Trappings of a successful startup entrepreneur

Sam Potolicchio, director of Global and Custom Education at McCourt School of Public Policy at Georgetown University

92 per cent of the Vietnamese youth consider starting a business a desirable career opportunity. How would you assess the Vietnamese youth’s readiness for entrepreneurship?

92 per cent is an amazing show of entrepreneur spirit and I believe much of this can be traced back to the young population – and all these young people carry with themselves the dynamism, flexibility, and daring that is so important in setting up their own business.

This number also makes me think that young Vietnamese people are particularly bold and brave in their thinking. For many, opening a business seems like an insurmountable challenge: they see tasks to do, requirements to fulfil – and all the difficulties can sometimes overshadow the gains.

Vietnamese people, on the other hand, dare to leave their comfort zones and explore the wilds beyond to actively seek out challenges. What is more, from my experience of Vietnamese people, I feel they have the confidence to assert themselves whenever the opportunity arises.

On the other hand, when it comes to self-made leaders, young people must spend time to invest in themselves. This is doubly true in the case of young startup entrepreneurs who often deal in novelties or with highly technical products – and triply true in Industry 4.0. Falling a single step behind can mean death for new businesses and leaders need to be at the top of their game to prevent this.

The success rate of Vietnamese startups is not high in Vietnam. What do you think is the reason behind this?

True, the success rate is rather slim – but this is the general picture all across the world. People remember success stories, and failure rarely makes headlines – even though it is far more frequent. We forget that it is from these failures that most success stories are built on.

Startup entrepreneurs need to keep in mind that failure is a very real possibility that can happen to them, not only others. In fact, business is not a one-way, golden road paved with success: sooner or later, there will be bumps along the road – it might even be a dead-end, who knows?

The point is not only to stand up, dust yourself off, and keep going: you need to grow with every challenge, learn from every setback. Starting your own business is a test of willpower and determination, but is also about constant improvement.

There are many reasons why a new business goes bust, but the most fundamental causes are two-fold: a lack of business identity or a lack of business culture.

Corporate identity is reflected in the products and services you provide to customers. If the product does not find actual demand or it is not good enough to fill the hole, it is obviously destined for failure. Also, if the product is too faint to stand out from among the countless similar products on the market, it is inevitable that you will be eliminated.

Business culture is the way you approach customers. This is becoming increasingly important as consumers are turning towards all things fair-trade, organic or eco-friendly. We are reaching income levels where price is no longer paramount – and this is the trend in Vietnam too, as it is fast approaching the middle income bracket.

Customers will turn away if they realise the business is about profit and nothing else. You need to have a creed and take time to give back and grow with the community. What is more, thanks to the wider media coverage, customers can see behind the charters and codes of conduct and keep an eye on your real actions. Environmental pollution or the poor treatment of labourers, everything that makes you look like the cold, forged iron corporations of old will earn a backlash. Customers need a partner who puts them in the centre and is an organic part of their world.

Finance is the most important factor for the success of every business project, so what should startups do to lure in more investment?

Even before you begin to name your business, you need to conduct market research. You need to decide if there is real demand for your product, who would be using it, what for, and under what circumstances. This helps you decide whether your idea is marketable, whether the actual demand can produce the revenue and profit that would justify the existence of your startup.

Then, you need to make sure of the quality of your product or service. This necessitates some back-breaking legal research to make sure the product is compliant with local regulations. If you foresee a chance of distributing your product outside Vietnam – and this is certainly a consideration in Vietnam – it definitely would not hurt to have a look at the new-generation free trade agreements (FTAs) and provide for at least the option of making your product compliant with stricter regulations. It is also very important to give your product character, something to set it apart from competition. This can be a good name or an impactful marketing campaign, but design is usually the first choice. Make your product seen, make it jump off the shelf.

These things are important for your business to get off the ground, but if you plan to grow, you need more investment. Investors look at everything: the product, then your plans, strategies, and your performance.

Transparency helps a great deal: keeping clean books builds a great deal of confidence and makes you look far more serious and professional than slapdash accounting. So many good ideas failed to draw support because the startup concentrated only on the product and failed in keeping a clean house.

In Industry 4.0, which sectors are the most promising for startups?

In the 4.0 era, products not only cater to domestic needs, but also need to meet the demands of global consumers. Therefore, products must meet international standards as a prerequisite.

Vietnam has so many startups that offer online services, and the Internet makes these services available across the globe. It is imperative to comply with international laws and the regulations of the countries where you operate.

At the same time, Vietnam is beginning to export its culture. Tourism is obviously the first sector that comes to mind, but the country is also exporting its famous fruits in bigger volumes and I do not think it is an overstatement that pho is a worldwide phenomenon now.

This is why setting up a business dealing with traditional Vietnamese products is a rising option. However, here startups and entrepreneurs must make sure that the product carries the identity of the nation and country, while staying accessible to foreigners.

The 4.0 era also creates opportunities to try products that are not traditionally the strength of Vietnamese people. Entrepreneurs need to keep an open mind to reconcile old and new, tradition and modernity. They have a wonderful chance to integrate with the general flow of the world, but they need to retain their identity.

What qualities should a leader have and how has this changed since Industry 4.0?

Above all, an entrepreneur needs to be able to reach out to the big sea without being afraid of being swept away. They need to have a can-do attitude to begin, and then the discipline to continue.

You need to be able to accept new challenges and the changes that come with them. Much of modern business rides on innovation, so successful startups and entrepreneurs must change with the times. Listen to your team for new ideas and keep an eye on the community to identify new trends before they really take off.

Last but not least, a personal advice: it is the 4.0 era, and it may seem that everything in life has technology and social networking is key, but as a leader, you need to interact directly with all people. A close, personal touch is invaluable for every leader.