“Show me the incentives and I’ll show you the outcomes”  Charlie Munger.   I haven’t yet found a profound statement to describe everything that happens commercially across the globe.   Share your e...

“Show me the incentives and I’ll show you the outcomes” - Charlie Munger. 

I haven’t yet found a profound statement to describe everything that happens commercially across the globe. 

Share your examples how incentives are misaligned with outcomes that you would expect so we can think deeper. 

Let me start off - 

1. Relationship managers advising you to buy financial products that have high commission vs what’s appropriate for you.

2. Insurance agent / broker selling you policies with high commission with poor returns or missold benefits.

3. Doctors advising you to get a surgery when it may not be really needed.

4. Pharma companies potentially not finding cures when they keep you hooked lifelong on their drugs? 💀

These are some things I have wondered about. What about other examples?

Incentives and outcomes

Growth Manager

Incentives and outcomes- Grapevine

Welcome to Indian Startups's Private Community

Do you guys agree with the list? Anymore candidates

Dead 11

Oyo was the only Indian startup who had defined a  India specific problem, had a solution and had money to scale. What went wrong? What a pity. 
  
 In comparison Airbnb made it big...

Software Engineer

Project Manager

Have you guys ever been mis- sold a financial product like life insurance policy or ULIP?

Insurance Mis selling survey

Product Manager

Uber designers (or PMs) why are you trying to get rid of the ride search cancel button? Found a ride faster and cheaper ride on Namma Yatri but can't cancel until Uber decides it's ok to do so! 

Won't be surprised if this leads to accidental bookings and shifting the onus on the rider to pay a "cancellation" fee. 

Why chase vanity metrics at the expense of the user experience? Switchers gonna switch.

Uber dark UX pattern

Welcome to Office Gossip's Private Community

You can mention current/ex company. Or don't mention. Just say the scam. Let the common things be known.

What's a scam that your company does?

Something I've found very frustrating while pitching to investors, platforms and funds is that so many of them actually just bait and switch.

They pose like gyani people earnestly looking for investments or helping entrepreneurs, but when you speak to them they start selling you their services.

Fundraise is apparently just a step away, need to signup here first, or create xyz report first, or do outreach to xyz number of people, or do market research and fresh pitch deck creation, or hire xyz consultant/agency to get to the "next level" - basically a bunch of barriers you need to pay to clear despite having a profitable business with paying customers. 

Fact of the matter is there are plenty of people raising money based off of pitch decks with no MVP , or even just the right conversations with the right people. But they are rare and hard to find organically. Requires lots of networking and connecting dots over months and years.

The point is, this selling in the guise of securing investment is tiresome and a waste of time for most entrepreneurs. They probably do get a few suckers occasionally which helps them stay afloat I guess.

Some of them might even take your ideas and start building something of their own or back someone to build it under them. Once you start pitching, the deck starts floating around in VC groups and networks mostly beyond the reach of the average entrepreneur.

Considering all this, just keeping one's head down and bootstrapping forever in peace seems like a better approach.

Disingenuous behaviour in startup ecosystem

Product Owner

We are seeing news of lay-offs from many companies- in India as well as RoW; Being at the receiving end of it is utterly painful. But who is to blame? 

Hindsight is always 20/20; So in the current moment, we can go about and blame the management for overhiring and now firing.

But since a lot us would get into similar shoes over time, would love to know how others would have done it differently.

When the market was kind and capital was cheap, companies/functions/leaders wanted to experiment with every or more ideas having some potential. They wanted to test every market (in terms of geo expansion) and if they wouldn’t competitors would. Definitely some experiments become successful while some fail. There would have been a pressure from Investors which would have translated to internal pressures.

Even most of us were just shifting jobs for money without even having conviction in business models of companies we were joining.

Who to blame? Investors for seeking growth or CEOs to not have enough hindsight or experience to know such times will come or functional leaders to comply to wishes of their management? Or us to fall into unsustainable greed trap?

But now it is about survival. Cutting off vestigial or infected organs vs letting the whole org die. What would you have done differently in the shoes of these CEOs?

What would you do in similar position?

3 days back when we launched Moonlight "India's largest moonlighting platform" which you can visit at https://www.moonlightnow.in/ we got 80+ registrations within 2 days of launch and when we called them to understand the reason to moonlight we got 1 biggest reason.

Fear of Job Loss or Job Security

Some people raised question about Ethics, Right or Wrong my answer to all those who talk about Ethics & Moral Science here is my take on this.

1. When a company fires without giving a notice is there any ETHICS AND MORAL SCIENCE behind that.
2. When CEOs of companies appear in Shark Tank are they not moonlighting by making secondary income
3. When CEOs of startup run Youtube channel are they not moonlighting.
4. When CEOs of startup doing angel investing to get massive returns are they not moonlighting.
5. When So called EDUCATORS teaching on edtech platforms while doing job and making money ARE THEY NOT MOONLIGHTING.
6. When cricketers are playing for INDIA and simultaneously building business ARE THEY NOT MOONLIGHTING.


EVERYONE IS MOONLIGHTING and giving the label as per their conveinence so if you also want to moonlight don't think about ethics think about your future and securing your future.

DO MOONLIGHT by registering on India's biggest moonlighting platform https://moonlightnow.in/

Moonlighting Right or Wrong?

Founder

Can you grow your career by displaying honesty at work?

Do you think manipulative people are most successful at work?

What category do you think you come under?
Honest or Manipulative?

If people at work, force you to be manipulative, would you accept it for the sake of your own career growth?

Honesty at work.

Software Architect

Why India lags behind in AI

We’ll be able to move mountains once we stop obsessing with IITians. They work their asses off to get into IITs to get high paying jobs, it’s as simple as that. Train tier-2,3 college students who have nothing to lose. You’ll achieve 100x more optimal results with 100x less investment.

Product Designer

I believe it is extremely difficult to judge exact level of an individual during an interview. It is better to also use past salary as some indication of value to last company. Having said that, the company needs to get to the correct salary range depending on performance in first 6 months. 

Thoughts?

(Controversial Opinion) I think it’s okay to give salaries based on past salaries

Consultant

I recently came across the world of generic medicines. On reading more upon it came to understand that the main components of a medicine are the Core drug, Strength, Form and Pack Size. It doesn’t matter which brand you pick as long as the four things above are same. 

Example 
Dolo 650MG Tablets, 15 Pack. 

Core Drug: Paracetamol
Strength: 650 MG
Form: Tablet
Pack: 15 (Strip)

Brand Name (optional): Dolo

Generic drugs come without a brand/drug name but are as powerful and follow the same quality standards. 

I was amazed to know that they are consistently 60-80% lower in prices. Can’t imagine how much it could benefit someone suffering from chronic conditions like Diabetes, Hypertension etc. 

Does anyone know more about this? Why are generics not so common or available and spoken about? Or is it that in late to the party 😀

Are medicines supposed to be so expensive?

Welcome to Personal Finance's Private Community

My dad's friend helps people invest money into Mutual Funds, Bonds, insurance, etc. He says that he is incentivized by the company whose assets he sells. And, from us (customers), he doesn't charge any commission. So, it's a bonus for us that we get guidance from him at without any additional cost. 
Is this true and a standard practice? Because there are many digital investment platforms these days - Zerodha, Groww, INDMoney etc etc.

Investment - medium/channels

I'll go first: Scaler, Byju’s and MBA chaiwala

Which indian startups are overrated?

I am fed up here as I don't see accountability anywhere. 
There was a Telugu Movie starring Mahesh Babu where he being CM says, in foreign, people are responsible and accountable and they made their lives beautiful. How amazing, right? I truly resonate with that thought

We lack accountability in everything we do.
- if something goes right, it's us, if wrong, it's them!
- We don't hold our govt politicians on their promises, on delivering things of value
- Companies go on screwing us, we don't give a damn. Refunds are processed without timelines, cases in country are backlogged for years and years
- We cannot even keep our cities clean, our air pure and our water drinkable and we are least bothered by it
- We cannot maintain our own infrastructure like Buses, railways, trains. We fucking are stealing mugs from railway toilets due to which it's chained (wtf!)

We don't want responsibility and no one should question us.
How are we really supposed to grow?  
Stringent laws in place helps with accountability of companies who at all times think how can I squeeze more money from people and screw them
Accountability keeps everyone in check.

Change my view!

[Rant] We lack accountability in almost everything

Despite being #1 in population, I find vaccuum in Imp Fields like
- Politics - no great politician
- Media - no great journalist 
- Music - very few great artists like A.R.R
- Movies - Bollywood is struggling 
- Sports - Except cricket other all sports suffering 
- Innovation- Hardly any pathbreaking companies.. 
& So on… If you agree what are the reasons for this? Are we just focused on playing it safe and earning money ? Or there are no role models to follow?

Do you feel there is a vacuum in very important fields in India?

IMO educational, insurance, investment products can drastically change one’s life for better or for worse, so much mis-selling, scamming and shitty sales tactics being done 😐

Someone ain’t scaling the right way 💁🏼‍♂️

Sales

There are essentially four parties in the startup economy:

1. The Consumer
2. The Enabler(read, Startup)
3. The Service Provider
4. The Investor

Now let's look at Game Theory motivations:

1. The Indian Consumer wants to minimise money spent per unit value extracted, the Western Consumer wants to maximise value extracted per unit money spent. (There's a massive difference.)

2. The Startup depending on the stage wants to maximise User Growth and Free Cash Flows.

3. The Service provider wants to maximise financial incentives.

4. The Investor is wants to maximise the XIRR of their fund. For this they need to reach a multibagger liquidity event.

Now let's look at what happens when:

1. The Consumer gets f'ed over: 

The startup attains pricing power through deep competitive moats allowing for monopolisation. They can jack up the prices to ensure nice FCF, greater rewards for Service Providers and great returns to their investors. (Think, Uber can charge anything to you now)

2. The Startup gets f'ed over: 

The users get bang for their buck, the service providers get good incentives, the investors push for higher growth but unfortunately the startup does not have enough capital to service their Cost of Operations through their unit economics, so they will either run out of cash or investor patience. Either ways, they are doomed. (Think every legit startup that failed)

3. The Service Provider get f'ed over: 

This is the likeliest scenario as they have the least power in this dynamic. Rewards will be reduced over time or made harder to achieve. They have no option because they got no option for sustenance. (Think any on-demand service providing app)

4. The investor gets f'ed over: 

Now imagine there is a startup that can balance the act very well. They have a service that users are willing to pay a margin on. They pay their service providers fairly and have decent unit economics. Now, the investor will do halla about destruction of shareholder value from little growth. (Is this the case with BluSmart?)

Maybe that's why building in India is tough.

[Rant] Here's why someone usually ends up f'ed over, for a startup to get successful in India

Hello guys,
I would want to know what is the benefit of getting ESOPs in an early stage startup?
The startup has a great team and working on a promising product. 
I have been offered a package with somewhat lower fixed component and somewhat higher ESOPs. Need insightful pointers here. TIA :)

Value of ESOPs in early stage startups?

The ESOP is a bit of a blind bet.  
  
 It's paper money that can get you a windfall if all goes to plan and execution, solution, pricing, market readiness amongst other things, all line up over the next few years.  
  
 I wouldn't take a pay cut in lieu of ESOPs.  Keep the real money real and the paper money as an outside bet.

Sales Manager

Do you know the reason for getting up everyday and working? Have you found why you wanna do what you wanna do?

Examples from TV series -
Naruto wanted to be Hokage because he wanted everyone to see him, acknowledge that he exists and he is someone important.

Mike Ross in Suits wanted to be lawyer to help people because of what happened with his parents

Patrick Jane in Mentalist was a CBI consultant because he wanted to find killer of his wife and Daughter

Sheldon cooper pursued physics bcoz it made sense to him and he wanted to win a Nobel

I can only quote such examples as I haven't found real life people who have any reasons for why they do what they do apart from the reason of making money.
Even here, I find most posts about making money/salary discussions. I have rarely found any post which talks about something meaningful other than money.

Disclaimer- I am not saying money isn't a good enough reason. I am trying to figure out if someone has reasons other than money. 

Would like to hear why they chose the field they chose!

Incentives and outcomes

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