ThinkBusiness Today - July 7th

E kaaro o, Ututu Oma, Barka de Safe - Good morning, and a warm welcome to ThinkBusiness Nigeria, your Monday – Friday dose of commentary, contexts, and insights on business and economic news that matter to you.

TGIF.

As you would expect, I must read a lot in my job. So, people often ask how do I read? Meaning, do I read cover to cover? Oh, no. You can’t read every book or report cover to cover. Not because you can’t or the books are not interesting (though some are not!), it is because no one should read for reading’s sake – there is no progress per se in the knowing but in the application (doing) of the known.

But “The Hard Thing About Hard Things”, the book I reviewed today is an exception. It is not only well written, but also written for ‘my time’.

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Markets

• Yesterday, NGX All-Share Index (ASI) increased by 496.31 (0.83%) points to close at 62,019.88, showing a week gain of 2.55%, a 4-week gain of 8.79%, and an overall year-to-date gain of 21.01%. Key share prince movement include that of CONOIL (+10%), MRS (+10%), ETERNA (+10%), UBN (+10%), LEARNAFRICA (+10%) and NASCON (+9.95%).

• Oil prices edged lower on Thursday as the market digested the higher likelihood of a U.S. rate hike accelerating fears of global economic slowdown against tighter crude supply. Brent crude futures were down US $1.31 to $75.34 a barrel after a 0.5% gain the previous day. U.S. West Texas Intermediate crude was 57 cents down to US $71.22 after rising 2.9% in post-holiday trade on Wednesday.

• Naira was down in both market. At the I & E window, it depreciated by 2.88%, resulting in a closing rate of N762.63 against the US dollar. On the streets, Naira experienced a slight depreciation of 0.62%, reaching N780.50 against the US dollar.

• Natural gas futures in the United States experienced a further decline of 1.73%, closing at US $2.61. This decline was primarily influenced by increased supply within the US market, which was driven by the resumption of operations at the Freeport LNG export facility.

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National Headlines

• Predictable Tax Changes – For those that take note, I have said here that there are two motivations for the ongoing economic reforms of President Tinubu. The first is to provide a market friendly business environment. The second is to improve the fiscal position of the government. I emphasized this point at my two most recent presentations at the NECA Governing Council and at the Capital Club, Lagos. More important, I added that the stronger motivation is the first. This is important because when there is a conflict in the policy, this gives us an indication of what the President will do. Therefore, not surprising that the President postponed the implementation of the tax changes made in the twilight days of President Buhari. President Tinubu signed four executive orders on telecommunications excise tax, on manufactured products, import tax adjustment levy on certain vehicles, giving businesses time to breathe and adjust to these changes.

Global Headlines

• Interest Rate Changes – It is expected that the Federal Reserve will raise interest rates from the current 5% - 5.25% range when it meets in two weeks July 25 – 26. But it is not expected to raise rates by more than 25 basis points. According to Reuters, market expectation is that the Bank of Canada will also raise interest rates by 25 basis points when it meets July 12, after pausing for five months. Meanwhile, latest data show the number of Americans filing unemployment claims increased by 12,000 last week but private payrolls surged in June, reflecting a tighter labour market still.

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What I read this week

Title – The Hard Thing About Hard Things – Building a Business When There Are No Easy Answers

Author – Ben Horowitz

If you have just started a business, just became a CEO, or involved in some sort of way in growing and building a business, do nothing else until you have finished reading this book. This book is an articulation of the author’s journey as an engineering staff of Silicon Graphics, NetLabs, Lotus Development, Netscape, and AOL before co- founding LoudCloud, and later Opsware. This journey culminated in the sale of Opsware to Hewlett Packard for US $1.6 billion in 2007.

So, Ben’s journey is perhaps not unique for entrepreneurs and many businesspeople because it is full of ups and downs. Every businessperson will tell you that. It is also not unique in the sense that you are invariably ‘married’ to the business, especially at the early growth stages. Of course, it is also not unique about all the functions that you must carry out – hiring, selling, seeking capital etc. But Ben’s story is a 20-year packed and intense waves of “euphoria and terror”. In the middle of it are how things that not within your control shapes the business and its outcomes – the dotcom bubble of 2000.

Unlike many other management books, this book does not just tell you about how hard it is to run a business, it shows and demonstrates what those hard things really are. They are not the ambitions, goals, targets, etc. but how to deal with those things that are not taught in all the best business schools in the world – relationships, family, friends, firing etc. But then, it is still the case that “nobody cares”.

Just Succeed.

Since selling Opsware to Hewllett Packard in 2007, Ben has been the co-founder and general partner of Andreessen Horowitz, a Silicon Valley based venture capital firm that invests in technology firms.

This book will humble and inspire you. Above all, it will tell you that “stuff” happens, hard “stuff” happens, and it is how you hold your nerve and navigate those moments that gives you the best possible chance of success.