How Indian Americans Came to Run Half of All U.S. Motels • Hacker News Board

Re: How Indian Americans Came to Run Half of All U.S. Motels

#51

Post by reaperducer » Wed, Sep 05, 2018, 7:35 PM UTC

justaguyhere wrote: post #25

stephengillie wrote: post #3

This model has led to success for other immigrant groups in other industries. > Many followed his advice. “They would give each other handshake loans—no collateral, no payment schedule, just pay when you can,” Doshi explains. Once a family purchased a motel, they would live there, and the family members would do all the tasks needed to run it, from cleaning rooms to checking in guests. That helped keep costs down, an…

I recently learned about oulipo ( https://en.wikipedia.org/wiki/Oulipo ) who create works with constraints (sometimes severe) and the results are quite amazing. Lack of resources can be sometimes a blessing in disguise whether it is literature or hard business. I wonder why Americans don't do this (maybe they do, I don't know) - why borrow from banks (or VCs etc) with strict strings attached, instead of supporting on…

based on trust?

Because there is a general lack of trust of people outside one's immediate family and a (usually very) small circle of friends.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#52

Post by TangoTrotFox » Wed, Sep 05, 2018, 7:37 PM UTC

siruncledrew wrote: post #34

sidlls wrote: post #28

Earlier quoted context omitted.

It's not (just) that most Americans feel these jobs aren't worth their time. There is a very strong individualist streak in American culture and a very strong taboo against lending friends or family members money for any reason. There are plenty of American families who have relations who could easily help bootstrap a profitable small business in the way described here. It just doesn't happen that way very often. Ins…

Jeff Bezos also got a loan from his parents. Having parents with disposable capital in the >$50k range is definitely not something the majority of American families can provide. https://medium.com/@timconneally/companies-started-by-loans-...

"When he was 17, Musk left college and moved to his mother’s home country, Canada, later obtaining passports for his mother, brother and sister to join him there. His father did not wish him well, Musk recalls. “He said rather contentiously that I’d be back in three months, that I’m never going to make it, that I’m never going to make anything of myself. He called me an idiot all the time. That’s the tip of the iceberg, by the way.”

After Musk became successful, his father even took credit for helping him – to such a degree that it’s listed as fact in Elon’s Wikipedia entry. “One thing he claims is he gave us a whole bunch of money to start, my brother and I, to start up our first company [Zip2, which provided online city guides to newspapers]. This is not true,” Musk says. “He was irrelevant. He paid nothing for college. My brother and I paid for college through scholarships, loans and working two jobs simultaneously. The funding we raised for our first company came from a small group of random angel investors in Silicon Valley.”"

https://www.rollingstone.com/culture/culture-features/elon-m...

Re: How Indian Americans Came to Run Half of All U.S. Motels

#53

Post by satya71 » Wed, Sep 05, 2018, 7:40 PM UTC

lotsofpulp wrote: post #48

emodendroket wrote: post #40

Earlier quoted context omitted.

I've wondered about this, but what I've heard is that few Indian families eat out very often.

Indian food is labor intensive and uses expensive ingredients. Restaurants are also low margin businesses that don't scale well and are super risky, not something I'd advise someone to do unless they have a passion for it and ability to fail and carry on with life. I have not been to a single Indian restaurant that can compare to a home cooked Gujarati meal, especially made by someone who grew up there.

You should try Rajdhani in Artesia, CA if you get a chance. But that's the only one I have found.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#54

Post by mrep » Wed, Sep 05, 2018, 7:40 PM UTC

sidlls wrote: post #28

stephengillie wrote: post #3

This model has led to success for other immigrant groups in other industries. > Many followed his advice. “They would give each other handshake loans—no collateral, no payment schedule, just pay when you can,” Doshi explains. Once a family purchased a motel, they would live there, and the family members would do all the tasks needed to run it, from cleaning rooms to checking in guests. That helped keep costs down, an…

It's not (just) that most Americans feel these jobs aren't worth their time. There is a very strong individualist streak in American culture and a very strong taboo against lending friends or family members money for any reason. There are plenty of American families who have relations who could easily help bootstrap a profitable small business in the way described here. It just doesn't happen that way very often. Ins…

> There is a very strong individualist streak in American culture and a very strong taboo against lending friends or family members money

For friends and extended family, I agree. However, most people I know have borrowed from their parents for things like their first car or the downpayment on their first house if they need to. Is that not normal?

Re: How Indian Americans Came to Run Half of All U.S. Motels

#55

Post by stephengillie » Wed, Sep 05, 2018, 7:41 PM UTC

monocasa wrote: post #24

stephengillie wrote: post #3

This model has led to success for other immigrant groups in other industries. > Many followed his advice. “They would give each other handshake loans—no collateral, no payment schedule, just pay when you can,” Doshi explains. Once a family purchased a motel, they would live there, and the family members would do all the tasks needed to run it, from cleaning rooms to checking in guests. That helped keep costs down, an…

Really? The killer app here seems to be access to capital on amazing terms. > They would give each other handshake loans—no collateral, no payment schedule, just pay when you can

They don't say how big is the loan, nor how many were needed to buy the hotel. They might have had to shake hands with everyone in their family.

Some Asian immigrant families form a "lending circle" where they choose a member to go 1st, and everyone gives their extra money to that person, and they buy a hotel/restaurant/etc. The circle chooses a 2nd, and everyone gives them spare money - it's a lot faster this time, with the one hotel/restaurant/etc owner paying in a relatively large amount. This goes around until everyone in the group (maybe 12-20 people) has a hotel/restaurant/etc.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#56

Post by logfromblammo » Wed, Sep 05, 2018, 7:43 PM UTC

sidlls wrote: post #28

stephengillie wrote: post #3

This model has led to success for other immigrant groups in other industries. > Many followed his advice. “They would give each other handshake loans—no collateral, no payment schedule, just pay when you can,” Doshi explains. Once a family purchased a motel, they would live there, and the family members would do all the tasks needed to run it, from cleaning rooms to checking in guests. That helped keep costs down, an…

It's not (just) that most Americans feel these jobs aren't worth their time. There is a very strong individualist streak in American culture and a very strong taboo against lending friends or family members money for any reason. There are plenty of American families who have relations who could easily help bootstrap a profitable small business in the way described here. It just doesn't happen that way very often. Ins…

If I ever loaned my family money, I'd make them sign a secured, transferable note and then sell it off as quickly as possible.

I'd rather extend a monetary gift without any expectation of repayment.

Any money-related issue is bound to sour relations with your family sooner or later. Business partners that fall out can go their separate ways, but when your sister-in-law cheats her siblings out of their shares of the estate--because she opened the account for her Mom, and it was a joint account, just in case something happened to her--that brews some resentment.

Loans make you involved in the borrower's business, and when things so bad, you need to be able to exercise all your options. Your lazy brother-in-law probably isn't going to prioritize making the loan payment to you over buying a new snowblower, or whatever other toy. Your sleazy brother-in-law might just default, claim your loan was actually a gift, and all but dare you to sue him. So it isn't just that there is a taboo against lending, but there is an insufficiently strong tradition of honoring personal commitments and sacrificing of one's self for the sake of the family.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#57

Post by whatshisface » Wed, Sep 05, 2018, 7:44 PM UTC

mrep wrote: post #54

sidlls wrote: post #28

Earlier quoted context omitted.

It's not (just) that most Americans feel these jobs aren't worth their time. There is a very strong individualist streak in American culture and a very strong taboo against lending friends or family members money for any reason. There are plenty of American families who have relations who could easily help bootstrap a profitable small business in the way described here. It just doesn't happen that way very often. Ins…

> There is a very strong individualist streak in American culture and a very strong taboo against lending friends or family members money For friends and extended family, I agree. However, most people I know have borrowed from their parents for things like their first car or the downpayment on their first house if they need to. Is that not normal?

In including "circumstances of birth," the parent is implicitly making a division between friends/near family and immediate blood family. Americans usually are willing to help out their direct descendants, often willing to help out their parents and grandparents, and rarely if ever willing to loan money to a nephew or college buddy (more than $50). The reasoning behind this is that business relationships can become incredibly sour, and "never seeing them again" is a pressure release that exists among strangers in New York but not among close family or best friends.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#58

Post by iguy » Wed, Sep 05, 2018, 7:47 PM UTC

stephengillie wrote: post #3

This model has led to success for other immigrant groups in other industries. > Many followed his advice. “They would give each other handshake loans—no collateral, no payment schedule, just pay when you can,” Doshi explains. Once a family purchased a motel, they would live there, and the family members would do all the tasks needed to run it, from cleaning rooms to checking in guests. That helped keep costs down, an…

There's an interesting ancient pattern of small minority groups dominating certain businesses, often ones which need trust -- here "handshake loans", but traditionally also simply payment for goods shipped long-distances.

e.g. The Greek trader in one little Egyptian town could be more confident in dealing with another Greek trader somewhere in Italy, a week's sail away, because while he might be tempted to run off with the money, word would get around, and soon no other Greek would trust the guy, nobody would marry his sons... he'd be ruined by expulsion from his community. This mechanism didn't work for people from the majority community, because they weren't so specialised, could do other business, could find another priest... Thus the Greeks could ship things cheaper, and won the business.

The Patels, and related Gujarati groups, have been in this kind of trust-heavy long-distance trade for centuries. They spread all over East Africa in the 19th C, and did very well.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#59

Post by overcast » Wed, Sep 05, 2018, 7:47 PM UTC

CodeCube wrote: post #26

If you are interested in these kinds of stories, check out the documentary http://www.thesearchforgeneraltso.com/ Aside from being specifically about searching for the origin of the general tso recipe, it talks about how chinese immigrants came to own so many chinese restaurants across the country.

Just recommended this film today to someone! Definitely worth checking out, even outside your interest of what General Tso actually is.

Re: How Indian Americans Came to Run Half of All U.S. Motels

#60

Post by lolsal » Wed, Sep 05, 2018, 7:48 PM UTC

reaperducer wrote: post #49

wdewind wrote: post #35

Earlier quoted context omitted.

Also access to cheap/free labor, also perhaps underaged labor?

Yes, having family members work for you for free is legal. My accountant once encouraged me to try to get my family members involved in a business I ran just for that reason.

I think the question of age comes into play though.