7 Things I Learned From Being A First-Time Entrepreneur
I was 21 years old when I had my first taste of "entrepreneurship"
There was a university sports carnival coming up (shout out to all my homies from UTP yo!). And knowing how our university climate was hot as hell, we predicted that the thirsty athletes would need drinks. Ice-cold ones.
Our business plan was simple. We’d buy a big tub, lots of ice, a couple of 24-can cartons — then set up shop at the sports complex.
And… our hypothesis was right. We fed the thirsty athletes and sold out in a few hours. I can still remember the moment when we finished selling everything. There we were, a bunch of proud, successful entrepreneurs.
The grand profit to be split among five of us? RM13.40.
A failed entrepreneur?
Now obviously my business sense wasn’t very good when I was younger.
Nowadays I read about all these "wonder" kids selling things when they’re 10 years old, and I get jealous. I feel bad:
“WTF was I doing when I was 10 years old?! I was 21 years old before I started selling anything, and our profit couldn’t even buy us two Happy Meals!”
You know how society idolises top entrepreneurs like Elon Musk and Tony Fernandes? Yeah, I’m on that bandwagon too — I really admire those guys and wish I could be just like them. But I’ve never felt I’m good at entrepreneurship.
Between our “lucrative” Sports Carnival Drinks business and now, I can’t remember the last time I sold a physical product. (Yeah, sometimes I get paid for writing, but that feels very different.)
I haven’t even sold anything secondhand before. I’m more comfortable giving stuff away.
But something changed recently. Believe it or not, I started planning a side hustle — which I predicted could make some good money. I placed an initial order of 200 units and imported them into the country in mid-November.
In mid-December — 4 weeks after I started selling — the products sold out.
I remember the same feeling of triumph from 12 years ago. Like the wind-in-your-hair, the top-of-the-mountain scene from a 90s Beyond-Peter Stuyvesant video.
The difference is, this time I made a sizable (~RM 18.5K) profit to be split between me and my partner. And I now have a public blog where I can share what I’ve learned.
Why am I telling you all this? Definitely not because I’m a great entrepreneur. This isn’t gonna contain some groundbreaking Harvard Business Review theories. In fact, it’ll all be common sense stuff — told from a noob (me) perspective.
But maybe somewhere out there, there’s a 34-year-old housewife who needs extra money for her baby. She wants to start selling things but she’s scared. And reading Tony Fernandes’ biography makes entrepreneurship sound so big and hard. Maybe what she needs right now is to hear from someone who’s just a small step ahead of her.
Well, I’ll try to help.
Below are seven lessons I’ve learned from being a scared first-time entrepreneur.
1. Do your market research
What’s the Number One reason we could sell everything within four weeks?
I put it down to right product at the right time. Before I got the idea to start selling, I was actually looking for the product myself. So I did some research.
And if you know the kiasu (always trying to get the best deal) me, you know that when I’m researching something — I usually go deeper than the average person. So I did a couple of things, including:
- Stalking Facebook/Telegram groups for sellers
- Going through a variety of websites (both local and international)
- Looking directly at the manufacturer’s website
Halfway through, I started to realise:
- Shit, it’s hard to get these things in Malaysia.
- There were hardly any Malaysian websites (or “Facebook stores”) selling them. If I remember correctly — when I started, there was just one Malaysian website.
- There were hardly any listings on online shopping websites like Lazada or Shopee. Even if there were, they were out of stock or very expensive.
- How did I know they were expensive? I compared the price to the manufacturer’s recommended price, Amazon and another Singaporean website. Big (like RM 100+) difference.
(Note: all the above are freely-available information that anyone with an Internet connection and a curious mind could quickly find out.)
Again, I’m not a great entrepreneur, but even to me — this smelt like an opportunity to make money. So I probed further…
Market research level 2
Here’s some further market research I did:
- Asked a friend (who’s a huge influencer in this market) for advice on selling these items.
- Spoke to several friends who I thought would be interested to buy.
- Looked at Facebook posts from a previous seller. I tracked the time between his initial “announcement” post, and any final posts showing he had already sold out.
- Looked deeper into stock availability at a couple of resellers — both local and foreign. I also contacted the manufacturer directly.
- Did some Google keyword research to find out how many Malaysians were searching for it.
And here’s what I found out:
- The products were being sold out worldwide. It wasn’t easy to get its stock anywhere. Even if I purchased a bulk order immediately, it would take one month for the manufacturer to deliver — not including shipping time.
- All the friends I spoke to were very positive about buying from me. I guess it helped that I was offering to sell them below the Malaysian market price.
- Anywhere between 100 – 1,000 Malaysians Google Search for the product every month. (In retrospect — this figure was awfully low.)
- Finally, based on his Facebook posts — I concluded the previous seller sold out his stock (200 units) within a couple of weeks.
In summary: huge demand; limited supply — especially if you want your item quickly; and competitor pricing that I was sure I could beat.
I thought to myself, “This could really work!”
Note: What I was doing was a primitive form of what Startup People call “Market Validation.” And yes, I know it’s not as easy as just searching for stuff online. It helps if you have some influence, and if you know people. Then again, I see no reason why someone who’s very motivated couldn’t do it too.
2. Believe in your product
What product was I selling, you might ask?
It’s something that most Bitcoin/crypto-enthusiasts will get at some point: a cryptocurrency hardware wallet.
(The purpose of this article isn’t to talk about cryptocurrencies, but if you’d like to learn more, check out these articles on Bitcoin & Cryptocurrency Wallets.)
Like I mentioned earlier, before I had any thoughts about making money, I was actually looking for one for my own use.
But me being me, I didn’t want just any hardware wallet. There are some really expensive ones, but I wanted one that was both cost-effective and high quality. So I had already been studying the different models for a while — before I decided on which one I wanted.
The exact model isn’t important to this article; I’m not even gonna mention it here. But what I want to emphasise is this: I fully believed in the product I was selling.
And if you’re a first-time entrepreneur, I think you need to believe in your product too. Why?
Because you can explain to people why out of all the products in the world, you chose yours — and why they should choose it too. Because your personal knowledge about the product will help you answer (and convince) any queries/doubts that your customers have. And because it makes you an honest businessperson.
Yeah, you’re doing it for money and making a profit. But they’re also getting a really good product. Win.
3. Have strong partners; define their roles
I had two extremely-important partners in this project, without whom — it would never have happened. One was an investor and one was a logistics partner.
My investor partner provided me with 50% of the initial capital. I needed it because even after all the positive market research — I was still cautious. I didn’t wanna dump all my savings into my first real venture. But since there were two of us — we could share the risk.
We agreed to split the profits equally. Even though I was gonna have to do a lot more work (coordinating supply chain, logistics and marketing) than him. But I offered equal profits, on the condition that I will have the final say in business decisions.
This isn’t because I’m power crazy. It’s just that when running a project, I like to have a simple decision-making process, with an ultimate decision maker.
Then your “startup” can make quick, effective decisions.
4. Play according to your strengths & weaknesses
My logistics partner was equally, if not more important. Why? Because I didn’t wanna deal with packaging, logistics and customer queries. I know that sounds snobbish, but as anyone doing sales would know — customer service is a lot of work.
Both my investor partner and I understood from Day 1 that we did not want to get involved in distribution. We had no time and it doesn’t play to our strengths.
His strength is having excess money to invest (like Bruce Wayne). And having enough faith to let me run the show.
On the other hand, my logistics partner has already been running a highly-successful online store for a couple of years. So I knew she would handle the back-end logistics well. Plus of course, I paid her a commission for every item that she delivered. Win-win.
My strength? I think it’s bringing different people with different strengths together for a good cause, plus having some crypto + finance knowledge. That, and being a shameless voice on the Internet of course.
You’re never gonna be good (or rich) enough to do everything well. So find partners who will complement you.
5. Launch with faith, then learn as you go
The first week after we launched, sales were actually pretty slow. I think we sold four items. That got me worried.
So I started to think about how I could boost sales. I reached out to my partner for advice. I re-looked at how other people had been doing it on Facebook and continued to stalk competitors.
Along the way, I even had to learn how to use Google AdWords and spent a couple of hundred bucks on Google ads.
P.S.: If you’re setting up Google Adwords for the first time, you get RM150 of ads (free), when you spend your first RM50.
In the end, people eventually found our products and sales started coming in. Towards the end, they were coming in so rapidly, that my partner even had to source for additional stock to fulfil all the orders.
I learned a couple of cool, but surprising things. Like:
- Malaysians love to Private Message on Facebook — even though your ad clearly says you’re very slow at replying PMs.
- People still love to ask for Cash on Delivery — even though we offered free shipping. I suspect this is because the products are tech-related and not cheap (~RM 380).
- Lazada was my major source of sales. It’s pretty cool how Lazada-listed products show up on Google searches directly — without you having to pay anything extra.
- I had severely underestimated demand. The world is crazy about cryptocurrencies right now. And it’s about to get crazier.
Startup people would say that I had a successful “pilot program.” And that I would need to “iterate” and “scale” based on my initial findings.
I like to put it in simple language: Most of the learning comes after you’ve launched. Don’t let your “business” live in the fantasy-land known as your head for long. Instead, see what happens in the real world and learn from it.
6. Everything changes
When we first launched, I knew we were the cheapest resellers in Malaysia.
I honestly believed the other guys were selling it for way too much. I wanted to make this accessible to more Malaysians, so I tried to set a price that was still a good profit — but a little closer to what Europeans or Singaporeans would pay for.
But a few weeks in, our competitors started to adapt. I saw them dropping their prices to beat ours (good for the consumer, yay!), so we dropped our price too. (Now that we’ve sold out, they’ve raised the prices back up though. )
Next, I discovered that the manufacturer was starting to ship items directly to consumers, and stopping bulk orders. (A bulk order is when a reseller buys a big quantity from the manufacturer in exchange for a nice discount.)
I felt this was quite unfair to resellers who had already invested in stock; because now not only do you have to compete with other resellers — you have to compete with the manufacturer too.
But they’re the manufacturer. I guess they can do whatever they want.
The final twist
There’s a final twist to the story… in between the time I first placed the order and our product launch — I decided to accept an offer to work for a crypto-related startup. This is a full-time position starting mid-January 2018.
It was an opportunity of a lifetime for me and I grabbed it. But I also discovered selling hardware wallets is a potential conflict of interest.
So my future boss asked me to exit the business by mid-January. With my stock arriving in mid-November (plus all the other changes), I knew I had only about eight weeks to sell everything. Thankfully, we managed to pull it off in about four. But it was a scramble.
My point is, we live in an unstable world that constantly changes.
You’re never gonna be able to prepare for everything. Don’t be overly attached to your plans, ideas or decisions. Plan your best; plan for contingencies; and then execute. But be prepared to adapt.
And then shit will still happen. But if you’re already expecting it to — maybe you can make something good out of it.
7. It's never too late/early to start
The day we sold the last of our stocks, I was talking to my partner.
"Here we were, 33 years old — having our “first” taste of entrepreneurship. We both laughed at how “late” we were."
We had been talking about starting a side business for at least eight years already. But never launched because we were so kiasi (Hokkien slang for “overly timid”).
Looking through rose-tinted glasses now though, I think this was actually the right time for us to start. For our personalities. But it could be different for someone else.
When you’re young, you may have no money — but you have lots of energy, no ego/reputation to protect, and the unburdened optimism of youth.
When you’re older, you may be more scared of failure — but you’re wiser, financially more stable, and have influential friends.
Wherever you are in life, you have advantages. Use them.
Today, I look back at where my “drink entrepreneur” uni friends are. All of us graduated with engineering degrees at 23 and started working. Happy to say that we all figured out how to make money.
Whether by doing well at our day jobs, buying properties and renting them out, or investing in the stock market. As for me, I finally learned how to sell products online too; at the grand young age of 33 years old.
And if someone like me — who’s spent most of his life not daring to be an entrepreneur can learn to — then maybe you can too.
This story was taken from an article that first appeared on mr-stingy.com and is the personal opinion of the writer.
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