I just marvel at the in-depth knowledge that Ajay Shah has on such a wide variety of things. Thank you for dispensing it Sir! Amit bhai media company has diversified superbly into this format. Kudos!
All throughout the episode, two names were constantly hovering over my mind - Succession (the series) and The Godfather 1&2. And then came Amit's voice at last, soothing my inner turmoil! What an episode!! PS: Ajay, you could've easily recommended a couple more books for us gentle readers to benefit from, but you didn't! Why are you so frugal (like the family firms) when it comes to recommendations!?😂
“A rich country is made of sophisticated firms. A poor country is made of bad firms. All the work in public policy is about creating the conditions where the firms become better”
Watched this one hour after publishing. One of the best podcast episodes ever for certain kind of people - including me. Thanks Ajay and Amit for such wonderful content. Where do we pay? :)
Such a beautiful episode! Ajay builds an elegant and completely logical framework and completely de-mystifies how successful and long-lasting businesses might be built. I've read books and dense books in the two misspent years acquiring an MBA without getting a hundredth of the insight I got from this episode
One thing that can be added to this episode is the Tata Group of companies, one of the greatest pioneers in many sectors in India. In many ways they were the original wealth creators, a family business that went on to become a conglomerate.
This is honestly great! The insights and the hyperlinks that I get from here are top-notch and it blissfully points out my ignorance. Keep on going sirs! Also, the balance of technicality and creativity(assuming they are different) is just a chefs kiss. Just Lovely.
If Amit bhai and Ajay bhai make a company it would be ‘2ab’ company. The root of all solutions as per our supreme leader. Pls make this happen yesterday. Thank you
Another great episode. Re: Design 4, a newer addition to that is this notion of Founder led companies. At companies like Meta, Google etc Founders still control more than 50% of voting shares using Class B allocation. The premise is that in technology industry Founders vision and ability to will it into the world is very important and for that Founders are given a much longer rope (through voting power) and a buffer from Wall Street short term pressures than ordinary CEOs. In some ways it's a cross between design 1 and design 4. VC funded firms are set up with design 4 from the start. I think transitioning from design 1 or 2 to 4 while it been done at companies like Walmart, will be rare. New companies will be born with design 4.
I'd love to see what all books are there in the background bookshelf. Maybe a short 10 mins episode (a vlog) where Amit and Ajay pull out their favourite books from that bookshelf and talk about why that book is special. 📚
Great episode as usual..please make a episode on the white paper released by government on mismanagement of economy by upa..what's the truth and how to decode it..thanks
Not exactly related to this topic. This episode was fascinating as usual. I have a question - I was watching 'why India is poor' a conversation with Ajay Shah. I want to know if we individuals can make any difference for the country - apart from donating the money.
You are asking about the process of change. Hold that thought. It's good to be fully distinct between a humanitarian goal (feed the children) vs impact (make the world better). The latter is completely distinct.
At first glance, South Korea seems an impressive bastion of family firms. However, shareholders seem to be afraid of family control. Consider Samsung, the South Korean family firm. It is a phone and chip manufacturer (amongst many other things). Shareholders value Samsung at a P/E ratio of 13.6. Compare this with Apple's P/E ratio of 28 or TSMC's P/E ratio of ~24. This may give us some pause about considering the success of South Korean family firms.
Father son company🎉 tom watson❤ How does one become an independent director... So as to contribute in one of the boards based on the design 4 style companies😅
i wonder how the ideal situation of dispersed shareholding will come to happen. I don't see indian promoters diluting their holdings to achieve the shareholding structure of 'the modern firm"
How do we prevent the risk of the bob Rubin trade? A modern CEO doesn't have a downside risk. What do you think about the robustness framework, where the firm is robust using optionality
The family is risk averse, because they have too much of their resources in the firm, and legacy which should be destroyed etc.. But doesn’t this analysis take into account some particular type of personalities and exclude others. I mean people might respond in differ ways to the same incentives. A particular type of person might say “this is my family legacy, I have to take it to the next level”. Because of the same incentives they might be even more aggressive to take risks?
At individual levels, people respond to incentives differently and sometimes unpredictably. However, at macro-levels, the response to incentives is fairly predictable. There are always outliers, but the average is fairly consistent.
