the big Q meets the big A

I really need some creative release. While one of my collegues for searching for a job, she came across this start up company on a job portal trying to be really cool. They posted this job posting which got me interested. I might be just the right guy for the job. The job description fits well. Marketing sales distribution financial services are the correct key words. She applied online only to get an email from them, asking for answers to longwinded questions. What does a man need in life except a challenge? So I decided to answer these friendly blokes myself. It’s nice to do interviews when you are not really looking for a job isn’t it?

So here is the mail I sent them. The Q are the questions they asked and the JD: precedes the answers I wrote. I myself was surprised by the wisdom I exhibited in some answers. Some of them were so deep. They also helped me clarify my own thoughts on some topics. The best part about this is that it is all true, or what I believe to be true
Don’t get me wrong. This is not one upmanship and I really think the guys are genuinely trying to do something different. It’s good for them. Boring stuff gets you boring results. I hope they get some good guys frustrated by trying to beat the systym that is tacked against them.
So if the interview guys actually read my mail and looked me up on google… here is a big thank you and kudos from me.
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The answers:-
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I am tired of inane disclaimers that financial service companies throw at customers at the last; that to in illegible fonts and if you are on the radio, at incomprehensible speed. May God make you big enough one day to inflict the same on others. In other words (duh) may you grow to spend money on above the line marketing.
Disclaimer: a cocky tone with the backing of seed investors (other people’s money) probably appreciates or expects one back…

QUESTIONSQ1 Have you been in a financial products distribution role before? Yes/No

JD:
Oh you betchya…

Q1Y If you answered “Yes” to Q1, then please tell us more. Anillustrative list is -- the kind of product, the distribution channeldetails, the turnover (+ the growth attributable to you), theincentive structure (for you as well as your distribution channel),any extraordinary achievements/contributions (e.g. record breakinggrowth, convinced a particularly difficult but important customer(s),new/innovative ideas you contributed) + any other detail you thinkrelevant.

JD:
I was in looking at Mumbai and Pune as a territory for selling online trading accounts years ago. October 00 to November 01 to be precise. Those numbers were gobsmacking awesome. Oops, did I use a hyperbole. Retract – rephrase – Compared to today’s day of lakhs of account I could only manage a couple of thousand. We weren’t a startup driven by racking numbers to please a seed community. We were owned by a shrewd seasoned business man who only threw money after you got money in. So with a limited sales force and a deeply immature market, that was industry shaking. To give you a perspective, google was just about more than a Stanford project at the time.
Selling internet broking was tough – Sensex was at 2k and internet was the haven of fraud (at least in the customers mind) and to add to that, our dear Mr. Ketan Parikh, decided to play party pooper. You know the guy?
Let’s get back to numbers – our trading volume around the time was 5 cr a day and I was directly attributable to around 3 cr. Not bad considering we had an ‘all India’ presence. But then, was that my over performance or the other idiots at the branches just decided to sleep on their jobs. The Bangalore guy was called Mr. NASDAQ as he always ambled to office at around 12 noon.
Difficult customers were part of the party. If you think difficult customers who were on the threshold of joining are painful in financial services, you aint seen nothing yet. Wait till they join and make a few losses, having their margins cut in a fall and now try recovering money from a dude in bhayendar, who happened to be the local NCP rep. Oh, does that mean I did that. You bet I did. All of the above to multiple people and yes, the bhayander story is true. Now that you reminded me let me dig up that card. I’ll probably frame the dam thing. An, numbers again – the recovery from the NCP guy was around a frightfully low five grand.
Innovative ideas bit – lotsa – we wanted direct sales agents. One poor guy walked in from Pune to start a broking coaching institute. I made him the largest sales agent in India. He is still a large guy there. Now I can happily give you his reference. A year into the job then, he might not have been a happy reference.
Then my company did the silliest thing they could. Took me out of sales (a promotion they told me) and put me in centre. Wow. Now I looked at broad sales strategy (fart), marketing (more fart), product (loud fart), customer service (fart of the highest order) and corporate strategy (beyond just fart). Hung around for a couple of years and left. Did some nice things. Conned a few websites into paying per lead generated. Those were the days of cost per thousand impressions. Google was in its nappies remember, and they hadn’t yet plagiarized the adword model yet.
Got customer service up to mark. Did simple things like design and implement software to track and manage queries as well as – wow – classify customers into buckets based on trading volume. I practically ran out of the cabin naked, shouting Eureka, eureka…. Good thing they don’t have bathing communes in fashion these days. But what’s so hot about implementing a software? Loading a CD can’t be that much tough. Errr… this is the embarrassing part. We decided to build this stuff in house. Ya… I know… my sympathies with me as well.
Incentive structures in those days for the core team was not directly variable a math model. The company made money and hopefully end of the year, they like you enough to give you a bonus. For the direct sales guy, it just was a cash incentive. Innovative stuff was done there in the form of mid month 3 day schemes to get rid of month end bottle necks and stuff like that. Nothing rocket science but a staid financial service firm like ours… boy was that tough getting through.
Record breaking growth – you tried a nice one on the percentage versus multiple growth bit “fairly frightening habit of looking at targets as “Multiples” rather than “Percentages””. Very cool line but would fail to impress anyone who was worked in a fresh company in a fresh industry. Of course you grow in multiples, that too monthly. You have a ridiculously low base. Are any of you the hallowed IIT IIM combos?

Q1N If you answered “No” to Q1, doesn’t matter (well, it might perhapsmatter, but not very much). Please tell us your approach on creating,nurturing and growing a financial product distribution channel. Pleaseremember that on a “Ceteris Paribus” basis, good ideas can be worth asmuch as (if not more than) good experience.
Two hints for you in this connection. The first hint -- our ad clearlymentions that like most startups we too (though we have a Seedinvestor in place) are resources-poor; meaning no advertisement based(or other expensive) strategies or other expensive strategies please.Whatever money we have, we would prefer to spend it on your salary,the office overheads, and most importantly, our villa in Switzerland(just joking). The first hint – Though we are achievement-hungry, wedo generally tend to ignore strategies of the type “give me ‘n”people, each will handle ‘m’ customers, each of these customers doingon an average ‘l’ amount of business annually, so I will give you‘nml’ amount of business in all”! Mathematically impeccable but then…..

JD:Well all other things being equal, while pardoning the latin or is it greek translation, your question here indicates an answer that the earlier question fails to address. So here goes nothing –
Why financial distribution, all channels follow the same logic. Plenty of hard work and sweet common sense. You keep the relationships equitable and work with the partner, you got it going. The amount of consideration that is typically the bone of consideration (eeks, bad English), roots from an imbalance created from an understanding of power. To make things simple –if the distribution owns the customer, you pay high; if you own and hence pull customer – you pay low. To validate the hypothesis, speak to your nearby kirana.
And as far as hiring people goes, it works directly in proportion to the investment you think your firm can afford. People always work well in sales. Feet on street is well – feet on street – forgive an other rubbish aphorism. But if you are like my super boss who believes that, spend money only after you see money, good for you. I have seen enough to see that both strategies are great. Though for a start up that promises growth, stock, valuations and other scary words, conservation might not be the chosen path. After all the swiss villa is calling. And it’s never been cheaper. Thank you subprime.

Q2A As you know, the distribution of financial products is a fairlyfragmented business. There are the national level distributors andthen there are many smaller (but important in their regionnevertheless) players as well. Personal equations are important. Sohow would you assess your existing senior level (decision takinglevel) contacts among the financial products distributors to sourcethem for us? If you do not have any contacts (e.g. you are from adifferent line), then how do you propose to (i) create the databaseand (ii) also acquire the relevant senior level contacts

JD:Having databases is one the surest and smartest way to short circuit the growth process in this industry; but given the wonderfully inadequate innovation in this industry I an assuring you that these databases come with a heavy cost. The cost is invisible… the cost is the mindset of the guy who comes along with it. He comes with existing preset ideas (if you call them that) and the baggage of his current employment (promises made, big talk given).
In my experience if you have a kick arse idea and service, you need a fresh guy with eager brains. If yours is a me-too product, then hire the database.
A small part of my current work does work with people who have names of distributors, and they can be leveraged. But I still can’t fathom the need for this. This industry is small and fairly friendly. A few calls here and there will get you the list.

Q2B A linked question. Once you have the database + the contacts(either because you already have these or you acquire them somehow),how would you then go about keeping it updated?

JD:uhh. That’s a tough one. Will an excel sheet help?I also assume you have budgets for people to travel (not Mallya style of course) and for people to make calls. Is STD enabled on the cell phone? That would help for sure. A greeting card sent by courier might also tell you if the addressee has moved. See. Greetings cards always come with an ulterior motive.
(Is mallya one of the seed guys… then that line just got me screwed, metaphorically of course)
Ohhh now I get it. You were talking about getting more people on it. I must be so thick. .. But if that’s your core job, you kinda just do it. Right? You keep looking, you keep talking and you keep buying them off. The last is the worst thing and must not be done, but so is infidelity. Go on – remember ‘the tiger’. As in woods? Ahhh, my sense of humor must be sickening. Imagine having someone like me around your start up.

Hint:- Please keep the “resource-poor start-up” point in mind whileanswering either of these questions (Question 2A or Question 2B).
JD:Got that loud and clear. What you hiring morons that you need to repeat this stuff?

Q3 An easy question. Please tell us something about your sellingtechniques. The answer length is at your discretion. It can be onesentence or multiple pages (coherently written, of course). And by theway, no “cut/copy + paste” jobs from Phillip Kotler etc please.

JD:PERSISTENCE

I wanted to cut that at one word, but since I seem to be suffering from typititis, here is one cut copy paste from the dictionary. By the way, who’s that kotler chick. Haven’t met her? Does she do handstands? You sure, you not from some IIM?

Main Entry: persistence Part of Speech: noun Definition: steadfastness
Synonyms:
constancy, doggedness, endurance, grit, indefatigability, perseverance, pluck, resolution, stamina, tenacity
Antonyms:
idleness, indifference, indolence

Q4 You would no doubt recall from the advertisement that we arethinking of keeping a part (maybe a large part) of your pay asvariable (incentives disbursed on a monthly/quarterly basis as well ashalf yearly and annually). And that even bigger rewards can hopefullycome your way through stock in our company (amount of stock given isof course performance linked).So what are your salary breakup expectations with us? On one extremeyou could say 0% fixed and 100% variable. Shows a lot of confidence,doesn’t it? On the other hand, you could say 100% fixed and 0%Variable. Without getting into a judgmental mode, don’t you think thisshows a lack of confidence?

JD:Try and answer this
If there was a $100 bill lying on the ground and there were (A) Santa Claus, (B) A dumb blond, (C) The Easter Bunny, and (D) A confident bloke who agreed for fully variable pay standing there, who would pick up the $100 bill?

(B) The dumb blonde. The rest are all fictional characters!

Just pay a guy his true worth and let him overachieve for bonus. Bonus does not run the house. It helps you buy the second car, the club membership and if your company is really cheap – a pair of ray bans. Variable pay to fulfil basic needs is like keeping a dog hungry so that he does tricks with food as the motive when your friends come home. Zoo zoo. As another bad maxim goes – when you pay peanuts you get … yaa.. you know that… some one…duh… Monkeys!

-- Now that the two extreme points have been discussed above, pleasego ahead and let us know your preferred breakup in percentage terms(Fixed component vs Variable component).

JD:Go figure…
Good try on the mental marking though. Dan Ariely would have been so proud of you.--

Within the Variable component, what proportion would you prefer toreceive in stock basis and what proportion as incentives(monthly/quarterly basis as well as half yearly and annually). Theincentives are in concrete/hard money so that is the obviousadvantage. But on the other hand, the stock incentives can potentiallybecome “x” times (“x” being hopefully > 10K, we pray to God), so youcan retire as a Crorepati or as a Multiple-Crorepati. What would beyour preference?

JD:The more you break incentives into multiple months of shorter duration, the more you encourage short term behavior. People will sell the dream to get the best sales for now leaving your company with empty promises and bad reputation. So go, keep a plan in place to reward employees who stuck around irrespective of performance. If you are a start up, everyone there who trusted you must get their fair share. That’s the fun of being a family. Asking people to bet on something they don’t know is such a mean trick. Give them their due. Give them bonus for great work. And give them stock for being with you. So that they too care. If you keep giving stock that requires them to stick around in the future you might just get a whole bunch of people staying around not because they love the place but because they want the stock. I always get on board people who work because they want to not because they have to. And then reward them for working for you. Stock must not be used as a carrot but used as a means for showing you care. You care for your granny not because she has to make her will, but because you care. And if she puts you on the will along with another brother who visited her less than you, you don’t crib.

-- Please also let us know your earlier (existing job or last job, ifcurrently between jobs or unemployed) breakup in terms of Variable vs.Fixed.
JD:well if you do want to know – we have fixed pay and variable in a good year can be as high as x or as low as zilch like last year. Stock – this is a complicated thing, designed to confuse. We are the financial engineers you see.

Q5 How comfortable would you be as an one-man (or one-woman) armywhich is what you would be initially?While answering the above, please do remember that you are an integral(in fact, probably the most important) part of boot strapping thecompany’s growth so initially you may have to really go out (even alone) and get us the business (see Q2A and Q2B above). This is thefirst (and likely to be the most important) phase of your career with us. Once you have done this successfully, then comes the easier andmore fun part -- setting up the marketing department, having multiplelayers below you, multiple number of subordinates reporting to you,putting your feet up on the table while others go out and get thenumbers and generally basking in the gentle glow of your achievement(+ in the context of the incentives + stock options discussed earlier,watching your bank balance grow).

JD:Is this a trick question? Is this a Miss Universe contest? And what’s with the disclaimer after the question?

Q6A What excites you the most about this job opportunity?
JD:Another trick question… you guys are good. You hire a psychologist for this stuff? This time ask Miss congeniality. No, not Sandra Bullock, but then… you sure want a lot of bullock in any case… eeeeks another horrible use of the pun. Yeh bolne ke pehle main mar kyun hani gaya.

Q6B Conversely, what are your biggest apprehensions about this jobopportunity? Please do not write “none” or “nil’ or any suchequivalent word, phrase or sentence here. Please let us know at leastone apprehension -- unless of course you are a real-life edition ofthe emotionless “Terminator” robot in which case we will certainlykeep your CV on file for the future (in case we ever need your unique“Termination of Humans” services).

JD:Now that’s a good question. Give your psychologist a bonus for this one and your copywriter a kick for the ugly ‘terminator’ idea. It is so passé. You might as well have said ‘aasta la vista, baby’. Getting the monotone though aka arnie, might take some doing.So answering the apprehensions:-
Any guy writing the job requirement in this way either is too cocky or too egoistic or too fresh or a really cool bunch. One on four might not be a great odd. But the fear here comes in terms of large ego clashes which are typically responsible for the shit we see. Especially in start ups. I have worked in a few to see it coming. If you guys are good, which I assume you are, your biggest problem is ego. If it is a one man show, then even more so.
Other apprehensions
– Will my pay come on time?
– How big is my cabin?
– How come it’s smaller than his?
– How long before I get my secretary and my big fat company sponsored credit card?
– Where’s my car?

Q7 Any other points you deem relevant.JD:errr… melody itni choclatey kaise bani?In conclusion:-We are really looking forward to hearing from you.
JD:So bless me lord