December 2, 2022

Sapiensdigital

Sapiens Digital

5 Top Tips for Starting a Successful Tech Business

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Over the years, CityU has been actively encouraging young people to realise their entrepreneurial dreams through programmes such as the Patent Utility Challenge. Among the Challenge’s many esteemed judges, CityU’s Entrepreneur-in-Residence and alumnus, Dr. Bobby Liu, is renowned for his no-holds-barred advice for participating teams and budding tech-preneurs alike.

“I had nothing to lose”

Bobby is a self-made man who had a typical working-class upbringing in Hong Kong. Although there were hardships, he credits his past as one of the key driving factors behind his determination to start a business at 25 years old. “I had nothing to lose,” he says when recalling the time he founded Milton with his brother back in 1990. “We didn’t have a thorough plan – the opportunity just came and we seized it. With neither money nor connections, the most powerful capital we had were our brains and diligence.”

Today, Milton Holdings International Limited is an industry-leading total solutions provider of engineering plastics and specialty polymers with a strong presence in Hong Kong, China, and partnerships in Malaysia and Germany.

Bobby likens starting a business to training in life. Although failure is to be expected, he encourages those with ideas to give them a go anyway, sharing the following five tips:

1. Take profit and loss estimations seriously

According to Bobby, “profit and loss estimations can reflect whether you really know what you are doing and help you be objective when evaluating your business’s earning power.” In start-up competitions, he often sees participants omitting important operational costs or those that are likely to be incurred in the future such as their own salaries or office rental, resulting in a knock-on effect on profits as product or service prices become undervalued. 

The best way for budding tech-preneurs to learn how to better estimate profits and costs, Bobby thinks, is by participating in these start-up competitions if they have yet to. He also believes that “there is no harm” in trying to win more funding through them. “We have plenty of resources for start-ups today, not only in terms of money, but also through the people who are willing to share their knowledge.” 

2. Find the right partner

After 30 years of working with his brother, Bobby has found that partnerships are a big contributor towards a business’s success, where the pros such as the strategic coordination of skills outweigh the cons. He has also observed that, in many tech start-ups, sole owners with technical knowledge or business acumen typically employ third-party providers in a supporting role, but in some cases end up losing control of their business after some time. “Once the soul of the business is placed into an outsider’s hands, the owner tends to become passive.” To avoid this, Bobby believes that it helps to make the technical support provider a significant partner. “Although this depends on the nature of your business, the most important outcome is that you have control at the end of the day. Also, get partners involved, as they tend to be more serious about the business if they own shares or equities in your company.”

3. Focus on core competencies

In the path to success, Bobby stresses on the importance of finding one’s value and sticking with it. “Know the advantages of your product or service and focus on them to optimise gains, rather than get side-tracked.” To hone in on a core competency, Bobby suggests starting up in an existing market or the ‘Red Ocean’, instead of carving out a new one, the ‘Blue Ocean’, because he believes survival instincts are crucial for a young company. “In existing markets, you can still make a profit without lowering prices. Even if you find your ‘Blue Ocean’, it might be difficult to maximise gains with your existing scale and capital.” Only when the company has achieved operational stability should its owner start thinking about transformation. “Find existing gaps by doing in-depth interviews and get involved in innovative projects every few years – just as I am doing now.”

4. Network, network, network

For the first five years of his business, Bobby shares that he spent the most effort in expanding his network, for he knew its importance in solutions-finding and research. He advises fresh graduates armed only with textbook theories on operating a business to actively join youth or industry-related organisations to gain the real-life, practical experience needed. “You’ll meet people willing to share about their businesses failures and tell you exactly what you need to hear when you’re wrong.”

5. Conduct in-depth interviews with strangers

“The most fruitful insights often come from complete strangers, because people you know typically share thoughts similar to yours,” Bobby says. “Talk to different people in different age groups and from different backgrounds, so they can give you honest feedback.”

Think big, start small – survive then transform

Amid the pandemic and Hong Kong’s ever-changing relationship with the world, it comes as no surprise that, more than ever, people are thinking twice about starting a business – but Bobby’s recommendation is to ‘just go for it’. “Risks were here in the past 30 years and will continue to be in the next 30. Although financing may be slightly more challenging amid the uncertainties of today, you’ll mostly be relying on your own strengths – not external factors. Think big but start small – survive then transform. Earn that first pot of gold first.” He also encourages young people to be brave in exploring opportunities outside Hong Kong, including the Greater Bay Area, Asia, and beyond, to leverage the advantages of different places and find their value there.

CityU supports budding tech-preneurs who are eager to take the next step in their business ventures through its flagship entrepreneurship programme, HK Tech 300. Gain the valuable opportunity you need to bring your ideas and innovations one step closer to success!

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