Why start-up fail ?

Reason 1: Market Problems

A major reason why companies fail, is that they run into the problem of their being little or no market for the product that they have built. Here are some common symptoms:

    There is not a compelling enough value proposition, or compelling event, to cause the buyer to actually commit to purchasing. Good sales reps will tell you that to get an order in today’s tough conditions, you have to find buyers that have their “hair on fire”, or are “in extreme pain”.   You also hear people talking about whether a product is a Vitamin (nice to have), or an Aspirin (must have).
    The market timing is wrong. You could be ahead of your market by a few years, and they are not ready for your particular solution at this stage. For example when EqualLogic first launched their product, iSCSI was still very early, and it needed the arrival of VMWare which required a storage area network to do VMotion to really kick their market into gear. Fortunately they had the funding to last through the early years.
    The market size of people that have pain, and have funds is simply not large enough


Reason 2: Business Model Failure
As outlined in the introduction to Business Models section, after spending time with hundreds of start ups, I realized that one of the most common causes of failure in the start up world is that entrepreneurs are too optimistic about how easy it will be to acquire customers. They assume that because they will build an interesting web site, product, or service, that customers will beat a path to their door. That may happen with the first few customers, but after that, it rapidly becomes an expensive task to attract and win customers, and in many cases the cost of acquiring the customer (CAC) is actually higher than the lifetime value of that customer (LTV).

The observation that you have to be able to acquire your customers for less money than they will generate in value of the lifetime of your relationship with them is stunningly obvious. Yet despite that, I see the vast majority of entrepreneurs failing to pay adequate attention to figuring out a realistic cost of customer acquisition. A very large number of the business plans that I see as a venture capitalist have no thought given to this critical number, and as I work through the topic with the entrepreneur, they often begin to realize that their business model may not work because CAC will be greater than LTV.

The Essence of a Business Model
As outlined in the Business Models introduction, a simple way to focus on what matters in your business model is look at these two questions:

1.     Can you find a scalable way to acquire customers
2.     Can you then monetize those customers at a significantly higher level than your cost of acquisition

Thinking about things in such simple terms can be very helpful. I have also developed two “rules” around the business model, which are less hard and fast “rules, but more guidelines. These are outlined below:
The CAC / LTV “Rule”

The rule is extremely simple:

    CAC must be less than LTV

    CAC = Cost of Acquiring a Customer
    LTV = Lifetime Value of a Customer

To compute CAC, you should take the entire cost of your sales and marketing functions, (including salaries, marketing programs, lead generation, travel, etc.) and divide it by the number of customers that you closed during that period of time. So for example, if your total sales and marketing spend in Q1 was $1m, and you closed 1000 customers, then your average cost to acquire a customer (CAC) is $1,000.

To compute LTV, you will want to look at the gross margin associated with the customer (net of all installation, support, and operational expenses) over their lifetime. For businesses with one time fees, this is pretty simple. For businesses that have recurring subscription revenue, this is computed by taking the monthly recurring revenue, and dividing that by the monthly churn rate.


Because most businesses have a series of other functions such as G&A, and Product Development that are additional expenses beyond sales and marketing, and delivering the product, for a profitable business, you will want CAC to be less than LTV by some significant multiple. For SaaS businesses, it seems that to break even, that multiple is around three, and that to be really profitable and generate the cash needed to grow, the number may need to be closer to five. But here I am interested in getting feedback from the community on their experiences to test these numbers.
The Capital Efficiency “Rule”

If you would like to have a capital efficient business, I believe it is also important to recover the cost of acquiring your customers in under 12 months. Wireless carriers and banks break this rule, but they have the luxury of access to cheap capital. So stated simply, the “rule” is:

    Recover CAC in less than 12 months


Reason 3: Poor Management Team

An incredibly common problem that causes startups to fail is a weak management team. A good management team will be smart enough to avoid Reasons 2, 4, and 5.  Weak management teams make mistakes in multiple areas:

    They are often weak on strategy, building a product that no-one wants to buy as they failed to do enough work to validate the ideas before and during development. This can carry through to poorly thought through go-to-market strategies.
    They are usually poor at execution, which leads to issues with the product not getting built correctly or on time, and the go-to market execution will be poorly implemented.
    They will build weak teams below them. There is the well proven saying: A players hire A players, and B players only get to hire C players (because B players don’t want to work for other B players). So the rest of the company will end up as weak, and poor execution will be rampant.
    etc.

Reason 4: Running out of Cash

A second major reason that startups fail is because they ran out of cash. A key job of the CEO is to understand how much cash is left and whether that will carry the company to a milestone that can lead to a successful financing, or to cash flow positive.
Milestones for Raising Cash

The valuations of a start up don’t change in a linear fashion over time. Simply because it was twelve months since you raised your Series A round, does not mean that you are now worth more money. To reach an increase in valuation, a company must achieve certain key milestones. For a software company, these might look something like the following (these are not hard and fast rules):

•     Progress from Seed round valuation: goal is to remove some major element of risk. That could be hiring a key team member, proving that some technical obstacle can be overcome, or building a prototype and getting some customer reaction.

•     Product in Beta test, and have customer validation. Note that if the product is finished, but there is not yet any customer validation, valuation will not likely increase much. The customer validation part is far more important.

•     Product is shipping, and some early customers have paid for it, and are using it in production, and reporting positive feedback.

•     Product/Market fit issues that are normal with a first release (some features are missing that prove to be required in most sales situations, etc.) have been mostly eliminated. There are early indications of the business starting to ramp.

•     Business model is proven. It is now known how to acquire customers, and it has been proven that this process can be scaled. The cost of acquiring customers is acceptably low, and it is clear that the business can be profitable, as monetization from each customer exceeds this cost.

•     Business has scaled well, but needs additional funding to further accelerate expansion. This capital might be to expand internationally, or to accelerate expansion in a land grab market situation, or could be to fund working capital needs as the business grows.

What goes wrong
What frequently goes wrong, and leads to a company running out of cash, and unable to raise more, is that management failed to achieve the next milestone before cash ran out. Many times it is still possible to raise cash, but the valuation will be significantly lower.
When to hit Accelerator Pedal

One of a CEO’s most important jobs is knowing how to regulate the accelerator pedal. In the early stages of a business, while the product is being developed, and the business model refined, the pedal needs to be set very lightly to conserve cash. There is no point hiring lots of sales and marketing people if the company is still in the process of  finishing the product to the point where it really meets the market need. This is a really common mistake, and will just result in a fast burn, and lots of frustration.

However, on the flip side of this coin, there comes a time when it finally becomes apparent that the business model has been proven, and that is the time when the accelerator pedal should be pressed down hard. As hard as the capital resources available to the company permit. By “business model has been proven”, I mean that the data is available that conclusively shows the cost to acquire a customer, (and that this cost can be maintained as you scale), and that you are able to monetize those customers at a rate which is significantly higher than CAC (as a rough starting point, three times higher). And that CAC can be recovered in under 12 months.

For first time CEOs, knowing how to react when they reach this point can be tough. Up until now they have maniacally guarded every penny of the company’s cash, and held back spending. Suddenly they need to throw a switch, and start investing aggressively ahead of revenue. This may involve hiring multiple sales people per month, or spending considerable sums on SEM. That switch can be very counter intuitive.



Reason 5: Product Problems

Another reason that companies fail is because they fail to develop a product that meets the market need. This can either be due to simple execution. Or it can be a far more strategic problem, which is a failure to achieve Product/Market fit.

Most of the time the first product that a start up brings to market won’t meet the market need. In the best cases, it will take a few revisions to get the product/market fit right. In the worst cases, the product will be way off base, and a complete re-think is required. If this happens it is a clear indication of a team that didn’t do the work to get out and validate their ideas with customers before, and during, development.

Why scaling up is tough

Scaling up, or taking a start-up to the next level, is one of the biggest challenges for entrepreneurs. The first hurdle that can hold them back is complacency. When they begin, many entrepreneurs have fire in their bellies that drives them to innovate, aspire and take risks, but as they reach a certain level of success, this fire often dies out. The business fails to move to the next level. It is, therefore, essential for them to rekindle the fire if they want to rise further.


A number of start-ups are also unable to make the transition because of differences between partners who initiated them. Partners are usually people with much in common, who developed strong bonds while at a campus together, or at an earlier workplace where they were employees. Yet, once the business reaches a certain level, there is often a diversion of goals.


One partner may want to sell the business and keep the cash, another may want to remain at the same level, while a third may want to grow. It is essential for partners in a start-up to have congruity of purpose. Another bottleneck is absence of delegation. When a company starts, the entrepreneur behind it often performs multiple roles, from chairman to caretaker. He takes a wide range of decisions from technical ones to marketing, from production to administration. His team too depends on the entrepreneur for every kind of decision. At a later stage, this hampers growth. The entrepreneur soon finds his knowledge inadequate to tackle challenges, or faces time management problems, which hold back the company.


To achieve genuine delegation of responsibility, a second rung of leadership has to be created and empowered. Till this is done, businesses cannot scale up. Entrepreneurs often feel that by delegating they are giving up control. In reality, they are helping the business to bloom.



There are three more challenges. When a small number of people are involved, as is usually the case with start-ups, they all share the same vision, beliefs and goals. But once a company starts growing, a proper system needs to be worked out so that everyone working for it remains on the same page. Defining a clear vision and mission becomes very important, but this is often not done.


There is also the pitfall of execution. In entrepreneurial companies, much work gets done without being formally recorded. Inherently, a small group shares more information and has greater clarity about the company's plans than the rest. But as the company grows, such informality has to be replaced by processes, technology and internal communication.


Resources - both money and people - present their own challenges. Entrepreneurs often bootstrap their companies and use the same philosophy for scaling up. This needs to change. Execution plans must be adequately funded for people to execute and deliver as expected. The key to scaling up is to scale up the organization's capabilities. Once this is done, the scaling up in terms of performance, revenue and profitability will automatically follow.

Common Challenges Entrepreneurs Face and How to Prepare For Them

The road to entrepreneurial success can be a long and daunting one. In this article I’m going to share with you four challenges you’re likely to face so that you can be prepared for them, and can even embrace them, if they show their heads during your journey.


Challenge: Down in the Doldrums

According to several studies, entrepreneurs are more prone to depression and anxiety than the average company employee

Rob Emrich in response to a Brad Feld blog post wrote: “I think there is correlation between the type of people who become entrepreneurs and those prone to depression. I also think most entrepreneurs know that the daily ups and downs and constant uncertainty can easily cause and reinforce a tendency toward depression.”

When you ask most seasoned entrepreneurs how to deal with this the response is almost always the same, “make sure you surround yourself with supportive people that will be there for you and can help you get to where you want to go.”


Challenge: Overestimating

Another challenge entrepreneurs face is overestimating their initial success. You might read an article about another entrepreneur and believe that just because they sold their company in 1 year and made millions that you can do the same. When I first started FreshGigs.ca I overestimated what our sales would be in the initial months. Only after I spoke with a mentor at that had worked in the same industry did I get a realistic view of how to think about our sales growth.


Challenge: Focus

One of the biggest mistakes entrepreneurs make in their early days is trying to be all things to all people. They attempt to sell their product or service to too wide of a market. When you’re building your business, especially early on, it’s important that your marketing is grounded in a strong foundation with a clear focus on who your ideal clients are; and that you establish and work towards dominating that marketplace before moving on to others.

Entrepreneurs also face another challenge in this area. They focus on the wrong things. They spend too much time building their product without validating that the marketplace wants, needs and will actually pay for it.


Challenge: Passion and Purpose

Many entrepreneurs choose an oxymoronic approach to business. They decide to start their own company because they want unlimited income potential, to be their own boss and holder of their own destiny. Yet as they work on building their business they realize they lack passion for what they’re doing. If you’re going to be spending 10+ hours a day building your business, writing articles, doing research, and attending trade shows in the industry you’ve chosen, you’d be well served to ensure it’s one that you’re passionate about.


If you don’t enjoy the work you’re doing you’ll find it hard to get up off the ground the first time you get knocked down. And all entrepreneurs get knocked down at one time or another. The more passion and purpose you have for your business, the more motivated and energized you’ll be to work on it.


I can’t think of one entrepreneur that has been immune to these challenges. Know that you know to expect them you’ll be ready to deal with them and well positioned to stay on track and keep growing your business.

Lifeclycle of an entrepreneurial company

Do you ever wonder what makes a growing technology company succeed? You may have the best game on the market, but without an entrepreneurial culture, your company may lose its uniqueness and at worst, may go out of business.That's why so many tech start-ups don't make it to their 10-year anniversary. Legendary Apple CEO Steve Jobs had an entrepreneurial spirit, but it took him leaving and then returning to Apple to regain it.

Life cycle of an Entrepreneurial Company

Birth. Many companies begin their lifespan with a strong entrepreneurial culture. The organization is led by the vision and values of the initial team members involved in organizing the company.

Adolescence. This is a critical phase where new directions and processes are typically introduced. Rules and boundaries are established throughout the company based on the leaders' trial-and-error experiences. As the organization grows, expert leaders are brought in to assist in the company's growth - experts who may not have the same vision and values of the company founders. During this phase, the company culture becomes more corporate and mature.

Adulthood. Experts are pushed into leadership roles without the necessary training and development to motivate and inspire through the company's vision. Outside leaders are recruited who may not understand the industry or the existing culture. New leaders begin establishing standardization throughout the organization using cumbersome forms and templates or unnecessary policies and procedures. Ineffective leaders are unaware that too much standardization and micromanagement can chase away the entrepreneurial spirit.

How to Develop an Effective Leader

• Effective leaders are the key to maintaining a culture driven by the entrepreneurial spirit. It can be challenging to develop effective leaders that embrace the vision of the company, so how can you cultivate your functional experts to become more effective leaders?

• Establish Clear Vision and Expectations. The vision of your company is the cornerstone for all other goals, policies, strategies, and actions. The vision should be clear enough so that it can be easily woven through all other company goals.

• Teach Leaders to Create the Vision. Coaching your leaders to uphold your company's vision is the most effective way to keep the entrepreneurial spirit alive. It's more than just teaching the vision -- the words have to align with the behavior and culture. An effective leader will be relentless when it comes to ensuring that the vision pervades all aspects of the company's culture and behavior.

Entrepreneurship and Entrepreneurial Culture

 Entrepreneurial culture can be made to enable democratization of the capacity to create and manage (business) towards wealth creation, thereby eradicating poverty.

When people are empowered to create and manage their own businesses,

•     wealth creation is possible;
•     jobs are created;
•     individual and collective well being becomes a reality; and
•     it becomes easier for the State to better redistribute wealth to those who cannot work (disabilities for instance) when all those who can work are empowered to do so.

Earlier definitions of entrepreneurship have referred to creation and running of innovative businesses by people sharing a number of characteristics. Broadly speaking, entrepreneurship also includes innovative positive social interventions (to be dealt with under Social Entrepreneurship in a later Unit).

Culture refers to attitudes and values which in the case of entrepreneurship may be linked with autonomy, creativity and sense of responsibility (soft skills) and so on. It also refers to entrepreneurial knowledge and skills and management competencies which have to be acquired (hard skills).

The hard aspects of culture apply to entrepreneurship because without them, an entrepreneurial culture would not develop into a tangible act.

According to David Mc Clelland (1961), an entrepreneur is a dynamic person who takes calculated risks. This definition has a behaviorist orientation.

Fillion (1990) defines the entrepreneur as someone who imagines, develops and realizes a vision. In economic terms, one may define an entrepreneur as someone who combines resources in such a way as to add value.

A psychologist’s point of view may be that: an entrepreneur is someone who feels the need to accomplish something, to realize his/her potential or to become his own boss.

Across all above definitions, there is a recurrence of underlying notions like: vision, value creation, innovation, risk-taking and self-accomplishment.

Having reviewed the characteristics of entrepreneurs, one is tempted to conclude that an entrepreneur is a product of his/her particular environment. Several authors have shown that entrepreneurs reflect the characteristics of the time and place where they have evolved (Toulouse, 1990). The cultures, the needs and the habits of a particular country or region shape the behaviour of entrepreneurs. Obviously enough, with the falling of frontiers (both geographical and psychological) entrepreneurs exert an influence that goes far beyond their own countries and/or regions.


Entrepreneurial Culture

Culture can be defined as the mix of norms, values and beliefs that are shared by a particular community [be it a business community, a cultural (or ethnic) community, a country, or a geographical region].


Cultural Values

Linton (1975) describes values as a predisposition to act in a certain way.

Values of entrepreneurs:
According to Sexton & Bowman (1986), entrepreneurship is a value in itself for Americans. Different authors suggest different values for entrepreneurs:

Kets de Vries (1984): reputation, power, status and recognition
Gordon Survey of values (1976): independence, efficacy and a negative reaction to affiliation.

There is a general presumption that a society may have potential entrepreneurs, but only becomes entrepreneurial if it has a culture that supports innovation and initiative.

Cultural Attitudes

According to J. M. Toulouse (1990), entrepreneurial culture is favoured by the following set of attitudes:
1. Business activities are valued.
2. Individual and collective initiatives are highly rated.
3. Determination and perseverance are desirable qualities.
4. An equilibrium between security and risk is accepted.
5. The tension between stability and change is resolved.

Therefore, in a society favoring entrepreneurship, entrepreneurs are role models who are not only acceptable, but desirable.

Learning Activity 1

In such societies, challenges are regarded as opportunities (and not threats). In societies where entrepreneurship is absent, business challenges are left to be taken care of by foreign investors. On the other hand, within entrepreneurial cultures, people will find inspiration in challenges. These will enable them to act and find ways to exploit existing opportunities. An example of lack of entrepreneurial culture in a given country is where the business community believes that government is going to take charge of all their problems.

An entrepreneurial culture is supported by people who have a strong belief in their projects, who will invest their physical, psychological and other resources (also including those of others!) in their venture with a view to succeed.

Decision is taken out of reasonable certainty and out of a positive balance of probabilities based on available information. A community favoring experimentation, R & D and innovation, has a culture associated with risk taking. Entrepreneurship reconciles risk and security.

Starting a small business entails risks, but is also a source of gratification for the successful entrepreneurs.

Entrepreneurship has the potential to bring positive changes, both to the individual or collective entrepreneur and to society as a whole. Entrepreneurs are change agents who can alter a given situation and give society a product or service that can transform their behaviors and ways of living.

Hence, a society that favors status-quo and offers resistance to change does not display a culture conducive to entrepreneurship.

Similarly, a business organization that resists change will ultimately have to face its own obsolescence.

According to Fortin (2003), entrepreneurial culture can be rooted in a society through four main avenues:
- the family;
- education;
- existing business organization; and
- local and national authorities and leaders.

Promoting an Entrepreneurial Culture within the Community

The conditions required for establishing an Entrepreneurial Culture are:

Identification and promotion of Role Models: Women entrepreneurs, for example the ladies who lost their jobs in the textile sector and created ‘Charmin Sud’, a rural women entrepreneur partnership. They came on television to explain how being laid off from an ailing textile industry was for them a blessing in disguise. It allowed them to unveil their entrepreneurial potential and leadership abilities.

Role of media: For instance, in the promotion of Entrepreneurship as a business model. Until recently, the local TV ran a weekly documentary: ‘Portrait d’Elle’, in which a local women entrepreneur was portrayed as to her new place in society as an economic (and social) agent. Similarly, a few newspapers reserve a page regularly to promote entrepreneurial initiatives.

The Education system: Entrepreneurship modules in the curriculum at different levels. Entrepreneurship education is now beginning to be anchored in tertiary education curricula. We have now moved past the old paradigm whereby entrepreneurship was to be taught only in Business faculties. The present Super GEM is a living example of the new paradigm whereby the subject is available to all undergraduates from all fields. An IT student, a Fashion & Design student and all the others in fact, need to know the basic business and entrepreneurship skills that are required to start a business or to act entrepreneurially, to lead and innovate in their employer organizations.

Period of Incubation: Entrepreneurship development programmes spread over a period of time (and not one off initiatives). Initiatives like “La semaine de l’Entrepreneuriat” are beneficial for general awareness, but the enthusiasm soon dies away after the caravan has left. What is truly beneficial for culture change is a planned process that uses all the avenues mentioned in this section over a longer period with set objectives and performance targets. In Finland, entrepreneurship and entrepreneurial culture developed as a result of a planned ‘Entrepreneurship decade’, that is, ten years of cultural change. This can take the form of entrepreneurship education starting at primary or secondary education level, targeting rural women with a Microcredit scheme and so on.

Participation of leaders (political, business, opinion): Political and religious leaders to promote entrepreneurship as a solution to current economic problems. As mentioned earlier under ‘leadership’, a strong, charismatic leadership is required to transform a community. To change the mentality from ‘qualifying to get a government job’ to ‘taking charge of oneself by being self employed’ requires psychological ‘push’ that can be facilitated by people who can influence the community. The first people to come to our mind are the political, social and religious leaders.

Creating and Mantaining an Entrepreneurial Culture

Culture is a hot buzzword among corporate and entrepreneurial companies alike. It's what everyone is striving for, what brings on the loyalty, what attracts and keeps the really awesome employees.

If done right, it seems so simple. Good corporate culture, in its purest sense, and at its most successful, has the look and feel of something organic and uncontrived, something that just exists. But alas, there's the rub, and at once the wonderful twist: Corporate culture cannot, does not and never will exist "just because." Culture is a balancing act between many elements of a company and requires careful execution at each level.

This is especially true for entrepreneurial companies, where what's going on is the building of a business as well as a culture. Corporate culture must be led, nurtured, constantly monitored and adjusted. Much like a "culture" in a petri dish, it requires that you combine the right ingredients, in the right way, to ensure that what you grow is not an aberration of your intentions.
Laying the Groundwork

When I founded Net Daemons, my computer consulting company, I had very definite ideas of what I wanted to provide for our future employees, a safe and comfortable environment, which enabled people to learn, grow and, at the same time, focus on their day-to-day work.

From early on, I felt it was important to treat every employee with trust and respect. That meant assuming automatically that each was an honest, hard-working, reliable and dependable individual. Rather than requiring all employees show up at nine and leave at five, for example, I expected each person to do the job assigned, and to apply the right amount of time and quality of skills toward the accomplishment of each task.

While I wasn't aware, back then, that I was creating what is now considered "corporate culture," I knew I was looking to create a place of employment where employees were at once valued for who they were and what they brought to the table. This was critical for our business, which sold knowledge and a system of collaboration between some 45 engineers providing network-administration and internet-development solutions. If a team isn't in sync, you can't sell a team approach, and you're no better than the single consultant.
What Makes a Culture Entrepreneurial?

As one of our engineers once put it, in an entrepreneurial culture, work is more than a job, it's a lifestyle. Employees are more like a team than in most companies, and in some cases, we're even like a family.

What also evolved was a set of rules for creating and maintaining NDA's petri dish. In creating your own, consider these rules:

•     Treat people with respect. This is a very simple premise, which threads through each and every complicated issue that can arise within a company. Respect and trust provide the necessary base for a vibrant and sustainable corporate culture.

•     Help employees stay healthy. When employees get sick, they miss work, so it makes sense to offer health insurance as a benefit. We covered 100% of employee health plans. I never want an employee to experience a catastrophic illness and not be covered by insurance. We also offered unlimited sick time. While I had seen this type of policy backfire elsewhere, it nonetheless allowed people to be sick when they really were sick, and not feel obligated to gobble up each "allotted" sick day. You may also want to add a wellness allowance for health-club membership.

•     Open doors to communication. Create an environment where people can interact with each other, support each other and recognize each others efforts and achievements. Provide positive rewards for positive behavior. Share information, so that employees are aware of the direction of the company and are involved in it. Use all-hands meetings for financial and operational information, team-building and social events. Offer incentive programs to reward effort and improve quality of life.

•     Build camaraderie. Make time for people to get to know each other and the company. We held an annual off-site meeting to build team spirit and discuss where the company was going. At such events you can also distribute and share your business plan and discuss issues and ideas raised by your strategies.

Maintaining Entrepreneurial Culture

Once you have healthy, trusted and informed employees, don't let the culture that's evolving just be. It needs to be watched so that it grows as you intended. The trick is standing back, but not too far back. In maintaining your culture, consider these rules.

•     Let the team build itself. Within that safe, comfortable, open environment, let employees grow together without being made to.

•     Participate without controlling. Let the culture thrive, without your either meddling with it or ignoring it.

•     Don't forget the little things. Culture is made up of many small actions that, when put together, create something larger than the sum of the parts. There are many things a CEO can do to make employees feel a part of the company. Some are just common courtesies: hallway conversations, saying "hello" in the morning, opening doors, asking after people's families and partners. Others are little extras, such as flowers to say thank you and happy-birthday e-mail messages. Eating lunch with employees, helping spouses find jobs and participating in team events show that you, the CEO, are involved with your employees.

Treating employees with respect helps enable them to do their jobs to the best of their abilities. If you challenge people to raise their bars, provide fun activities, keep people informed and humanize your management, you get culture. From these basics, you will grow in your petri dish a strong, healthy culture that will allow you, your company and your employees to flourish.


   By Jennifer Lawton, Owner, Just Books, Inc.

Facts and myths about business

What makes Datuk Maznah a more remarkable person is her generosity in sharing her success with the public and the younger generation. A much sought-after motivational speaker, she has made several appearances on television, radio, magazines and newspapers sharing experience, knowledge and wisdom in steering successful entrepreneurship ventures.

Here's what you can learn from Datuk Maznah Hamid:

1. Being a woman is never a weakness.

Coming from the so-called weaker gender should never be an excuse for a woman not to make it big in the business field. Datuk Maznah is a living testimony on how women can vigorously compete in a field often dictated by the opposite sex. She has chosen a niche where no other woman dare enter and exceptionally showcases her business talent. At the peak of Securiforce's achievement, Datuk Maznah was a boss to over 4,000 male workers and was a highly familiar face in an industry hugely dominated by men.

2. Money is not the greatest challenge.

Money—or more accurately, the lack of it—can be a major issue for someone aspiring to start a business. For a new entrepreneur, absence of experience and exposure makes the task acquiring financial help or loan even more daunting. But Datuk Maznah is a strong believer that anyone can start a business with a very small capital. In fact, she started her business two decades ago using her hard-earned savings of RM5,000, much lower than many would have thought. With streamlined management, prudent expenditures and smart marketing tactics, success will be imminent.

Your gender should never be an excuse.

3. The harder the challenge, the better you get

Face it, this can be a tough world. Challenges come one after another. While we can make the best of preparation and due diligence, what comes next can really be beyond expectation. Some adversities may catch an aspiring entrepreneur by cruelly crushing the spirit. Datuk Maznah treats challenges not as a hindering factor, but a motivational drive. She once delivered one of her daughters in a slum without electricity. Since then, she determined to change her family's fortune. She knows one can only get tougher with challenges.

4. Always be ready to improvise.

In business, some creativity helps. Improvising certain aspects of business operation can facilitate sustenance of business especially during trying times. In the early days of her security business, the company often found itself having insufficient money to pay the workers' salary. To help mitigate the problem, Datuk Maznah offered to cook meals for her workers instead of paying cash. When the financial situation improved, she paid all back wages owing to the workers. There were times too when Datuk Maznah herself worked as one of the night-shift guard. If you are determined enough to taste success, you will find ways to create solutions to whatever issues that may come.