During a holiday to Penang Island, Malaysia, he figured it would be a perfect place to build a second home. “It was not as laid back as Goa but not as fast paced as Singapore,” he says.
He shifted base soon after. Wellconnected by flights, Penang offers the comforts of the First World and the joys of a small beach town. His bungalow is part of a marina complex and facilities such as grocery shops, pubs and cafes are within walking distance. His children are the happiest. Apart from good schools, they also enjoy safe atmosphere outdoors, where they can cycle around without a chaperone.
Malaysia’s MN1H2 visa programme, which allows retirees to come and live in the country, made the logistics of shifting easy. “That’s what money can do for you today,” he says.
At least three of Bansal’s close entrepreneur friends have shifted base to Asia or Europe. “In the past, too, people had money. But they had a geographical anchoring.” Most old-economy businesses were either in trading or manufacturing, and this limited the ability of a person to shift, bag and baggage. “Today most of us have made money in the digital businesses and mostly operate in the virtual world. Shifting base is a lot easier. Even our wealth is a lot global and can be accessed from anywhere,” he says.
Welcome to the world of a new breed of rich in 21st century India. The way they make money is different, and the way they spend is also different. Capital heavy investments and machinery are not required to make it big anymore. Companies are built on ideas in the digital era, and algorithms. For the lucky ones, a meteoric rise within a short span is an eminent possibility. Flipkart cofounders Sachin and Binny Bansal became billionaires within a decade.
The material wealth and bling that money can buy are typically used to mark the social standing of a person. But for the new breed of rich, the markers of their status have changed.
Take the case of a Mumbai-based firstgeneration entrepreneur who is passionate about fitness. He frequently takes a chartered flight to Goa with a bunch of friends to swim. “The joy of swimming in the clean, open sea is incomparable,” he says.
Another first-generation entrepreneur- t u r n e d -philanthropist says he doesn’t mind travelling economy class, sleeping in a $10 tent in Thailand or going on a Rs 2,000 trekking tour in Himachal Pradesh. The resident of the tony Lutyen’s area in Delhi says: “It is very easy to get disconnected when you are rich. You have to make an extra effort to stay grounded.” He, however, has no qualms in spending when required. The entrepreneur has hired a top-notch luxury travel operator to plan and curate his upcoming family vacation to South America. He also goes to the Swiss Alps regularly on skiing holidays.
The change in the markers of the new rich in the 21st century can be seen across the world.
Marked by intangibles, the technology-led era is shaping a new kind of capitalism. It is also creating a new code of conduct for the rich club. This club once stood out for its conspicuous consumption, revelled in its exclusive status, prided in its wealth and flaunted its pedigree. Traditionally, in society, consumption was seen as a social positioning system. Companies invented extravagant products to satiate this club’s aspirational urges and reinforce their exalted status. But a nuanced shift is now taking place and the rules of the membership are changing.
Because consumerism has been democr a t i sed, conspicuous consumption is no longer an aspirational marker. “Material spending today must have a qualitative spin to it,” says Santosh Desai, CEO, Future Brands.
Conspicuous consumption — the use of goods like flashy cars and bling to mark wealth in society — has been losing its charm for some time now. Multiple factors — including modern capitalism, mass production and rising incomes — have made such consumption more mainstream. Luxury product makers such as Armani’s Armani Exchange, Ralph Lauren’s Polo and Marc by Marc Jacobs have helped in the massification of luxury. The rise of sharing economy and the pay-per-use model has lowered the access threshold of luxury products and services. Access to private jets and yachts are not just limited to the uber-rich. Almost anyone can buy niche products and imported brands online.
Discreet consumption is in vogue now. Philanthrocapitalism, or investing in social programmes, is the new buzzword. Have no doubts, earning money still occupies the minds of the rich. But it is giving money that brings them status. Not surprisingly, The Giving Pledge is a new badge of honour that people like the Nilekanis and Azim Premji want to have. Capitalists with a socialist streak have become a common phenomenon. An evolved worldview on raging issues is the new bling.
Another parallel change has been afoot. Knowledge is today’s dominant currency and intellectual pursuits have a flaunt value. NR Narayan Murty’s son Rohan Murty setting up the Murty Classical Library of India is an example. “The elites display their wealth through cultural capital which is expensive but not ostensibly material. They use knowledge to attain higher social, environmental and cultural capital,” says Elizabeth Currid-Halkett, whose book, The Sum of Small Things – A Theory of the Aspirational Class, looks at how the 21st century rich behave and spend differently.
The rich now want to take position that need not be visible expensive but must necessarily be more informed. This makes being wealthy a tad difficult and also multifaceted. The books you read, what you tweet, the social media influence you have and the eclectic passions you pursue are all important signals. Look at the rich setting up art museums (Kiran Nadar and Piramal setting up museums of art) and theatre festivals (Mahindras and Munjals) in this light.
Increasing wealth has also led to a rise in inequality. Wealth concentration today is as high as in 1905, around when the term robber barons was coined. A Credit Suisse global wealth report says the world’s richest 1% owns half the earth’s wealth. It is far worse in India, where the top 1% has 73% of the wealth, according to an Oxfam report. The CEO society, once vaunted celebrities, face scorn. Several are dodging taxes. While the methods they use may be legal, these people are losing the moral battle. “The rich are anxiety-ridden. They grapple with self-doubt and moral conflict about their position in a highly unequal world,” says Rachel Sherman, the author of Uneasy Street: The Anxieties of Affluence.
Philanthropy today has surged with inequality. The rise of philanthrocapitalism and altruism’s flaunt value in today’s world must be seen in this light.
THE BOOKS: The 21st century digital era is giving rise to a new kind of elite, distinct from the previous century. A slew of books have looked at their rise and how they are reshaping the world:
“Capitalism without Capital: The Rise of the Intangible Economy” – coauthored by Jonathan Haskell and Stian Westlake
Capitalism in the tech-led era is different. The intangibleflavoured economy is shaped by a clutch of technology giants like Alphabet and Facebook with no physical assets. As a result, inequality and social polarisation is rising sharply.
“The Sum of Small Things – A Theory of the Aspirational Class” – Elizabeth Currid-Halkett
The rich in the 21st century behave and spend differently. Conspicuous consumption is out. Discreet inconspicuous consumption is in.
“Uneasy Street: The Anxieties of Affluence” – Rachel Sherman
Focusing on the lives of the rich, the books looks at the anxiety-ridden life of the liberal elites who believe in diversity and meritocracy, but grapple with self-doubt and moral conflict about their position in a highly unequal society.
“The Broken Ladder: How Inequality Affects the Way we Think, Live and Die” – Keith B Payne
Inequality is not the same as poverty. Inequality makes people feel poor and act poor even when they are not. This has a significant impact, including psychological.