Ten interesting things we read this week

c) Define financial goals and invest to achieve: Our mothers have not thought in terms of return on investments, but they knew why we must save. In simple words: financial goals. Karnad emphasizes on the efforts and financial planning that goes into buying a house. “If your plan is to buy a house through a home loan, then you have to manage accordingly in terms of how much initial amount you need to put in and balance by a home loan,” says Karnad. Also, these women leaders in turn have taught a few financial lessons to their mothers as well. And these include diversifying investments and investing in digital gold schemes.

2)     What’s next for the most important company in Kazakhstan [Source: aika.substack.com]

Kaspi.kz, a bank turned technology company that IPO’d in London recently, raised over $1 billion and become the largest listing out of Central Asia. It models itself after other super apps like WeChat, Ant/AliPay, Gojek. Gojek’s definition of a Super App: A Super App is many apps within an umbrella app. It’s an Operating System that unbundles the tyranny of apps. It’s a portal to the internet for a mobile-first generation. Kaspi’s Super App platform has three key sub-apps or segments: payments, marketplace (e-commerce) and lending (which they call fintech). Today, however, Kaspi is overwhelmingly a bank as 80% of its revenues and 70% of its profits are from lending to customers. It originates 100% of loans from its own balance sheet (vs 2% for Ant/Alipay).

Kaspi proved that there is tremendous value in a small and disperse market as Kazakhstan - often a limitation to investors. In fact, Kaspi’s annual revenue per user in 2019 was above $220 - which is higher than that of Google and Facebook. Investing heavily in Kaspi-native payments was a killer move to build the strongest competitive advantage: customer network effects and access to wallet. These developments included P2P payments, QR code enabled payments with merchants, etc. The internal closed loop payment system maintained by Kaspi is now so dominant in Kazakhstan, it accounts for 66% of all payment transactions. The biggest question is can Kaspi scale and grow outside of its Kazakhstan success story.

Kaspi’s focus on customer satisfaction to the exclusion of almost anything else, is the right long term game. This has earned them a lot of loyal and profitable consumers. However, Kaspi can capture more value outside of its current ecosystem, if it opens its platform up to other suppliers, effectively becoming an aggregator. Kaspi already has two out of three key characteristics as defined by Ben Thompson, author of the Aggregation Theory: 1) Direct relationships with users, and 2) No marginal costs of serving new customers. Without going into a lot of esoteric partnership, some obvious financial services on Kaspi’s platform could include: 1) Savings and investments (particularly popular stock trading); 2) Remittances and international transfers; 3) Insurance; 4) Lending for other needs like cars, and mortgages; and 5) Crypto exchanges.  

3)     The puzzling psychology of procrastination and how to stop it [Source: Science Focus]

An estimated 20% of adults (and above 50% of students) regularly procrastinate. It would be easy to say that procrastination is the result of poor time management or, worse, sheer laziness. But the science simply doesn’t back this up. “There hasn’t been any convincing scientific evidence to say procrastination is the result of poor time management. But we can easily say it’s all to do with mood management,” says Dr. Fuschia Sirois of the University of Sheffield. “At its core, procrastination is about not being able to manage your moods and emotions. Although many think impulsivity and self-control are the problems – and they do play a factor – underneath is a poor emotional response.”

Procrastination can cause a lot more problems than missed deadlines. Over decades Sirois has examined the impact of chronic procrastinating on a person’s health, her findings worrying at best – and downright terrifying at worst. “People who chronically procrastinate – people who make it a habit – have higher levels of stress and a greater number of acute health problems. They are more likely to have headaches or insomnia or digestive issues. And they’re more susceptible to the flu and colds.” Even more alarming, Sirois has found that procrastination is a factor that can lead to hypertension and cardiovascular disease, with chronic procrastinators more likely to put off healthy behaviour such as exercise.

For Sirois, there are two primary ways of reducing procrastination at its root cause: self-compassion and cognitive re-framing. “I think people don’t realise that procrastinators, especially chronic procrastinators, are extremely hard on themselves – before and after the task. And rather than getting on with the job, they just go round and round spinning their wheels,” she says. “My advice is to not go full in over-identifying and becoming that frustration. Step back from it for a minute and just acknowledge that you’re not happy with yourself. And then move forward. It’s basically about recognising that everybody screws up. You’re not the first person to procrastinate, nor will you be the last. Welcome to the human race.”

4)     Consumers are adopting digital by the dozen, but the future will still depend on physical channels [Source: Economic Times] 

As we sit in the middle of a second wave, reading about the high likelihood of a third, a sane choice would be to watch the match on TV, in the safety of home. Despite the numerous epitaphs being written, the physical channel is likely to remain at the centre of consumption, alive and kicking. The digital channels will exist too, but they are likely to enable the effectiveness of the physical channels. As a species, human beings value the physical-social relationship, as it brings a sense of familiarity, a degree of safety and trust, with the physical proximity of touch and feel. This is the primary reason why traditional forms of trade are so big in India and other similar countries.

For FMCG and other consumer-oriented categories, digital channels are channels of the future, but they will be of secondary importance. Despite the hype, e-commerce is not likely to cross 8%-10% of total FMCG sales over the next decade. In developed countries such as the United States and South Korea, e-commerce hasn’t crossed the 20% mark. In China, e-commerce is hovering in the mid and high range of 20%, but is expected to settle at 20% in the long term. Even for experience-oriented purchases, especially in the luxury retail space, the physical channel will remain the primary channel of importance although it will be improved by the digital interface.

Even in the case of entertainment-oriented experiences like travel, music, and dining, while digital experiences can be an interim solution, the physical channel will reign supreme. In conclusion, while people have written off physical channels with the supreme prophecy that digital channels are likely to rule the roost in the future, the prediction is unlikely to materialise. At the same time, leading retail and consumer-focused companies need to be appropriately prepared.

5)     Makers Keepers: What can we learn from listed vaccine makers [Source: buggyhuman.substack.com] 

The author of this article went through the world’s leading vaccine makers (who are publicly listed) 1Q2021 filings to see what we could learn. While most of the above vaccines are made in US or Europe (67:33 split), ~90% of doses were delivered to North America and Europe. US, by law, exported zero vaccines in 1Q. Europe reluctantly did better, but even EU & UK are squabbling over blocking vaccines to each other. ~5% of doses were delivered to COVAX initiative, aimed at getting vaccines to poorer countries. The big-3 expect to more than double doses in 2Q vs 1Q, but North America and Europe demand likely to double too.

2H2021 is looking better though, for vaccine supply to rest of the world. Production estimates for 2021: 1) Pfizer-Biontech: 2.5-3 billion doses (1.6 billion contracted); 2) Moderna: 0.8-1 billion doses; 3) AstraZeneca: no guidance. This implies 400+ million doses/month over H2 of 2021 from two manufacturers. If N America + Europe vaccination stays at April pace of 200+M/month, availability for export to rest of world could increase disproportionately in H2. Western vaccine triopoly retained ~90% of vaccines for home use. Outside of a few tiny countries, each slightly larger than Andheri, Big-3 made no difference to any country’s vaccination program. In no scenario could they have made a difference to India’s. Our only option in 1H2021 (and beyond) is to have our own Aatmanirbhar, global-scale, credible vaccine manufacturers.

Talking about Serum Institute, it is World’s #2 Covid-vaccine producer. Serum makes as many vaccines out of Pune as Pfizer does out of its US site in Kalamazoo. Serum has achieved >2x scale of its parent AstraZeneca, while selling vaccines at half the price. Also, Bharat Biotech is equally commendable. Their May production run-rate (30M/month) nearly matches AstraZeneca’s and is 3-months behind Moderna’s ramp-up. At 70M doses/month, they’ll match Moderna in a few months. To have two Indian companies amidst global top-5 in a highly-specialized niche is a phenomenal achievement (and blessing).

6)     The hunt for Indian Narcos: Netflix and the neverending search for Originals that sizzle [Source: Economic Times] 

In 2018, Netflix CEO Reed Hastings had added to the hype around Netflix’s India play by saying that its next 100 million subscribers will be from the country. Three years later, Netflix India is at a measly 4.6 million, according to advisory and consulting service provider firm Media Partners Asia. The question is simple: why this yawning gap between aspiration and reality? Is the 100 million number now being seen as merely a rhetoric designed to excite the local media and Netflix’s global shareholders? In India’s crowded streaming market with over 40 platforms, Netflix is fourth in the race for paying subscribers, behind Disney+Hotstar, Amazon Prime Video, and SonyLiv.

With premium positioning and an expensive subscription, it is natural that the expectation from Netflix’s content will be high. To live up to that expectation, Netflix inked deals with top production houses in India namely, Red Chillies Entertainment, Reliance Entertainment, Phantom Films, and Dharma Productions’ digital entertainment arm Dharmatic Entertainment. Over the last five years, and specially in the last three, Netflix has generated several original shows and movies with the help of these big production houses. There have been hits — Delhi Crime, Jamtara, and two seasons of Sacred Games. But considering the number of Originals (both commissioned and bought) it is churning out, the ratio of standouts has been low. This may be the single-biggest reason why many are feeling underwhelmed by Netflix in India.

There are many who argue that Netflix’s success can only be measured in terms of its global business. In the quarter ended March, it generated profits of USD1.71 billion, which, a senior executive of a global movie studio in India, says, “Is ultimately the signal that Netflix’s seemingly random content strategy is working. Could it do better in India? Yes. But it has the luxury of cash in hand to take its time”.

7)     Want to raise successful kids? Science says these 7 habits lead to incredible outcomes [Source: inc.com]

Raising kids is a daunting task. This article highlights the seven most interesting habits that successful parents often practice. a) Teach kids to take pride in their effort, not their gifts: Not this - "Sally, you're so good at math!" Or else, "Ethan, you're such a fast runner!" Instead say, "I'm proud of how hard you studied!" Or: "I could see the determination on your face as you crossed the finish line!" b) Get them to play outside: Studies show that younger kids whose schools don't include outdoor recess during the day had a harder time developing good reading skills. And, more recently, researchers from North Carolina State University said they found a striking correlation in kids aged 10 to 18, regarding how much time they spent outdoors and their emotional well-being.

c) Make sure they learn about good role models: Kids will rarely be what they cannot see. Researchers at New York University, Princeton University, and the University of Illinois studied the degree to which boys and girls believed that grown men and women were likely to be "really, really smart". At age 5, both boys and girls believed that grown men and grown women were equally likely to be "really, really smart." But by ages 7 and 8, girls had overwhelmingly grown to believe that men were more likely than women to be "really, really smart." d) Let them see when you fail: Researchers at the Massachusetts Institute of Technology experimented with children as young as 15 months old, and found that the less their parents allowed them to see how much they struggled and failed at times, the less resilient their kids were.

e) Do this with their toys: Researchers at the University of Toledo studied how young kids played with toys. To cut to the chase, they found that kids who were given a smaller number of toys to play with found ways to expand their imaginations and use them more creatively than kids who were given larger numbers of toys. f) Limit their screen time to this many hours: Researchers from San Diego State University and the University of Georgia combined a series of previous data sets to find the sweet spot of realistic digital use: between 1 and 2 hours a day. g) Stay close, but not too close: Let your kids try things and fail, making sure you don't get so invested that you wind up fighting all their battles for them, and the like.

8)     5 unproductive thought patterns with the power to hijack your brain [Source: wellandgood.com] 

It’s near impossible to banish unproductive thought patterns from your mind for good. In her new book, Trust Yourself, human behavior professor and executive coach, Melody Wilding pinpoints 10 types of negative self-talk and ways people overthink—and how to stop them in their tracks. Highlighted here are five of the most common unproductive thought patterns. a) All-or-nothing thinking: Wilding says all-or-nothing thinking is an unproductive thought pattern many of her clients struggling with. “This is when you see a situation in absolutes without room for a middle ground,” she says. One example of this she says is, “if I don’t get this right, I’m a complete failure.”

b) Overgeneralizing: It is similar to all-or-nothing thinking in the sense that it’s a negative thought pattern that takes a situation to the extreme. Wilding explains that the difference is that all-or-nothing pertains to one specific situation while overgeneralizing turns it into a pattern. “It’s the idea of thinking of, ‘I completely screwed up that last presentation, so I’m definitely going to mess up the next one,” she says. c) Disqualifying the positive: Wilding says disqualifying the positive is another unproductive thought pattern especially common among people who struggle with self-confidence. “One example of this is having trouble accepting compliments,” she says. “For example, if you worked really hard on something and someone acknowledges that, saying you did a great job, but you brush it aside and say it was a team effort instead of simply saying thank you.” Another example she gives is doing something well but telling yourself anyone could have done it.

d) Emotional reasoning: “Simply put, emotional reasoning is when you feel something and then think it must be true,” Wilding says, explaining another unproductive thought pattern. “For example, ‘I feel inadequate, so therefore I must be inadequate.’ Another example of this is thinking, ‘I feel guilty because I set a boundary with someone, so therefore I shouldn’t have set that boundary,'” Wilding says. Newsflash: Emotions aren’t always accurate representations of who you are or what’s happening. e) Should statements: Should statements center around the expectations we place on ourselves, Wilding explains. Ever struggle with something and think “I should be better at this by now!” That’s a should statement rearing its ugly head. “It’s related to competence because competence is about believing you can do something; self-efficacy.” Managing should statements is all about giving yourself grace.

9)     Star India, Trexit, and the curious case of National Broadcasting Policy [Source: Economic Times]

India’s largest broadcasting company, Star & Disney India, reportedly tried to influence the Ministry of Information And Broadcasting (MIB) to suit its strategies. An investigation by The Economic Times reveals that the broadcaster went to great lengths to influence the government of India’s upcoming National Broadcasting Policy (NBP) — and almost succeeded. Star India’s goal was to oust the Telecom Regulatory Authority of India (TRAI) from the TV-broadcast sector. Towards this end, it filed cases in courts and indulged in intense lobbying within the government.

It all started with TRAI notifying the new tariff order (NTO) in 2017. The order sparked a long-drawn legal battle, with Star challenging the regulator’s jurisdiction in the Madras High Court and later in the Supreme Court. Following unfavorable decisions, Star decided to take a methodical and circuitous approach to undermine and ultimately push the regulator out of the sector. Internally, the project was named Trexit (TRAI’s exit) — on the lines of Brexit. In a three-month-long investigation, The Economic Times has received inputs from some Star employees and consultants regarding Trexit. Various independent sources with first-hand knowledge of regulatory and public-policy affairs have affirmed that “it was a three-prong strategy”. The first part was legal recourse; the second was to get ‘broadcast’ acknowledged as ‘works’ under the Copyright Act, 1957, by suggesting an amendment to the Act; and the third was to influence the upcoming NBP and the amended Cable TV Act in Star’s favour,” one of the Economic Times’ sources said.

The first litigation was filed in the Madras High Court in 2017, challenging TRAI’s jurisdiction and administering the TV-broadcast sector on grounds of it violating the Copyright Act (got rejected). Separately, the broadcaster was also lobbying at the same time to amend the Copyright Act to bring TV broadcasting within its ambit in totality. the broadcaster also sought a provision or section to state that the Copyright Act shall have an overriding effect over all laws in force for the time being in India, including the TRAI Act. This would have effectively ended TRAI’s powers over the sector. Meanwhile, Star & Disney India’s attempts to use the courts to fulfil Project Trexit have continued. In the NTO matter, it has pushed the Bombay High Court to read down TRAI’s regulatory powers on the grounds of freedom of expression. The court has reserved the judgment in the matter.

10)     Amit Sheth on Breaking Barriers [Source: Youtube; Yi Coimbatore] 

We always tell ourselves that we are too busy to fit in at least 30 minutes of exercise to stay fit and healthy. And here’s Amit Sheth, who dons many hats. He is an entrepreneur, bestselling author, athlete, and a motivational speaker. In this inspirational talk, he talks about his running journey and the challenges that he faced in between. He started running at the age of 38 and since has run dozens of Marathons and Ultra Marathons around the world. Also, he was the first Indian to Run the Two Oceans Ultra-Marathon (56 km) South Africa (2008).

He has become so passionate about running that he ran marathons in across various countries all over the world. But here he talks about his Comrades Ultra Marathon experiences and the life lessons that he learnt. He was the first Indian to Run the 89km Comrades Ultra Marathon - The Ultimate Human race in South Africa (2009). It was in the second attempt that he could finish the race before the cut-off time. But, running ultras didn’t come easy. When he started running, he had severe back pain and on his first run, he couldn’t even run for a minute. But his determination to achieve something made him get onto his feet again and again and run one km after another.

Despite his everyday job as the CEO of a successful engineering company in India, Amit makes the time to blog about his running experiences and share his running hints, tips and general motivation to runners all over the Indian subcontinent and across the world. He is a motivational speaker of note and also an amazingly great-heart when it comes to charitable fundraising. To date, Amit has collected over twenty million rupees for the cancer treatment of underprivileged children at the Tata Memorial Hospital – the largest cancer hospital in Asia. With his quiet, unassuming nature and huge heart, Amit most certainly epitomizes the true spirit of the Comrades Marathon like few others can.