The Betatron roadshow hit ‘The Wave’, a huge co-working space in Kwun Tong, last night on Tuesday 8th November. Kwun Tong is growing a startup hub and was one of the locations we knew we had to reach.
Jacky Lai was our guest entrepreneur speaker this week and we were all excited to hear his unique story, as he’s been through some extreme highs and lows during his journey.
In 2009, which he was still at University in the U.S, he founded Wavee. It was a ‘penny auction’ site which he grew to serve nearly 1 million customers. Not only did he manage to acquire customers, but he also managed to monetize them too, and generated an impressive annual revenue of US$40 million. Great work for a business he started from his college dorm room!
Unfortunately, though, the explosive growth didn’t last very long, as the U.S government got involved and enforced industry regulations which hit the business hard.
At this point, Jacky knew it was time to transition to something else, as the industry didn’t have the same growth potential. So he sold the business and decided to come back to his native Hong Kong to plan his next move.
His latest venture is Switchbox (switchboxhq.com), which is also known as 同道 in Chinese. It’s a mobile marketing automation company that empowers businesses to build better relationships with their customers through personalized engagements at scale.
The business is currently experiencing great traction and has been through the China Accelerator program as well as having several angel and VC investment rounds.
Learn from McDonald's
One of the key lessons Jacky has learned, after spending millions of US dollars marketing his products, was that entrepreneurs tend to only focus on building a great product. Which is obviously important, but his experience has taught him that in business, sometimes it matters more HOW you’re going to find your clients and successfully acquire them. Having an effective distribution strategy is the key to successfully scale.
This lesson reminds me of the reason why McDonald's is a huge success and generates over US$25 billion dollars per year. It’s not the world’s largest restaurant chain because they have the best food. Their underlying framework which has generated the growth is because of the LOCATION of their restaurants.
Ray Kroc, the founder of McDonald’s was once giving a speech to a group of MBA students. He asked them what business they thought he was in. The hamburger business of course, they all said. But no, he responded, “My business is real estate.”
He knew that having the best product (hamburgers) wasn’t that important. Was mattered the most was that he has the best distribution strategy to sell his product. And in his case, selling a physical product, it was having the most effective locations to ensure he’ll generate the most foot traffic and visibility for his stores.
The formed CFO of McDonald's, Harry J. Sonneborn is often quoted as having said "We are in the real estate business. The only reason we sell hamburgers is because they are the greatest producer of revenue from which our tenants can pay us rent."
How to be a great mentor?
When talking to graduates from other accelerator programmes, one of the most common recommendations on how the format can be improved is by having great mentors.
But what makes a great mentor?
We discussed this topic with a group of us who have either mentored or been mentored before in similar programmes.
Joining the panel were Fred Aragão (an entrepreneur and the UX Lead at HeathWallace), Felix Wong (the Growth Manager at The Wave and a Facilitator at Startup Weekend Hong Kong), Mike Kerr (Betatron’s programme manager) and myself.
Don’t only teach WHAT to do, but teach WHY it should be done
One of the key points which we all agreed on, was that it’s not only important for mentors to teach WHAT to do, but also WHY their mentees should be doing it.
For example, when I’m teaching digital marketing, it would be the easy way to tell them to launch a Facebook advertising campaign or focus on Search Engine Optimisation (SEO).
But, what matters most and will bring the best out of the mentees in the long run, is teaching the underlying reasons WHY they should be doing it. Explaining the reasons behind your advice is critically important to ensure that once the mentor/mentee relationship is over, they come away with a deeper understanding of the topic, so they can make better decisions moving forwards.
So, using digital marketing as an example, instead of only saying, “You should improve your search engine optimization”, it's more beneficial to mentor them on the steps which allow the mentee to determine that decision for themselves, in the future. Therefore first, they need to learn how to research if their product/service has high enough search volume to make SEO a worthwhile strategy to focus on.
Creating accountability is another key factor which makes an effective mentor. As entrepreneurs, we get distracted all the time by a multitude of tasks throughout our day. Therefore, setting specific time frames and deadlines for projects to be completed, helps keep your mentees on track and gives them a reason to get things done.
As an example, I once had a mentor and when he set me a task to complete, if I didn’t finish it by the deadline he set, I would have to buy the whole group dinner, next time we met. Little things like this, kept me on track, and ensured I got the work done.
The last thing you want from a mentor is someone who doesn’t seem fully committed to help you. If you send them an email, and don’t get a reply for two weeks, it can feel like a waste of time.
At Betatron, we want to ensure that all of our mentors are fully committed to helping our startups accepted, and that they are there to help, whenever needed. By setting the right expectations upfront, scheduling regular face-to-face meetings, and by being accessible by email and phone at all times, we endeavour to create the best structure to get the most of our mentor/mentee relationships.
There’s not long to go now until applications to Betatron close on the 25th November. For any startup based in Hong Kong, its an incredible opportunity to be part of the program and get mentored to successfully build and scale your startup.
Don’t miss out. Click here to apply.