They dream big and change

businesses and peoples’ lives

Amarjeet Thakur

Senior Associate Vice President, Marketing Communications

Mirum, India

Amarjeet.Thakur@Mirumagency.com

“The horse is here to stay but the automobile is only a novelty—a fad.”

Advice from a banker to an original investor in the Ford Motor Company

As we look back in time, there are many examples of visionary thinkers confronted by naysayers with myopic vision. But the true visionaries ultimately could prove the effectiveness of their ideas with statistical measurements—production cost, consumer demand, incremental growth, bottom-line profit, for example.

In the absence of such data, how do we evaluate a business and arrive at a valuation? This challenge has become even more difficult over the last two decades, when we have seen new business models taking shape based on innovative technology and the service-sharing economy. The traditional metrics don’t always apply.

Consider Tesla, which sold less than 80,000 cars in 2016, but is valued at around $50 billion, more than Ford and General Motors, which sold several million cars in the same year. Uber, once valued at almost $70 billion, does not own a single taxi cab.

Airbnb, which owns no real estate, is valued at roughly $30 billion, higher than Hilton, Marriott, and the other global hotel chains. In the Indian context, consider the e-commerce site Flipkart, valued at around $12 billion, even after posting a significant loss.

Agreed that all these brands, have a strong financial promise, but that doesn’t justify the over-the-top valuations. There must be something more than just the financial bottom lines and projections that is making these brands so valuable.

On a mission

To understand what makes them so special, we need to look at their mission statements. Tesla promises to accelerate the world’s transition to sustainable energy. Uber wants to make transportation as reliable as running water, everywhere, for everyone. Airbnb wants to help create a world where you can belong anywhere. Flipkart wants to provide its customers a memorable online shopping experience.

And herein lies the answer. These brands promise us a better life… a better future. They are letting their consumers experience the promise through their products and services. And, more importantly, they are in sync with the needs and aspirations of the young generation.

When the traditional business metrics cease to make sense, the emotional appeal takes over. The valuation today is driven by the vague and lofty goals that are arousing consumer emotions. If you analyze these brands closely, they share a lot of characteristics, which are worth emulating and are reflected in these actions points:

Be the change These brands don’t ask people to change, but they are themselves the change.

Be passionate The founders of the brands are passionate about what they do.

Dream big They are not afraid to dream of a Shangri-La.

Do good They want to simplify and enhance people’s lives.

Involve customers They are in constant touch with their customers. Loyalty is paramount.

Romanticize the brand story They all have an emotional, human backstory about how it all began.

A brand is meant to be bold, even larger than life, because otherwise there would be nothing much to look forward to. Today we have dreamers who want to make a difference… to be the change themselves. And who doesn’t love a dreamer, even if the product comes with a hefty price tag.