Pakistan Inc. “Retiree Entrepreneurs, Saith-a-preneurs, Startups & Failure Dollars.”

What an amazing & resilient country. Even after decades of less than adequate governance, economic progress, security challenges and internal issues; if you ask the average Pakistani how they are doing, their initial response is “sab theek ho jaye ga inshallah/all will be well by grace of god” There is no other way to explain this response but a deep bond between man his creator and the belief that better days are coming. Or the absolute lack of education and access to understanding economic fall out.

In some ways it is this, that keeps us going because our rulers, law makers & security apparatus have not given us any thing to write home about. To understand how Pakistan Inc operates we must understand and evaluate how the top 1% of businesses function in this country & perhaps most developing countries.

Before we go down that path we must understand that the 1% are divided after 70 yrs of independence in two very distinct categories. Those who were Born-rich and those who Built-Rich but most of those who built wealth also had the Born-rich on their side. There is a slight nuance but not a lot because in the end the rich are the rich.

The narrative of wealth and achievement ignores the other side of the coin namely, that the opportunity to build wealth is not equally or broadly shared in society especially in ours. Those who are born-rich typically continue to fund those who will eventually be the Built-rich. The real heroes (far and few in between are) those who Built-rich without stealing, nepotism, politics, power, or being born-rich. But it is a vicious cycle. The children of Built-rich are Born-rich. That creates an all other kind of 2nd generation dystopia.

Part of that dystopia is that The born-rich have trouble relating with the built-rich. Ironically, it’s the built rich parent’s fault their kids are born rich. That has a deep rooted impact on how business , our economy and our political structures work.

Keeping this premise in mind the Built-Rich know how money works and can scale wealth compared to Born-rich. We are at a tipping point in our society that the 2nd/3rd generation that has inherited or underway to inheritance is not looking good from the eyes of the first generation. To manage for that, the system has been further broken down.

Let me share the make up of a “Rich-Family office” in Pakistan. I have seen, interacted and engaged with many. When the patriarch feels that the wealth created by them(who are in the category between born-rich and built-rich) is about to go die behind the family barn once they go to meet their maker, they do some thing incredible.

Like any parent they feel preservation of money = preservation of their offspring. So they go in a multi pronged multi faceted approach of recruiting what I fondly call the best “Retirees of the Country”

We are perhaps in very unique position in this country where post 60 yrs of age people begin some of the best corporate careers any one can dream of having. The price of admission is to have been retired a federal secretary, Judge, some one from the forces, police, ministers and the religious right. If you were average all your life but a product of the system fuelled by taxpayer subsidy your value goes up by 10x post retirement.

This is what startup dreams are made of. The real entrepreneurs and startups in this country are this retired lot. Can’t fault them for capitalising on this as they are the definition of capitalists, the folks hiring them are the real venture capitalists of our society.

What is happening here is the creation of a system that will continue to f*** us for generations to come. Because old money found old stall-warts and created a system that went from separating wealth from creating value vs extracting it (e.g. founding vs rent-seeking).

Any family office over 20m$ of wealth to preserve, has built its ‘Retiree Militia‘. The average day job entails coming to an executive suite perched in the head office of the company around 11 am with the company provided Mercedes + 1M PKR monthly retainer, with the job description to “assist” the kids “assist the ceos of the various businesses” ensuring they don’t fall out of favour with the ruling elite or the law. Using their profiles in the boards of their listed companies, some times with the status of Chairman. A good party trick no less on having cracked the system and giving further and extended momentum to cronyism. There is a reason why the systems or systemic changes in this country the average person desires, will never happen because the rich have built an insulation layer to make sure the rent-seeking behaviour continues past their life time.

Behind this shiny veneer of continuity is a sad admission. People who don’t trust their kids directly with an inheritance or to be self sufficient in running the businesses they created, or to go out in to their own and figure out their own shit, admit they failed to raise good stewards. So besides this retired militia the second best thing to handing over all of the families crown jewels and on Mother Dears insistence that “malik sbs kids are so involved with business” , “chowdhry sb decides to setup an investment fund for their offspring” you can replace malik/chowdhry, with a saith of any ilk, the execution remains the same.

This brings us to act 2. Newly minted Saith-a-preneurs (SAPs) with a fancier office than dads, backed by the Militia and knowing they can do no wrong, fuelled by daddy dollars launch in to Pakistan Inc to make their mark. One only has to be reasonably smart to not f**k this up.

The complexity with this structure is that SAPs/new money spends on trends old money spends on tradition. Creating a conflict because for all their fancy offices, daddy dear and his militia just don’t get startups and tech companies. They only get licenses, quotas, dividends, rent-seeking, tax-evasion and representative monopolies. Even the SAPs that have a good head on their shoulders dont get too far because of this overbearance. The real decisions go to daddy dear, this is a golden cage for the SAPs, with their moms and wives happy that chotu sarkar now has a day job and a line up at the mutual admiration club dinners + events, they have finally come of age. The reality couldn’t be farther from the truth.

We likely wont be able to create the Ambanis or Tatas of our world by doing these things. Only a select few families and rich large local conglomerates have their children fully entrenched, but most dont. Those who dont are actually also killing the real chance any startups have at success by making these “band camp boys” in-charge of VC $s that they didn’t earn to invest in startups and founders who have zero in common with them, but like their forefathers who were at the mercy of the saith’s shitty job for 20 yrs. now they are at the mercy of the same blood money to be invested in to their companies. The trigger of investment go-no-go remains with daddy dear and the retiree militia. Delaying the aspirational target of the founders and most cases, mis leading, mis representing because they dont have the ability to make real commitments without permission. This is creating a slew of hungry startups whose time, effort and energy is being wasted chasing the “house of X” for money or the “X Group”.

This is the circle of life we are faced with in Pakistan Inc. The good news is the inflow of foreign capital, but that capital also gravitates to the band camp boys because they take the incoming money to visit daddy’s industrial estates/parks/fertiliser/chemical/food processing/packaging businesses or bank and the incoming money also feel safe in the company of old money.

So if you are a no-body with some money in the tank, this is how you help break this circle of life by funding entrepreneurs in this country at a low low entry price sans daddy dollars. The concept is simple, you need to enable others to build either your idea, a shared idea or their idea, but with the catch that they deploy the MVP or business in under 60 days. It could be as simple as funding some ones inventory or as complex as a Monetization idea for m-commerce.

This concept is called “failure dollars” You need to be able to part with 5k USD for some one else to invest their time to do a pilot of a business idea/concept/company/product/tool . The thesis behind this 5k is, you can afford to loose it but what if you both win? If the idea is successful the person you funded gets to keep 80% of the idea/equity/reward, but if it fails you pick up 100% of the losses. Why would you do this? Because it’s late for you to retire as a federal secretary or be a judge or be a retired general. Also instead of bit**in and moaning this is a concrete way to steer outcomes for people who otherwise will never have an opportunity to take a bet on them selves because they always need a “job” to run their affairs, create the leverage in some ones life by doing this.

It builds trust. With guys/gals who have ability and the capacity to make time & build but no access to capital. It covers their prototype time and the assurance that the failure funding is yours, makes them work 10x harder. Victory is shared and they own it, you get a continuous residual piece and if you can scale this model, you become a cottage industry equivalent of an aarti without being predatory. We don’t need VCs and Angels we need folks with dry powder who can fund small experiments at scale and bring others to do the same. The only way out of the mess and nepotism we have created, is to create a few 1000 M$ revenue business that generate value vs extract value. It has to start some where and it can start from you. It’s time the Pakistani people and government realised that it’s the country’s ambitious young people who are building the future, not its retirees.

Rich men are more harmful than rich food. But then, who cares for the health, be it ours or the nation’s.

Dreaming in Technicolor

Technicolor: You can use technicolor to describe real or imagined scenes when you want to emphasize that they are very colorful, especially in an exaggerated way

To dream in technicolor one must have some thing worth dreaming about? Right? Given the not so rosy picture(s) down below, what must one do or can do, to be in a position to have big aspirations and even bigger dreams?

Assumed Salaries/Charge-outs By Profession in Pakistan in PKR

Hourly Salary Breakdown in PK – Based on market assumptions

This is a pretty telling sign of where things stand and where we are headed. Not all surgeons and doctors are made the same neither are all software developers, then why try to generalize their salaries in to an average. To give you a snap shot of what you need to do to break the chain of being stuck where you are and explore the options you think you don’t have.

Some thing we value dearly, we protect with 80 US c/h Security. Meaning our lives and our possessions and our loved ones. Yet to protect our selves from the law we are willing to enlist tier one lawyers who may cost around 26$/h. I know not the perfect co-relation on salaries but you get the disparity. Similarly, to increase health outcomes and chances of survival based on the access in say KLI, a person has to a surgeon, translates for the surgeon at $34/h. Again just accept the math as being a good starting position. Next look at what an a sub editor for digital publication makes for example vs a public servant who is starting off at BPS 17. 1$ vs 90 US Cents/h. The irony being that I sourced the numbers from an online publication.

Next we move to our fav category of Software Developers who if they free lance can increase their outcomes to 9$/h leading up to 25$/h whilst their local counterparts if they are lucky to find work will end up between 1$/h to 3$/h.

Given where the population dynamics stand, is it any surprise that our developers no longer want to work for local companies or peg their earnings to PKR? It’s not.

Now comes the exciting bit, given where the cost of labour stands from professional to semi skilled to not, if you don’t find your self between the 8-12$/h comp band and rising the better choice is entrepreneurship. Provided you were smart and have some savings or have a support structure around you that is within that band and can absorb the cost of your being unemployed till you launch. Thus a side hustle till it breaks even is the best way forward. If you were in this band or higher and still want to do it, it only increases your runway and you should go for it.

Next, use the above to judge, where you are likely headed and what that translates in to $ terms for your personal situation. If you are early career and have gotten near double digit growth but still not making the 8-12$/h benchmark then the story 10 yrs out is not any sexier. Rather than slaving away and being miserable its best to have tried and failed vs wishing you did.

An average Master’s degree program or any post-graduate program in Pakistan costs anywhere from 409,000 Pakistan Rupee(s) to 1,230,000 Pakistan Rupee(s) and lasts approximately two years. That is quite an investment in time and money.

You can’t really expect any salary increases during the study period, assuming you already have a job. This increasingly looks like a zero sum game given the lack of jobs and lack of quality education that nurtures graduates to step in to higher potential roles.

We continue to churn out sub-par candidates further the industry is not growing at any considerable pace any way. So where do these grads find work? Likely scenario is unemployment and the other one is being under employed, that is both ineffective for the employer and mental trauma for the employee. Net net, every one looses. So take this money and start some thing instead. Or learn a skill online that you can convert to $ based earn outs even if it is incremental gains. Also incremental gains from profitable businesses or skill based earn outs are outsized in comparison and value to raising cash for $ negative revenue startups with no bottom line.

Your options are to invest in your self. Easier said than done. We have no real executive business coaches or startup coaches that you can go to enhance your outcomes just like one goes to a cardiac surgeon for heart trouble. We need to enhance the outcomes for people who are trying.

Those outcomes wont be helped by members of any MxO(Mutual Admiration Club Officers) or self prescribed public speaking gurus or positive thinkers and or motivational speakers.

This sh*t needs real experiences from the trenches, but unlike surgeons who can flash degrees and credentials the credentials to help some one else’s life/business outcomes cant be encapsulated in a degree alone. Yet the need is real. Even for established businesses to grow to a point where they can dream in technicolor and support growth narratives and better $ hedged comp, every one needs mentoring.

Sadly mentoring like therapy is accepted only by those who are self aware and coachable. The minute you shut off positive criticism or directionality from someone who is at a different station than you in life, you chose to make your professional growth stunted. Choose growth and runway vs limiting your options. Be open. Be critical, be self aware.

Incubators try to do a decent job, local accelerators that charge you to teach you how to pose for a selfie or worse charge you to listen to their American accent typically dispense no real world strategies to enhance any ones outcomes let alone business growth. Choose wisely. Just like you wouldn’t hire a doctor with a fake degree don’t get entrapped by these fast talking types with zero credible personal growth stories or investment $/s that have returned some home-runs if not all. Always speak to their former cohorts, you will sense that your BS detection meter going haywire. The 5 to 10k USD these accelerators want from you, or aid agencies that will give them the money to train u, should you have the cash find a mentor and spend it on one to one time for 100x better outcomes.

Judge, be critical, advice is cheap on the internet. You can ask Google what ever you want. Don’t fall for the posers, you are about to bet your life on making choices that have the ability to impact your your life for good. Choose positive influencers, folks with real world execution and scale grit. Not people who romanticize their personal stories only for standing ovations.

I tell people, you can please a different crowd every night by the same old story but its near impossible to please the same crowd with it every night. Make sure you are authentic enough from the first night to the last night across similar and dis similar audience and with repeat customers. Your DNA never changes but your outlook should. Those who adopt fastest, win over time but maintain their streak the longest.

It’s time you plan ahead to break free of the shackles of being locked in a zero sum employment game in the local context. Hustle on the site if need be, build what you need to till you can break free, but till you tell your self that dreaming in technicolor is possible you will continue to dream in black and white and that my friend(s) is not just good enough for this dog eat dog world.

“Dare to believe in the reality of your assumption
and watch the world play its part
relative to to its fulfillment.”

― Neville Goddard

RISK. Our Unfair Advantage & how to keep on taking risks.

Risk is not driven off a gene, yet it seems to be coded in to our personalities and our national DNA. But it seems there is right and wrong risk, which I will get to shortly. What I want you to consider is the following: Scientists who study the human
mind—say that most risk takers become bored easily. But not all risk is the same, neither are all risk takers the same. Nor are the circumstances that propel to make the choice to take a risk. Plus there are varying degrees of risk it self.

Looking at the above pictures, it seems like most if not all these activities happen around us daily. Are we predisposed to taking risks all the time? that any where else would be the same as Extreme Sports; (driving into oncoming traffic, carrying a Deep Freezer on a bike that could with a slight change in the center of gravity lead to catastrophic results. Or having or riding with your pet Lion or Bear+Goat combo in a Car.

Now think about the global Politicians/celebrities who routinely get caught soliciting a sex worker? Is the risk worth taking when the whole world is watching you? Is it because they are bored? Is it different than the Cutting cables on an electric pole without protection(no pun intended).

At the macro level every one is both a risk taker and a risk avoider, just that our domains and reasons vary. We all struggle with decisions of risk universally, the actions or process of evaluating which risks to take and which to avoid is highly personal. It starts with, is this Risk right for me.

There a tool you can use that scientists use to see what happened to your mojo. Its the Balloon Analog Risk Task (BART), which is not a video game but a research tool used by neuroscientists and cognitive psychologists to assess a person’s proclivity for risk.


In case you were really interested, this is how it works. The Balloon Analogue Risk Task (BART) is a computerized measure of risk taking behavior. The BART models real-world risk behavior through the conceptual frame of balancing the potential for reward versus loss. (you can get the test here)

In the task, the participant is presented with a balloon and offered the chance to earn money by pumping the balloon up by clicking a button. Each click causes the balloon to incrementally inflate and money to be added to a counter up until some threshold, at which point the balloon is over inflated and explodes.

Thus, each pump confers greater risk, but also greater potential reward. If the participant chooses to cash-out prior to the balloon exploding then they collect the money earned for that trail, but if balloon explodes earnings for that trial are lost.

Participants are not informed about the balloons breakpoints; the absence of this information allows for testing both participants’ initial responses to the task and changes in responding as they gain experience with the task contingencies. Risk taking is a related, but phenomenologically distinct process from impulsivity.

This gives us a great window into seeing how people think and what their thresholds are, our real life decisions around risk also go through a similar mental model and process. But our affinity to take risks is based on a host of things, I believe one can train ones self to increase their risk appetite if they start thinking along the lines of asking them selves which is the right risk for them?

So whats the right risk for the person driving into oncoming traffic. Could the threat of loosing their job if not at work on time result in taking this risk. Yet the same person, doesn’t consider leaving the house 20 mins earlier to make it in time to avoid doing this dare devil feat. So the risk they are willing to take is battle traffic, which by their mental model is some thing that they do any way and have trained them selves to not get worried about. So Job loss is a bigger loss than loss of life or personal safety. Which any where else in the world would be near impossible to fathom.

There-in lies the opportunity. Our unfair advantage, is our mental model for risk just like our biological immunity is shaped due to our filthly environmental realities which are much harsher than most places on the planet. We dont start our exploratory process on risk with asking our selves, “whats the worse that can happen?” I feel, because our starting position is such that the worst has already happened in most cases and any other change to the system will only be positive, so we are willing to do some outwardly crazy, extreme sport level risk items without even giving it a second thought.

Let’s look at the person without any protective gear in the midst of what seems like a poster for a Darwin award by electrocution. He knows there is no protective gear available, he knows he has a job to do, he’s on a car mounted hoist, so likely an official worker of some kind, albeit not just the power companies. How does one even capture what the right risk for this person is? In short, it seems that we do things counter intuitive to even our survival instincts. So in a nation and people that demonstrate this level of risk appetite, how do we translate this to actionable items and use it for incremental, sustainable gain vs using it to win Darwin awards? Its simple.

Many people feel the same urge: the desire to venture past the limits of safety in pursuit of a rewarding experience. The truth is that we are very bad at estimating risks. People are afraid of getting on planes, being afraid of it crashing. Even if they are shown the actual statistics of plane crash occurrences, they can never be convinced of their safety. The person next to the electric pole has an overconfidence bias, because they either cant visualize or process that electrocution is a real threat, where in they are relying on their skill alone to over compensate for that risk. Whilst ppl avoiding flights since they cant see the pilot do not want to hand over their fate to some one else. Whilst in reality if they drive, there is a larger likelihood of an accident. But the right risk for them is to be in control of the car.

We take risks because we want to gain from it one way or another, and think experience is a good measure of its actual risk. When it really is not. We need to harness our ability to identify the right risk and not allow our experience to shape our risk appetite.

Our unfair advantage… that our general risk profile is fairly high, be it society, pressures, ingrained set of values, lack of fear, different perspective of life after death. What ever the case may be here are some thoughts on to harness them better and have a framework for taking bigger bolder work related risks especially for startups once you understand the underlying thought process.

Those who take risks already have a competitive advantage
Since most people and by consequence startup leaders tend to avoid or minimize risk, those of you who are brave enough to take risks have an edge. Just like a first-mover advantage, when most individuals stay away from risk , that means less competition for risk-takers. So use your ability to take risks as a competitive advantage. Push the boundaries a bit more, also calculate the what ifs and the outcomes for sure, but then push a little harder. See what happens, if you get dis proportionate sized rewards, push a bit more. If not, and the tides turn, re calibrate and have a back up plan. Don’t get into this without a plan. Go in it without fear.

You will finally not have to ask your self “what-if” or contemplate what could have been.
The quicker you are regret free the faster you scale and do other meaningful things. Mean do what you must, so when you are 90 yrs old you aren’t regretting you didn’t do it, because regret is not a one time thing, it builds over time and has a crushing effect on your soul. Do it get it over with and if it works you have converted your ability to take risks in to some thing meaningful, if you dont, then you have the rest of your life wondering what would have happened, are u ready for that trauma Get out of the, should have could have syndrome. What ifs like assumptions are the mother of all f-ups. So don’t assume, instead do.

 You learn from taking risks. So Learn faster.
Nothing ventured nothing gained. Some risks may not pay off, but an optimistic risk-taker will always look at failure as an opportunity to learn. Do it enough time, your odds of winning go up. Be a winner. Learn from it. But dont let your former risk profile let you determine your future success.

Learn to live with what you can live with , when it comes to Risk.
We all have some thing we absolutely cant risk. Make a quick list of all the risks. in your space.

1) Credibility Risk
2) Credit Risk
3) Operational Risk
4) Market Risk
5) Legal Risk
6) Technology Risk
7) Competitive Risk

What you think you cant risk, cancel out. And over index on the other and push the boundaries to gain your un fair advantage.

Over time, you will find out that these challenges — distance, difficulty, confusion — are actually the benefits of getting out of your comfort zone.

An other thing or way of thinking that helps is to not have a defeatist mind set. The biggest fear associated with any risk is failure. The possibility of losing money, being humiliated, or making the wrong choice is enough to make us say: “ok lets not do that”

What if you could always take risks, but never fail? Imagine that, all of those things you fear doing, suddenly didn’t have a downside. Imagine that, every time you wanted to go for something — a better product design, a new hire or a new business idea — you would never feel pressured by the fear of things not working out.

Seriously, think about it. Would you still make the same choices you make today? Then re calibrate. Thats what I tell my self. Once I have decided I am going to do some thing(after due process), the chances I do it right are much higher if I believe I am not going to fail. Try it some time. Having faith in your self is the first step in the risk reward journey. If you continue to question your self, you create a bubble of self doubt. The last person you need doubting your actions is you.

Sulking wont fix it.

If you fail once get up and re start. Also fix the vernacular of how you define failure, re adjustment or pivoting is not failure but a way fwd when the first plan doesnt cut it. Those who can identify this opportunity can move ahead faster and have cleaner re-starts as needed. Understand that you are going to keep failing and there’s no way around it. You’re going to keep getting hit, but the only thing that matters in life is how many failures you can take and keep taking risks. The day you stop taking risks is the day you get in to you regret cycle.

Life and Startups without risks suck.

If you keep training your mind to avoid doing little uncomfortable things, it becomes natural to avoid doing bigger uncomfortable things, no matter how rewarding they may be. So live a little, train you self to take risks move away from stupid risks like driving on the wrong side of the road and channel that energy into some thing that give you an unfair advantage. Dont loose that Pakistani streak of venturing in to the unknown, instead of venturing in on dumb things focus and execute better on bigger issues. Find the right risks and the right rewards will find you.

Market Product Fit. Surprises and why founders should explore them.

A single Google search will bring you to gurus of product market fit. This is the exact opposite thinking. I had recently solicited ideas to feature in the blog post. The one below got me thinking.

So how does one go about solving for the non obvious? The basic construct in my mind is to not build products that you then look for a market to sell. It’s a mind set thing. You must look at the market first, product second. Its not the usual way of thinking about these things but its always harder to convince people to buy your sprocket vs the next guys. Look for a market where people are using sprockets with ropes tied to them and no one producing them en mass. Be that guy/gal who adds the rope to the sprocket. The market exists but isn’t either sexy enough or cant be Googled or outside of your circle of immediate relevance but that doesn’t mean it doesn’t exist.

The Small road to big Markets

Think about it as the road to building 1m$ companies vs 100m$ ones(you will eventually get there). There are enough things out there that have things tied to sprockets that we are all missing, whilst we are subconsciously driven by  mental models where founders are inclined to make a product (or get an idea) first and then go out in the market to test it. Failing fast is great, but this sort of mental pre disposition can lead to failing before even starting.

If you start with an idea and in your circle of relevance every one says wow, great idea, it will work, its bound to be a successes. What you have done is gone through a validation process and now have an overconfidence bias because you tested with the wrong demographic and have incomplete information.

If you started with a market and found a product or service that consumers are hacking their way to make their lives easier, as an entrepreneur IF you can improve upon and standardize for the rest of the market you would have a better chance of building a 1m$ company; than you trying to build a product for a market that you didn’t evaluate beforehand.

But the million $ question here is to ask yourself: What’s an offsetting behavior? Would you know it if you saw it, meaning can you identify it? You cant just go ask consumers what they did and take surveys to collate all the info to build a better product, in most cases if it were that easy it would already have been done.

So what are you really saying? What works then?

Look for things with shock value. Look for crazy patterns. Look for Surprises. Look basically for the odd/peculiar/inconsistent things in markets. In most cases people don’t even know that they are compensating for a products lack of features or hacking their way for better efficiency etc, you have to stand tall and observe. People are un aware of the need because they have always compensated for it, by adding their odd solution or signature fix to a problem.  Ways to discover market-product fit is to first define an area or space you like or as passionate about, second you must have some un-fair advantage in the space, either by qualification or experience or both or even having information and having a better way to analyze it. So if you have experience in horse breeding best not to be looking at hydrogen cells as the market to disrupt.  Every morning when you wake up you should ask your self, the shouldn’t questions.

What is happening around you but shouldn’t be happening? What shouldn’t be happening around you but is happening?

Coming back to the initial item, once you have identified the peculiarity, the question to solve for is the Why? Why are people doing things a certain way.. Would your potential clients do it too if it was a) Legal, b)faster c)cheaper. The worst mistake is that you copy a customers behaviors and masquerade it as solution.

You will win when you know their underlying motivation and design based on it. Also note, not every thing needs more tech or any tech or any digital any thing. Some times its better to focus on providing a frictionless experience what ever the channel may be.

This shall give you a launch pad, but it’s key to dig deeper and understand as many angles as possible and whether solving for it it represents a valid business opportunity. Don’t just embrace the 1st idea that comes to mind . Learn how to distinguish between signal and noise. The positive signal is usually an indication of confirmation bias at play. Be cautiously optimistic..

Here is how I think about these things.

  1. What are millennial’s obsessed with and what is it that I don’t understand about it? Is it trying a particular kind of food, fashion? What are they using to communicate, are they sharing/over sharing.Why are they doing it? Is there a better better mouse trap that can be built to accomplishing the same desire? Because I know the market is far and wide.
  2. What continues to piss people off or make for annoyance in their lives, yet people continue to do it? Some thing like watching videos on loud volume in the presence of others?(a habit displayed by boomers of every kind). Cell phones ringing in meetings? Long queues at the bank and now long queues at retail chains. Why are they doing that? Is there a better way? The market is there, can you hack your way into it?
  3. What are people doing that is illegal or not fully endorsed by the law? Avoiding taxes(national sport), buying drugs(rising popularity), speaking freely(massive media bans and the fear of repercussions). What are motivations for those behaviors? How would you address those motivations in a legal manner? Is there a legal manner, could you motivate people over time to cross the spectrum in to legality? Again the market for non-tax payers in this country is pretty much every one. What does that market need?
  4. What are things people need daily/weekly/monthly/yearly that could be solved for by subscription yet people choose the most inefficient way to source them and always complain about it? The way to look at this deeper is by asking is there an Existing community of enthusiasts or people with a need? Evergreen category?Audience that is looking for continuous discovery(niche). Recurring need (grocery/masalas/card re charges), Customers who want to make someone they love happy(Gifting/surprises/support) ?Emotional connection(News papers/childhood foods/ethnic items)? It’s a way of life (think : runners, cyclists, knitters, diabetics, high-blood pressure/medical conditions.) The idea is to understand that markets for these exist. You have to discover/find/identify the market first, because its where they need products. These markets are ready for the taking for those who have the patience to work backwards and introduce complementary products.

An other item that I cant classify, but id like you to think about are communities as marketplaces or Muhallas as Markets. Why do I say that? I now spend a dis-proportionate and likely un healthy amount of time thinking about logistics and distribution.

Every day I see trucks delivering Drinking Water in large bottles to neighborhoods. In a typical setting say in a dense urban area, where there are sprawling buildings and homes alike, I see 10 brands of the water being delivered by 5 different people or individuals hiking the bottles across 1 at a time over the week as needed.

If we assume water quality to be the same and or similar and price points being the same(in a given muhallah), why isnt an entrepreneur going to this market and converting 50 buildings and 100 homes to sign up with them. Then become the distributor by having purchasing power advantage to target this captive market. Similarly in upscale neighborhoods from Nestle to Culligan the bottles and trucks are zig zagging across.

Why wouldn’t some one try to consolidate the market and work on building their own distribution or brand even. In my experience most people call the brand they know and then get a delivery set up, you can invert the funnel, instead of the brand passing the lead to the distributor you can be a captive market player the other way around. What if you worked backwards on this market. Own the Customer and build a better delivery/distribution mouse trap. The idea being, the market is there , you don’t even have to make the product but you will succeed if you make it stand out, either by pricing, frequency of delivery, pre payment, door step credit cards, wallet payments etc. Sometimes all you need is a notepad and the ability to sit down and take notes. No AI needed. Observe the market.

So if you treat your neighborhood and muhallas as market for products and services you will now be able to do a market product fit more easily. Look at what all this market consumes and what advantages you can bring to it (this is just a simple example to start thinking about the process and how to identify markets) Also this isnt the only way to think about a market.

A market could also be where people who are geographically dispersed but aligned based on need (People in cold rural climates nation wide who need affordable winter clothing likely delivered to doorstep sans online). So no one right answer.

In an effort to make this article/post interactive. Ive put out a tweet that you can reply to, sharing what you think are some great market-product fit ideas especially when you think about ,things that shouldn’t be happening but people are doing anyway and how some one can build a better mouse trap or convert that market in a whole new way. So share all the non-obvious opportunities so some where, some how an aspiring entrepreneur can take a crack at that market.

Pakistans Missed FDI Opportunity, Telco + E-com Dreams…

What do Facebook, Silver Lake Partners, Vista Equity Partners, General Atlantic, KKR and Mubadala have in common? They are all partners with Jio in India. This means a total of $12.96 billion has now been promised from seven investors in exchange for a stake of just over 21 per cent. While Jio is building its e-commerce engine and monetising its telecom asset from strength the strength, we cant even get our basic Spectrum licensing items sorted out in Pakistan. Besides that we have no real #DigitalFirst leadership, we have digital thaikaydars like flavour of the government kind. More on that here.

Whilst every one is in lock down the natural outlook should be one that promotes government + regulator + Telcos to use access to internet and tele-density as positive levers and promote marketplace enablement. Save for Ali-Baba Daraz tie up which is also experimental in the way that traction is visible and the brand issues that plague Daraz, no Telco has taken the lead to follow Jio like path.

There are many paths to monetisation, let’s look at the India JioMart model.
They can initiate an order by texting to a Whatsapp number(Same Whatsapp that is owned by Facebook and that has 400M customers in India), which prompts a link that opens a mini store on the browser, allowing them to pick a range of grocery products including toothpaste, snacks, tea and coffee, rice, and cooking oil. This was pre-Jio/FB deal, the integration may grow and likely will.

Once an order has been placed, which currently does not include a way to pay digitally, JioMart automatically assigns a neighbourhood store to them and sends an invoice through WhatsApp. More than 1,200 neighbourhood stores are engaging in the pilot program. Do you see the potential, converting all local retail to be partners and fulfilling orders B2B2C.

Whilst the news of Tajir and Bazaar and other startups who want to disrupt the Kiryana store space(by trying to help them do their own b2b procurement, their pre seed is pittance at 3.1M Dollars compared to the Bn$ plays possible), it takes one strategic alliance with the likes of a Whatsapp/FB Store front to up-end every one else given the captive user base.Not to take away from the domestic raises, they build continued confidence and will lead to more plays in logistics and fulfilment, thereby creating on ground jobs.

Think dark stores operated via local operators and a unified order taking system via Telcos. One may not have to follow the same path in every locality but the captive user base is an advantage that Telcos + WhatsApp both have, how people our companies end up using them is their call.

So what are our Telcos thinking? Likely nothing. I think they continue to be happy with making money on data and voice. No serious value added items are visible. If you count micro finance and peer to peer payments then yes. But imagine if you are a Telco and you can enable 100s of thousands of business in the current scenario, what else would you rather be doing? But I doubt any commercial activities are happening in that space. From what I can see on MOUs and PR notes abound, is oneupmanship of counting product/feature updates.

Let me save you some time. Most are patting them selves on the back to have launched WFH Data Bundles, they are also selling Golden Numbers, Some have agri weather and rural lifestyle services, in using for a week, see a missed opportunity given how cumbersome the services are. Last but not least, one is fixated on how super its card recharge is and continues to market the shi* out of that one idea. Ones busy TikTokking till you drop, or selling bundles to use its most popular bandwidth consumption tool. You can guess which one. Visit all 4 sites and you will see this data/Telco first strategy.

With all whats going on by just visiting their site, the maturity of thought is evident and as it the thought process. Jazz had a DFS Play and a separate CEO, but that didn’t last too long as there was a leadership change at the top. Telenor thinks like a Telco and now more so than ever the Bank and Telco seem like to 2 different strategic plays. U Bank seems to be opening location after location. I think, there the divide and use of data between Telco and Bank is perhaps the deepest. Zong doesn’t compete with Chinese companies as a matter of China first policy so it seems there is nothing new coming from that front just yet. Whilst Alibaba is aligned with Telenor this is a strange mix.

The core issue, that no one will talk about is one of personalities, these Telcos are led by Telco first, forward thinking executives, who have life time tenure(till they don’t), theres nothing bad about it, but they are the Steve Jobs to their own employees, sadly. Hero worship at an all time high and no one challenges the status quo, the amount of money Ive seen wasted since 2014 on CEO Led ideas that teams said, its a brilliant idea sir = equal to Millions of $ that if they had invested in local startups would have given better outcomes. Thus all this FX potential, market place innovation, last mile data , multi party integrations just don’t make sense. I feel, because the lense is wrong. It likely wont, given they even treat the micro finance arms as license vehicles vs fully inter operable command centers that one can use to catapult the payments play + e-commerce play. They are still doing better than traditional Banks, but that tells you how badly the Banking items are lacking.

The employees at Telcos, like the FMCG folks are ‘brand’ people, most of these folks have one or 2 products these 3-4 former Telcos launched, every ones resting on their former laurels. The smart ones left and joined Banks and are trying to make peeer to peer payments sound like gods work.

No net new innovation is happening and every ones out to dick-swing their own peers by being territorial. Most telco and Telco Digital Bank convos start with “yeh hamaray baray puranay xyz sahab/sahiba hain” I am not suggesting we replace the old, I’m merely suggesting what no one else will say due to either fear of retaliation from the companies or their executives. The Owners/Principal share holders of these telcos need to ask, ” is it time for change/infusion of top talent?” When you continue to rely on incumbent leadership, do you think they will ever let any one else flourish, its a human instinct, for all the talk about leadership at all these companies, there is no real number 2, there is no real commercial leadership. Titles and roles yes, depth of talent, likely not.

It is largely due to human nature and not due to personal insecurities. But it is evident across organisations in Pakistan at the Top. Vacuum, even for family owned businesses if the Patron lucked out and has smart kids then it works out, else the hired help is always just that, hired help taking direction from dimwit second/third generation. Sadly our telcos/micro finance Banks and even traditional Banks are operating like saith shops, contrary to India, where at JIO the owner is where the buck stops, there is clarity of vision and massive enabled leadership teams who are duly qualified to lead the charge, they aren’t afraid of which sahib from which Telco can replace them. They are bending the boundaries vs our guys who a building fences to retain what they have.

Its also cultural, the Telenor Principals based on their own pedigree (Nordic) reward loyalty and serious level of non-confrontational personalities. Zong, is all about China first so what ever is prescribed from Mothership comes across is what happens. Ufone is getting more and more inconsequential till it gets prioritised and packaged and sold to one of the three or may be a new entrant. Jazz is interesting , with a mix plate of ownership roots and talent and a CIS + Regional focus beyond PK + Bangla they have made seriously bold bets that have failed. So likely in retreat mode especially during market contraction times by focusing on Telco that has worked for them always.

For starters we should encourage the Japanese example that I read about a few days ago at these companies.“Most people want to become wealthy so they can consume social status. Japanese employers believe this is inefficient, and simply award social status directly.” The best employees aren’t compensated with large option grants or eye popping bonuses — they’re simply anointed as “princes”, given their pick of projects to work on, receive plum assignments, and get their status acknowledged (in ways great and small) by the other employees.” If we did this, we would unlock so much more value than we already have.

It does help to understand whats going around us to then try and diagnose how to solve for it. Jio has an other weapon that I have written about in the past, a feature phone KaiOS Enabled with a voice first strategy. Once they conquer the 400M addressable population size of Indian WhatsApp users/ala Facebook, they will bring on a blended voice based experience to the rest of India through voice. We have 89M non smart phone users that if these Telco start thinking about can offer a host of life altering and revenue generating possibilities for both parties. We barely have the smart phone market addressed let alone the feature-phone migration ready one.

It’s not very hard, given their scale, the Telcos can bring in global partners to do what seems so obvious in India, which btw is also freaking out Amazon, Walmart and all the others who paid Billions in premium to get into the online commerce space. The Telcos in Pakistan have a rare opportunity to be the largest consumption, demand and distribution channel all in one. The only question they should ask them selves is, how long are they happy to only be the data pipe provider to Youtube(highest consumption of data in the country by some measures) or TikTok without owning others pieces of the pie. Sadly in terms of economic impact, all the data they sell, enables content consumption, which enables monetisation, which results in indirect-fx losses via advertising channels to Google and TikTok and even FB. In the absence of locally compelling propositions or deeper tie-ins with international vendors they continue to enable the successes of every one besides their own true potential. The Telcos perfectly manicured PR releases makes one think that they are dreaming big. But it seems like every ones just day dreaming.

“One man’s daydreaming is another man’s day.” – Terri Guillemets

One Idea Can Change Your Life & other things that (typically) don’t work in Pakistan.

Gone Too Soon

I don’t really know what happened to Benlays Doodh Patti. I do remember that for a brief period, all the ex-pat Pakistanis I knew could not live without it. It was some thing so simple yet so profound. DoodhPatti is to Pakistan what Coffee is to Americans. People were willing to pay 14/$ for a 24 pack thats a $1.7 a serving or PKR 272 in todays effective rate. (Imagine the FX impact)

The box even says trade mark protected. Lo and behold it is.

It is registered via a law firm in UAE, which was easy to locate given that PoBoxes seldom change any how will skip that.

The contact info

Whilst I dont know the history of who Benlays was and what they did, their address for SITE and phone numbers turn up Ahmad Manufacturing Company. . Same address same every thing. Suspect some textile group had in the past tried to diversify and realised it either didn’t work or the margins weren’t the same as textiles. What ever the case may be it no longer exists.

So what is the point of this history lesson and going down this rabbit hole? It’s fairly simple, that successful outcomes for products and product driven businesses are exponentially low in Pakistan. Have you ever wondered watching shark tank how one good idea, productised, commercialised and launched in retail or franchised results in millions of dollars of wealth creation? Our problem is both of innovation and lack of commercialisation. Lack of commercialisation because we have little to no co-packers, we don’t have the home-to-commerical transition infrastructure, where it does exist it is next to impossible to find. Our existing brands are limited and some are dying too(See thread below). Yet we all know some one who makes an incredible sauce, chutney, mix, rub or some one who has other ideas/gadgets or totkas that can be commercialised. But we rarely ever see any one breaking out and commercialising products.

Now more so than ever both for local consumption and for export we need people to rise to the occasion and start with producing shelf stable products as a start. We need both import substitution which people like Dipit are doing, seemingly a Shan Foods venture.

Shan Foods on

Speaking of Shan they are available on so clearly they have found their way across the pond. Yet from smuggled Goodrej, Dabur and Amul and himalaya all the stuff is available in Pakistan. Why cant we get our iconic brands any where? Besides Shan that is. So coming back to the idea, that one idea can change your life, how does that item continue to work in the US and not here? Why can people be a one hit wonder, take the example of Scrub Daddy not in the food category though or Bantam bagels going from Shark tank to Starbucks. Not like we don’t have a consumption hungry population from CPG to FMCG demand being super high. Yet we do not have domestic FMCG or CPG brands being developed or growing. We have the same players who continue to grow.

Our problem is many fold, from lack of product development expertise, to developing packaging to material sourcing, product testing, sampling, distribution, supply chains. None of these are easily available to most people. If you had the next killer Achaar, how would you go about even bringing it to market so it doesn’t look like it fell off the back of a truck? From perfecting the recipe to labelling to nutrition guidelines to shelf stable testing to getting quality accreditation and sourcing and production. Some thing to think about, is to maybe build the infrastructure to allow fo this to happen. Build perhaps a co-packer? So think Cloud-Kitchen but industrial scale. Having a common core infrastructure so that you get economies of scale. Not just for food services even though the bulk of my examples are in that space. At large we need an enabling environment for people to take an idea/product and be able to commercialise it.

Before we start trying to develop Kombucha , Keifer Grains & Greek Yogurt we must learn to be able to produce Lassan Adrak Paste and or Canned tomatoes ala Italian ones which we pay 170 PKR for, we need a whole sale commercialisation revolution and folks who can help with GTM Strategy for these areas. We have an acute shortage of food services experts. We have no locally branded products that at-least I can name in each of these categories that comes to mind instantly

  • Locally produced Sponges
  • Locally produced Tooth Picks
  • Locally produced Ear Buds
  • Locally produced Phool Jharu
  • Locally produced Poncha/Mop Brand
  • Locally produced Buns besides ( Dawn/Bakeparlor)
  • Locally produced Masalas (Laal Mirch, Kali Mirch , Dhaniya – Besides Shan/National)
  • Locally produced Hair Oil
  • Locally produced Packaged Beef Products
  • Locally produced Cream cheese
  • Locally produced Canned Tomatoes / Canned Fruit/ Canned Mushrooms/Peas
  • Locally produced Cosmetics Brands

We need to give people hope that if they try hard enough and if they have a great product that some day (soon) we will have the infrastructure(process/technology/financing) to allow for them to break out of their social and economic predisposition. It seems like, unless you come from money you really cant or shouldn’t be in the products business/manufacturing etc.

For a nation obsessed with food, recipes and then some why aren’t we encouraging an entire generation of kids obsessed with building unicorns to moving to building recipe mixes or food products at scale. Halaal BBQ add-ins for example. We haven’t gotten past juices that too aren’t 100% indigenous and we continue to not evolve or innovate. So what does it take for us to leap frog so that our ideas can change lives? That for once things start to work for us too. We are caught up in such systemic disadvantages that to break the mould we need whole sale changes in no small part from education to government to the boys in brown and no I dont mean UPS.

Understanding & Building for the Dopamine Generation

Median age by country in years in 2017 (U.N.). The youth bulge is evident in parts of Southeast Asia, the Middle East, and Africa.

There is one App that has taken the youth bulge by storm every where, that is TikTok. At its core its simple short-form entertainment that has some Chinese pixie dust(aka Algos) that bring virality to content by creating crazy in-platform exposure. This generation is all about instant fixes, when it comes to tiktok where videos are sub 60 seconds, these short videos have created and curated a new type of addict and addiction masquerading as entertainment but driven by the consumption economy. When your users are spending of 52m/Day on the app clearly byetdance the 70bn$ company that owns tiktok did some thing right.

Youtube, Instagram and Snapchat have a similar but different consumption/virality vibe and also creating their own versions of dopamine filled experiences. So what is it? That is driving audience to this consumption economy?The way it works is simple, Kids these days look up to influencers(we had national heroes, sportsmen/women, business titans, celebrities who took ages to make their mark in a space), the premise has remained the same but the thesis has changed, those people that have millions of followers and can do whatever they want because they have a pretty good amount of money are all the rage. Every one wants to be like them and follow what they do and are led by them like a cult. This is not really promoting scientists or particle physicists, from the outside in, it may even seem like a steady dumbing down of what passes as stuff worth watching or following.

In short, all you need is one hit to get noticed and the kids know that between their chosen platforms, they don’t need any special skill set and “it could happen to them” The definition of a good piece of content is also changing. Also it just doesn’t need to be mindless content, to test this hypothesis I combined some pre existing content on sufi music, I made a short 55-second video about the origins of it and got 6800 views in a day as a first time tiktok user not even having an account prior to this. Truthfully its not a bad place to be, instant recognition by views? In the end it’s pretty simple, all these kids are trying to do the same. Its like one of those toy claw machines where every one wins atleast one prize, for one coin put in you can try till you win a big prize but if you loose you are guaranteed the the base prize always. TikTok has personified and cashed in on this. How hard can that be? There are short form items which tiktok is good for then there is youtube for every thing else mixed with insta and snapchat.

If you don’t know drops and kiks I suggest you familiarise your self here first. Things are changing fast, as are monetisation avenues and engagement platforms. The new normal was barely normal before Covid-19 came around and forced an entire generation to work from home adding crazy growth in online content creation and consumption and in turn fuelling new brand creation and growth avenues. Their perspectives on consumption, education, work, products, content is miles apart from where traditional businesses and marketers are focused. Locally, regionally and globally the trends have fireballed into an ecosystem that most people don’t have a window into. Heres a starter pack that I’ve put together for you. (of all places twitter recommendations)

New Media – Digital Distribution – Engagement Tech

Nerd Stuff – New Tech – Platforms

Content Creators – Content  Driven Merch – Gen D Collectives – Agencies

Food & Nutrition

Misc Stuff

All these are examples of brands, products, icons, influencers that are creating, making, selling and consuming in their own bubble/ecosystem for the most part without outsiders having a real window into the business of GenD(dopamine driven)++. Some have cracked the nut, there are specialists agencies managing “talent” being run by a much younger crowd, not owned by the existing media outlets and brands, they have developed their own origination and consumption patterns, whereby select “merch” is listed and “dropped” to a select audience, and people can pay to queue jump, these things are not sold in stores.

Do you see the opportunity for the post corona world? Do we have our own local versions? Is any one building a list of these influencers? Are our Sahab based agencies that profited off sleaze-ball agency owners and their cronies in tv channels by profiteering off rack rate khanchas, ready to manage this talent and brace for the new era of consumption and influencer driven advertising? Are our less than adequate news channels ready for a generational competitor? Whilst a host of the media end of this landscape is and will remain a fairly western phenomenon, a large part will be our ground reality as well. Most of our influencers are any thing but, due to a lack of original content and programming the audiences they command are a mix of folks with pent up frustration, aggression and voyeuristic tendencies, so not too removed from the stuff being promoted in LA.

In our case the mass market has a window into other peoples/rich influencers lives and some thing to look up to, they feel like they can relate to them, albeit that sentiment maybe universal. But there are major influencers with audience followers in the millions who are not leading or promoting the glamorous life, they are rural tiktokers with massive fan following. The audiences sizes for example give one an idea that if brands were able to harness the raw power of these following and if these influencers were business savvy they could turn their audiences into an economic power house, from brand building, licensing, product endorsements and perhaps money left over for some education. Its a dystopian view when you go to to discover the latest local videos.

Similarly on instagram the following folks, are being followed from Pakistan most, some of them are not even Pakistani. This gives you an idea around the flavour of the content being consumed and what the audiences crave.

Moving on to youtube and looking at audience metrics we see a different kind of trend in channels driving large section of views(some are still traditional). Whilst most aren’t, yet A host of this content is religious or sensationalist news. Not necessarily targeting just the youth alone but a huge chunk of it is being consumed by them whilst a host of it is being created by younger creators. Interesting trends emerge when you go from TikTok to Instagram to Youtube, the audience mix, the monetisation capacity, the content, the demographic mix all changes completely as the format of engagement changes.

So whats the moral of the story here. We like all other countries with a young population and an ageing population have not only social issues coming up, we also have major societal issues, whereby there is zero adult supervision in what is being created, consumed, distributed. This will bring with it, its share of complexities, issues and also opportunities. There is also a real social divide happening where there is a stark socio economic disconnect between the influencers and the people following them that in the current socio economic condition(s) only lead to a bigger online and offline divide between the citizens of the country. With such chaos comes opportunity and we have a host of pre existing examples globally to learn from on how to navigate this complex dopamine powered web. The real winners will be those who can get ahead of the curve and integrate this new reality in their existing and post corona growth strategies. If you don’t get in the line of sight of Gen Z/Dopamine today you will be irrelevant in the years to come.

Beyond, Bike Pay Bhijwain & Cash Uthain Commerce (Send via Bike and Collect Cash Commerce)

Visualise the following. You are launching a business, any business, the end product needs to make it to the consumer and the consumer needs to pay for it. Easy enough, even the US hasn’t solved for this seemingly simple concept at scale and at an affordable price-point. Dont confuse Amazon with the US and play along. Instead of looking to the West for inspiration, time to look East. The Chinese ecosystem has many things no one has, for sure 2 things the Pakistani ecosystem lacks API driven PAAS(Payments As A Service) and programable Logistics/Logistics of Things. So what does this have to do with any thing? Look around you, as nearly every thing is shut down and businesses struggle to survive we need rails to enable the post covid business ecosystem in this country.

Follow along.. Startups in Pakistan or businesses have to solve for both of these issues on their own, most days. Thus ideas that look good on paper don’t scale, because they are DOA(Dead on Arrival) due to the lack of any pre-existing infrastructure to plug into. Conversely if you are in China you can deploy your product or services by plugging into and using pre existing API Rails- what you get in return are cheap easy payments and same-day/next day delivery out of the box. White labelled, transparent. At such a scale that it doesn’t matter who does what leg of the payment or delivery. The price point is so affordable that every one wins as the eco-system grows. The Chinese figured this out long time ago thus witnessing astronomical scale and growth on e commerce and deliveries.

If we look at payments alone, we have nothing in Pakistan that works independent of the VISA or Mastercard Rails, (Granted we have One-link) every one has to pay MDR, but as of Feb at the new rate of between 1.5-2.5%, we barely have functioning IBFT that has no payment hooks built in, let alone prior to Corona even those carried charges not very palatable sans modern day tech bells and whistles. Across the pond Alipay and WeChat Pay are sub-50 basis point & highly available + they have their own verification protocols and one click payment options or alternatives. We continue to use verified by visa and others and burn FX on imported solutions. Our Goal should be to replace Visa and Mastercard with local payment schemes (PayPak any one?) and get on with life.

We can learn from the issues in the West, that despite Paypal, Stripe , Square and the likes thereof , every one still relies on expensive transactions on some one else’ss credit card rails. So masoom Pakistan is no different but just like we leapfrogged from land lines to cell phones we can emulate the China model on this one, or some thing close enough.

Popular Chinese Digital Payments

Switching gears and looking at Logistics, Alibaba and others in China invested heavily to make sure there were competitive logistics solutions and rails. If we look to the US and Amazon and try to wait or imagine some one will come and build self owned end 2 end logistics rails, likely that will never happen. Whilst Amazon has built an unmatched first mile, last mile logistics service, it has been at the cost of FedEx and doing enough value additions and dollar spend along the way to make sure UPS, and USPS cant keep up. In China there is enough logistics on demand capacity for any one to stand tall on the shoulders of other giants if they decide to ship their product from any where to any where and get paid instantly for it too. We are still struggling to decide who will get an “in principle agreement from the SBP” our ffing tax rupees pay for the folks we need to demand they get with the program vs getting in line and pleasing the makhanchoos who are nearing retirement and continue to be so afraid of the NAB that they better not do some thing exotic. *(tons of good people around too hence what ever progress to date, but its SBP its not Tesla so we must also be realists) These things wont fix them selves, book a tour to the SBP if you havent been. Then ask your self why we need govt policy level intervention. For a comparative see the above image, for benchmarking.

Chinese Ecosystem & Players
Global Tech Ecosystem & Players

Whilst we are busy fighting the correctness of prose and vernacular of Ramzan Mubarak and Ramadan Kareem we should actually be focusing on thinking that if we start a company, a business a service today, we have the luxury to build on top of the work of giants that came before us. We can stand tall on the shoulders of used smart phones and their processors to build mining rigs for example, or use existing networks of others to build adjacencies like using easy paisa agents as a distribution network and reimbursement network.

We take all this for granted, but we are standing on those shoulders like it or not. Evaluated in the our current context we are missing two key shoulders to stand tall on for e-commerce innovation or new biz innovation. PAAS(Payment As A Service) and LOT (Logistics of Things). Both are ecosystem plays, both are driven by less regulation more openness more standardised data exchanges. We are in the wonder-years for both ecosystems. Nothing concrete has been done industry wide, as we are all busy leg pulling and un-doing any thing of substance plus given our genealogy of rent seeking behaviour, we just want to dominate the market and take un-godly profits thus we don’t work collaboratively. We believe in holding all of the pie vs growing the pie.

Show me 2 Desi businesses in Pakistan that have thrived by working together? and the sum of their collaboration being larger than each individual group. This precludes GBM(Growth by Marriage) or MBIB(Merger by In Breeding). Since Ali Baba and JD actually dont have a Baba or Mr جیدی and consequently no vested interests of family or dynastic issues, they have continued to grow, we cant get past Sahab, Sir, Boss.

At a policy level, we now have an IT Minister who you should try and Google, but if you must, you can click on the link to his official profile and fill me in as to what the credentials are; to be justified, to be appointed and why the current Govt refuses to put some one from within their party ranks to the IT Ministry. Is it because they know they will make a cluster out of it and giving accountability to constituents that bring in 3bn$ of inward FX would be a tough one to defend online?

Im sure, MQM would be happy to take some other ministry. Refusing to allow some one credible to help align the national narrative on tech, the government is doing a dis service to all. This Govt has the most Spammers( I meant , SAPMs to the PM. They are like a shadow govt. That shadow govt has its shadow lackeys who are advisors to the advisors to the PM. First we used to have members and secretaries now we have self established foundations and self appointed elves who are running around advising the advisors. Yet there is nothing definitive viz a vi policy around Digital Pakistan. We need less Webinars more work “less narrative building” “less cutting pasting” & “less self-reflection”, abhi juma juma aath din huey hain aur advisory cadres “reflect” kar rahay hain. This is Telenovella level shit.

بھائی کام کر لیں ، چلیں آپ کو تھوڑے سے آئی ڈیاز دییتے ہیں تاکہ آپ بوٹ شوٹ سے آگے بڑھیں

To quote a dear friend, “the state has a role to play, but the state continues to politico-hire/acquihire consumer tech folks from sales, they should at least hire some one from enterprise grade tech who understand ecosystems and frameworks. Else we will continue to build bots and leaderboards to self assess self proclaimed achievements” (JDIQ 2020 April)

On the subject of ecosystems and visions beyond ones own self interest, an other lingering issue every successive incumbent IT Board/Advisors/Mushir/Wazeers in tech have had, is to start competing with the general population. Some one tell me what business we have as govt to setup portals for volunteer doctors, for example whilst you have at-least 5 or 6 commercially available tele-health startups/post startups, with scale who could have just turned on the switch to register all the expats. I dont even want to know the effort it took to replicate/emulate pre existing services also the govt is now competing with the same startups who pay tax rupees to the exchequer but this portal wont. This systemic desire to self build to show momentum to count stars in front of the sitaray walas is not optimal.

ham ko ma.alūm hai jannat kī haqīqat lekin
dil ke ḳhush rakhne ko ‘ġhālib’ ye ḳhayāl achchhā hai

Enough digression but there is a reason to share why we are where we are as we continue to be driven by self interest. Before we get #DigitalAnything or #DigitalAnywhere, we need to be self aware, state needs to promote its constituents not compete against it.

We have mis guided ministers and ministries in the logistics space, using the postal service to compete with private players as opposed to working together to enhance the first and last mile of the country. Private parties can bring the tech, the scale and the governance, state can bring the manpower and access to physical distribution in every city of the country. Match made in heaven, one parties precision other parties tax subsidised existence. Similarly for payments, govt needs to get out of the way, SBP is working on their own thing, National IT Board is doing its own consultations, #DigitalPakistan is allegedly also doing some thing. Also don’t forget Bill and Melinda Gates foundation is working on a Micro Payment Gateway with the SBP. When will any of this see the light of day besides consultants circle jerking each other?

Look nothing against any one, but China solves most of its ecosystem issues by having local understanding and local momentum. In our case almost every body solving for #digital #payments #logistics is a recent #Wapistani, beyond the cute hashtags there are serious consequences to this. Basic rule of thumb, Jang Akhbar parhwain and have them write a summary of what the Awaams core issues are?

Whilst Malcom Gladwell’s 10k hours of doing some thing to become an expert has been widely contested, there is some “truth” “Sadaqat” in the fact that most of these people haven’t even lived in Pakistan for 10k hours consecutively before arriving on the scene. In the end not much real Rails are being built for the consumers or for the businesses that really need those Rails- Instead some fantastic social media posts are being generated. As if some one previously left a play book behind. Oh Wait. Yes we already also had that happen:) More on that an other day.

In short, hiring two riders by every business to do localised deliveries and collecting payments wont solve any thing. Baji main larka bhaij dayta hoon cant scale either. Do you think the Chinese used some ghutka eating boys to get where they are? Ride hailing tried to scale it and now the after effects of the gig economy are also all over the place. Like Splatter marks at a bad homicide.

Most of the startups and consumer tech people only know eye balls and don’t know monetisation, Google Pay Still hasn’t turned a dime in India, Deliveroo never made any money and never intend to really get past building scale. We have to look at businesses that have true scale potential whilst being profitable, we need to help build those businesses by creating the rails that they can ride. We need to get past visions of building unicorns, we need to build stable companies that have the ability to self sustain and scale.

What we need to focus on is to find our anchor apps/products or try to have a use case that allows an app to have super app scale. Then we need to go down the path of Mini programs which are lightweight apps that run inside another app (like WeChat, Baidu or Alipay). So that consumers don’t need to download stuff through app stores and constantly look for wifi to upgrade. They make it possible for one app to perform the service of many apps. In a place where not every one has access we need to plan ahead for low friction once we have people with smart/er phones.

Sadly we don’t have any local apps with said traction but we have some that are close, only if the telco dons egos were smaller than the size of the downloads we could get some where. But an other alternate are News sites and their apps given the insane news consumption. It’s time for our #DigitalKalkars to evaluate a new cure and prescribe less of what they already know and more of what others have already done successfully(In China)

An outside-in approach would be for some one to come in, look at all the apps that drive traffic & are local, acquire and build a super app via a single update consolidating say the top 5. Similarly use other peoples digital channels with large audiences. Since whatsapp Biz APIs continue be missing in Pakistan, its time to go build our own tech and migrate our folks across by providing better value, not by danda or shutting down whatsapp locally (wink). Be it news be it any thing else, once aggregated, then work with payments and logistics players to try and take a different approach to solving for PAAS and LOT. Every things needs a platform to scale. Time to get to work, less tweets more products. Build scale and bypass the regulators, apologise later. Every one is willing to forgive some one who helps every one grow.

The New Normal | D2P(Direct to People) the ‘Only Mile’ that matters.

Every ones home and will be for the foreseeable future. Most things humans want or need to survive must find its way to them. Businesses are realising the true need for Digital First. Not applying new models to old physical only data sets. Not just for optics but for survival. Direct2People (D2P) is the digital and physical model of engagement, If you can migrate your product, your services your business to a one to one engagement + delivery channel you have won. The ones that identify, curate, capture and build on LMD(Last Mile Data) will emerge victorious. Not all have the infrastructure to own this space, but those who can, will.

The Only Mile that matters is the one that brings every thing to the end user. You have to build to capture the Data that flows in this mile to your advantage as well.

Some things that will be the new normal, in the given situation will be the emergence of C&D2Consumer (Cloud & Dark every thing to Consumer). In Pakistan it may be a first, in the region it may be an expansion route, given a host of this had already started on the Dark aspect of fulfilment. Globally not many can still do it profitably because the end economics was fuelled by VC $ and a limited path to monetisation. COVID has had a sobering affect to all that fuel. Given where fuel prices are perhaps a naturally intertwined phenomenon.

The Opportunity | Gali Ki Dukan AKA Corner Store

Dark is our friend, with social distancing and crazy queues every where, there are many ways to ride this opportunity. Instead of building at-scale dark stores and going crazy investing in the physical realm, the fastest most scalable way is to build a fulfilment co-op. Meaning “you” become the order taker, but you use an army of nation wide stores to be hyper local. Doing D2P deliveries to folks in their neighbourhoods. Since no one is coming to the store, shutter down and convert it to a small scale fulfilment center. Be the best value adder for that conversion. But before any of this, the corner stores need a smart phone and connectivity and accurate SKU information (yet an other opportunity). Content is king in most realms and before you can take orders or sell to any one, you need to have content against which to sell. This is a multi tiered opportunity, it is an opportunity for the FMCG + CPG brands to get off their rear ends and focus on delivering content, like they deliver goods via distribution to the retailer, and also act now to have a mechanism to see order flows + volume info being fed back. Many areas to solve for here, startup worthy in each piece of the value chain. From fixing manual order taking, from generationally defeatist value eroding distribution models that “with hold” cash from the market and bad payment cycles. All can be solved for by increasing the bottom line for all and increasing employment and sustainability in crisis mode. None of this will be easy. If it were easy every one would be doing it.

The Opportunity | Local Advantage

FYI, don’t wait for a Careem or a FoodPanda to come and solve for it, they are struggling to pivot in moving from ride hailing to grocery hailing to rashaan hailing to “just use our Gig economy workers/our daily wages guys who we are now calling heros”. Sadly who really aren’t full time employees so we must band together so our Mckinsey esque financial models driven by VC cash can start making sense again for the investors. That can wait. We have the established players like Imtiaz, Naheed, Chase, Jalal Sons, Al-Fatah, Utility Stores, CSD, Rainbow Cash and Carry, Carrefour , Metro and a host of others. Yet no one is organised beyond the today, beyond making hyper profits based on stretched supply and crazy demand. No one is looking to invest in core infrastructure. The likes of Carrefour opening store fronts on other E-com players sites also shows their lack of readiness and actively enabling future competition by handing over their order data, fulfilment and Last Mile Data to the Chinese, today. Talk about not learning from Amazon. That has systematically copied what its sellers were selling. A must read if you haven’t already. So whats the opportunity? Its to invert the funnel away from the market place player(s) and go towards establishing your self as the DarkStore. You already have the product(s) you just need to enable sensible order taking, a marketing push and a stellar customer experience where people dont have to line up three hours in a store. Further you have got to learn how to build subscriptions and use it to your advantage on being the offline groupon when you go negotiate with the FMCGs and others better than just todays expected demand in growth. Banks will be your friend if you can show pre-booked demand. As an example, Imtiaz has been at it since 1955 as a kiryana store, legend has it the now owner, went to Singapore in 1978 and saw the Al-Mustafa Store and successfully replicated the model. Whilst that model has clearly given them scale, its very localised and not a billion dollar scale, for example they don’t even have online ordering in any compelling format. Yet across the Pond, FB invested 4.9BN$ in JIO telecom so that they could mobilise access to Whatsapp for full-filling orders via reliance retail (JioMart) to potentially 400M Indians and bringing 30M Small stores online. I am sure there are many other things that underpin that deal, but that is the potential of having the right retail channel and systems in place today so you can exploit explosive growth from adjacent industries, like in this case from Telecom or Social Media. We are missing the boat on getting started on this journey, the time to act is now. Regionally Talabaat also got in to Dark Stores in Dec 2019 in Kuwait, arguably the population the size of Bath-Island in Karachi, but it validates the model if done right. So what is missing? In my view its strategic growth capital. To make all this work you need lots of it.

The Opportunity | Reforming of the Know-IT-All Bank & their Sponsors

Banks who have been miserably un able to digitise any thing in our fair land should work with established players(those who have 1 set of books) or get into funding those, who can convert/build out dark stores using existing infra and take a bet on them. There is only so much asset backed lending you can do. Need to move away from real estate to retail fulfilment and fund the future. What are Banks doing as we speak? They are making a pretty penny on taking free money from SBP and forwarding it as payday-loans to SAITHS, (Super Ancient Incoherent Totally Haemorrhaging Second-generation) businesses who do not have resilience and want government handouts and also don’t have the moral courage to pay it fwd into the businesses that made them wealthy in the first place. Interestingly enough, just looking at some basic of Bank Shareholding, we should have had at-least a few rising to the occasion given their trading/wholesale roots and familiarity. But this also tells a sad tale of how control is exercised under the guise of open market economics yet a few groups/families/Saiths, as is universally true also, control the destiny of Pakistani businesses quite incestually. But there is hope some may actually turn out to be more progressive than their founding fathers and go beyond the rent-seeking industrial complex. Our challenge is our opportunity. Some already operate in organised wholesale locally and internationally, yet have done nothing to inspire confidence locally. Thus for those who have capital, what a time to make a true opportunistic move and make a killing, because these banks aren’t setting up venture funds any time soon or promoting things they don’t know. They have been talking about it, but zero execution. Sadly the pretend VCs in the organised sectors as bad as the Banks because they havent been able to figure this out either. Most are hired help/front for other peoples money/other saiths, aid groups and families.

The Challenge | Lack of Real Expertise, Talent & Desire to Change

We continue to lament as a nation of what could have been had x happened or y happened, time to move past that. We need to try doing things because COVID has happened and like it or not, there will be mass lay offs. Our bread and butter industries like textiles in the export sector may see net growth, post people looking for non-china origin global supply chains, but in the short term a lot of damage has already been done. We need to up-skill an entire generation and scale up a host of existing businesses technically, or create new models that are digitally supported and build on a remote working/dis-aggregated DNA. The poster child employers of the yesteryears that solely relied on 1000s of helping hands and dirt cheap labor have a new reality about to hit them. We need to have massive dis-intermediation that needs to happen from Agriculture, Real Estate, State-Owned Infra and Sitara Power. So that new models can be tested rapidly and built out. The Challenge will be to convince those who have access to capital + those who have access to data + those who have access to logistics infrastructure to come together in a meaningful way, all under-pinned by world class technology driving the commerce + trade in the D2P space.

The Reality | Don’t Let a Dark situation Cloud your judgement

Take the example of restaurants, from the corner dhaba that feeds its locality to the ones in the urban and sub-urban areas of the country. Are all closed, the real estate going to waste, all the traditional ABL(Asset Back Lending) has come to its knees if no one can use the asset or make it productive. What will happen when the banks/foreclose on say a restaurant that had leveraged its real estate, well it cant be put to use any time soon as no ones coming out for the foreseeable future. So what good is a paper weight asset to the bank any way? Enter cloud kitchens, maybe start aggregating all the loans you have to restaurants and get them to work together to retain their brands and Launch A Cloud Kitchen. Similarly all the industrial/commercial real estate that will become available can be used to retrofit to get in to the dark store model nation wide. Some one has to start having these conversations to preserve value for the Banks Shareholders and to give a non aid economic injection to the country. Due to a lack of talent , skills and expertise we traditionally keep on going back to the same. This time around though the reality is different, a lot of mergers will happen for those who have cash to fuel them, a lot of banks will loose their shirts and aggregation of banks is eminent also. Telcos need to figure out how they will participate in this NEVC(New Economic Value Chain) Local Heros are already emerging, they need help with scale. Some one must evaluate how they will lend a hand to the explosive growth that will come in new segments especially in the D2P. This new economy will also need Dark Warehousing, not controlled by Pathan Loan Sharks Masquerading as Private equity.

Don’t Wait For | Digital Pakistan to happen, instead make it happen

Whilst the DigitalPakistan initiative has its heart in the right place, there is too much chaos in the bureaucracy and too many vested interest for it to really have any short term strategic impact and any long term policy shift to help digital businesses be any better off.

1. Bureaucracy doesn’t let things move
2. Lack of Implementers and directionality for DigitalPakistan.
3. There is more focus on pleasing the powers be & getting visibility than on work
4. Sharing re-purposing India + Vietnam Google decks will only fool so many people so many times

So how do we over come this, coupled with a really poor business environment? We must stop kidding our selves and raise issues to the Razak Dawoods and Hafiz Shaikhs of the world, point them in the direction of structural changes that are necessary vs the mafioso lobbies that are busy getting exemptions and handouts. I don’t think our appointed custodians have accounted for the lack of trust in the system by founders and regulatory systems in both directions that will contribute to the slowing down now and in the post COVID Pakistan. How can a system prosper where people are spending more time in compliances than innovating and growth? These authorities abound in the name of Tax, SECP, SBP, EOBI, PRA , SRB and the list goes on and on. DigitalPakistan should focus on helping businesses go Digital By removing the menace of incompetence or corruption or both when dealing with the sate by bringing transparency, or a new body to regulate digital business and its controls and taxation. People have traditionally loved for govt to do and be in every thing, because people want more and more subsidises, govt schemes in the name of development. They want everything : education, health, employment, communication, infra, defense, security from govt. The result is increase in the number of ministries and a bureaucracy bursting at the seams and no net new innovation. Digital must mean that these traditional shackles are removed and that the those who have been appointed to help get visibility to start helping. Currently the old lobby and mafia has all the headspace and air time of RD and HS. Shout out, raise your voice, collectively be heard to drive change. If you keep quiet, DigitalPakistan wont make a bot to verbalise your internal feelings and flag it as important and send to the power be. The channel you have that your parents didn’t is digital, with a government that largely keeps score online now is the time to bring the fight to them online, esp since you are sitting at home thinking if you will have a job in 2 months.

Some Missing Ingredients | Life Ka Operating System

Whats to come? Micro-mobility, payments, grocery, public transit and inter-intra city with social distancing factored in for all the above. Except it’s an expensive and most days a difficult cake to bake yourself. How this is packaged, super app or not, is any ones guess, is it needed? For sure.

Does it need some serious infrastructure plays to be enabled.

Who will do it?
At some point in time external consolidation Capital. Till then any one who can put the most pieces together will win. Don’t forget, in the D2P space the biggest thing that will drive change and growth will be payments. For all the Dark Stores, Cloud Kitchens, Last Mile Data and Analytics, if people cant transact, the scale will for ever be linked to access to paper money.

So whats a basic guide to try and build & execute this?

1)Let small merchants like shopkeepers, street food vendors, tea sellers etc. accept payments on any SBP/Approved/Linked National Payment Gateway app like without needing to download those apps (so that they can also participate in your Dark Stores/Cloud Kitchens)

2)Build, borrow, copy or steal a mechanism to bring trust. One way to do it is to ask merchants for their mobile number and CNIC to generate a VPI (virtual payment Identifier) on behalf of the merchant and encoding that in the QR code (whilst documenting every one and creating trust)

3)Provide merchants an app to track their transactions. Again, nothing really novel here. But it has to be frictionless, audio or less than smart phone enabled also.

4)Deploy and use other peoples agent networks, co-monetize them to reduce your CAC so that as every ones home but wants services they can digitally engage and pay at some level. This is the toughest part, it sucks to manage remote/large field agent work forces in Pakistan. COVID wont make it easier but it may allow for attitudes to change when there aren’t enough jobs to go around. Be ready to harvest other peoples workforce.

5)Merchants do not pay transaction fees with CASH so fee-based business models will never be viable in Pakistan. So how does one plan on making money? Lending, of course . Take a page from AntFinancial which they have yet to make work in Pakistan.

6)How this works is, making small ticket loans to merchants underwritten by your transaction data delivered through directly via offers in the app. Also have plans to sell insurance, invoice discounting and other services down the line. What this gives you is a tax/revenue treasure trove and drives every one to documentation over time.

7)Since traceability is going to be such a big thing and already beginning to be large, there is both profit and karma in making this data searchable, it can only be searchable when it moves to cashless.

8)Given FB isn’t coming to PK any time soon nor is whatsapp opening its API for payments or order-taking, Googles NBU being powered by Indian hegemony, think of the next best thing, use this time when people are home to drive them to an alternate mode of communication. TV Advertising is your friend, every ones home. Learn from VEONS class act of a blunder on how not to do a super app.

9) Im not for govt or sitara intervention but perhaps use this down time for some colossal shift in messaging. For example the less than known G42 in Abu Dhabi that seems like an AI Power house is a thinly veiled psyop funded by petro dollars that controls ToTok has some examples for those willing to put national interest ahead of every thing else and learn some new tricks besides how to increase the value of a plot in 24.8043° N, 67.0577° E.

10) Invest in Tech. But remember Tech McKinsey

Theres a lot to be done, some sequential some parallel, but to do any of it, a strategic game plan is needed. There are many missing pieces, therein lies the opportunity. Whats your D2P Strategy? Do you even have one?

“Hope is not a strategy.” Vince Lombardi

COVID | Can Our Valued(banking) Institutions Deliver a SuperApp

TL;DR Small Banks are done, unless they take seriously bold steps, Big Banks are done if they don’t burry their legacy issues and upgrade their boards. Software comes much later.

Who would have thought COVID would actually be a delivery mechanism to force this nation and many others to adopt Digital Payments & beyond. Till last week there were some payments that even I had relied on a trusty check to do (like card payments) etc for the sake of paper-trails/end of year tax man reviews/audit requirements, given that any one who pays taxes in this fair land is the most likely to statistically also get f**d by FBR (F**d by Registering).

Best taken up an other time, given that right now Sugar Mafias also need forensic info and PM intervention but salaried/SME class individuals in the tech and connected sectors who continue to earn USD for the exchequer get nominated to form the basses of more tax burdens and harassment. Whilst Agri Mafias in the organised sector operate as organised crime, the average person continues to be strong armed by the government. But there are ways to go about all this, un-surprisingly if (a) Bank or Bank(s) Got their Act together it would get easier for governance and accountability.

Keeping all the above in perspective, technically a Bank or Bank(s) are genuinely suited to completely rise to the occasion and own multiple legs of Payments, E-commerce, Logistics, Peer to Peer Settlements, ContactlessPayments, National Verification of Resource Distribution, Taxation, and a host of other Last Mile Data Plays(LMDPs) by building a Super App by either a connected ecosystem or an owned/invested ecosystem.

But before building a Super App they, have to do some thing less remarkable, build super common sense. Evaluate the hand that this tragedy of sorts has resulted in. Interest rates will continue to go down, traditional business will suffer, G2C will be on the rise, P2P will also continue to rise, traditional avenues of earning gang buster revenues will also subside, lay-offs are eminent. Every ones plotting the curve lines of infection but no one is assessing in our local scenario, the enablers that need to ensure we get out of this with a fighting chance.

P2P daily wagers/ala ride hailing is nearly dead, or will eventually die unless it “pivots” to using its network effect to do some thing else. Asking the govt for a hand out is not the best way forward. So where does a Bank fit in to all of this? Let’s evaluate (some of ) the many constructs of this connectivity pie.

Banks already know who is on the ATL (Active Tax Payer List). Larger Banks with branches have distribution channels already, this will help with cash-in cash out. Banks need to adopt the Easy Pasia / Jazz cash model, go to any bank branch be able to send money to any one nation wide, hassle free with one person at the Teller with a Smart phone without predatory pricing (See pricing for Telenor here and Jazz Here) for the common man and incentives built in for him/her to be driven to savings or to use the Banks Super App for other incentives in his/her life.

Same said employee or other bank employees can be incentivised to be the Cash-in agents by night fall when Bank Branches are closed. There is a reason the under 5k Bank Branches cant compete with the 100k Easy Paisa type locations just yet. This needs a dramatic shift in thinking, partnering and building networks. Easiest is to sign up who ever is open 24/7. Petrol pumps being the missed opportunities and thousands of Pharmacies and Hospitals etc. Many other examples. Par agar sab bata doon to Bank Kay CEO ko kis bath kay paisay miltay hain? If you are the Ceo of a Bank and your ego allows you can always email/call for a quick chat, most likely i’ll learn some thing new out of it.

Banks have the regulatory sensibility to manage the additional transactions and report on them and evaluate them and review them whilst also building a treasure trove away from Easy Paisa and Jazz. In one clean sweep also taking out the aspirational Fin-techs who are either awaiting their licenses or who continue to play in the SandBox and given the uncertainty around lock downs will likely die under the weight of their payroll before ever having tested their use cases.

Whilst not ideal for the startups in some ways, but the very idea if they get acquired for the pre-built tech that the Banks cant build, Banks who are so conservative by nature and fearful of the regulator at large, will actually benefit by that fear, so long as the have a CEO who can take the lead in using available capital on not deploying loans alone but by thinking like an agile startup(i know cliche) but use the muscle of the 800 pound gorilla that the Bank is.

Banks also already have a deadly weapon, security and trust based call centers. Make a note, who ever owns and get the call center space right, will succeed like a Gangster(Read Banker). So what is the winning formula? Super app can come later, when you can get your developers and fancy CIOs and UX people in a room, but before all that you need to get your head out of your rear end and start making notes about

  1. Scale (Infra/People/Branch Tech/Hardware)
  2. Security (ensuring Bank CEOs passwords arent discussed at airport lounges by the CIOS.)
  3. Ensuring SBP to allow using cloud infra or solving the aws/gcp issues
  4. Have a board that has people in their 30s and 40s to help guide you on what a super app is or means. (You having your 20 something year old PA Ship EarPods to your Hotel in Dubai does not make you an e-com or super-app expert)

There is a very clear reason why Pakistani Banks typically lag behind the curve. Because our current breed of Bankers mostly have been trained at Citi Bank 20 yrs ago, when there was no Digital etc, what they have successively stolen or emulated from Citi are Product programs & Risk Policies amongst other stuff. If Citi ain’t done it, they ain’t doing it(by and large) .

They don’t have the capacity to figure this out as they continue to vie for Inter-Pakistan banking one-upmanship CEO roles. In the end if your ambition is to have the larger Merc and the bigger house, you cant solve for any thing else. But truth be told, it cant be easy being the CEO of a Large Bank, it has tremendous regulatory pressures and massive political under currents and now the ask/demand to innovate. 30 yrs ago when these CEOs started they likely didn’t sign up for this new evolved role.

The professional environment is to blame equally, as is the ownership of Large Banks. One Bank owned by grocery/ala retail lineage is heard discussing optimal use of janitorial staff being shared between branches and other one with Institutional Holding akin to the Vatican has been trying to do payments and retailer signups for 2 years. It is not easy at all to be in their space. That is for sure, the momentum of the legacy they have inherited continues to weigh them down. Most certainly due to really really shitty board composition, lack of women, lack of younger people, lack of tech savvy people, lack of people who actually interact at the Branch level. SBP Should mandate a customer advocate to be part of a Bank Board Committee to really discuss the plight of the end users.

Moving along, banks use their own capital to invest into tech companies, invest into ride hailing/bike hailing convert their staff/merge the Apps, build an ecosystem, tie into logistics and by virtue become the clearing house of invoices, thus verifying input taxes on both ends of the transactions and slowly documenting the economy. Who would have thought, take it one level further, tie up with POS vendors nation wide, starting with KLI retail, at check out, print a QR receipt that also passes back, beyond payment info retail purchase data, Now the bank can plot for a bigger land grab of data and informed decisions.

From seamless goods and services payments to taxation to credit scores, to effective loans to knowing where goods and services are in the country(distribution/logistics/warehousing) to where they need to go and by having credit profiles on customers in real time, make real time decisions to do bullet financing and institutional items by connecting all the supply side(input data) to demand side(payments data) and sitting between the two to become the largest clearing house of information and data.

All this is in addition to taking a large chunk in a Bykea/Others Locally, building capital to build grocery co-ops, a utility store but private, so you get volume leverages, mixing logistics capacity and shipping by partnerships or investments to know the flow of (commercial/retail) goods in transit to be able to develop a map of Flow of Financing (Needed) In Transit. All this starts from a vision and not a big one either.

Masoom Bykea is asking for Govt support, they are doing right by their riders and daily wagers 100%, but they should be talking to Banks to build a super app by being one Leg in the journey. Last mile will only win you KLI even in the post COVID world, first mile will win you the rest, Chose your partners wisely, stop hiring the refried bean equivalent of easy paisa castaways into your banks.

sitāroñ se aage jahāñ aur bhī haiñ
abhī ishq ke imtihāñ aur bhī haiñ

None of this can or will happen over night, it starts when the banks stop circle jerking on fire side chats and the CEOs disaggregating the innovation and fund piece of the Digital journey into a separate investment and strategy arm. Look, we all know branch staff lay offs are coming 3 months from today, best to allocate freed up capital to hire the right people so momentum and jobs can be created at the same time with a great big data play on the back of it.

Right now even after the post NYC cluster , HBL is very decently poised to harvest this COVID opportunity, similarly Al-Falah, given their sponsors at home(Abu Dhabi) also have a bleak economic outlook, at-least in PK they have 200M consumer possibilities, with their airlines, banks, construction collapsing, those sponsors must be saying a silent prayer on getting Pakistan right;by virtue of staying true to the Bank even after being (taken advantage off) in the past

Both Banks have great stewards at play, depends who is willing to take bigger bolder bets and is less pussy footed in front of their boards and owners. UBL could have been, but sadly doesn’t look like it, unless there are changes eminent which we dont know about. Rest frankly are under whelming in the large bank space.

The traditionalist in you will say, “oh but none of the above is the Banks job”, but neither was advertising or news papers, Googles, but here we are. Similarly heres a glimpse of what is to come in the crisis mode the govt is in.

With a population of approximately 220 million and an average household size of 6.8, there are approximately 32 million households in the country. An income support instrument that seeks to benefit 12 million households (more than a third of all households in the country), is bold, ambitious
and transformational, just in its sheer scale.

  • First, 4.5 million households are already part of the Kafalat programme. This is the original base of the BISP programme, that are part of the National Socioeconomic Registry (NSER) and qualify for the monthly PKR 2,000 grant.
  • Second, 4.0 million new households will be added to the original Kafalat list, by relaxing the selection criteria and including more households from the NSER. This is a remarkable single time relaxation, as it will add more than 10% of all Pakistani households in a single stroke.
  • Thirdly 3.5 million new households will be added to the EEC list of grantees, through an open call for applications using SMS and verifying credentials against the NSER itself, and additional criteria for selection.

What does any of the above means? It means there exists an opportunity to developing proxy economic profiles for the new and existing applicants through the use of data. The four telecom operators have detailed level transactional data of 165 million registered cellular subscribers.

This data comprises of a range of network and usage characteristics like phone models, last changed IMEI, geographic movement, base station records etc etc. Like the Govt created the USF, they need to Mandate all the telcos to make this data available (with controls) to Nadara who can feed it to Banks and others for nation building. As the consumers data belongs to the consumer and to the sate as the custodian of its people. In times like these, this data monopoly should be broken so that citizen services can be developed for the long term. Still not having a NADRA Consumer API hurts, so even that must change. Also ANT aka. TMB has been sitting on every thing post acquisition, nothing has happened, if any thing Telenors APIs and service aggregation has taken a toll.

For the Banks and other business this is a time to self reflect and think through as well. My good friend and African/Global Venture Guru + Jollof Curator Victor Asemota Said it best.

We havent forgotten the Agri Mafia, or the opportunity a Super App or a bunch of connected APS/Ecosystems can do for the Agriculture supply chain. Granted Banks cant do every thing but they can deploy their cash to the startups that are on the cusp of solving for these issues.

Instead of micro finance Banks like Finca doing 50-70% markups(I could be wrong but my assumption stands in that range) and others not doing better than 27-38% markups to the poorest of the poor, will never dis-intermediate the ARTI whose loans cost the Hari is 12-14% markup in addition to the opaque value skimming he does. Namely from

  1. Providing loan to the kissan knowing his local halaat (Death in the family, medical emergency, shadi biya- floating markup)
  2. Making him(kissan) buy in to his(artis) seeds(which he gets a 12% margin from source)
  3. Pledge future stock without price information to the loss of the Hari
  4. Be his only source of market access
  5. Transportation line losses passed back to the Kissan so massive theft to the poor grower in weighing

Side note: The morons buying cricket teams from screwing over farmers or enabling the above highway robbery, on the industrialised farming side should totally say a prayer for them selves; because of the poverty they have unleashed to the masses.

So the Super app opportunity goes down the value chain and across the country, Super App may also be mis leading as it needs to be a set of connected services with one interface, i.e the Bank. Could be through call centers, an app, a web site or my fav distribution channel the 3000 PKR feature phone with data built on KaiOs.

Lots for the Banks to evaluate if they come out of their ivory towers and their foreign destination board meetings, the opportunity in Pakistan is as great as it will ever be but also the most challenging it has ever been. The time is to take tough decisions and lead from the front vs sucking up to the board. Time for the best Banking CEO to rise from within.