In the 18th and 19th centuries, the East India Company rose unchecked into a position of unprecedented power in India. The results were catastrophic.
One night in 1599, in a half-timbered building in London, a group of men gathered to plot a new venture. The gathering included grocers, drapers, haberdashers, and a variety of other merchants. It also included privateers, a former city auditor, and none other than the mayor of London himself. Together, these men planned an unprecedented trade venture that would come to be known as the East India Company (EIC).
In his book, The Anarchy, historian William Dalrymple traces the story of the EIC and its horrific impacts on India. While difficult to face, no one needs a lesson about the dangers of unchecked corporate greed more than staunch capitalists like myself. Here’s a tale of risky investments, the world’s first mega-bailout, and deadly rebellion.
In 1600, Queen Elizabeth I granted the EIC a Royal Charter to conduct trade in India and the surrounding area.
The EIC would incur massive expenses and risks for this venture. Large ships, artillery, and crews were necessary to transport and protect expensive commodities for long journeys. Even if the voyages were successful, there would be no return on investment for several years.
Success actually appeared unlikely. At the time, much of England was impoverished and agricultural. The country produced just 3% of the world’s manufactured goods—small potatoes compared to India, which produced a quarter of the globe’s goods at the time.
To support the venture as much as possible, Queen Elizabeth’s charter established the EIC as a joint-stock corporation from the outset. This was a first; while some other companies eventually made stocks available to the public after a few years of operation, none had sold shares to the public as part of building their initial capital. The successful model went on to establish corporations like the Virginia Company, which formed English colonies in the Americas, and the first joint-stock companies in the Americas: the London Company and the Plymouth Company.
In 1609, the EIC finally reached India, a prosperous country then ruled by Mughal Emperor Jahangir. Perhaps unsurprisingly, the emperor wasn’t exactly chomping at the bit to trade with the unimpressive and notably unhygienic Englishmen. In fact, it wasn’t until one of the voyagers brought back credentials from King James I in 1615 that Emperor Jahangir finally agreed to work with them.
Over the next few decades, the EIC established outposts across India. To protect their efforts, they built a militia of hired Indian soldiers. By the 1730s, the EIC’s guarded outposts looked more like forts than trade centers—an omen, perhaps, of times to come.
In 1739, various regional rivalries in India came to a head. Delhi was ransacked, and governmental power became more distributed. The emperor was now more of a symbol than a leader, and in 1765, the EIC used this to the company’s advantage. After seizing control of strategic regions thanks to their large, private army, the EIC forced the emperor to cede the right to collect revenue in Bengal, Bihar, and Orissa.
At that moment, the once-pitiable Englishmen went from running a successful corporation to acting as a government entity, much to the horror of many previously prosperous Indian citizens. “What honor is left to us?” Narayan Singh, a Mughal official, asked, “when we have to take orders from a handful of traders who have not yet learned to wash their bottoms?”
Trouble in paradise quickly arose. After just four years, famine and low land revenues in Bengal collapsed EICs stock in an event called the Bengal Bubble of 1769. “So it was that in 1773, the world’s first aggressive multinational corporation was saved by history’s first mega-bailout,” Dalrymple writes. Attempts to reform the company were stymied by the financial crisis in England, leaving the EIC to quickly resume business as usual.
By 1803, the company’s private security force was 260,000 strong, twice the size of the British army. It used this power to capture Delhi, ruthlessly ruling nearly all of India from (and funneling the country’s revenue to) a small business building on a narrow street in London.
But the EIC soldiers that protected this delicate balance eventually turned on their employer. In the Indian Mutiny of 1857, the militia, joined by civilians, revolted and nearly succeeded in overthrowing the company. In a gruesome response, the EIC hung thousands of rebels in the streets. The overt violence and instability prompted Great Britain to take over control of India shortly thereafter, but the damage done lingers even today.
In the words of Dalrymple, “if history shows anything, it is that in the intimate dance between the power of the state and that of the corporation, while the latter can be regulated, it will use all the resources in its power to resist."
While we’d be hard-pressed to find a company today with the military might of the EIC, many corporations have higher revenues than the GDP of some countries, and garner much influence as a result. The way I see it, the East India Company’s history is a cautionary tale to remind us capitalists that we ought to work with governments or risk destabilizing the very places where we do business.
Sandeep: Tell me a bit about the early part of your career.
Tom: I spent a decade helping to build start-ups focused on application and database software. This was where I learned how to sell and do business development. I was fortunate to be part of one company going public and another being sold to IBM.
Sandeep: What is something you learned during this time that helped you with consulting?
Tom: I began to appreciate how different customers achieved varying levels of success with the same foundational technology. This made me understand just how critical getting your team and process right can be.
Sandeep: This is something I only came to appreciate years into consulting, especially after the sale of my first consultancy to Capital One.I saw teams in different parts of the company trying to solve challenges like real-time messaging. Same corporate culture, same technology, same internal support mechanisms. Night and day outcomes.
Tom: We saw a lot of the same thing after selling our practice to EMC (sold to Dell in 2015). This is probably the thing I'm most proud of when it comes to the teams I've helped to build: the ability to perform well in a variety of contexts, sometimes in ways that inspires the client team to up their game as well.
Sandeep: Yes. It's particularly cool to see your team succeed in individual ways after an acquisition...consulting skills definitely translate into the corporate environment.
Tom: Totally. We have people who've stayed on at Dell and risen up the ranks, while others took the opportunity to become successful executives at other Fortune 100 companies....or to start their own agencies and startups.
Sandeep: We've both been around a while. My first consulting project was a Y2K thing for Cisco back in 1998. You've been around a little longer than that :). How do you think consulting has changed most during the past five years?
Tom: I think because there is so much infrastructure available now, consulting has become more delivery and outcome-oriented. A better blend of strategic and tactical. Public Cloud has also enabled velocity to increase at a pace unfathomable 5 years ago.
Sandeep: What has stayed the same?
Tom: It's still mostly about people. People who thrive on change and are focused on their personal and professional development. I love that this has not and will not change...it's what I love about consulting.
Sandeep: I know you're adjusting your work style to COVID. You're still a dude who clearly prefers to drive an hour for a socially-distanced hike or outdoor meeting over Zoom any day of the week :) But personal styles aside, what is specifically compelling about a remote agency during the era of COVID?
Tom: Kunai has been remote for years, which gives them an inherent advantage. There is something about the communication and management styles that just works in a way that other organizations are still figuring out.
Sandeep: Yeah, I think what a lot of people fail to realize is that remote work isn't just office work over Zoom. it's an entirely new paradigm. There needs to be an understanding for asynchronous efficiency...and this just takes time and effort to develop. How do you approach remote work and family? What are you learning about separating work and personal time?
Tom: No matter what the form of interaction, Focus. Be present. Quality over quantity. The best weeks are the weeks where I proactively schedule work and personal time. Neil (Kunai's Head of Delivery) shared a great quote with me "With discipline comes freedom." When I am proactively addressing the majority of my professional and personal commitments, I find I earn a little flexibility. A little freedom.
Sandeep: Tell us about a business hero of yours that I may not have heard of before.
Tom: Paul O'Neill is someone you may not know. His work in both the public and the private sector created a profound impact
Sandeep: We are both over forty years old :). How have you learned how to work smarter during the past decade or so? What do you wish you knew about consulting when you were 25 that you know now?
Tom: Consultants want to make lasting change. Lasting change is often not the act of a single person. Today I work much harder bringing others along on the journey.
Sandeep: Last question. What are you doing here? :) Why join a small consulting company this late in your career when you could have a cushy job somewhere else?
Tom: I love a good challenge personally and professionally. When I turned 40, I decided I would run a 10K every Thanksgiving weekend and try to have my finishing time be less than my age. With the exception of one year where I did not run due to a health issue, I have met the goal. I also recently completed the Leadville 100 Mountain Bike race. So, I guess I'm here because I'm a glutton for punishment :) Jokes aside, our customers have a job to do and I intend to put Kunai in a position to execute flawlessly on their behalf. I love committing jointly to audacious goals for our customers and our business.
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