Ep 68: 3 honest advice starting small business

And I’m not saying that they’re definitely wrong. They probably have some good tips and tricks within them, but figuring out a business is a much more complicated process. I decided that I should have you some tips, you know, as to what some of us do, some business people, some of us do. Yeah. I think I’m business people la hor. I say that also a bit paiseh [laughs] because I’m like a serial failed entrepreneur. I’ve tried many things and many things didn’t work, you know, but recently things are getting a bit better. 

Like with the podcast, you guys, more and more people are listening and we’re slowly systemizing it into kind of like a business, trying to find ways to, you know, monetize it and systemize it and make it into something more proper. And of course I work for other businesses, so yeah, over time I do have some experiences. And of course, after I talked to the eight people, I think, you know, I start to see some commonality as to how things work. So today I decided that I will share with you some good stuff.

But one caveat before we begin, I specifically said that, you know, it is about starting a business with small budget, because reality is if you are not bootstrapping, you have a certain budget, you are trying to invest in something, you’re buying over a business or you are, you know, raising some money to then grow your startup, high growth companies, those are very, very different and the way they do things are slightly different. I think there are sort of fundamentals that are shared across the board, but you know, it’s a different journey. It’s a different pace of growth. It’s a different kind of rigor. And yeah, we can talk about that at another time; I’ll probably bring a few friends of mine in the space to come on and talk about their journey. But, you know, for most of us that are just trying to, you know, start our own like Carousell store, our own Instagram store, or, you know, I don’t know, sell some stuff, small little, little things that we’re trying to do on a side, maybe writing a blog and monetize it or whatever, you know. I don’t know these days what kind of businesses do you guys want to start or people want to start, right. If you want to do small stuff, you know, do your own Hawker store, I mean, there are 101 ways to do things. And that’s why I believe that with people that are trying to do a small business with a small budget, there are certain commonalities and common basis. 

And I’m going to share with you some tips and checks and the very very first one is: focus on fulfilling a demand, okay. Don’t think about creating one. So creating a demand is something I feel only the bigger businesses do because they have big budgets. They are trying to innovate on new product. They’re trying to educate the public to do a whole new thing. And those things are very, very expensive, for lack of a better way to put it. Many people are trying to create the next big thing. But realistically, I think it is not that you cannot create the next big thing, but most of the people that create next big things, right, they are very deep in the space, right. I mean, they’re very deep in their field. They know their stuff and they have raised a lot of money. You know, they are trying to do something much, much bigger. Of course, I’m not saying you cannot enter these kinds of businesses, but if you choose to enter it, then there’s a very different discussion. But if you just want to kind of do a small business and just kind of make some side income, then I think you should focus on what your customers want. 

Go around and survey them, try to profile them, fulfill their need, find out what problems do they have and, you know, kind of work from there, right. Rather than thinking of this big black next big thing. Usually I call it developing in the dark. I always tell my team is like, “Hey, we don’t develop in the dark” because when you develop into dark, you’re not sure whether people want it. So it’s not very efficient. And you spend a lot of resources trying to do something that, you know, may not be the case. Which is very synonymous with creating a demand, or creating something whole new. All right. So. Unless you have some big ass vision and foresight, which is why I say most people that create next big thing, like huge as big things, they tend to be sector deep, you know? So if you’re not, you’re just trying to make some money, then focus on fulfilling a demand.

And how do you know that there’s a demand? You go and survey, talk to people, you know, you kind of already know who are your customers, right? Who are your immediate customers? And talk to them, right? If you are trying to sell a cookie to them and asked them, “Hey, what kind of cookies do you love?” Are there some references? What’s the price point they’re willing to pay? And focus on understanding the customers and profiling them. From there, you fulfill their needs. If you know that they have a certain problem and enough people tell you they have a certain problem, then okay, tada, you can solve it. 

If you start to, you know, if you start the other way around, which is like, okay, I have something and I want to sell it. And then you keep shoving down people’s throat and nobody’s biting it. Nobody wants it. Then you’re just going down a rabbit hole of shit show, right? The chances of you making a deal or senses of you like breaking through from that business is going to be really, really tough. It’s not impossible, but it’s going to be really tough, right? So let’s say you create this… okay. So one of the people that I interviewed, you will know her soon. So let’s say you create a bag. So her story is she, she created this bag. She built a prototype. And then it is a trolley thing. And then she brought around and she ask people, “Hey, is this why you want?” And then people are like, no, no, no, no, no. And in her head, I was like, you don’t understand la. You don’t understand, this is what you want. But actually the market just told her, she went on the survey on the street and the market told her that this is not what I want. Right. So she didn’t believe it. She took the prototype, went to China and, you know, waste all the money and whatnot, but she came back and then she redid the whole process and somehow this other product that she’s created, people wanted it. So when people wanted it, it is so much easier to do because you’re just fulfilling a demand. So go ahead and find out what do people want, find out their problems and solve it. Don’t try to create a whole new thing, and shove it down  people’s throat. Chances are, you know, you want to succeed right? Fulfill the demand. 

Which brings me to point number two. After you find out that there’s a demand in the space. You do all your survey. You go and talk to all these people. You profile your  clients, and then you find out that there’s a demand for a certain thing. Point number two is create a solution that you can, okay. Forget about scalability. Forget about scalability first . There is a lot of talk about scalability and it is true that if you want to grow your business to a much bigger size, much bigger scale, you need to look at how to scale the business, which essentially means how to grow the business a lot faster in a more systematic manner.

But reality is I think most people start with very not scalable kind of things. Nobody starts by thinking, by creating something that like super scalable, because when something is ready for scale then there must be a really a lot of people using this thing that you see the demand coming in organically, or, you know, you found a funnel, you found a certain way that can keep people coming in and it grows, grows, grows. And then from there, you double down and scale it. You pour kerosene. But you don’t pour kerosene on something that is like not flammable, right. So you want to make sure that the thing that you’re selling works, the solution that you’ve created, you know, has reached a point where it can keep repeating and repeating and repeating.

But before that, before that there’s a lot of tinkering, a lot of things that you are testing out, you want to proof the concept. You want to prove that, okay, now you found this potential demand. You want to fulfill it, you do what you can first. Okay so let me just give you an example. 

So today you love to eat cookies, right? And people around you, you know, in school, everybody loves cookies because — who doesn’t like cookies. But okay, if you don’t like cookies, it’s fine. But if you love cookies and you realize that, hey, you know, in school there isn’t really a place that sells very good cookies. What do you do? You don’t go and like immediately, you know, outsource this whole thing to somebody to produce it and like buy a vending machine to then dispense, you know, all this kind of stuff. What you probably will do is if you don’t know how to build a website, you can start an Instagram page. Start an Instagram page and then go back home and try to figure out what kind of cookies that people want based on the demand, based on the survey and the profiling of the customer you’ve done. Right? So go ask all your friends, you know, what do you want? What do you want? Everybody likes cookies. Okay. How much are you willing to pay? What’s your favorite flavor? You know, what’s the size that you enjoy, blah, blah, blah. You come back, you try to create a solution that you can, right. So if you don’t have a stand mixer at home, so what do you do? You take whatever bowl there is, pour the ingredient in, and then you mix mix, mix, mix, mix, and then you do it.

So if people like it, then you verified it. Okay, this solution that you’ve created, it’s not scalable. Okay. You cannot double, triple, quadruple, but people like it. Right. So then now if there’s more demand, what do you do? Okay. Potentially now you keep mixing, mixing very tired already, cannot, beh tahan. You buy a stand mixer. The stand mixer now helps you to mix all these different stuff. And you can like maybe produce 10 times more than when you use your hand, right. Or you buy a bigger oven. Now you can produce 10 times more than when you had your small little oven that you used to toast your morning bread. [laughs] So from there you realize that, okay, now, If business continues to grow and more and more people want it, people want different flavor, and you realize that, “oh my God, I’m taking up the whole kitchen. Even my mom cannot cook now.” What do you do? You probably need to go find some place to do the packing and produce elsewhere with a kitchen space or work on a consignment with someone else.

But the idea is not to give you the ultimate cookie dough recipe or cookie, you know, business recipe. But the idea is to let you vision and envision and realize that you can only do so much. And realistically, every step of the way, when you’re trying to grow your business, things are changing again and again, and again, and processes are just, they just keep changing the processes. Much like how, you know, I did this podcast when I first started it was just me, one person using some very jialat, you know, input to the phone kind of mic and it grew and grew you guys enjoy, you guys listen, and now I was like, okay, maybe I want to buy a better mic so that I can, you know, amp up on quality. So then what I do, I buy a better mic, I amp up the quality, but at that point of time I was still editing, so I couldn’t do a lot. And then after that, I was like, okay, if I want to do more of this and people are enjoying more and more people are coming on, what do I do? I need to outsource the production process, the production back end process.

So I got our sound engineer in residence, Harry, to kind of help us do all these kinds of things and do all the production process. Okay. Then I realize, okay, now more and more people enjoying the podcast and we want to talk about different various topics. I need to recruit people to talk about other topics. So I recruit all these people and then I need to create a system to teach them. So then I recorded a whole podcast startup kit, internally circulated amongst all the guys so that they can listen, okay, what to do, how to ask question, how to stage certain things. So you realize that at every step of the way, things are changing. Which is why I really think you can throw out the fascination about this one time good one, scalable, tested, proven system model kind of stuff, because to me, these things don’t work right from a recurring… from someone that has tried many, many times different, different kind of businesses, and all my friends, quite a few of them entrepreneurs, we all realize that, you know, it is a tinkering process. You do what you can first, and then over time, you know, you just keep changing and improving and change, change, change, change. And then when there’s more demand, you keep growing, change, change, change. Suddenly you scale up, suddenly things grow right, and you will, you will reach a tipping point and you will reach what we call a hockey stick.

You will then grow, grow, grow. And somehow it may take over your life and become a thing. You can quit your job and do your business. But it is not a buy a course, and then, you know, scalable immediately it works. Doesn’t, right. Focus on what you know, fulfill that demand. 

Which brings me to point number three, that is, do not work with your friends, okay. Work with people you can trust. What do I mean, what do I mean? Okay. A lot of people when they start their own business, the first thing they think of is find their friend, because they can trust their friend. But I’ve said this somewhere in one of the podcasts before, you know, when you trust your friend, you trust that your friend is a friend. That means when you’re not feeling well, you know, they can be there to support you, to cuddle with you, to school other people with you, to drink with you, or they can have fun with you. They will be there with you as a friend, but that doesn’t mean that they can do business together. Do they have the skill set? Do they have the hunger? Do they have the common vision and you know, what ethics… do they even suit you? Some people you can have fun with it, but you cannot work with them. And that is why I don’t believe in working with friends. 

I believe in working with people that I can trust and trust is very much based on reliability and repetitiveness. And what do I mean? I can trust someone to be an asshole, right, if they are constantly an asshole. Because repeat mah. They keep repeating at themselves and they’re very reliable that they are an asshole. So when I look for my business partner, I want to date them. I want to go through a process of getting to know them, you know, date them and you know, and dating does not mean pat toh pat toh, but like get to know them, drink coffee, and then like try small little projects together. 

Let’s say, you know, let’s say I want to do a podcast. Like, like we’re doing a podcast and. I want to get someone to be a business partner. I don’t immediately get them on. It was like, eh, okay, this person experience ah, same vision, blah, blah, blah, immediately. No, it doesn’t work that way. I take time to do small little projects, like, okay, let’s run some live videos, you know, let’s see how the work, how the work ethic is. Like, you know, how much initiative does this person have? Do we share the same vision? Do we share the same moral values and all those kind of stuff? So take time to date these people. 

And over time you find that a lot of people that work together didn’t start as friends. And it is perfectly fine, but it just so happened that your friend is also very entrepreneurial and you trust them, and you think that you guys can do it together, okay, then so be it, do it together. It is not that you cannot work with your friends, but I tend not to. You know, I tend not to price that friend factor very high. I want to price, you know, the kind of reliability and trust factor higher. And sometimes, you know, like I said, you can trust your friend to be a friend, but it does not mean that your friend can be a business partner. And I hope that makes sense for you. 

One personal tip is really do not take your business partner lightly. Do not take choosing a business partner very lightly in the sense that I realize a lot of people do this. Like they take a lot of effort to try to hire the first person, but they can randomly jio their colleague or jio their friend, like eh, let’s do a business together. You know, to me that is like… your first step to failure is you randomly jio your colleague or you jio your drinking friends, or you jio whatever, you know, random person out there to do it together. Right. Chances are, you know, things may not work la. So when, when I look at it, there are some people that make it this way. That’s normally, but statistically, I think you want to work with people that are entrepreneurial, people that have the same vision and same moral values and have a certain level of skill set that they can provide you with, you know, as we go along. But of course, if you cannot find these people, then you see if you can do alone. You start alone. It is perfectly okay. So  my personal experience is when you have too many people to start together, two or three people, or four or five people is the worst. Two or three… let’s, let’s start with two or three.

If you take more than three people to start a project then don’t do this project already, okay. Let’s say you do three co-founders and everybody start this thing together. What will happen is you’ll spend a lot of time talking about things that, you know, ain’t no matter, right? Because there’s nothing in front, everybody’s trying to input their ideas, input their beliefs, input their whatever, whatever into this empty thing. And it’s very tough, but if you can take whatever you can do, you found out there’s a demand. You’re trying to fulfill. You create whatever solution you can create, as simple as possible that you can and you take it and run first. Over time, this thing starts to become something. And, and there is like, you know, like I do this podcast after a while, you know? Okay, it forms a shape, you know, people are listening. There’s a certain thing going on. Now it’s a lot easier to welcome business partners. It’s a lot easier to bring co-founders on because they already see something. They know generally where you’re trying to go towards and then they will only join you if they believe in it.

So it’s much easier… rather than start with random people. So if you want to start something with people, you make sure that you can trust them on a work and business basis, not just about friends, and if you cannot find, don’t desperately randomly find anybody. Try to do it on your own. And once the picture starts to come out a little bit, it’s a lot easier for people to chime in on the picture. It’s very difficult when three people start on an empty sheet of paper, Personal experience, okay. 

So I’m going to sum up today. Three points to starting a small business with small budget. Okay. Number one is focused on fulfilling on demand. Don’t try too hard to create one. Go out and survey, find out, you know, what do people have? What kind of problems and what kind of demands do they have and try to fulfill that. Two is create a solution that you can. Forget about scalability. Don’t think about scaling because scaling is an ongoing process. It takes time to keep changing, changing, changing. It gets there, work on what you can first and fulfill that demand. And then we work from there. Number three is, do not work with your friends. Work with people you can trust, right? And trust comes from reliability, comes from repetitiveness and you know, you want to find out the person, date the person, get to know them. What are their experience? What can they bring to today? What can they bring to the table? And worse come to worst, do it on your own, take it and run. Down the road, things may happen. So I hope you learned something today — see ya!

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Test test. Okay, I hope you learned something useful, some very honest, realistic business advice for when you don’t have a lot of budget and if you have some interesting ideas, you want to talk about it, come to Telegram group and ask people, you know, come and ask, “Hey, do you need this? Do you need that?” It is fine.

Come and do your experiment and ask the people around. So I am pretty entrepreneurial. For a period of time, I didn’t really support people being entrepreneurs because I thought it was like, it’s like very painful, but after a while, I feel like hey, you know, if you really want to be an entrepreneur and you want to test things out then just do it first.

I know people will say a lot of things. Some people don’t understand and it is okay, but if you feel that it’s worth doing it then do it, you know. But don’t do it blindly, right. Go and ask people, go and connect with people and be more on the ball, be more on the go and just kind of interact with people and, and just kind of see if things can work from there. Don’t develop in the dark. That’s my biggest concern for most people at that’s trying to be entrepreneurial. So I hope you learned something useful and any more questions come over to the TFC community Telegram group. 

And next week, next week, we have a very interesting friend of mine on the show, which is Kyith from Investment Moats. He runs a very popular financial blog in Singapore — one of the biggest ones. And I got him to come on to talk a little bit more about, you know, do you need to invest to retire? Because I think he transcends a little bit of… Like he worked for a period of time, you know, in the IT field, and then he invests on the side. And he talks a lot about investment in his blog already. So I didn’t really get him to talk a lot, a lot more about his investment because he published his whole portfolio on his blog, investmentmoats.com.

What more, what more you want from him? So he writes a lot about it. And we did talk a little bit about investing for sure, but I think it’s really more about creating a life you love. And I thought it was an interesting chat because he did write a lot about non-investment related content, although he’s famous for being a investor. So we’ll have him next week and I hope you learn something useful from him. Any questions — you’re welcome to the Telegram group. See you guys. Bye-bye.