Softly call the Muster...

January 1. February 14.  July 4. October 2.  November 29.  December 25. December 31.  These are important dates when it comes to holidays.  April 21 is another special day for all Aggies.  It's Muster.  

My good friend Merriam-Webster defines the word "muster" as "to cause to gather" or "convene".   It also is common in military speak.  I find the term to be elegantly perfect for this special Aggie tradition.   Here are a few photos from my first Muster in London.  It was good to see boots, rings, and maroon!

If I Had the Moolah...

I just finished taking a GREAT class called "Managing Sport & Entertainment" this spring.   Great guest speakers, topics, and cases that ran the gammut including Manchester United, Cirque du Soleil, Radiohead, NYC nightclubs, Broadway theater, YouTube, the book publishing industry, and much more.


If I had a couple hundred million dollars lying around, I'd invest in a sports franchise (though be a bit more price conscious than the likes of Magic Johnson recently).   Or an entertainment business (there is convergence). Sports franchises are full of passionate people who tend to make passionate decisions.  Take for example European football (whose revenues top those of the NFL, MLB, and NHL combined).  Even in the economic recession, there is no "revenue problem" for European football.  Fans will pinch pennies elsewhere before giving up on football.  Stadiums are sold out.  Lucrative media deals are struck year after year (plus you have new players like Al Jazeera who are just throwing money at it and driving up prices).  Teams have increasingly learned to monetize the brand with licensing deals.  And while all this money is coming in, there has been a wave of European football clubs going bankrupt (some are publicly listed) and others continuing to struggle financially year after year.   The virtuous cycle should be that money comes in, it's invested wisely on and off the pitch, more tickets sold, etc.  However, it's warped in the opposite direction for some clubs.  My hypothesis is that some of these football clubs (and other sports teams, in general) have passionate people making irrational decisions (record contracts given to players, bigger stadiums, etc.).   I feel there's a positive correlation between the sophistication of the team off the field and the sustainability of teams.    Seems ripe for some turnaround investors (and cash flows are more stable than you'd think).


Another story that stuck with me was that of Guy Lilberte, the founder of Cirque du Soleil.  Around each big top touring show Cirque has, there is a white picket fence.  Guy calls this his world when customers walk through this fence.  If you've ever been to a Cirque show, you know that it's an emotional roller coaster where you leave on a high.  Guy's purpose for starting Cirque was so that when people entered his world, they would forget the troubles and torments of their life and let him entertain and educate them on what is possible.  And then maybe, when they walk out of the picket fence, they will take a piece of his world with them.  The best entertainment businesses are driven by something other than profit.  I personally respect them for that and think that applies to most businesses in general.

Leaving on a Jet Plane

Yesterday, I attended a lunch & learn hosted by our London Business School Marketing Club (they do GREAT events).   The guest speaker was Rob Britton, a professor turned airline executive.  He spent over 20 years at American Airlines and left as Advisor to the Chairman.   In the 1970s, Rob helped launched AAdvantage, the first airline loyalty programme, and his seminar focused on the value of these frequent flyer programmes (the only marketing tactic that has really worked for airlines).

A few random factoids and musings I wrote down in my Moleskine about this challenging yet very interesting industry:
-There's significant spoilage by the very nature of the service.  Weak demand, stiff competition, overcapacity, etc. leads to empty seats.  A surprising 20% (!) of seats flew empty on flights last year in the United States.

-The airlines business has relatively low barriers to entry (not good from a firm standpoint).   And, on top of that there are high exit barriers.  New airlines seem to sprout up every year but think about how they don't go away as often.  Once an airline goes belly up, the assets (planes) are worth more cobbled together as a going concern than grounded separate planes.  And I don't imagine the secondary market for used (and many times old) aircraft is so great when the industry already has an overcapacity problem.

-The innovation in the industry has to come from customer experience (legroom, wifi, food, online distribution, etc.) and not the actual product or service (fast, long travel).  For over 30 years, most airplanes fly between 500-600 mph, which is slower than the speed of sound.  I don't quite understand all the physics behind it (need a Khan Academy talk!), but once a commercial jet breaks the speed of sound barrier, it becomes prohibitively expensive because of the amount of energy required.  More interesting info here: http://www.physicsforums.com/archive/index.php/t-173394.html

-Travelers prefer frequency to differentiation.  Boutique aspirants have tried to carve a niche in this space but fail every time.  Imagine a Goldman Sachs employee chooses to fly one of these high end airlines from NYC to London.   If and when a meeting runs over or there is bad weather, one of the legacy carriers could book him or her on the next flight out that day.  With a boutique airline, she or he may have to wait a day.  This resonated with me.  When I travel for work and return home, I want to get there NOW and will pay anything to make it happen.

-If you added up global airline profits throughout time, the sum is a loss.  That's not too surprising and could be used to call for shutdowns or thwarting of future investments.   However, I think airlines are similar to banks, they lubricate the rest of the global economy.  And thus, I foresee subsidization and loss minimizing policies for at least my lifetime.

Rob is a very entertaining and energetic speaker!   He is quite generous with his time too and does a circuit of top business schools each year.  Am going to solicit his help with an idea I came up with to see if British Airways or Lufthansa would be willing to give LBS Class Gift 2012 student donors the perk of airline status for a year.  I see it as a win-win-win marketing tactic for the airline, the school, and students.  Fingers crossed!

Don't be an Insider

"The real voyage of discovery consists not in seeking new landscapes but in having new eyes." -Marcel Proust

This French novelist was on to something with this quote.  One thing business school has taught me is that learning and problem solving aren't always necessarily about learning new things or seeing new problems.  Sometimes, it's about framing.  Or the content and delivery channel.  By this, I mean that alot of the learning in the past two years has come from cases (real experiences) and lively discussions.

One of the more interesting learning opportunities came about a week or so ago when convicted insider trader Garrett Bauer shared his story with students at London Business School and candidly took Q&A.   This event came from left field when Garrett contacted our PE & VC club and offered to do this.  I heard second-hand that the PE & VC club agreed to host this event because Garrett had similar other speaking engagements at US business schools and wanted to include us in the mix.

Essentially, Garrett was a day trader who used inside tips from a lawyer (his best friend) to make buy / sell decisions.  He did this for several years, and while it didn't always pay off, it doesn't change the fact that he acted on privileged and confidential information.

Garrett went into great detail on the information he got, the logistics of the scheme, how he got caught, and what it was like to be in prison.  He was tried in federal court, and it was there that he learned that his best friend ratted him out.  In a strategic move, Garrett plead guilty and was convicted.  He is now awaiting sentencing.  That is largely the decision of the federal judge who will give a sentence ranging from ~8-12 years based on the points accumulated from all the charges (insider trading, obstruction of justice from destroying a cell phone, and money laundering from using cash from an ATM to pay for insider tips).   Factors such as volunteer work, marital status and children, sickness, and amount of money recouped can influence the sentence given within the sentence guideline.   I don't believe Garrett is evil, and he's found an interesting way to use his time to teach others based on his experience and to also potentially lower his sentence.  He's also found the right audience with MBA students, and I believe he is sincere in his message of "it's just not worth it".   Not only for insider trading but also other "victimless crimes."

The Q&A lasted at least an hour.  The softball questions at first became a bit more candid and interesting as time passed.  I asked Garrett whether he had had a chance to talk to his best friend / insider trading accomplice since he was arrested.  He said that he had not and that his lawyer advised against it (because it would then lead to another type of charge added to his docket).  From what I could tell, he didn't show overt anger towards his friend for betraying him (surprising).  I certainly wouldn't be that forgiving.

The message of "it's not worth it" really came through.  (Not that I ever have or will user insider info).   From the way Garrett explained, I would never want to be the target of the federal prosecutors.  They make sure that they can win most cases they take to trial.  And many of the rules, precedents, and calculations are assymetric in favor of the feds.   He also did this for a decade, and didn't make that much (or any) money for many years at the beginning.   Plus, he made good money anyways.  Definitely not worth it.

Year of the Dragon

In January 2011, a few of my classmates decided to celebrate the New Year by jumping the fence and sneaking into Regents Park at night to light Chinese lanterns and toast with prosecco.

January 2012...we decide to make a tradition of it!  Our lanterns sailed much better this year given that it was much less windy (but equally cold!).   According to Chinese astrology, this is the year of the dragon, the mightiest of the signs.  Dragons are known for their dominance and ambition.  They live by their own rules and interestingly can feel unfilled and exhausted by their passions and enthusiasm.  I asked one of my Chinese friends how she traditionally celebrates Chinese New Year with her family.  Though different in specific traditions, there are striking similarities in how Western holidays are celebrated (great feasts, friends and family gathering, joyful greetings and optimism, parades, etc.).  I believe humans tend to overweigh the differences amongst cultures and discount the sameness.   This is an example.

I was curious to know what my Chinese zodiac sign is.  I was wanting some ferocious beast and was initially disappointed with the lackluster pig.  However, after actually reading about the character of pigs, I'm so happy I am one!!  Pigs are known for their diligence, compassion, and generosity.  They are giving souls (sometimes giving too much) and place a premium on honesty (which they expect to receive).  They have trouble asking for help (known pride issue), enjoy spending more than saving (ouch), and are astute bargain hunters (of course!).  Pigs can always be counted and are detail oriented.  And they enjoy opportunities that allow them to express their creativity.  I don't believe in astrology because I feel life circumstances and context (nurture) are as equally impactful as nature is in determining character.  However, it's hard for me to ignore how my Chinese zodiac sign perfectly nails qualities I aim for and am most proud of.   Just something to think about.

After our Chinese lanterns become specks of light in the distance and the bubbly was gone, we headed over to Berkeley Square.   My sweet friend Emily introduced me to this swanky area when we celebrated my birthday at Murano, an amazingly delicious Italian restaurant.  Another one of my friends ended up moving to this area and hosted a birthday gathering at The Only Running Footman (great pub on ground floor, two additional floors of fine dining, and an awesome chef's kitchen lounge on top floor).  If and when I land a job in London, I'm determined to settle in Berkeley Square :)

Pictures of the evening below.

MAXimum Fun

The holidays are always spent in Texas.  Always.

I spent a few days in Houston this December.  And what trip to H-town wouldn't be complete without going to Max's Wine Dive?  Things (people) change but also stay the same.  Here are some photos from the night taken with my new 35 mm prime lens (f/1.8) for my Nikon D5000.  This lens was recommended to me by three different friends plus Ken Rockwell's  website...totally worth it! 

Blast from the past.  LOVED seeing Menges (Laura) and Zappy (Holly)

 Me with the McMasters...can't wait for them to come back to London.  It's their turn :)

Reese and me reminiscing upon ex-pat life and Speed Scrabble

And, finally, being in Texas means that I can watch TV shows on demand with big HD TV's commonly found in homes.  My sister recommended the new TV show called Once Upon a Time to Me.  I disregarded it at the beginning because I thought it was insane to have a show about fairy tales.  Then, I learned the writers of LOST wrote this series too.  You can definitely tell because Once Upon a Time is all about the characters of the show and viewing their past to see how they became the way they are.  Watch in on Sunday nights!  Though I did watch ~8 episodes via Hulu on the TV.  It was a great 5 hours!

Kaleidoscopes

On our last evening in India, a distinguished friend and advisory board member of London Business School invited us (a group of 35!) to a dinner party at her posh home in Mumbai.  Dr. Gita Piramal is a successful entrepreneur, author, philanthropist, and socialite.  And the word "home" is an understatement for the beautiful 10 story mansion her family occupies.  She gave us a heads up that she had taken the liberty of inviting a few special guests, so I thought that was fine.  Until we arrived and realized that she had assembled a "who's who" guest list for our event.  There were CEOs, influential journalists, leading lawyers, members of the Tata clan, the David Letterman of India, a leader of the Blackstone Group, and more.  Part of the game that evening for me was going around meeting people, trying to figure out who they were, and then finding out why we were both at the same dinner party.  It was an incredible and surreal experience...a perfect way to end our trek!  Dr. Piramal's generosity in opening up her gorgeous home, providing a dang delicious meal, and thoughtfully putting together the guest list was something I admired (and hopefully can mimic one day).   She mentioned that she purposefully put together this eclectic guest list because she wanted to create a kaleidoscope effect.  And I think it worked splendidly.  Different people, perspectives, areas of expertise, etc. all came together to create something beautiful.

The following morning, news of our dinner event was mentioned in the Mumbai Mirror (a supplement to The Times of India).  http://www.mumbaimirror.com/index.aspx?page=article&sectid=2&contentid=2011122220111222022340870edef2331

Wherever I travel, I usually have a mental association.  Some places remind me of feelings (e.g. Italy).  Some places remind me of history (e.g. South Africa).  Some places remind me of people (e.g. Aggieland).  Some places remind me of food (e.g. Greece).   And some places remind me of colors.  For example, Scotland (the greenest place on Earth) and Morocco (browns).  India reminds me of a rainbow or kaleidoscope.  Rarely or never will you walk into a retail shop to find clothes in simple black, gray, or white.  Usually, people where bold colors in combination.  Here are some kaleidoscope photos from my trip.