Tips for the Young Entrepreneur
Management guru Peter Drucker once said, "Entrepreneurism is an activity, not a personality trait. The essence of entrepreneurism is innovation, creating new satisfaction and new value for consumers." Utilizing resources and employing new modes of production to meet market demand is the engine of economic growth and, more importantly, the reason why entrepreneurship is respected.
It is generally held in academia that entrepreneurism can be encouraged through education, but is any given person actually cut out for starting up a business? What are the necessary makings of an entrepreneur? It would seem that education is not the only factor.
• Taking the boss's perspective
According to Rocky Yang, chairman of 104 Job Bank, "Entrepreneurship is a process of accumulation. An entrepreneurial mindset must be trained over a long period of time." Yang observes that most people start out working for someone else before looking for an opportunity to become the boss. He urges employees hoping to start up a business to excel at their current jobs, to look at things from the boss's perspective. The only way to develop one's entrepreneurial eye, says Yang, is to understand one's surroundings and acquire managerial skills.
• Stick to your knitting
"When you borrow money to start up a business, it's easy to go belly up," notes Stan Shih, founder of Acer, who points out that the chances of failure increase if you rely on short-term capital or charge into business without funds of your own.
Statistics from the National Youth Commission (NYC) and the Ministry of Economic Affairs' Small and Medium Enterprise Administration (SMEA) indicate that raising capital is indeed the biggest hurdle to starting a new business. A number of government agencies have offered business startup loans in recent years, including the Ministry of National Defense, Council of Indigenous Peoples, NYC, and SMEA. Standardized loan application forms are used, and procedures are simple, but applicants must put up at least 50% of investment capital themselves.
Running up credit cards or borrowing from loan sharks are the absolute worst ways to fund a new venture.
Another big no-no is to overestimate your abilities and start up a business in a field you know little about. Acer's first big crisis came when it invested in Acer Semiconductor, branching out from memory manufacturing into the wafer foundry business. The venture saddled Acer with losses of nearly NT$5 billion.
1970s-born Wu Tsung-en, chairman of Yannick pastries, heartily concurs about the importance of money and field-specific expertise: "The three principles for entrepreneurship are 'your own self, your own money, your own field.'"
• Who you know, not just what you know
The sales training manual for IBM Corporate Software states that even for high-tech products, human connections are still the key to successful sales. He Kun-chien, senior sales manager for IBM Taiwan, offers the following insight: "Do you know anyone in your clients' middle or senior management? These acquaintances are always more important than the products themselves or after-sales service."
Wen Chao-tung, director of the Graduate Institute of Technology and Innovation Management at National Chengchi University and founder of the Skylark restaurant chain, stresses the importance of having friends and contacts. He advises: "You've got to have a network of friends and acquaintances there to give you advice and connections. You've also got to be observant, to know what others want and get startup ideas. These are resources that an entrepreneur needs."
• Focus and persevere
Even now, four years after the burst of the dot-com bubble, large numbers are still drawn to dot-com ventures like moths to the flame, and most end up failing. Rocky Yang acknowledges that Internet usage has indeed risen steadily since the Internet was put to commercial use, but cautions, "The Internet is very nice, but it doesn't solve all your problems. You've got to avoid the temptation to join the dot-com stampede."
"In the decade since 104 Job Bank was founded, we've concentrated on one single task, which is to reduce mismatches in the job market, because by doing so we can reduce waste of resources," says Yang, who adds, "There are always jobs needing filled and people needing jobs, we've just applied the Internet to the hunt."
And finally, once you've lined up your resources and gone into business, you must be prepared to fight tooth and nail to stay in business no matter what. Hon Hai Precision Industry chairman Terry Gou has remarked that once you've plunked down your money, pouring every last drop of your life's blood into the business is still no guarantee of success. A lifetime is not long enough to make all the improvements needed in a company. To run a company, you have to be in it for the long haul.
(Vito Lee/tr. by David Mayer)
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