Why 2015 belongs to Priscilla Chan, America and Philanthropy…

maxresdefaultAbout 35 Years Back somewhere near United States Coastal Region 

A small boat was rocking as it made its way towards shores of the promised land…America. A huge storm was blowing with heavy downpour lashing across the boat. Tucked under on the side of the boat were a couple of Vietnamese refugees of Chinese origin who had bravely endured the journey for many days. It had been a few days since they had eaten anything. They held their hands together in vivid apprehension…of their future in the new country and held their hands together in hope…hope for a better future…a future they wanted to build together…little did they know that their daughter will not only become immensely successful but would go on to become an icon…A person who would forever change the way we know philanthropic initiatives across the world. She along with her husband will change the lives of many underprivileged people and create history. 

Her name shall be forever be written in golden letters in history along with her husband…Priscilla Chan that’s the name her parents would call her…And she would marry one of the greatest Entrepreneurs and Nerdy Dudes of all time…I forgot his name…I use his invention almost every day to read or communicate…Marky Mark aka Mark Zuckerberg…Inventor, Entrepreneur, Humanitarian, Philanthropist, Scholar and of course The Nerdy Stud Dude…CEO Facebook..

This article is dedicated to the essence of what makes USA ( United States), a great nation. This is a tribute to Mark Zuckerberg (Marky Mark The Tech Dude) and his wife Priscilla Chan and also the greats like Venerable Bhikkhu Bodhi, Billy Gates (Billy Boy The Humanitarian Nerdy Dude) and Melinda Gates, Elon Musk, Peter Theil, Larry Page,Sergey Brin, Vinod Khosla, George Washington, Great Abraham Lincoln,Marjorie S Joyner,Rev Martin Luther King Jr.,President Obama, Wendy Koop,Charlie Chaplin (to name a few) and countless people who changed the world the way we know through ethics, technology, humanitarianism, invention and virtue of liberty and personality…This article is dedicated to the essence of humanity…

imagesThis has been a long pending article and my apologies for the delay…

2015 undoubtedly belonged to Marky Mark and his lovely wife Priscilla Chan a Vietnamese immigrant who both together rewrote history in Philanthropy following footsteps of greats like Mother Teresa, Bill and Melinda Gates, Ricardo Semler, TATA family, Jack Ma to name a few. Source:Woopidoo.com

mark-zuckerberg-priscilla-chanMarky Mark through the Chan Zuckerberg Foundation donated 99 percentage of his shares in Facebook aka about $45 bn, to help “improve the world for the next generation.” Zuckerberg recently launched the Chan Zuckerberg Initiative whose initial focus areas will be “personalized learning, curing disease, connecting people and building strong communities.” This was one of the greatest humanitarian deeds done in humanity on the likes of some of the greatest philanthropists of modern times like Billy Boy, Semler to name a few. But the great part of the deed is not the amount of money but the age at which Marky Mark with his wife Priscilla Chan took the pledge to donate the money. But this was not the first time Marky Mark had done something like this. He had already donated $100 mn for an educational purposes to New Jersey public school system. Bill Gates along with his wife Melinda had set the standards in philanthropic initiatives at stratospheric levels when they had launched Bill Gates Melinda Foundation. The heavenly duo worked tirelessly for betterment of humanity and it is because of their initiatives and effort many milestones have been achieved including eradication of polio in Nigeria, proliferation of education around the world especially in developing world etc to name a few.

The whole universe including all the levels of heaven is Eternally Grateful and Deeply Obliged…

Now let’s look at some hilarious criticism to Facebook’s philanthropic commitment…

One of-course is that the initiative is to save money through tax breaks. What should I say to this hilarious accusation…Its like Mark Mark is ready to live in rags towards the end of his life so he can save a handkerchief to cover his body…

The LLC model is best to have control and measure the impactful value of philanthropy.

Let’s do some simple calculations. We look at a reasonable example

Considering Marky is still very young in his early thirties and decides to give even 90% of his wealth back for philanthropic purposes, so let’s see how the investment pans out over the years.  I did some very basic iterations and the real mode of donations will be a bit more complicated. Lets break 40 years into 8 phases
of equal years of 5 years. For sake of simplicity, Let’s ASSUME that Marky and Priscilla will donate at the end of this 5 year period. The donations are capped at 15% of the stock value initially the period of 10 YEARS THEN 20% FOR NEXT 10 YEARS, THEN 35% for next 10 years with 60% and 80% over the last 10 years.Over the 40 years, a steady rate of return of simple return for each period is assumed. There will be periods of Facecyclic recessions and financial crisis which might hurt the stock price over a shorter duration. The stock will give a very simple annual return of 2.4% per year for the next 40 years i.e. 12% every 5 years. This is a simple average considering there would be bubbles when the stock price might be at peak and it might take some time to reach back at previous levels. This calculation presumes no dividends and stock splits. The initial amount of Facebook is assumed to be $44 bn for calculations.

Hey Dude whats stock split?

Let say you have a stock of 100 and a one to one split is announced, so now you have 2 stocks while the stock price dips to 50. but it’s not so simple stock generally always rises above 50 and this is done by companies especially in the technology sector since the price reflects the future value of a company. As the stock price rises it becomes difficult for retail investors to buy more stocks.

In the above scenario, the stock gives 92 times the return of the stock price of Facebook. Return of 480% ( 12% per year) for the next 40 years actually could be ambitious but NASDAQ Composite has given a return of 9.5% per year over the last 30 years. ( Source: http://larrycheng.com/2010/01/01/u-s-stock-performance-over-50-years/)

I am giving a market premium of 2.5% to Facebook over NASDAQ Composite. Another way to look at the same would suggest that Facebook would have an alpha of 2.5% over NASDAQ Composite something Facebook should be able to perform easily. 

Beta is the covariance or correlation of stock with the benchmark index. Here Facebook is the stock and NASDAQ the benchmark index…0.75 beta suggests that Facebook is likely going to fall to 75 if Nasdaq Falls by 100 and gain by 75 if NASDAQ gains by 100. Alpha is the excess return generated over the benchmark index.

Usually, companies with higher Beta are likely to outperform the market considering they are riskier and tend to underperform also on a higher degree. But Facebook has Mark Factor also known as X Factor…So will put my money on Facebook…

The money donated over the period would be about $900 bn for philanthropic activities over 40 years which would change the lives of people forever. The above example is a very loose estimate of extrapolating the data.

$1 tr is the approx. amount of philanthropic money which could come over a period of 40 years in humanitarian initiatives. This is by far the largest amount of money donated by an individual entity and will be the greatest game changer in modern times.

Critics will say I am being too ambitious…Am I?

Let’s look at three bell weather stocks of technology companies which have defined the era we live in. GOOGLE, MICROSOFT AND FACEBOOK AND OF COURSE PAYPAL MAFIA… The companies chosen here are very similar in terms of business in technology considering they are services and software driven companies and comparable in many ways…

030911-ibm-stockb-100273275-origIf you had the good fortune to have bought 100 shares at the $21 offering price that day and sat on the investment for 25 years, it would have mushroomed into 28,800 shares over the course of nine stock splits and be worth about three-quarters of a million dollars today.

Source: http://www.networkworld.com/article/2228727/data-center/if-you-had-bought-100-shares-of-microsoft-25-years-ago—-.html

Comparing the ROI from Facebook

Assuming you were able to purchase shares of Facebook at its IPO price of $38, you would have 26 shares. As of July 27, 2015, Facebook closed at $94.17 per share, and your investment would have been worth $2,448.42. Your ROI would have been 147.82%.

Present-Day Value From a Google IPO Investment…

Larry Dude at his best

Now my favorite innovative technology company…As of July 27, 2015, Google Incorporated Class A stock closed at $658.27 per share, while its class C stock closed at $627.26 per share. Currently, the initial investment of $1,020 would be worth $15,426.36, which is 12 shares multiplied by $658.27 per share plus 12 shares multiplied by $627.26. The return on investment (ROI) from these shares purchased at Google’s IPO would be 1,415.39%. Source Investopedia

Google did it in about 10 years i.e. the stock price went up by 14 times the initial pricing, so 20 times in 40 years is very conservative while 52 times is a bit more than moderate. Facebook should beat this estimates considering Marky will innovate, Priscilla will be pillar by his side while maxi baby will motivate him forever…But then the heavens will always be with Marky and his family…

According to UNICEF “ The primary school net enrollment ratio was 84% in 1999 and is estimated to reach 93% in 2015”. Recent studies have estimated one year of education brings a 10 per cent increase in an individual’s earnings while each additional year of education is associated with an 18 per cent higher gross domestic product (GDP) per capital. This example is just to show the importance of one of the most important sectors to eradicate poverty and help humanity. Even if $300 bn comes into humanitarian causes through Chan Zuckerberg Foundation over a period of 40 years, a whole generation of lives of underprivileged people will change. Melinda Gates Foundation inspired many Entrepreneurs and educational institutes to allocate more money in philanthropic causes and going forward Chan Zuckerberg initiative will motivate people to further give billions of dollars into humanitarian causes cementing United Sates as the philanthropic nation globally.

Hey Dude I want to buy Facebook shares… I also want to give to humanity…

Sure but also buy Google and Microsoft among others…

Sure

Hey Dude lets talk about present. Lord Buddha spoke to be in present considering future is impermanent…Good now lets look at the present…

2D274905980365-today-chan-140530-06.today-inline-medLove in Harvard

Marky met Priscilla in Harvard while he was cudgeling his brain to open a social network which would revolutionize social network and serve as a pattern change in social network. They dated for 9 years before tying the knot. A love marriage made in heaven…

Priscilla worked hard and excelled in studies and in her own right is a very successful Pediatrician professional and her resume includes undergraduate and graduate degree from the best academic institutions in the world.

Policy Change in America

If Americans  had passed a bill which would have required all the refugees from Vietnam to be cross checked and most likely denied immigration, world might not have had the spectacular success of Facebook as we know of it today. This is not to take away any credit from Marky one of my favorite dudes but maybe he might not have been so focused and lost in the labyrinth of Silicon Valley where there are many people waiting to take any decisive advantage of a brilliant idea. Its Priscilla who provided the rock and catalyst for Marky to become one of the greatest philanthropist of all time. If Facebook even remotely does good, the astronomical sum of money which will come into humanitarian causes will change the lives of billions of people. It will help educate underprivileged children while change the face of healthcare and technology. Further it will generate millions of jobs while fostering technology and creativity among all. In the parlance of cynical times especially in America, it is an immigrant who served as a catalyst to change the history of mankind and in more than many ways perspective of Americans around the world. Whether Priscilla is of Chinese or Asian origin is immaterial ? I could argue that Indian immigrants collectively have been more successful in America compared to other immigrants, Russians played a fundamental role in ascent of complex financial products in Finance, Africans have excelled at sports and Chinese have also done phenomenally well across industries and so on. The whole idea is self-defeating. America means globalized society.Recent research has shown that its children of immigrants or immigrants outnumber Americans in higher degrees like Masters and even Bachelors. America was saved after its manufacturing sector became laggard due to Silicon Valley. A start-up ecosystem which is widely composed of some of the best talents around the world or its fantastic universities which encourages students around the world to come and conduct research regardless of their ethnicity, religion or color.

201404291128-UNICEF-Malawi-JMC_63521Last few months there has been a lot of media coverage to a particular candidate of Republican Party whose antics have caused a huge alarm and concern across people in America and World. But that is not the concern, the real concern is he is presently winning the race to nomination. Why has America become polarized so easily recently ? Is the person to be blamed or is he just the result of economics of a nation, part of which still adores and rewards extravagant excessive behavior. Its time people sat down and try to understand what is happening around the world…Hatred begets hatred…intolerance begets intolerance and racial division is the worst of its kind…

downloadSilicon Valley: Rise of Nerds..A Phenomena

Lets look at a piece of data. As Americans started attracting talent around the world through immigration, the productivity and income generation grew for Americans. As immigrants came to America, they worked harder and studied more. This led them to become more productive. As productivity grew in America so did the wages. With rise in productivity came creativity and originality. This led to more innovation and with technology, innovation proliferated. As innovation proliferated, Entrepreneurship grew. Rise in Entrepreneurship backed by a creative milieu of talent and fusion of culture backed by start up funding created an ecosystem of greatest intellectual capital in known period of history. This created a gold rush with a difference…For the first time in history the Nerds had power LIKE NEVER BEFORE. Never in history before could man or women command a measurable economic value to their intellectual ability and thus Silicon Valley was born…Bill Gates, Larry Page, Vinod Khosla, Marky are a product as well as catalyst of this phenomena.

Source: nationofchange.org

In the end it is in many ways immigrants and technological innovation which helped America immensely.

In the end there is no race which is intellectually superior on absolute terms. It is a relative advantage which is due to again natural economics which we will see going forward.

Hey Dude I am inspired. Even I want to work in Silicon Valley. I think I have            some talent

Really? I thought you wanted to become a rock star ?

No but after reading this article I think Silicon Valley is really Cool…

Howz that? Your knowledge in any topic is for the lack of a better word very             very limited… 

I could argue in parlance of modern times that Vietnam suffered due to misplaced policies of America and an immigrant from Vietnam maybe in many ways has sealed the image of America as a dream land for aspiring talented immigrants…worked hard…excelled both personally and professionally and then rewrote history of the World in humanitarianism.

Maybe America needs a NERD as a President.

Maybe its time a Technological Humanitarian ran for President…

Bill Gates run for President of United States of America…You will win by a mile.

Priscilla Chan along with Marky Mark are an exemplary example of both success at professional and personal level (like Bill and Melinda)…A paragon of character, ethics, knowledge, intellect, humanitarianism and spirituality. Both Priscilla and Mark define today’s youth and are superlative cultural icons…who have laid down a lifestyle path for billions to follow…In the end they are triumph of humanity and America…

To live in peace with everyone is in the best interests of humanity, so why do we always fight ? We should all do something constructive…Innovate or write or surf or run or teach or meditate or yoga but please be mindful since you are reacting all the time…

So whats the moral of the story Dude apart from Humanitarianism, Spiritualism and Intellectualism…

Hopefully a large amount of the money be donated to help people in Vietnam…build world class primary and secondary education, hospitals, colleges etc. In a small way maybe America could pay back something to Vietnam. See how nature intervenes to resurrect in its own way…maybe in a very small way…

Hey Dude I have tears in my eyes…You are the man…

Yes I am…Sleep on it…

I remember an iconic movie which had made a deep impression on myself when I was young…How Green Was My ValleyHow Green was America…Will always remember America as the land of opportunity for intellectuals and hopefully it stays that way…………………………………………………………………………………………

So what do you say fellows…Did you learn something…Involve in a humanitarian cause…

The Quintessential Dude…