Category: Uncategorized

By Mo Fakhro

Much of the discussion around business success is framed as a choice between competition and monopoly. It is a convenient way to think about markets, but it obscures the more important variable. In practice, profitability, margins, and ultimately valuation are not determined by the absence of competition, but by the degree of market share a firm commands. Markets reward companies that matter and quietly punish those that do not. It is not competition that destroys value, but obscurity.

Most industries do not resemble the textbook extremes of monopoly or perfect competition. They exist instead along a continuum in which firms capture varying shares of demand. As market share increases, a series of reinforcing effects begin to take hold. Pricing power improves, unit costs fall through scale, brands shift from being options to defaults, demand becomes more predictable, and competitive behaviour becomes more disciplined. Margins improve, earnings stabilise, and valuations rise accordingly. These effects are not linear. A firm with 40 percent market share behaves very differently from one with 10 percent, even though both technically operate in competitive markets. This is why market capitalisation correlates far more closely with share of market than with abstract ideas about market structure.

The world’s most valuable companies illustrate this clearly. They do not operate in empty fields, nor do they rely on the absence of rivals. They operate in highly visible, competitive markets while commanding dominant shares. Microsoft dominates desktop operating systems despite intense competition across software. Alphabet retains the majority of global search traffic despite constant challengers. NVIDIA competes with other chipmakers yet controls most of the market for advanced AI accelerators. None of these firms are monopolies in a strict legal sense. What distinguishes them is that they capture a disproportionate share of usage and revenue in markets that are large, visible, and economically significant. Their valuations follow naturally from this position.

A particularly clear illustration of market share translating into value comes from the oil industry. In 1949, J. Paul Getty paid approximately $9.5 million for the right to drill for oil in the northern corridor between Saudi Arabia and Kuwait. At the time, oil markets were relatively competitive. There was no cohesive producer cartel, pricing power was limited, and future revenues were uncertain. Adjusted for inflation, Getty’s purchase would be worth roughly $120 million today. Those same oil fields now generate operating profits of approximately $7 billion per year. Using Saudi Aramco’s market-quoted price-to-earnings ratio of around 16, one can infer a present-day market value of roughly $112 billion for that asset alone.

What changed was not the oil underground. What changed was market share. Through OPEC, producers consolidated control over global supply. That concentration transformed oil from a competitive commodity into a market governed by pricing power. Extraction costs for these fields remain low, roughly $15 to $25 per barrel, while oil sells for $75 to $85 per barrel. The value of the asset lies entirely in that spread. If oil were forced to sell at marginal cost, the asset’s value would collapse regardless of how efficiently it was drilled. The same resource, serving the same customers, became vastly more valuable once producers controlled enough of the market to influence prices.

The same logic applies to modern technology markets. NVIDIA’s GPUs function as the oil fields of the artificial intelligence economy. The cost of manufacturing a chip has not increased proportionally with its selling price. What has changed is that NVIDIA controls a dominant share of a scarce and essential input at the precise moment when AI has shifted from experimentation to infrastructure. This position allows NVIDIA to generate net profit margins exceeding 50 percent of revenue. As demand for AI compute has become increasingly inelastic, pricing power has shifted decisively toward the supplier with scale. NVIDIA’s valuation reflects not only growth, but the market’s recognition that it controls a critical bottleneck with global reach. This is not monopoly in the abstract. It is market share expressed through margins.

Competition does not preclude profitability when market share is concentrated. Coca-Cola and PepsiCo compete intensely, yet together command a large majority of the global carbonated soft-drink market. Their rivalry is continuous, but demand is concentrated. Margins remain strong, brands remain durable, and valuations remain high. Competition in this context does not destroy value because market share is not fragmented. Rivalry exists within a structure that preserves pricing discipline.

The contrast with industries where market share is diffuse is stark. Airlines generate enormous revenues, yet even the largest carriers command modest shares of total capacity. Switching costs are low, routes are contested, and price competition is relentless. The result is thin margins and persistently low valuations. Construction is even more fragmented. Market share is spread thinly across many firms, differentiation is limited, and pricing is driven largely by tenders. Despite scale and experience, sustained profitability is rare. In both cases, the issue is not competition itself, but insufficient concentration of demand.

As one moves down the list of publicly traded companies by market capitalisation, market share tends to decline. As it does, pricing power weakens, margins compress, and investor confidence fades. Revenue on its own becomes an increasingly poor proxy for value. A company with five percent of a very large market can easily be worth less than a company with sixty percent of a much smaller one. Markets do not price activity; they price control over demand.

A useful illustration is Talabat, the Arab food-delivery platform. In some of its core markets, Talabat commands close to seventy percent market share. The total food-delivery market in the Arab world, at roughly five billion dollars, is a small fraction of the broader Arab economy, which exceeds two trillion dollars. Yet Talabat’s market capitalisation, at around six billion dollars, is greater than the annual revenue of the entire delivery industry in the region. What gives Talabat its value is not the size of the market it operates in, but the share of that market it controls.

New entrants often assume that by entering the same space they can capture some portion of that valuation. They overlook a basic but unforgiving reality: as market share declines, margins decline; as margins decline, profits fall; and as profits fall, market capitalisations fall with them.

The contrast becomes even clearer when compared with airlines. JetBlue, a U.S. carrier with a roughly 5% domestic market share and 1% of the global market share, generates almost $10 billion in annual revenue and operates a fleet of nearly 300 passenger aircraft. Yet, despite having almost $ 10 billion in revenue, its market capitalization is less than $2 billion. In other words, a company that operates a fleet of motorbikes—albeit a much larger fleet of around 160,000 bikes—is worth roughly three times as much as a company that operates hundreds of passenger planes.

This raises an uncomfortable but important question. Could a motorbike be more valuable than a plane? In theory, it can if the profit per bike is higher than the profit per plane, and in theory, that can happen if the market share of the bike is sufficiently higher than the market share of the plane.

Peter Thiel famously argued that “competition is for losers.” The statement captures the dangers of commoditised markets, but it overstates the case. Competition can be profitable, and even exceptionally so, when a firm commands meaningful market share in a large and visible market. There are numerous counterexamples. Richard Branson built successful businesses in fiercely competitive industries by accumulating reputation capital and market presence rather than avoiding rivalry altogether.

The more accurate lesson is that competition is survivable, but obscurity is not. It is therefore obscurity rather than competition that would make one a loser in the game of entrepreneurship. Markets do not reward firms for being alone. They reward firms for being large enough to matter. Valuation is not determined by the absence of rivals, but by the concentration of customers. In the end, capitalism does not punish competition. It punishes irrelevance. The winners are not those who avoid rivalry, but those who win it at scale.

By Mo Fakhro

Periods of upheaval invite simple narratives. When people suffer, the instinctive conclusion is that any change must be better than the current state of affairs. History, however, is far less forgiving of such assumptions. Iran today sits in a cauldron of economic pressure, social repression, and political rigidity. Protest is an understandable response. Unfortunately, though, the path out of the cauldron matters as much as the desire to escape it. In many cases, the exit leads not to relief but to fire.

What is often missing from the discussion is that every likely outcome of an Iranian rupture carries consequences that may disappoint its supporters and destabilize its neighbors. If protests evolve into a full-scale revolution, the most immediate result is unlikely to be democracy or prosperity. It is more likely to be a prolonged period of instability.

Revolutions dismantle institutions faster than they replace them. Bureaucracies stall, currencies collapse, security fractures, and economic life contracts. In such conditions, people do what rational people always do: They leave. For a country of Iran’s size and sophistication, this would not be a trickle; it would be a mass migration.

The Gulf states would be the most natural destination. Proximity, economic opportunity, and existing Iranian communities make them an obvious refuge. This, unfortunately, is where the first unintended consequence emerges: instability in Iran does not remain inside Iran.

Large, rapid inflows of people strain housing, infrastructure, healthcare, education, and labor markets. More importantly, they import unresolved political divisions and social trauma. Gulf states, already managing delicate demographic and social balances, would inherit problems they did not create and cannot easily neutralize. Paradoxically, a revolutionary Iran could then harm the very countries most opposed to its current regime.

For some Iranians, nostalgia has filled the void left by despair. The idea of restoring the Shah, or a monarchical system, is framed as a return to order, modernity, and global respectability. Nostalgia, though, is selective. A return to the Shah risks taking Iran from the cauldron to the fire. The grievances that fueled the 1979 revolution did not emerge from nowhere. Authoritarianism, inequality, repression, and elite concentration of power were not accidents but structural.

Restoring a monarchy, even symbolically, may recreate the very dynamics that once made revolution inevitable. It may offer short-term stability, but at the cost of long-term legitimacy. A society that has revolted once can revolt again, especially if it feels that history is being imposed rather than chosen. For Iranians seeking dignity and agency, a backward leap may prove as suffocating as the present.

Another imagined outcome is a post-revolution Iran that aligns closely with the West and Israel: Economically open, diplomatically rehabilitated, and ideologically reoriented. On paper, this appears attractive to external observers. In practice, it introduces a different regional complication. The Arab Gulf states maintain carefully balanced relationships with the West. These partnerships are rooted in security, energy, and pragmatism, but perhaps not ideological alignment. A newly rebranded Iran, positioned as a strategic Western darling and ideological equal, as it was during the time of the last “last Shah”, could disrupt that balance.

It would reconfigure alliances, shift attention, and potentially dilute the Gulf’s strategic weight. More importantly, it could force Gulf states into uncomfortable recalibrations by having to navigate public opinion, regional legitimacy, and geopolitical competition simultaneously. In such a scenario, Iran’s return to the global system does not necessarily strengthen the region but rather reshuffles it unpredictably.

A less discussed but increasingly plausible scenario is an Iran that abandons sectarian hostility and repositions itself as a non-threatening regional actor toward Arab and Sunni states. At first glance, this appears to be the most benign outcome of all. Yet here too, unintended consequences lurk. Today, much of the Gulf’s internal cohesion in political, security, and even ideological terms is reinforced by the presence of a common adversary. Rivalries among Arab states, differences in governance models, and divergent national priorities have been partially muted by the overriding Iranian threat.

If that threat disappears, then the unifying logic fractures, and what resurfaces are the underlying differences they had forgotten 47 years ago. What comes to the surface are competing visions of regional leadership and divergent relationships with global powers. Latent political and ideological disagreements long subordinated to the larger rivalry would also come to the fore. History shows that alliances formed in opposition often struggle in peace. When the external pressure is removed, internal contradictions come to the surface. Cooperation gives way to recalibration, and unity gives way to competition. In this sense, an Iran at peace with its Arab neighbors could paradoxically weaken the very cohesion that hostility once enforced.

The common miscalculation across all scenarios is the belief that removing the current regime automatically improves outcomes. In reality, civil unrest exports instability, restoration risks repeating history, realignment reshapes alliances in ways that may harm neighbours, and reconciliation dissolves unifying threats and exposes fault lines. None of these paths is clean, none guarantees prosperity, and none ensures regional calm. The protesters need to look no further than their parents and grandparents to understand how an ideological revolution in 1979 led to consequences that appear to have worsened rather than improved their lives. This does not excuse repression, nor does it deny the legitimacy of popular frustration. It does, however, challenge the assumption that collapse equals progress.

Iran’s crisis is real, and so is the suffering of its people. History warns us, though, that escaping a cauldron without understanding what lies beyond often leads straight into fire. For Iranians, the danger is replacing one form of domination with another. For the Gulf, the danger is discovering that an adversary’s collapse creates more problems than its containment. The hardest truth, and the one policymakers least like to confront, is that stability, even flawed stability, often imposes fewer costs than disorder dressed up as liberation. For once a system breaks, the consequences rarely stop at its borders.

By Mo Fakhro

I was surprised to learn today that Harvard University is the oldest university in the United States. It does seem to suggest a correlation between being the first in a sector and being amongst its leaders. Jack Welch, the late CEO of General Electric, was famous for saying that he preferred to be the second in an industry because he could learn from the mistakes of the first. So, which is better, being first or being second? I think that both have advantages and disadvantages. From a purely financial standpoint, I would agree with Mr Welch that it is better to compete in a sector that already exists than to take chances trying to create a sector that does not exist. Steve Jobs was famous for saying that customers do not know what they want, which implies that it is better to create a new sector or product category and be the first to make it work.

Oxford University is the oldest university in the United Kingdom. IBM, Coca Cola, and Amazon were not the first in their sectors, but they were perhaps the first to succeed on a mass scale at what the do. Silicon Valley was the first to create a technology cluster and no city has been able to emulate its success so far. So perhaps the correlation between being the first and being the best relates to the cluster effect or the network effect. In other words, in industries where the network effect is more important, being the first creates a barrier to entry that is difficult to overcome. Dubai is arguably the first city in the Middle East to create a cluster to attract people through tourism, business, and security.

In other instances, being the second wins. Google was not the first search engine. Facebook was not the first social network. General Electric was not the first to build jet engines. They succeeded by being better than their competitors in sectors that already existed, and so being second has its advantages too.

There is a well-used sales strategy in souqs and bazaars whereby a number of options are presented by the seller to the buyer, with the preferred option being presented last. This suggests that the customer is often prepared to try alternative products before settling on their preferred choice. This would suggest that being last to an industry is the most desirable. Of course, this would only work if the new option offers an advantage over the previous preferred choice. Examples of this would be the shift over time of manufacturing from the UK to the US to China to South East Asia to India. One can infer from this that the next shift would be to Africa but this may not ultimately happen because manufacturing itself will become less people dependent over time, and Africa is relatively fragmented and less well governed than other regions.  

How does this information help us to predict who the winners will be in nascent industries? Will the first movers of today be the market leaders of tomorrow? Or will other players emerge? One could argue that in industries where the network effect is important, the first movers of today will be the market leaders of tomorrow. An example of this would be generative AI. The first mover appears to be OpenAI, and it is gaining data from its initial users that will give it an advantage over newcomers to the sector. This would suggest that just like Harvard was first and thus attracted the best professors, students, and funding, the same would apply to OpenAI. In sectors where the network effect is not as important, first mover advantage is not as important, one could argue. An Example of this would be companies like 23 And Me, which recently closed down. While it was the first mover and market leader, it was unable to create a barrier to entry by creating a network effect. If you are unable to create a cluster effect, then you will need to depend on having a strong brand or great service to set yourself apart. While this is possible, it is more difficult to use it to maintain a barrier to entry.

The surest way to succeed over an extended period it would seem as a company or a city or an institution is to create an ecosystem. I believe that is the main benefit of being a first mover. Once you have an ecosystem, the task of maintaining it becomes important, and perhaps that is where openings often occur for first movers to be unseated by second movers. Institutions that depend more on branding than on ecosystems, like fashion retail companies, will tend to have lower barriers to entry and perhaps lower life spans, and will be ones where the title of being the best constantly shifts towards new entrants to the industry.

And that my friends is my attempt to theorize the magic of being first – and second – and last.

By Mo Fakhro

The term Graveyard of Empires has been used by historians to describe Afghanistan.  It is argued that the country defeated the British, then the Soviets, and then the US through a combination of harsh terrain, cold winters, and clan loyalties.  Some may argue that the people of the country are simply wired differently and have some mystical ability to defeat goliaths.  Historians look at the people, the terrain, the psychology, and the ideology.  What is often overlooked, though, is simple economics.  What all conquerors of Afghanistan have found is not that it cannot be conquered, but that once it is conquered, it is a loss-making enterprise.  In other words, they have come to the same conclusion that many entrepreneurs come to when they start a new business and discover over a period of years that it is losing money and must be closed down.  I would argue that this is the main reason why Afghanistan is difficult to conquer.  It has very little to do with the people or the religion or the terrain or anything mystical or intangible.  It is just simple algebra.  Basic math.  What is the point of ruling a country if doing so will lose you money.  What is the point of holding onto a business that loses money.  There is no point in doing that, and that is the point.

The British Empire ruled over large swaths of the world during its colonial period.  This began with what was perhaps not the most creatively named territory of Newfoundland in 1583 (which today is a part of Canada) and ended one might say when the British handed Hong Kong back to China in 1997.  The British conquests of South Asia and North America were quite profitable.  The North American territory had so much potential that many chose to settle it.  When the British left what became the United States, it was not because they were forced to leave by the Native Americans but because the initial settlers had felt the prize was too great to be shared with their brethren back home.  It was the greed of capitalism that was the primary driving force, and that perhaps shaped the ideology of the country that would become the torch bearer of individualism.  Viewed from the lens of economics, the British therefore did not leave the United States per se, but rather allowed for the inevitable process of sybiosys to occur. It was the British settlers who decided to break off from the British Empire for personal gain.  In other words, the British left the United States very early in the colonial era not because it was unprofitable and not because they were defeated by the Native Americans, but because the settlers realized how profitable the land was and wanted to keep the spoils for themselves. 

If one were to exclude the US example therefore from the sample, it is quite telling that the British Empire left Afghanistan as early as 1919.  It left India in 1947 and the Gulf states in the early 1970s.  The problem with conquering Afghanistan, I would argue, is not that it is not conquerable.  All of the empires were able to conquer the territory.  The problem was that once it was conquered, there was no way to make money from the conquest.  The country lacked the jewels of India, the oil of the Gulf, or the grain of the United States.  In effect, the spoils of war were a large number of rocks in the middle of nowhere.  In fact, it is worth asking the question: Why on earth would any colonialist want to conquer Afghanistan? It would be like wanting to conquer Antarctica or Mars for that matter.  What financial gain could possibly come from that?

It was an unintended consequence of the fight against Soviet communism during the war of 1979 to 1988 in Afghanistan, that created an extreme aberration of a religion to achieve political and military objectives.  This was used to eradicate the communist threat in Afghanistan and to perhaps prevent its spread further to Pakistan and the Middle East.  There is a famous historical Arabic poet named Al Mutanabi.  One of his quotes is that “You should not go hunting with a lion, because eventually, the lion will run out of prey, and then he will make you his prey”.  I believe the lion is too heroic an animal to be compared to an Islamic terrorist.  A more appropriate term would be monster, in my view.  However, the meaning is the same.  The CIA, in coordination with the ISI in Pakistan and the governments of the Arab and Islamic World, had inadvertently gone hunting the Soviets with a band of monsters at their side, and those same monsters had come back to attack them once they had no prey left. 

The 9/11 terrorist attacks were a stain on anyone who had vouched for Islamic fundamentalism as a force against communism.  The attacks were a barbaric act of extreme violence.  They ruptured the lives of millions of people who were directly or indirectly impacted by the attacks.  The primary sufferers were the victims and their families.  Many more suffered around the world in ways that they may never fully recover from.  The goodwill between Muslim countries and the United States suffered what seemed at the time to be irreparable damage.  In particular, the countries of the Arabian Gulf, had built significant bonds with the United States at the country and individual level through cultural exchange, education, tourism, and business.  Most individuals in the Arabian Gulf felt deeply indebted to the US for saving Kuwait and the GCC from Saddam Hussein.  At the individual level, millions of people (your author included) had spent their lives building bridges between East and West through deep friendships and relationships developed over years of interaction in academia and business.  They found their worlds ruptured irreparably by a despicable act of extreme violence.  It is quite telling of the cowardice of Osama Bin Laden and his band of thugs, that they chose Afghanistan as their hiding place.  It takes a true coward to find a great hiding place.  They could have chosen other places to hide, but they chose Afghanistan.

Ultimately, the United States came to the same conclusion that the Soviet Union had come to before it, and that the British Empire had come to before it, too.  It is the same conclusion that millions of entrepreneurs and investors will have come to during their lives.  They all realized, sooner or later, that there is no point in holding on to a lossmaking asset.  It’s okay for one year, maybe five.  Beyond that, what’s the point? The only conceivable reason why the US stayed for twenty years is that it got stuck in a concept that we business people know well.  It is the concept of sunk costs.  It is money that has already been lost and will never come back.  Do you keep going hoping against hope that it will come back or do you pull the plug? You do not cut the cord and delay, delay, delay, because you are too embarrassed to drop your tools and head for the door, and so you wait for your successor to bite the bullet.  It is not then that no country in the world can conquer Afghanistan.  Afghanistan was in fact conquered by the British, the Soviets, and the Americans.  It is just that no politician can make a case to maintain a budget deficit indefinitely to own a collection of rocks in the middle of nowhere.

By Mo Fakhro

When one takes a view of human history, it is clear that human actions often have unintended consequences.  This is true at the level of individuals and governments too. 

When the Bolshevik revolutionaries overthrew the Romanov dynasty, their new form of government, communism, under the leadership of Vladamir Lenin and with the ideals of Karl Marx, represented a threat to the regimes of Europe.  Interestingly, during much of the intraWorld War period (1918 – 1939), many in the West were more fearful of communism than they were of fascism.  The great fear was the spread of communism throughout Europe.  It may have been seen by some that Germany was a bulwark to the expansion of the Soviet Union.  This may partly explain the slowness with which Nevil Chamberlain reacted to the maniacal actions of Adolf Hitler.  The loss of Germany in World War II led to the expansion of communism into Eastern Europe.  While the goals of defeating Germany were achieved by the Allies during World War II, their actions inevitably led to an expansion of communism.  In effect then, the main countries that contributed to the emergence of the Soviet Union as a global superpower were the US and the UK, through their alliance with the Soviet Union to defeat the Nazis.  This is even though both the US and the UK did not want communism to expand in influence.  

When the economies of the Arabian Gulf discovered oil, there was a rapid expansion of the economies of the region.  This led to an increase in salaries in both the public and private sectors, which in turn led to an increase in land prices and rentals.  Factories thus found it more competitive to be based in other parts of the world where salaries and rentals were lower.  The discovery of oil led to a great deal of wealth, but it had the unintended consequence of making it difficult for companies in the region to be competitive globally in industries not affiliated with oil. To elaborate, it was possible to be successful in trading, tourism, and banking, for example, because they were services that served the local economy. However, being globally competitive, in say electronics manufacturing was not possible in the absence of artificially imposed barriers to entry.

When the Thai Minister of Science visited Iran, he was said to have been amazed by the industrial development in the country.  He wondered aloud to his hosts that if they were able to achieve so much with sanctions, imagine how much would be possible without sanctions.  The hosts responded that none of this would be possible without sanctions.  There is truth to this.  The sanctions created a barrier to entry that allowed the infant industries in that country to develop on their own.  Their industrial development was thus an unintended consequence of their hostility to the rest of the world.

When the US invaded Iraq, and subsequently, when Saddam Hussein was removed from power, this led to the expansion of Iranian influence across the Middle East.  The main government who thus contributed to the emergence of Iran as a regional superpower was the US.  This is even though the US did not want to see an expansion in Iranian influence.  It was an unintended consequence.

What impact would the destruction of Palestinian aspirations have over the long term? What would be the consequences of the US support for Israel and what would be the unintended consequences? One strong possibility is that the positions of the US and UK will unify the Global South in a way that has not happened to date.  It would provide an opening for China to gain geopolitical influence in the Middle East and Africa, and perhaps emerge as a new global superpower.  While it is true that many of the governments of the Arab World maintain relations with Israel, one could argue that such relations are based more on fear and less on affection.  This may also be the case with many other governments around the world. It is an unwritten rule in geopolitics, that if you mess with Israel, you will face consequences from the US.  The intended consequence of the US supporting Israel is to ensure the security of its main ally in the Middle East.  An unintended consequence may be to drive the rest of the world closer towards the new Chinese world order.  In 2003, when the US invaded Iraq, it was the sole global superpower.  It was thus able to breach international law without consequence.  By supporting Israel today, even as Israel gets reprimanded by international institutions, the US is opening the door to China to create a new world order.  It is thus somewhat paradoxical that the main country that may contribute to the emergence of China as a global superpower may be the US, as an unintended consequence of its unilateral support for Israel.

The world we live in is highly dynamic.  It is a constantly moving chessboard with infinite parts.  Actions that upset the equilibrium will inevitably lead to unintended consequences.  It is important for us to always pause for thought before taking actions, as individuals and as institutions, to think first about the intended consequences, and then to think multiple steps further to the labyrinth of possible unintended consequences.

I was taken aback by a response of ChatGPT to a question I put to it. I asked it “Is Caitlyn Jenner a man or a woman?” and it responded, “Caitlyn Jenner is a woman” without any explanation. I was surprised by the definitiveness of it, given its tendency to give me more verbose responses. Google gave me a more elaborate response that I felt was more accurate.

I think this is a reflection more of the initial data that ChatGPT was fed, rather than an intentional attempt to influence people’s views on political and ethical debates. Since OpenAI is a Northern Californian startup, my guess is that ChatGPT’s initial data will lean towards the views of Democrats in the United States.

My assessment is that OpenAI is an ethical organization that will ultimately have a balanced view of the world. However, some biases are unintentional, and sometimes people are not aware of their biases.

In the end, it is the owner of the product that gets to decide and if the customer does not like the responses, then they will be free to use a competing product. I am sure there will be many other products like ChatGPT, but I expect that ChatGPT will always be the leader in this category. I would compare it to a newspaper owner in the 20th century. The person who owned the paper in the city got to influence the views of people if they chose to.

I am amazed by the power of ideas. We sometimes forget that many revolutionary innovations are based on very simple ideas. We often go about our business lives assuming that our business ideas need to fit into a box of what has already been done. Why not think about what has never been done before? Why not think about how to change the world for the better with a simple idea? 

The entire industrial revolution was triggered by the very simple idea that if one person does the same task repeatedly, he or she would get better at it and would hence be able to do it more quickly. This at its core is what economists refer to as specialization and division of labor. As a result of the application of this very simple idea, one-man shops where one individual would create a product from scratch to completion, were replaced by massive factories where each person would do a simple part of the process. As a result, products were produced more cheaply and more consistently.

Another very simple idea is the use of refined petroleum to power engines. We have gotten so used to the idea that oil is a source of energy that we forget that at its core, its only use is that it is highly flammable. It would be difficult to exaggerate the impact that the use of this substance has had on the world. This one property has created massive amounts of wealth, triggered wars, and significantly improved the mobility of humans. Yet at its core, it is only useful because it expands when it is lit and hence is able to move a piston.

The internet was also based on a very simple idea. The internet is perhaps the most significant economic development of the past 20 or 30 years and yet, as I understand it, it is based at its most basic level on something very simple. Someone somewhere realized that if they connected two computers with a wire, then a person on any one of the two devices would have access to the information on both devices. This was then applied on a massive scale to the point where we now, effectively, have access to the information on a massive number of computers and servers around the world. 

The internet replaced the printing press as the key engine for the mass distribution of information. The printing press itself was also a very simple concept. Rather than duplicating things by rewriting them all the time, someone figured that they could create a stamp with that information. While the stamp would take longer to create than writing one document, once it was created, it could be re-stamped in a fraction of the time that it would take to write the same document. 

Blockchain is another simple idea. It sounds abstract, but at its most basic level, it is simply a very small modification on the way that computer programming is currently done. At its most basic level, it is just about connecting blocks of data to one another in a way that makes them interconnected and, crucially, almost impossible to edit or erase. This, when extrapolated over millions of applications, will likely change the way that business is conducted in the years to come. 

I write this because most people assume that changing the world is something that should be reserved for people with PhDs wearing lab coats at a university. While this is true in many cases, it is true in my view because the people in those settings are wholly dedicated to that goal, and not because they are any more gifted than you or I. So, when you start your day and look at the world, realize that you too could actively participate in its progress. When you think of your next business idea, challenge yourself to think about how you could change the world.

Today is the last day of BBC Arabic Radio. This is quite sad for me. The chimes of Big Ben that they play at the top of each hour remind me of hearing the news in the background as a child, at the old house of my grandparents, sitting by the black transistor radio of my grandmother. The sound takes me back to a simpler time, a perpetual constant in a world of constant change.

Perhaps this is a sign of the times, although I wish there was a way for the old ways to continue. In recent years, I have come to rely on it to strengthen my Arabic. My English and Math skills remain sharp because of the nature of my job, but my Arabic needs regular “maintenance” to remain where I need it to be.

I hence keep it on in the background when I drop my kids to school, to allow me to strengthen my Arabic skills, and to perhaps rub off on my kids as well, dare they lose completely the Arabic roots that I, through circumstance, have eroded. The chimes will stop for good tonight, and with them the nostalgia that has taken me back in time daily, if ever so briefly, to a world that was.

One of the missing components in Arab societies is academic excellence. This, I believe, is the result of many factors. One of the key ones, it could be argued, is that individuals in the Arab World do not see a clear correlation between academic excellence and career success. This seems to be changing slowly. It will not change significantly though, until there is general cultural acceptance of this correlation. More broadly, the countries of the Arab World need to get better at rewarding people based on talent and hard work, rather than based on ethnicity, or country of origin. Status needs to be attained based on merit, and not based on what one wears, the car one drives, or the tribe that one belongs to.

While every culture has its pros and cons, this aspect of Arab culture may be one of the reasons for the generally low levels of productivity and creativity. In other words, the close familial ties, and the cultural nature to devalue merit, and overvalue traditions, creates strong societal ties, but it has a negative impact on economic progress.

Another critical reason for the lack of academic excellence may be the feeling among many Arabs that they live in an unfair world, in which effort and good intentions do not get rewarded. This in the Arab psyche is the result of a combination of geopolitical factors that may have impacted the current mindset. If one were to peer into the minds of Arabs, they would find a conflicted organism. It would be a mind that sees the world unfairly due to a long history of civil wars, corruption, famine, and revolution. In this environment, academic excellence is not of as much use.

Most Arabs see the Palestine issue as a core injustice. They feel that the creation of a two-state solution that can allow Palestinians and Israelis to live peacefully is a requirement that is long overdue. When one combines this with the series of revolutions and civil wars that Arab people have endured, it becomes not surprising then that in many pockets of the Arab World, daily life for the past few generations in many cases has revolved around “I just want to not die today” or more likely “I just want to die of natural causes one day”. This culture of persecution has an impact on what parents teach their kids from Iraq to Lebanon to Libya, and about what society and experience teach the Arab collective, about the value of education, or more likely the low priority given to education, in this complex ecosystem. This then makes it somewhat easier to understand what is preventing the creation of a meritocracy in the Arab World.

There are pockets of hope though. The countries of the GCC have the potential to recalibrate things over the coming decades. They have been amongst the fastest growing and most dynamic economies of the world since the discovery of oil. They collectively account for approximately half of the total 3 trillion US Dollar Arab World economy. All have in recent years taken bold steps to nurture and reward merit, and to diversify their dependence away from oil. They have also invested heavily in scholarships and on quality education to their people while rewarding people based on capability, attitude, effort, and results. They have been a shining ray of hope of what is possible when merit is nurtured and will likely collectively be amongst the 10 largest economies in the World over the coming generation. Their collective success will likely be the tide that lifts all boats in the Arab World and changes the Arab mindset from one of dependence and conspiracy to one of hope and intellect.

It might be said too though, that the discovery of oil in the region has been a key factor that has devalued merit, even while it has helped to finance the education and well-being of the people of the area. Many Arabs tend to see wealth creation as simply an accident of where one is born. Those born in oil rich countries get rich, and those born in countries with no oil do not. The difficulty to migrate from the oil poor countries to the oil rich countries, or to migrate from the oil poor countries to anywhere in the world for that matter, act to exacerbate this feeling. Moreover, the general perception is that no degree from Oxford or Cambridge or even MIT will allow one to change the color or usefulness or location of the black gold from which many of their brethren subsist. Perhaps more importantly, no degree will change your nationality or your tribe, and this then explains why many feel that the main determinant of their wealth is an accident that is determined by fate and can only be influenced by prayer or good luck, rather than by hard work, creativity, or ingenuity. This may also explain the pervasiveness of the word Inshallah (God willing) in the Arab vocabulary and Arab parlance over the past fifty years. In this narrative, is oil then a blessing or a curse? It has brought wealth, but it has also brought war and complacency. It has built our roads, but what has it done for our minds? What has it done to our minds?

Arab tribes have long learnt how to deal with adversity. It is a mindset that has allowed them to survive as a collective for centuries without much access to water or food, in one of the most inhospitable climates on our planet. In a culture in which staying alive was an everyday struggle, societal bonds and familial support over the centuries had taken precedence over individuality. This may explain why Arab clothing is so uniform, as though the intent is to not highlight the individual but the collective. This feeling then, that we either all sink together or float together, is one that an observer would find still forms the nucleus that bonds the confines of many families and tribes. It is then not surprising too why loyalty to the tribe, respect for societal traditions, and a reverence for the community, persist as Arab values, and are seen as more important than individuality, merit, and intellect.