Saturday, December 17, 2011

Show Me The Money

I know so many people who want to put-up their own business but are afraid to push through because of lack of capital. They tell me that putting-up a business would be easy if they had the money. Once they have the money, they can quit their jobs and then focus on the business to make it grow.

But nothing can farther from the truth. Most great entrepreneurs I know didn't stop when they faced little to no capital at all. In most cases, the lack of capital can be the source of inspiration to make a business flourish and succeeds as it forces you to think differently and act quickly.
Thanks to

Let me cite a couple of examples...

Every Filipino knows Lucio Tan. He was the richest Filipino for quite some time before a mall magnate, Henry Sy, overtook him. He is a controversial but very successful tycoon.

His family was originally from Fujian province in China before they emigrated in the Philippines. They settled in Naga, a town about 350 kilometers south of Manila. As most Chinese emigrants, they almost had no wealth  to begin with. He worked while studying Chemistry at the Far Eastern University.

After his college years, he immediately set-up his own business dealing with scrap materials. Yet he also had time to work in a cigarette factory. Learning from his experience from the factory, he put-up the Fortune Tobacco company. The company hit it big! Most Filipinos I knew during the early part of the 1980's smoked cigarettes his company made; even my dad smoked 'Hope'!

He is currently in the Forbes list of the Top Five richest Filipinos. Aside from Fortune Tobacco, he also owns these companies: Allied Bank, Asia Brewery, Philippine Airlines, Philippine National Bank and Eton Centris among others. Not bad for a boy who started with very little dealing with scrap.

Another example is John Gokongwei, the chair of JG Summit Holdings. Although he had come from one of the affluent families in the Visayas, their wealth was all wiped out during and after the Second World War. They owned a movie theater.

However, war broke out and they lost every thing they had. John Gokongwei became the breadwinner and he was forced to sell food at the market competed with people much older than him. After getting enough capital, he bought himself a bike to be able to go in to buy-and-sell. He would sell candles, soaps and other things that far flung communities need.

He then went to Manila to sell tires and other wares. I recommend reading his biography, John Gokongwei, Jr - The Path of Entrepreneurship.

These two examples serve as a reminder that you don't need to have lots of money to start a business. You can start out small and work your way from there. Here is an interesting article from Yahoo!

Furthermore, if you want to start your own business you must stake your own money. I do not advise to fund your business exclusively from the money your friends and family invested. You must also be prepared to lose money as well. This will force you to work your butt off.

But some of you might say that money is a problem, that you don't have enough even for your self. Then that is an attitude problem. If you know how to sell and you are not shy about selling something, you will have money. My partner is doing that.

If you are an expert in your field, you can be a consultant and earn enough money to then expand your consultancy services or put-up that dream business. If you can think, speak and write you already have an advantage over people who can not do these things. It is up to you how you will use them.

Lastly, to ensure GreenRides success, my partner and I are not getting any salaries yet. We only get gasoline allowance to go to our meetings and visit our shops. Most of the money is reserved to expand GreenRides. As I have said above, my partner is still selling. She designs her own clothes and sells them over the Internet. I do have another job. I write and am still a member of Professional Speakers Association of the Philippines.

Just remember that when you have your own business, it is all hard work at first. Laying down the foundations and making sure that the system runs seamlessly. And it may take years before you can see and experience the fruits of your labors. But it is worth it in the end.

Some lessons for today:

1. Be prepared to use your own money to set-up your business. Venture capitalists are good, investors are nice but you must have that extra drive to push you harder; using your own money simply does that.

2. Never leave your day job or have other sources of income. Having additional sources of income would prepare you for emergencies and other unexpected situation.

3. Never use the lack of funds as an excuse. Other successful people have had less yet became a success story. Read Abraham Lincoln's story or John Gokongwei, Jr.'s biography.