Edmas Neo claims his first business failure led to a very fruitful career, firstly within a large company, then back to his roots as an entrepreneur.
Today, as Executive Director of the Action Community for Entrepreneurship, he helps open doors for other Singaporean entrepreneurs by providing them with international market access opportunities and innovative collaborations.
Neo started his first business as an Electrical Engineering student at the Nanyang Technological University in the mid-1990s. He wanted the challenge of running his own business in a challenging field.
“In Singapore at that time, a lot of people just wanted to work with multinational corporations (MNCs). That was considered the ultimate success. But I wanted something different, to take a risk and test my mettle. Being engineer-trained, I really just wanted the satisfaction of creating something original for our market,” he said.
He and a university friend started a web hosting company, Singlinks. They also wanted to create a Singapore-based search engine. As he related the story, there was a sense of excitement in his voice as if he were travelling back in time to the moment they conceptualised the idea.
The excitement did not last.
The pitch of his voice shifted downward as he started telling me how, after one and a half years, they realised they just couldn’t make it work.
“Because the internet was very new, the cost of running our own servers was very large. The cost of the connection was very high – it cost us easily S$1,000 just for a 64 kbps line. We were also very much on our own. There was no ecosystem or even venture capitalists,” he said with a tinge of frustration.
Most of all, he admitted he and his business partner had not done the required market research. At the time, their potential customers had not been exposed to the merits of an online presence as their own customers were not online
“A lot of my friends had good and stable jobs at MNCs. We, on the other hand, were struggling. We couldn’t even pay ourselves at first. We also had to deal with our own emotions.”
It was his partner who first decided to give up the business to pursue a “good and stable job”.
“He had a lot of pressure from friends and family. I understood and eventually we decided to sell it to a friend who ran a computer business.”
BEING AN “INTRAPRENEUR”
They managed to break even and began careers in large companies. Neo headed to IBM, armed with the lessons he learnt as an entrepreneur.
“When I went to work, I didn’t see myself as an employee. I saw myself as an entrepreneur selling my services to a company – an intrapreneur. I also picked up a lot of domain knowledge from these companies. I learnt how to run a proper business, how to understand customers. It made me a better entrepreneur.”
Prior to joining the Action Community for Entrepreneurship (ACE), he was Regional Director, Partnership and Collaborative Innovation at Singapore Innovate (SGInnovate), a venture capital firm and startup ecosystem builder wholly owned by the Singapore Government.
Today, he also runs his own firm, Accrete Innovation, which provides acceleration and market access services for start-ups.
“WE ARE TOO SHELTERED TO BE ENTREPRENEURIAL OR INNOVATIVE”
“Entrepreneurs need to be innovative. They need to identify the problems and find new ways of solving them and come up with a creative way to bring the services to the market. That is the difference between entrepreneurs and businessmen,” he said.
“Some people are natural problem-solvers, hence natural entrepreneurs. But there are also people who become entrepreneurs because of circumstances. It could be because of structural changes, they’ve lost their jobs and then decide to start a business.”
Was he implying that the second variety of entrepreneurs would be less successful.
“Not necessarily. As long as they change their mindsets, they can be successful too.”
“I sometimes think, in Singapore, we are too sheltered to be entrepreneurial or innovative. We need to create an environment and opportunities for people to be willing to be innovative, to identify new areas of solving problems.”
What would such an environment look like and how can it be created here?
“One key thing about Singapore is that we might not have enough challenging problems to solve, compared to certain countries around the region where they really have a lot of challenging environmental issues or even poverty. They are able to come up with transformational technology that can help change lives.The young in Singapore need to be exposed to problems. Their creativity can be sparked when they have to think of innovative solutions to solve them.”
So his organisation is working to expose young people to different business domains.
“For a young startup that may not have good domain knowledge, they may not even have the ability to uncover that there is this problem to be solved. So one way is really to expose our entrepreneurs or our youths into certain domain, through mentorship, through an exchange of ideas.”
He cited the shipping sector as an example. Sending young people to talk with experts about the challenges is making them come up with innovative solution to solve problems.
His aim is to make this spirit infectious, to start with as many young people as possible so that even those of us who don’t ultimately become business owners, approach tasks as an innovative entrepreneur. He wants to increase student exchange programmes through which students are exposed to challenges in other countries and encouraged to come up with innovative solutions.
He does some of this already through the ACE International Centre.
The centre is taking market access programmes for businesses to a new level, moving beyond two or three-day roadshows and exhibitions to market immersion programmes, connecting them with the right partners.
“I didn’t have that kind of help in the early years,” he said.
A LACK OF PERSISTENCE AND PERSEVERANCE?
So are ACE’s initiatives molly-coddling entrepreneurs?
“We try to strike a balance. We just make it easier in terms of facilitation, but those who expect more and are dependent on the government or the ecosystem to provide help, need to learn to take the relationships further themselves. You need to be persistent and persevere and if life is too easy for you, I think we would attract a lot of people who may not be of the entrepreneur quality into the ecosystem. In the long run, we will see a lot of failures.”
He also feels that some entrepreneurs are not persistent when it comes to following through.
“Singapore started off as a trading hub and we are very good at buying and selling things. So maybe certain entrepreneurs in our ecosystem feel that when you build your business, you should sell the business if you can do so at a profit instead of nurturing the company long enough to create a big, impactful world-class business.”
His experience at SGInnovate also taught him that business people here tend to have high expectations.
“There are entrepreneurs who feel that they are ready to expand overseas and we should invest in them and get them connected, but when we look at their business, in fact, the company is not of the right size to expand or maybe the market they want to go to is not suitable for them. So we would like them to do a little bit more research, to be more ready, but some of them don’t want to do the work and get impatient.”
Neo said he has personally always wanted to be as inclusive as possible, “help anyone with the aspiration to be entrepreneurs and give them the kind of support that we can to help them get started”, but there is a need to identify the more high-potential ones and people need to do the work to get to that stage themselves.
Having said that, more has been done by the government and organisations like his to expose businesses to accelerators to help companies reach the “high potential” stage.
But the dependency mindset remains.
“Certain entrepreneurs feel that they should receive more support but do they really need it?”
ENCOURAGING INDEPENDENCE AND RESILIENCE
His exuberance took over again as we discussed how to help small and medium enterprises shrug off this mentality and innovate on their own. He is determined to do it well and there are several stages in the process.
“We need to help them see the vision. First, just expose the company to what others are doing in terms of adopting technology. But they may not be ready so we shouldn’t push them too hard. We should just plug them in and let them know what’s happening.”
The next step is to help discover how they can become more involved in the activities in the ecosystem. Engagement through co-innovation exercises with other companies is next.
“After that we can have acceleration, meaning that they could do an entire programme on their own but at the same time build up the readiness and innovation capabilities internally and conduct the cultural change. Finally, it’s about sustainable innovation – to keep the process going.”
The key is for it to happen gradually.
“I’ve seen cases where people take a company that is at the initial stage and force them to do acceleration on a very big scale and it fails prematurely.”
“WE ARE GOOD AT FOLLOWING PROCESSES, NOT MANY WANT TO TAKE RISKS”
Neo feels Singapore’s early focus on attracting MNCs has also had an impact on mindsets.
“As a result of these MNCs, we have trained a lot of professionals and managers. So we’re good at following processes and not many want to take risks.”
I raised the high-cost environment as an additional deterrent.
He agreed, “So for the potential entrepreneur, this would be one of the key considerations. Do I want to start a business if I have two kids in school right now? Or do I want to spend my time looking for a job?”
I pointed out there is a lot of uncertainty in the jobs arena as well.
“But with some upskilling, you can probably have a more stable life and that’s what a lot of people still seem to want,” he said.
He believes in order to help potential entrepreneurs feel the fear and do it anyway, there need to be more support schemes. Aside from looking into high rentals, he suggested other measures.
“Can we perhaps provide some support to the children of entrepreneurs when they are starting university? Can we help them defer some of these costs? We can provide certain support in other areas surrounding their families so that they get better family support and they do not need to be worried about the family and can focus on the business.”
He was referring to middle-class families who may not be eligible for existing government support schemes.
I remarked this might increase the dependency mindset that he had criticised earlier in our interview.
“If it’s done in a limited conditional fashion, with them paying back the amount, I think people will be more prudent about it. At the same time, it gives them some breathing space to take risks and be more resilient.”
Throughout the interview, it was apparent that Neo fervently believes in creating successful local businesses. I pointed out that any economy needs regular employees too, not just entrepreneurs. This was when his enduring business philosophy became apparent.
“I think at the end of the day, each one of us needs to act as an entrepreneur, whether you’re working for someone or running your own businesses. We need creative solutions as employees too. It’s all about bettering the lives people, of your customers, providing better services. It’s about empathy and problem-solving and we could all use that, whatever we do.”