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Archive for the 'Startup' Category

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Bootstrapper’s Bible

Published on 28 August, 2005 in Entrepreneur, Readings and Startup. 0 Comments


The Bootstrapper’s Bible by Seth Godin

A quick, easy and inspiring read for anyone wishing to start a business without any money.

That’s said, I guess one still need to have sufficient to last those drought period where there is no income. Especially if you believe in the long haul.

Don’t give up. Surviving is succeeding. This is the main thrust of the book and it goes on to discuss ways of surviving. Indeed as many entrepreneurs (bootstrappers) had came to learn that many failures are giving up close to success.

An excellent book to check against your business ideas or model. Download from Amazon.

Presenting … SinoEthos

Published on 24 August, 2005 in China, Entrepreneur and Startup. 0 Comments

After some months of preparation and false start, me and my partner is finally launching SinoEthos Consulting.

SinoEthos focuses on leveraging our core strength of China and business knowledge to help companies start up, survive, strengthen and succeed in this fledging China environment.

My partner George had been in China for more than 10 years, holding position as financial controller and CFO in various private and government related companies. As for myself, my experiences are mainly in Internet startups and technology.

A right partner is important as I had learned over the years. It is then God’s blessing that we met, see eyes-to-eyes on our aspiration and the complementary of our skills. A prefect meeting of the old economy and new economy, of brick and motar and the virtual, just to borrow terms over-used in the dotcom era.

After some still-borns, false-starts and failed attempts over the past year, morale had wore thin. This launch had been a morale booster as well as setting a platform for growth.

Head over to SinoEthos where we constantly share information on business-related issues in China.

Business entity in China

Published on 10 July, 2005 in China and Startup. 0 Comments

It is well documented in various sources (like in Setting up business in China by IE Singapore) the different type of entities a foreign business can set up in China. However what is seldom documented is how to get it done - a step by step guide.

We all wish there is such a guide, but it is highly unlikely there will be an authoritative one. The main reason being there isn’t a single prescribed "standard" way to do it. When I say this I do not mean there are criteria to evaluate each company. I do mean there are many ways to get things done.

Having stayed in China for a while, you will soon find out that this is the case for most things. There may be a
prescribed way, but that’s not how things get done most of the
time.

Also unwritten is the cost of setting up such a foreign-owned/invested entity. It sufficient to say that it cost quite a bit. So how do a cash-strapped, small-time foreign entrepreneur set up business in China?

First, with sufficient money, this really isn’t an major issue. Just throw enough good money at the problem and it will be solve. Consultants are at your service ranging from 8,000RMB to 80,000RMB excluding necessary payables and capital. They will provide you with consultation and an end-to-end (一æÂ?¡é¾™) solution.

This route is strongly recommended not only because it saves time and effort but it may be the only way to get it done without hassle.

Second, if you do not have the money, DIY is still not recommended. For two simple reason. One, you can forget about understanding all the relevent regulations. Two, you do not want to deal with the authority directly, trust me. So hunt for a less expensive consultant who may not have a posh downtown office or speak excellent english but gets the job done nevertheless.

Now here’s what most people don’t mention, or at least not directly. Setting up a foreign-invested business entity is really not for an shoestring entrepreneur wannabe. Typically, there are minimum investment requirements for foreign-invested/owned business. These investment requirements are not astronomical but enough to stop many an entrepreneur on the track.

The way to go for the cash strapped is what is commonly termed "local partner". The point to note is if you come from countries where you can start legal business partnership, the term "partner" does not implies any legal relationship between you and the local person. "Partner" just refers to a personal relationship.

This is a potential minefield that one has to thread carefully. Also I am not recommend breaking laws. Other than the consequences, any plan to startup in China will be jeopardised. My position is that we respect the law in the country when we are in that country. There do exist however leeways that can get us to where we want to be.

The de-pegging of the Chinese Yuan against Dollars

Published on 14 May, 2005 in China, Investing and Startup. 0 Comments

The Chinese yuan exchange rate against Singapore dollars is something I monitor quite closely to me since I spent my Singapore dollars here in China.

Recently there is a heightened expectation that the Chinese will soon de-peg or at least loosen the peg of the Yuan to the US dollars. Many people know that the yuan is in reality stronger than what the current value suggests. So it is expected to raise once the peg is release.

Now, I’m now a big time investor nor do I have millions being transferred. But the implication is no less significant.

Buy Low, Sell High

Published on 11 May, 2005 in Quotes and Startup. 0 Comments

"Buy Low, Sell High, Collect Early and Pay Late" - D. Levin from his book with the same title.

Seemingly simple, utterly difficult to achieve for a small businesses.

Buy low - with no bargaining power, hardly anyone is willing to discount. Small businesses are mostly price takers.

Sell high - cut-throat competition drive price lower than ever. Forget about providing better service to command a premium. Service is a given, not a paid for. Brand? Got to build it first.

Collect early - probably the most workable among the four. Be daring to ask. Most of the time I found that customers at least pays on time. Be creative to structure payment schedule.

Pay late - to maintain good working relationship, there is a limit to how long payment can be dragged.

Chasing unpaid account

Published on 29 March, 2005 in Startup. 0 Comments

Cash flow is very important to a startup. One important determinant of cash flow is the collection of account receivables.

Going after unpaid account is a delicate balance between spending valuable time and resources going after it and spending the same time and resources on the business. Unpaid account is also a source of stress that can distract the focus on running the business.

With limited time and resources what can a small startup company do? Here I share my recent experience with a frustrating account and my options. This matter is still on-going and the discussion may not represent my final choice of action.

A common wisdom is "not all customers are profitable". This is indeed true and the starting point to avoid bad account is simply not to accept them in the first place. This can be tough decision for a small startup. Besides, there is usually nothing in the beginning to indicate if a client would default.

Once payment default occurs, the natural reaction is to feel frustrated and inclined to act on impluse. Restrain that and stay professional.
The issue can be further complicated if there are sub-contractor involved and their payment depends on the account being paid.

In my case I was the end developer, I also engaged the service of a freelancer to do part of the work. My immediate client was in turn engaged by another company to do the job.

I had been in tussle with my client for the past few months. In my search for ways to resolve this, these are some mode of resolutions available in Singapore.

  1. DisputeManager.com
    This is a service setup by Singapore Mediation Centre with the support of the Ministry of Law and the Singapore Academy of Law.
    Among the services provided,e-Settlement looks promising. The other services are too prohibting expensive for smaller dispute like non-payment.
  2. Small Claims Tribunals
    This is a traditional route and the cost is reasonable.
    Not exceeding $5,000
    		 Exceeding $5,000 but not exceeding $10,000
    		 Exceeding $10,000 but not exceeding $20,000
    Non-consumer
    		 $50.00
    		 $100.00
    		 3% of claim amount

    The website provides good information about how to lodge a claim.

  3. e@dr
    This looks similar to DisputeManager.com but covers "disputes which arise directly or indirectly out of e-commerce transactions. This includes disputes on the sale of goods and provision of services, as well as disputes on intellectual property rights and domain names."
    It looks promising for my case.

Thoughts on the resolution methods

  1. One drawback I can see in using this method is that the other party must agree to use it. (Refer to how it works.) What happen if they don’t agree? There is no way to compel them to comply. On top of the fees paid, the amount claimed is likely less due to the way it works.
  2. This is the traditional method and likely the most effective against client that refuse to yield. On the other hand it require time and energy to file the claim and attend hearing.
  3. e@dr is an interesting concept especially since it is targeted at ecommerce. This would definitely come in handly in future.

Although there are avenues for resolution, the best defence is still to avoid it in the first place. This begins with choosing the right client and so far my best client are referral clients.

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