Brij Singh's Random Musings

Real estate job growth

NYT has interesting data points on jobs related to the real estate  sector. 

Encompassing everything from land surveyors to general contractors to loan officers, the sprawling sector has added 700,000 jobs to the nation's payrolls over the last four years..

Combined, the rest of the economy has lost nearly 400,000 jobs over the same span, which stretches back to the start of the most recent recession, in 2001.

Residential housing now makes up 16 percent, or $1.9 trillion, of the gross domestic product and is the economy's largest single sector, slightly bigger than the industries and services that supply health care, according to Economy.com

This shows how much more this real estate market can grow in India where its at around 7% of the GDP ! As Indian society moves towards ownership culture there will be significant ecosystem build-up around real estate.

Whereas here in the local market, don't expect any help for the first time buyer either as the lobby has it's reach all the way to the top:

The economic growth of the real estate industrial complex has only added to its longstanding political clout. The housing and construction industries gave $167 million to campaigns during the 2004 election cycle, more than the agribusiness, defense, energy and computer industries put together, according to the Center for Responsive Politics in Washington

What If

What If ? With roughly 11% of GDP riding on real estate this is a big If !

Softbank moves out of SV

[Via Silicon Beat] Soft Bank putting up a "we have moved sign" and moving their base to China. Their rationale -

U.S. deals are too risky - early stage and expensive to fund, not to mention technology-heavy. "Let's say I put $10 million in a U.S. company - it probably lasts 18 months," said Zhou, "and when I do that it's probably not even profitable. In China, chances are that when we do the $10 million deal the company's profitable and [the funding's] going to last a long time." India, Korea, Hong Kong and Taiwan are also places SAIF will invest

It takes courage to avoid the Silicon Valley charm. Though if you work through your spreadsheet then its a no-brainer  to not have any expensive early stage here.  Apply all the Carr philosophy,  speed to market pressures, barrier to entry,  time to copy jitters, high sales cost etc and you get a decent enough logic to move out of the bay area deal flow.  Significant dollar amount will go out,  will get invested elsewhere and help grow the phenomena of start-ups serving global markets.

Though we are hoping those companies will continue to feed Bay Area economy by having their HQ here !

irrational exuberance 2.0

When you see more of  the they-see-something-you-dont-see then that could be a sign of an irrational exuberance 2.0:

A San Diego developer who has built high-rise condominiums in Chicago, San Diego and San Francisco has offered the San Jose Redevelopment Agency $28.6 million for a prime 1.48-acre downtown parcel -- nearly four times what Cupertino's Sobrato Development Cos. offered for the same property and a new high for residential land in the urban core.

Urban West Associates envisions twin 25-story luxury condo towers at the corner of Market and San Carlos streets. But the price of $444 a square foot for land is raising eyebrows among commercial real estate developers.

The land price is premised on condos selling at an average of $640 a square foot, according to RDA executives. Condos in downtown have sold recently for an average of about $320 a square foot, although some individual sales have carried price tags closer to $450 a square foot

US based VCs in India

This is definitely a new trend (ok not yet a trend !). Bay area VC firm investing in automotive sector in India -

Gurgaon-based publicly listed automobile components firm Rico Auto Industries Ltd. is to raise about $24 million (Rs. 103.2 crore) through a preferential allotment to Morgan Stanley, New Vernon Bharat, and Bessemer Venture Partners.

Looks like non-technology sector is catching interest of VC firms. Same New Vernon Bharat bought 25% of Jagran TV.  Hindi language based media will see more action in near future.

Tiecon 2005

Attended the Saturday session of Tiecon. It was a packed gathering full of proven and yet-to-prove entrepreneurs.  I did not attend the Friday session but I could hear people talk about "Flatteners"  every now and then.  Thomas Friedman definitely left behind few good punchlines for people to remember and quote.

Some of the quotes from the conference: -

Cost of running offshore site in Spain is only 8% higher as compared to India - Virmani (Global Partner - Accenture)

Best introduction (received big applause for this) - "I am Craig Newmark, customer service rep and founder , Craigslist"

"I don't believe in low-end, high-end distinction. TCS was doing pure body shopping and now they are a multi-billion consulting giant" - PV Kannan, CEO 24/7 Customer

Some other tidbits , don't remember who said what !

Online bill payment growth number is about to hit hockey stick growth - Billeo CEO

Most of the Internet emerging startups are using Google adsense to pay their bills.  Atleast Fatlens, Billeo and Technorati acknowledged that.

What metrics to show to board members ? CTR, Conversion, Impressions, LTV , Irrational Exuberance (Ok I added the last one !)

New catch phrase for all outsourcers - Business Transformation.  Expect IBM to trademark eTransformers or maybe bTransformers. 

80% of the world cannot  afford HP products. This realization started HP's initiative to capture bottom of the pyramid. Hence e-inclusion type projects.

In order to ensure business continuity, Accenture makes sure  "same work profile" is available in Manila as in Bangalore ! ( If he is not speaking like a consultant then this is a huge process advantage - capturing work attributes, keeping them updated and putting global touch to it requires good amount of organizational and technical mastery)

All in all Tiecon was a good investment of time and money. For the first time I saw more non-Indians in the conference. This shows that the deal making is expanding.

Costly geographies

Sounds like a new restructuring argument:

We are over-invested in high-cost geographies like the U.S., and underinvested in low-cost geographies like India.

I read similar statement from IBM as well.

Get used to this ?

You may not like this but our privacy is as vulnerable as some laptop lying in the server room begging for intruder's attention. This is lame, UC Berkeley will get lot of flak for this.

Rishi - I hope your Haas adventure wont cost you your identity !

Few years back I made this bet with a close friend that ours is a last generation to actively enjoy privacy. Frightening as it may sound but we may be very close to achieving that longtail distribution model of our privacy. So get used to the idea of strangers from all exotic places - Vegas, Florida, Nigeria, Hungary and Bangalore  discussing the price to put on your ssn.

Startup opportunities in China/India

I have seen Gary Reischel speak couple of times in Comergent sales meetings. He is a straight shooter. 

I am on the record as saying that the next ten years are going to offer venture capitalists an unparalleled opportunity through investments in China and India. It will not be a smooth ride, but the domestic venture market has not exactly been smooth during the past nine years. Rarely can you look out ten years at markets like India and China and predict with certainty massive demographic shifts, but in this case you can. The integration of technology into every part of China is occurring at an unprecedented rate. We were in Tibet in June of this year and nomads living at 12,000 feet were using solar panels to charge cell phones, televisions, and other electronics. In addition, the cellular reception in the far reaches of western China puts the I-280 corridor in Silicon Valley to shame. India has its own stories, including countrywide hotlines for kids in trouble, services that do not exist at the same scale in the United States or Europe today.

There will be many mistakes made in China and India. The canny investors will be looking for deals where the market need is reasonably well defined. The very early stage investments will have to be carefully vetted, since the governance issues on deals in China and India are legendary

He gets this China and India things very well. Though lot of his peers are in a state of denial.

There we go again

[Via SiliconBeat] Like we need to be reminded about this every couple of years.

Its funny how this whole cycle goes through.