The Bajaj Finance Success Story (3-2-1 by Story Rules #66)

Welcome to the sixty-fifth edition of '3-2-1 by Story Rules'.

A newsletter recommending good examples of storytelling across:

  • 3 tweets
  • 2 articles, and
  • 1 long-form content piece

Let's dive in.

๐• 3 Tweets of the week

Such an interesting chart. Amazing to see how Windows dominance is now a thing of the past. What next? Some new OS by Open AI?

No sense of obligation sir!

A great tweet in case you work for a startup/small firm and need some inspiration. What arresting writing by Jason!

(PS: Look at the sentence length. Pithy, snappy, direct.)

๐Ÿ“„ 2 Articles of the week

โ€‹a. โ€˜But should we use AI to write 1st draftsโ€ฆ? Plus: Editing writers who know more than you' by Ann Handleyโ€‹

Ann's newsletters are always a treat to read. This one offers superb advice on how to use AI in writing (and editing expert writers).

This is a good summary of how to use AI:


This is such a beautiful analogy to explain why it's better not to use AI for writing your first draft:

Using AI to write a first draft feels to me like I've been dropped into a planned community with tended paths and sidewalks and signposts. An enthusiastic golden retriever bounces alongside me, dropping tennis balls relentlessly at my feet. How about this? How about this? How about now?
Writing without AI lets me wander around the wilderness. Machete at my hip, cutting through the thick undergrowth of unexplored territory. Sometimes I get stuck and have to backtrack. Sometimes I get scratched by the brambles. Forest creatures bite my ankles. It's uncomfortable. You sweat a lot.
I like that feelingโ€”of exploring someplace new.

Such evocative language to describe the concept of the Curse of Knowledge:

A challenge with experienced writers who have been writing about the same topic for a long time is that they can easily forget that readers are not them. Readers do not have the same intimacy with the material. They do not have the same depth of understanding. Established writers can easily fall under the Curse of Knowledge, which is a spell by a wizard who lives in the Land of Too Familiar and commutes into Blog City via the express bus (Subject Matter Expert line) to litter the sidewalk with their letters and lingo.

When you are asked to edit or give comments on someone else's piece, a touch of humility is useful:

Invite a dialogue; don't deliver an edict. You're inviting the writer to give their perspective on your suggested edits. You're a collaborator who bridges the mind of the writer and the mind of the reader.
Approach edits like "Have you considered..." or "It might be clearer if..." as a way to suggest improvements without undermining the writer's expertise or destroying their self-esteem. (Writers are sensitive.) (Mmmm aren't we all.)


โ€‹b. 'A VC's Thoughts on How Senior Corporate Leaders Should Explore and Approach Startups' by Sajith Paiโ€‹

If you are a senior corporate executive exploring a role in startups, this is a must-read piece.

(Incidentally, we are lucky to have someone with the work ethic and skill of Sajith Pai working in the startup ecosystem in India.)

He shares the 4 main ways in which leaders can engage with the startup world:

There are four ways in which corporate executives can engage with the world of startups or venture.
1/ They can join a venture fund, as an investor or operating partner / venture advisor.
2/ They can join as a full-time employee, typically as a CXO, sometimes as a COO or CEO.
3/ They can become an advisor, typically for a consulting fee, sometimes gratis. This can be a full-time role if the executive gets enough paid assignments.
4/ They can angel-invest in startups.
The order in which the above is written is intentional. #1 is the hardest to pull off / happen, and #4 is the easiest (of these four).

Sajith shares some great, actionable advice using relatable examples:

To clarify: let us imagine the executive is a senior executive in Bajaj Finance, and is keen to explore doing something with startups. The executive could target over the coming year or so to meet 24 founders (2 every month), by keeping 2-3 hrs on weekends or weekday evenings free for advisory calls or meetings. The executive could reach out to founders in the same sector as they are, in this case, lenders, and introduce themself. I would very much doubt if even one startup in their sector will refuse to meet them. Then depending on the chemistry match, the executives could start working with one of the founders giving gratis advice, unless founders are willing to pay for it. The executives could help in sparring with them on their strategy, introducing them to talent, reviewing their plans, taking the occasional interviews for them, and offering to invest etc. Over time the executives could explore converting this or another one into a paid assignment, or convert the assignment to a full-time role.

Speaking of Bajaj Finance, let's move on to a fascinating podcast conversation on this market leader.

๐ŸŽง 1 long-form listen of the week

โ€‹a. 'Saurabh Mukherjea - Bajaj Finance: Strategies of a Lending Giant' on the Business Breakdowns podcastโ€‹

Hat/tip: Sajith Pai

This is an absolutely fascinating conversation with Saurabh Mukherjea (Founder and CIO of Marcellus Investment Managers) about what makes Bajaj Finance (BFL) the behemoth it is.

Saurabh is a superb data-storyteller and is able to cut through all the clutter and weave a narrative with the most critical metrics of the BFL story.

He starts by setting some context:

BFL is India's largest retail lending NBFC. Majority, nearly 60%, of India's consumer durable loans are made by this one company.
Just to contextualize BFL, I'll sort of give you three dimensions to think about this. In the Indian economy, credit outstanding grows at around 11%. Over the last decade, Bajaj Finance has grown its loan book at thrice as fast, sustainably thrice as fast as the broader lending sector in India.
The second way to contextualize it is just to think about the lending sector in India. Banks lend around $2 trillion in India. Nonbank sector lends around $250 billion. Bajaj Finance's loan book is $40 billion. So roughly one in five nonbank loans in India, one in five nonbank loans in what is the world's fifth largest economy is made by this lender.
And the final way to contextualize Bajaj is just to look at the compounding. So over the last 16 years, this company has compounded share prices 1,000x. That's underpinned by 30% loan book CAGR, 50% PAT CAGR. So 50% PAT CAGR over 16 years, I think that's roughly 650x PAT compounding over 16 years. So we're looking at an extraordinary lender, which has achieved exponential growth in what is one of the world's fastest-growing economies.

Some hard numbers on how data is one of BFL's competitive advantages:, Bajaj Finance uses 1,000 data points on each customer to make the lending decision. This is all automated.
Rather than 1 million doctors, they have 200 million Indians in their database. So you just do the math on that, 200 million Indians times 1,000 data points, Bajaj Finance's database has 200 billion data points inside it. This data lake is getting churned every day. And especially when we get to festive season in India, our equivalent to Christmas is Diwali, the data lake almost explodes.
As a result, Salesforce, which is the analytics and CRM provider to Bajaj, we hear that Salesforce has a separate database entirely for Bajaj Finance. And from what we understand, this is the only lender in the world that Salesforce treats in this manner. This really is the heart of the Bajaj Finance competitive advantage.

They are able to leverage this data set to speed up their loan processing to offer loans in just ... 90 seconds!

The typical BFL loan is given in 90 seconds. So I live in a reasonably affluent part of Mumbai. If I go to the local consumer durables store, there will be BFL's lending desk and some of India's largest banks and nonbanks. Everybody else, barring BFL, will take a couple of hours for that consumer durable loan. BFL is 90 seconds. The reason for that, Matt, is they've already credit assessed the customer long before the customer walked into the store.

BFL has a crazy work-ethic. Work hard, earn lots, seems to be their mantra:

The second aspect of what's very hard for others to replicate is the culture. So I found out about this - around seven years ago, I first invested in the stock. And I've gone to meet Rajeev, my erstwhile neighbor, now the CEO, to understand how the company was doing. And his office executive assistant called me to say that the meeting will be at 7:00. So I said, "7 p.m.?" She said, "No, at 7:00 a.m." And I was a little taken aback, but then I realized that that's when everybody starts work in Bajaj.
In fact, they start work in Bajaj Finance at quarter to 7 every day. It's a 65-hour workweek. Everybody is told it's a 65-hour workweek. And if you can't deal with that, please move on. So the motto is do more, earn more. And this aspect that it's a driven culture, everybody from the CEO down to the youngest graduate will do a 65-hour workweek. I suspect actually they do far more. 65 is the message that we get.

Listen to the full conversation for many such insights.

That's all from this week's edition.



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Ravishankar Iyer

A Storytelling Coach More details here:

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