Small is not beautiful

One of the finest advices I have got when I was a fresh MBA aspiring to become an entrepreneur was from my young Visiting Faculty, Ravikumar who was a IIM(A) graduate.

"Raja, when you want to start a new venture, start something big. Never start something small. Many people think it worthwhile to start something small and then hoping that it will grow into a big venture. This is a myth as the dynamics of a small venture is totally different from the dynamics of a big venture. Also, the hassle once has to go through to start something small and big are the same. But more importantly, if something goes wrong with a big venture, the stakes of the stakeholders like financial institutions, partners and other suppliers are so high, that they just cannot afford to let you go down. But if you are small, they will be quick to cut the losses and move away."

I was reminded of this in this current financial crisis. When the small income individuals borrowed to set up a houes and couldnt pay the mortgage, the US Government turned a nelson eye on them, and let them be evicted. No one even shred a little tear for these poor individuals. But when the big guns like Goldman Sach, Merryl Lynch etc started going broke, the Goverment was quick to announce a bail out package of $ 700 billion. Bail out whom? Rich, greedy bankers who were less than prudent but who recklessly played around with investors money.

Small is not beautiful after all!