TimothyTiah.com

How I once again resisted the temptation to “fake it till you make it”

I’m constantly paranoid about how well Colony does as a business. Since we started we’ve been lucky, constantly beating targets. Every quarter that passes we break new occupancy, average prices, revenues and EBITDA records so things look like it’s doing very well but I’ve always told people internally and externally that some shit will happen eventually that will cause us to miss a quarter’s numbers.

That quarter is this quarter. How do I know even though we’re not even 1/3 through the quarter?

At Colony we set up these things called leading indicators that are meant to tell us in advance how our business is going to do in the next 2-3 months. The idea behind this is to see a problem before it happens and fix it before then. This has worked very well for many aspects of our business. There is one problem though where the leading indicators started showing cause for concern as far back as 6 months ago, but while I took some steps to solve it, I didn’t do what needed to be done.

The unfortunate thing about this problem is that the solution isn’t something that I could fix before the quarter ends. It’s something that will probably take 3 months to fix, so that’s how I know we’re going to miss our targets this quarter. To add to the problem, this last quarter of the year is especially important to us because we’ve been having talks with some parties on a really big fund raise next year. Missing targets in Q4 would make us look bad and may scare away the potential investors.

So for startups in my situation there are 2 potential way-outs for this.

  1. Even if it comes out bad, just sell on the other metrics that are growing and easier to fluffFor coworking spaces, when revenue, average price per workstation or EBITDA numbers are bad, coworking spaces can just rely on talking about how many “members” they have or “occupancy rates”. Both metrics that are easier to “pump” and “fluff” and could be used to show some growth story. I didn’t want to do this because I believe in having a consistent set of metrics that we share with investors and with the team so the team knows exactly what we’re going after every quarter.

    Which brings us to the alternative solution…

  2. Spend to pump the metric we need just to get us over Q4 and finish the raise.This would mean if I need to pump revenue I cut prices, or spend more on advertising just to boost occupancy even though I know it’s a short term game because cutting prices means taking on customers that will leave us eventually when we try to normalise prices. That means we’d be spending money on acquiring the wrong kind of customer.The problem with this method is that this isn’t what anyone would do if they had their own money at stake. For example say my problem is that our website has below average conversion rates because of the way it’s built. Before I spend a boatload of advertising money, it’d make sense to fix the website first right otherwise it’ll be an inefficient use of marketing spend. But in this scenario, if you’re chasing a Q4 number, you do it anyway because you have to hit that number right now to show consistent quarter to quarter growth all the way. In other words you fake it till you make it.

To be sure I called up two of our biggest investors at Colony: Oak Drive Ventures and Cornerstone Partners (a hospitality sector focused private equity firm).

I explained the problem I faced and then told them that if it were my own money, I wouldn’t spend more marketing money to pump the metric for Q4. Instead I’d rather take a miss in Q4 so I can fix the problem and then spend the money next year when I’m ready. I also explained that even after allocating all the investments for all the new locations we’ve committed to open next year, we still have millions in the bank as a safety net so even if we don’t raise money, we’re not going to go broke.

When I was done explaining, Cornerstone’s CEO asked me

“Tim. Do you know why we invested in you, when we have the chance to invest in so many other coworking spaces? We invested in you because of all the spaces we’ve seen, you’re the only one that makes money. You’re able to do so because of a combination of financial discipline, to picking the right locations, to negotiating good landlord deals and executing the business well. That is the value of the Colony and I think the type of investors we want would value that beyond just what you report in metrics”.

Oak Drive too agreed and explained that they were in this for the long term. So any decision I make should be for the long term. That was settled then. I would just focus on fixing the core issue and not throw good money after inefficient results.

At the end of this whole episode it really made me realise how important it is to have the right kind of investors with us. It doesn’t matter whether we’re selling coworking space, serviced office, event space or virtual office in KL… the end goal is to do it in a profitable and sustainable manner.


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Why having high barriers to entry in your business doesn’t matter as much as it used to anymore

In the startup world, before any VCs invest a typical question they ask is “What are the barriers to entry for your future competitors?”. Often the answer is scale in which the entrepreneur will then explain is why they need to raise money, grow fast at all costs and achieve that scale before anyone can beat it. That’s how I always thought of business. That’s not how I think about it anymore.

First let me argue against the notion that barriers to entry make a business unassailable. There are two types of super high barriers to entry that businesses can have: Government licenses /concessions awards to a company or companies with an immense network effect.

  1. Government Licenses / Concessions

I know this guy who’s very wealthy and made most the money in his life from getting government jobs in a developing Asian country. I used to tease him about how great it is to have a business like his with the license to print money. Unlike many other companies, he doesn’t have to worry about sales or how big a market is going to be. He’s already got all that covered in the form of a concession.

One day I decided to open my mind and ask him if indeed his business was difficult and he said yes. Why? He explained that while has had the concession to do what he did and print money for many many years, there is always someone else trying to get it from him. Someone else who can give a better price or if a bribe is necessary pay more or someone else who always knows some other powerful politician or all of the above. This is made harder because politicians come and go all the time so he has to constantly stay on top of it.

What happens if he loses it? He loses a lot of money. In many concession businesses like him, it requires a huge upfront investment to build something big that will have a long payback period. To come up with the money he often has to both find investors and take on a lot of bank debt. Now if something happened midway and his concession was canceled or renegotiated, he would stand to lose a lot of money and these things happen too.

So while government concessions from highways to power producers have turned our well for some people and made some rich, it’s still a business that is constantly challenged by others who want to get into the game. The barriers to entry aren’t as high as one on the outside might think it is.

2. Strong Network Effects like Google or Facebook

Okay what about companies that don’t have high barriers to entry because of government but just because they have an insane network effect. They have far more pricing power, far more distribution, far more everything. How would you compete with that?

I remember some 10 years ago I was sitting in the audience in the Web 2.0 Summit in San Francisco. Up on stage for a fireside chat was Mark Zuckerberg himself. Facebook then was getting a lot of press for its immense growth and people were saying the network effects they had were unassailable. I mean who else would join another social network if everyone was already on Facebook?

At one point of the chat, the moderator put up a map of all the other social networking companies that existed at the time. On that list was MySpace, Friendster, Bebo and more. The moderator then asked the magic question:
“Which one of these companies are you afraid might eat your business?”.

Mark Zuckerberg took a few seconds to think and then replied that he wasn’t afraid of all the companies in that list that existed today. He was afraid of the companies that he didn’t know yet existed that may come out of nowhere and eat his lunch. He was particularly conscious of his blind spot.

Years later it all added up. He ended up making some of the most brilliant acquisitions of all the time. Imagine what Facebook as a company would be like today if it didn’t own Instagram and WhatsApp. Or imagine if both these companies were owned by Tencent or Google or if they were large independent companies in their own right challenging Facebook for the social networking pie.

Ok so what about businesses that have no barriers to entry? Don’t they suffer from pricing pressure and increasingly lower margins?

Not too long ago I met someone who owns what he calls a transportation business in Penang. Their business model was to provide factories the service of vans and small busses to ferry workers from their homes to the factories. They started not too many years ago and now have a fleet of hundreds of vehicles to do just this. I was very interested when I heard about this because if anything this was a very highly competitive market with low barriers to entry (anyone with a van). They were not the oldest provider so what made them so big ?

As I dug deeper the answer was simply, they were simply run better than everyone else. That was a lesson to me. That there exist many many companies out in various industries there be it in logistics or F&B or manufacturing that don’t have a moat or huge barriers to entry, have lots of competition and still do very well and make a lot of money. Their secret? They just make sure they run things better than everyone else.

That was a mindset shift for me. From instead of thinking of how to build a moat that would eventually get broken down anyway to how do I make sure Colony is constantly at the top of its game, running things the best?

We live in the world where even huge businesses with far more economies of scale than any of its competitors are falling to disruption. History has shown that the time always comes when the disruptors get disrupted.

Why I can’t buy an iPhone XS for myself

As I was rushing to my gate at Sydney airport I passed by an Apple store. It didn’t escape my eyes that they had a sign up to say that the new iPhone XS was available for sale today itself. Australia is one of the first countries to get the latest iPhones and yesterday was the first day.

I thought of my parents. Both are iPhone users and my Dad has been using an iPhone for 2 years. My mom’s on the other hand is about 4 years old. I quickly decided to buy them each an iPhone XS. An iPhone XS for my mom and XS Max for my Dad. The total bill was something along the lines of RM11K or something.

When I got home later that night, my parents were in town so I gave them both the phones. My Dad was happy and gladly accepted it because he’d been thinking about changing his phone. My mom on the other hand protested strongly. She agreed that her phone badly needed a change (lots of features stopped working) but she insisted on buying an older version iPhone itself. She felt this iPhone XS was too expensive.

I don’t disagree with her. iPhones have gone up so much in price in the past couple of years that it’s just gotten really ridiculous. I no longer find it in myself to be able to buy an iPhone especially when other phones are so much cheaper. I currently use a Huawei P20 Pro which cost me only RM2.8K (and comes with free powerbank and all sorts of accessories) and it’s an awesome phone. It has every high end feature I could expect. It has a really awesome camera, finger print, face unlock, great size and screen, big battery… everything! And it only cost me RM2.8K.

Full disclosure, years ago I used to be a Huawei ambassador but for the past year I haven’t been. I bought my Huawei P20 Pro myself and even though I no longer work with the brand, my personal opinion is that it’s awesome. It’s a good value for money phone.

So when I’m used to paying RM2.8K for a top spec phone, the stretch to pay what… RM7K for a top of the spec iPhone XS Max is really too far. I can get over buying it for my Dad and my Mom because they’re used to iOS and don’t want to go through the learning curve of Android. But for myself… it’s just too much money to pay.

I’m getting messages from people now asking why not I just use it myself. Well the truth is that… it’s just way out of my budget of what I would pay for a phone. There are just other things I’d rather buy with the difference I would have to pay in price.

The good news is that I kinda just convinced my mom to just take the phone. She was looking at the iPhone 8 Plus 256GB which costs about RM3.6K. I worked out the math for her and based on a 4 year depreciation of the phone, she’s better off just taking the iPhone XS I bought her. Even when it comes to value for money and since she’s only limited to iPhones.

I think iPhones are a great phone and I admire Apple’s ability to price phones so highly and still drive demand. I just fell out of their market with the prices they charge for their latest phones. That and that I like an Android phone because it works well with my Google Home.

What my 5 year old son just taught me about true happiness

I was taking a morning walk with Fighter this morning when I turned to ask him:

Me: Fighter… are you happy with your life? Like are you happy every day?

Fighter: Yes.

Me: Are you ever sad?

Fighter: No.

Moments passed as we took a few more steps and then Fighter turned to ask
“Daddy… why are people not happy with their lives?”.

It struck me then that this was a foreign concept to my 5 year old son. That people could be unhappy with their lives when every day is awesome for him. As I thought deeper, it hit me that the lives we live as adults are incredibly stressful. We live in a world where we’re told that nothing is good enough, that we have to always strive harder. Get better results, more pay, more money, more recognition, more everything.

At the same time we’re surrounded by a small group of people who support us but by a bigger group of people out there who compete to best us at work or people who try to bring us down in life for whatever many reasons of their own.  We’re also told that we’re unique, but to conform. Try to be too different and people call you “weird”. Try to fit in with everyone and we’re not standing out in life.

How did we come to live a life like that? It’s as if modern life was designed to make us unhappy. But we weren’t always like that. As 5 year olds we were probably as happy as my son is. What’s the secret to happiness that our children have?

I was talking to my sister when she pointed out one thing. She said that the thing about our kids is that they don’t worry about the past, nor the future. They just live in the present. So when they’re happy, they’re happy. Nothing gets in the way of their happiness.

Ever felt that you were enjoying yourself on a holiday only to have the moment destroyed by thoughts of worries of the backlog work you’d have to go back to when you get back to the office. Or get a good bonus only to think that you’d have even more money if you didn’t lose money on that one investment you made some months ago. We’re constantly living our present, in the context of our past and our futures.

Why can’t we be more like our kids? Worse…. at what point do our children lose the ability to live in the present as they do now? Can we protect them for that or is that an inevitable future?

My sister ended up with a quote she said she got from a TV show but when I googled I couldn’t find the exact quote.

She said “True happiness is when we can live in the present without recollection of the past or fear of the future”.

If that’s what true happiness is… then it’s not something that can be bought. How do we get there?

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How do we become as happy as my 5 year old son?

How having money can sometimes make you more sad…

I spent the first decade post-graduation chasing money. Well to be exact I spent it chasing a career which had the indirect goal of making money. I’ve at this point of my life where I don’t think I have a lot of money, but I have enough to cope with our not so simple but yet not so luxurious needs.

I’ve always thought more money would make me happier. More money would mean I could eat out more, buy all the nice things I want, or buy gifts for the people I love who would be happy and pass that happiness to me. Money would give me new experiences, a trip to Disneyland or Europe, a stay in a nice resort. All those kind of things.

It’s only this year that I realise that money has the ability to make me sad too. I didn’t come across this realisation myself or from meditating in the Himalayas. No I got it from books that I’ve read that have given me perspective.

Now let explain why money has the ability to make us sad. Have you ever heard the saying that the pain of losing is stronger than the joy of gaining?

That’s why it’s hard to leave a casino table when we’re on a winning streak, but even harder to leave when we’re on a losing streak. Because while it’s great to win, it hurts to leave on a loss and accept that we have loss. That’s why when we invest in a stock, we tend to take profit too early but cut losses way too late.

Therein lies the problem. Having more money means that you have a bigger risk of losing that money and going through the pain that comes with it. The more money we have, the more we think about how we’re guarding it. If we keep the money just in a bank, we think to ourselves if we’re maximising the yield it could give us and when we get into investing, we feel terrible when we lose.

Let me share a personal experience I had. A few months ago I bought some Facebook shares. It had come down because of the data scandal but hey I thought that Facebook is a good company to invest in so I bought it. Within a few months I had made RM50K on that investment. I was over the moon.

The stock hit its all-time high when it neared it’s earnings announcement for the most recent quarter. I considered selling it and taking profit but I thought hey, what’s the worst that could happen., They’ll most likely beat expectations like they always have in the past and the stock will go up a few percentages more, or if they miss it, it’ll go a few percentages less. I decided not to sell.

The next morning I woke up and checked my phone for the news. I half expected to see news that Facebook had beat expectations once again and Mark Zuckerberg is now the 2nd richest man in the world or something like that but instead they posted results that were below expectations. Their stock tanked 20% in a single day, one of the largest loss in market cap in history (or was it the largest), wiping out most of my RM50K profit.

I felt terrible. The saying goes that it’s not your money until you sell the stock and take profit but there I was already feeling as if I made that money only to have it all wiped out. I felt crap that day and the next few days, even though other things were going well with my days.

Then I thought about this other friend of mine who’s my inspiration of how to enjoy life. She doesn’t save too much and instead makes it a point to buy things that make her happy all the time. I compared those few days with her. When I was feeling shit, she was feeling happy. She’s happy…. because she never made that investment and had that paper profit in her pocket only to have it disappear. I did. I was going through the pain of loss.

That put things in perspective for me. I tend to hoard money, I don’t spend too much on myself (though I admittedly spend a bit more on everyone else be it friends, family etc). But hoarding money and the fear of losing money that comes with it makes me a lot more risk averse. Like I’m afraid to make investments that could either financially pay off in the future or just make me happy.

In the past year it has really helped that I realise I don’t need too much money in life. I don’t crave European or Japan holidays, nor watches, or fancy cars.. or any of these things. There is one luxury that I really appreciate and that’s having a driver though because he helps me send our kids to school or my car to a workshop… and also because I hate driving.

But really if I don’t need too much money, and the fear of losing money makes me sad… what am I chasing here exactly?

Don’t get me wrong, I never want to take money for granted. I appreciate every cent which is why I hoard it and am very careful with it… but now is the first time ever I realise… that having money… can make you sad too. I suppose that’s why we hear so many stories of lottery winners go into depression or suicide.

Perhaps the answer is to have just enough money… but how much is just enough? That’s the million dollar question.

Why it’s worth buying a super TV for our homes

This article is in collaboration with Panasonic OLED TV.

Have you ever been in a mall, standing in front of a TV shop admiring whatever big TV they have on display as it screens high definition nature videos to show off its colour?

I know I have. I would watch it for a while and imagine how beautiful it would look in my living room and fall into the temptation of checking its price. When I make eye contact with the price tag, my body would exhibit a natural jerk backwards as the words “SIAO!” would leave my mouth. I watch a lot of TV but I find it so difficult to fork out anything in the 5-digits of Ringgit to buy one.

Then just a couple of weeks ago, I got connected to Panasonic who decided to let me have one of the best (if not the best) TVs in the market now just to see if I might change my mind about how much I would spend on a TV.

The TV they got me was a 65″ Panasonic FZ-950 OLED TV. It’s this beautiful baby right here.

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This TV has such accurate display of colours that it is known to be used by many producers/actors/artists in Hollywood to screen their own videos.

I’m all about aesthetics so it matters to me how the TV looks. I love its super slim side profile and I love how the screen expands to the very edges of the frame. This makes it look really beautiful when I sometimes leave the TV on to look like a piece of art on my wallet than a TV like this.

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But okay.., beauty aside the big question is… is it worth buying what I would refer to as a “Super TV” or the current top of its class in the market. Well after using it for a few days here’s what I’ve totally underestimated.

  1. We watch a lot more TV than we used to.

I gotta admit. 5 years ago I probably hit the minimum amount of time I ever spent daily on a TV. Why? We would just watch things off our computers or phones or iPads. That has changed significantly for me.

Why? Well… a few reasons ranging from Netflix constantly coming out with binge-worthy content to dominate every free hour to technologies like Google Home and Chromecast. With Google Home if I ever wanted to watch something, I just say “Hey Google, play Friends on Netflix” and it’ll come on right on the TV and pick up where I last left off. Much much less effort than it would take me to search for it on my phone.

Then there is the Chromecast. Any video whether it’s on YouTube and all that I would have watched on my phone? I just click one button and it goes on to the TV.

Because the applications of TV have grown so much more in our lives, I find it much more worthwhile to have one good one. Also I think that the amount of innovation each new iteration of our living room TVs have gone through have largely gone unnoticed. I mean look at the apps that the newer TVs come with now, so much that my TV that’s just 5 years old really feels like a Pentium PC.

2. We spend a lot more time at home.

Another reason why we use a lot more TV apart from its expanded applications is that I find we spend much more time at home. Partly due to technology. We used to go out a lot to socialise but we do a lot of that from our phones now. We also used to have to go out to buy new clothes, groceries or sometimes that irritating one multi-plug we are short of. Well we don’t anymore. I find myself just buying everything online and staying at home much more.

This is even more compounded by the fact that we now have two kids. So it’s a lot more difficult to go out and we really really pick our trips. The rest of our time is spent at home where the kids will play with their toys or watch some TV. The things kids can watch on our TVs these days aren’t the limited options we had as kids from Cartoon Network. Now they have everything from all the Disney shows on Netflix to Ben & Holly on YouTube.

Some of the happiest times I spend at home is when our whole family of four is sitting on the sofa watching TV.

3. There is a noticeable difference with the experience of watching an “okay TV” to a “Super TV” like this Panasonic OLED one.

My mom was watching Britain’s Got Talent on YouTube on it just a few days ago and the way the screen stands out at you with the built-in sound that comes out really doesn’t make you feel like you’re just a spectator to the experience but that you’re part of it. This is one thing that I just can’t figure out how to explain in words.

But then again there is still that thing about the price. How do we justify spending so much more on a super TV?

Well… I did some math.

When the four of us (two kids included) go out for a movie, we pay RM60 for tickets on a movie that goes on for an average of say two hours. That’s about RM30 an hour.

The TV is used by 4 of us at home. I estimate that it’s on about 4 hours a day on weekdays (two hours by the kids dancing to Psy or watching Peppa Pig in the background, and about one or two hours from me and Audrey each night). But just to account for some nights that Audrey and me might go out, lets just take 3 hours as an average for a weekday.

On weekends we watch more. I estimate about 5 hours in total. So per week we watch about 25 hours of TV. That’s 1300 hours of TV a year.

This Panasonic OLED TV that I have cost about RM10,999. If I divide that by the hours I use a year it would be RM8.4 per hour and that’s if I assume I keep the TV only for a year. Realistically though TVs will last us at least 5 years. So If I take 5 years that would be about RM1.70 per hour. That’s gotta be like the cheapest form of entertainment there (minus the electricity which probably won’t be material).

Based on this, owning a “Super TV” is a great investment and I’m glad Panasonic gave me the chance to experience on before I came to this conclusion.

Refunding unhappy guests, renovating smoking areas and building prayer rooms: How far Colony goes for its guest experience

The Coworking Space industry is brutal. Last year there was a reported 37 coworking spaces in KL alone, this year I expect the number to be at least double of that. What makes it brutally competitive isn’t just the number of players but because of the amount of investor money pouring into the industry. In this era of cheap money, operators have the opportunity to raise a lot of money at high valuations and use that to open more outlets, spend lots of marketing and cut prices in order to gain market share.

Colony’s strategy isn’t to raise more money to outspend others or open more outlets. In fact in a world where other coworking space operators are targeting to open hundreds of outlets in two years. Our ambition is to just have 20 well run and profitable outlets in five years. Any time we’re in doubt about what to do, we go back to our mission of empowering life at work. To change the experience of work so that going to work no longer feels like going to the office but going instead to the Ritz Carlton or Four Seasons.

In order to do this, we need to be obsessed about our customer experience. If there’s one thing you’ll notice about Colony, is that other coworking spaces refer to their customers as tenants or members, we refer to them as guests just as hotels do. We’re less about creating a community and more about hospitality. We don’t sell desk or office spaces. We sell an experience. The Colony experience.

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Because of this we are obsessed about the guest experience. We send out quarterly surveys and track customer experience with metrics like Net Promoter Score. On top of that, every week at our huddles, our team is asked to present feedback that they have compiled from our guests, good and bad (though we tend to give priority to the bad because that means we need to act immediately).

We take extreme ownership when it comes to anything that affects a guest experience from when the time they walk into Colony to the time they leave. Apart from the great hospitality that my team puts together in terms of anticipating guest needs and always being around for them, here is an example of the things we’ve done.

  1. We killed the industry-old practice of auto-renewing client contracts

A common practice in the coworking space/serviced office industry is an “auto-renewal” term. If you rent a space for 3 months, when it comes closer to the end of your contract, the operator will send you an email reminder that unless you formally terminate the agreement, they will auto-renew your term for another 3 months, That’s great for the operators but it pisses off the customer if they forget to formally terminate because they feel cheated into going on for another 3 months. Nevertheless many just accept it because it’s all in the contract they signed.

The problem I had with that practice though is that even if we do win over the customer for another 3 months or 6 months or even 2 years, it ruins the customer (guest in our case) experience. Is an additional 3 months rental worth forever losing that customer? Since I’m trying to build a long term sustainable business though, that answer is NO. So with Colony we specifically took that term out. If your contract ends, it ends unless you tell us you want to continue. We don’t lock you in anymore beyond that.

2. We have fully refunded customers if they didn’t have a good experience

In fact at Colony we go even further. We had one guest that signed a contract to rent our space for one month. He spent two weeks working at Colony though in his second week we had a number of events going on in the space. So it was a lot noisier and crowded than he would’ve liked. He came to our front desk and vented his frustration as our team listened empathetically. The team offered as many alternatives they could think of to solve his problem but they weren’t good enough so he left angrily saying “I’ve had enough of this place”.

We take these kind of things very seriously so our team had an emergency meeting to discuss how to proceed with this. After listening to everything that happened I suggested that we should fully refund him.

I watched as eyebrows arched upwards around the room. After a few seconds, one of my colleague asked “How much?”. I said “Everything”.

“But he’s already used two weeks worth. Should we just refund him the remaining two weeks?”.

I thought about that for a moment then replied “No. Refund everything, even the first two weeks that he used the space for.”

I then went on to explain that we have to build a company with guests who are happy with what they pay for. Sure this mindset opens us up for abuse by guests who do these things just to get a freebie out of us, so we have to evaluate this case by case to see if the guest has a genuine problem or they’re just trying to take advantage of us. In this case I believed him. He had a genuine problem.

There’s an ending to this wonderful story. A few months later, this same guest came back and rented out an office for a year. He is now one of our strongest advocates for the space. What we did turned an angry customer that we would have lost forever, to a loyal one. Now the Colony team makes decisions like this on their own if they think it will create a great experience for the guest. We do a lot of things like that at the expense of short term profit sometimes.

3) We built a prayer room

In one of our guest feedback recently we were asked if we could have prayer rooms in Colony itself. Coworking spaces and serviced offices are about fully monetising every square footage of space. We worked out converting two existing offices into Suraus would cost us RM57,600 a year (not including the cost to convert one) in foregone rental but we decided to go for it anyway. Why? Because it was an important part of the guest experience.

4) We spent our own money renovating the building’s fire escape because people often hung out there to smoke.

Another thing we did? We noticed that because Colony @ KLCC doesn’t have a smoking area, a lot of our guests resorted to just going to a fire escape to smoke. The fire escape looked really bad with black walls and no light there so it was really dark.

While the fire escape isn’t part of our property, we knew that where our guests hang out (to smoke or otherwise) is part of the Colony experience. So we asked the building management if we could do up the place at our own costs and they agreed. Here is a before and after photo of the space.

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When our guests found out about our plan to renovate the fire escape so they had a nicer place to smoke, one of them said to me “The extent to which you guys go is amazing”.

If we could, I’d put a fan and some seating there but it is a fire escape after all so we can’t put anything there to block it.

Our new Colony @ Eco City though has a kickass outdoor smoking area. Here’s how it looks.

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All these things cost money, so what’s the upside? Did it help us make more money in the long run?

Well Colony @ KLCC is surrounded by other coworking spaces that are cheaper to rent. So far we haven’t lost an existing guest to another coworking space yet even though our average prices have gone up by 25% in the past 12 months. Sure we’re bound to lose some eventually but I believe that if we keep improving on our guest experience, we’ll have a strong retention rate and be able to deliver consistent earnings.

We have a long way to go though, hospitality and service is about consistency and we still have lapses in our service levels every now and then.

Dear TV

This article is in collaboration with Panasonic OLED TV

Welcome to our home. I know lots about you. I know you’re a Panasonic 65” OLED TV of Japan Quality.

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I know you’re OLED which means you produce some of the most beautiful colours with pictures so sharp producers and filmmakers in Hollywood use you for viewings of their own work. I know you’re a really smart TV with all sorts of features and apps built in and I know that Panasonic wirelessly beams updates to you every now and then.

You probably don’t know much about me and my home so let me start.

First let me introduce the two most important people in the house.

The one on the left is my 5 year old son Fighter and the one on the right is my 3 year old daughter Penny.

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Fighter’s real name is Jude but we call him Fighter because he was a premature baby who had to fight for his life when he was born weighing only 1.1 KG. He’s a people person, very warm, loving and caring. When you first arrived at our home, Fighter was the most excited, rushing to you and caressing the box you sat in. He’s that loving to anyone who comes to the house.

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On the flip side Fighter can sometimes be easily scared by the unknown. He once got really scared while watching Coco hiding behind me in the cinema and saying he doesn’t want to watch it again. It’s hard to pin down a trend of things he finds scary because sometimes it can be the really random things. On one occasion he saw an army officer on TV and he got so scared he ran all the way upstairs to mommy.

Fighter is Psy’s biggest fan. So if you ever want to keep him happy, just play some New Face or Gentleman by Psy and he’ll jump for joy like his daddy just bought a toy store. He will likely ask you to max the volume when Psy comes on the TV which you may oblige.

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Do watch out for him though as he tends to dance along with Psy’s videos he’s a little clumsy so he might knock a thing or two over.

Next is Penny. Penny is a loveable 3 year old girl who loves Mommy and her elder brother Fighter, and occassionally loves Daddy depending on her moods. She generally likes girls… not boys so her favourite shows on TV are Super Girl, or any music videos with pretty girls. Girls’ Generation music videos would suffice in most cases.

My wife always says that Penny’s default emotion is “Anger”. Let me illustrate what that means. If you give Fighter a Tic Tac and then you tell him just one is enough, he’ll be sad but he’ll accept it. Penny on the other hand might skip the “being sad” part and go straight to being angry.

Penny is also fiercely competitive. Her purpose in life seems to be to win, no matter how trivial the game. If you play a game with her and she wins, she’s happy. If she loses… well… you got it… she gets angry.

 

Next up is my wife Audrey, also known as popular blogger Fourfeetnine. Sometimes I get referred to as “Fourfeetnine’s husband” though now increasingly she gets referred to as “Fighter’s mom”.

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Audrey is the love of my life. She’s good with people, never afraid to laugh at herself and for that reason I find her very cute. Perhaps that’s why I married her. She’s a very principled person so she gets very offended when injustice takes place and finds the need to do something about it. For example she was really unhappy with how our ex-PM was running the country and beyond just fearlessly blogging or posting about her thoughts on social media, she went out to be a Polling AND Counting agent on election day. She woke up at 5AM that day and came home about 9 or 10PM.

When she’s not out there fighting injustice or taking care of the kids, she’s watching her favourite TV shows with me on our late nights. Her current favourite is Handmaid’s Tale, but Westworld, Unbreakeable Kimmy Schmidt and the likes come close. Her all-time favourite TV show though? Friends. She loves Ross Gellar and you can turn it on at any time of the day and she’ll sit down to watch it the umpteenth time.

Lastly there’s me. My friends call me Tim, though my old school friends call me Tiam (after my Chinese name). I’m the luckiest person in the family, to be able to have Audrey as my wife and Fighter and Penny as my kids. I work during the days and sometimes at night. When I have time I try to read but TV to me is more than just entertainment. It’s the way I bond with my kids and my wife. Some of the best moments for me are sitting down on the living room couch watching something with the whole family.

So you see my Dear TV, you’re not just some other electrical appliance in our home. You are the glue that keeps us all together and helps us grow as a family. It’s for that reason I think it’s fitting that you’re placed in the most prominent place of our home, the living room.

Welcome to our family and please… make yourself at home.

Your new owner,
Tim

The story of how I cured myself from worrying about everything

Have you ever gotten into these worrying fits where you worry about something so much that all you can do is think about it all the time that it paralyses you from doing anything else?

Like if  it’s a health related problem, you end up spending a long time on Google trying to find out all the possible causes and symptoms even if deep inside you know it’s most likely nothing?

Well that was me for all my life apart from maybe the past year or so. My mom knows it, my friends know it, heck everyone I work with know that I was a chronic worrier. This is the story of how I went from a chronic worrier, to someone who does not worry at all.

Early last year I was going through a period of self-reflection to analyse all my flaws and one of those flaws was this chronic worrying habit I had. I read all sorts of books to get over it. From tips to think of the worst case scenario so that you know it might not be so bad to meditation. None of those worked for me.

To solve this problem I first had to figure out what was the root of my worries or stress.

What is stress?

There are 3 main types of things that cause us stress:

  1. Fear that reality won’t meet expectations. Whether it’s not doing as well in an exam, or winning a competition, or even that you expect justice from harm done to you but you don’t get it.
  2. Fear that we might lose something be it money, someone that we care about, or our health.
  3. Fear of humiliation. That we might be in a position that people will think poorly of us.

These 3 things cover about 95% of all the stress or things we worry about. How do we get over them? Well the first thing we have to accept is this.

STRESS IS NOT NECESSARILY BAD. STRESS IS GOOD!

Why? Well my answer on the first point explains it.

  1. How to overcome the fear that reality won’t meet expectations

The only way in life where reality will consistently meet expectations is if our expectations are always low. If we never try to succeed, we won’t stress about failing will we? But is that a good thing? If we want to succeed in life we have to consistently push our boundaries, do things that put us into uncomfortable situations so that we can grow. So that we can do better things.

Avoiding stress would mean staying within our comfort zone all the time. Never taking any risk. Never achieving what we could be fully capable of. Is that a reality that we’re willing to accept? It’s a choice we have to make. Live a happy life without stress and not feel pressured to achieve anything… or live a stressful life and die knowing what you are really capable of.

2. How to overcome the fear that we might lose something.

I borrow a Buddhism teaching on this one.

“Suffering arises from attachment to desires. Suffering ceases when attachment to desires ceases”.

We feel attached to our money, our homes, our possessions and losing them causes us “suffering” or stress. What if we accept that nothing we own is really ours, but just borrowed for a certain period of time. To be general on this one, lets just refer to money here. Even if we lose it today, we could possible earn it back tomorrow.

I know I know it sounds nuts but I feel better about losing money these days not because I take money for granted, but because I feel I have a chance to earn it back since I’m still young and able. Plus we humans have this amazing ability to adapt. History has shown that even when humans are thrown into concentration camps we have the ability to find a way to survive. So in our very 1st world problem world, even if we have less money, we’ll still survive.

Now there are some attachments that I think are worthy of stress. Attachments to our family, our kids and heck life. I don’t ever underestimate the stress losing any of these things might bring but hey if we can just manage our stress when it comes to money or material things that’s a huge chunk of stress we’re eliminating.

3. How to overcome the fear of humiliation

Humiliation comes from something that happens that is the opposite of how we want other people to perceive us. We worry about what people might say about us, or what our reputations might be.

Well…this is something I’ve said before but I’ll say it again. Modern society brings us up to believe that each and every one of us is special. We’re unique. Well… guess what… we’re not.

Human beings have existed on this earth for 350,000 years. Our lives which may span 100 years accounts for about 0.029% of all human history. We are one dot in the timeline of the entire human race and even if we compare ourselves to all the 6 billion living humans today… who are we?

How full of ourselves must we be to think that anyone really gives a flying f*ck about who we are or what we do? People are driven by self-interest and the only interest people are going to have in us is if we offer something that serves their self-interest be it something funny, or a juicy scandal or something… and even then it’s only worth a short period of entertainment value at the water cooler. Notice how even the most viral scandals die off after a few days and people move on?

That’s because unless you’re someone everyone should give a f*ck about because you affect them (like if you’re the President of the USA)… nobody is going to care after a while.

So why do we care so much about what people think about us? Sure if it’s something that affects your integrity like stealing money from a sovereign wealth fund (like 1MDB) or being found guilty for stealing or misappropriating money from a company then that’s much harder to come back from… but anything else about what people might think of us? Don’t sweat it.

I know I don’t. I detach myself from social media only going in to post and hardly to browse or read comments. I don’t know what people are saying about me… it could be good it could be bad… but all I know is that in the grand scheme of things, it doesn’t matter because I am nobody.

So once I learned how to overcome the above, the last remaining piece of the puzzle I needed to understand was this.

Stress is a muscle. The more stress we expose ourselves to the higher our stress threshold becomes.

I knew personally that I wanted to at least try to achieve things in my life so it’s not an option for me to live a stress free life. Instead I needed to drastically raise by tolerance threshold for stress. So what I did in the past year was to go out to get more stress. If I found something new that stressed me out I would load myself up with even more of that one thing until I was numb to it.

The first time I took on a heavy lease commitment for Colony I was worried. Then I went on to take 3 more. Now I have 4 and it doesn’t stress me out anymore. In the past if anyone ever threatens any legal action on me I’d worry about it. Now I embrace it and I’ve actually learned to appreciate the process. I was afraid about the cyst I had in my pancreas and whether it might be dangerous, so instead I went on to read about all the other diseases and sickness I could die from and poof I stopped worrying.

My pain threshold for stress has gone up a lot in the past year and it has really improved my life. I can’t remember a recent night that I couldn’t sleep because of stress. I sleep well every night and if I ever can’t sleep it’s more because my mind is active thinking about what I’m going to do the next day or other things rather than stress.

I am also a lot more calmer when shit hits the fan, preventing myself from making emotional decisions and allowing me to make very calculated calls. Heck I used to make emotional or knee jerk reactions all the time… but now I don’t and I think that has helped Colony grow so well to what it is today in such a short time.

It’s ironic that my cure to chronic worrying isn’t to take myself away from stress but to embrace it and take on more stress. I don’t think I’ve totally mastered it yet, but I’ve seen a significant change in myself and I hope my experiences here help other people out of it to.

It’s no fun being a chronic worrier. I would know. I was one.

How telling our biggest investor about how I’ve fucked up made him double his investment in Colony

A few months ago, I was sitting in our big boardroom in Colony across from ODV, our biggest investor in our seed round. J who was the CEO of the fund was in KL for the first time in years to visit Colony after his team told him that he had to come to experience Colony to really understand what they were investing in.

I watched him happily nod as I presented our business performance. The business was doing way better than expected and we were growing rapidly in all four of our key metrics: Revenues, Profits, Occupancy and Price per workstation (which affects margins). At the same time we were getting offers from other investors who were keen to buy a stake in the company at more than four times the valuation ODV had invested in six months before.

Things were looking good until I paused the presentation and said “If you look at all our business metrics, everything is looking good. But I think it’s important that I show you what’s under the hood… and we do have some serious problems”.

I explained to them how revenues, profits, occupancy, price and even financial statements are all “lagging indicators”. Meaning they’re numbers based on past performance and are no guarantee of future performance. My job as CEO though isn’t to celebrate past success but to look at problems I’ll have in the future and fix them before they happen. For those I need to look at “leading indicators”. Numbers that will tell me something is wrong before they actually lead to bad financial results.

There are a number of leading indicators I set up early this year. For sales it’s just pipeline, number of tours, number of leads etc etc. That’s easy and common. But I needed a way to measure future customer retention (no point winning customers if we can’t retain them) and because I believe happy employees lead to better business performance I needed to measure employee happiness too.

My solution for this was to adopt what we call a Net Promoter Score. Here’s Wikipedia’s explanation of that score.

The Net Promoter Score is calculated based on responses to a single question: How likely is it that you would recommend our company/product/service to a friend or colleague? The scoring for this answer is most often based on a 0 to 10 scale.[4]

Those who respond with a score of 9 to 10 are called Promoters, and are considered likely to exhibit value-creating behaviors, such as buying more, remaining customers for longer, and making more positive referrals to other potential customers. Those who respond with a score of 0 to 6 are labeled Detractors, and they are believed to be less likely to exhibit the value-creating behaviors. Responses of 7 and 8 are labeled Passives, and their behavior falls between Promoters and Detractors.[4]:51 The Net Promoter Score is calculated by subtracting the percentage of customers who are Detractors from the percentage of customers who are Promoters. For purposes of calculating a Net Promoter Score, Passives count toward the total number of respondents, thus decreasing the percentage of detractors and promoters and pushing the net score toward 0.[5]

In Asia it’s particularly hard to get a positive Net Promoter Score because we’re more conservative. To us if we were asked “How likely are you to refer <brand> to a friend?”, giving a score of 7 or 8 would be us giving a good score. But in NPS surveys, that’s a passive (neutral) score. Not a promoter. In any case it’s not just the score that matters but the feedback we get later on why we got those scores that give us a good insight about what we need to improve.

I took the time to explain all this to J and then pulled out a slide to show him what our NPS for customers and employees are. On a score of -100 being the worst, to 100 being the best, our customers rated us -6. For employees? We got a -44, a disaster for me since I have every intention to build a company that puts employees first. I thought everyone was happy but the data says I was wrong.

I went on to say that these were worrying numbers to me and if I did not fix this soon, it will eventually lead to declining business performance (Those 4 metrics? Yeah they’ll be going down). After I finished I sat back down on my seat and waited for J to give it to me but he didn’t. He just nodded. We ended the meeting shortly after and I went back to work while the ODV team stayed in the room to discuss other matters.

A couple hours later I went back to see if they were ready for me to bring them out to dinner. As I walked into the room, J asked if he could bounce an idea off me.

He then explained how whatever he has invested in Colony so far is already at the limit of his fund’s mandate so he didn’t come to KL with any expectation nor intention to further invest in Colony. But after listening to my presentation, he found that Colony was a very good business and he appreciated how honest I was about our shortcomings.

He explained

“You know… we’ve invested in many companies and very rarely are the CEOs so forthcoming and honest with the problems of the business. Your honesty tells me that you really value your relationship with your investors”.

I replied that to be fair, it’s really to my own self-interest because I could hide the mess under the hood or fluff things up, but how long can I hide it for? 3 months? 6 months? Sooner or later it’s all going to catch up to me.

“That’s true. But not many people think that”,

J replied.

He went on

“Anyway… I’m going to tell you that we’ve never done this before for any one company but what would you say if we doubled our investment in Colony?”.

I let those words sink for a while and I thought about it. It’s a good thing to have our investors want to put in more into Colony but I had one worry. If I took this extra money there would be a significant oversubscription to the round I intended to raise. Which means I’d dilute my stake more and I intended to give a chunk of my personal stake to key employees of Colony so they could all own a part of it. I’m not greedy for economic rights of the shares I own. What I do care about is control of the company because I’ve had ventures in the past that have failed because I didn’t have control of the company and couldn’t do things the way I thought was best.

If I diluted too much, I would fall below 51% voting rights of Colony. I conveyed these worries to J and he said

“Do the math. If you end up with less than 51% voting rights, you can have our voting rights”.

I was stunned. What did I do to deserve such a great investor. It turns out I had other great investors too, most of whom doubled down or more than doubled down on their initial investments. On top of that we had new investors too that contributed to the war chest we have today to expand Colony.

Still I had to fix the problems we had. So after that meeting I hunkered down to work on our NPS. I’ll explain the steps I took maybe in another article but fast forward today here’s what the team at Colony managed to pull together:

  1. We just reported a customer NPS of +40.
  2. 51% of respondents were promoters that means they gave us a 9 or 10.
  3. 37% were passives meaning they gave us a 7 or an 8 out of 10.
  4. 12% were detractors meaning they gave us 6 or below.
  5. Employee NPS also went from a -44 to +33.

Does it correspond with business performance? Hell yeah. We reported 91% increase in Profits (or more specifically EBITDA) in Q2 vs Q1 in our first location. Our second location at KL Eco City is expected to open next week and we’ve already sold 56% of the space even before opening.

This key takeaways from this is:

i) People who have millions to invest have millions for a reason. They aren’t stupid and they know when you’re trying to fluff then. It’s just a matter of whether they bother to look or not.

ii) Be radically honest with investors or shareholders. It builds trust and if business ever takes a downturn (which all businesses at some point do), trust is the currency we’re going to need the most.

iii) Being honest with the bad metrics forces you to act to fix it. Perhaps I’m the type that work better with pressure but hell did I get my ass working on fixing the NPS.

As for J? I sent the investor update with our latest results for Q2 this week and he replied

“Thanks so much for this update Tim. Looking good :)”