2015 is just hours away, and I figure this would be a good time to share my experiences that I have picked up over the years in case some of you who are interested in embarking on this journey in the new year.

I do not have anything to back up my data, but the number of FnB places turnover rate (open and close down) to me is quite substantial. It is one of the most sexy seduction businesses to start cause let’s face it everyone needs to eat and it’s something that can be comprehend by people on how it works, and not some  1 billion dollar funding on some app.

To start off, please take your time to do your homework first and not just in terms of product testing. We are still learning as we go along, and there are a lot more things to learn for this next stage. Don’t be deceived by number of outlets of a brand, they are playing a different ball game, sometimes it’s just money leveraging on money to grow. An easy way is to visit an outlet and do some math. FnB is one of the industry which you can easily calculate the earnings of a business. You have to respect this step before you even thinking of raising funds or pitch to investor.

Now for the pointers

1. YOUR PRODUCT IS KING
   Being a Malaysian, I have to say we are passionate about what goes into our stomach and the level of “virality” of something delicious that goes into our stomach is super high. You do this, you save on marketing to a certain extent. Your product speaks for itself. However, do note that product development requires a lot of time and effort, just like designing the next BMW 3 series for example. Even making good coffee requires a certain level of science. My partners and team do a really good job with this and you got to respect science. It doesn’t mean you have to use imported ingredients all the time to create a good product. There is an opportunity for good product to be created at every price point. Another consideration is the challenge you will faec to scale up your food production. Sometimes you will have to decide where do you stand in terms of scaling up vs maintaining food quality.
2. DON’T START FOR MONEY, START FOR SUSTAINABILITY
   I once went to a Startup Grind Event, and Carlist ex founder Ewe Jin stressed several times in his sharing “Don’t take Shortcuts”. The reason for this is that if you are starting something for long term (instead of playing the business flipping game) then you have to plan out sustainability rather than starting for money. This means quality of product and service are essential to be the main focus and not overlook them. It’s a people business at the end of the day, and the relationship created between the customers and the brand is highly important as it is a really strong value add for your FnB business. Food is something really personal to everyone. Hence, you will need to provide good training to your team.
   *Tip: Start with why
3. YOUR STARTING FOUNDERS
   This is one of the most sought after dilemma, believe me. Because of how the industry is such a heavy CAPEX intensive business, I know a lot of FnB startups usually would have averagely 3 shareholders. The reason why this is covered here is because there are also a lot of startups fail due to the fall out of partners. Looking for founders to startup with is really like a marriage. There are a lot of considerations in mind and a certain level of risk taking is needed. Please  get at least 2 people to be hands on if you do start a FnB. Don’t simply burn your cash by putting your money in and don’t bother contributing. You may be better off giving it to me instead. Please lay out distinct responsibilities of each other and what each other can bring to the table. If you are purely an investor, please take a smaller chunk of the business and trust your Founding Team Members who are hands on, if not then why join them in the first place. Give them advice, guidance or pass on some contacts to them as well that would help everyone to win cause if the business wins, you win.
4. NUMBERS
   Respect those numbers. I’m always sad to see people starting off a FnB and didn’t work out later, cause the initially CAPEX outlay is just a lot. I rather you go and start a blog shop or something if you decide to be overconfident with this. Do your financial forecast with low, medium and high when you are starting out.
   Be realistic! Low would give you a mindset on what’s the minimum of what you are content and happy to live with. High would be a goal you set for yourself to get there.
   Plan out your CAPEX properly with always a minimum of 10% buffer for unaccounted cost and lay out your monthly sunk cost – Internet bills, electricity, water, staffing, pest control, insurance (which are almost consistent every month). This is why I said it’s one of those business which you can study and estimate brands earnings easily.
   Now with all these, it’s important to keep in mind of a net pre-tax margin of 15-20% and a gross margin of 65-75% margin on your food cost. This is the average financial performance of the industry and it would be a good guideline for your budget if when deciding on whether to embark on a mall or a shoplot or a food truck.
   Then again, these industry averages are just theory, it changes at every stage of scaling up and growth, you really need to plan forecast and execution properly for this.
5. LOCATION
   Your numbers would determine your location. There is no perfect location, cause if you want a good one, you got to pay for the rental. First and foremost it’s important to identify what cuisine are you serving, that would help you to narrow down the adoption maturity of a particular community to what food you are serving.
   Next is your concept, quick serve (eg young hip students) or sit down (eg families or people who would sit down and chit chat couple of hours).  Then the price point and margins of your product. High price point doesn’t equate higher margins (FYI) cause your volume may be much lower than a lower margin price point.
   After that is visibility and neighboring business types/history of location. It doesn’t mean high visibility works for all, believe  me. Some are better off hidden (have to look for kind of place), but your neighboring business types is important to be a consideration because they could be your crowd puller.
6. TYPE OF BUSINESS MODEL/GAME
   As mentioned earlier, don’t be deceive by what it looks on the surface. Do your numbers. There are a lot of business model out there to be adopted (Franchising, Joint Venture, raising funds through PE; Malls vs Shoplots vs Airports vs Food truck). A good start is to do reverse engineering on where you wanna be in the future.
   A lot of businesses play on leverage for FnB, that’s how you see the big brands thrive sometimes. A lot of hot money can flow into your business when you do it right, but you got to know where/how you gonna spend that hot money to make sure everyone sustains. Your intention does count – whether you want to do it for yourself or you want to do it together to win.
   Different stages of your business lifecycle would require different level of financial leverage. You can Google up what happen to the TGI Fridays family and the Library Group family with their equity divestment. There’s a lot of backstory to businesses. Even the local Burger King take over by Brahim’s is also a good story to learn from. It doesn’t mean that if TechCrunch or Digital News Asia doesn’t pickup, it’s not a good story. I always think in every story we can learn something.
7. MORE OUTLETS =/= MORE MONEY EARNED
   If you have not learnt economics, please google up Economies of Scale and Diseconomies of Scale and please respect this theory. This is important to tune your mindset when you decide to embark on a FnB.
   Having more outlets does not equate to a guarantee on earning more money. But it sure means that you would need a lot more capital outflow (CAPEX for you accounting, finance geeks).
   Starting one outlet is a different game as opening up more than one. Some concepts work better with one outlet, some concepts work better with 10 outlets, some concepts work better with 100 outlets. And this would help you to plan out and tweak out your business model.
   When you scale up, operationally it becomes really important apart from focusing on the quality of service and food in your one single outlet. Every 10 cents of cost when scaling up means a lot. It becomes a volume game as well.
   Starting small may not be bad idea after all. Two brands which I personally love is myElephant and Red Bean Bag. Both businesses grow at a decent pace in my opinion with a good sustainable culture behind it.
8. FINANCIAL LEVERAGE
   There will be a stage where you need to learn how to do financial leverage to scale even if it’s opening 2 or 3 more outlets. The 3 most common options are always bank financing or equity financing or franchise/license fee financing. Now this is where your founders have to be financially educated when you do decide to take this route because each shareholder may have to be diluted according to their investment %. This is quite important to be discussed at the beginning of the formation of the company so that everyone would understand each other’s risk profile. There are just a lot of financial instruments at this stage but please start learning.
9. GOOD AT COOKING =/= SUCCESSFUL IN FNB
   If you are good at cooking doesn’t mean you will succeed in having a FnB place. There’s a lot of elements to it. Which is why it’s important to have at least 2 people to do check and balance with each other. I would highly recommend 2-3. There’s just a lot of areas to cover when you are starting off.
10. SOCIAL MEDIA MARKETING IS NOT EVERYTHING PLEASE
    If some guru comes to you and say how great they can help you on social media and all, please take a moment, breathe and say you will consider it. All platforms are overcrowded now, so please don’t be deceive by it. Your number of fans or followers is not everything in this world. Get the food right, and a certain extent number of people will come. Plus if you are in Klang Valley, EatDrinkKL will definitely pick it up so don’t worry.
11. YOUR MINDSET
    Lastly, you got to get your mindset right when you are starting up, what more when it’s a retail operation business. If you were working before this, say goodbyes to your weekends and public holidays cause they will most likely be your best days for your business. If you are working long hours before this (like me in PwC for 4 months) you want to thank them for making you resilient already towards long hours. At the end of the day when you start up a FnB place, the focus is shifted to the people you serve from Day 1 onwards, no longer on to yourself. So be prepared!

These are some general basic level tips. I hope this would help you save some cash to pay some consultant for advice if you are starting up. Best way to learn – start small, start fast, start smart.

If there’s a certain level of interest to share more about FnB, just comment below and I see what else I can share the next time around.

The part of hard things in a company is change. Change is always bound to happen, over time, as time control lots of things. Time imposes relativity with prompts for comparison which leads to the general term of “change” – as there is always a comparison between time.

2 and a half years of venturing out into the so called business world, one thing which I have learnt – is to be ok to attach an emotion to an event but not to allow the emotion to lead the way. Change has been inevitable only if we want to stay relevant, and not because it’s a must sometimes. I have learnt how to dealt with it, though the emotional part of things make me human, but sometimes change would have to exist for the better of the most.

Change has always been and will be a choice, whether the intention to stay relevant exist.

Then there are those who would embrace change together, cause maybe they allow themselves to see the potential of growing, which can only exist with change.

Then there are those who feel indifferent, which whatever is typed here has no meaning anyway.

Then there are those who are against change, maybe because of a strong emotion which has been attached to it which enables them to feel secure, feel alive. Or maybe it’s because the in existent of intention to stay relevant.

Different things are required at different stages of things to work. Just like how your car service milestone changes according to the milestone driven and the intensity of usage. At the end of the day, is knowing what could seem to work for the  greater, cause we will never know if it works for all (which only exist in our wanting to be right perception).

So what’s your experience in change? Whether in business, personal growth or in relationship. The 3 common classification of events happening in our lives.

The ever debating topic for any companies is always about valuation or the right move/strategy. And often times, it’s so dreading whenever a group of people are deciding on what is the “right” move. All the energy could be sucked out of ourselves for figuring just this out.

Speaking from my experience of speaking first hand with investors and working with shareholders and partners, I have came to learnt and accept this fact:

“Everyone’s risk palette is different.”

And often times this is when decisions are stalled, conflicts happen. In one scenario, there are many instances or recommendations that people could lay out on the table. In the end, it’s not about what is the right or wrong valuation/move/strategy, but more of how much risk each is willing to take and willing to pivot if mistakes happen. At the end of the day, there are always times when we make a wrong move or we make a right move, but we would only know once the results unfold.

If you are student who is deciding what to study for college, hopefully this would help you. It’s one of those dreading moments filled with fear. 

Here’s a fun fact, on how many times you would know what the right move is more often than you realised it’s the wrong move. A right move could lead to the right result but a wrong result later on, which could be deemed by people as a wrong move. It is probably in the minds of human nature to pick up on negativity.  Nonetheless, the underlying question would come on whether how your organisation/company would embrace the space of making the so called “wrong move”.

Part of the Lean Startup Metholody that we adopted when starting myBurgerLab was the space and freedom to learn from trial and error. The space to embrace making mistakes and pivot creating an opportunity for us to say let’s try this and that on a really fast pace but low budget. Fast forward 2 years, sometimes things became more cautious and usually perception and the thought of “there could be more to lose” are the culprit. One thing I learnt is that embracing an act of making a mistake is more liberating than thinking on what would be the right move, cause in all honesty, seriously, every situation is distinct, even every economy growth or downfall is distinct. What worked the last time may not work this time or it could work even better this time.

Starting your own thing is a daunting experience if you are always thinking the right move from shareholding to business model. And don’t get me even started on recruitment – when all variables that may seem favourable just change one day. That is why they say people who are labelled “Entrepreneurs” are considered as risk takers, cause as a start, is quitting a temporary guaranteed monthly income stream for something unproven. And because everyone risk palette is different, don’t get bogged down by being a non-risk taker. Everyone has their judgment and perception, the question is “What is yours?”

If you trace back to every decision taken, it is based on the risk palette on how much you are willing to risk and what you are willing to risk. Right or wrong is just a matter or perception, just like a  game of poker. Or if you like to Draft in Magic the Gathering, then you would understand what it means by risk palette (probably it’s one of the reason why I love to play limited than constructed 🙂 )

My good friend, Aaron, shared me an article which sparked the inspiration to writing this. Read about it here – http://www.bothsidesofthetable.com/2014/10/05/three-words-every-entrepreneur-and-vc-should-take-to-heart/

For some reasons, I have stumbled upon many articles touching on stories of various entrepreneur’s journey in the startup scene – the lonely, depressive state of mind. Speaking about the law of attraction of negativity. Anyway……

I have met many people/students lately who claims and expressed their strong desire of wanting to be an Entrepreneur. Can’t blame them, with so many government initiative lately to foster startups, it’s no surprise that many people have decided to step up. Positively looking at them with a smile while reflecting back my journey made me meant what I meant when I say “Good Luck”. As much as many people would say it’s good to be naive and fearless when you start something, there’s a lot of responsibilities to bear on your shoulder if you decide to choose this route. Then again, everyone has a choice at the end of the day.

What is unsaid or unseen does not mean that is unfelt. For most times, the media has made a lot of their readers felt motivated/inspired to start their own thing without really reflecting grassroots relatable emotions in the article. Multi-million dollar funding, investors pitching, IPO. All these are usually the highlights of the media, blurring the lines of what the founders’ motivation behind are.

Yes, there are medias on the other hand that share positive advice of various entrepreneurs, with the recent popular Jack Ma’s article and sometimes we ended up taking them literally even without knowing how to flex/shift our minds when different situation crops up. A good example would be the ever famous quote by the late Steve Jobs “People don’t know what they want until you show it to them”, have indeed left many people feeling over confident and taking them literally. If you study the meaning and elements behind the inception stage, you will know there is a certain level of grounds that have been tested before the people think they so called don’t know they want the iPhone!

Why often times, the genuine feeling of an entrepreneur are often filtered by what is the overachieved rather than the actual feeling. Entrepreneurs are humans after all. I used to express all sort of feelings – love, joy, sadness, anger in my blogs back in high school days. Would admitting that I made a mistake or feeling afraid now would be a sign of weakness or incompetency. Again what is unspoken or unsaid does not mean that I am not scare. In fact I am more afraid of what is like to admit that I’m afraid – on whether people would judge or affect my organisations’ outlook. Would admitting it look weak or would it look like a sign of asking for help for a journey taken.

Yes I am afraid, I do feel lost at times too. I stare away sometimes wondering what would happen the next day, wondering whether we could make it through tough times, wondering about the welfare and future of each staff from ground level to the management team, wondering how we can better manage cost to keep prices low for the customers despite uncontrollable rising cost from the dominant. These are the never ending pounding questions for the prices we got to pay when we sign up for this journey.

There’s enough funders around the world really. And there’s  a lot of news in the world about successes. If I could offer something to a buddy aspiring entrepreneur, it would be my shoulder that I could afford and I know that is what entrepreneurs just need at times, including myself. Not the funding, not the media coverage story, but a genuine shoulder to lean on. That is probably why most of the real successful people in the world are humble, down to earth individuals, cause they know the feeling of climbing up and down a mountain.

The next time you see an entrepreneur/business people, know that they are neither more successful or wealthier than you. They have feelings too! Plus, success is measured differently for different individuals anyway. It is their choice to take on a different journey of responsibilities, but that does not mean you could have a 1 hour “How are you” conversations to support them. And to be honest, sometimes that is what we need instead of talking about our business, we are kinda tired of that sometimes. We just want some pure genuine conversations of what’s inside our hearts at the moment.

To all entrepreneurs out there, embrace the feelings you have there, for it is normal. We will learn to live another day and shift anyway, but embrace it, and not suppress it.

#ihavefeelingstoo  #ifeelafraidtoo  #ineedashouldertoo

This post relates mainly to sports (mainly from my Ultimate Frisbee experience), but adapting the analogy to business help to open up an insight for me.

Adapted from Wikipedia, the definition of seed is

A seed is a competitor or team in a sports or other tournament who is given a preliminary ranking for the purposes of the draw. Players/teams are “planted” into the bracket in a manner that is typically intended so that the best do not meet until later in the competition. 

Yes the seeding process does help with the intention so that the best do not meet until later in the competition, but I would like to touch on is the pre-tourney seeding psychology.

I have experienced Ultimate Frisbee tournaments for many years and at the start back in my Nottingham days, I personally was very anxious on who did we get to pair up in the group based on our seeding. Once the groupings are out, automatically I will be like oh shit, we got all the top teams in our group. What are we gonna do?

Fast forwarding to now, 6 years later, seeding to me is just mere indication for an organiser to do their job so that the strong teams can meet at the last few knockout stage and that the audience can have an exciting finals to watch. It’s part of the process, it’s their job, that’s a given.

But what I learnt from the last 12 months of experience from watching few tournaments and listening to conversation of many players couple along with some drama over how seeding is done not correctly, we humans somehow already decide to determine how our fate is going to be even before the game is played. It’s funny really that how seeding can be the scapegoat of how a team perform instead of what goes within a team’s training camp and the other team’s training camp.

This boils down to the core root of psychology for any teams in sports or any business organisations. Being paired up with strong teams in a group, and a complains comes from being unfair cause it’s going to be tough. But teams tend to forgot to see that it’s a compliment to them, that other teams are being hungry to labeled seeded 1 in the whole tournament, and who they are paired up against is hampering the thoughts.

When being seeded lower than higher – “Oh shoot, now we are gonna face the strong teams and it’s unfair cause we have done so well in the past, just recently we slipped up. Sigh this is quite unfair” The label of inferiority is already spreading to the team when that thought came about, of how so call “unlucky” we are to be seeded so low. Is there no better way to see this as a turnaround?

Many games is half won or lost even before the team enter the battlefield. Teams and players tend to forget that every moment is distinct from the rest and we tend to forget how a 5-1 lead can lead up to a slip of 5-6 in the end. Be cautious of how one player’s thought could infect the whole team. Be grounded at every training, to

1. Not to be carried away and take things lightly
2. Not feel inferior with own team performance against other teams’

I always enter every game as a fresh start, a blank canvas of sort cause anything is possible in a game. Playing with Soar High has demonstrated that. Seeing how U8 Soar grow during their prime time demonstrated that! The key question is does everyone see the same?

A company labeled 5 million dollar market cap may not be the same 1 year down the road, so why have their label have an effect on you? It’s like comparing ourselves with Mark Zuckerberg. Sometimes we forgot everyone’s journey is different.

Seeded top or bottom, does it matter? Some will still say yes. I say let what’s inside your training camp do the speaking cause the number 1 will never be number 1 if you don’t let it to be. If you are last, you can always get out from it.

Does your team even know where you want to go to begin with? Are you selling yourself out to achieve what could be possible? Is seeding just another scapegoat?

*Tip: The best time to experience this is always at a Frisbee Hat tournament. That’s why I love hat so much, besides the people I meet, cause everyone will start off with a blank canvas.

To all Malaysian teams, good luck for the upcoming Shark Alam Open 2014.

Another year has passed, which marked our year 2 anniversary for myBurgerLab on 10th July. We had our usual donation drive event again at both outlet this year. I have to say we are definitely overwhelmed by the total response given, with so many people have a good heart to contribute to the society again!

It has definitely been a lot more of emotional ups and downs in the last 12 months. It does feel like taking care of a child who is growing up from 1 year old to 2. A lot more consideration to be taken into account, after the giving birth startup stage. Just imagine how a parent has to plan for a child’s future education, welfare and personal development, that’s how it felt like. So if you are planning to start a business, do be prepared on what you are getting yourself into. Here’s some lessons to share with you.

1. Company Structure
   Starting this off as the first is important for many of you who plans to startup. How you plan your company structure, in terms of holdings, subsidiaries, associates is really crucial cause as it would determine how much of administrative cost you would have to spend extra or get to save. As important as having a business idea, this would help to determine how efficient your company would become. Oh and by the way, I’m not talking about organisational structure.
2. Dare to dream, set a goal, and then work backwards
   This I think is probably the biggest learning I have for the past 2 months, is to work backwards. As much as we always say we have a goal, we want to do this, but until you pen it down your detailed goal and dream, working backwards will not be able to start. Often times, many of us say let’s see how it goes or yeah we want to do this, do that, but there’s no concrete timeline and exact detail set.
   It’s not about whether it’s attainable or not, if you have already started your startup, congrats you are already doing something on it, which puts you ahead of many people. So don’t think about whether it’s attainable, cause if you didn’t set it, it will not be attained anyways.  Dare to Dream!
   Try it, just think big – 5 years, 10 years.
3. Financial Roadmap
   Now with your dream and goal set, come up with your financial roadmap.  I’m not sure about you successful folks, but would be great if you would share this with me way earlier cause it’s such an awesome revelation. Setting your exact financial goal for the business and then work backwards make everything look so clear really – revenue, costing, budgeting, staffing. It’s like planning for your child’s education fund. If you haven’t, try it really. Set your December net profit goal, and then calculate how many customers you would need, how many staff, how to handle cost.
   Your roadmap could go to years, and not just be limited to this year and this could be one of the main contributing factor to determine how your expansion plan is to be done.
4. Cash is like the blood stream in your body
   If you gonna start a business, you got to respect it no matter what. Cash is like the blood stream in your body, if it runs out, you will be deceased. If it’s dripping you would want to stop it, same goes as business. Fix the cash flow and ensure there’s cash flowing still, end it’s a deadend. Respect it and you will pull it through. Every drip counts.
5. Communication and assumption
   If your business has been running for more than 1  year, you would know what I mean on this. Communication errors are so common and a lot of it has got to do with assumption. When we assume, there’s when things slip out of place. A mentor once taught me if you break out “Assume” you will have “Ass” “U” and “Me”. So go figure.
   Have your team see that communication errors not just occur when team are not align, but it happens when each party assume as well.
   Remember what our parents always say “Why don’t you listen?”. They don’t say “Why don’t you hear?”, do they?
   #artoflistening
6. You want to grow? Then you got to grow them!
   The fact that you already have a baby to take care of doesn’t mean you only have just have that one thing to take care of. How your baby grow is how you grow the people around it – hence the awesome colleagues of yours who are pulling the weight to make sure the baby ends up walking and not crawling.
   The importance of talent development is one of the other biggest realisation in the past 12 years. A company can’t grow if no other leaders are being mold. People always question “Are leaders born or made?”, I would say both, and yes leaders can be made. To begin with, it’s quite a stupid question that was made to suppress those who think they can’t be a leader (IMO).
   You may have to
   – hold their hands
   – let them fall themselves so they know how to get up
   – question them
   – challenge them
   – watch them closely
   – use your secret weapon (every founder always have one :p)
7. Laying a strong foundation
   The importance of setting up a company culture, code of awesomeness, company vision is really important to lay the foundation of the company. In fact, this foundation would help you to manage and set the expectation of everyone who is coming in to work in your company.
   Why how important is this? Have you heard of “It takes a longer time to undo what has been done”? So you may not see it in 1 month, but you save a lot of time in the longer run. Hey econs major – it’s opportunity cost! 🙂
8. Always have a Backup Plan
   Plan B,  Plan C, Plan D, come up as many as you can for different scenarios. It’s like changing route in your GPS in case some ground in the city has a hole in it. You will never know when Godzilla unwanted circumstances will crawl up. Malaysians should be good at this, considering how much of circumstances we have to go through.
9. What you see doesn’t mean you know it all
   Have you considered how some FnB shops that are empty quite a lot of time still survive/exist for a long period of time. You must be thinking that they are losing money, well don’t judge. Cause what you don’t see could be their hidden secret formula and it could make you dump founded on how brilliant they can be.
   Be creative with your business model, you will never know what would work.
10. Urgency
    Business is like a sport, we got to continue to move forward non-stop, but we do not know when is the finishing line. And we have to always be on top of our game, putting urgency into what we do, because at the end of day any action is better than inaction, even though there’s always the limbo of being unsure of which is the right move or not. And speaking from experience, urgency is crucial, if not the prices we have to pay will be more in the future. And this is indeed a huge lesson!

Just 10 simple lessons to share. If you hit a wall, remember there’s always a light behind the tunnel, even you don’t know where that is. Go watch “Daylight” (1996) and get inspired.

In the mean time, feel free to look through our blog post on our anniversary here 🙂

Peace out.