Apa lagi aku mau (2) - Rethinking priorities

1. So now, with personal net worth targets achieved, what then? That has come at great personal cost. But at the same time, it has taught me the valuable lesson of paying for wanting something. Would it then be desirable to pay for my children's education to get a feeling of self-worth? Or is that cutting off nose to spite the (abused) system? Where is the sense of nobility and pride?
2. So, then it is about having the comfort to do what gives personal happiness. Is it about raising children to their best potential? Is it about giving wife the avenues to pursue own trails - whether in career or in life? Is it about giving comfort to mother in her old years? Is it about clearing up all  outstanding items in life? Is it about not taking orders and being in a rush from day to day and assignment to assignment and fulfilling other people's priorities? Is it about taking one step at a time and smelling the roses, the coffee and whatever else? Or about focusing on what helps the community the best way that I can?
3. But how then do I square it with the materialistic dimension of making enough dosh to pay for all  that I wish to have? In short, how do I have it all?
4. A prologue to this is that we already have enough for our subsistence now. The next phase is about self-actualisation. Now I do need to decide who is in most need of this now. I can't be selfish and only think of my needs. Son needs dosh for his uni. So does daughter in just two years after that. I shall not touch the kepok as that gives the maneouverability for wife. 
5. Basically, if I were to step out and have my own venture, it should be making enough to cover for basic expenses. But I can't stop there as it needs to cover for educational expenses pretty soon too. So, the priority has to be calibrated right. Otherwise, it's replacing one misplaced priority for another.
6. Fertigation looks like a worthwhile investment to make now. As does gaharu. This should give some free cashflows over the medium to long-term at relatively low downside risk insyaAllah, but would need to be carefully monitored and cultivated to ensure highest premiums are secured. Other investments into equity and property will also need to be made.
7. In the meantime, need to chalk up the green company up pretty soon. Branding and finalising business model is next.
8. All this of course, subject to this not impeding growth and development needs of others.

Apa lagi aku mau?

1. Many events I went through in the last 5 years of a personal transformation plan created and executed back in 2007 has given me tremendous learnings and deep experience building on a personal scale. Some of the top of my head will be (i) societal biases (ii) personal priorities, leading to next steps.

Dasar Ekonomi Yang Lagi Baru?

1. Firstly, cutting off the sheltered world of low risk GLC job and entering a mad dog world of private sector. These are people fighting for their economic future, and they are not shy to use whatever they have at their disposal to obtain it. My perception - looking at the post GE13 trends for these people - Practise racism, but jump at others for doing it.
2. The economy is slanted towards Malaysian Chinese - no bones about it. Local blogs have been throwing the 90% tax indicator paid by Chinese - (no idea where this number came from given that Petronas is like paying the bulk of government revenues, and only 26% of the population are chinese. In which case, there's a whole lot of Bumis who are in poverty or non-tax paying population, and therefore a lot more work is required to alleviate this). My working experience in the private sector proves how painfully true this is. Need an external support, call up an external services provider for a quality and pricing that you want - and chances are the Chinese contractors / service providers will deliver. Easy way is to blame / point towards the superiority of the culture and mentality of one race over the other. The reality may not be so straightforward. I am more inclined to a policy of a selected meritocracy of Bumi service providers, a white-list perhaps of service-oriented Bumis, not rent-seeking Datuk Seris in their Beemers and Mercs wanting a slice of the budgetted allocation of a business. In anyways, there are already shameless non-Malay businesses who are learning the language of rent-seeking as the easy way out. Shame these unethical cultural problems, but do not tie this to the colour of a skin. 
3. So what of the DEB? Creating crutches or mollycoddling? The difference is with the application. Use it as sweeteners and refuse to allow the beneficiaries to raise themselves out of the mire, and the income gap and later the capability gaps will widen. The Malays have no other means to further themselves other than to work themselves out of the crutches and subsidy system. Anyone wanting to start a business - learn the ropes and then make sure that you choose the most rational choices you can, not the easiest ones. If you are capable, but still want to have the lot of the poor, shame on you too.
4. Malays in innovation sectors should be given support as these are the game changers. So, when GLICs are given an allocation, what should they do with the allocation? How should they invest? What is the long-term strategy to develop the malays? Or, are they the ones who are helped and forget about the rest?
5. To all intents, Ekuinas seems to be on the right track as regards to deployment of capital towards operational investment for the benefits of Bumiputras. Teraju is building a database of Bumi companies. How these certified or white-listed companies will benefit from the wider economy is still unclear. Just how do you mainstream the Bumi economy to the wider economy then? The creation of new ambitious businesses that build and thrive on the wider economy is needed. But again, the plan on paper is just so much easier than deploying the idea.
6. On a personal scale, the Malay entrepreneur needs to walk, talk and think as if he is a humble immigrant, and not to exhibit a distasteful ketuanan mentality. To get respect, you will need to earn it. Talk humbly, listen, articulate concerns well. Then, you may have a chance. Accept defeats, accept loss of face and do not be arrogant.
7. 
   

Biogreentech: engineering the systems to make it work

1. One way to engineer the whole biogreentech space to take on the established supply chains existing in the downstream petchem industry is to develop whole value chains to make it feasible in its later-stage commercialisation phase, assuming the technological hindrances have been ironed out.
2. Feedstock systems is one, biocatalysts is another. Market access. Capital and financing systems for scaleup commercial plants. Investors with patience to endure false starts, a few of them (investors and to minimise false starts)
3. Strategic investors are just too important to get this right, eg O&G NOCs or large plantation companies with large amounts of heft and willingness to forgo immediate returns for potential first-mover advantages. (though it seems setup that a follower model is perhaps a more prudent strategy to derive margins and build cost advantages - say the AirAsia model)
4. The high barriers of entry make it a small playground of players though. How do you make the risks seem insignificant to the benefits?

Biogreentech opportunities for Malaysia

1. Assessment of biogreentech opportunities

1.1 There are multiple pathways  for obtaining either drop-in biofuel or specialty biorenewables, the next step from the now outdated first-gen biofuel production of ethanol or blended fuels. The corrosive nature and the requirements for government regulatory mechanisms to create an artificial market has caused innovators to look at increased premium margins in eating into the lucrative downstream petchem applications.

1.2 Innovation in process flows looks at enabling production efficiency and effectiveness to give competitive advantages, although IPs are still a valuable source of building a competitive business model ala Lanzatech. For investors, it is necessary to validate claims of competitive advantages, as market domination of a particular biogreentech production material gives de facto or de jure standards to a market searching for an alternative to O&G dependence. Securing significant market access is good, and one that is not naturally dependent on an artificially induced market driven by government regulatory mechanisms and subsidies.

1.3 Having said that, at the infancy stage, it is perhaps impossible for alternative biogreentech products to achieve cost parity to that of the fairly established supply chain in using the conventional O&G pathways. Add into the mix possible lowering of costs with newer techniques of fracking for shale gas and the scenarios get a little bit dimmer. Supply side enhancements may keep oil prices within a lesser volatility range from previous decades arising from the changing geopolitical interests of the US. (ie I do expect the US to stop eyeing other oil-producing countries as military chessboards) Previous volatility at peak oil prices provided some impetus to the alternative markets and there will be some weakening of willpower to the 'alternatives' lobby. 

1.4 Having said that, the gas 'boom' driven by shale gas may actually assist KIOR, Amyris, Gevo(?) that can utilise cheaper gas to drive its production. Sensitivity may vary, as cost structure stacks up highly for the feedstocks, and the 10&-20% lower variation in gas pricing may not necessarily be an effective game-changer for the alternatives to lower product pricing and maintain much-needed margins.

1.5 Snide remark that it has been over 40 years of renewables lobbying to displace the oil majors, and the domination has been even more entrenched now that the oil majors have added their capacity to absorb variability in oil prices in maintaining supply to economic demand requirements. Won't be easy to displace the oil majors, eh? So, what was that with Shell co-investing in Codexis and then deciding it's no big deal to reprioritise when the macro-drivers change?

2. Regulatory story

2.1 The questions then are: how long and how much will it cost the government to maintain support before the alternatives gain self-sufficiency? Interesting that Bio lobby has bent over in praising the US Congress with whatever they are coming up with in terms of RFS, no matter how uncertain the regulatory outcome will appear.

3. Investing story, and national interests

3.1 How would a small, open economy deal with these changes? Government support should lrgely be based on economic growth driven by enhanced environmental sustainability. But that's too naive. Other economic spinoffs, multipliers need to be formulated before supporting these industries. What of potential benefits to existing corporate ventures, or NOCs?

3.2 It is quite possible that the innovations will continue and will come from the traditional powerhouses say the US due to ability to sustain the early-stage technological breakthroughs. The downside for say Malaysia is how do you then tap into that market while incurring increased risks of currency outflow, potential limited displacement capability wrt O&G downstream industries, feedstock supply and pricing issues and even in the case of Gevo, scaleup technology risks?

3.3 It is quite possible to look at the investments and come to a conclusion that NOCs are the only sort of players able to undertake the huge capacity and financial risks in this sort of venture, leaving the VC/PE investor as the means to access and assess the feasible biogreentech venture for the NOCs to consider.

3.4 Then it comes to what sort of IRRs will make sense, in light of potentially lower or stagnating suppport for these industries. What sort of capacities are required to bring these investments to commercial markets? In the current depressed state of the advanced biofuels share prices due to a lack of direction from the US regulators, shouldn't this be an opportunity to advance using the depressed pricing by averaging down costs, or is this doubling-down potentially giving the investors an even more severe outcome than what it is currently?