Saturday, 23 March 2019

Start My Own, or Stay with Current Job

Prompted by another blogger SI, I wrote this article. Addressing the question, there are always the push the and the pull factors. Let’s evaluate both sides of the coins.

PUSH

Current job is shitty. Lousy pay, lousy boss, lousy colleagues, low satisfaction etc. Time to move on to start my own. To take control of our own destiny where we are not answerable to our boss, and create something that can impact the world with abundance of self-satisfaction.

PULL

Excellent idea awaiting to explode. A good partner or investor already knocking at the door. Too good to resist because it’s going to be something even bigger than Apple, facebook or Alibaba...?

REALITY CHECK

Good to think big, but also need to embrace reality. Both hand in hand.

Ask: In work, why is everyone or everything is so lousy? Or why is every job so shitty even I changed several? Often times, we should also reflect about ourselves. Are problems from us too? This is what we meant by “do not escape”!

Maybe starting your own is even worst when we are not ready. You are no longer answerable to your boss, but you are answerable to your clients who may even be more detesting.

No income, no more colleagues to help, and if you are unlucky, an untrustworthy partner (over time). You may spend tremendous amount of time and effort, but still low return of income during the starting years. Worst of all, all the investment savings are all down to drain eventually due to immaturity and lack of wisdom.

I am a super positive person as friends know me. I myself aspire to start my own. Hence I am not being negative but pragmatic and evaluating both sides of the coin.

REAL LIFE EXAMPLE

I had a business associate in his later year of life and career. Let’s call him Mr. S. He started his own business close to 40 years ago. Mr. S is experienced in his field, work very hard and has good integrity and name in the business. Few years ago, he told me to start my own because he started his own, and that is the best thing that ever happened to him. His business grew over the decades with good revenue and clientele list. During its peak, workers of close to 200. Things took a turn due to the sustained market crisis in the last few years, he is now facing bankruptcy, high debts accumulated and having re-pumped in all his personal monies into the company. Worst of all, I see the stress and despair.

What makes you think you will do better than Mr. S and not fall into the same situation?
It is not about the money anymore! It’s about the sweat and blood put in for 4 decades and the ending is “emptiness!” and opportunity cost of not having enough time with family and friends.

Of course, I also know many success stories. My very own sister is a businesswoman. My ex-boss who sold his business eventually leading to loads of millions.  

All I want to advocate is: THINK carefully and do the necessary checks before impulse come into play! Especially for those who have family burden.

HOW TO EVALUATE SHOULD I STAY OR LEAVE THEN?

I cannot advise for you. Different people different situation. But what I can do here is to share my own experience based on the circumstances.

Aside from the basis of “WHY”, “HOW”, “WHAT”, “WHERE” and “WHEN” to start which you need to decide for yourself, I also delve into several detail checks. Hopefully it can help  you and me. J

Check 1 –  Check if you do well in your current job?
If you cannot even do well in your current job, what makes you think you will do well if you start your own, which is essentially tougher. One person I will like to make reference to is John Lim of ARA. He was doing really well as a corporate employee when Lee Kah Shing spotted him. He took a leap of faith at the age of 45 to start ARA.

Gauge for me: Yes, I am doing well in my current job. At least for my standard, or at least my boss, colleagues and people within my market are telling me that. I have been in the same market since 15-20 years ago. Know the products well and know many people within the industry all over the world. SO YES, I pass this check!

Check 2 – Financial Health
A friend of mine quit his job when market is still down and tell me how excited he is because he is starting his business, because he is getting out of the shit in his current job. Then I asked him if he is financially ready? He said yes, because he is without kids and have some savings and at most can sell his car. 3 months later, he panicked because of no income and lots of work expenses! He is still without a job after more than 1 year and savings are all draining and worst of all, he is straining with stress.

It is important not to just consider savings as our lifeline for starting a new business, unless your savings is so huge. But then again, if your savings is really that huge, why start your own when you can possibly invest. Anyway, my point is, it is better to have a transition of income reduction. E.g. your salary is your 100% income. To start your own, you will suddenly start with $0. This is “No No” for me. At least my income reduces to 50% or to a stage where my expenses can still be paid for from other source of income. E.g. rental income, investment income, freelancing income etc.

More important for me is, I will start in a business which is without huge cash outlay upfront and able to generate cashflow for even during the initial part. Most cafĂ© owners invested heavily upfront and find out that cashflow is not coming in reference to invested and operating expenses, that soon they folded.  

Gauge for me : If I were to start a new business, it will definitely be something I am good at for already many years. E.g only... perhaps I can first become a consultant (sign a 1-2 year contract) for a foreign company I know well working 2-3days a week, or they know me well within the market I am familiar in. This will keep cashflow coming in, and yet, I have excess time to work on developing my own business bit by bit. First being an intermediary, then developing my own product etc. Then I also have my property rental income to sustain some of my expenses. Wife is still working to also sustain burden. And possibly investment returns. Only in desperate measures, I will allow to drain my savings. But this is already very serious

Actually, I been approached a few times in such situation from foreign company who knows me well, but time is not ripe because I wanted my financial situation to be even more stronger. Remember: Savings will always deplete faster than you think. Better to have a transition reduction in income when you resign from job and start your own!

So NO, I am not comfortable. Check failed.

Check 3 – Family Burden
This is for those who are married with kids. If you are having young kids, and cherish the time with them, then it is quite unlikely you are able to juggle between time of starting your own and time spent on them. Opportunity cost! Most will want to think that “who says I cannot have enough time for my kids when I start my own”. Yes you can, but for sure you will not do as well for both areas. You are creating a “LIE” for yourself. Starting your own is always most difficult in the first few years. So it is certain that family time will be sacrificed. Are you willing to do that? Is your wife ready to take the family burden?

Check 5 – Right Ideas + Right partners
Fantastic ideas are always essential for good business. But that said, we often always start with crappy ideas, and learn from there to develop better ideas as we have more experience. So unlike many people who think right ideas are all important, perhaps a right partner is even more important for a start.

Ideas are not as ideal without fantastic partners. Finding the right partners are not easy. Recently a friend of mine split with his business partners because of “trust” issues. My brother in law had been doing his own business for ~25 years, and his best partner is my sister (his wife)!

In my work experiences, I also see success in partners who one is commercial and the other one is technically inclined. I also know 2 partners who are best friends and both have equal share in the company. I asked them, “what if Mr. A say “YES” and Mr. B say “NO” to a proposal, so what’s the decision? They told me if one disagree, then “NO GO”! They will only go ahead with decision when both agrees. And because they know each other as best friends, so far it works for them for the last 15 years.

John Lim and Lee Kah Shing started ARA. To Lee, it is an investment he has no problem losing if it fails, relative to his net worth. For John Lim, it is a must win, because he depended on it. And Lee trusted Lim because of his capability as Lee already had a working relationship with Lim. Hence Lim (capability + hard work + cannot fail) + Lee (wealth + connections + experiences) = success!

Gauge for me : No partner identified for now. I will probably start myself first, then start finding partner later. “Trust”, “friendships”, “loyalty” and being different from skill-set I have is important criteria me to find a partner.

Check 5 – Timing
Is it the right timing? This links to almost all of the above points discussed.

Gauge for me : I still love my job travelling and meeting people and making deals, despite the politics which I manage reasonably well. My priority is to serve the Lord as I work. I am able to do that in my present job. So no complains. I prefer to have my mortgage cleared within next 5 years. Should be able to do that in 5 years time, hopefully. I have children who are still young, with the youngest at 2 years old. I prefer to spend more time with them in the next couple of years. To start my own now, its huge opportunity cost not having sufficient time with my family.

John Lim started ARA at the age of 45. It’s not too late for me then. And as my blog wrote, its better late than never! I reckon I still need couple of years ahead before I start my own! I have to be patient and sensible now to be successful in a godly manner later!








Friday, 22 March 2019

Bitcoin, Then & Now – Loving the unloved?


THEN

Towards the end of 2017 early 2018, the most talked about investment topic was the buying of crypto-currency. The news of Bitcoin is everywhere. Even aunties and uncles talked about it. My wife who knew nothing about investment told me about Bitcoin (BTC) and how her colleagues and friends mentioned to her.

Another friend of mine back then, ask if I should start looking into investing in the Crypto mining business as his uncle is quitting his job and poured in close to S$200k into the Crypto mining business.

I also have clients from abroad telling me how excited they are because they were into ICO (Initial Coin Offerings), and were destined to make big bucks. They chose to put aside their core business to focus on ICO. During our conversation, I knew that they do not really understand how crypto-trade works, as their only interest is to make money.

NOW

Rarely you hear any aunties and uncles talk on the streets nowadays about crypto. My friend told me this year that his uncle lost all the monies he invested in the mining machines and are no longer in the business. I also met with my overseas clients this year and asked if they earn big bucks from Crypto, the topic was cut short with an awkward grin.

So the frenzy about BTC died down just as the price was sent tumbling down from the high of US$19K in late Dec 2017, to US$3-4K per BTC now. ~500% down.


source: www.buybitcoinworldwide.com/price


LOVING THE UNLOVED

So in my opinion, Crypto-investment has become the unloved, un-talk-about, or even possibly under-valued? Ok, forgive my opinion about under-valued. I am by no means a Crypto guru, even if I did my own research about Crypto and blockchain before. 

But all I know is I can afford small portion of my portfolio to "experience" BTC ownerships. So I went through all the troubles to find out how to own Bitcoin having already understand it, created my CoinHako account, did few verifications and managed to purchase couple of BTC unit.

And yes, I am a proud owner of BTC now when no one is talking about it! 

Anyway, I am a believer that the mainstream is normally almost always wrong over the long term. I wrote about that in this article. Refer here.

To support my point, I was talking with my child’s classmate’s parent recently. He was interested in investment and I mentioned how about buying BTC, gold and silver etc? The BTC topic raised a few eyebrows as he told me he was burned from it and will never touch it again. I highlighted that now BTC is unloved and perhaps good time to buy? Moreover, price dropped a lot. He shook his head and the topic goes to gold and silver...

LOOKING BACK

On 14 Dec 2017 when BTC is at its peak value, I cut and paste a joke of Bitcoin onto my Blog titled “Monkey Business”. Refer here.

Towards the end of the joke states: It will make a lot of people bankrupt and a few people filthy rich in this monkey business.”

And indeed, all I know is my friend’s uncle is sort of bankrupt with his life-savings wiped out. And perhaps many more out there whom I do not know. Undeniably, there will be some of those out there who will eventually get rich via investment in Crypto, but they still remain the minority. 

Everyone always think that they are the minority who will win, but most of the time, their actions already tell us they are not.  

So the joke has some truth in it and it does not mean Monkey business is no good. End of the day, you must understand the Monkey business and know how and when to use the value of the Monkey.

For e.g if the market crash, one sort of company I will invest in is Bitcoin technology company. 

Don’t ask me why I don’t invest now then….