Viswanathan K's Thoughts

I was surprised to learn that India’s largest brokerage firm is not ICICI Direct, but a startup named Zerodha. It’s the largest in number of clients and trading turnover on the stock exchanges. Its founder, Nithin Kamath, started trading in the stock markets in the late 90’s, a time when everything was still offline, writes Ashish B in his book on the company.   Despite the inconvenience of the offline world, Kamath was hooked. He worked at a call center in the night; and traded during the day. One time, he bumped into a US returned guy at the gym, who asked Kamath to invest ₹25 lakhs on his behalf! Kamath quit the call center and started Kamath Associates. Soon, he had more clients, and found “logging into ten different accounts was difficult” and painful. His solution? Become a sub-broker of an existing broker (Reliance Money) of the stock exchange – it would allow him to handle multiple accounts simultaneously. He did just that in 2006.   The brokerage fees soon be...

Guess which is India’s most valuable unicorn today? It’s the educational app, Byju’s. As Ashish B writes in his biography of the company, COVID-19 helped the company’s growth as online education became common.   The company’s founder, the eponymous Malayalee named Byju Raveendran did his schooling at a government school in Kerala – both his parents were teachers (in Maths and Physics). Rote learning did not appeal to him at all; he preferred to visualize concepts, a technique that would become part of Byju’s teaching system.   He did engineering, not medicine, because only engineering would give the “time to play sports”. Having completed his Mechanical engineering, he started working as a service engineer for a shipping company and got to see the world.   His friends, who were preparing for the IIM (CAT) exams, sought his help with the Maths side of things - He had an aptitude for teaching. In Bangalore, he was soon taking classes for around 40 students. It ...

  My daughter’s 5 th standard Maths book has a chapter on the metric system: “The metric system of measurement which is used all over the world is based on the multiples of 10.” To recap what you learnt at school, Kilo is 1,000; Hecto is 100; Deca is 10; Deci is 1/10 th ; Centi is 1/100 th ; and Milli is 1/1,000 th .   The (in)famous exception to the “used all over the world” part of that description is, of course, America.   Remember the term “unicorn” that refers to privately owned startups that are valued at a billion dollars or more? Well, there are enough of them whose value is more than $10 billion. And a few even crossed $100 billion. So new terms were needed for those. By a remarkable coincidence, the “uni” part of “unicorn” means “one”, so the new terms were almost self-evident: ·        Deca corn = a unicorn valued at over $10 billion (but less than $100 billion); ·        Hecto corn ...

A short while back, Reliance invested $240 million in the Bangalore based delivery startup, Dunzo. With this, Dunzo’s valuation became $775 million. But what does the term “valuation” mean? It’s the cost of buying the entire company . For companies that are listed (i.e., bought and sold on the stock market), the answer is intuitive: Valuation = Total number of shares x (multiplied by) Share price   But Dunzo is not a listed company (i.e., it can’t be bought/sold in the stock market). How does one value such a company? In such cases, one has to wait for a round of investing to happen. At that point, when someone pays Y amount for a Z% share of the company, you do the maths (if Z% is equal to Y, how much is 100% equal to?) to get the answer. That’s what we saw with Dunzo above.   Since we touched upon billion-dollar valuations for private, startup companies, it brings us to the topic of “unicorns”: “A unicorn company, or unicorn startup, is a private company with a ...

In November, 2013, Aileen Lee  coined the term “Unicorn” to describe a certain type of company: “U.S.-based software companies started since 2003 and valued at over $1 billion by public or private market investors.” By that definition, Lee called Facebook the super-Unicorn! Today, just a year and a half after the term was coined, Fortune says we live in the “Age of the Unicorns” ! And the top companies on that list aren’t even all American anymore: Xiaomi, the Chinese smartphone manufacturer, tops the list and India’s Flipkart is number 7 with a valuation of $11 billion. At number 2 on the list is Uber ($41 billion), the ride sharing company that was in the news when one of its drivers raped a passenger in Delhi. What does “ride sharing” even mean? Here’s what it means: 1)       When someone wants to go somewhere, they ask for a ride via the Uber app on their phone; 2)      Uber finds a driver (someone who installed t...

I’ve heard complaints from the non-IT folks in Bangalore about the problems that we IT folks bring to the city: higher rents and too many cars leading to congestion, to name just a few. Kitty Morgan’s article is about how the non-IT folks of Silicon Valley feel. Some of the feelings are similar: “Annoyance, resentment, paranoia, even something like hate.” But she acknowledges that there are other feelings too (but those would only apply to Silicon Valley, not Bangalore). When she sees the IT folks getting into their office buses (Yeah, you heard that right: bus services in America!), she wonders: “What if it’s envy? The ballad of the left behind…There is nothing like a shining white chariot sailing through the streets to remind us on the sidewalk that we are not the anointed.” Silicon Valley is “an industry built on accelerating obsolescence”, as Fred Turner puts it. Tablets are doing that to the PC, and smartphones did that to…well, that list is just too long, isn’t it?...