Entrepreneur coaching not just for young startups: Proficeo
By Goh Thean Eu April 23, 2015
- CGP3 aiming for 80% of participants from growth and global stage companies
- To accept only 100 this year, down from 125 in CGP2
This is why Proficeo, the programme manager for Cradle Fund Sdn Bhd’s Coach and Grow Programme (CGP), hopes that the next intake will include greater participation from companies in the ‘growth and global’ stages.
The programme, now in its third outing as CGP3, is a technology entrepreneur-training programme targeting pre-seed, growth stage and global companies.
In a conversation with Digital News Asia (DNA) in Kuala Lumpur, Proficeo chief executive officer Renuka Sena said she is hoping that CGP3 will have 80% of its participants from the latter stages, higher than the 60% participation rate in CGP1 and 2.
She said that by focusing more on growth and global stage companies, CGP would be able to better complement the other startup programmes that are currently going on in Malaysia.
“Today, there are so many programmes for startups. However, what happens after these startups ‘graduate’? There seems to be a perception that once a startup secures its first customer, or launches its product, it is miraculously expected to know how to run a business,” Renuka said.
“Currently, there are no programmes that focus on coaching companies in the growth and global stages.
“I think this is very critical because it ensures that the money that has been spent by the company or the Government to get them off the ground [in the early days] does not go completely to waste,” she added.
‘Ceiling of Stagnation’
But why would a company which has survived 10 years of challenges still need coaching?
“Companies that have been established for several years, even with a global presence, may face what is called the ‘Ceiling of Stagnation,’ where its revenue or profit growth becomes flattish,” said Renuka (pic).
In fact, one of the participants in CGP, a software company which had been established for about 10 years, faced such a situation, she said.
“So we advised the company to apply a subscription model instead of one-off sales. We also advised the company in other areas, and as a result, its revenue jumped 169% during the year,” she claimed.
Renuka said another company, which has operations in “numerous countries,” was having issues with its profit margins.
“So we looked at all its subsidiaries, to see which were performing and which were not. By having a better understanding of which markets were performing, the company could then put more of its focus and attention on penetrating and growing the markets,” she said.
While this may seem like ‘common sense’ decisions for companies anyway, Renuka said that these companies were so busy running their operations on a day-to-day basis that they may not have had the luxury to step back to look at the entire situation clearly.
And employees at these companies may not have dared question their bosses’ decisions, or lack of decision-making.
“This is also where coaches add value. They will ask you tough questions; [they will] question your business model and your decision in expanding to a particular market,” said Renuka.
“The rationale behind this is not so much about getting the right answers, but in creating the thought process.
“Sometimes, the participants, when answering such questions, realise that some of their decisions may not have been the most ideal,” she added.
CGP, which was first introduced in 2011, has evolved over the years. In its first edition, it focused on companies at the ideas stage all the way to those in the pre-initial public offering (IPO) stage.
CGP2 struck pre-IPO companies off the list – partly because it was felt that investment bankers and IPO-related consultants would be better able to provide guidance for such companies.
While the target audience for CGP2 and CGP3 are the same, Renuka said CGP3 has improved in terms of overall offerings, and now also includes mentoring by various industry veterans.
“We will also be having a mentor-resident type of programme, where we get different industry veterans every month to spend one day with participating companies. It will be on a ‘first come, first served’ basis for whichever companies want to spend time with the mentor,” said Renuka.
She admitted that the idea itself is not new, as it was introduced in previous CGPs. However, she said that previous mentoring programmes and sessions were run more of an ad hoc basis, organised whenever someone was free to provide a mentoring session.
“Now, it is more structured,” she said.
The 125 companies that took part in CGP2 managed to hit a total revenue of RM255.4 million (US$70.2 million) during the course of the programme, compared with RM198 million (US$54.4 million) with the 135 companies in CGP1.
CGP2 companies managed to raise RM38.9 million (US$10.7 million) in funding, from venture capitalists and angel investors, or via loans and grants.
“If I can recall correctly, more than half of the CGP2 companies managed to raise funds,” said Renuka.
However, CGP1 companies managed to raise RM179.3 million (US$49.3 million) in funding during the course of the programme.
When asked why there was a steep decline in funds raised between CGP1 and CGP2 companies, Renuka said the funding in CGP1 was mainly driven by companies which were in the pre-IPO stage.
Another measurement is an increase in employment. In terms of total headcount, CGP2 companies increased their headcount from 838 people at the beginning of the programme, to 1,574 people at the end.
The higher headcount is also a testament to the companies’ growth – they needed to hire to help drive and sustain that growth, according to Renuka.
CGP3 will only take in 100 companies, a decision in line with the programme’s aim to attract more growth and global stage companies.
“You end up spending more time with growth and global stage companies. If we want to focus more on that stage of growth, then we need fewer companies but more time,” said Renuka.
“We want to make sure the companies get the best we can give them,” she added.
The registration for the first intake of CGP3 is already open, and will close on April 30. The programme is expected to start sometime in June. For more information or to register, go here.
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