it easier for businesses to use the app and its tools. The report notes, “WhatsApp executives believed that doing so would require some weakening of its encryption.” It also looks like Koum’s exit could be followed by others in November, adds the report.It should be noted that when the Facebook Cambridge Analytica data leak was first revealed, WhatsApp co-founder Brian Action, who had quit the company in February 2018, had tweeted, “It is time. #DeleteFacebook.” Acton is now part of Signal, another messaging app which has secure encryption. In fact, WhatsApp relies on Signal’s protocol for its end-to-end encryption. In a reply to Jan Koum’s post, Facebook CEO Mark Zuckerberg wrote, “I will miss working so closely with you. I’m grateful for everything you’ve done to help connect the world, and for everything you’ve taught me, including about encryption and its ability to take power from centralized systems and put it back in people’s hands. Those values will always be at the heart of WhatsApp.”Facebook COO Sheryl Sandberg commented on the post saying, “Jan, the work you’ve done building WhatsApp has connected so many people around the world. I’m grateful to have worked with you and I wish you all the best in your next chapter.” There’s no confirmation on who will be the next CEO of WhatsApp.
Mutual Funds increase exposure to IT stocks
After slumping to the lowest level in a decade last November, allocation to IT (information technology) stocks by mutual funds (MFs) is gaining momentum. Fund houses have increased their allocation to shares of IT companies by 2.1% on an overall basis in the last three months.
“The realignment process back from financials into IT has just begun, and if history is anything to go by, it will pick up pace further,” said Sunil Jain of Elara Capital. Post 2014, MF Nifty allocation to financials increased by 10%, from 28% to about 38%. The risk of multi-decade heavy over-ownership by MFs in financials was built at the cost of massive under-ownership in IT.
This was primarily on the back of three big events — the Modi victory in 2014, RBI Asset Quality Review during the end of 2015 and demonetisation (end-2016). Allocations moved out of IT, with MF holdings reducing by 11% — from 22% to 11%. Among index names, the largest allocation moved out of TCS, Reliance Industries and ITC into ICICI Bank, SBI and HDFC Bank. “However, since the start of 2018, we have started seeing signs of stronger outperformance and break-outs emerging in the most under-allocated names. We think despite the one leg of big move in IT, the uptrend will be a sustained one,” Jain said.
MF IT holding has been bottoming in the range of 6.5%-7% except during the global financial crisis in 2008 when it dropped sharply but recovered in a year’s time. MF IT allocation into non-Nifty stocks has dropped to the lowest range in two decades, data compiled by Elara Capital showed. “This is another sign of unfavoured and under-allocated sector among local funds portfolios. In the past, such lower readings have resulted in stronger upside move once the reversal began,” he said.
“This trend will gain strong pace once we see financials turning weak as there could be faster shift of capital into IT. Many financial measures have already started to turn weak,” Jain said. While IT stocks, Reliance and ITC are the largest underweight, their relative price performance has started to show stronger trends of breaking out from multi-year resistances, he said. The allocation to financials as a percentage of the assets under management of MFs has reached close to the highs seen in 2008 from where the reversal has begun.