Widely read:
Anand Kumar
New company + IPO + new business.
Based on everything I've always written about the three topics above, we should not be doing the cover story of 'Wealth Insight' November 2023 issue. IPO investing is hard, small companies are harder, and companies that invent new businesses (especially digital ones) are even harder. That's true for the set of companies that we have this time. Many of these companies are not great businesses; some are struggling, some have never made any profits, and some may never do so. For this very reason, I have been heavily critical of some of them.
However, for this cover story, that actually does not matter. As investors, the first part of our job is to absorb knowledge about business trends and businesses. Only after that do we start analysis and selection, and finally, we reach the stage of investing. To identify one successful business, we may have to look at dozens which are not successes but have some other characteristic that makes them worthy of some scrutiny. Much like the real world, the business landscape is vast and varied. It's a melting pot of innovations, experiments, and dreams. Some dreams come to fruition, while others fade away into obscurity. But every venture, successful or not, tells a story. And it's these stories that we, as investors, analysts, or even casual observers, should be eager to hear. Because within them lie lessons, patterns, and perhaps, unseen opportunities.
At some point, I ask myself, "Why focus on businesses that aren't making the cut?" Well, the answer lies in understanding the nuances of the market. Every business clearly shows the pitfalls, risks, and miscalculations that others can avoid. On the flip side, those who defy the odds, even if not profitable right away (or never!), often introduce disruptive innovations or fresh perspectives to industries that might need a shake-up. Moreover, in the digital age, the definition of success is constantly being rewritten.
For example, Flipkart, as a business, was an utter failure. However, it had a successful exit for its investors and the promoters, and it's now Walmart's problem. I guess it's a success even though the people who ran the company all these years proved to be fundamentally incompetent at the basic business. Many other new-age digital founders, even some of the most famous names, are like that.
Still, diving deep into these less conventional waters can also offer insights into emerging consumer behaviours, nascent technology trends, and shifts in societal norms. And sometimes, within these tales of challenges, setbacks, and perseverance, we stumble upon the next big thing.
So, as we embark on this journey of exploration through the world of new companies, IPOs, and innovative businesses, remember that the narrative is about more than just success. It's about the journey, the lessons learned, and the potential for what's to come. It's about broadening our horizons and understanding that, sometimes, unconventional stories can offer valuable insights.
We're not doing this cover story to pinpoint who's doing great or goofing up. It's more about soaking in the big picture of the business world. Whether soaring or struggling, every business results from someone's dream, sweat, and guts. So, it isn't always about crunching the numbers. It's a nod to those daring enough to give business a go. As we flip through this story, let's not just hunt for the success stories or the failures. Let's appreciate the messy, unpredictable, and utterly fascinating world of business, out of which great investments arise and the not-so-great ones, too.
In cricketing terms, business is always a percentage shot. Some go straight to the fielder's hands, but some clear the ropes.
Also read: A game of percentages
This editorial appeared in Wealth Insight November 2023 issue. To read the cover story and other insightful analyses, columns and articles
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