Do We Choose Grey Hat, Or The Grey Hat Chooses Us

I met this guy in 2009. That’s 11 years ago. He always wore a hat. He loves them.

He taught me how the systems are gamed. I loved it. We were on the Digg’s front-page everyday. We worked for the top guys. I will probably not name them today. May be they don’t want to acknowledge they gamed the system too.

The system was nothing but a recommendation engine. One of the first I had seen. When Twitter and Facebook ranked posts chronologically, Kevin Rose had the recommendation engine figured out. We just knew how to make the best use of it. Reverse engineering it, I would say.

One of our clients in the sports niche got acquired for $150 million dollars. Almost all of our clients are a multi million dollar properties today.

We even made some of our own tiny sites that we drove from Digg.

Over time, struggling between gaming the system for growth, solving an actual problem or doing both at a time, 2020 came.

Today, I’m wondering, how do you build a global business from Pakistan that could one day grow large enough?

How do you hire white people or black people or asian people or anyone to cast them in your ads? Can you? Are there any in this country? If yes, are they actors? They probably aren’t and you probably can’t.

You could outsource though. For tens of thousands of dollars perhaps? Or millions of Pakistani Rupees that you can most likely save in 5 years working in a day job.

If you’re bootstrapped, which you most likely will be because there aren’t any VCs here, what would you do? Would you get that ad made? Or would you pick a hundred ads from the internet, break them apart, and stitch them enough times that they qualify for “fair use” and become DMCA-free. This would probably cost you $50.

Forget about the ads. Not all businesses advertise and advertising could be just one of the many things about building a business. You will most likely require certain kind of digital infrastructure for sure. PayPal? Ability to accept cards i-e payment gateways? But there are none that support this region. What do you do?

You could fly to US or another supported region, setup a company, and use that to setup the rest of the digital infrastructure. But most likely you’ll never get a visa and you probably also can’t afford this travel easily. If you think I’m exaggerating, I know at least 5 tech entrepreneurs from Pakistan who have built multi million dollar businesses but were declined US visit visa.

May be you could fly to one of 31 visa free countries? But they are just as good as your own country as far as the digital infrastructure and access to business tools is concerned.

You could reach out to friends or relatives in US and form a company in partnership with them. You could use that company to setup PayPal, payment gateway and other business tools that you need to begin your business.

But there’s more. You will most likely be banned at some point once you access these business tools physically from within Pakistan.

What do you do then? You could rent a server physically in US. Remote Desktop Protocol. You could access that server remotely and run your business on that. Sounds sketchy, doesn’t it?

But you could get banned for that too. Because it’s not that big of a deal for these multi billion and trillion dollar companies to understand the difference between a data-center’s IP and that of a home in US.

So may be you could buy a Raspberry Pi that you could physically place in someone’s house in US. I’m confident none of my friends or relatives would agree to this. It would seem strange to them that why would someone want to do it? They would think that there could be something malicious going on that could land them in trouble.

You could also buy a laptop and physically place that in their houses and run your businesses with remote access. I know my cousins aren’t going to like that idea. May be yours do.

By the time you would come this far, you would have exhausted 83% of your energies in setting up the the foundation to start your business.

Thousands of entrepreneurs from Pakistan actually have to go through all of this (and more) to actually start their businesses. May be you see a scammer, but I see a victim that turned around his fate and became a hero.

So what happened there? Did we choose that grey hat, or did that grey hat choose us?

The Indian Comparison

My co-founder cross-questions a lot and assumes very little. Every time he is having a discussion with a Pakistani startup founder, he likes to compare the situation with a similar and often better startup in India.

The reason is that between the two markets, there are many similarities, and India is often slightly ahead in almost all markets. For example, in e-commerce the primary mode of payment in India is also COD just like in Pakistan. The advertising rates in India are just as low as the advertising rates in Pakistan. COD stays as the primary mode of payment despite that there are many payment gateways available and the credit card penetration is much higher.

When a Pakistani founder says that when X will happen in Pakistan, the company will grow very quickly. This is obviously an assumption. Saad then compares the situation with a similar startup in India where often the X has already occurred and more often than not the growth wasn’t seen as predicted or assumed by the Pakistani founder. This analogy helps avoiding the wrong assumptions.

Since India is running 5-10 years ahead in tech albeit having many market similarities, this comparison can frequently be used as a tool to project the future more accurately.