Interaction with a Swedish Investor and a Nepali media CEO

here are the transcripts of the last thursdays series of the Entrepreneurs for Nepal group in September. It is based on an interaction with a Swedish investor and a nepali CEO.

Jonas Lindblom (Swedish Investor in Nepal)

“The market in India is very complicated and it is difficult to do business there. There are many middlemen in India and various agents are involved in almost every sector. But in Nepal, it’s simple. There are few people in entrepreneurship and everyone knows each other. Nepal is simpler for a foreigner like me and its way too easier to do business in Nepal. That’s why I came here,” said Swedish entrepreneur, Jonas Lindblom.

Lindblom is running two companies in Nepal – Artamus Nepal (P) Ltd. And L&L House of Commerce (P) Ltd.

Artamus Nepal focuses on Internet Marketing for European clients and L&L House of Commerce is a trading and investment company. The latter company focuses to introduce high quality products from Scandinavia and export unique Nepali products to the European market.He shared his ideas about investing in Nepal from a foreigner’s perspective here during September’s Last Thursdays Entrepreneurs Speak, jointly organized by Samriddhi, The Prosperity Foundation and Entrepreneurs for Nepal.

Lindblom believes that any organization should expect return not before at lease two to three years. But in Nepal, people want to reach breakeven point after five to six months.

Lindblom has started different business together with his family. They have continued to invest in different sectors like coffee, IT, cosmetics, import and export. Due to good networking, they were able to combine Swedish businesses and became good partners. He feels that companies of Nepal are small so they need to work together otherwise they cannot succeed.
His other company, LnL is a trading company. It concentrates on branding cosmetic goods under the brand name of Isadora.

Why Nepal? He answers that the market here is cheaper. Although Indian market is cheaper than Nepal, their market has more challenges. People need to be convinced and for that it takes time.Lindblom judges that eradication of corruption and political violence will help Nepal achieve the prosperity enjoyed by Switzerland, and he sees Nepal as an asian Switzerland. He believes the market of Nepal is expanding and brand awareness among people is gradually growing. He also recommends that since Nepal has a very small market it is a perfect situation to use the blue ocean strategy. He gives the example of Tata Nano as a typical blue ocean strategy motivated product. Tata Nano has its own market; they have the whole Blue Ocean for themselves: i.e. no competition yet. No other car companies enter their market; a perfect example of moving away from the competition and creating own market value.

Lindblom says entrepreneurs of Nepal are facing difficulty mainly due to miscommunication. So, he suggests trying to place oneself in other people’s situation so that we can understand the point of view. Comparing Swedish people to Nepali, he finds Swedish people more direct. He feels that Nepalese have a tendency of beating around the bush until finally they get to a point. This kind of uncertainty is what he thinks a lot of Nepali business people have to deal with.

Answering the question on how to bring back people who have left the country, he gives example of India. He thinks that joint effort between government and private institutions can create an environment where there is possibility of people coming back. “They use word consensus but there does not seem to be any compromise,” laments Lingdlom.

“Indians are coming here and investing then why can’t Nepalis?” he questions. He suggests that “We only have to make a focused strategy and come up with special schemes for them.”

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Ashutosh Tiwari (CEO of Himalmedia)

As the CEO, Tiwari’s priority at Himalmedia was to turn around the company both operationally and financially.

Leading a team of senior managers to focus on the results, he accomplished the turnaround task in 20 months, though he admits that any business is always an unfinished business, and that much work remains to be done in any business at any given time for further success.

Over a period of 14 months, he also negotiated with two Labor Unions, one of which was violently hostile. On one day in December 2008, the national members of the violent Union stormed into the building and physically attacked Tiwari and his editorial and marketing colleagues when they were having a weekly corporate meeting. “Had ours been an instant noodles company, perhaps nobody would have cared as much about the attack. But the attack on a media house and on journalists such as Mr. Kunda Dixit was nationally and globally condemned, and that backlash hurt the attacking party.”Tiwari lamented that the process of turning around the company inevitably meant letting go of some competent and
loyal staff since the management was not in a position to raise salaries and benefits. The survival of the company was at stake.

“When asked to leave, one staff member said that he would commit suicide,” shares Tiwari. “The staff members asked to leave were understandably angry and emotional. The pressure on me was enormous. But I couldn’t take it all personally, and I couldn’t also let it all get to me. I had to be calm and focused to be persuasive, sympathetic and persistent – all of which I found difficult to do at times.”

Tiwari thinks that most trade unions are good; but some of their leaders are cunning politicians who use every means to advance their own political careers at the expense of hapless and clueless private sector owners and managers. The demands of the trade unions should be, he says, in line with Nepal’s labour laws. He said that with the support from the Himalmedia Board and the remaining staff, he let a total of 60 staff leave the company with generous severance packages and as humanly as possible, helping them with job searches, reference letters and networking calls on their behalf. “I had never worked directly with labor unions before, so dealing with them from start to finish in this case was an experience which tested me as a manager every single day” he shares.
Due to his regular and good communication with the staffs, it became easier for him to complete the mandate given by the board. To win staff’s trust, he would often hold several meetings, be persistent about getting the results and make things clear and transparent to staff.As a CEO, he says that managers need not be defensive or even go on offensive. “Managers get defensive and are easily agitated when labour union leaders start thumping their fists on the table. Often, a manager’s anger,
impatience and immaturity make an already bad situation even worse.”

“Play straight, and stick to what the labour laws say” opines Tiwari. “You do not have to like the laws. You just have to follow them so that your position as a manager is legally and morally explainable when it comes to negotiating with Union leaders,” he says. Tiwari says that he believes that any success is only up to a point, and to keep on succeeding in anything, you have to keep on working hard and push ahead.