Facing Down Failure: Lessons from Asian Start-Ups

COVER

Tseng Ching-Tse (Panellist)
 
CONTENTS
 
Preface vi
Introduction

1

1. Identifying Opportunities 7
QLC.io: Enabling Millennials to Test-Drive Dream Jobs
    by Dr Sarah Cheah, Mr Luke Wu
13
I3 Precision: Improving Patient Safety and Healthcare Productivity
    by Dr Sarah Cheah, Dr Sarah Chan
27
2. Developing a Product and Service Offering 39
Vault Dragon: What’s in Store for the Future?
    by Dr Sarah Cheah, Mr Luke Wu
47
Tware: Commercialising Smart Wearable Tech to Touch Lives
    by Dr Sarah Cheah, Mr Luke Wu
61
3. Starting the Venture 75
Digify: Sending Important Documents Safely
    by Dr Sarah Cheah, Mr Luke Wu
83
Her Velvet Vase: Riding the E-Commerce Wave in Women's Fashion
    by Mr Luke Wu, Dr Sarah Cheah
97
4. Growing the Venture 111
InvitroCue: Biotech Startup from Lab to Stock Exchange
    by Dr Srinivas Bhylahalli, Dr Sarah Cheah
119
One Rochester Group: Remote Entrepreneurship
    by Ms Gwendolyn Lim, Ms Laurentia Yong, Mr Luke Wu, Dr Sarah Cheah
135
Conclusions 149
References 151
About the Editors 155
 
PREFACE
 

Anecdotally, nine out of ten new businesses end in failure. Why? And what keeps their founders trying to beat such formidable odds?

These are the questions we set out to explore by documenting the frontline experience of eight entrepreneurial teams. Each has climbed to a different level on the staircase that leads to success. While all their stories are unique, insights emerge from the common patterns in both their successes and their setbacks. Sharing those patterns in these case studies, we did not want merely to compile another list of cheery anecdotes and hand-waving advice about working hard, getting up earlier in the morning, and family being there through the dark times. We wanted to dig deeper to understand how real entrepreneurs made real decisions when things went wrong as well as right.

In particular, we wanted to explore the experience of new venture founders who were seeking to offer something new to the world from Asia. In the US and Europe, entrepreneur 'war stories' bulge out of bookshelves and fill blogs online, with American startups shouting loudest of all. Yet in Asia, entrepreneurs seem a lot more reticent. Studies by the Global Entrepreneurship Monitor (2014) have shown that only 59.7 percent of participants in the Asia and Oceania region accorded high social status to entrepreneurs, below those in the European Union and North American regions at 68.8 percent and 73.3 percent, respectively. It is evident that the Asian culture is less inclined to entrepreneurship compared to the American and European culture.

When we do see founding stories from Asian entrepreneurs, the stereotypical creation myths of the legendary family conglomerates that dominate Asia are just that: myths and legend (Studwell, 2008). They are told in retrospect, in authorised biographies that often feature a stern-faced founder on the front cover. They are overwhelmingly about older male tycoons, written long after the dangerous first years of business are past and with all the wrinkles in the story surgically removed.

The next generation of entrepreneurs might look up to such a tall tale and even find it inspiring. However, how are they to follow an act like that if they cannot see how the magic was done? All too often, the real truth is kept to the family dinner table. It passes privately to the next generation, consolidating insight alongside contacts and capital, leaving those living today in the humble condition where the founder first began believing that it can never be their destiny to follow in his footsteps. Thus can stories of heroes become disempowering.

In contrast, we are inspired by enlightened organisations like Endeavor (2016), a global movement that sets out to create support systems for high-impact entrepreneurs. It actively shares the know-how of entrepreneurial wealth creation across the world. Its members are all successful entrepreneurs who make a personal commitment to mentor those who follow them. Their objective is to pay it forward, trusting that their insights will cascade down generations not limited to one family. Likewise the local entrepreneurs who so generously let us inside their lives to research for this book. They share the view that lifting the curtain which hides new venture creation is vital if Asia is to gain as much economic and social benefit from entrepreneurship as the US, particularly the Silicon Valley, now enjoys.

Fascinatingly, prior studies suggest that entrepreneurs’ brains may be wired differently from the rest of us (Bryant and Terán, 2013), with perhaps 40 percent of the relevant genes inherited (Shane, 2010). However, any assertion that entrepreneurial success in general could be inherited wholesale or be unique to a particular group of people would be highly speculative (Fisher and Koch, 2008). What we can say for sure is that, today, anyone can learn how systematic entrepreneurship and innovation happen.

New technology has made it cheaper and easier to launch a global business than at any time in history. Armed with a smartphone and a data plan, any of us could reach out to the world and start making a dent in the universe. Most of us, however, have never even tried. Instead, we sell the bulk of the most precious thing we own—10,000 working days in an adult life—for a wage. Instead of trying to shape our world the way we want it, most of us labour to make someone else’s dream come true. Perhaps that is why, at some deep level, we are fascinated by entrepreneurs. In our imagination they are the rock stars of the working world. They strut on a bigger stage, bank bigger bucks, and do the outrageous things some of us wish we had the guts to do.

However, in reality none of that describes the entrepreneurs who shared their stories for this book. For the most part they are talented, of course, but also humble and in every way surprisingly ordinary. They would be the first to admit that failing is all too easy for startups, when founders find themselves swirling in a soup of uncertainty that is laced with temptation to yield to over-confidence, controlling passion, or false validation. Of the many stories that our research team gathered from Asian startups, we selected eight for this book to reflect a range of typical pitfalls they encountered. We aim to link their experiences to conceptual frameworks in the literature that we and the entrepreneurs found helpful as they rode out the risks and faced down failure. Where space has allowed, and with sincere thanks to the originators of these frameworks, we have summarised some of those big ideas. They are current at the time of writing but still evolving. So we urge readers to look to the original texts to enjoy more complete and updated treatments.

If this is all you read about innovation and entrepreneurship, perhaps using this book alongside a core study module and majoring in something else, we hope to leave you with a flavour of how exciting a field ours is becoming. At the other extreme, if you are a ‘wantrapreneur’, the resources that we list as references would be a great place to begin. Be warned, however, if you do decide to take that leap. We hear much about the stress that entrepreneurs face on what can be a lonely journey.

The good news is that this is changing. For individuals, awareness is growing of the consequences of the mental strain that startup founders willingly put themselves through. For communities, an increasing number of cities and governments are actively developing vibrant local startup ecosystems. Authors Victor Hwang and Greg Horowitt (2012) liken these ecosystems to rainforests that are conducive to the symbiotic growth of all types of life forms. So a healthy entrepreneurial ecosystem can simultaneously support the growth of mature trees (established companies) and foster the sprouting of weeds in every niche (young startups). At the outset nobody can tell which of today’s weeds will become tomorrow’s mature trees. Provided that the big stakeholders do not crowd them out, all have a fighting chance to prove themselves and contribute back to the ecosystem by supporting other life forms (such as creating employment).

Throughout this book, we underscore the importance of that ecosystem and its stakeholders. Bright ideas and a kick-the-door-down attitude are not sufficient. To achieve entrepreneurial success, startups require access to key resources, conducive market conditions, and a supportive regulatory framework. Thus one way to interpret the cases we present is to observe how our startup founders leveraged the innovation and entrepreneurship ecosystem around them by recognising and engaging with the specific stakeholders who controlled access to the critical resources they needed. Some startups gained access to leading-edge technologies by in-licensing intellectual property (IP) from public research institutes to complement their existing research and development stock (InvitroCue). Others used government grants to develop product prototypes for technology commercialisation (I3 Precision), while still more used public funding to develop internal capabilities in managing IP, branding, and franchising (One Rochester Group). Government support for entrepreneurs to enter international markets also features in these pages (Her Velvet Vase). First-time entrepreneurs had enrolled into an accelerator (QLC.io, Vault Dragon, and Digify) to gain instant access to networks of mentors, investors, corporate clients, research performers, suppliers, and distribution partners.

The journey from entrepreneurial zero to hero really is closer, more tangible, and more possible than ever before. If you, or someone you know, decides to give it a go, we wish you all the best and hope that the case studies and conceptual frameworks in this book convince you that it is worth trying to face down failure.

We thought we might end this preface with a reminder that without entrepreneurial spirit we would still be living in caves. Then it dawned on us that writing a book also feels like living somewhere dark for a very long time, with the light of publication a long way distant. In our case the journey to that light took two years. While we editors stand blinking, spotlit by sunrise as Facing Down Failure emerges into a new dawn, we want to acknowledge that this book truly could not have happened without the support of Professor Michael Frese and Professor Vivien Lim, and the commitment of startup founders, who took time out of their busy schedules to attend our interviews and address our queries. Our deepest gratitude goes to Magdalene Chan (Co-founder, Her Velvet Vase), Will Fan (Co-founder, QLC.io), Dr Steven Fang (Co-founder, InvitroCue), Augustine Lim (Co-founder, Digify), Teck-Sin Lim (Founder, I3 Precision), Joseph Ong (Founder, One Rochester Group), Janyn Sen (Head of Operations, Tware), James Teh (Co-founder, Tware), and Ching-Tse Tseng (Co-founder, Vault Dragon). We would like to express our appreciation to the mentors and investors who had accepted our interviews: Meng Weng Wong (Co-founder, JFDI.Asia), William Klippgen (Managing Partner, Tigris Capital), and Alphonsus Tan (Manager, National University of Singapore, Career Centre). Our heartfelt thanks to a team who mined deep into many nights to dig out, edit, and compile the research. Friends, students, and colleagues, we know how valuable your work have been. We and readers salute you, in alphabetical order: Norvin Chan, Cheung Ho Yeung, Adarsh Humne, Akash Kaura, Vivek Narayanan, Ng Jun Kai, Quek Keng Yong, Vishal Singla, and Henson Tay.

Sarah Cheah
Luke Wu
Hugh Mason

Singapore, July 2016

 
ABOUT THE EDITORS
 

Sarah Cheah (Moderator)

Sarah Cheah

Dr Sarah Cheah is Associate Professor with the National University of Singapore (NUS) Business School, with research and practice in innovation and entrepreneurship, as well as early-stage technology incubation and commercialisation. Since 2014, she has taught more than 1,000 undergraduates on entrepreneurship and mentored many technology commercialisation and startup projects. Her interest in entrepreneurship started in 2000 when she left a secure and well-paying job with a US multinational corporation to join the high-risk and high-churn startup workforce in Silicon Valley. After a few years of intensive scaling up to extend the startup footprint into Asia Pacific with more than 16 customer sites from a wide range of industries, Sarah joined the NUS Entrepreneurship Centre in 2003. As Adjunct Assistant Professor, she helped to build the local startup ecosystem by playing the role of educator in the Technopreneurship Minor Programme, mentor and coach to aspiring student entrepreneurs.

Trained as an engineer in computing and telecommunications, and equipped with extensive corporate sales and operation experience in mega projects, Sarah’s passion for tech-based entrepreneurship drove her to join A*STAR ETPL in 2009. As Vice President, she helped to accelerate the commercialisation of public-funded science through incubation and tech-based startups. In 2009-2011, Sarah spearheaded the 2-year Traineeship for Technology Transfer Management (T3M) Programme supported by A*STAR and Workforce Development Agency. The professional programme included coursework and hands-on training on entrepreneurship, intellectual property (IP) management, and commercialisation. Today the graduates of the programme play key roles in managing the entrepreneurship centres of many institutes of higher learning in Singapore. Sarah was also instrumental in the review of government policies pertaining to IP licensing, spin-off, and technology commercialisation, so as to foster a venture-friendly innovation and entrepreneurship ecosystem in Singapore. As a strong advocate of innovation-driven entrepreneurship, Sarah is an active member of the Youth and Entrepreneurship Chapter of the Action Community for Entrepreneurship (ACE). She is also a panel member of the Diagnostics Ecosystem Study commissioned by A*STAR ETPL. Using the twin approach of evidence-based policy and ground-up programmes, Sarah constantly seeks to grow the ecosystem as an activist, hustler, and influencer.

sarahcheah@nus.edu.sg
https://sg.linkedin.com/in/sarahcheah

 

Luke Wu

Luke Wu

Luke has been interested in entrepreneurship for as long as he can remember. In 2013, after completing his first year of university, he attempted his first foray into the business world with an Instagram printing e-commerce store which he operated with one home-printer from a university dorm room. One thing led to another, and in 2014, he co-founded Spark Asia, a mobile application that enabled data-driven content delivery through free printed photography. In just over a year since its launch, the company was valued at approximately S$1 million, established partnerships across the region, and had printed over a quarter million photos, amassing a rich database of over 15,000 registered users in the process.

In the few years he has dabbled in entrepreneurship, with the help of his colleagues, mentors, and friends, Luke has gained valuable experience in what it means to run a tech startup. He is always on the lookout for ways to improve the user experience, good advice, and networking opportunities.

While running his startup, Luke managed to find time to study and recently obtained a Bachelor of Laws with Second Class (Upper Division) Honours from the National University of Singapore. While still in law school, he was nominated for the Small Medium Business Association Young Entrepreneur Award 2016. Outside of school and work, he enjoys sports, good food, and drink, and applying the objective-strategy-tactic methodology obsessively to everything in life.

shineng.wu@gmail.com
https://sg.linkedin.com/in/shineng-luke-wu-a6a266112

 

Hugh Mason

Hugh Mason

Hugh is CEO at JFDI.Asia and Adjunct Associate Professor at National University of Singapore. Since 2012 he has co-founded, mentored, or invested in more than 70 startup companies.

Hugh’s Physics degree was sponsored by GEC-Marconi Research, where he worked on digital radar, radio propagation, and home automation. This technical background gave him the opportunity to train as a TV producer-director with the BBC’s Science and Features Department. He left the BBC with a commission to found his first business, an independent TV production company. It won a British Academy Award nomination making over 150 documentaries for Discovery Channel and National Geographic.

Building on his experience managing creative people and IP, in 2001, Hugh co-founded Pembridge Partners. This London-based investment and advisory firm raised over USD 50 million working with 300+ technology media and marketing firms.

In 2009, Hugh and his wife chose to raise their son in Singapore, where Hugh co-founded JFDI.Asia. As the first business accelerator in SE Asia, JFDI proved pivotal in kick-starting Singapore’s entrepreneurial ecosystem, deploying approximately USD 3 million into a portfolio of 70 very early-stage startups across Asia, achieving 48 percent IRR. JFDI has also supported over 1,000 start-up founders through its outreach programs and thousands more through hundreds of networking events, startup weekends, and hackathons.

hugh@jfdi.asia
@hughmason
https://sg.linkedin.com/in/hughmason

 

BACK TO MAIN

 

Dr Mabel Chou (Moderator)

© 2016 NUS Business School. All Rights Reserved | Terms of Use | Privacy | Non-discrimination