The link between corruption & early stage venture returns in India

Standard

As everyone knows, venture returns are determined by building innovative products and services that reach scale. The operative words being INNOVATIVE and SCALE. Stuff that has not been built or tried before, stuff that delivers much greater “value” to the customer. We also know that India early stage returns have not exactly been stellar. I’ll present one framework here which tries to link corruption to the challenge in venture returns.

I think everyone knows that the Indian consumer (and business customer) is very price sensitive. The question is why? I think in order to understand this, one needs to understand the concept of opportunity cost. Let me explain it through a small personal story. We had our first child in San Francisco and very close to our apartment there were good, but slightly more expensive, grocery stores. My wife and I would have to make a choice: should we spend extra 30-45 mins for groceries to get the cheapest price or pay the higher price but get that extra time with our daughter. More often than not we’d choose paying more because time everyday was finite and we wanted to get a lot done at home and at work. In other words, we appreciated “opportunity cost” – that our lives could be a little better by spending some money to get extra time at home. And there were similar examples where we’d spend the money so we could be more productive at work (and an implicit understanding that in the longer run that extra investment had greater returns). This was not always the case; growing up in India we were taught to be extremely price conscious. Pre-1991 reforms if you did not have a family business and worked for a public or private sector company, there was a very high correlation between age and salary. That was the result of a closed, license-raj driven economy. What that told the average worker is that no matter how hard you try your “topline” cannot grow all that much so the logical thing for each person to do was to really focus on cost management in order to get financial security. These behaviors were drilled into the Indian psyche for decades and such behaviors which have achieved scale are very hard to unravel. On the other hand, in an environment where your “topline” can grow rapidly depending on how hard & smart you worked, there is all the incentive to focus time and energy on growing the “topline” rather than cost management.

As the Indian economy opened up & wages rose, we have seen much higher levels of consumer spending. The challenge however has been that the habits of the past have been hard to break. While opportunity costs have risen, the appreciation of opportunity cost by a large percentage of the population will take multiple generations.

But the other big challenge in appreciating opportunity cost is also the quality of the day to day interactions. The reality is that daily interactions are very poor even today and therefore trust is very low. The bribery scandals, the rape cases, the worsening infrastructure, the hassles of dealing with law enforcement, etc all negatively impact a consumer’s trust. All of these in one way or another have roots in the corruption in the system: The roads are poor and not improving fast enough because there is huge wastage of invested capital due to corruption in the system; traffic indiscipline is getting worse because law enforcement is not consistent or reliable – drivers break the rules with impunity … etc. In the end all these examples are rooted in corruption and not having a common set of rules that everyone trusts and abides by. This then has an impact on consumer’s willingness to try something new or pay more for greater value: “will it work?” , “what new hassles will it bring?”, “can I trust this company?” , “I don’t believe this will have the impact promised!”, etc. The default trained mindset is to focus on what you can get today because who really knows what will happen tomorrow. The consumer is just trying to make his/her life better and protect his/her loved ones the best they can; this is not a “cultural” thing, it is a systemic thing and quite frankly the biggest failure in India has been our inability to root out corruption. In other words, extreme price sensitivity is an expression of lack of hope.

With that background let me come back to the topic of this post and connect the dots between corruption and venture returns. Here is how I see it:

corruption in the system -> daily poor experiences -> lack of trust/hope -> lack of appreciation of opportunity cost -> extreme price sensitivity -> no value for high order products/services -> work is primarily dictated by operational complexity (not innovation) which is not very valuable -> poor returns for early stage investors 

What do you think? Valid connection?

My final comments on a Twitter discussion about design & India focused startups

Standard

Here’s the starting point of the discussion on Twitter:

Just to summarize my thought: the original referenced article talked about design being a key pillar of a startup. My contention is that that is a developed market centric view which should be applied carefully to India focused startups. It is first more important to understand the consumer’s concerns & see how design fits in there. Saying that the design sense of the Indian consumer is “not evolved” is saying that consumers haven’t yet caught up – that’s wrong. It is not the consumer’s job to “catch up”, it is the job of a company to understand what are the drivers of earning the consumer’s business. Design has become such an important differentiator in developed markets because consumer does not have issues of systemic trust.

None of this is suggesting that design is not important. But as entrepreneurs we need to allocate capital and resources correctly and figuring which problems are the biggest drivers is critical to that exercise. Design, IMHO, comes after trust has been earned, after operations are smooth … it is not a 1st order concern.

Sense of aesthetics is also fundamentally affected by surroundings: garbage on the roads, construction everywhere; the average consumer’s desire in India is just to have things work and be clean. Aesthetics is not yet a mass concern. Think of the online banking site of any Indian bank – from global standards of UI/UX they are horrible. In fact the one I use (large well known bank) is downright buggy and randomly logs me out. This has not been fixed in over 6 years; 6-long-years! You’d think this would be the death knell for the bank. But they have retail locations everywhere, they advertise heavily and for an average consumer that solves the first order problem: this bank will not run away with my money or go down tomorrow.

Take a look at these two great posts that came up in the Twitter discussion:

In short: when doing business in Rome, study Rome.

Q: Will Marketplaces Work in India? A: No.

Standard

Longer answer:  The poor quality of subsystems, supply chain & infrastructure is such that the best case is that marketplaces will take time to deliver a quality experience to consumers and therefore will take time to scale and reach meaningful profitability.

I have been quite excited by Uber’s launch in Bangalore. For anyone who has haggled with auto-rickshaw drivers and been ditched last minute by every call-taxi service, Uber’s commitment to providing a high quality on-demand experience is a welcome disruption. And yet I worried about how they will execute in India. As in developed markets they are choosing to integrate local cab companies and don’t quite have control over quality of cars and drivers.  The average black limo service in the US has been providing high quality service for years making sure that personnel are properly screened and trained and systems and processes are in place to provide a quality experience. In other words the quality of the subsystems in the cab industry is very high. But what a local cab operator in the US does not have is expertise and access to capital to consolidate like Uber has been able to.  Uber and others provide a “software integration” of fragmented suppliers without having to worry about the quality of the last mile delivery. It has worked great for consumers and for cab operators and drivers (who now have much higher utilization of their capacity). None of these underlying realities are true in India and my experience with Uber bears testimony to that. Without getting into details of issues I have had with Uber in Bangalore, I have reconciled to the fact that that they are going to be better than an auto-rickshaw and other services, but I should be prepared for an experience that is less than optimal. How they are going to scale this is anyone’s guess. As I blogged before, I stopped using Meru cabs because of scaling challenges they faced.  Uber’s biggest advantage is that their growth and profitability can come from other markets and there is therefore less pressure on the India operations compared to a player that is only focused on India. (For a great discussion about “vertical integrators” vs “system integrators” and the underlying subsytems that enable one or the other type of business take a look at this HBR article “Skate to where the money will be” by Clayton Christensen. The short statement I can make is that only vertical integrators can make it in India today).

I see all the same issues in the massive post e-commerce experimentation with marketplaces in India. Quite frankly, I am pretty astonished at how much people want India to look like a developed economy and solve those problems rather that first accept what India is and then get into problem solving.

Here are some simple ground realities:

  1. It takes time for consumer behavior to change at scale: this has a lot to do with underlying mistrust, a lot to do with low real and perceived opportunity costs. As a result CAC in India is very high and that is why large conglomerates such as TATA’s, Godrej’s etc are able to leverage their brands across multiple categories – they are fundamentally cross-selling because basic trust has been established over generations
  2. It is hard to charge the appropriate “value price”: I think it is too simplistic to say that the Indian consumer is price sensitive (it is true that s/he is), it is far more important to ask why (some day I will write about this). The impact really is that while a company may provide a decent service finding customers at scale who will pay the right price is impossible and this has a non trivial impact on LTV
  3. Contribution margin is generally low (obviously not in all businesses): This is a direct impact of poor infrastructure, process mindset etc and this then also has a big impact on LTV
  4. Debt markets are practically non-existent (except for companies with long operating histories or where land can be provided as collateral). And since the infrastructure is poor there is typically a very high CapEx requirement just to build the operating infrastructure. All of this has to be funded through equity capital

These are the ground realities. These are not a knock on India. In fact for those of us who have chosen to solve problems for the Indian consumer it is critical for meaningful problem solving to accept these realities and ask the business questions of growth, profitability and returns.

My problem with this experimentation with marketplaces in India is that this is just copy-pasting business models from a completely different environment and hoping that something will stick. I’d much rather ask questions such as:

  1. What adjacent markets (verticals or geographies) can a company address to expand addressable markets and accelerate growth?
  2. How much and at what frequency should one spend on marketing to maintain a healthy LTV/CAC ratio?
  3. Outside of debt financing from banks, what kinds of vendor financing can be used to decrease cash requirements for CapEx?
  4. What kind of software systems need to be put in place to improve contribution margins? How can mobile internet be used?

The answers in India are non-trivial and most of us are at the bleeding edge of trying things out unique to India to accelerate growth and achieve profitability. But I can speak for Peeyush and me: we’ve never taken our eyes off what the realities are. That is the only way we know how to solve problems.

The good news is that in the last 6-9 months as e-commerce funding has dried up I have seen a distinct improvement in the quality of conversations – people are starting to accept ground realities and asking meaty questions on how to solve real problem. Just today someone wanted me to walk them through the nitty-gritty of how Canvera is able to quickly reconcile payments from over 400 cities. I like this. I hope to see more of this as the startup eco-system matures. I’d like to see Indian problems being solved when serving the Indian consumer.

Always Be Doubling Down

Standard

It is commonly believed that the macro sentiment in India today is probably worst it has been since 1991. But is also said that downturns are the best times to build great businesses.

The secular growth trend of per-capita consumption is not slowing down & and the need for both physical and institutional infrastructure has never been greater.  So to my friends working and founding startups, here is a simple message: Always Be Doubling Down.

Fundraising environment getting tight? Double down and think of how to stretch your money further.

Raised a round of money? Double down and make sure you allocate it intelligently.

Had a great quarter? Double down and  understand with your team what worked and put resources behind the good initiatives.

Had a bad quarter? Double down with your team and figure out the root causes so that you can immediately take corrective action.

Macro economy slowing down? Double down and figure out growth segments within your customer base.

Employees leaving the company en-masse? Double down and figure out the management issues quickly.

Employees staying back and showing commitment? Double down and think how you can add value back to them.

Customers taking time to adopt your product/service? Double down and figure out new market segments.

Customers love your product and scaling fast? Double down and figure out scalability issues so product/service quality does not get affected.

Being part of a startup is like running a series of sprints to finish a marathon and the only way to survive is to have the energy & passions to keep coming back at it every single day. Here’s to building some great businesses in the middle of this maelstrom. ABDD!

Lessons from a community initiative: Defence Colony recycling program

Standard

The last few months have not been easy in India: economic growth is slowing, Rupee is declining, general lawlessness, regulatory flip-flops … the list is long. And yet there is so much to be done in getting India on a strong footing over the long term. Rather than lament about what is wrong this post by my wife Namrata is about a great initiative taken up by her and a number of volunteers in our neighborhood to improve the garbage collection situation. If there is one message I’d like to pass on to the readers of this blog it is to keep plugging away.  Bad times come and go and the only thing that counts is people who don’t lose steam and find meaningful things to do despite the challenges. Read on to learn more about what volunteers in our neighborhood achieved in 9 short months.

Dhiraj Kacker

——

By  Namrata Mundhra

In December 2012, a small group of Defence Colony residents, alarmed by the growing garbage problems of Bangalore, decided to take matters in their own hands and launched a pilot recycling program in Defence Colony, Bangalore. I was one of those residents and have been amazed at how much I have learnt about community-driven change from this experience. In describing how we developed and have managed to run this program despite the many hurdles, my hope is that more people will be willing to give such initiatives a chance. And will have an easier time of it by learning from our mistakes.

Today over 100 households in Def. Cly segregate their paper, plastic, glass, metal and e-waste and have managed to recycle over 5000 kgs of waste in the 9 months since we began this journey. No mean achievement.

Context: Defence Colony in Indiranagar,Bangalore is a community of over 500 households – a mix of many independent houses and small apartment buildings. There is about an equal mix of defence families and civilians today. Most residents are educated.  Community participation has largely been driven by and through the Residents Association. Membership with the Residents Association (DECORA) is voluntary upon payment of a small fee and only about 50% of residents are members. Resident fees and donations are the primary source of funds for DECORA and until recently there was no corpus available to fund large scale community initiatives.

From Left to right: ABC, XYZ

Def. Colony’s Motley Crew of Waste Managers, from left to right: Annie Thomas, Smita Shah, Rakhee Pankaj, Jyoti Kalapa, Sumati Prabhakar, Ambedkar, Agnes, Asha Muthanna, Namrata Mundhra (& kids)
Seated: Mich Gupta
On the bus: Rafiq

Genesis of the Dry Waste Program: In October 2012, the Bangalore Municipal authority (BBMP) announced new “rules” (ha!) for waste segregation and disposal. A small group of volunteers met with the BBMP health inspector to understand these rules so we could educate residents about what they needed to do to be in compliance. It did not take long for us to realize that nothing was going to change as the BBMP staffers and contractors continued to go their merry way. Rather than wait, a small group of us decided to take matters in our own hands. We focused initially on recyclable waste for 2 reasons:

  1. Most residents already segregate some of their recyclables – think newspapers and bottles – so we didn’t really have to create an entirely new habit – just piggyback on to an existing one.
  2. Back-end processes for recycling were also fairly well established – India has a network of kabadiwallahs, scrap-dealers, rag-pickers, etc. who already make their livelihood by recycling waste. So we were fairly confident that if we could figure out a process to collect segregated dry waste, we could recycle it.

To cut a long story short, we decided to partner with the RecycleGuru, an initiative of the Daily Dump (organization that focuses on composting products) to help us manage dry waste collection (since March we are working with the Domlur Dry Waste Recycling Center (DWCC) since they were much better position to handle large volumes)

This is when we began running into challenges and constraints. I describe below each hurdle we faced and how we managed to get around it.

1. It takes one bad apple to spoil the bunch: Residents that segregated at home, gave their waste to their domestic staff to dispose into common bins. Even if the home or apartment building had different bins for dry and wet waste – it took one careless person to dump organic waste into the dry waste container and contaminate everything.

What we did: We asked all households, even apartments to hold their waste at home and let our collection staff pickup. This door-to-door pickup added substantially to the time involved in collection but it also allowed us to ensure we got actual recyclable waste and not just garbage. This also allowed us to flag residents who were not segregating correctly so we could go back and talk to them about what they need to do differently. We also talked to the domestic workers and security guards during collection to educate them about the process. Today they are a very important element in helping us manage a smooth and efficient collection.

2. Show me the money!  The people doing your waste collection (assuming it is not the municipality) need to recoup their cost of collection in some way. Each collection requires a small truck, fuel, 1 driver and 1 collector/loader – the approx. cost of which is about INR 600-800 for a half day. And this does not take into account any profit the waste collection folks need to make so the effort is actually worth their while. Since DECORA didn’t have any spare funds to actually pay for collection and there was no way to impose and collect a separate dry waste fee on residents (particularly if we wanted the program to survive), we had to find some way of financing collection costs.

What we did: We asked people to pay for collection by giving us their high-value dry waste. Newspapers, magazines, milk packets, cardboard, glass bottles, metal are all higher value waste. If we got enough high-value dry waste, we could subsidize the collection of low value waste such as scraps of paper and plastic.

3.     People do want to have their cake and eat it too: Unfortunately this is where past habits worked against us. Many residents were used to selling their newspapers, and other high-value waste for some small amount and did not want to give that up. Some residents gave away their recyclables to their domestic staff and let them keep the proceeds from selling to the local kabadiwalla. Others donated their newspapers to charities such as the blind school in our neighborhood. If people opted out of giving us their high-value waste and we ended up with only the low-value – our collection partners would have no incentive to run the program for us. This really stumped us for a while.

What we did: The DECORA dry waste team volunteers went house to house to explain the program, costs of running the program and its benefits to residents. Initially we offered residents the option of either getting paid for their recyclables or donating proceeds to DECORA to help us fund collection. In our communication with residents we also stressed that the proceeds from our waste were helping small entrepreneurs who eked out a livelihood by managing our waste (appealed to their altruism to give up longstanding habits). Our volunteers were all residents who were passionate about the program and had strong ties to the community – with their help, we managed to get 85% of participants who signed up to give us all their recyclables and donate proceeds. For the ~15% of the participants who chose to get paid, we made sure we weighed and paid for their dry waste at time of collection so they still felt they had a choice. Since March 2013 we have transitioned out of this system – nobody gets paid but the program is completely self-funded (no fees, no funds from DECORA and no donations!).

4.     It’s not just a waste management problem, it is a change management problem: We started dry waste collection with a small group of DECORA volunteers going house-to-house along with our collection partners. Our goal was to phase ourselves out and let the collection folks take over in a couple of months. What we realized however, that most people were doing their bit because of us – their neighbors and friends. Given the general dysfunction around waste management in Bangalore, it is so easy to believe that no such new program will ever work. So it is valid for residents to think: why make the effort when it is bound to fail?

What we did: We expanded our group of volunteers (from 4 to 8), divided up the collection day into shifts of 1 to 1.5 hours each, and after a few months changed the frequency of collection from weekly to fortnightly so we could continue to run a volunteer-driven program. When residents saw us at their home every 2 weeks and realized we were not going away – they started making an added effort to segregate and hold their waste. Initially people pushed back about holding on to their dry waste for 2 weeks but our experience in the first couple of months had already demonstrated that most people do hold most recyclables for at least 2 weeks if not longer – what they object to is holding on to the bits and pieces of low-value dry waste and stuff that can attract pests like milk packets. But since the volunteers (their friends and neighbors) were asking they were willing to give it a try. And within a few weeks, most people had figure out their own system for holding their dry waste. Whether it is guilt, shame or trust – we were quite happy to use it to our advantage to ensure sustainability of this program.

5.     Nothing succeeds like success:  The pilot (of about 3 months) mostly included people the volunteers knew personally. Many other residents sat on the fence for a while – knowing about the program but not willing to take the next step of participating since they believed that like everything else, this too would come to an end in 3 months.

What we did: We made sure we kept up the buzz – we sent 2 emails a week to the residents group (and yes, having a residents group on email made our job much, much easier) with an update about the program, statistics of waste collected, reminders of how simple segregation actually was, etc. We decided that it was not our job to bully residents into participating or even to assume that once a solution was available everyone would automatically start segregating. Instead we deliberately allowed the program to grow word of mouth while ensuring that we keep up the communications through whatever forum possible. We organized special collection drives for e-waste and medicines, asked residents to talk to their neighbors, and leaned on our personal networks. It’s been a trickle, never a flood but we have managed to grow from the 30 households we started with to over a 100 participating households that actively recycle.

6.     Keep an open mind, really! When we started we made several assumptions. We would need to do a weekly collection. People need to segregate into multiple categories. Volunteers should stand back and let the collection staff run the show. Young professionals who are aware of environmental issues will be the more active participants. Door-to-door collection will not work.

What we learnt: None of these assumptions were valid. And because the volunteers were actively involved in the process, we really got to learn first-hand what could be done differently. Today we collect every other Saturday. We ask residents to segregate in a way that they find most convenient (since the Domlur recycling center we now work with does further segregation anyway). We ask the volunteers to be front and center during collection (and we all also pick up waste along with our collection partners so even our collection partners feel we are part of the team). Several of our older residents who have actively recycled and reused all their life are our most responsible participants. As more residents sign up and take responsibility, in some cases we are able to move to collection from a common bin – but we still largely run a door-to-door collection since we are able to get both more dry waste and better segregated waste.

In conclusion, while we still have a long way to go, after all only 20-25% of our residents currently recycle, I do believe that this program is now on auto-pilot. And if I could pinpoint the one decision that made the greatest difference, it would be to run this with the help of volunteers. In the words of Margaret Mead, “Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has

GoogleMaps, here’s how you can help India’s GDP

Standard

This post is solely written with the hope that someone at GoogleMaps reads it and does something about the problems I am highlighting.

——–

Anyone who has lived in India knows that we waste a ton of time in giving and taking directions. I have often tried to quantify the time and whichever number I come up with, one thing is clear: the time wasted in the “last mile” directions is enormous. Just today I had someone coming to my house (and my house IMO is easy to find since it is in a neighborhood with standardized streets name setup in a nice grid) and I had to spend north of 20 minutes on giving instructions on landmarks and right/left turns at the nearest CCD etc. Given that nearly everyone has need for directions, if this wasted time could be redirected towards more productive use, I can only imagine that it will make a dent in India’s GDP.

iPhone + GoogleMaps + Where-am-I-At

——

SUMMARY OF HOW I FIND MY WAY AROUND IN INDIA:

    • At any location (say home, office, restaurant), I use the app “WhereAmIAt?” to find the latitude and longitude of that location and I save that into my address book as part of notes for that contact
    • When I want to go to that place again (or ask someone to come there) I simply enter the latitude/longitude in GoogleMaps and track as I get closer to my destination. More often than not I DON’T use GoogleMap’s built in voice navigation

——-

Let me describe how I use my iPhone to find my way around. There are two main use cases:

  1. Businesses that show up on Google. This is quite straightforward, if a business (restaurant, hotel, office) is listed I can very easily find it and with the latest release of GoogleMaps I can even get directions. This works like a charm.
  2. Finding unlisted locations such as homes, apartments, unlisted offices, unlisted restaurants etc. This is where the complication resides.

Let me explain the second use case above in detail. In the US all streets are properly named, digitized and standardized to the extent that a ZIP+4 combination actually maps to a latitude and longitude and the street address can be reconstructed back from the ZIP+4. The problem I find with the mapping and GPS solutions for India is that they are somewhat expecting this level of digitization for it to work. That’s a tall order and is a classic example of copy-pasting a first world solution in an emerging economy.

Since these have not worked for me, this is what I do for places I visit often but can’t recall exact direction (this is particularly true for me as I visit our regional offices often but since I am not familiar with the local roads, I can get lost easily; or sometimes there is a simply a language barrier with the cab driver that causes problems): I use an app called “WhereAmIAt?” to find the latitude and longitude of where I am and I store the lat/long in my address book. When I need to visit the place again I simply enter the lat/long in GoogleMaps and track my progress towards my destination.

Here is a real example of how I reach my Chennai office: I tell the cabbie to take me to Mylapore and when close, I enter the lat/long and track like this:

IMG_0945

Once you have lat/long, all you need is to track progress to the destination. No need for knowing roads, landmarks etc. The lat/long can be easily shared through SMS, Email etc.

The blue marker is where I was when I took the screenshot and the red pin is where I needed to get to. This way, I don’t need to remember the road names and if we take a wrong turn I always know how to get back on track. In Chennai this is particularly useful as I don’t know Tamil and language can become a barrier when talking to the driver or asking for directions along the way. Not to mention the efficiency with which I reach my destination.

When I want to eat the most mouth watering idlis ever at Murugan Idli Shop (an unlisted local favorite in Chennai), I simply use this to get there:

IMG_0949

The “WhereAmIAt?” app let’s you find the lat/long of the place you are at.

So next time you want to have the same mouth watering experience, rather than saying let’s go to Murugan Idli in T.Nagar which is close to XYZ bank on the opposite side of ABC, just type in “13.0424409,80.2354165″ in GoogleMaps!

Behavioral Barriers

My observation has been that the biggest barrier to this has not been technology but behaviors. I have often tried to give directions to people by sending them the lat/long but hardly anyone seems to use it. There is just some safety in being able to call and get directions (3/4/5 times I might add) as they get closer to the destination.

However as Android phones become prolific, 3G/4G connections become standard and opportunity costs rise, I am hopeful that more and more people will use technology to at least solve this everyday problem and free up their time for more productive use.

My feature list

While it is probably best for a good product manager to flesh out the use cases, from the way that I use maps to find places, I’d like to see the following supported in GoogleMaps:

  1. An ability to quickly identify where I am without the need to use another app
  2. The ability to save the present location (or a dropped pin) to the address book
  3. The ability to open a saved location from the address book directly on GoogleMaps
  4. The ability to easily share via email, SMS, whatsapp etc a location with anyone

And here are some places one could use these features:

  • Calling a cab driver home / directing an auto-rickshaw – no more multiple phone calls for directions
  • Calling a restaurant for directions and getting an SMS from them with the lat/long
  • Got a wedding in the family? Print the lat/long on the invitation
  • Meeting at coffee shop and finding it difficult to explain which one? Just share the exact coordinates

The list goes on. The key is that precise location can be easily communicated and followed without the need for street names, landmarks or whatever else is used to give directions.

So, GoogleMaps, ready to make a dent in India’s GDP? :-)

Awful AIG lawsuit

Standard

I could hardly believe my eyes reading about the lawsuit AIG is contemplating against the US government. As Dan Primack called them “Arrogant InGrates”. I recently finished reading “Too Big to Fail” and even there I was struck by the absolute hubris of the executives who screwed up so big and yet showed no sense of responsibility. At the time the US government offered the bailout money, the CEO of AIG was reported to have said with a smile “They blinked” !! In essence, save us or we will take the whole system down. It really looks like it is going to take a very long time for the “Wall St. Culture” of making a buck at any cost to go away and be replaced with some sense of responsibility and good ethical behavior. The entire synthetic CDOs was just a simple Ponzi scheme and to think that supposedly intelligent people making millions of dollars would allow it to happen is just depressing. No product got created, no innovation around better capital allocation, nothing; just different ways to move money around so that the bankers could take a cut along the way. What a bloody waste of talent.