All businesses are built from scratch. Some are built to be scratched out in no time, and some are built to last. Some last a few years, some decades, and some look as if they are forever—businesses that will outlive every generation that handles it. You and I included. What then is a resilient business? Old or new, resilient consumer-facing businesses seem to have that one trait in them that makes them last. That hunger to reinvent, and that hunger to stay relevant, original, inclusive and innovative for every time.
As I peek into the most recent weeks, a case in point is the ‘oldest-newest’ kid on the block in many ways, Reliance Industries Limited. A rather large kid to speak about, especially when you consider the fact that RIL became the first Indian company to hit a market valuation of $150 billion in the month of June 2020. When literally the whole world slept in the joint lockdown and focused attention around the pandemic, RIL emerged as a behemoth that had a lot happening. As many businesses wrote away the new financial year at hand as a break year, RIL cobbled together a whole new enterprise very few had heard about, Jio Platforms. A platform enterprise that has gathered for itself investment interest from 14 different players totalling all of Rs 1,52,056 crore.
Jio Platforms, a subsidiary of RIL, was established in November 2019, and has subsidiaries in the form of Jio Infocomm, Jio Mart, Jio Saavn, Radisys and Haptik. Simplistically put, Jio Platforms houses all the digital businesses of RIL in a debt-free shell. A shell that can then monetise itself by selling out shares in its future, as planned by a forever-on-the-move RIL. Jio Platforms aims to emerge as the biggest Indian digital services company that combines the might of Jio Infocomm with its other digital assets, procured and put together into a family of assets over a period of time.
This digital-assets house, married to the network of its telecom and bandwidth services play, married to Jio Mart, its e-commerce platform that aims to connect small retailers with consumers (that will cover grocery, electronics, fashion goods, eye care, pharma and more), married once again to a little bit of the ability of Facebook and Whatsapp, and the final game plan seems to emerge. A game plan for the future as a vision by the current set of 14 investors.
RIL, its Jio Platforms and its efforts with Reliance Retail are all clear-cut examples of how businesses are made resilient to withstand new times, new needs, new wants, and the completely new pressures that govern consumer markets. Mukesh Ambani (now touted to be the sixth richest person in the world) might as well have rested on the profits of the businesses handed over to him in the early days after the passing of Dhirubhai Ambani. It was still a big business. That was a crime of omission and commission he did not commit. Mukesh Ambani kept inventing and reinventing the game. Many wondered whether there was any method to the madness around. Disparate moves, a deep debt-book and sub-optimal results in many businesses (retail included) seemed to paint a fuzzy picture of the future. And then came the pandemic. The monetisation of Jio Platforms with 14 marquee investors.
Diverse sets of investors. Private equity players, digital biggies such as Google and Facebook, back-end logistics players and sovereign wealth funds included. And everything seems to have changed. There is certainly a time to build businesses, and a time to monetise them. Mukesh Ambani seems to have mastered this science to perfection. At this point of time, RIL is the classic example of a business that has forever been on the ball of consumer action of both the B2B and B2C kind. The company now has three basic platforms: The energy platform, the retail platform and now the digital platform most aptly named Jio Platforms.
Here is a company then, poised to leverage the future. A company that is making politically correct noises as well. Munch these from Mukesh Ambani’s speech at the 43rd virtual AGM last week: India’s largest and most profitable business. Made in India. With farmer-partnerships and partnerships with SMEs, merchants, vendors and start-ups of Indian origin. A two-third presence in Tier 2, 3 and 4 towns of India. A large generator of employment. What’s different in this model than the rest of what we see in organised retail? What’s different in this model from that of aggregated retail we are used to?
If you look keenly, there is one fundamental difference.
Out here in this model that has attracted so much interest, there is an effort to carry everyone together. The idea is to link small businesses seamlessly with consumers through the use of a platform and seamless technology. Marry it to social media and the power of WhatsApp, and what you have is inclusiveness at its broadest best. There are two kinds of businesses then. One that actually wants it all for itself at the cost of the ecosystem and existing players, and the other that wants a juicy piece of the action as it carries the existing ecosystem along to better efficiencies. Jio Platforms wins on that second count. If you have to be a resilient business, you need to have your act right. You need to be in sync with the mood of the nation. The need of the nation. The want of the nation. The desire of the nation. The aspiration of the nation. And most importantly, you need to know when to monetise what.
Harish Bijoor
(harishbijoor@hotmail.com)
Brand Guru and Founder, Harish Bijoor Consults