Some of us in the SG Entrepreneurs team are involved in the judging of the business plans for Start-Up@Singapore. Due to confidentiality, we cannot reveal much about what we have judged. However, there are some interesting lessons that can help to improve the quality of the executive summaries. Our resident contributor and co-founder of Entrepreneur27, Justin Lee draws from his recent experience in teaching RJC students with Bjorn and the judging of the executive summaries, and provides 10 tips to a better business plan.

Contributed by Justin Lee

I just completed scoring business plans for Startup@Singapore. A really interesting job. You may ask why am I doing this since I’m not some big shot entrepreneur.

Well I think you don’t really have to be a big shot entrepreneur to contribute. My Silicon Valley experience was extremely helpful because when I was there I trained myself hard at evaluating every opportunity or business model that I came by. My lecturer John also trained us hard and really grilled us hard. I realized this when I did the workshop on business plan writing to RJC students last weekend with Bjorn. A lot of what he taught was still fresh in my head, deeply etched somehow. So evaluating business plans comes quite naturally for me nowadays.

This is my second year helping out with Start-Up@Singapore. I was invited because NOC Alumni gets invited to help out and I felt it was an opportunity I couldn’t miss out on. Firstly to give back to the community and secondly as training for myself. The training is fantastic because you get to see things from the other side, the investor side of things.

For every plan that I read, I asked myself, “Would I put my own money in?”, “How can I offer suggestions to improve the plan for the entrepreneurs?”

I can’t disclose the business plans for confidentiality reasons but here are some thoughts based on the plans I scored:

The 10 TIPS

1. Format your plans nicely: Some of the plans were just walls of text. I didn’t really feel like reading through it. (But I did as I wanted to make sure I understood everything before scoring)

2. Use Graphs: The ones with sales graphs stood out. I’m a visual person.

3. Use product diagrams: I’m surprised that some of the product ideas didn’t have product diagrams. One picture says it all actually!

4. Explain your technological advantage clearly: A lot of the plans didn’t explain clearly why their technology is so much better. Especially in the tech-field, it is important to explain what features are better than the competitors.

5. Consider the threat of Open-Source: I found that some plans in the IT sector didn’t consider that there were open-source applications out there that were free and could take away their competitive advantage anytime. Consider OS not just as a threat but also as an opportunity/strategy as investors are now still investing in open-source.

6. Explain your target market clearly: Don’t just say that you want to reach for the trillion dollar advertising market. It’s better to focus on a $100m niche within there.

7. Explain why you need so much money: Some plans didn’t even explain why they needed millions. To pay for rental, salaries, holidays? Huh?

8. Spend more on marketing: The company that markets the best wins. Don’t just spend like $50k on marketing and millions on development. Especially if it’s in the IT sector, you can no longer have 18 month long development cycles. If can start off with $50k, create a product and get it out to beta, I’d rather put money in such a model.

9. Make sure the numbers make sense. If you said the market size was $10m in the first year and project your company to rake in $30m by the 5th year, do you think this is reasonable? You might even be outgrowing the market!?!

10. Explain your team background. Some teams simply put their names on it. The thing about startups is that you invest in the people and not so much the idea. So it is very important for me that an executive summary talks about WHY the team is so good. Are you a genius programmer? Write it down. So what if you don’t have a business person on board and you’re all programmers? I think any investor would rather put money into a team of all programmers if they can whip up the next Google. So yeah, don’t treat an executive summary like a school project. Put in some background, put in some personality. That stands out!

Hope this has been as helpful to you as it has been to me.

So, the fifty million dollar question above will start to get most of us thinking. Oftentimes, we lament about our situation. Is it really true that we are not ready to make a company like YouTube or Skype in Singapore? How far are we from seeing the first successful company in the web 2.0 era? Our resident contributor and co-founder of Entrepreneur27, Justin Lee talks about the pros and cons on jumpstarting a success web 2.0 (not 3.0) story in Singapore and compares the infrastructure between Singapore and Silicon Valley.

Yesterday, Second Minister for Information, Communication and the Arts, Dr Vivian Balakrishnan said at the World Econmic Forum (WEF) in Davos that, “Singapore needs to attract individuals with bright ideas who can develop the next YouTube or the next Skype.”

Very interesting article to be plastered on the front page of our national newspaper of record, the Straits Times. Sounds like a call for participation?

The article then goes on to quote Dr Balakrishnan, acknowledging that, “The key thing is that the biggies are all coming from small groups of individuals with a bright idea. For us to get our share, we need to be able to attract some people with ideas and give them a launch pad to develop these ideas and plug into a global market… Singapore’s EDB prescription has been to attract MNCs and the refinement now is that we are also working as individuals.”

He then goes on to cite the case of Sim Wong Hoo’s Creative (ahem, again!) saying that, “The fact that Singapore created a sound standard shows that an invididual hiding in some corner, given half a chance, can make a global difference.”

Mind you, that was a case study from 20 years ago — before I even started to use computers. Mr Sim never went to University. He was what we would consider a ‘poly’ (polytechnic) guy. He stuck it out and has since made big money. But my point is that we seem to lack new heroes post-Mr Sim.

I respect Dr Balakrishnan for acknowledging that our country’s legislative and public policy framework would also have to evolve and keep up with the rapidly changing world of interactive and digital media. It is great to know that our Government acknowledges that more needs to be done. And recently, they seem to be quite “on the ball” too. Which is very interesting to see.

For a start, the Government is making the right moves in acknowledging that change has to begin from our schools. The Media Development Authority (MDA) has some interesting initiatives coming up under their i.Rock initiative which addresses that.

As of now, I don’t know enough specifics about their initiatives to make a comment. But I’d like to share with you what I think about this call for participation: to get Singaporeans to develop the next YouTube or Skype.

What I’d like to do is to consider the pros and the cons of doing something in Singapore. I’ll begin with the pros then the cons. Of course this is my very own opinion so please feel free to differ.

As an entrepreneur, it’s quite important to look beyond the hype and try to understand it at a more pragmatic level since you’re probably gambling with your own career. I’m not sure if I’m that qualified to give advice but I’ll share my thoughts:

The Bad:

a. Creative Technology is a nice entrepreneurial story but it doesn’t really connect with the young generation anymore. We didn’t get anywhere with Web 1.0 (probably only Interwoven, but it’s based in Sunnyvale) and we are nowhere on the radar with Web 2.0. It’s quite a tough to bring up new heroes when there haven’t been any right?

b. Niklas Zennstrom would probably have ended up in jail before he started Skype. I think Kazaa would have put him behind bars if he was in Singapore. Nuff said.

c. Chad Hurley would probably have ended up in jail if he started up YouTube in Singapore. Jailed for “copyright infringement” because we don’t have a DMCA.

d. We don’t have experienced backers (VCs) here… the Sequoias, Kleiner Perkins and DFJs. But this is a chicken-or-egg-which-came-first dilemma.
e. We don’t have an exit market here. No NASDAQ, no big companies to buy you out. Local startups like Hardwarezone didn’t score terrific valuations in their exit. You can either stay private or be globally oriented from day one I guess.

f. Banking is too strong and is sucking away all available engineering talents. Just talk to any fresh grad engineer or anyone from any faculty and ask them where do they prefer to work first. It’s even sucking away the accountants from accountancy firms. Nobody’s left to do book-keeping :(

g. Even making oil rigs at Keppel is more lucrative and substantial an industry. Yeah, with the 7 month bonus last year, it’s really quite attractive. :)
h. No cushion or career hopping prospects for great tech people here. In Silicon Valley, if you’re good, you start a firm. If it fails, you can say it was founded by a Top Tier VC and still get a job. There is a real job market with great compensation and great perks for startup people there because of the critical mass there. Not so much here because we are essentially still operating at an outsourcing stage where headcounts matter more than talents hence depressed salaries.

i. Our Poly talents have a better chance at hacking out cool stuff than our Uni talents because: They have a more practical based curriculum hence they’re much more adept at developing software right out of school compared to the University curriculum which is more theory based. I’ve seen this before when I participated in programming competitions many years back.

h. We don’t have a big natural market. The idea of a test-bed is dead. Surprisingly, Singapore is still promoting that. Test-bed is a 1.0 idea. Web 2.0 companies need “beta markets” not pilot test-beds. Test beds take too much time to go to market. YouTube didn’t need test-beds. Skype didn’t need test-beds. What they need is a user-base that can test, evangelize and hence help scale the company. Right now, the biggest natural markets are: i. USA for the anglosphere, ii. China for the chinesesphere, iii. Germany for germansphere and iv. Japan for japanesesphere. Unfortunately most of SouthEast Asia is still rather economically backwards to be of any critical mass for Internet startups. I don’t think we are even close to South Korea which is 10x our size.

i. Media coverage for the local scene. Currently I don’t think the world’s media is looking hard enough at our startups and our initiatives. Given that we’re a tiny speck, why would they spend their time here instead of scouring Silicon Valley. But from talking to people, I suspect we do have some gems. Unfortunately, they’re still in the rough.

j. Blog Media needs to be more active: Besides mainstream media coverage, we also need an active blog media. A community of people who holding endless conversations online. This will help spread the word on what’s going on in our scene. And I don’t mean bloggers posting up pictures of what they ate at the hawker centre and what they bought at the flea market.

k. National Service kills the spirit of our young men. I know this is a senstive topic but it’s true. After lagging behind for 2.5 years and ploughing through the workload heavy university curriculum, most guys are, just too tired and more interested to catchup with the girls in the rat race than start companies.

The Good:

So what’s good about Singapore?

a. We’re trying. Really. Pat on the back for all the effort by people working in the Government coming up with this and that initiatives. I can see that from the efforts of some friends in there. (Interestingly, the smartest people in Singapore work in the Government — at least from the kids my year.)

b. We actually do have money to give away. More money than good ideas and good entrepreneurs unfortunately. Hopefully things will change..

c. Compared to lots of other countries in ASEAN, we’re quite far ahead infrastructure wise. Everything works here so you don’t have to worry too much. The business climate is great.

d. We have good engineers. I think there are many good engineers here. Just that they’re somehow stuck in some BigCo. I wonder what would make them come out?

e. We have the guts to proclaim we want to host the new YouTube or Skype in front of the world. Quite interesting coming from Davos.

f. Living standards here are fantastic. Can’t ask for more really. This is a good place to bring your family.

h. Our universities are striving. You can see how strong the universities are now. We’re quite good at attracting the best students from the region too.

The Conclusion:

Despite all these pluses, we’ll have to first accept that we’ll always be second-tier, to China and Silicon Valley because of their large markets, infrastructure and eco-system that would be really difficult to trump.

It’s hard to skip ahead to be first-tier because the difficulty of pulling ahead is akin to climbing the powerlaw curve: the climb keeps getting steeper as you get closer to the peak.

Having recognized that we’re sort of in second place, instead of trying to beat everyone we could focus on certain niches. Doing stuff that no-one else can. Like Israel, they’re small but very focused and have built up a substantial community.

Despite all these, it’s still a good idea to try. Don’t give up everyone! It’s good to have a dream and a vision and try to figure a way to make things happen — despite all the odds.

Our young people could probably be peppered with a little more enthusiasm, energy and vision. I don’t know how we can solve that in one shot but maybe going for E27, Nexus or Barcamp could help a little?

I hope this has been helpful. :)

Plugs:

E27 is coming up again in February. Signup for our mailing list to keep informed. (The box is on the right sidebar)

Nexus is coming up in March. Signup for it too. Best deal $15 only. It’s a conference on steriods at a low low price.

BarCampSingapore was last weekend. But you can still stay informed of the next one.

Can Singapore produce our own YouTube? by Lim Der Shing, SG Entrepreneurs.

Get Money from SG Entrepreneurs. (Read the 2nd last para of this post.)

SINGAPORE: M2B World Asia Pacific Pte Ltd, a subsidiary of US-listed Amaru, Inc yesterday launched its news on-demand channel with Singapore Press Holdings (SPH) during a press conference at its newly opened showroom and media production studio. Our resident contributor and co-founder of Entrepreneur27, Justin Lee reports on this interesting event and shares his thoughts on this competitive media industry in Singapore.

M2B World Asia Pacific operates M2Btv, Singapore’s First Broadband TV. M2Btv is an IPTV media broadcaster that brings news and entertainment over the Internet to the TVs of its subscribers through custom set-top boxes.

The new SPH Video News Channel is compiled from AsiaOne, STI (Straits Times Interactive) and STOMP. This is in addition to the current offering of 55 channels of video on-demand entertainment comprising local and international programming as well as casual interactive games like Soduku.

Accessed through the Pony set-box using any high speed broadband connection, Singapore’s First Broadband TV service also provides M2Btv subscribers face-to-face video calls and messaging at no additional charges, along with online on-demand shopping.

M2B World currently reaches out to a regional audience of subscribers in Southeast Asia, China and the USA. The installed base just in Singapore would be expected to reach over 10,000 users in 2007.

At the unveiling ceremony, CEO Colin Binny said, “Since the launch of M2Btv last year, we have banked on continually expanding our offering of on-demand programming to deliver an alternative, value-for-money platform for home entertainment, with a rich array of content that has largely not been seen on free-to-air TV or cable.”

Also in attendance was a bevy of beauty queens who were winners of pageants sponsored by M2B World. They showcased the variety of offerings to be available on M2Btv including:

• The exclusive High Definition premiere of “The DaVinci Code”
• A Karaoke on-demand channel with up to 10,000 titles
• An original full high-definition Singapore documentary series entitled “Facets of a Nation” hosted by Lim Kay Tong

The M2Btv service is distributed over the Internet to specially designed “PONY” set-top boxes that incorporate a custom designed remote-control. Accessories such as microphones and web-cams can be connected to the device to enable video-conferencing.

M2Btv has also struck partnerships with retailer Harvey Norman and karaoke equipment retailer Electro-Voice to distribute its set-top boxes. Every purchase of an LCD, plasma or conventional TV at Harvey Norman will come bundled with a free 12 month subscription.

The bundle of attractive entertainment offerings, quality content and wide distribution could mean that the Singapore consumer looks set to gain with competitive offerings for the consumers by IPTV companies such as M2Btv.

After the formalities of the launch, Amaru, Inc CEO, Colin Binny brought the guests on a tour of its showroom and media product facilities.

The showroom is an impressive double-height ceiling suite with a wall of 9 large plasma-TVs on one wall. Behind the reception hall was a large digital production studio.

The digital production studio had a team of people working on round-the-clock shifts producing content for the web and the various channels. Various teams of employees worked on tasks ranging from video encoding to subtitling. The operational aspects of the company were well thought out and process oriented.

VP of Corporate Communications, Liew Kim Siong, explained that the entire system was web-based and enabled the company to work more effectively. The process of media production began in this studio (the company has one other studio in Los Angeles serving the USA market). Video content was first encoded and prepared for local consumption. They are then uploaded to server farms located in Singapore and USA for distribution to the set-top boxes.

In a personal interview, Colin explained to me that he started this company in 2000 as he saw a market for IPTV. It was difficult starting up a company then as it was in the wake of the Dot-Com crash. However, he believed in his idea and put in his own money by mortgaging his property. Eventually, he managed to raise additional investments to get the company going. To date over $30m dollars has been invested and the company is also listed on the NASDAQ stock exchange in USA.

When asked for advice for entrepreneurs, Colin emphasized that it was important not to try to do everything alone but to be willing to give up a part of your company to bring in good partners and financers. He also encouraged entrepreneurs to learn how to raise financing from the financial markets so as to be able to grow the company quickly.

On this blog, I think many of the readers and contributors are focused on the idea generation and starting up stage, but rarely do we get a glimpse into a company that has pulled past the early stages and is now expanding globally.

I hope this post has been valuable to you in providing a glimpse into the operations and marketing of a Singapore founded firm making inroads into the competitive IPTV market.

The M2Btv showroom is located at 112 Middle Road, 01-01 Midland House, together with M2B World Asia Pacific.

Justin: Can you tell me more about yourself? What did you do before founding FAQQLY?

Dave: I founded FAQQLY while an undergraduate at UCLA. I was studying Mass Communication, and more specifically, Internet communication and communities. Since I was 8, I knew I wanted to be an entrepreneur. It was when I was visiting relatives in Taiwan with my family that I received this revelation. During the trip, we stopped by my aunt’s sporting goods store. She had a little store in a very busy shopping mall in Taipei. I’m not sure what it was, but I was so attracted to the idea of owning and managing my own business that my life changed its course immediately… my first “company” was a candy shop on my elementary school playground. I purchased candy at bulk prices and charged a premium to the kids on the playground. Needless to say, a lot of my little classmates had candy for lunch that year, and I was quadrupling (or more) my allowance every week. Later on, at 13, I founded a web consulting and development firm called Shrezzi Design Group. And then at 16, re-founded the company under the name Ink21 Design Studios. We helped local businesses, individuals, non-profits, churches, and Silicon Valley startups develop effective web presences. And it was also then that we were covered by several SF Bay Area newspapers and some magazines such as the online version of Entrepreneur. Some of them are posted: http://www.daveliu.org
Over the past four years at UCLA, I’ve been very involved with churches, student organizations, internships, and different consulting projects. For instance, during my first year in college I had the opportunity to consult several more well known Asian-American actors on their websites (Parry Shen of MTV Films’ “Better Luck Tomorrow” and Keiko Agena of WB Gilmore Girls). And right before FAQQLY, I founded a campus church with a few other friends. I’ve always been a very active, entrepreneurial guy. My closest friends tell me I’m a hardcore workaholic and that I have a tendency to isolate myself in my work. So at the time, I’m trying to find a good balance between pursuing my passion (building authentic community online), and actually having authentic community offline. It’s kind of ironic, I know :)

Can you tell me more about this concept of social networking around questions and answers? I think social networking has always been missing something. It’s felt detached from the real world. It’s a static profile that you update every now and then. It really took off with Friendster, but died down because in the end, it was just a static profile. MySpace provided extreme customization which led to a bunch of young people obsessively updating their still static profiles. Social networking around questions and answers, and with the personal FAQ in particular, is a lot closer to real life conversation and community. What’s the first thing we do when we meet someone in real life? Well, if we’re new to each other, we probably strike up a conversation. Eventually, this initial conversation is more like an interview. Where are you from? What’s your major? What do you do? Are you married? Are you single? What do you feel like eating? Etc. The Myspace or Friendster or any community profile method is more like meeting someone for the first time and delivering a 15 minute speech about yourself. And possibly afterward, listening to their 15 minute speech about themselves. Social networking profiles are usually a lot more like self-broadcasting. To me, this isn’t authentic community. To me, this is actually one of the contributing factors to the stigma of online communities as a place for inauthentic interactions. But online community is a good thing in it of itself. I’m passionate about social networking around questions and answers because I think it improves online conversation and communication. Q&A helps people look beyond themselves and to others, and it also keeps profiles relevant. In the end, people still do broadcast about themselves, but more naturally and on the demand of their friends and visitors.

How did you come up with an idea like this? I designed Parry Shen’s early website back in my college freshman days. Parry Shen is the main actor in MTV Films’ Better Luck Tomorrow, and he is also on FAQQLY (www.faqqly.com/parryshen). Parry had a very extensive FAQ page. I remember putting it together, thinking to myself “hey, I want my own FAQ” and then “hey, what if everyone had FAQs”. The result of those “heys” is FAQQLY. I think our inadvertent “hey’s” should never be dismissed. Usually an inadvertent “hey, wouldn’t it be cool if they had…” or “hey, I wish this would be easier or better, etc” means an opportunity to improve the way something is done. If you find yourself wishing you could have this or do that, or even just thinking “wouldn’t it be cool if…”, then quick, grab a pen and paper and start jotting down your ideas. Maybe 90% of the time it’s been done or it’s actually a terrible idea. But every now and then someone spots a real need that people have and thinks up a way to serve that need.

What’s the pressing need behind why a user should use FAQQLY? Reason #1 FAQQLY makes life easier. People are already “doing FAQQLY” in their everyday lives. When we think of what goes on in an everyday community, we can think of several things: 1) getting to know each other (e.g. the first date is essentially an interview process of Q&A) 2) helping each other out (e.g. I need help promoting FAQQLY to Singapore.) 3) sharing with one another (e.g. I want to borrow my friend’s DVD or book) FAQQLY makes daily life processes simple and fun over the web. FAQ feature 1) It is much easier to ask more questions to more people over FAQQLY. Likewise, it is much easier to answer more questions from more people over FAQQLY. Helps feature 2) It is much easier to leverage your social network for help, either for favors, advices and suggestions, or knowledge about a subject over FAQQLY. Your friends solve your problems together as when you request for Helps on FAQQLY. Shares feature 3) It is easier and more organized to borrow and lend over FAQQLY because a) people take the initiative to post their list of borrowable items for their friends, and b) FAQQLY keeps track of what you borrow and lend out so that it’s harder to forget to return items (for instance, I still have my friend’s Fight Club DVD. I borrowed it from her in high school. I kept on forgetting to return it, and eventually I lost it. Oops. Not on FAQQLY.).

Reason #2 FAQQLY sparks opportunities for friends and acquaintances to hang out in real life How so? For one, the focus is less on self-promotion, and more on getting to know one another. I go out to learn more about you, you go out to learn more about me, and this potentially results in more personal content than if we both had to sit there and start writing about ourselves. There is never an end to questions. But what I really like about FAQQLY is its ability to get people offline and into real, face-to-face community as well. For instance, I ask for Helps saying “Can someone give me a ride to my job interview on Wednesday afternoon?” My friend offers to pick me up over FAQQLY. Well, this is awesome! But what is more awesome is that my friend is actually going to pick me up in person and along the way we’ll have a conversation, and I’ll remember how he helped me out (social capital was built), etc. The result of FAQQLY is real life community in this instance. Think about the Shares feature in the same way. I ask my friend if I can borrow his DVD. He says sure, where do you want to meet up for it? We’re meeting up to make the hand off. And hey, maybe we’ll even watch the DVD together and invite some friends to join us. This is where authentic community happens, in everyday, real life.

Reason #3 It’s fun. It’s useful. FAQ I like to think of it as an interview with all of your friends as your interviewers. It’s fun to be interviewed, and it’s fun interviewing others. Helps I have a friend who found her ride to her job interview off of Helps. She found her ride from an acquaintance who had nothing to do that day. I’m sure they got to know each other better on the car ride. I was really happy to hear about this. Shares I think it is awesome to never have to pay another rental fee at the video store. Imagine having 200 friends sharing an average of let’s say just 10 items per person. That’s 2,000 items at your fingertips to browse through and borrow. You might discover common or diverse tastes, or you might think “well, this friend and I have similar tastes, what else does she like? maybe she has something that I want.” Etc. There is more planned. We want to “upload” and adapt everyday life processes to FAQQLY

How do you see FAQQLY different from Google Answers or Yahoo Answers? Google Answers is more about expert help. They hire a few hundred consultants or experts to answer your questions. The type of information asked for and provided tend to be technical or research questions. The quality of information is certainly higher, but you literally pay for it. Yahoo Answers is very interesting. They’ve picked up quite a bit of activity lately, and have caught the attention of the press. I heard they just hit 10 million questions and answers. I’ve been following them more closely these days as it seems that Yahoo putting more attention and resources on it. How is FAQQLY different? Yahoo and Google Answers are both about information, not about people. Their communities are formed around information. Our communities are formed around friendships. Most of the information exchanged over FAQQLY is personal information, or conversation. Pete Cashmore at Mashable! calls us a Myspace meets Yahoo Answers. I think this analogy is right on.

What were your considerations before starting this? Especially since you’re still in school? At first I thought I would be able to throw this thing together, no problem. (I was a lot more naive then.) So when I first founded FAQQLY, I had no idea that within the next year or so I would temporarily drop out of school to work full-time on it. There weren’t many considerations. Costs of a web startup are low. My dad threw in a few thousand dollars to help get us started. And I had a significant amount of web and team management experience from past entrepreneurial ventures, consulting projects, and internships. It took me a while to find the right mix of teammates, and off we went. I decided to take a quarter off this past quarter of school to work full-time. A global tech company called VIA Technologies, Inc. found us and we partnered up to work on an educational portal for one of their special community projects in Asia. So even before the end of the year, I packed my bags and went from Los Angeles to Fremont (SF Bay Area) to work full time at VIA’s US offices. It was difficult leaving my girlfriend and friends behind, but I felt that this was the opportunity of a lifetime and I had to pursue it with everything I had. For the record, my girlfriend and friends have been amazingly supportive (for the most part). However, my girlfriend now developed an aversion towards my Sprint PPC-6700. It’s an HTC SmartPhone that I use for phone calls and web and e-mail, mostly for business. I think I would be lost without my faith, girlfriend, friends…. and PPC-6700.

How did you bring together your team, could you tell me more about the challenges you faced? Did you face obstacles because you were young? I brought together the team through A LOT of networking and interviewing. It was very hard to find the right mix of people I felt comfortable working with. At times I just wanted to “satisfice” and work with what I had. But I am glad I toughed it out and waited (i.e. actively searched) for the right partners and teammates that I could work best with, and that I knew gave FAQQLY the best shot at success. Challenges? It was difficult because there were at times personality and vision conflicts. And making it more difficult, sometimes friends were involved. It’s also incredibly hard to find students to staff your startup team who share the same level of commitment and drive for your startup. Students are hard to secure. For instance, they have a relationship problem with their girlfriend. Or maybe they are going through midterms, finals, etc. We’re young. Our peers and even ourselves, we may be more prone to these ups and downs. And you know what we don’t have to anchor us down (at least most of us in college)? We don’t carry the ultimate responsibility to pay the bills, feed ourselves and our families. When you hire a guy that needs the salary to pay the bills and support the family, you’ll get a dedicated guy! Even if you pay students, I think you will never find the level of commitment that you can find in someone that depends on your company to survive. Long story short, finding the right people can be incredibly tough. If by chance you do find the right people, be good to them and hang on to them for dear life! I think being young can be good. The right people might just have a heart to help you out because you’re young and ambitious (again, make sure you believe in what you’re doing and why you’re doing it, and then others will also). I also think that if you are considering a low-cost venture, then do it. Right now I don’t have a family to support. And actually, my family is supporting me still. What do I have to lose? If I wait any further, am I really going to get around to starting up? Realistically, probably not. The longer you put it off, generally, the more responsibilities and obligations you’ll have to your current job or to your future family or etc. If right now the only thing stopping you is you, then you are in a good place (in the time line of life) to startup. It is impossible to find the perfect team.

Continuing with David Liu’s tips for young entrepreneurs….

]]> http://sgentrepreneurs.com/singapore-entrepreneurs/2006/07/02/an-interview-with-faqqlycom-founder-david-liu/feed/ 0 http://sgentrepreneurs.com/contributors-corner/2006/06/26/singapore-batam-bintan-special-economic-zone-will-that-lift-our-fortunes/?utm_source=rss&utm_medium=rss&utm_campaign=singapore-batam-bintan-special-economic-zone-will-that-lift-our-fortunes http://sgentrepreneurs.com/contributors-corner/2006/06/26/singapore-batam-bintan-special-economic-zone-will-that-lift-our-fortunes/#comments Sun, 25 Jun 2006 16:11:51 +0000 justinlee http://sgentrepreneurs.com/contributors-corner/2006/06/26/singapore-batam-bintan-special-economic-zone-will-that-lift-our-fortunes/ What is a special economic zone? What is a free trade agreement (FTA)? How does our economy flourish by establishing special economic zones (SEZ) with Indonesia (Batam and Bintan). Our contributor, Justin Lee discusses the implications of such economic activities that will help those who are looking for entrepreneurial opportunities out there.

Contributed by Justin Lee

Today, Singapore’s Prime Minister Lee Hsien Loong signed an agreement to setup a Special Economic Zone (SEZ) in Batam and Indonesia with Indonesian President Susilo Bambang Yudhoyuno.

The Indonesian leader described the signing of the agreement as a historic event.

It is hoped that Batam, Bintan and Karimun will regain its status as the thriving hub of business activity that it once was.

With keener competition from China, India and Vietnam, many companies moved their operations away from places like Batam, and the business climate there began to freeze in early 2000.

Not bad, I like this idea. I think this agreement underscores our understanding that we are getting expensive and that any successful global city requires a vast hinterland and cheap sources of production.

Singapore has always recognized that we are small and our approach has always been to go virtual.

That’s why we’re working on so many Free Trade Agreements. Because it’s our only salvation. It helps us to expand our boundaries “virtually”.

Just look at the following list of FTAs that we’ve signed:

• ASEAN Free Trade Area
• Australia
• European Free Trade Association
• Hashemite Kingdom of Jordan
• India
• Japan
• Korea
• New Zealand
• Panama
• Trans-Pacific SEP (Brunei, New Zealand, Chile, Singapore)
• United States

And the following that are in the works:

• ASEAN & the People’s Republic of China
• ASEAN-Australia and New Zealand FTA
• ASEAN-India FTA
• ASEAN-Japan Comprehensive Economic Partnership (AJCEP)
• ASEAN-Korea FTA
• Bahrain
• Canada
• Egypt
• Mexico
• Pakistan
• Peru
• Sri Lanka
• State of Kuwait
• State of Qatar
• United Arab Emirates

(I took this from fta.gov.sg)

From an initial glance, there is actually a great amount of opportunity. I lament that fact that young people probably don’t know much about this.

I think this is important knowledge to have because by beginning to study these FTAs we can get out of our mindset that ‘Singapore is a small place’.

You see, yes the United States sounds like it is one big homogeneous market. But from my experience, there are actually lots of different rules and laws across the different states.

So besides having to understand cultural differences between the East Coast, West Coast and the Midwest, an entrepreneur in the US has to understand legal differences too.

Hence, I’d like to suggest that instead of limiting ourselves to thinking that “Singapore has a small market”. We should really begin to consider how we can take advantage of these FTAs.

Our FTAs are definitely one of of the best things that our Foreign Ministry has churned out. Ever so diligently, they seek to increase our size “virtually”.

Training the Next Lap

Actually, I think that the entrepreneurship/business classes in University should include a class about “Taking advantage of our Free Trade Agreements”.

This would help start students of entrepreneurship off by equipping them to really understand the policies, benefits and implications of such agreements.

By doing so, it will help to create sufficient understanding amongst local entrepreneurs so that we can grow a new generation of local companies able and savvy enough to take advantage of these new policies.

Bintan, Batam Special Economic Zone (SEZ)

I think this SEZ is significant, simply because it’s so close to home.

Also, previous SEZs have not worked out well (like the Suzhou one). So I hope we’ve learnt something from those episodes.

With this agreement, Singapore now truly controls the Straits of Malacca. (We hope)

Don’t underestimate this. Because 1/3 of the world’s trade in physical goods reportedly flows through this Straits.

As long as there are physical goods, this will be a very important strategic location to USA, China, Europe and Japan.

Indonesia has a population of over 200 million people. That is the real target of this SEZ. To be able to tap on the large population of workers. (I hope it doesn’t end in exploitation though.)

Imagine the Riau Islands re-emerging as an economic force. Will this happen? Can this happen?

I think so, if we can get this place going, I think it will be fantastic.

Imagining the Future

Imagine a company, financed and headquarted in Singapore with a manufacturing base in Batam. Product designers design them in Singapore, the product designs are then emailed over to Batam, manufacturing, assembly and takes place. Within the same day, the first run of this new product is produced and ready for shipping.

The products are loaded up at Batam’s port and sped across to Singapore’s port where large vessels take in the containers and continue to ship them to the rest of the world.

That’s truly Just-in-time manufacturing.

Taking Full Advantage of our FTAs.

By having a large manufacturing base just off our shores, we can finally capitalize on our FTAs.

Many of our FTAs require transhipment of goods through Singapore’s ports for them to be effective. So for example, for a Thai manufacturer to take advantage of US-Sg FTA, he’ll have to ship through Singapore. That is definitely less enticing than if it was manufactured in Batam.

Also, Singapore/Batam is actually very centrally located. A product manufactured here can actually reach Europe/Middle East faster than from China.

Bridges and Budget Airlines:

One thing that’s lacking is fast transportation into Batam. For this to really work, we should have a causeway or a bridge so that we can drive straight into Batam. That way, the flow of business will be higher. Of course that is really expensive.

The cheaper way would be to setup Budget Airline routes so that we can fly into Batam and Bintan. This is especially important for Bintan because it takes the same amount of time to get to Bintan by boat as it takes to fly to Bangkok!

Expanding Singapore

In a previous post on “Expanding Singapore“, I wrote something along these lines. I wrote:

Copy Singapore, Ride on Singapore Inc
Also, I sometimes wonder why the Malaysians and the Indonesians haven’t caught on to develop attractive sister cities in their properties surrounding Singapore?

If I was Indonesian, I’d setup a competing “Singapore” on Batam and Bintan and replicate, copy, steal whatever Singapore does. Sounds devious. But it could be quite a smart strategy to position itself as the “cheaper Singapore”. That way, we’ll be kept on our toes to continue innovating and moving toward knowledge based services.

…

Ultimately, I believe this would be complementary to all parties involved. To grow the immediate region would attract even more opportunities to Southeast Asia. Singapore would have its hinterland and Malaysia/Indonesia would strive hard to compete with all its national pride.

I’m glad that both Indonesia and Singapore has seen the benefits of concluding such an agreement. I applaud them for thinking ahead and concluding this so quickly.

Now, it’s time to execute and make this a successful proposition…

Editor’s Note: This article is reproduced from Justin’s blog with the same title. For more information on the usage of FTAs, you can also refer to the article “The ABCs of FTAs – Fundamentals of Free Trade Agreements that you should know” in the ACE website.

Some people ask, “Can YouTube Make Money?” How can it make money giving away everything for free? It has to sustain such high bandwidth costs. It’ll die soon. But maybe not, only in Silicon Valley…

Now, more likely than 1999, eyeballs as a metric is back. The difference is, how expensive was it to obtain the eyeballs?

Some people quote a bandwidth bill of US$1m a month. They say YouTube will struggle.

But, is it really that expensive? That’s my question back to you.

I feel that the $1m is relative.

Let’s put it this way. I see YouTube as a Global TV Channel. So, in order to compare if a $1m/mo is expensive, I’d compare it with websites of the top newsites in the world:

Click here to see the Alexaholic fightout between Youtube, CNN, MSNBC, FoxNews and USAToday.

Within hardly a year of its existence, YouTube has burst out of nowhere to beat CNN.com so much so that it’s daily pageviews according to Alexa is nearly 2x of CNN.com. That’s a classic J-Curve, the all powerful exponential at work here.

If you were to bring up the annual reports and examine the cost-structures of any of these mainstream media organizations, I’m sure the cost of maintaining, producing and marketing their websites would have cost much more than $1m a month.

That’s where I’m coming from in my analysis. Yes, you may say that I’m comparing apples to oranges but this is what I think is the closest comparison off the top of my head.

For me, YouTube is re-writing the rules in the entertainment delivery eco-system. It is a cost-effective startup with a global reach that was built in the shortest amount of time, without the attendent costs involved in building out distribution the way mainstream media has to.

In other words, unlike cable-tv companies which had to incur huge infrastructure investments to build out their networks, YouTube saved a ton of money on such startup expenses and went straight to delivering great content. YouTube leveraged the global IP network already in place, the great excess bandwidth after the telecom crash-out of 2001, cheap harddisks, cheap processors and cheap operating systems to catapult itself into a position with greater global influence that any other company has every built before.

So, given this, which would you rather invest in? Youtube or the next cable-tv company?

I remember how Tim Draper from DFJ once remarked, “If some items on your P&L or Balance Sheet can be zero, please come talk to me.”

For YouTube, Infrastructure Buildout Cost = $0, Marketing Cost =$0, Content Development Costs = $0.

That’s three strikes my friend!

What is YouTube really?