Chris Leong

Disoriented views from the rosy lens of an optimistic realist.

Category: Funding

Key to start-up success

I was at echelon 2010 in Singapore and attended the Dave McClure’s keynote presentation where Dave McClure shared his thoughts on the future of internet start-ups (which is getting better and better) and why large VCs are not suitable for internet start-ups. Here are his slides.

Startup 2.0: A Silicon Valley Story

View more presentations from Dave McClure.

 

The most intriguing points about his presentation are what an entrepreneur should avoid and focus on in his/her venture. Here are good points that I’ve picked up:

  • Design and marketing skills are often lacking – Hire someone if your team do not have the skills.
  • Focus on user experience and distributing your product/services
  • Less is more – Focus on what your customer wants and use that as a basis to get feedback.
  • Early market validation – don’t wait for a year before you introduce your product to your customer.
  • Frequent customer feedback – have short development cycle to get frequent customer feedback

The detailed summary of the presentation is published here.

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Evaluating your business idea

A friend of mine, Bugs Tan has a great way for inventors and entrepreneurs to evaluate good business ideas. Bugs Tan is an award winning inventor who is very passionate in the field of innovation and entrepreneurship.

Based on his experience, he came out with a practical series of questions to help entrepreneurs and inventors to evaluate their ideas. I like these questions as it provides a very good perspective on how an entrepreneur should review the viability of their idea.

Do also check out Bugs’s blog to tap his thoughts on innovation.

Factors that attract VC to New Ventures

A friend of mine, Eliza Nordin is a VC and have recently did a great presentation on the subject “Factors that attract venture capitalist to new ventures”. Here are the slides to her presentation.

Follow her on Twitter to tap into her thoughts: elizanoordin

Overview of Teak Capital

Teak Capital is a venture capital management company based in Malaysia. Teak Capital currently manages   Teak Ventures Sdn. Bhd.’s funds and is also an appointed partner of MAVCAP under its Outsource Partners Programme (OSP) in July 2008.

What is a good business idea?

Before answering the question, What is a good business idea? Let me ask you this question, do you need a good business idea to start your business?

A long time back, my MBA professor once told me that your business idea do not need a competitive advantage to make money. The class was stunned but in many ways he’s right. There are so many businesses out there who does not have any significant competitive advantage but are making a decent profit.

Think of the chicken rice stall near your office. How do they fare compared to the best chicken rice in town? Not good enough i assume. But are they making money? You bet they are. But not as much as the extraordinary money that the best chicken rice stall is making.

people_around_good_ideas

So, do you need a good business idea to do business? No.

You only need a good business idea if you aspire to be the market leader in your industry. A business idea that allows you to earn extraordinary profit.

So what consist of a great business idea?

In my opinion, the human motivation of avoiding pain and increasing pleasure is a good measurement of an idea.

pain2

The best ideas generally have a mixture of both. Personally if given a choice, i like ideas that help customer avoid/remove pain. It is just human nature to have a bigger motivation to avoid pain rather than to seek pleasure.

The first step, for you to evaluate an idea is to identify the pain point of your customer and think of a solution to solve it. Make sure that the problem is so painful that the customer will gladly pay money to make it go away. (Those are the best ideas) In terms of pricing, you need to ensure the pain removed is bigger than the pain the customer feels when paying you.

Pleasure

What about pleasure based ideas?

Use the same methodology and identify how you are increasing the pleasure of your customer. Are you creating fun? Are you increasing sales for them? Identify them.

Careful though, if the business idea is a pleasure based idea, then you really need to identify whether your product/service is a “nice to have” (massage, spa, manicure & ETC).

If it is a “nice to have”  then you are exposed to what is called an elastic consumer goods/services. It just means that the higher you charge the lesser demand you have. Elastic goods/services are dependent on the current economy situation. People will cut back if they don’t have enough money and you also face the danger of a price war.

Here are some starting point for you to review your business idea.

Stay tune for the next post.

Budgeting for Cradle pre-seed grant

I’ve been meaning to write more about the entrepreneur scene in Malaysia, but I just can’t seems to find the time to do that. But I would like to share with any budding entrepreneurs that wants to apply for the Cradle pre-seed grant a useful budget spreadsheet.

Cradle Budget

Like any grants, Cradle’s pre-seed grant has rules on what you are allow to spend on. Based on the guidelines for the allowable expenses in Cradle’s website, I’ve devised a template to assist entrepreneurs to plan their expenditure. It is based on the allowable expenses stated by Cradle in their website.

Documentation on the allowable expenses by Cradle (As of 19 March 2010)

Download the Cradle pre-seed budget template.

P.S: Do feedback to me if you find any bugs in the template.

Enabling Your Business Ideas With Grants – Cradle Funds

Quite some time back, I wrote about some resources that Malaysian entrepreneur can check out to get their idea started. Cradle Funds had just launched its new commercialisation grant (RM 500k) to assist entrepreneurs in their ventures. Cradle has 2 grants, one for product development and one for commercialisation. With these 2 funds, Cradle had helped fill some of the gap in the funding ecosystem in Malaysia.

Cradle Funding Ecosystem

From what i understand, Cradle is keen to fund ideas/business that has technological innovation + potential to make money.So entrepreneurs “want-to-be”, check out the Cradle website to see how you can tap into it to kick start your ideas

Product Development Grants (CIP 150)

Cradle _TiE_A4

Commercialisation Grant (CIP500)

Cradle _TiE_A4

Attention Entrepreneurs – Resource to get your idea started

Recently I’ve been participating in many activities that involves in entrepreneurship or should i say the promotion of entrepreneurship. It’s always a fun and inspiring thing to do to talk to people who is so passionate and innovative.

I find entrepreneurs naturally very positive. They must be, else they will just stay employed. 🙂

I have many friends who have made it and many more who are just learning the trade. One thing i find very refreshing, in our country there are many opportunities for entrepreneurs to learn and get pre-seed funding.

Here are some of organization, clubs and events that is full of opportunities and information to help fellow entrepreneurs.

GEW (Global Entrepreneur Week)

GEW Malaysia

Here’s some info about what’s GEW about

For one week, millions of young people around the world will join a growing movement to generate new ideas and to seek better ways of doing things. Dozens of countries are coming together for the first time to host Global Entrepreneurship Week, a global initiative to inspire young people to embrace innovation, imagination and creativity. To think big. To turn their ideas into reality.

Cradle

Cradle fund

Interested in getting 150K to fund your ideas? Cradle is the place to go. If you have a good idea, check it out there. You will need to write a business plan and submit via their website. You don’t need to be an IT company. Any ideas that relates to technology. Check it out at the Cradle website

MDEC

MDEC & Microsoft Innovation Day

Similar to Cradle, you can get 150K to fund your ideas. MDEC work closely with Microsoft in promoting this to technopreneurs. Go to one of their events and check it out. Here’s the link where you can go. Microsoft Malaysia’s Innovation Day

Celcom Challenge

Celcom Developer Challenge

Another program by Celcom partnering with Cradle. You can get funding for you mobile ideas which will be the next big wave of innovation.

Malaysia Association of Creativity and Innovation (Macri)

Ok, you know there’s opportunities outside. How do you write the “right” business plan to get the necessary funding. Here’s where Macri can help. It is basically an inventor and entrepreneur club that you can go there to ask information about:

how to get Cradle/MDEC funding

IP protection

and various challenges that an entrepreneur might face

Go to their Macri’s website and join the Macri’s Facebook group