Thanks to Andrew Collins for inviting me to this exciting event.
The Entrepreneurs' Organization (EO) - for entrepreneurs only - is a dynamic, global network of more than 8,000 business owners in 40 countries. Founded in 1987 by a group of young entrepreneurs, EO is the catalyst that enables entrepreneurs to learn and grow from each other, leading to greater business success and an enriched personal life.
Membership in the Entrepreneurs' Organization is by invitation only.
To qualify, you must:
Full house in the beautiful Shanghai Hilton conference room:
Founder & CEO, Hurun Report (http://www.hurun.net)
Only 25 of the 2500+ people on the China Rich list have actually been jailed.
GM APAC, PopCap
- Hire slow, fire fast
- Play to employee’s strengths
o Performance reviews really don’t do anything; put the people in the right role, or fire them
- CEO – do the right thing, do the things only the CEO can do
- Hire a great assistant
- “feed the dragon” – from publishing world, the “dragon” is the editor, always have something ready to give to the editor when he/she comes asking; instead of spending 100% of the time building the perfect product, spend 10% creating marketing material to promote your product when the dragon comes
- Build a great product, not just a great company; don’t worry about all the stuff of a big company like 401k, onboarding, etc, before you’ve built your product
- Pay yourself first – fire the weakest employees instead of starving the best (which the founder should be one!)
- Hire a pessimist, and listen to him/her; founders are optimists by definition; have a “in case of fire, break glass” plan
- Fail fast; VC’s hate “zombie companies” – a company that’s not failing but not succeeding either, just wasting time
- Be open, even (especially) if bad news – tell all to employees, gain loyalty, pay back in future
- Inspiring Genius
- Getting Things Done
- Built to Last
Author, China’s Economic Supertrends
Global Strategy, WPP
What I look for in an entrepreneur
- Curious (picture above, girl looking at a polar bear)
- Accessibility – always accept a meeting, even if for only 5 minutes
- Financial acumen – treat every penny as if it’s your own, doesn’t mean don’t spend/invest
- Sell, sell, sell! Ask if being too pushy, ask for feedback – people will tell you
- Fame – entrepreneur must be famous
Best quote from WPP founder Sir Martin Sorrell: “WPP is not just a matter of life & death. It’s much more important than that.” (rephrasing from Liverpool football coach)
PayPal China GM
Blood from Stone – Justin has shown all the entrepreneurial opportunities in China, but how do you make a profit?? Find your competitive advantage – for PayPal, it’s cross border. Then add value to that strength – 300 direct sales in China, “OSS” (one stop solution). See Ruslan’s speech for same 2 points.
Highlighted 2 key ideas for internet
- Network model – each node increases the value of the network, this value grows exponentially, not linearly
o Example eBay: the more buyers there are on the network, the more sellers want to sell there, and vice versa; only a few successful examples that got past the chicken and egg problem: PayPal, Skype, Youtube, Facebook, Tencent. These are the most valuable internet properties. It really takes advantage of the inherent power of the internet for scalability.
o Be sure not to confuse network with “economies of scale”. Amazon in its pure form is an “economy of scale” business – where each additional consumer (“node”) allows AMZN to buy its products at a cheaper price. The reviews from users are an example of AMZN adding network value
- Viral – where users on their own push other users to sign up, use the service, for their own benefit, not for yours (the company)
o Youtube – when users post a video, they want all their friends to see it
o Facebook, LinkedIn – upload your entire contact database; originally could recommend / forward a game to your entire contacts on FB (now it’s limited # per day); that’s why the original FB games took off, building companies like Zynga
o Best case, you didn’t even know you were recommending: Geni.com send out an email on your behalf, using your email, to recruit your family members to add to the family tree. I added my sister, she got a “personal” email from me to add a few more (though it wasn’t even my writing style), she adds 10 more (she’s much more diligent than I am). Now, there are 447 people in our tree when I personally only added maybe 15.
Founder, Blue Frog and Kabb restaurants
50k bottles of wine a year consumed in his restaurants!
Values become really important at ~150 people:
- Creating a great customer experience
- Building community
- Working smart
Must have SOPs (Standard Operating Procedures)
Dad a famous artist, mom a top ballerina, cultural revolution, immigrants to the US with only $500 in pocket, dad gives him “the talk”
Do the “Hard work”…not just work hard. Like James’ comment, do what the CEO must do, the really “hard” work like promoting the business, raising money
Interesting stat: #1 attribute correlated to success of startups – tenacity (“be committed”)
MD, Splatter & Split Works
Founder, Kogan (http://www.kogan.com/au/)
Thanks for accepting PayPal!!
- Always go for win-win
o In college, the carpark in front of the classroom was huge but packed so if he showed up 5 minutes before class, he would drive around, couldn’t find a space, skip class and go back to his dorm. But he came up with a win-win idea. He would drive to the front door of the classroom, wait for the class to come out, offer a student a ride to his/her car, then take that spot, and be able to go to class. Brilliant!
- Amazing story of his first website sale of 80 LCD TVs on his own website that he built in 4 days and on eBay.
o 2 key pieces of advice:
§ Know your Competitive advantage
§ Offer value add to consumer
o Australian retailers were selling LCD TVs for $3000, he remembered they sold for around $1k in US; sends email to factories in China for a 100,000 order, gets a price around $1k
o Has no money
§ Learns from a furniture shopping trip with his mom, pay now, get furniture in 45 days
§ Offers LCDs for $1200 but ship in 45 days, enough time to get TVs made in China and shipped to AU; AU customers start buying because the price difference is so great
o Goes back to the factory to order 80 instead of 100k. Factory says they can’t just manufacture 80, not for any price. Now he has no inventory but he has already made sales.
§ For 4 days, he cleans up the “Chinglish” marketing material for the Factory and emails it back to them, for free.
§ A few hours after he sends the email, the factory tells him that they have accepted his order.
§ A few days later, the factory calls to say that they just made a huge sale to a US customer. The US customer explained that they chose the factory because they had the most professional marketing material in all of China.
o eBay freezes his account because he is selling so many TVs but has no feedback; money frozen in PayPal
§ signs up for 60 credit cards, asks friends to sign up for CCs too, automated form fill on Firefox, could sign up for a card in 60 sec
§ with all his new credit cards, he pays his 30% down payment to China factory
§ can prove to eBay that he will get the goods and account is unfrozen
o flies to China and personally tests each TV to make sure it works; watches the TVs get packed into a container; gets into a cab and follows the shipment to the ship
o First delivery goes well, makes some profit, reinvests for next delivery, cutting time down to 30 days; next time down to 20 days, etc; continuous improvement
o Now Kogan is a $150m business!
- If seller says “Mr Kogan, I can’t go any lower, I’m already selling below cost”, he walks out. Either the supplier is a liar or stupid. Stupid because he will go out of business if he takes orders like this. Or he’s a liar, whom Ruslan doesn’t want to work with.
- In interviews, tell candidates no training at Kogan’s. “There’s nothing you can’t learn on your own on Google”. Be responsible for your own actions, your own training, your own mistakes.
- There was an IT bug on the site that mispriced a product. Within 15 minutes, before they could take down the listing, they had lost $50k. Could’ve hidden behind the terms & conditions, but Kogan honored the sales. Turned a $50k loss into a multi-million dollar lesson, used to fix all the problems in the system / process so it wouldn’t happen again.
- Entrepreneur = inventor + athlete
Co-founder of Match.com, VC at GSR
What he looks for in an entrepreneur
- Commitment – have you quit your job?
- People who have failed, faced adversity = mental toughness
- Humility; the “inner art of humility” – really the ability to listen; do they dismiss ideas before listening? Failure is often caused by lack of humility, inability to hear from customers, employees
- Of course, other factors also needed: integrity, hardwork, diligence
- Are you starting a company that suits your personality? Plays to your strengths?
- Startup = journey of ups & downs; can you handle the downs?
MD, NFL China
Entrepreneur must have the ability to see change in 3 areas:
a. NFL a very complex product, one of the most complex sports – can learn for a lifetime
a. Wouldn’t have taken the job 5 years ago, but the internet changed the landscape – can watch Monday night football on Tue morning on iPad in China
a. Would NFL owners rather sell 1 jersey to every fan in China (quick buck now) or give every kid a football (grow the community)
Look for ways to prove yourself wrong. (James’ fail quickly)
Sports & media highest risk because emotions cloud judgment
Best and brightest go to the internet instead of media in China because they want to get rich; media controlled by state
President, EO Shanghai
You get what you give. EO has given back in many unexpected ways, not just helping work.
One piece of advice that he still uses: write down 2-3 good things that he’s grateful about every morning