Trailblazers: Young Global Leader – Sangeet Paul Choudary, PGP 2006

The world always needs the capable shoulders of young minds and their zeal, to move ahead and accomplish great things. Sangeet Paul Choudary is one such person, who has made a distinguished mark for himself in the society. Sangeet is best known for his work on the transition of business models from pipelines to platforms. He is the founder of Platformation Labs and currently lives in Singapore.

He is also an international best-selling author. He is the co-author of Platform Revolution and the author of Platform Scale. Recognized and sought for his expertise by various international bodies and organizations, his achievements are commendable.

We spoke to Sangeet about his work, hobbies, future plans and memories of his days back at the campus.

Can you briefly tell us about the Platform Model?
The platform business model has gained increasing prominence over the last decade but few people understood it when I first started talking about it around 10 years back. To explain platforms, I contrast them with the traditional model of business, that we’ve been taught at B-school, which I call a pipeline, where firms build products or services, push them out, and sell them to consumers. A platform instead is a plug-and-play business model that allows multiple participants (producers and consumers) to connect to it, interact with each other and create and exchange value. The firm does not merely push products and services, it enables interactions. As a result of this, the firm is no longer inhibited for scale based on access to resources on the supply side, the firm scales by leveraging resources on the demand side, many of which are provisioned by the ecosystem. These three insights – two-sided market creation, interaction facilitation instead of production, and shift from supply-side economies of scale to demand-side economies of scale – govern much of business today. As a simple example, hotels leverage supply-side economies but Airbnb, by using its ecosystem of hosts benefits from demand-side economies. Airbnb may sound like an obvious and trivial example but in the course of my work, I see this apply across the future of global trade, energy markets, healthcare systems, and financial systems. And that’s where this concept becomes really powerful. The real power of platforms is not in starting the next photo-sharing startup but in re-imagining all the systems that we inhabit using the above three simple ideas.

What the major benefits of using the platform business model?
Well, the well-stated benefits of using the platform model is the ability to leverage scale beyond the boundaries of your firm. The market value-per-employee ratio of platform firms is 20X – 200X that of their competitors. But it’s equally important to understand the tension that the platform economy is heading towards in the coming years. On the one hand, the UN is advocating the adoption of digital public goods as a move towards greater inclusion for marginalized actors into the digital economy – the India Stack is one example. At the other end, we see dominant platforms repeatedly exploit the ecosystem, not because they are unethical, but because it is the very nature of competition to monopolize scarce resources and commoditize other actors in different layers of the value chain. In our day, actionable data and the ability to leverage it to move ecosystems to action (e.g. move taxis to areas of high demand or make users click on ads) is the scarce resource. And platforms that monopolize control over data and ecosystem influence (through recommendation engines and a host of other behavior design mechanisms) are increasingly exploiting players in the ecosystem. A significant part of my work is helping governments understand how to regulate these platforms – so that delivery platforms and ride-hailing platforms do not exploit drivers, social media platforms do not deplete democratic choice, and eCommerce platforms do not commoditize small businesses. I know I’ve talked a lot about what’s not right about platforms instead of sharing the benefits but I believe we largely understand the benefits today and are at a point where we need to make hard choices about the future of how these businesses are designed.

How did the idea for this model come about? Any inspirational story behind this?

My work has been the outcome of following my personal fascination. At IIMB, back in 2004-06, very few people talked about internet businesses. There was a decided skew towards traditional finance and marketing roles. After I quit IIMB, I started working at companies like Yahoo and Intuit, which were working on the internet but didn’t quite fully grasp it. This led to a personal fascination where I started spending all my time outside work (evenings and weekends) trying to understand why digital business models were fundamentally different. Starting in 2010, I started meeting a range of people over the weekends trying to figure out their mental models of the internet. I emailed random people around the world whose articles I’d enjoyed reading and was pleasantly surprised at how many of them were willing to get onto a call to bounce some ideas around. I built my own data set of more than 250 companies aggregating all information and data points about them and understanding their business models. Sometime in 2011, I started connecting a lot of the dots together to put together a cohesive theory. By early 2012, I was too consumed by the results I was seeing in my weekend work to continue at my weekday job. I quit my full-time job in the summer of 2012 without a clue of what I was going to do with my work. All I knew was that I was obsessed with it and that I would not be true to myself if I continued doing anything else.

Initially, I started writing a blog out of my bedroom which started getting traction globally in a niche community. By the end of that year, my blog had been featured in a book by Harvard Business School and briefly in the Wall Street Journal Digital’s recommended reading list. A growing community of people started following my work and two of the world’s leading researchers on this topic from MIT reached out to collaborate with me. Around this time, I wrote two books that have been international bestsellers and heavily cited in academia. As the popularity of my work has grown, many new avenues and collaborations opened successively creating new pathways for the work into the Fortune 500, policymakers and social sectors. I am deeply indebted to the many people who took an interest in my work and championed it in their respective worlds and continue to do so to this day.

What hobbies do you pursue in your personal time?

• I’ve always enjoyed writing (including fiction and humour). Everything worthwhile that I’ve ever accomplished has involved writing. Writing is a powerful tool to help clarify our thinking as humans and gives us a significant competitive advantage over those who largely clarify their thinking through conversations.
• Apart from this, I’m a musician and enjoy playing in bands, whenever I get the opportunity. I really enjoyed doing this back during my IIMB days, and had put together a bits-and-pieces band (we didn’t have a bassist) back then at IIMB called The StereoTypes.
• I enjoy working on small random creative projects, which may range from building lego sets with my daughter to composing music to designing board games. A lot of my actual work involves long term projects (e.g. writing a book) without any rewards in the short term, so the satisfaction of seeing creative output in the short term through these pursuits on the side – however trivial – gives me the energy to keep pushing on long term goals.

What are you reading these days?
Books I am currently reading (I usually read 2-3 simultaneously to interconnect ideas) – Globalists by Quinn Slobodian, Surveillance Capitalism by Shoshana Zuboff and Extreme Economies by Richard Davies.

Any plans of engagement with IIMB?
I’ve always loved engaging with IIMB and the IIMB alumni community. The IIMB Singapore community organized a fireside chat with me a couple of years back which was really fun. In the IIMB context, I’m particularly keen to contribute on two fronts: first, encouraging and helping students and young alums take risks and build unique paths in the industry. We see people build unique paths in the creative sectors post IIMB but not many do it in industry. Second, I’d like to see if there’s any way I can play a part in helping young researchers at the institute create globally relevant research that has an impact beyond the India/Asia/Emerging markets narrative.

What are your fondest memories from campus days at IIMB?
I’m a night owl, I’m not a morning person. Some of my fondest memories of IIMB include waiting for the night canteen, the midnight (or 2 am?) chai guy, and hoosh-ing junta for no rhyme or reason. L-square – the party, not the place – will always be special. On the flip side, I could never make it in time for the 8 am class or would stay up through the night and then fall asleep in class, with the instructors not being the least bit amused. I remember I was asked to leave a fourth term strategy elective class as the instructor caught me napping thrice in the first 10 minutes. I don’t think that (being asked to leave the class) happens a lot. 🙂

What are your future plans?
I hope to continue doing good work while also living a balanced life.