By Yasmin Ramlan
One of the biggest mistakes young start-up entrepreneurs often make is to fall in love with their own products. The second is to seek the opinion of friends and families, says Nazrin Hassan, Group Chief Executive Officer of Cradle Fund Sdn Bhd.
“Don’t ask someone close to you – friends and family – about your products because they will all say nice things to you and morally support you,” says Nazrin. “Go and ask strangers about your business model.” Their objective assessment will help your start-up to function better in the target market.
“Your function as an entrepreneur is to keep on looking for the thing that will work for your business. If you fall in love with your product, then you’ll just continue doing something that is not beneficial,” says Nazrin.
Cradle Fund Sdn Bhd is an agency under the Ministry of Finance, which manages an investment programme of RM150 million. It offers different types of grants up to RM500,000 to enterprises in the science and tech fields.
Does your start-up qualify for funding?
The Cradle Fund selection process is arduous and applicants need to fulfil three criteria when they pitch their business ideas, says Nazrin.
“There are three aspects we look at. First, we will look at the business model of a start-up, then the value proposition. What’s the pinpoint that they’re trying to address and how are they going to make money out of it?
“Second is the complementary strength of the team members and whether they have the strength to execute a particular idea.
“And thirdly is whether they are able to raise further funding or investments or their prospects of commercialisation,” says Nazrin.
Having led Cradle for nearly a decade and evaluating thousands of proposals, Nazrin has this to say: There is a distinct lack of original ideas.
Most of the ideas that he comes across are almost alike. Nazrin says Cradle would love to see a hard-core technology or research and development-based ideas, which no one is working on.
Instead, local start-ups are almost always consumer- and business-driven that will likely to disrupt the current market and its built-in inefficiencies.
“The perfect examples are all these ride-sharing businesses. Uber and Grabcar have completely disrupted the taxi model because it is something that was waiting to be revamped for a long time. It doesn’t work and it didn’t work, and many consumers suffered because of its poor service.
“Today, who’d imagine that everyone could have their own drivers? In the old days, only the rich could afford a driver. But now, everybody can have a driver daily and ride in luxury cars – you just need to pay more.”
Nazrin, however, takes comfort in local entrepreneurs who are taking a creative approach in solving the inefficiencies they have encountered.
As a developing country, there are plenty of inefficiencies everywhere and all the country needs is to tap into the entrepreneurs finding solutions to the problems and who are ready to market their ideas.
Nazrin’s Top Tips For Success
Validate your ideas
“You can always refer to someone who has established his business and seek his opinion on your product idea. Dare to approach and seek expertise.”
Attend mentorship programme
“At Cradle, we have a Coach & Grow Programme. You will go through a system of mentorship where your mentor will tell you whether your idea is going to work or not. They will advise you on what to improve and coach future entrepreneurs to pre-commercialise the product in the correct way.”
It’s not just about pitching your idea; it’s a thinking process
“Most people get it wrong that pitching is about you telling a story. It’s totally wrong. Pitching teaches you to convey a message to us (Cradle), where you have already narrowed down the real value proposition of your business. If you can’t explain it in about five minutes that means you haven’t refined your thinking of what is the exact value proposition that differentiates you from the rest.”
Your business plan is your thinking tool
“You don’t present your business plan to please funders. It’s your thinking tool and it helps you to develop your business. If you treat it like a thinking tool, then you will evolve but if you treat it like a document to please the funders, then they will blow you off.”