Positive thinking and a lot of passion are obviously important in starting a business.
But a startup is not all about the excitement of plunging into an unknown future and changing the world. One has to be prepared for the worst, too.
Elliot Leung, a 27-year-old designer of an app that facilitates the sharing of household items among neighbors, wants to remind young entrepreneurs of the need to prepare for the possibility of “total loss” when they chase their dreams.
“Ninety percent of startups end up in failure,” Leung told RTHK. “You also have to accept that in the first two years, you might have to invest every dollar of revenue back into the business and you have to live on a very tight budget.”
In the worst-case scenario, “you could lose everything, including startup capital you probably borrowed from your parents, and two to three years of your youth”, he said.
Leung was a student in Canada when he became fascinated with the increasingly popular Western concept of collaborative economy.
Hoping to promote this sustainable lifestyle, he collaborated with a bunch of friends to create an app that allows people to borrow and lend things through the smartphone, enabling people to enjoy more without having to spend money to buy them.
If there are two members and each has 10 books, together they can enjoy 20 books through this platform, Leung explained.
Scale this up and it could be a powerful model. Leung’s app lets people list anything from DVDs to golf clubs.
“And you can also meet lots of new friends through this process,” he added.
Leung has tried out the idea in the building where he lives. So far he has gathered about 300 users and 1,000 items.
“Spend less but live big” is how Leung sums up the app’s merits.
While the operation still looks tiny at the moment, Leung remains committed. “I want the app to become part of people’s lives.”
While he is hopeful about the future, he is also fully aware of the downside—his company may not survive.
Hongkongers are not quite used to the concept of sharing things with strangers, even though that means putting their idle resources to better use and saving money.
But Leung believes what characterizes startups is the vision and boldness to introduce new products and services.
Leung said he wants to do this while he is still young and single, and the opportunity cost is low.
“If I am 35 and I want to try this, my wife might just walk away.”
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