Musings of an Entrepreneur

                                                 

While 2006 was a year of transition with the break after Zingy and the creation of OLX, 2007 was a year of consolidation. I put my disagreement with the acquirer of Zingy behind me. I made two new Internet investments. OLX continued to grow slowly but surely – we now have over 80 employees and are present in 40 countries in 12 languages.

I continued to travel far and wide for OLX and hope that there will be less business travel in 2008. On the personal side, my life has been more boring, though I did manage to go heli-skiing in British Columbia, kite boarding in Cabarete (Dominican Republic) and hiking, biking and rafting in Costa Rica. I am also continuing to (very slowly) work on my tennis game, open mindedness, patience and humility.

The best books I read in 2007:

• The Black Swan by Massim Nicholas Taleb
• The Undercover Economist by Tim Hartford

My best blog posts in 2007 were:

• Passion and love at the end of the age of innocence
• “Loving” versus “Being in Love”
• Happiness and the dangers of belief in the written word :)
• The Theory of Social Obligation
• The nature of entrepreneurship: randomness, trial and error, and how intelligence can get in the way
• Ethics, spirituality and religion: a debate on torture
• Fear and uncertainty in the time of prosperity
• Capitalism and Democracy
• Macro Perspectives on Global Liquidity: How Chinese Farmers and Oil Sheiks are Subsidizing American Consumption and its Implications
• A Different Perspective on the Global Economy
• Facebook: the next Google?

I predict 2008 will be a year of slow growth:

• It will continue to be too early to tell whether OLX will be a success or not – given the non viral nature of online classifieds, this project is going to take years.
• Two of my Internet investments will enter the Alexa top 50 – one is Badongo.com, the other I will talk about when the investment officially closes in January 2008.
• One of my investments is likely to fail.

I have not yet decided whether I will be foolhardy enough to make predictions on the global economy and the US election. Stay tuned :)

Happy New Year!

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As I wrote in a recent article (Capitalism and Democracy), despite decreases in global inequality because of economic growth in South East Asia, in-country income inequality has been rising. However, this analysis of inequality is misleading as income inequality is less relevant to well being than real consumption inequality.

Interestingly, inequality in life satisfaction has been shrinking in OECD countries suggesting that the quality of life across the income scale is becoming more similar. Inequality has narrowed dramatically in height, life expectancy and leisure. As William Robert Fogel, a Nobel Prize winning economist put it: “In every measure that we have bearing on the standard of living … the gains of the lower classes have been far greater than those experienced by the population as a whole.

Differences in material goods have also declined dramatically. For instance, despite huge differences in prices for various types of cars, air travel or refrigerators, the difference in the actual services rendered is rather small – and nothing relative to the difference between having the good or service and not having it. Today 70% of Americans below the poverty line have at least one car!

Over time the consumption pattern of the less fortunate has become very similar to that of the wealthy. This compression is the predictable result of innovation in production and distribution that push new technologies down the price scale incredibly fast.

As entrepreneurs we sometimes make vast fortunes and widen the income gap but in so doing, we produce ever higher quality goods at ever lower prices reducing inequality where it matters most!

In other words, income inequality no longer matters!

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Check out this parody of the writer’s strike, it’s hilarious:
http://www.newsgroper.com/jayson-blair/2007/12/19/entrepreneurs-strike-term-sheet-negotiations-break-national-venture-capital-association/

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If you want to find out more about we have been up to, you can read the interview at:
http://puchoo.wordpress.com/2007/12/19/interview-with-fabrice-grinda-co-ceo-olx-inc/

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The movie is good, not great. It’s extremely well done and acted. However, given that it’s directed by Ridley Scott (Alien, Blade Runner, Gladiator, Black Hawk Down), I expected to be completely wowed – by maybe I am holding him to impossible standards. I should not complain too much: I was thoroughly entertained.

Despite opening with a bang – the movie has to establish Denzel Washington as a bad guy – the beginning is slow and long. I would have cut most of Russell Crowe’s back story with his wife – the character is so clear cut that the nuances don’t seem to add much. However, somehow the movie grows on you and you start caring about the characters. By the end, the pace has dramatically quickened and you can’t wait to see what happens next! I definitely recommend seeing the movie.

As a brief non sequitur: it’s one of the few movies where the two nemesis share almost no screen time together. In fact for most of the movie, they don’t know of the existence of the other. While the concept of two enemies never jousting in person would seem counter intuitive, it was extremely well done and effective!

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“I have stressed the fact that the beloved person is a substitute for the ideal ego. Two people who love each other are interchanging their ego ideals. That they love each other means they love the ideal of themselves in the other one. There would be no love on earth if this phantom were not there. We fall in love because we cannot attain the image that is our better self and the best of our self. From this concept it is obvious that love itself is only possible on a certain cultural level or after a certain phase in the development of the personality has been reached. The creation of an ego ideal itself marks human progress. When people are entirely satisfied with their actual selves, love is impossible. The transfer of the ego ideal to a person is the most characteristic trait of love.” – Theodor Reik “Of love and lust”

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