Mr. Lau Shih Hor, together with Mr. Jonathan Priddey found Elixir Technology in 1993, which before that they were in a same team in one of the government research institute in Singapore. Together they bootstrapped the company with their pocket money, went through several business models from training-consulting to now product development, having seen many ups and downs, before they finally made it this far.

Company: ELIXIR TECHNOLOGY PTE LTD Address: 50 Armenian Street # 04-04 Wilmer Place Website: http://www.elixirtech.com Interview with Mr. Lau Shih Hor And Mr. Jonathan Priddey by Sophie Alimin on 02-Jun-2008. Student can be reached at sophie_alimin@hotmail.com   Business Profile: Elixir Technology provides Integrated Business Intelligence which is headquartered in Singapore with an R&D arm in UK. It has a mission to enable more customers to become intelligent enterprises to compete in a fast changing world and a vision to be a global leader in business intelligence tools and practices, providing pragmatic, adaptive, and cost effective solutions.   Interviewer's Comments: Mr. Lau Shih Hor is very passionate of what he is doing now although he wouldn't recommend to others the difficult way he started. While there is much one can grow from going through difficulties, it is better to learn from past lessons and adapt to the fast changing trends.   1. What is the nature of your business? We are in software business to be exact is the enterprise software of business intelligence. It is geared towards companies and not the individual consumers. The idea is how you make sense out of the information that you have in your company. They keep information like the sales result, the expenditure or the customers' information. Sometime you want to step back and look at the trend to see which aspect is generating more revenue or maybe less revenue but more profit, which customer segment you want to target.. This is where Business Intelligence allows you to extract the information and present it in the way that different people of level can understand and make decision.   2. When and why did you decide to become an entrepreneur / take over your family business? NOTE: If it is not a family business, ask: Do your parents have their own businesses too? Have they inspired you in one way or another? (Select appropriate question according to the entrepreneur being interviewed.) The company was set up in1993. Back then it was quite unusual and seldom people do that. I came from the research institute in Singapore part of the government that was early days when they promote this kind of entrepreneurship, but all of us were very new at it. So we did it purely because we thought it was interesting. It was the somewhat naive optimism that did it.   3. What are your reasons for choosing to do business in this particular industry? In fact when we first started up, we didn't choose this field. Since we were researchers, we chose what we were good at doing. So Jonathan and I who were in the same team did a product which was more technical. Instead of targeting business, we were targeting programmers just like us. It turned out that, what we were really good at didn't really have the marked potential. It took us a while about 5 or 6 years, plus 5 years before that, before we finally decide that we had enough. It was quite a long effort. We finally switched to this area of Business Intelligence. In the way it is quite technical because behind the scene, we still had to put all data logic together and how to transform this and that. But what we are doing now is we take the same technology that we are already quite familiar with and we channel it towards our target which more on business people who are probably more willing to pay for the technology. It came out with a project that we were working on and they needed this kind of tool. So instead of having to do a lot of programming, we make it easier to people so they don't need to do the programming. We do the hard work underneath and they can just piece together what they want to see.   4. How did you put together all the resources needed to start your business? For example: getting the start-up capital, hiring staff, doing sales and marketing, advertising, etc. People called it 'bootstrapping', where we started out with just a pocket money, and keep rolling back in our earning to grow the business. We had very good customers at early stage who were willing to pay money upfront. We didn't get any external money. Previously, there were also not many people bet on two or three of us. They were afraid that we didn't know what we were doing and we were still young. In software, there is little hard asset for them to hold as collateral. So that is why it's not easy to get some kind of external funding.   5. What are some interesting stories you have about your first few customers/first few years in business? We had three major customers at the start who believed in what we were doing. They ordered our services and product that we were doing. When we first launched this product to companies, it is important to secure key customers, but the first challenge came after 9 months. The customers couldn't keep feeding you. You needed to grow and did different things. We were going through this very dry period which was when we learnt the hard lesson. Since we were researcher, we thought that if we put our best in the world, everybody would come. But in reality, it is not like that. We didn't invest enough in sales and marketing. After the first round our customer kind of like spent enough in this first round. That was when reality kicked in.   6. Is setting up this IT company your childhood dream? Well, back then IT wasn't even around! But if you ask me whether I enjoy what I am doing now, I will say yes, I enjoy it very much. I am glad when I make the move. In the R&D environment under government, I had a very stable job. In some ways, it was also quite interesting. We could try some different technologies whatever latest in the world; we attended conferences in other countries. I think the biggest difference I find is that now I can see the value of what I am doing. It is not that R&D has no value, but it is difficult to see that what impact that we have done and created can bring. It can take years or sometime what we produced doesn't even get to see the light of day. In our case, anything we do has the immediate feed back. When it is good, we can see customers taking it up and if it is bad, we can get some comments from people. The chance to create something out of nothing, which is what software, is all about, and with the value inside there, every dollar people pays is like compliment. That kind of satisfaction I really treasure.   7. What are some of the challenges you faced when you first went into business? There are too many challenges. In fact if I may start over again, I won't do the way we did it at first. After the first 9 months it is quite terrible which we suddenly didn't have business and we had to learn from scratch again how to build relationship with more customers. That was of the immediate challenge. After we got over it, the next challenge we had was getting and retaining good people. Because we were a small company and not well funded, there were few reasons why people wanted to join you, other then few who really admired what we were doing. Most people look more for the money and the career growth. We had a few good people who stayed with us. Some of them are still here, but many of them have to go because of more financial commitments. Some even shed some tears when they need to leave because they still want to be with us and fulfill what we want to achieve. The field we are in, which is the business intelligence is relevant to almost all company all over the world. So our competitors are very big companies. When we first entered the market in 1999, the competitor did about hundred million dollars in range. For few years later on, there was some merger acquisition were going on, and they became a billion dollars company. Last year, even this billion dollars company gets acquired by even bigger company. So now we are competing with the top few players in software world. If I went back to where I started of why I wanted to set up this business was because I saw the value. Now it means even more that even someone buy our product not from those of big players, it definitely show the value of our product. So I think that the challenge is getting even more exciting.   8. How did you manage to compete against those big players? I will spare you the technical details of how we compete against them. There are many ways. One thing we learn is not to go head on too much. Sometimes we can't avoid. The strategy is to dance around the big 'elephant', without getting yourself stomped by them. The ability to create a niche market or different approach to the whole thing. I believe there ways to compete against them. If look at the whole of Asia market of how several companies compete against big companies. For example in the car industry or electrical appliance industry, of course when it first started up, it was the Western that dominated the market. The Japanese car in their early stage, where everybody always joked about them if you scratched the Toyota, you would see Coca Cola because they were made of recycled Coca Cola cans. It was minimal quality at low price. But today, top model like Lexus come from Toyota. In fact that over time, they have improved, developed the niche market and eventually they become the top player. Now we can see different generation where Japanese is the first generation then Korean comes next. Korean car are now more reliable, which was not few years ago. So it doesn't mean that if there is a big player there, nothing will ever change. It depends on the innovation and value adding at the same time to make the difference.   9. How did you overcome these challenges? Please share some specific examples of the action you took to overcome the challenges. We learn how to make ourselves more attractive. Big company has its attraction, but a small company also has attraction but we must know how to enhance that. We had people who would like to join us, we have people from big company that switch over, and a lot of it is the environment that needs a lot of creativity and a lot of trial and error. It will attract good talent to join us. Another part of challenge is how to discern in getting good people. We make sure that they can blend in, the right match with our company. That is what we learn over time of how to hire good people, how to interact with them through email, MSN, and phone call, before I get to see them. Because a lot of communication these days are done remotely. If you are not good at doing that, you don't even have chance to see your customer. We can try to interact through email, to see whether your customer even want to see us. Especially for sales and marketing people, that ability to build rapport remotely is very critical. If we are hiring very technical people, we know from the resume, people can be really creative to write it. It is really getting them to try out the actual work, so we normally give them programming exercises. It is not like a pop quiz,, but we let them to take their time to do reference, research and show us what they do. Then during the interview, base in the email we tell to explain how they did it, what challenges they faced. So that we can know the whole thinking process of problem solving process. It gives advantages for both sides because we can know whether they are suitable and they can get the feel of job nature and whether they want to do this thing for 80% of my time. I don't want people to switch job and three months later have to find another job. We take a longer time these days to interview people, and to try out whether they are a very suitable candidate. If they are we will definitely welcome them in and we will have enjoyable working environment.   10. Can you remember your worst day in business or a time when you felt like giving up? What happened that made you feel that way and how did you triumph over it? In term of retaining people, there was one time when an important person decided to leave. So I thought that oh no, this product wouldn't be able to go out to market. We had to do a very serious reshuffling of our internal resources and the good news was we did go through and even better, the person who left was still helping us when was in the other company. He still keeps in touch with us. It was a nightmarish moment, and now it turn out to be better. It could even our blessing in disguise, because as there is one less key person, we decide to focus on more. There other worst day was maybe the early days of the 9 months dry period. I remembered there was one day when my co-founder said to me that that day was his worst day in his life. He said this was the only day, when he walked to the book store and saw the book he wanted to buy but he found out that he didn't have the money to buy. I felt very bad for him. As I handled the sales side and he was CTO who focused on technology side, I remembered that I promised myself to make sure that he could get enough money to get the books that he wanted and resources that he needed in his work. My worst day was when I was in the parking lot ; I needed to buy something but didn't have cash. Literally, I had to take out my parking coupon and ask someone else if they want to buy the coupons.   11. When was the moment you realised the business would work and support you? In the long term viability, the core team of the company is very important. From R&D it is a pitfall when we have very strong technical people but we don't have sales and marketing people. We also needed other key personnel to spearhead important functions of the company. For years of searching, we finally got a very good team in place. They are the pillars of the company, the foundation of our growth and sustainability. As long as the foundation is there, the fundamental is there, I believe that this business will be viable.   12. What are some of your proudest business achievements to date? And why are they so important and meaningful to you? We got four awards last year. The most recent one was the Deloitte Technology Fast 500 award. It is for Asia Pacific top 500 company measured by the rate of growth over the last three years. We came out to be top in Singapore, while in Asia Pacific we were in the middle of top 500. The result we achieved is not just for one or two people, but it is for the whole team that worked together and delivered that kind of result. This is my proudest moment so far.   13. How do you differentiate your business from your competitors? Please provide specific examples. We differentiate in the way of our integrated product. For example years ago, when people used Office software, it wasn't in a single package such as Word Star as one piece, Lotus 1-2-3 in another piece and other pieces. It changed when the Microsoft came in. Although they had separate product of Word, Excel and PowerPoint, what really change the rule of game was the come out of integrated product as the Office. The rest quickly followed suit, but none of them were as well-designed as Microsoft. Although the individual Microsoft products were not the top of every category, they dominated the market. So we are doing the same thing. In this business intelligence market,, there are some product which are very strong in one area and another in other area. Although the various products can be string together, the underlying architecture is still quite messy and is different from the product that is designed to be fully integrated. We spend close to 5 years now, in ongoing development of this integrated product. It is like building a house which contains of layer to layer of foundation not like a Lego blocks pieced together. The benefits may not be immediately obvious to some people because people compare for big names or which one has the more features. But as they use, they start to realize that although our product may only cover 80% of others features but these are the features that they really need. The rest are just additional. So then they might realize that this is a much better approach to business intelligence market. From the price competitiveness point of view, we provide more savings to our customers. In the midst of economic uncertainty, there are people who questioned why you want to spend for brand when you can get similar product that can provide at the same value at a cheaper price which attract more customers. Again, you can think about how Japanese car become world car, it was started up somewhere. In the other aspect like the licensing model which there are different ways to charge the licenses. There is a big ongoing turmoil which on the one hand you have expensive commercial licenses where you have to pay for every named user. On the other extreme there is a open source which everything is free. Usually you only pay when you need the services. We don't go all the way to open source because we think the service market especially Asia pacific is not that big. We are somewhere in between where we go for mainly server type of licenses. That is also getting a lot of attraction especially those who have many users fronting that kind of situation especially in doing the internet application. We make use of a lot open source product which cut our cost drastically, that is how we compete with the big boys. Last aspect of differentiation is we leverage a lot with our partner in different parts of the world. We have 5 languages for our software. We have German, Japanese, Taiwanese, Chinese and English version.   14. What kind of education does help you to shape your entrepreneurship? Different education system will cultivate different part of a person. Like there is an ongoing debate that Singapore style is studious and too focuses on the studies. I see benefits from there as people come from this kind of environment are more discipline and very focus on what they are doing. There are also people who graduated from overseas who are more relaxed, more exploratory and creative. The key thing is to keep an open mind as each system has its advantages.   15. What are some business ideas you have implemented that created great results in your business? My idea to create a great result in business is by having a good and compatible core team. The core team who you partner with makes or breaks the whole team. Choosing your team members or partner is not just for convenience between friends. Selecting the right people since the beginning is very important. In hiring good people, sometimes we can feel pressured as we regret after hiring the wrong people that seems good. One of our key people even waits for 3 months because he can't leave straight away to finish up their part, knowledge transfer, and so on. The sales and marketing side, especially the technopreneurs, who are good at technology side but overload the importance of sales and marketing. From understanding your strength and weaknesses, of course you want to enhance your strength. For example, from the internal side, how to attract people, how to create an environment which is very exciting to work in. Externally, how to create niche market. Today, we have 40 over government project in Singapore who are using our software. So majority of government agencies and health care organization have already used our software. The three local banks also use our software for the internet banking side. Our customers in the US are the media company like Walt Disney and recently national academy of television which is the Emmy award, while in Japan are Mitsubishi, Hitachi, Fujitsu and recently also in Thailand, Indonesia, Taiwan and Hong Kong. I think the ability to differentiate and capture the market are very important.   16. What do you see for your business in the next 5 years, and does it include any plans for expansion? Certainly the market is growing and we want to grow into other different country. First of all, we leverage our partner to get our product into market. From there we can access to potential market. We want to start new branches and operation in other countries but we want to be careful about its sustainability. We are also searching for external funding to fund the growth expansion, especially for the bigger overseas market like US, where the amount of resource needed is quite substantial. At the same time, if there are merger and acquisition opportunity by other company, we want to explore. Sometimes acquisition that people do is to close down a particular product or more for competition reason. I hope if we get acquire is because the potential in our product. We want to contribute in a new revenue stream in that company because in this business intelligence market, I believe there is a lot of potential.   17. What does entrepreneurship mean to you? Entrepreneurship is first, creating value; creating something out from nothing. Second, really bring it to the right person. Third, bring the money in so that you can start again from step one which is creating value out of nothing again.   18. What are some entrepreneurship qualities that you have which has helped you come this far? I think I have very strong belief in creating something out from nothing. That is probably my biggest strength, along with optimism. It is hard to be entrepreneur if you are pessimistic.   19. In your opinion, what other qualities does a person need in order to be successful in business? And why? (eg. Educational qualification, work experience, family influence, attitude, etc) You need to be optimistic and at the same time you must have a fundamental in your mind. Vision is only a dream until you act on it. Entrepreneur have the ability to make dreams happen, Sometime you have to pick the right one, as we have many dreams, aspirations. So I suggest entrepreneur out there including myself to always evaluate and see what to focus on but still have to keep your mind open for changes.   20. In your opinion, what does it mean to have the "spirit of enterprise"? Spirit of enterprise means that the spirit of believing that you can add and create value out of nothing or build on somebody else's values As you humbly and honestly work with your customers, you realize that you need to try new things and change this and that. Not just the great idea that you have, but being all the way to deliver the value and see whether people affirm that money they give to you. I think that is the spirit of enterprise.   21. Who or what motivates and inspires you? I can't say that there is a single person. What I really see is that it is more on the personal interest. If you don't enjoy doing IT things, don't come to the IT field. It is terrible in the sense that it keeps changing and what you are good now, on the next few years it make not much big difference as many people know about it already. We must learn to enjoy and keep trying new things. I like to see what things happen and provide the value. Delivering value to people keeps me going.   22. What are some of your business values and what would you like to pass down to others, particularly the younger generation? Especially when doing business in overseas, I aim to make friend first and then I make business. Generally speaking, a lot of people in Singapore focus on making business. How much is your product, what services can you give me, what is the negotiation, sign the deal and good bye. I think doing overseas is slightly different. People need to know whether they can trust you to deliver your product and rely on you when there is problem. That is why people go for brand as they see that brand means reliability. So being their genuine friend first is very important to show your sincerity. Many customers are almost like my family friend as we visit them. This kind of relationship is what I treasure a lot. I believe it is the foundation for the long term growth.   23. With the changes in the market today, do you think it has become harder or easier to succeed in business? Why do you say so? In IT, we should be prepared for the changes. The market we get me off guard which we realize that it changes so fast and it is so broad. On the other hand there are opportunities that you can find because new plain field will always emerge. We must learn to accept that certain aspect is gone forever. We sometimes reluctant to give up things that we are good at doing but once it changes it really can be gone. The core strength of company or people is still the same. We are still looking for people who have innovation and se it all the way. That fundamental doesn't change, but how you apply it always changes. From years of experiences, we think that we need to leverage more on changes than to amend those things that will never happen again in the future.   24. What advice would you give young people who want to start their own business? The business environment is quite challenging. It is important to do self evaluation. Do we have the substance to really challenge the world market? You can say that you just want to conquer local market and that is ok as enterprising doesn't mean that you must reach overseas. The key thing is to evaluate what you are really good at and in what extend that you can create and work on this value. All of this is not a one man job, so find your team that can complement your strength or the weakness that you have. So that as a team you have a broader base which you can grow from there.