Startup slugfest: Business model vs business ‘frame’

Published Date: 18/02/2016

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YOU will be familiar with the term ‘business model,’ most commonly used by technology entrepreneurs to describe the activity of their enterprise. In our research of successful entrepreneurs, we found that the term ‘business model’ does not adequately describe the process of birthing a business idea, leveraging on strengths, and marshalling of resources – present and future – to form a business. With the benefit of hindsight, the model seems very neatly put together and it is often coupled with a corporate vision.

The reality is quite different. Typically, we have found that entrepreneurs only have a vague sense of what they are trying to put together.

“We call this a ‘business frame,’ which we define as a broadly defined frame that brings together hitherto unconnected capabilities, talents and opportunities, at the right time, to form the foundation of an enterprise’s exponential growth”, – tell entrepreneurs.


Noor Helmi, Founder of IX Telecom

Noor Helmi, co-founder and chief executive officer of IX Telecom, started his company in 2008, after stints at the now defunct local telco Atlas-One and then AirAsia.

At a young age, Helmi had responsibility for network planning and the build-out of AirAsia’s IT infrastructure in China, Indonesia and other countries in the region. That’s the advantage of working at a small company – you get a lot of responsibility, very early. He was on the founding team at Atlas-One and the fifth IT employee at AirAsia.

With Amzari Tajuddin, he started with the remote management of routers and appliances, the two securing their first customer in Singapore.

Helmi says, “I always knew I wanted to be an entrepreneur and I looked at starting a telco (network operator), but that required too much capital. So I thought, why not focus on virtual networks?”

Eight years later, IX Telecom has evolved into a Data VNO (Virtual Network Operator) across 200 countries, with more than 30 staff based in Cyberjaya.

ENTREPRENEURSHIP DRIVING EMPLOYMENT, FOR NOW

IX Telecom had no VC funding and invested a total of RM200,000, and today offer employment to about 500 people, primarily based in Malaysia.or businesses that target the consumer directly with undifferentiated products, like the now-defunct ring-tone business or airtime top-ups, advertising and distribution work. However, for software applications and specialised services, entrepreneurs in the local environment have a tough time.

With very few exceptions, companies are so averse to ‘buying local’ that local software companies struggle. IX-Telecom and Fusionex both found their first customers in Singapore. In the case of IX-Telecom, its first customer was Malaysia Telecom-Singapore, which then opened doors for them in Malaysia, something they were not able to do on their own!

We need to support local entrepreneurs by buying their products and services. And we need to do that soon because, with the signing of the Trans-Pacific Partnership Agreement (TPPA), we will see established foreign companies coming to our shores.

They will have the advantage of a larger customer base, more developed solutions (through a deeper and longer customer iteration and learning process), and will probably be cost-competitive.

If we want to build local champions capable of going out into the region, we need to support entrepreneurs in a much more aggressive manner – else we would have closed the door on local technology entrepreneurs!

Digital News Asia