History unlikely to repeat itself
By Sharmila Ganapathy-Wallace March 23, 2017
- Many of today’s companies have real revenues and customers; are solving real problems
- Investors of today are a lot smarter and entrepreneurs are very responsible
WITH the current global economic conditions weakening and resulting uncertainties looming in the horizon, it is only natural that the business community is concerned that technology companies may go bust.
A member of the audience at the Global Transformation Forum 2017 floated this possibility to the panel speakers of ‘Transforming The Future of Business’, asking them if there would be another wall of money collapsing, as with the dot com bust of the early 21st century.
Catcha Group co-founder and chief executive officer Patrick Grove (pic, above) addressed this question head on. “The first tech wave was in 2000, a lot of people raised money with blue sky investing and 99% of companies didn’t last. A lot of companies today have real customers and real revenues,” he says, citing one of his companies iflix as an example.
“When they raise large amounts of money, a lot of companies do have revenue and are solving real problems. Investors today are a lot smarter as well,” he adds.
Grab founder and CEO Anthony Tan raised the issue of ethics and technology companies, in response to the question.
“We are not here to be like the dotcom companies. We are responsible as entrepreneurs, we have so much data and the power that comes with it. We hope investors will look at entrepreneurs and not just push us in the wrong direction ethically,” he says, commenting on how some investors push companies to use people’s data to drive business, thus violating ethics.
Khazanah Nasional Bhd managing director Azman Mokhtar (pic, above) notes that this time around, things are real.
“It is tough for investors to invest and even tougher for them to divest,” he says, adding that the number of unicorns outside of the Silicon Valley is increasingly in Southeast Asia.
Earlier, during the panel session, the speakers were asked what their thoughts are on the future of business in their respective disciplines. Grab’s Tan (pic, below) says he sees Grab continuously driving a lot of real-world solutions.
“One problem was solving the safety issue in this part of the world. We’ve partnered World Bank on an open traffic platform- to help flow traffic. We’re providing finance loans to people to finance their own cars, motorbikes. I see a lot more lending in Malaysia and self-driving vehicles,” he says, adding that he believes that artificial intelligence and transport will be complementary.
Khazanah’s Azman notes that in many respects, we are already seeing the future, via technology and disruption.
“Deeper than technology is society itself, there’s transparency everywhere, there’s no place to hide. In the old days, the business of business is business. Society is asking more of businesses, governments, and media. Businesses have to serve society, and make money as well.”
Catcha’s Grove gives an example of an iflix survey to illustrate his point about the future of business.
“iflix did a survey of 1,000 users across Southeast Asia. 85% said they’d rather be on an island with a mobile phone, rather than their significant other. The next five to ten years is the mobile revolution, we’re really focused on the mobile as a centre of gravity. We know have to be Internet focused and we believe that Silicon Valley does not have monopoly of great ideas.
“We really believe there are multiple opportunities for regional entrepreneurs. They have got to be mobile focused and regional entrepreneurs are building solutions to problems. What we do in emerging markets is important, we see more great companies and entrepreneurs being built in this region.”
What the future holds
On opportunities that the future will bring, Grove replies: “I believe that every industry in the world has the opportunity to be disruptive via digital. Twenty years from now, more than 50% of total value of economic creation will be attributable to digital companies. Every sector has the opportunity to be digitised.”
“We see a world where Malaysian companies can challenge the world. People keep talking about data, everyone is collecting data but what are you doing with that data? How many PhD guys do you have on board (to work with) data? The next five to 10 years, I see universities pumping out data scientists and they will be more valuable than all the bankers here.”
Of Grab, he says that over the next two months, they will have over a million people working with Grab. The bottom line for them, he says, is how to work with governments and how to alleviate poverty, create value. “I tell my drivers who are scared of robots, AI, that no robots can provide the same kind of service as humans,” he says.
Khazanah’s Azman highlights that AI is happening in every industry. “We have investments in a visual search engine by a UK-based company, which is drilling down into AI. We also invest in many companies that are old economy. All the old economy companies need to work with younger companies,” he opines.
Commenting on challenges to come for the future, Grove says that if anyone is an entrepreneur, challenges are everywhere. “It’s about changing the mindset to deal with challenges—go with a positive attitude.” He adds that a challenge for entrepreneurs is that it is really hard to find talent, to build that mindset to do things differently and that it is ok to do that.
His advice to entrepreneurs and leaders of the future? “Persevere -- no one knows the exact steps. Keep moving forward and cherish your mistakes. Focus on the end game. Every industry will become digital in the future. Don’t look for the sexy sector, look for what you’re passionate about and focus on how you’re going to digitise it.”
Grab’s Tan opines: “Make sure that you push so hard, that you break the boundaries. Push your talent hard, until they break and know what they are capable of.”