Business Leadership: The Cornerstone of Profitability

Introduction
Business Leadership is nothing but being profitable. This is the foundation for business to know if they have got the business acumen and more importantly are they doing their work and homework well.
How new age entrepreneurs with dynamic business model in India are making waves in the business world.
We have two case studies of Wework India and Zerodha- a fintech startup which is now the most profitable finance company of India in recent times.


Case Study 1: Wework India
From a loss of 120 crore in 2021 to profit of 175 crore this year by #Wework India is really laudable.

Factors aiding in the demand for co working space
A: hybrid mode of work
B: flex spaces for vicinity, travelling
C: Networking opportunities
D: Aesthetic infrastructure without hassles

The CEO of Wework India stated that there is no need for further funds as their bottomline is becoming stronger and they are self sufficient financially.

He expects the company to grow in 2023 with the topline growth of 1500 crore which is growing by leaps and
bounds.

The revenue growth was 1300 crore between January-December as against Rs 760 crore in 2021.
Interestingly, old school commercial real estate also saw a boom of 40% in last two years as companies return to grow and scale up.

Changing Business Dynamics:

These are dynamic times for business.
The business dynamics have changed drastically post pandemic.
The commercial real estate where both the old school and new school of commercial players are seeing rising growth is noteworthy and tell a tale of changing times and transforming business landscapes.

Dynamic Leadership is understanding the next wave of dynamism in your industry and in future industries which will absolutely change the way in which business will be done.
If you are Leading the change, like Wework, great.

If not, you need to be aware of who and how is the player in your industry bringing the change and can quickly adapt to the requisite changes to be in the forefront of the race.
The Future: Co-Living and Co-Working
Next growth for Wework could be to get Welive (co-living) which is in fledgling state in New York to India.
Under Adam Neumann, Welive was all set to take wings and bring a revolutionary change in the coliving space.
Since he is ousted from the company, this project is on the backburner for Wework Group.

With co living , accommodation is shared with others and is better if not cheaper than renting a living space.

Coliving is shared space for living and that brings the cost down. Sometimes it is not the case, as you can have a room mate while renting a flat which will ensure the rents are not steep.

2025 Flex Spaces: Future Combo of Co-working and Co-living!

Zillionite envisages that this space will have best of both the worlds which equips the work force and gives them the proverbial work life balance in one sense if not the other!

Even if the next pandemic hits, it will not put brakes to work as you can jump out of your bed and lo you have entered your office!
Aha!

Compensation at Zerodha
100 crore salary — Eye popping or Mind boggling compensation?
This is a case study about finance for entrepreneurs – Thought Leadership
Zerodha, an online brokerage firm has decided to compensate its three promoters with INR 100 crore salary.

Salary of 100 crore means ending up in higher tax bracket. So does this make sense?
Compensation is difficult to structure even more in start ups.
Zerodha is a private company and has the liberty to add zeroes as it deems fit.
Lets looks at the strategic outlook in different cases:
Option 1: Salary income tax
Take salary and pay 43% of taxes. So cash in hand will be INR 57 crores.
Option 2: Dividend tax
The corporate tax rate is 25%. Individual dividend tax rate is 34.5%
So after the corporate tax and individual tax, they will get INR 49 crores.
Option 3:
Selling shares through funding, IPO or any such route.
This is ruled out for now as it is a zero debt company with a profit of INR 1000 cr.
Yet with valuations, it will be a lucrative option with less stake and more cash in hand. The leaders at Zerodha state that they want to give back to the society as being the highest tax payers with this compensation.

Leadership Skills- Zero Sum Game
Well, all in all, it is definitely not a Zero sum game with all the zeroes in place and growing without obstacles – for all!
Leadership is a game where you lead when from zero to become one and you have won with the winning leadership skill for sure.


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