An Intellectual Orgasm

Term 3 introduced many of us here to the world of Corporate Finance. Although I had heard of some of this jargon before, I was never aware of a discipline called Corporate Finance. A major aspect of teaching is the way a subject matter is delivered. Although many of my batchmates with a financial background will disagree with me, Prof.Bhagwan Chowdhry, UCLA, exposed us to CFIN in a truly unparalleled style. While he had to skim over a few really deep topics, I got to understand that the subject was really profound. While I'm not going to delve into all topics that he taught, I want to record some of the wittiest moments in my blog. Some call his jokes playboy stuff but everyone surely enjoyed his wit in class.

On the adverse selection problem...To a girl in my class(TL), Do you agree that guys at ISB range from sleazeballs to nice guys. She said yes. So on an average guys at ISB are jerks. She said yes again. So 'coz you consider the average guy to be a jerk, you don't get the guys above the average jerk(the nice ones) and you are stuck with the sleazeballs. She couldn't do anything but nod in approval.

On Arbitrage opportunity, Situation in a party. You are a guy, like many around, who has never had any luck with women. And all of a sudden, a beautiful young lady walks up to you and says, "Mein tumhare bachey ki ma banna chahti hoon - I wanna become the mother of your child". Can you believe it?...The catch is there is no free lunch.

On private valuation, I'm reading a book and my wife calls me to do the dishes. I ask her if she knows my billing rate. But she says that I'm just reading a book and not consulting right now. But the reason I'm reading the book is because I value the book more than consulting. But I still ended up doing the dishes 'coz she threatened no sex tonight.

Talking about benefits of going public he says, Human beings fornicate and read newspapers.

And talking about the costs of going public, Good or bad somebody will sue you

On signaling, he said something to this effect, I have my head tonsured to signal that I'm macho :-)

On underpricing in an IPO, The common investor gets too many lemons and too few peaches. Underpricing is the sweetener

On VCs, Venture capitalists are like your father-in-law

Finally his advice to us, Even though I look very young, I'm actually old enough to give advice :-). Use the GEO principle to decide who to work for or who to recruit. GEO is Generous, enthusiastic and optimistic.

This guy is truly a gem. Given a chance I would do CFIN again from the start and I think most of my classmates will agree too.

Term 3 done - 37.5% MBA

A little over four months ago 422 young and old kids enrolled into this cute and fancy little program. They were all dreamy eyed, energetic and were ready to conquer the world. Today the dreamy eyes have given place to eyes that long for sleep, the energy levels are barely enough to withstand the battles at the testing arena. But one thing, they all still want to conquer the world. And they all took one more step closer towards this goal. At the end of another term of wizening, they are heaving a big sigh of relief, because as per past survivors the worst is now behind them. This term, of course, was the hardener 'coz they learnt some real serious stuff like Corporate Finance, Operations Management, Managerial Accounting and Entrepreneurship. As usual the learnings were immense but they were also daunted by the biggest roadblock in life called time. The day unfortunately had only 24 hours and the body would not always co-operate. But still they trudged along. Some managed to sprint in some phases and helped the others come up and some others did it when these guys stuttered. Everyone had some fun, some enlightenment, some realizations and some reassurances thrown in at them. And guess what they all managed to survive once more.

As much as they are all looking for the real challenges like ELPs, PAEV's and international placements, which are round the corner, they all are looking forward to this 5 day break. Cheers once again !

From War zone

Two weeks and no post. These two weeks have possibly been the most hectic period at ISB so far. I have averaged 4-5 hrs sleep everyday due to the innumerable assignments and case studies that were pending. Tomorrow is once again exam time. Feeling much more relaxed compared to earlier terms even though I still have a long way to go tonight. One major update is me and KS have finally managed to launch a new social club called 'Vistas and August house' club. We are primarily focussed at literary events, soft-skills workshops and epicurean pursuits. In two days I'll be home in Chennai and I get 5 full days off. Yahoo!
International placements start next term and I donno which companies I want to apply to. Hopefully the economy stays up for one more year of rocking placements.

Jeffrey Sachs on India

6:30 PM, August 8th, 2007: The Indian School of Business played host to the greatest economist of this generation, Mr. Jeffrey Sachs, Director, Earth Institute, Columbia University. Jeffrey needs no introduction to the ISB students. Prof. Krishnakumar from Rand Corporation taught us Global Economics in term 2 and he extensively used videos featuring Jeffrey solving hyper-inflation and extreme poverty in third world countries. After a raunching introduction by Rajat Gupta, Jeffrey walked up the stage to talk about 'Climate change and Sustained development in India'. He started out talking about the three major phases of economic development in India since independence, the 1947 to mid 1960s perios when essential PSUs were set up, the mid 1960s to 1980s when Green Revolution and infrastructure development happened and finally the 1990s onwards opening up of the economy and the rapid growth. Prof. Sachs feels that any country has to do two three things(in that order) to achieve sustainable growth.

i) End extreme poverty
ii) Achieve rapid growth
iii) Create a framework for sustained growth

And all of these have to be done consistent with our environment. Sadly, India has achieved the second step, achieving rapid growth, but has failed very badly on the first and third step. The high incidence of stunted growth in children(malnutrition), maternal and infant mortality is proof for that. In spite of great advances in the technology & infrastructure sectors the spending on primary health is among the least in the word (Some thing like $10 per head compared to $3000 in US). To add to this India is a coal based energy producer which contributes to a lot of carbon addition, a major greenhouse gas. The need of the day is to have public-private partnerships to uplift the poorest of poor in India and improve the primary health care system. he particularly lauded the efforts of the Satyam group which was setting up mobile public health clinics using a public-private partnership model. Prof. Sachs likes the fact that anything if decided happens very fast in India and he wants our country to target achieving this by 2015. After conquering this major challenge starts the gargantuan task of achieving sustained growth in an environmentally friendly way. He strongly encouraged carbon sequestering and use of nuclear and solar energy to a greater extent. Then followed audience questions. He stunned everybody with his knowledege about India. I felt that he was not just an economist. He is a technologist, environmental activist, public planner and visionary all packed into one wiry body. It was indeed a privilege to listen to such a great legend from such close quarters. Three cheers to ISB.

The happening place

This is an incredible week at ISB in terms of what hogs the calendar. On Monday we had Prof. Raghuram Rajan(Ex IMF chief economist) address the students on 'Liquidity Glut' (It is a different story that a good part of the advanced finance talk went over my head). Today we have Prof. Jeffrey Sachs talking to us on 'Climate change and sustainable development in India'. We are all so looking forward to litsen to Jeff talk in person, after seeing him in so many videos in the "Global economics" series. Tomorrow we have the chairman of the ISB board, Rajat Gupta having an interactive with the students. And once again every student wants to see the man who conceptualized ISB. To keep things in perspective we also have the mid-terms on friday :-). As if this was not enough a group of us had a one to one with our dean, Prof. Rammohan Rao. Had a really free flowing 1 hr of discussion with him and in the process got to know from him that ISB will be in the FT world rankings to be released in Jan/Feb 2008. Man this is really a happening place.

Turning 60

Its hardly a week away. Yes come August 15th, it is going to be 60 years of free India. It is a day to commemorate our victory over colonial forces, to pay our respect to the sacrifices of the millions of freedom fighters and the thousands of soldiers who fight to safeguard independent India. At ISB we are going to have one of the major events of the Net Impact Club called ‘Bandhan’ - an event for the underprivileged kids of 5-15 years age group from 6 NGO run schools of Hyderabad. In association with Sports Club, Arts and Creativity Club, SFA Club and the Dramatics Club several recreational and creative events on this occasion will be held to make it a memorable day for these kids. The club is short on funds but students are contributing generously(in spite of shrinking wallets) to make this event a success. Yesterday the Spouses and Family Association(SFA) organized an event called Drizzle and put up fun-stalls and food joints to raise money. It was good entertainment and hopefully a good amount of money was collected.

Just doing a simple calculation. If each of the 422 students contribute Rs.25 per month we can collect Rs.10,550 per month. But how to go about doing that? Direct debit can be one option but not all students have a direct debit account. If we had a mandatory smart card system we could have implemented a keep the change system to collect trickles of change. Blokes, if you can think of some interesting ideas to raise funds in a campus type environment please do let me know. Talking about student fundraising this funny video captures elements of bad fundraising by students. Enjoy !



BTW news is out and my last assignment at work has turned out to be a success( see deal) and an official press release came out a couple of days ago. So its time to feel proud :-) !

Whats happening

A tumultuous week and a half it has been, since the term break started. India barely escaped with a draw in the first test. Dr.Hanif's case reached a crescendo but finally he has been released and is flying back home. The Tatas are leading in the race to buy Jaguar. Danone and Wipro are trying to buy Bisleri. The sensex is experiencing major corrections. Prathiba Patil has been elected to become India's next president. Looks like Najma Heptulla will make it two women at the top and the Harry Potter series had yet another round of success with both the book and movie doing really well so far.
And things have not remained so far behind at ISB. Two leadership development sessions, one on people skills and another on presentation skills happened and Term-3 kicked off last Monday with loads of pre-reads and an assignment to complete before the day-break on day 1 of the term. Prof. Bhagwan Chowdhry from UCLA is teaching Corporate Finance for us and his classes are really awesome. Prof. Atul Nerkar teaches the Entrepreneurship course and has really charmed the whole batch. The very first class included a case analysis of a worldwide private equity venture and our section debated the case in and out with Atul. When we had 15 minutes left finally, Atul introduces Jay Dehejia, one of the partners in the venture and one who we read about in the case. The whole class roared into a thunderous applause and we were all spellbound to see a person from the case come up and talk to us. Even though most of term-2 results are out and assignments & AIKYA(A hyderbadi family is adopting my study group) beckon ISB students this weekend, we didn't forget to party. I'm just back after the 'Pirates' party and it was sheer fun. The enthusiasm was electric and the booze was really free flowing.

Term 2 Done - 25% MBA

Time for the next term completion post. After five weeks of great learning and a bizzare two days of exams term 2 has finally come to an end. This break I'm staying back in campus. This will certainly help me catch some breath before we get into one more term of berserk activity. The major highlights of this term were MARKSTRAT(the marketing simulation game), macroeconomics and decision modeling. Ziv Katalan's flamboyance, Jagmohan Raju's wit, Krishnakumar's dedication, Milind Sohoni's passion and Harbir Singh's lethal execution will remain etched in mind for a very long time. Except for the finals which I hated once again the learning was immense. Got two good friends, CD and SP in this term and we three with AB are going to be doing a marketing strategy assignment with a large Indian corporate over the next few terms. So alls well that ends well and successfully the class of 2008 becomes 25% MBA.



Pic: A popular one around the campus on the Decision modeling course. The subject is my personal favorite but I still loved this strip.

At wits end

Term 2 is drawing to a close very soon and looking back at the last two terms I can see that there has been so much of an evolution in the student community. When we all first met a couple of months ago there was an all pervasive spirit of developing our knowledge repository and only pursuits that helped add knowledge seemed to be the right thing to do. But after three months of roasting, asses are on fire and pursuits and perspectives have generally gone for a toss. There is so much of cramming happening everywhere and quite a lot of this makes me feel totally uncomfortable. I'm so out of the stage where I will try to eat something that I dont like 'coz it is socially acceptable to eat that particular something. The 1 year MBA is certainly an experience that tries and tests your psyche, patience, wit's end and hopefully I will end up with better perspectives. News is out that, amidst this mad pressure, two of my batchmates traveled to SPJain this weekend and won two case analysis contests hands down. These ISBians certainly have their perspectives right. On a side note I have succesfully bid for a whacky exchange program to an exotic mediterranean b-school and if alls well I'll finish my MBA with supposedly the most intelligent race on earth.

Dipak Jain on campus

The really great are the one's who can have a light head in spite of great achievements. Today I found that Dipak Jain(Dean of the Kellogg School of Management) is one of that kind and not just that. He is the first Indian to become the dean of a top US B-school and is a truly inspirational speaker. His address to the ISB student body was titled "Global Macro trends" and he touched upon a few major trends

i) Demographics - The western world is aging. The number of centurions in Japan is increasing every year. The proportion of old people in western countries is going to increase dramatically over the coming years. In this context India has a unique advantage 'coz we have 70% of the population less than 30 years of age. This effect is totally gonna polarize the world with the majority of the workforce from India. Prof. Jain calls it the 'Browing of the global workforce'

ii) Hypercompetition - The next trend Prof. Jain emphasized is the way competition is looked at. According to him the competition to the airline industry is not essentially between airlines. Rather it is video conferencing. Bulk of the air travel is business travel and if video conferencing reaches a certain level business travel will reduce as much as 80%. So the strategic angle for airline industry has to be perceived in a totally different way.

iii) Innovation - While we learn a lot about first mover advantage and market share and how great it is to have these advantages Prof. Jain talked about how Google enters after Yahoo/Microsoft and captures everything. The way the company innovated was the key. The customers of Google are not really the people who use the search engine. It is rather the website that receives the click. Google realized the fact and this innovation was the key to it's success. He notes several Indian students in a Mexican business school trying to learn Spanish(with a Mexican accent). They are all going back to India to set up BPOs to cater to the burgeoning spanish speaking American population(mostly migrated from Mexico). These are ways to innovatively forge ahead.

Prof. Jain's humble beginnings, his meteoric rise and true Indian spirit was totally inspiring. I felt really enthused after the speech. Well, anyhow I should have guessed that you cannot go wrong with a name like that.