Chris Leong

Disoriented views from the rosy lens of an optimistic realist.

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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What is success?

I saw this great video from my friend’s blog – Sybreon Ones Nought. I find it very true and want to share it.

There are some things success is not.
Its not fame.
Its not money or power.
Success is waking up in the morning so excited about what you have to do that you literally fly out the door.
Its getting to work with people you love.
Success is connecting with the world and making people feel. Its finding a way to bind together people who have nothing in common but a dream.
Its falling asleep at night knowing you did the best job you could.
Success is joy and freedom and friendship.
And success is Love.

This are all important points for you to consider when you want to venture to business. Many entrepreneurs are successful because they love what they do. They are fulfilled and enjoy all the work that comes along with the business.

Are you excited with what you are doing?

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

Is Friendster better off with MOL?

mol friendster_logo_detail

In the last post, i had talked about losing mind share in US. However, Friendster is still very strong in Asia, especially in Malaysia and Philippines. Friendster is the #11 site in Malaysia and #6 in Philippines (Facebook is the #1 in both countries). However they have been losing market share for a long time (Friendster used to be the top site in Malaysia)

So the key question now is, Is Friendster better off with MOL than on their own?

The answer is YES for me on paper. Here are some reasons:

  1. Friendster can only survive by being a niche social media player.  Friendster is strong in Asia but they are still an American company (Australian CEO). So fundamentally, their insights on being a niche Asian Social Media player is limited. Therefore MOL will be able to provide these insights (Especially with Malaysia as one of their strong market)
  2. MOL is strong in Berjaya Group (Majority owner of MOL) has many B2C businesses like U-Mobile, Hotels and its many F&B Franchise business (Kenny Rogers, Wendy’s ETC. Avenues of monetising Friendster can be easier.
  3. With MOL already strong in Micro-Transaction, they would have the experience to monetize Friendster’s users. MOL and Friendster shared the same target market.

However, MOL is facing an uphill task. They need to settle down quick. Here are some of my key worries.

  1. MOL’s strategy of using Micro Transaction, Social Games and Music make sense but execution might be difficult as MOL has no prior experience managing a Web 2.0 company. Can MOL afford to make any rookie mistakes? Can they effectively manage cross culturally?
  2. Does Berjaya have the vision to stay with Friendster for the long run? Berjaya’s track record with MITV is not exactly fantastic. Will they see enough value in Friendster to invest more money if the goings get tough?

Friendster is losing mind share in the US – Try searching Friendster in Amazon

friendster_logo_detail large_flag_of_malaysia

Friendster is now Malaysian. Malaysia’s MOL has just bought Friendster a couple of weeks back for an undisclosed sum. It was rumored to be at the region of USD 26 million, a large sum of money considering the fact that they have been losing share and mindshare to Facebook. While I am happy that Malaysia finally have a global Web 2.0 company, I am skeptical on how Friendster can stay relevant in the Social Media sphere with the Goliath Facebook gaining market share day by day.

That skepticism was magnified when I tried looking for some books about Friendster in Amazon. The top 2 books that I found are Woman Loving Woman and Threesomes, Friendster has lost so much mindshare that it is even not featured in Amazon’s search engine . Not even one Friendster book is featured in the first 3 pages!

Friendster in Amazon

I hope Friendster’s 3 prong strategy on Microtransaction, Music and Social Gaming works. Or else, it will be a very expensive lesson for MOL.

All the best Friendster!! I agree with GreyReview, you need a fair dose of luck, lots of it!

Updated: In a different post, I mentioned that  Friendster is better off with MOL than on its own. Berjaya offer so much more value for Friendster to make money. I’m still skeptical, but I will be very happy if MOL can turn around Friendster. It will definitely improve Malaysia’s brand..

Sorry for not posting

The reason that i’ve not been posting lately is basically to have some time to reflect on how should i position my blog. So stay tune for more news