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Curated Insights 2018.05.27

Borrow…If you dare

Your problem is the margin. With $10,000 to start, if you borrowed millions, you would lose all of your equity. In fact, having a leverage ratio more than 4:1 ($30,000 borrowed) would have wiped you out in most years. It’s not a matter of if, but a matter of when.

As soon as he said it, I knew he was right. I had forgotten one of the simplest ideas in finance: the path matters. The problem is that while we know that you will get an a high return by the end of the year, if you hit a bad patch of too many negative return days in a row (which is normal), the leverage will wipe you out completely. In other words, the journey is more important than the destination.

The point of all of this is that even when we know the future with certainty, borrowing money isn’t a surefire solution to win big. Given we will never know the future with any degree of certainty, leverage is one of the most dangerous things you can do as a retail investor, so I do not recommend it. If Warren Buffett only levered 1.6:1 on average throughout his career, and he is arguably the greatest investor of all time, what chance do you stand of using leverage properly?

Your investment journey will effect you far more than your investment destination. Just because you know the market should get 7% on average each year doesn’t mean you won’t live through sharp declines and decades of no real returns. These kinds of events are rare, but they happen and they can affect how you perceive markets.

The Bill Gates Line

This is ultimately the most important distinction between platforms and aggregators: platforms are powerful because they facilitate a relationship between 3rd-party suppliers and end users; aggregators, on the other hand, intermediate and control it.

Of course that is the bigger problem: I noted above that Google’s library of ratings and reviews has grown substantially over the past few years; users generating content is the ultimate low-cost supplier, and losing that supply to Google is arguably a bigger problem for Yelp than whatever advertising revenue it can wring out from people that would click through on a hypothetical Google Answer Box that used 3rd-party sources. And, it should be noted, that Yelp’s entire business is user-generated reviews: they and similar vertical sites are likely to do a far better job of generating, organizing, and curating such data.

Presuming that the answer is the image on the right — driving users to Yelp is both better for the bottom line and better for content generation, which mostly happens on the desktop — and it becomes clear that Yelp’s biggest problem is that the more useful Google is — even if it only ever uses Yelp’s data! — the less viable Yelp’s business becomes. This is exactly what you would expect in an aggregator-dominated value chain: aggregators completely disintermediate suppliers and reduce them to commodities.

If we end up sitting around in self-driving cars watching ads, Google is going to make billions

New research from UBS predicts that US autonomous-vehicle revenue will reach $2.3 trillion by 2030—and 70% of the estimated is expected to come from selling experiences to the former drivers. The biggest opportunity—$1.2 trillion—will be in robo-taxi services, moving people and things around in autonomous vehicles.

The second-biggest opportunity, or $472 billion, will be in in-car monetization: selling ads or services against the time spent in the car not driving. Not surprisingly, UBS thinks Waymo—or more broadly, Google’s parent company Alphabet—will be the dominant player in this category, perhaps capturing 60% of the revenue. UBS thinks Waymo’s combined opportunities in services and software make Waymo worth $75 billion today, or roughly 11% of Alphabet’s current valuation.

Netflix misunderstandings, pt. 1: Netflix’s content budget is bigger than it seems

While it might seem pedantic to criticize statements such as “Netflix will spend between $7 billion and $8 billion on content in 2018,” the distinction is critical. To point, Netflix’s 2018 spend is likely to be closer to $12B. Not only is this nearly 50% more than publicized, it means that Netflix will spend more on non-sports content than any of its traditional TV peers (e.g. Disney, Time Warner, NBCUniversal) – even when their many individual networks are consolidated on a corporate basis. What’s more, the disconnect between Netflix’s cash spend on content and amortization expense has grown substantially over time. In 2012, this ratio was 1.1x (cash spend 10% higher than amortization). In both 2016 and 2017, it was 44%. As a result of this growth, the impact of conflating or confusing the two has also grown.

Netflix’s content costs are high in part because it now buys out all the rights (e.g. home video, syndication, EST) for its Originals on a global basis, while traditional networks (e.g. FX or ABC) will typically buy only select content rights and on a single market basis. Furthermore, buying out all rights means that the talent involved in a hit series (e.g. cast, writers, producers) don’t have access to any of the economic upside from participating in a hit series. As such, Netflix must also pay extra (and upfront) to compensate the talent responsible for their Originals for this lost income opportunity (albeit on a risk-adjusted basis). As a result, Netflix’s costs for a given volume of original content is substantially higher than that of linear and/or domestic networks with the same output. That said, this same dynamic means that while most of its traditional networks hedge their content investments, Netflix quadruples down.

Netflix’s critics and competitors typically focus on the fact that, while profitable on an accounting basis, Netflix keeps spending more cash than it generates from operating its business. The company burned $2B in cash in 2017 (up from $1.7B a year earlier), and expects that figure to grow to $3–4B in 2018. What’s more, Netflix CEO Reed Hastings has promised that negative free cash flow will continue for “many years” and the company continues to accumulate debt (raising annual interest expenses) and content liabilities (increasing the amount it’ll need to pay suppliers over time). However, this cash loss only exists because Netflix is funding next year’s content against this year’s revenue. Netflix could have chosen to stabilize its 2018 content offering at 2017 levels (i.e. not ramp up spending), and its actual cash spent would have been just $6.2B (roughly equivalent to its content amortization) – a “savings” on the books of $2.7B. And had the company done this, it would would have generated $700MM in cash, not lost $2B.

Making sense of mortgages: The problem, and the opportunity

The single most important chart for any portfolio manager or investor – The power of diversification (low correlation)

Of course, the picture represents ideal conditions. There is some bad news with this free lunch. It is hard to find. You will not find many low correlated asset classes and those return to risk values can be volatile. The incremental improvement is strong with the first few diversifiers but there are diminishing returns after that initial boost.

In a practical sense, the first asset class you add to an equity portfolio will be bonds. It has been the great diversify for the last decade or two, but once you get beyond bonds and commodities, the ability to find those low correlation assets becomes much harder. This is the true value of alternative strategies

What does this chart mean in reverse? If there is an increase in correlation across asset classes, the return to risk will fall even if the return to risk of any given strategy stays constant. This is will be the incredible shrinking free lunch and is why it is so important to find strategies or investments that have stable correlation relative to traditional asset classes.

Return is critical but hard to forecast. Volatility is important and leads to downside risks. Unfortunately, many forget the power of covariance and its impact on diversification, yet this is component to portfolio construction that can have a strong impact.

Next climate challenge: A/C demand expected to triple

The amount of energy needed for cooling will triple, reaching a level equal to China’s total power demand, the new report finds. As the world warms in response to human-caused climate change, the need for air conditioning will become more acute, particularly in the Middle East and South Asia. IEA estimates that left unchecked, air conditioning will account for 18 percent of the total worldwide increase in CO2 emissions by 2050. And rising demand for cooling is “already putting enormous strain on electricity systems in many countries,” IEA said.

Regional Notes 2018.05.25

Malaysia’s credit rating threatened by GST removal

“In 2017, GST revenue was RM44.3 billion or 3.3% of GDP. Unless the government introduces other offsetting measures at least over the next one to two years, the GST’s removal will have a net negative effect on government revenue, even accounting for some budgetary cushion from higher oil prices.”

“Beyond 2018, the reintroduction of the SST will create a revenue shortfall of 1.7% of GDP if the GST remains at zero. The ministry of finance said it will announce specific measures that will cushion the shortfall. According to the government, the rationale for eliminating the GST is that it will ultimately boost private consumption and economic growth, adding to the tax coffers through improvements in corporate and motor vehicle taxes, and excise and import duties. We do not include these effects in our assumptions because we do not expect a sizeable multiplier effect.”

“While it will uplift consumer sentiment in the short term, the actual consumer spending trend would depend on the impact of the GST removal on general prices. We foresee ‘price stickiness’ to be a major challenge for policymakers as businesses may, for example, be reluctant to reduce prices due to profiteering and a general belief that most businesses will not reduce prices.”

Malaysia’s 1 trillion Ringgit government debt explained

Federal government debt of 686.8 billion ringgit, or 50.8 percent of gross domestic product

Government guarantees of 199.1 billion ringgit, or 14.6 percent of GDP. The government is committed to paying the debt of entities which are unable to do so, including 42.2 billion ringgit for Danainfra Nasional Bhd, 26.6 billion ringgit for Prasarana Malaysia Bhd and 38 billion ringgit for 1MDB.

Lease payments for public-private projects of 201.4 billion ringgit, or 14.9 percent of GDP. The government is obligated to pay for rental, maintenance and other costs on a number of projects, such as construction of schools, hospitals and roads.

NTPM to spend RM50mil on expansion

“Our selling price has been adjusted by about 10% already, but still that is not sufficient. So, the profit has dropped. For this reason, we need to increase our market share to sell more. The growth of the tissue paper business in the domestic market is less than 3% a year, which is in line with global growth. In Vietnam and Indo-China, however, the growth is faster, which is why we are expanding the Vietnam operations.” Lee said the group was targeting to double the contribution from Vietnam by 2019 to RM80mil from RM40mil.

The tissue paper business generates about 65% of group revenue, while the personal care segment contributes 35%. Some 90% of the personal care business is generated from the local market. Despite the challenging and highly competitive local market conditions, the group succeeded in raising the revenue from the personal care segment by 9.4% to RM199.9mil in 2017.

Vitrox expects 2018 to be another growth year

“In the first three months of 2018, we have secured accumulated sales orders of about RM105mil, which will keep us busy for the next three months. The March book-to-bill ratio is 1:2, which means that for every 100 units of products we ship out, we receive 120 units of new orders in the same period. The current book-to-bill ratio is even higher.”

Curated Insights 2018.05.20

The spectacular power of Big Lens

There is a good chance, meanwhile, that your frames are made by Luxottica, an Italian company with an unparalleled combination of factories, designer labels and retail outlets. Luxottica pioneered the use of luxury brands in the optical business, and one of the many powerful functions of names such as Ray-Ban (which is owned by Luxottica) or Vogue (which is owned by Luxottica) or Prada (whose glasses are made by Luxottica) or Oliver Peoples (which is owned by Luxottica) or high-street outlets such as LensCrafters, the largest optical retailer in the US (which is owned by Luxottica), or John Lewis Opticians in the UK (which is run by Luxottica), or Sunglass Hut (which is owned by Luxottica) is to make the marketplace feel more varied than it actually is.

Now they are becoming one. On 1 March, regulators in the EU and the US gave permission for the world’s largest optical companies to form a single corporation, which will be known as EssilorLuxottica. The new firm will not technically be a monopoly: Essilor currently has around 45% of the prescription lenses market, and Luxottica 25% of the frames. But in seven centuries of spectacles, there has never been anything like it. The new entity will be worth around $50bn (£37bn), sell close to a billion pairs of lenses and frames every year, and have a workforce of more than 140,000 people. EssilorLuxottica intends to dominate what its executives call “the visual experience” for decades to come.

For a long time, scientists thought myopia was primarily determined by our genes. But about 10 years ago, it became clear that the way children were growing up was harming their eyesight, too. The effect is starkest in east Asia, where myopia has always been more common, but the rate of increase has been uniform, more or less, across the world. In the 1950s, between 10% and 20% of Chinese people were shortsighted. Now, among teenagers and young adults, the proportion is more like 90%. In Seoul, 95% of 19-year-old men are myopic, many of them severely, and at risk of blindness later in life.

Del Vecchio paid $645m (£476m) for Ray-Ban. During the negotiations, he promised to protect thousands of jobs at four factories in the US and Ireland. Three months later, he closed the plants and shifted production to China and Italy. Over the next year and a half, Luxottica withdrew Ray-Ban from 13,000 retail outlets, hiked their prices and radically improved the quality: increasing the layers of lacquer on a pair of Wayfarers from two to 31. In 2004, to the disbelief of many of his subordinates, del Vecchio decided that Ray-Ban, which had been invented for American pilots in the 1930s, should branch out from sunglasses into optical lenses, too. “A lot of us were sceptical. Really? Ray. Ban. Banning rays from the sun?” the former manager said. “But he was right.” Ray-Ban is now the most valuable optical brand in the world. It generates more than $2bn (£1.5bn) in sales for Luxottica each year, and is thought to account for as much as 40% of its profits.

The Moat Map

Facebook has completely internalized its network and commoditized its content supplier base, and has no motivation to, for example, share its advertising proceeds. Google similarly has internalized its network effects and commoditized its supplier base; however, given that its supply is from 3rd parties, the company does have more of a motivation to sustain those third parties (this helps explain, for example, why Google’s off-sites advertising products have always been far superior to Facebook’s).

Netflix and Amazon’s network effects are partially internalized and partially externalized, and similarly, both have differentiated suppliers that remain very much subordinate to the Amazon and Netflix customer relationship.

Apple and Microsoft, meanwhile, have the most differentiated suppliers on their platform, which makes sense given that both depend on largely externalized network effects. “Must-have” apps ultimately accrue to the platform’s benefit.

Apple’s developer ecosystem is plenty strong enough to allow the company’s product chops to come to the fore. I continue to believe, though, that Apple’s moat could be even deeper had the company considered the above Moat Map: the network effects of a platform like iOS are mostly externalized, which means that highly differentiated suppliers are the best means to deepen the moat; unfortunately Apple for too long didn’t allow for suitable business models.

Uber’s suppliers are completely commoditized. This might seem like a good thing! The problem, though, is that Uber’s network effects are completely externalized: drivers come on to the platform to serve riders, which in turn makes the network more attractive to riders. This leaves Uber outside the Moat Map. The result is that Uber’s position is very difficult to defend; it is easier to imagine a successful company that has internalized large parts of its network (by owning its own fleet, for example), or done more to differentiate its suppliers. The company may very well succeed thanks to the power from owning the customer relationship, but it will be a slog.

How much would you pay to keep using Google?

Part of the problem is that GDP as a measure only takes into account goods and services that people pay money for. Internet firms like Google and Facebook do not charge consumers for access, which means that national-income statistics will underestimate how much consumers have benefitted from their rise.

Survey respondents said that they would have to be paid $3,600 to give up internet maps for a year, and $8,400 to give up e-mail. Search engines appear to be especially valuable: consumers surveyed said that they would have to be paid $17,500 to forgo their use for a year.

There is another

Spotify has better technology, merchandising (like discovery playlists), and brand. Unlike Apple Music, being a pure-play (as opposed to being owned by a tech giant) gives Spotify more cred among purists, young people, and influencers. The instinct / T Algorithm cocktail has resulted in a firm with 170M users, 75M of whom are premium subscribers. The firm registered €1B this quarter, representing 37% growth. Spotify accounted for 36% of premium music subscribers globally.

What takes Spotify to $300B, and true horseman status? They launch video, and become the most successful streaming entertainment firm, full stop. Netflix’s legacy is on the second most important screen, TV. Spotify was raised on the most important – mobile. Netflix needs to become Spotify before Spotify becomes Netflix. Nobody has cracked social and TV, and as half of young people no longer watch cable TV, if Spotify were to launch video and captured any reasonable share and engagement via unique playlists, then cable and Netflix would begin ceding market cap to Spotify.

Subscriptions for the 1%

The problem with these minuscule conversion rates is that it dramatically raises the cost of acquiring a customer (CAC). When only 1% of people convert, it concentrates all of that sales and marketing spend on a very small sliver of customers. That forces subscription prices to rise so that the CAC:LTV ratios make rational sense. Before you know it, what once might have been $1 a month by 20% of a site’s audience is now $20 a month for the 1%.

There is a class of exceptions around Netflix, Spotify, and Amazon Prime. Spotify, for instance, had 170 million monthly actives in the first quarter this year, and 75 million of those are paid, for an implied conversion of 44%. What’s unique about these products — and why they shouldn’t be used as an example — is that they own the entirety of a content domain. Netflix owns video and Spotify owns music in a way that the New York Times can never hope to own news or your podcast app developer can never hope to own the audio content market.

The Apple Services machine

It is this hardware dependency that makes it impossible to look at Apple Services as a stand-alone business. The Services narrative isn’t compelling if it excludes Apple hardware from the equation. Apple’s future isn’t about selling services. Rather, it’s about developing tools for people. These tools will consist of a combination of hardware, software, and services.

Apple currently has more than 270 million paid subscriptions across its services, up over 100 million year-over-year. Apple is in a good position to benefit from growing momentum for video streaming services including Netflix, HBO, and Hulu. It is not a stretch to claim that Apple will one day have 500 million paid subscriptions across its services. Apple isn’t becoming a services company. Instead, Apple is building a leading paid content distribution platform.

Tencent Holdings Ltd. delivered two major milestones when it reported its earnings Wednesday: record quarterly profits and more than one billion monthly active users on its WeChat platform. The social media and gaming giant, which has been leery of barraging its users with ads, also declared it had raised the maximum number of ads that customers see on WeChat Moments from one a day to two. The app has become China’s most popular messaging service and is integral to driving everything from gaming and payments to advertising for Tencent.

MoviePass: the unicorn that jumped into Wall Street too soon

“The growth-at-all-costs strategy is being funded these days by the venture community, not the public market. The last time we saw the public markets fund a growth-at-all-costs strategy was the 1999 internet bubble, and we all know how that ended.”

The prospect of steep declines in a company’s valuations once it hits the public markets is one reason why U.S. companies are waiting longer to go public. Overall, U.S. companies that have gone public this year have done so at an average market capitalization of $1.1 billion, according to Thomson Reuters data, a 44 percent increase from the average market cap during the height of the dot com craze in 1999. At the same time, companies are now going public 6.5 years after receiving their first venture capital backing on average, more than double the three years between initial funding and going public in 1999.

Cerebras: The AI of cheetahs and hyenas

The specialist starts out with a technology optimized for one specific task. Take the graphics-processing unit. As its name denotes, this was a specialist technology focused on a single task–processing graphics for display. And for the task of graphics, graphics-processing units are phenomenal. Nvidia built a great company on graphics-processing. But over time, the makers of graphics-processing units, AMD and Nvidia, have tried to bring their graphics devices to markets with different requirements, to continue the analogy to hunt things that aren’t gazelle. In these markets, what was once a benefit, finely tuned technology for graphics (or gazelle-hunting), is now a burden. If you hunt up close like a leopard and never have to run fast, having your nose smooshed into your face is not an advantage and may well be a disadvantage. When you hunt things you were no longer designed to hunt, the very things that made you optimized and specialized are no longer assets.

Intel is the classic example of a generalist. For more than 30 years the x86 CPU they pioneered was the answer to every compute problem. And they gobbled up everything and built an amazing company. But then there emerged compute problems that specialists were better at, and were big enough to support specialist companies—such as cell phones, graphics and we believe AI. In each of these domains specialist architectures dominate.

We are specialists, designing technology for a much more focused purpose than the big companies burdened with multiple markets to serve and legacy architectures to carry forward. Specialists are always better at their target task. They do not carry the burden of trying to do many different things well, nor the architectural deadweight of optimizations for other markets. We focus and are dedicated to a single purpose. The question of whether we—and every other specialist– will be successful rests on whether the market is large enough to support that specialist approach. Whether, in other words, there are enough gazelle to pursue. In every market large enough, specialists win. It is in collections of many modest markets, that the generalist wins. We believe that the AI compute market will be one of the largest markets in all of infrastructure. It will be the domain of specialists.

This $2 billion AI startup aims to teach factory robots to think

What sets Preferred Networks apart from the hundreds of other AI startups is its ties to Japan’s manufacturing might. Deep learning algorithms depend on data and the startup is plugging into some of the rarest anywhere. Its deals with Toyota and Fanuc Corp., the world’s biggest maker of industrial robots, give it access to the world’s top factories. While Google used its search engine to become an AI superpower, and Facebook Inc. mined its social network, Preferred Networks has an opportunity to analyze and potentially improve how just about everything is made.

At an expo in Japan a few months later, another demo showed how the tech might one day be used to turn factory robots into something closer to skilled craftsmen. Programming a Fanuc bin-picking robot to grab items out of a tangled mass might take a human engineer several days. Nishikawa and Okanohara showed that machines could teach themselves overnight. Working together, a team of eight could master the task in an hour. If thousands — or millions — were linked together, the learning would be exponentially faster. “It takes 10 years to train a skilled machinist, and that knowledge can’t just be downloaded to another person” Fanuc’s Inaba explained. “But once you have a robot expert, you can multiply it infinitely.”

China buys up flying schools as pilot demand rises

In September Ryanair axed 20,000 flights due to a rostering mess-up made worse by pilot shortages. This forced the low-cost carrier to reverse a longstanding policy and recognise trade unions and agree new pay deals — a move that it said would cost it €100m ($120m) a year from 2019.

China is on course to overtake the US as the world’s largest air travel market by 2022, according to the International Air Transport Association.

US aircraft maker Boeing predicts China will need 110,000 new pilots in the years through to 2035, and its airlines are expected to purchase 7,000 commercial aircraft over the next two decades.

China’s aviation market grew by 13 per cent last year, with 549m passengers taking to the skies, double the number who flew in 2010. Growth is being driven by the rising middle class, an expansion of routes by Chinese airlines and the easing of visa restrictions by foreign governments keen to attract Chinese tourists.

California will require solar power for new homes

Long a leader and trendsetter in its clean-energy goals, California took a giant step on Wednesday, becoming the first state to require all new homes to have solar power.

The new requirement, to take effect in two years, brings solar power into the mainstream in a way it has never been until now. It will add thousands of dollars to the cost of home when a shortage of affordable housing is one of California’s most pressing issues.

Just half a percent

If you save $5,000 a year for 40 years and make only 8% (the “small” mistake), you’ll retire with about $1.46 million. But if you earn 8.5% instead, you’ll retire with nearly $1.7 million. The additional $230,000 or so may not seem like enough to change your life, but that additional portfolio value is worth more than all of the money you invested over the years. Result: You retire with 16% more.

Your gains don’t stop there. Assume you continue earning either 8% or 8.5% while you withdraw 4% of your portfolio each year and that you live for 25 years after retirement. If your lifetime return is 8%, your total retirement withdrawals are just shy of $2.5 million. If your lifetime return is 8.5% instead, you withdraw about $3.1 million. That’s an extra $600,000 for your “golden years,” a bonus of three times the total dollars you originally saved.

Your heirs will also have plenty of reasons to be grateful for your 0.5% boost in return. If your lifetime return was 8%, your estate will be worth about $3.9 million. If you earned 8.5% instead, your estate is worth more than $5.1 million.

Keep your investment costs low.
Slowly increasing your savings rate over time.
Consistently saving while treating investment contributions like a periodic bill payment.
Bettering your career prospects to increase your income over time.
Avoiding behavioral investment mistakes which can act as a counterweight to the benefits of compounding.

Regional Notes 2018.05.18

Japan seeks private sector’s help with blowout health costs

Faced with an aging crisis that’s projected to push up heath-care spending by more than 50 percent in the decade through 2025, the economy ministry is leading efforts for local governments to draw on the expertise of private companies.

The focus in Japan is preventive medicine, which could in time cut trillions of yen from government spending, according to Shinichiro Okazaki, an official overseeing the effort at the economy ministry in Tokyo. The nation’s annual health-care spending is forecast to reach 54 trillion yen ($500 billion) in 2025, according to the health ministry.

Short-term transitional issues expected in shift back to SST

“GST as you know covers everyone, retailers and traders. On the other hand, sales tax only covers manufacturers while services tax covers certain prescribed services such as professional services, so there must be a thought process on the transition to SST. Also there are still GST issues hanging around such as liabilities to be settled, so having transitional rules in place is going to be a challenge, and it is not something that can be done overnight.”

Meanwhile, there is the issue of how the government would make up for the shortfall in revenue with the abolishment of GST. Last year alone, some RM44 billion was collected in GST revenue. SST, according to chairman of the board of trustees of the Malaysian Tax Research Foundation SM Thanneermalai, used to only contribute about RM17 billion to the government’s coffers before GST came into force on April 1, 2015.

“That, to some extent, resulted in discontent for many, particularly in the B40 group, who were not previously taxpayers from the outset. Despite the fact that there are a multitude of exempt and zero-rated items, GST still translates into a significant amount for the B40 through its impact on prices, so the abolishment is most certainly a boon for this group of Malaysians. But it is left to be determined if the abolishment of GST will result in retail prices being adjusted downwards and in what manner and form.”

Malaysia sees favorable growth outlook as policy risks mount

The government must still outline how it will raise enough revenue to fill the GST gap in order to keep the budget deficit under control. The Finance Ministry said on Thursday the move will be “cushioned by specific revenue and expenditures that shall be announced soon,” with plans also to re-introduce a sales-and-services tax.

A revenue squeeze may prompt the government to cut back on spending, while a review of infrastructure projects could put a halt on construction, curbing growth in the economy. “It’s encouraging to see that the new government is already taking action to try and rationalize unnecessary and unproductive government expenditure,” said Goh. “We think that would actually help in keeping the fiscal balance in check.”

The gridlocked streets of Manila have become the latest battleground for Grab, despite the fact that it controls more than 90 percent of the ride-hailing market in the Philippines. With just 35,000 vehicles on its app to service as many as 600,000 requests a day, Grab has struggled to keep up with demand in areas like Manila, where an estimated 19 percent of commuters use ride-hailing, nearly double the average in other Southeast Asian capitals, according to Boston Consulting Group Inc. The challenge has created an opening for startups like Hype Transport Systems Inc. and Ipara Technologies and Solutions Inc., both of which plan to start services this month.

A Saudi-backed Asia refinery is going to be a fuel juggernaut

“The immediate impact from RAPID will lead to more Malaysian exports of diesel and jet fuel, while also reducing the need to import as much gasoline,” said Joe Willis, a senior research analyst for refining and oil products at Wood Mackenzie Ltd. in Singapore. “For middle distillates, Johor is conveniently located next to the Singapore storage hub.”

The RAPID project, operated by Malaysia’s state-owned Petroliam Nasional Bhd, known as Petronas, is due to start operations in 2019 with 300,000 barrels a day of crude-processing capacity. That’s a massive increase for the Southeast Asian country, which has a total 660,000 barrels of daily capacity now, according to Willis.

Still, Chin is hopeful the overall impact will be limited in the long-run. When RAPID reaches full utilization in early 2020, Asian refiners will be scrambling to meet a bump in appetite for the fuel as maritime rules that start in 2020 push shippers to replace dirtier fuels with cleaner ones like diesel, Chin said.

“With new mega refineries starting up in China and Saudi Arabia by the first quarter next year, there could be a brief window of weakness in diesel cracks before IMO effects kick in,” he said, referring to the upcoming maritime regulations to be implemented by the International Maritime Organization.

Willowglen sees challenging year ahead

“This year, I am not too sure, it could be quite a testing year. We should be all right in the longer term, [but] in the immediate term, there [could be] not much improvement compared [with] last year, it could be even worse.” This is due mainly to issues in project execution and delaying of awards from clients who are still resolving technical issues, especially those that are infrastructure-related.

While more than 70% of its revenue was contributed by its primary market of Singapore, with the balance coming from Malaysia, the group said it will continue its exploration of business opportunities elsewhere, especially in Vietnam, where it commenced operations a year ago. He assured that the group will not exit the Indonesian market — where it is involved in trading as well as the provision of hardware and software consulting services — but instead work on restrategising operations there to improve efficiency.

Curated Insights 2018.05.13

Who’s winning the self-driving car race?

Only Waymo has tested Level 4 vehicles on passengers who aren’t its employees—and those people volunteered to be test subjects. No one has yet demonstrated at Level 5, where the car is so independent that there’s no steering wheel. The victors will also need to pioneer businesses around the technology. Delivery and taxi services capable of generating huge profits is the end game for all.

Goldman Sachs Group Inc. predicts that robo-taxis will help the ride-hailing and -sharing business grow from $5 billion in revenue today to $285 billion by 2030. There are grand hopes for this business. Without drivers, operating margins could be in the 20 percent range, more than twice what carmakers generate right now. If that kind of growth and profit come to pass—very big ifs—it would be almost three times what GM makes in a year. And that doesn’t begin to count the money to be made in delivery.

Waymo had three collisions over more than 350,000 miles, while GM had 22 over 132,000 miles.

After Waymo, a handful of major players have demonstrated similar driving capabilities. It’s hard to say anyone has an edge. One advantage for GM: There’s a factory north of Detroit that can crank out self-driving Bolts. That will help GM get manufacturing right and lower costs without relying on partners. Right now, an autonomous version of the car costs around $200,000 to build, compared to a sticker price of $35,000 for an electric Bolt for human drivers.

Musk wants to use cameras and develop image-recognition capabilities so cars can read signs and truly see the road ahead. He has said Tesla is taking the more difficult path, but if he can come up with a better system, he will have mastered true autonomy without the bulky and expensive hardware that sits on top of rival self-driving cars. “They’re going to have a whole bunch of expensive equipment, most of which makes the car expensive, ugly and unnecessary,” Musk told analysts in February. “And I think they will find themselves at a competitive disadvantage.”

China’s got Jack Ma’s finance giant in its crosshairs

The rules will force Ant and some of its peers that straddle at least two financial industries to obtain licenses from China’s central bank and meet minimum capital requirements for the first time, according to people familiar with the matter, who asked not to be identified discussing private information. The companies’ ownership structures and inter-group transactions will also be restricted, the people said, adding that the rules need approval from China’s State Council and are subject to change.

Starbucks: A big deal should mean a sharper focus

The deal appeared positive because it ”accelerates the reach of Starbucks’ channel development segment globally by providing Starbucks with a strong distribution partner; and enables Starbucks to step up shareholder returns.

CEO Kevin Johnson said as much on the conference call. “We’ve been very focused on streamlining the company in a way that allows us to put our focus and energy behind the highest priority value creation drivers for the company,” he said. “And certainly, our retail business in the U.S. and China are the two big growth engines.”

Tinder: ‘Innovation’ can help it fight off Facebook

“In digital, and especially on mobile, there is always one brand that defines each core use case,” Ross wrote. “In dating, it is Tinder, whose user base and subscription base continue to explode globally. We don’t see that changing, even with scaled competition from Facebook.”

Tinder’s brand, scale and “freemium” model—with free basic access and the opportunity to pay up—should continue to make it appealing to users (particularly younger ones) even as new competitors emerge, according to Ross. “There is no real reason for singles not to still use the platform,” he wrote.

“The hard paywall brands tend to be those that are for the more serious online dater,” Ross noted, including older users and those seeking comparatively long-term relationships. “This is not only where Facebook has said it will focus, but also where it can best leverage its data and recommendation capabilities.”

Why A.I. and cryptocurrency are making one type of computer chip scarce

Crypto miners bought three million G.P.U. boards — flat panels that can be added to personal and other computers — worth $776 million last year, said Jon Peddie, a researcher who has tracked sales of the chips for decades. That may not sound like a lot in an overall market worth more than $15 billion, but the combination of A.I. builders and crypto miners — not to mention gamers — has squeezed the G.P.U. supply. Things have gotten so tight that resellers for Nvidia, the Silicon Valley chip maker that produces 70 percent of the G.P.U. boards, often restrict how many a company can buy each day.

PayPal: How it can fight back against Amazon Pay

“Given its two-sided network of 218 million consumers in the PayPal digital wallet and 19 million merchants for whom PayPal provides online & mobile merchant acquiring services, plus Xoom and Braintree, PayPal benefits from one of the most extensive payments ecosystems globally. Within this ecosystem, PayPal offers the best mobile wallet with an 89% conversion ratio from shopping cart to payment, creating strong consumer and merchant lock-in.”

It has other ways to provide incentives. “PayPal enjoys strategic alliances with Visa, Mastercard, Google, Facebook, Apple, Alibaba, Baidu, and a number of financial institutions, including Bank of America and HSBC, allowing it access to a vast customer base and potential consumer incentive plans,” they wrote, noting an HSBC offer to pay customers $25 if they link their cards to PayPal.

Etsy CEO: ‘Signs of progress’ in boosting repeat business

Etsy isn’t trying to become a place people shop every day, but it does want people to shop there more often. (The company cites figures saying 60% of customers buy just once a year.) It said both new and repeat buyers were up 20% year-over-year in Q1, which Silverman called “early signs of progress.”

Management wants to increase the “lifetime value” of a shopper by creating a cycle in which the company pays an acceptable rate for a new user, converts them to a buyer and then a repeat buyer, and then translates the money that buyer provides into more efficient marketing that acquires more new customers.

As Warren Buffett’s empire expands, many jobs disappear

Despite Buffett’s folksy image, Berkshire has thrived for years by keeping things lean and buying companies that—in his own words—are run by “cost-conscious and efficient managers.” The result? Buffett hasn’t shut down many operations during his five decades atop the firm. But more than two dozen of his companies employ fewer people today than they used to.

Berkshire often doesn’t note in the data when one of its businesses buys another, which can make it seem like there’s hiring when the conglomerate is just absorbing people. The company also doesn’t always make clear when units are combined or spun out of others.

The formula behind San Francisco’s startup success

Losing money is not a bug. It’s a feature. Not making money can be the ultimate competitive advantage, if you can afford it, as it prevents others from entering the space or catching up as your startup gobbles up greater and greater market share. Then, when rivals are out of the picture, it’s possible to raise prices and start focusing on operating in the black.

You might wonder why it’s so much better to lose money provided by Sequoia Capital than, say, a lower-profile but still wealthy investor. We could speculate that the following factors are at play: a firm’s reputation for selecting winning startups, a willingness of later investors to follow these VCs at higher valuations and these firms’ skill in shepherding portfolio companies through rapid growth cycles to an eventual exit.

Cheap innovations are often better than magical ones

Much of what we call “artificial intelligence”, say the authors, is best understood as a dirt-cheap prediction. Sufficiently accurate predictions allow radically different business models.

If a supermarket becomes good enough at predicting what I want to buy — perhaps conspiring with my fridge — then it can start shipping things to me without my asking, taking the bet that I will be pleased to see most of them when they arrive.

Another example is the airport lounge, a place designed to help busy people deal with the fact that in an uncertain world it is sensible to set off early for the airport. Route-planners, flight-trackers and other cheap prediction algorithms may allow many more people to trim their margin for error, arriving at the last moment and skipping the lounge.

Then there is health insurance; if a computer becomes able to predict with high accuracy whether you will or will not get cancer, then it is not clear that there is enough uncertainty left to insure.

The future of digital payments? Computational contracts, says Wolfram

Wolfram anticipates at least three levels of computational contracts, from minor transactions (less than $50) to mid-level (thousands of dollars) and high-end (in the millions).

“The lowest level–typically involving small amounts of money–one will be happy to execute just using someone’s cloud infrastructure (compare Uber, AirBnB, etc.),” he writes in his blog post. “There’s then a level at which one wants some degree of distributed scrutiny, and one expects a certain amount of predictability and reliability. This is potentially where blockchain (either public or private) comes in.

“But at the highest level–say transactions involving millions of dollars–nobody is going to realistically want to completely trust them to an automated system (think: DAO, etc.). And instead one’s going to want the backing of insurance, the legal system, governments, etc.: in other words one’s going to want to anchor things not just in something like a blockchain, but in the ‘weightiest’ systems our current society has to offer.”

A hedge-fund fee plan that only charges for alpha

Consider a hypothetical traditional hedge firm that has $1 billion of assets under management and another that charges a fulcrum fee of 0.75 percent, plus a quarter of the profits. If the markets rise 10 percent and the fund outperforms by 200 basis points, or 2 percent, a traditional hedge fund would charge $20 million (2 percent of $1 billion), plus a performance fee of $24 million (20 percent of the $120 million in gains) for a total of $44 million. Our hypothetical fulcrum fund would charge $12.5 million — a management fee of $7.5 million (0.75 percent of $1 billion), and a performance fee of $5 million (25 percent of the 2 percent above-market gain). The breakdown of the $24 million performance fee portion of the traditional hedge fund works out to $20 million for plain old beta and $4 million for alpha. That total is five times more than what the fulcrum shop charges for investment gains.

Now imagine a scenario where the market is up by 10 percent and a fund is up only 8 percent, or has 2 percent underperformance. The traditional hedge fund would have charged $20 million (2 percent of the $1 billion in assets under management) plus a performance fee of $16 million (20 percent of the $80 million in gains) for a total of $36 million dollars. Meanwhile, the fulcrum fund would charge $7.5 million (the 0.75 percent management fee), but it also would give a refund of $5 million (25 percent of the 2 percent, or $20 million, in underperformance). The net charge to clients would be $2.5 million. This is a small fraction of the amount charged by a standard hedged fund.

Why winners keep winning

With that 20% initial advantage, the final market share increases significantly. What is even more amazing is that this advantage was only given in the first round and everything after that was left to chance. If we were to keep increasing the size of the starting advantage, the distribution of final market shares would continue to increase as well.

The purpose of this simulation is to demonstrate how important starting conditions are when determining long term outcomes. Instead of marbles though it could be wealth, or popularity, or book sales. And most of these outcomes are greatly influenced by chance events. We like to think in America that most things come down to hard work, but a few lucky (or unlucky) breaks early on can have lasting effects over decades. If we look at luck in this way, it can change the way you view your life…

I ask you this question because accepting luck as a primary determinant in your life is one of the most freeing ways to view the world. Why? Because when you realize the magnitude of happenstance and serendipity in your life, you can stop judging yourself on your outcomes and start focusing on your efforts. It’s the only thing you can control.

Regional Notes 2018.05.11

Govt support is crucial in the expansionary rubber glove industry, says MARGMA

Rubber glove manufacturers said today government support is crucial in an expansionary industry like rubber gloves where the world demand is now at 268 billion pieces and Malaysia produces 63% of it.

“We look forward to working closely with the new government in sustaining the rubber glove industry and maintaining global leadership as a premier producer and exporter of medical-grade rubber gloves. The export of rubber gloves is worth an estimated RM18.8 billion in 2018,” said Low.

Kossan to spend RM1.5b on new base

Kossan Rubber Industries Bhd’s sizeable acquisition of more than 800 acres (323.75ha) of land in Bidor, Perak may have “surprised” analysts, but its founder views it as a natural progression given the robust global demand for gloves. The project is expected to take six years to eight years to complete at an estimated cost of RM1.5 billion, Lim said in an interview with The Edge Financial Daily.

Kossan bought the 56-acre plot in Batang Berjuntai and 98-acre plot in Kuala Langat in 2013 and 2017 respectively, for an aggregate sum of RM130 million.

“We can’t finish that sizeable land [in Bidor]. Technically, for us, 300 acres would be good enough. So after we put up infrastructure for our own use, we will try to subdivide and sell some pieces of [extra] land to invite some of our suppliers to come and put up their factories,” said Lim. “To go for a bigger space is all in line with our future development. While we will still do what we are doing here at our existing plants, we will most likely go for segregation to achieve specialisation,” Lim said.

Datasonic sees net profit surpass RM100m in FY19

Abu Hanifah believes the potential to expand its smart ID and e-Passport project both in Malaysia and overseas is huge. “We have been receiving a lot of inquiries from neighbouring countries, particularly about our passport products,” said Abu Hanifah, adding that countries in Africa and the Middle East have also expressed interest in its products.

“We have built the next-generation e-Gate, which cuts the time [for passengers passing through the gate] by almost half to less than seven seconds. We have patented it for nine months locally and will patent it internationally. This technology is the first in the world.” The new e-Gate system will no longer use fingerprint scanning, but will feature facial recognition technology instead. It will have two cameras; one of which will first identify the passengers before entering the auto-gate while waiting in line, and the second camera will reidentify the passengers upon passing through the auto-gate.

“Under this e-driving licence, we have proposed to the ministry of transport a one-stop solution where users can apply for a digital driving licence through the web. Users can also renew their driving licence, road tax and also pay their summons [online],” Abu Hanifah said, adding that Datasonic hopes to kick-start this project after the 14th general election.

Curated Insights 2018.05.06

WeWork’s $20 billion dream: The lavishly funded startup that could disrupt commercial real estate

The company makes money primarily through rent arbitrage: charging its members more than it has to pay its landlords. The principal means of accomplishing this is by packing a lot of people into its locations. In WeWork’s buildings, the average square footage per person hovers around 50 square feet. This compares to 250 sq ft for commercial offices industry-wide. Despite this small footprint, members pay an average of $8,000 per year, with WeWork capturing a healthy 30 – 40% operating margin, according to the company.

WeWork is shifting from leases to co-management deals. In this scenario, landlords might pay for the renovation and buildout of offices and/or split membership profits 50/50, similar to the management agreement popularized by the hotel industry. Neumann says WeWork has followed this strategy nearly 100% of the time in markets like India and Israel.

In cities where there are numerous WeWork locations, each additional location serves to drive down membership churn. Artie Minson, WeWork’s former COO and current President, has noted, “in cities where WeWork opened more locations, membership cancellations declined.” While the vast majority of WeWork’s membership plans assign its members to a location, it does let members switch between locations.

First, it can quickly expand at scale, opening between 500K – 1M sqare feet per month. And second, it can design spatially efficient offices in non-identical locations. Both of these accomplishments rely on defensible strategic advantages, namely, a control of the complete building lifecycle and a mastery of data-informed design.

Why Amazon and Google haven’t attacked banks

Cloud spending by banks is expected to skyrocket. By 2021, banks globally are forecast to spend more than $12 billion on public cloud infrastructure and data services, up from $4 billion last year. By many metrics, the cloud business offers better opportunities to tech firms than, say, retail banking. Overall cloud-industry revenues are growing at about 60% year-over-year, Jefferies estimates. Meanwhile, retail-banking revenue, comprising products such as checking accounts and cards, at most big banks is growing at a fraction of that rate. And any real foray into banking or financial products could also entail substantial regulatory issues and expense.

Experts say Tesla has repeated car industry mistakes from the 1980s

Robots are supposed to allow production of more cars with fewer workers, but one ironic consequence of over-automation is that it can actually require more workers. Ingrassia and White report that GM’s Hamtramck plant had around 5,000 workers on its payroll in the mid-1980s, compared to 3,700 workers at a nearby Ford plant with many fewer robots. Yet the Ford plant was “outproducing Hamtramck by a wide margin.”

This kind of rapid iteration works well in the software industry because a programmer can change one line of code and then re-build the entire project with the click of a button. But physical manufacturing isn’t like that. Car design decisions have to be translated into physical tooling that takes months to build and fine-tune. And rapid iteration is a nightmare for suppliers, Shook added. “I talked to a supplier and asked ‘who’s your worst customer'” Shook said. “The answer was Tesla. How can you be a good supplier when you don’t know when you’re supposed to deliver?”

Free cash flow to whom?

Alphabet has 1,000 shares trading at $50. They buy back 100 shares for $500. They should now have 900 shares. However in their financial statements, it says they now have 1100 shares, due to 200 shares being issued to employees. Those 100 net new shares are worth $500, which we then subtract from the financial year’s free cash flow, to arrive at a new Free Cash Flow with Hypothetical Cash Compensation™ metric.

When a company’s share price is rising, prospective employees are more than happy to be paid in stock units that incrementally mature over four years. Companies with the best-performing stocks will be able to attract the best talent, which (all else being equal) should improve the performance of the business, and therefore increase the share price in a virtuous cycle.

But that cycle can effectively function as a type of confidence game as well. While it makes good times look especially good, it can make the bad times far worse. In a severe share-price decline, engineers will likely be reticent to receive stock-based compensation instead of cold hard cash, which would put pressure on operating margins and cash flow. And as share prices fall, companies would have to pony up more stock to provide the same compensation, and further dilute the shareholder base.

Air pollution kills 7 million people a year, WHO reports

Nine of 10 people around the world are exposed to dangerously high levels of pollutants that can lead to cancer and cardiovascular diseases. Air pollution levels were the highest in the eastern Mediterranean and southeast Asia, where in some areas airborne toxins were five times WHO limits and disproportionately affected the poor and most vulnerable. About 3 billion people are breathing deadly fumes from domestic cooking stoves and fires. Household air pollution caused an estimated 3.8 million deaths in 2016.

The Grumpy Economist: Basecoin

The Fed was founded in 1907 in part to provide an “elastic currency,” exactly the lesson missing from bitcoin and at the center of basecoin. Alas, the Fed trades money for treasury bonds, backed by taxes, not for Fed bonds backed by future seignorage. And laws against using foreign currency or issuing private currency help a lot. Basecoin buyers will soon learn the lesson that bonds cannot pay more interest than money in a liquid market, and that claims to future seignorage cannot back money in the face of competitive currencies.

Ray Dalio: An unconventional take on success

Everything I’ve done with a singular focus on economics has fallen short. Everything I’ve pursued because I believed in the intrinsic value has exceeded expectations. Assessing a business based on unit economics is especially popular today. But a durable competitive advantage comes from the value it creates for its stakeholders. If you get that right, the unit economics will follow. Economics is not always an accurate reflection of intrinsic value. The same can be said of a career.

Regional Notes 2018.05.04

Malaysia vote battle heats up with focus on jobs for young

The jobless rate “hides a lot of unpleasant things in the labor market: low pay, low productivity, low skill and a high number of foreign workers,” Zakariah Abdul Rashid, executive director of the Malaysian Institute of Economic Research, said at a conference in Kuala Lumpur in April. “Those unemployed are the youth, highly-qualified individuals who can’t get jobs.”

Foreign labor has underpinned that rebound. The central bank estimates that about 82 percent of the net jobs created in 2016 went to non-residents. Unemployment among 15 to 24 year olds stood at 10.8 percent last year, according to the World Bank, while joblessness among local graduates has increased more sharply than non-graduates since 2011, data from the central bank shows.

Documented overseas workers accounted for 12 percent of the labor force last year, after a steady decline from 16.1 percent in 2013, according to central bank data. Still, adding in the unregistered workers may boost the total amount of foreign labor to as high as 40 percent according to some estimates.

J-beauty: Japan’s sleeping giant awakens

The sleeping giant of the beauty industry, “J-beauty” has woken up. Long eclipsed by the success of K-beauty, the $13bn South Korean business built on insatiable demand for innovative sheet masks, snail extract creams and convoluted skincare routines (most recently resulting in Unilever’s purchase of skin-whitening brand Carver Korea for €2.27bn), J-beauty, its older, more sophisticated sister, is now re-entering the spotlight. The Japanese business has benefited from the growth in Chinese tourists, following limits imposed on travel to Korea by the Chinese government and a surge of enthusiasm for the Olympics in 2020. Japanese beauty exports are tipped to exceed $2.75bn this year.

As Okabe puts it: “K-beauty is driven by trends, it meets those tentative needs of the consumer which are hot or of the moment, whereas J-beauty is something far more sustainable, authentic and eternal.” While J-beauty can’t possibly compete with the entrepreneur culture of Korea, which has the manufacturing speed and efficiency to bring cutting-edge trends to market quickly, K-beauty can’t compete with Japan’s far more delicate and intricate beauty rituals, their obsession with beauty (Euromonitor reports that Japan has the highest per capita spend on skincare and cosmetics) and their long-term investment in technology.


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SAP Has The Largest Cloud Footprint: Dilipkumar Khandelwal, President – SAP HANA Enterprise Cloud

“SAP has the largest cloud footprint today, with more than 100 solutions and 150M subscribers across industries globally which is enabling companies to innovate new edge scenarios to allow them to continuously adapt and advance.”

Dilipkumar Khandelwal, President – SAP HANA Enterprise Cloud & MD, SAP Labs India

In an interview with Sarabjeet Kaur from BW CIOWORLD, Dilipkumar Khandelwal, President – SAP HANA Enterprise Cloud & MD, SAP Labs India speaks about how SAP HANA cloud has accelerated growth and helped numerous Indian organizations innovate to quickly deliver business outcomes, reduce risk, and drive IT and business transformation. Excerpts:

BW CIO: Cloud computing is often considered as the backbone of digitalization. What is your outlook on this?

Cloud is absolutely the backbone for the digital transformation of enterprises. Innovation is the top priority for most enterprises today to grow and remain competitive. Indian organizations are transforming at a rapid pace, but an increasingly connected world is creating new demands which has led to numerous new questions on data, analysis, automation and security. Cloud computing is the solution for organizations to scale, secure, analyze and store data while lowering operational cost and improving business agility. To digitally transform without cloud infrastructure is unthinkable.

BW CIO: What is the contribution of SAP cloud environment in accelerating digital transformation in India?

SAP understands that today’s businesses demand more flexibility and speed than ever before and empowers enterprises to transform with its cloud solutions. SAP Cloud Platform creates an agility layer that allows businesses to manage and leverage information of all types and connect it to business systems. SAP Leonardo is the digital innovation system that combines design thinking services with platform capabilities of cutting edge technologies. With SAP Cloud Platform as the foundation of SAP Leonardo, our customers and partners are seamlessly integrating technologies such as IoT, machine learning and blockchain and capabilities such as user experience, business services to rapidly develop and deploy next-generation applications.

BW CIO: What are some examples of SAP’s constructive business use cases?

SAP cloud solutions have transformed Indian businesses to run in real time, providing the ability to transact, analyze and predict instantly and proactively in an increasingly unpredictable world. A few companies that SAP has empowered are –

  • Celkon Mobiles has implemented SAP's cloud platform to aid its national distribution network. The solution has been implemented across Celkon’s more than 700 channel partners and employees and is expected to reduce data loading, improve sales, capture the company’s data efforts, eliminate duplicate transactions and improve the efficiency and accuracy of information.
  • Mangalam Cement was looking to Gain Operational Efficiencies with SAP S/4HANA Enterprise Management and deployed the SAP S/4HANA Enterprise Management solution at 6 plants, 2 captive-power plants, 13 windmills, and 55 distribution centers.
  • The British Grand Prix racing and automotive manufacturing McLaren is using SAP, including SAP HANA Enterprise Cloud, to design cars faster, deliver applications from the cloud, and recruit the best talent.
  • Metinvest leveraged the SAP HANA Enterprise Cloud as part of its digital transformation process. By using SAP, the mining & metals company is saving $17m annually through more accurate production planning, automated invoicing processes, and improved employee management. Metinvest is more flexible and closer to their customers.

BW CIO: What is the growth outlook in cloud services solutions?

Gartner in a study forecasted that the worldwide public cloud services market is projected to grow 21.4% in 2018 to $186.4 billion, up from $153.5 billion in 2017. Additionally, the fastest-growing segment of the market will be cloud system infrastructure services (IaaS), which is forecast to grow 35.9% in 2018. This data clearly shows that cloud solutions are evolving rapidly and showing no signs of slowing down. The main reason behind the growth is the architecture which is desirable to businesses and delivers a strong return on investment. Several businesses are already using cloud technology in a public, private, or hybrid cloud environment and the pace of cloud adoption will only quicken in the years ahead.

BW CIO: What is the next phase of cloud evolution?

Businesses are evolving faster than ever before by adopting cutting edge technologies like AI, IoT, Blockchain, etc. Cloud computing is key for these technologies to achieve their full potential and it has become a natural part of how any business thinks about transformation. While many would say cloud computing is a mature technology, I believe it’s still evolving as new trends emerge and usage patterns change. Though Indian enterprises are growing rapidly, there are still many organizations that are yet to migrate to cloud completely. Additionally, many industries are still at a nascent phase which will take time to evolve and adapt.

Around The World

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Aldeburgh – a tailer’s view

6:45am: turn off alarm. Check memo: first-aid kit! Phone: no message – ride is on. Breakfast then head to Ely ahead of 8:30 start

Six bikers and one pillion gather around Janet for her briefing. My first time tailing so I listen intently. Then we’re off on roads still damp from overnight rain. Clouds temper the light & temperature: perfect riding conditions all day

The buddy system: from the rear I see riders adjust their speed to keep the bike behind in view. A turn of the head assures riders they’re being followed at junctions. Fuelling break in Coddenham and bikes swap order. The group are riding for each other and not as dispersed as on a Sunday ride. Kids wave as the seven bikes enter Aldeburgh in formation

Tailing duties complete (Catherine takes over for the return) – off to the fish’n’chip shop, which has only just opened but already has a queue. Lifeboats are launched as we relax on the beach

Janet Pinion’s 2019 all-day ride to Aldeburgh (began in Ely, ended in Fordham): right-click here (save as..) to download the route in .gpx format

Meldreth & St. Ives Shows

A heartfelt thank you to all those members who gave their time to make the CambsIAM stand at the Meldreth Show and St Ives Festival a success last month

CambsIAM was brilliantly represented at both shows, with swathes of brochures & flyers handed out to visitors and a healthy sign-up rate for the Taster-Ride Day event organised for the end of this month. All this is in spite of noticeably reduced attendance at Meldreth as a result of downpours overnight and during the morning

Thanks to: David Cowen, Paul Crinson, Garry Ellwood, David Hyman, Tom Jacobs & Keith Tremeer for transporting, erecting and manning the stand. Special thanks to Barry Dickinson and Andy May for coordinating whilst Catherine was away, and to Lynette & William Elbourn for storing everything needed at the shows

June ladies ride

The ladies – Catherine, Jacqui, Janet, Jo & Megan – met for the 2nd ladies ride of 2019, on the last Sunday in June. The sweltering heat of the previous day had subsided, thank goodness

Conditions were perfect for a bike ride: a cool breeze and uninterrupted sunshine. The ladies meandered along the lovely roads south of Newmarket, free of traffic early on a Sunday, to rejoin Cavenham via the single-track Icknield Way. The route continued past Stow Country Park and under the cool canopy of Elveden Forest. Would a muntjac jump across the road?

Refreshments were at the Café, Elveden Courtyard, a firm favorite for its scones, creamy scrambled eggs and delicious cordial drinks. A well-stocked farm shop offers the opportunity to buy fresh produce, and at least one of the ladies found something for that afternoon’s BBQ. Just make sure you take a top box or Kriega bag if you visit!

The return journey passed through Brandon, Mildenhall, Fordham, Wilburton,  Haddenham and finally Sutton, where Janet had prepared tea & cakes. After a relaxed rideout this was one last chance to catch up with one another’s news

Round Norfolk Charity Run

Our own Jason Wingfield is also a member of the Thetford and District Motorcycle Club, and would like to draw attention to the Charity Run this group will be holding at the end of this month. Money raised will go to Onward Enterprises to help them provide a realistic working environment for adults with learning difficulties

The flyer lists all the keys points – just contact TDMC for more details on joining the run or to make a donation

Ladies Cotswolds weekend

A small group of our female members recently took themselves off to the Cotswolds for a three-day biking weekend. Whilst there they teamed up with members of Cheltenham & Cotswold Advanced Motorcyclists, who took them on insiders’ ride through the backroads and picturesque villages of this lovely English region

Click here for more photographs and an account of their adventure

Hunting for Rickman

A retired Humberside Police Traffic Officer and fellow IAM member has been in contact with CambsIAM to seek your help as he researches the eighty Rickman Métisse motorcycles which entered service as police vehicles in the UK in the early 1970s – twelve of them bought by the Mid-Anglia Constabulary between November 1972 and November 1973

Cambridge 1973 – a Mid-Anglia Constabulary Rickman Métisse

Our fellow biker has put together detailed background reading on the unique story of the Rickman Métisse, its link with Mid-Anglia Constabulary and what became of the twelve used in our region. Click here to read more

Perhaps you recall these machines, or even have an photograph you’d be willing to share? Or maybe you even know the whereabouts of a Métisse? Just contact and we’ll put you into touch. All anecdotes, images & potential leads will be gratefully received

All-day ride, Sunday 9th June

Keith Tremeer will be leading an all-day ride through the backroads of Norfolk & Suffolk on Sunday 9th June. This rideout has been in the Events Calendar for a while, but Keith has now provided details of the route & timings for the day – these can be found here

All full members and pillion companions are welcome, but there will be a limit on the number of motorcycles. So if you’re free that day you’re encouraged check the ride description using the link above and contact Keith to reserve a place on what promises to be a fine outing

The White Horse near Badingham

An invitation from SAM

The IAM central England Spring Forum on 27th April was an opportunity for groups in the region to catch up with the latest developments. CambsIAM was represented by Chief Observer Graham Scott, who passes on an open invitation to all CambsIAM members to the Group Meeting of Suffok Advanced Motorcyclists on Tuesday 16th July

The meeting begins at 7:30 – after club formalities there will be a presentation by a staff pilot and doctor from East Anglian Air Ambulance explaining the work they do

The Ipswich-area venue (Gresham, Tuddenham Road, IP4 3QJ) has a bar serving all types of snacks, meals and drinks including teas and coffees – see the SAM events calendar for more details

First ladies’ ride of the season

Damp grey skies and a cold breeze were the backdrop for the first ladies’ ride of the season, which took place on the last Sunday of April. Well wrapped up & suitably waterproofed, we headed out on greasy Cambridgeshire roads in an easterly direction, passing through Kimbolton then turning right to Caxton, Old Weston, Clopton and Wadenhoe where we stopped at the Old Barn for scones and tea/hot chocolate

Warmed through, we left the car park following Janet Pinion for the return leg. Janet led us through the Giddings, Ramsey, Warboys & Bluntisham where (after another hot drink) the five of us went our separate ways. It was good to catch up and it was a great ride!

Image courtesy Catherine Ryan


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Assist A Tray

Canandaigua The Medicine Shoppe
About This Product
The Assist-A-Tray is a couch-side handle that makes it easy to stand from your favorite couch or chair. It comes with a convenient multi-use swivel tray so you can eat, surf the web, or simply keep handy items close by. And like all of our products, it blends in with your living-room (like another piece of furniture) so you can maintain the comforting feeling of your home.

Features & Benefits
Support Handle – Makes sitting and standing easy.
Swivel-Tray – Laptop/TV tray comes with a cup holder, utensil compartment, and swings out of the way when not in use.
Adaptable – Adjusts in length to fit either side of your couch/chair.
Super-Grip Rubber Pads – Ensures extra stability and protects floors against damage.
Low Profile – Matches look and feel of your home.
Lifetime Guarantee – If you are unsatisfied for any reason – we will fix or replace your product.

How We Compare
Canandaigua The Medicine Shoppe


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Photos from the 1950's

Recently Discovered

By David Bullock

I recently bought these old photos featuring Canvey Island in 1950 from an on line auction. They are both taken in the Labworth field, one clearly showing the Monico.

Photo:Labworth Car Park - 1950

Labworth Car Park - 1950

David Bullock

Photo:Monico - 1950

Monico - 1950

David Bullock

This page was added by David Bullock on 11/01/2012.

If you're already a registered user of this site, please login using the form on the left-hand side of this page.


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Good Masters & Sweet Ladies to Life!

Goals, objectives, and activities

Students in Grade 8 read the play Good Masters!  Sweet Ladies! in an endeavor to better understand the lives of average children like themselves during the Middle Ages.  They each take on a monologue to perform in order to gain empathy for characters who lived 800 years ago.  Students perform these for children in other grades and/or classes and then field a Q & A session that demonstrates their understanding of their character. While students have been completing this for the past three years, we have not had costumes to lend to the children, leading some students to be well outfitted from home and others to be in street clothing as they have had limited access to costumes. We wish to provide several costumes to help students have a better sense of character in their presentations.

How will the project be evaluated (e.g. how will you gauge its success)

Students will be scored using a rubric for their performances.  The rubric will include historical knowledge, presentation skills, and understanding of the text.

Benefit to the students and the school

When students dress the part, they are more likely to engage in their role seriously and with purpose.  Costumes are an investment that can be used again and again to reinforce differences and similarities between children of today and children of the past.

Budget (Please detail how funding will be used. Itemize as appropriate.)

Costumes from Medieval Collectibles:
Women- 1 medieval Lady Costume- 94.00
2 chemise dress- 27.00 each
1 lace-up gown-35.00
1 brown corset-10.00
1 maiden’s skirt-36.00
1 vest and cuff set- 27.00
Subtotal for women’s costumes (3)- $256.00
Men- 1 Lord of the manor costume- 42.00
1 brown monk robe- 22.50
1 armored knight- 150.00
Subtotal for men’s costumes (3)- $214.50
Total for costumes- $470.50 + shipping (?)

Timeline of Project (when will you do the project, if applicable.)

Project will begin in January and be completed by the end of the month. Costumes will be able to be reused annually, and with the merger with Harwich set to take place in 2014, costumes will serve a population of 150 per year.


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Warranty Information

We Provide our Buyers with a Builder’s Limited 10-Year Insured Warranty

Feel Confident and Secure in Your New Home

About Our Warranty

PWSC_Shield_Blue_cropAs a quality new home builder, Capitol Homes, Inc. is proud to offer our buyers the best warranty program available today on your new home. Because of our relationship with Professional Warranty Service Corporation (PWSC), we back our warranty with the strength of one of America’s largest insurance organizations.

Coverage Overview*:

Year 1: Workmanship and Materials
Year 2: Major Systems: “Inside the Wall” Coverage
Years 1-10: Structural Elements

Home Buyer Advantages:

NO deductibles.

Capitol Homes, Inc. provides our buyers with an express 10-year Builder’s Limited Warranty. Even in the unlikely event that we cannot perform our obligations under the warranty; our insurer will be there to assume responsibility for our performance…at no cost to you. Most other insured warranty programs require a consumer deductible, so even if your repair is covered, it still costs you money.

Our insurer is the strongest in the industry.

The PWSC administered program is underwritten by a member of Zurich North America, rated A+/XV by A.M. Best, one of the leading independent insurance company rating services.

Binding arbitration resolves disputes quickly and easily.

Capitol Homes, Inc. is proud of our customer service record, but should a disagreement occur, the PWSC program provides our home buyers with binding arbitration to settle disputes without costly legal services. The arbitration program allows an independent third party arbitrator to resolve disputes promptly and completely. Either party can request arbitration by submitting an $80 filing fee that will be refunded if they prevail. The process is binding and is enforceable in a court of law.

When you sell your home…

Should you decide to sell the home, the transfer in title will not affect the remaining term of our limited warranty. The homeowner simply completes the “Subsequent Home Buyer Acknowledgement and Assignment Form” found in the warranty document. This feature can be an attractive selling point at resale for homeowners or sales agents.

The combination of our customer service expertise, a clear and comprehensive warranty and the backing of one of the largest insurers in the country allows us to provide you with a level of security unmatched in the industry.

Contact us today for more information or for a copy of our 10-year insured warranty program.

*See the written limited warranty for full explanation of coverage

Have a Question? Ask Now!

Stay Connected

Customer Testimonials

Capitol Homes was able to give us the look we wanted without exceeding our budget. Our friends who have build custom homes told us to expect to go over budget by 10 to 20 percent … I say that should have chosen David Luecke and Capitol Homes. Capitol completed our new home under budget, and gave us more than we expected.Todd Kornblit


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Clinical Coordinator

4 - 7 Years

Job Description

Key Areas

1. Coordinating with CCEQ for continuous quality improvement
2. Intra and Interdepartmental coordination
3. Consolidating Quality Indicators
4. Conducting QIPs and Nursing Audits
5. Participating in relevant hospital committees
6. Enhancing error reporting culture
7. Establishing quality culture among RNs.
8. Performing daily surveillance related to the quality
9. Training and development if RNs
10. Credentialing and privileging of RNs.
11. Identifying the learning needs of RNs.
12. Developing, Reviewing and Implementation of policies and SOPs.

Desired Candidate Profile

Please refer to the Job description above

Company Profile

Ravindranath GE Medical Associates Private Limited (Global Hospitals)

Global Hospitals Group is one of the fast growing chains of multi super specialty tertiary & quaternary care Hospitals in India offering healthcare services of international standards. Conferred with many prestigious Health Care excellence awards and recognized as the most promising Healthcare chain in India, Global Hospitals Group, with over 2000 beds, has world class hospitals strategically located in the metro cities of Chennai, Bangalore, Hyderabad & Mumbai.
View Contact Details+

Recruiter Name:Madhu

Contact Company:Ravindranath GE Medical Associates Private Limited (Global Hospitals)

Not Disclosed by Recruiter

Functional Area

Employment Type

Permanent Job, Full Time


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317 IA, IC & Other Posts in LIC India Recruitment

Life Insurance Corporation (LIC) of India has recently published a recruitment notification for recruitment of the IA, IC, IAA & AFA vacancies in different regions.  Life Insurance Corporation of India, Maharashtra invites application for Insurance Advisor, Insurance Consultant, Insurance Agent cum Advisor & Agent cum Financial Advisor posts for Nanded, Latur, Sangli & Thane District.

If you are eligibly for the post, you may apply for the posts. Read the full LIC India Recruitment below before apply the posts. Eligible candidates may send their applications on or before last date.

Further Job Details like age limit, qualification, application form & selection process how to apply for the LIC India Recruitment posts are given below.

LIC India Recruitment Posts Details:

Sr. Post Name Vacancies Age Limit
01. Insurance Agent cum Advisor 200 Between 21-60 Years
03. Insurance Advisors 50 Between 18-60 Years
02. Agent cum Financial Advisor 35 Between 18-45 Years
04. Insurance Consultants 32 Between 18-60 Years
Total Vacancies 317

Eligibility Criteria:

  • HSC & Any Degree
  • Refer to Notification for Post wise details

Application Fee:LIC Recruitment 2014

  • No application fee

Selection Process:

  • Personal Interview

How to Apply:

  • Candidates are required to send their applications in the prescribed format along with all related documents
  • Send their application form to official notification address.

Important Dates:

  • Last Date for Receipt of Application Form: 30th April 2014 (For Other Posts)
  • Last Date for Receipt of Application Form: 31st May 2014 (For LIC Insurance Agent cum Advisor )

Important Links:

  • Website: https://www.maharojgar.gov.in/
  • Official Notification: Download Here (For Insurance Advisors & Insurance Consultants)
  • Official Notification: Download Here (For Insurance Agent cum Advisor)
  • Official Notification: Download Here (For Agent cum Financial Advisor)

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.


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House Health Business

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Why White Walls are a Bad Idea in a New Apartment with Kids

When you move into a new apartment or home, you probably recognize the tell-tale white walls that symbolize fresh, clean coats of paint. And, unfortunately, most apartment complexes are staunch in their allowance of new paint colors. However, when you have a chance, argue the following points to your landlord. Why? Because white walls are a bad idea in a new apartment, especially when you have young kids to tend to.

Dirty Fingerprints, Debris Stains, and Smudges

Young children have a habit of touching anything in their path, and white walls are no exception. Sure, those walls look crisp, fresh, and lovely now, but the end of week one will have manifested a bunch of new, sometimes obscure stains to grace your once-nice, once-white walls.

You Could Lose an Apartment Security Deposit

Unfortunately, apartment buildings paint their walls white, then fully expect people to not get a single stain on them. They often use services, like cleaning Minneapolis, to get the right tint of neutral, super-clean white walls. And, while that expectation is a good one for singles or tidy couples, families with small children might have a problem upholding the rule. Ergo, you lose your security deposit because your toddler decided to run his chocolate-covered fingertips across the hall border.

White Walls Must be Scrubbed Twice as Often

If you have the time, and the energy after dealing with your rambunctious bunch, then you should definitely strive to keep those white walls clean and smudge-free—but it will take twice the scrubbings. Bleach, baking soda, soapy water, and lots of elbow grease—these are the things you will need to restore a white wall to its former glory. And, even then, you might be able to see the residue of a toddler run-in.

No Creativity in White Walls

White walls are stark and can be mind-numbingly boring and dull, which quashes creativity in a heartbeat. So, if you are rallying for paint choices to your landlord, suggest a soothing blue, or perhaps a woodsy brown. Those are the kinds of creative, but not crazy, colors that you and your family can plan your décor around.


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Carolina Boudoir

Showing you the sexier side of the women of the Carolina's. Offering the empowerment of women through photography.

Book Now

About Us

Welcome to Carolina Boudoir,

Where women can express how sexy, classy, and beautiful they really are. The Roaring 20’s truly started the art of boudoir photography. This style of photography has helped women gain confidence in their own skin for more than a century. Tim Hays, the owner of Carolina Boudoir has been in the photography industry since 2006 shooting weddings, celebrations, graduations, family photos, and more. Completing more than a thousand photoshoots, he decided to pivot his business and solely focus on boudoir photography.

Boudoir photography has an empowering affect on women because they don’t always get to see themselves in this light from day to day. It gives women the opportunity to be free outside of what they would normally label themselves as the mother, the wife, or the career women. Instead, they can see themselves as a rockstar. Throughout the entire shoot they’ll feel sexy and beautiful and be able to have these photos to last a lifetime.

Read More
Book Now

Experience Carolina Boudoir

The Session Before The Session

Getting to know you before your shoot helps us learn more about your vision, expectations and unique style.

We hold a meeting with each client beforehand to discuss ideas and we try to accommodate busy schedules by offering the meetings via phone.

Contact us today to schedule your 30-minute Pre-Shoot Meeting via phone or in person.


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Hunter Huss Plans To "Stick It To" Defending Champs

Hunter Huss Plans To "Stick It To" Defending Champs

GASTONIA --The unbeaten Hunter Huss Huskies may have their work cut out for them when they host the defending 3A State Champions, Charlotte Catholic, tonight in the third round of the playoffs, but don't expect the team to come out sluggish, said coach Jamar McKoy.

"We've told the guys that they (Catholic) are a traditional powerhouse school, but other than that, we are just going to lineup and play Hunter Huss football," McKoy said. "We want to get out and attack Charlotte Catholic and prove that our offense is one of the best around."

Last week, Catholic scored five times against Monroe but suffocated the offense, securing its ifth shutout of the season.

Huss, who is averaging 37 points per game this season has six shutouts.

"Our defense has overshadowed the offense all year, and that's fine," McKoy said. "We are excited to play a big ball game tonight.

Tonight's game marks only the third time in Hunter Huss history that they've made it to the third round.

"This is the fourth quarter and the kids are ready to roll-and-roll," McKoy said.

The game can be heard, locally, on WGNC AM 1450/ 101 FM. It will also be streamed live on the Carolina Sports Link.

Jim Mojo Morrison has the call starting at 6:30 pm.