By Charumini de Silva
Several private sector leaders present at the Venture Frontier Lanka-Daily FT forum, ‘Transforming Sri Lanka with private sector leadership and entrepreneurship’, shared their own insights on how important entrepreneurship was for Sri Lanka and what needed to be done to boost entrepreneurs.
The panel of experts were Cargills Bank Ltd. Managing Director and CEO Rajendra Theagarajah who is also Chairman of the Ceylon Chamber of Commerce, Venture Frontier Lanka Co-Founder Heminda Jayaweera and Venture Frontier Lanka Co-Founder Ovidiu Bujorean whilst several CEOs who attended the forum also shared their insights.
Some of the specific questions and issues raised during the discussion included what role should the private sector play, what role can the management play in boosting energy levels within, how can the mindset of the youth be changed from being jobseekers to jobcreators, promoting intrapreneurship, issues of financing, ease of doing business especially for startups, importance of mentoring, importance of coming up with breakthrough disruptive ideas and idea generation.
Rajendra Theagarajah, Cargills Bank Ltd. Managing Director and CEO who is also Chairman of the Ceylon Chamber of Commerce
From a macro perspective and from a financial side of it there is a certain limit on what we can do in terms of startups and entrepreneurship. Banks are probably the most highly regulated, so there are certain things you can do and you cannot do. However, that doesn’t mean the wealth of reserves in the banks cannot be deployed in supporting the energy levels. This is not necessarily only from a financial perspective, but also from a mentoring perspective and other means.
There is a need to nurture intrapreneurs as opposed to entrepreneurship. There is a huge opportunity; but it is a question of pitching at the right opportunity. Let someone take the lead, however senior you are, learn from that. I have been doing that for several decades and I have no issues at all. Banks are not one pillar of prerogative in an ecosystem. I think there is room to be collaborative. The more you collaborate, the more energy you can bring together. The other issue is understanding what you can and can’t do in your organisation as well as in your own personal space to foster entrepreneurships. Three friends got together and gave leadership to an initiative called ‘Athpaura’, equivalent to the Shark Tank in a much smaller scale, but to create an impact in entrepreneurship. This was done in our personal financial capacity to validate our passion for this. I think there are multiple opportunities. There is good example I need to share with you all. This is from the tea sector, one of the oldest industries we have. There was a private sector tea estate owner which had 50 acres. The owner said that he could not operate with the current fixed cost and has a different strategy which would be decided with the workers. He went on 100% variable cost, gave each of worker a two-acre land and made them a profit partner. So, he gave all the input and entrepreneur mentoring, and the workers got a percentage of what they put in. To me it was completely thinking out of the box. He wanted to survive and he hooked out of the box. They pulled out the entrepreneurship from the pool of talent they already had. Let’s be realistic, the nature of formal banking is not designed to foster startups. On the other hand, we will look at from an individual selfish point of view. I think, if we have wherever there have been pockets of startups or venture funding it has gone directly to companies as opposed to venture capital or venture fund.
I think another issue is that the ability to scream and invest also is probably not as much as in larger markets. I think there is perhaps an opportunity to reshape the type of venture funds, which we should be forming in Sri Lanka, not just fits the providers fund, but maybe representation from professional services. Not just to put the capital, but maybe getting into the transactional supporting for the first years. The Ceylon Chamber is looking at a Young Business Forum to pool resources in future. While there are very good models in the region, what Sri Lanka needs is to craft its own cocktail solutions, while picking the best way to go forward.
Venture Frontier Lanka Co-Founder Heminda Jayaweera who is also Senior Fellow for Innovation and Entrepreneurship at the University of Moratuwa
Right now I’m heading innovations and entrepreneurship at the University of Moratuwa. When I passed out 15 years ago as an engineer, my only wish was to join a blue chip company and get a better salary. That was the mindset 15 years ago. Out of over 2,000 graduates, 150 of them are already engaged in the ‘Mora Ventures’ an incubator that we have started. Out of that 150 around 25 of them are startups and already have customers too.
There is tremendous potential to encourage more entrepreneurs, especially the educated youngsters who are now moving to entrepreneurship. I think it’s an area we can really tap if we can give those undergraduates and youth the right support, at the right time; we would be able to hear some remarkable success stories in the future.
At the Jaffna Startup Boot Camp we had in early May we were a bit worried that we wouldn’t see the same level of talent from Jaffna as we saw in Colombo boot camp. But they surprised us, it was indeed very refreshing to see their enthusiasm. One major difference was that the entrepreneurs were quite younger than we saw in Colombo. There were 10 mentors from Jaffna, Kilinochchi and Vavuniya with short notice. They were just waiting for this kind of support from someone and similar events of this nature. Funding is a big issue with entrepreneurship. The opportunities are limited. There are very few venture capitals, angel networks and on the legal side there is a lot improvement that needs to be done, particularly with labour laws.
Advisor to Prime Minister Charitha Ratwatte
We have a couple of issues in encouraging young people to be risk-takers. There’s a culture of risk averseness. Only a minority is willing to take a risk, the majority protesting on streets want government jobs. We give internship schemes at the Prime Minister’s Office where we take first class honours graduates for a shot time to come up with new ideas and solutions that are out of the box. If we just assign them to Government departments, they will come up with the same old ideas with a new picture on the cover – that’s not going to work now.
We want innovative thinkers and fresh ideas. Experience means you know what you can’t do, whereas when you’re young you’re willing to push yourself. So it is financing, exposure and all other things which is happening. The 4% unemployment is basically ‘aspirational unemployment’ because the kind of job they are looking at is not there; they are not willing to work fulltime. This gig economy is already with us. There is a national pension fund coming, even the private sector can get annuity. There are a lot of initiatives being rolled out.
National Chamber of Commerce Secretary General Shiham Marikar
One issue I see among exporters is that when a young person joins an export company, the plans are already made, the policies are set; so there is not much room for them to actually put into practice their entrepreneurial skills. Instead of having old policies in place, we must encourage our export-related companies to allow their young staff members to come out with some new thinking.
The Calamander Group Inc. Chairman Roman Scott
Everywhere you go in the world it is tough with the traditional banks to obtain financial facilities. Entrepreneurship has flourished and thrived in all sorts of places largely with very little startup finance. From my experience, I think Sri Lanka, relative to other places, has the most number of entrepreneurial people on earth. If you go all over the world, you will find some Sri Lankan dude somewhere doing really cool things and highly successful. The question is that despite having creative and so naturally entrepreneurial people, why isn’t Sri Lanka like Hong Kong or the US? I think based on my own experience in three startups in completely different areas, what holds Sri Lanka back I believe is the State. If an entrepreneur wants to start a business he has to go through 50 different levels of bureaucracies. The State bureaucracies are very good at the top level, intelligent people sitting in Colombo, making good policies, but they are not implemented.
Fonterra Brands Sri Lanka and the Indian Sub-Continent Managing Director Sunil Sethi
if the core challenge is about transforming the country via entrepreneurship, it is important to nurture new and young entrepreneurship on a structured manner with all brainstorming on specific issues on a sector by sector. Wouldn’t it be good for the Government to identify the top issues for example in the agriculture sector or tourism and then go in search of some breakthrough disruptive ideas, be it from the millennials or new entrepreneurs?
HCP Consulting Ltd. Chairman/Principal Consultant Chaaminda Kumarasiri
We don’t have a coordinated ecosystem in the country to address idea generation. The experience factor matters but the youngsters want fast results. The problem is that how do we bring in the coaching and mentoring experience into the system in this backdrop? We have financing companies and various institutions, but during the process until they are stabilised there is no support.
YouLead Director Partnership Shehara de Silva
Apart from the structural issues of not having proper development finance institutes, etc. I think it is an issue about sparing 10% of quality time for real mentorship to encourage entrepreneurs.
Venture Frontier Lanka Co-Founder Ovidiu Bujorean
Venture Frontier Lanka has concrete solutions in terms of mentoring and providing support with our networks. One can find the most promising entrepreneurs that already exist, and organise a support system behind them.
There were 25 top leaders who came to support both our bootcamps in Colombo and Jaffna. We are making a big effort to bring the business expertise, practical expertise, academia, practitioners and global network. We are organising the entire ecosystem of finding the most promising entrepreneurs and matching them with the right local and global expertise.
There are a couple of other points. One is to support to go international. There is a specific focus of Venture Frontier Lanka on the ideation component, because we need to look at the type of ventures that can build products that can be easily exported. We will be launching a series of ideation in agriculture, leisure and tourism as well as logistics so that we bring about a new level of innovation in the nature of the ventures that are being built.
Secondly, we are building a single platform with Venture Frontier. In Kenya, they suggested that they wanted to co-fund by Nigeria. So from the initial start of the company, if you have a co-founded company from another huge market in Africa, you can actually start with two markets at the same time from the original design. So in Africa, we are looking at validating the potential cofounders for the ventures and connect with the strong diaspora on board to access some of the additional markets.
At the Venture Frontier Lanka we have a public-private donor partnership, where we have the support of the Government to work on the capacity building side, which includes national ideation celebration by the way to recognise the local role models who have been successful and distributed nationally. Ideation actually to work on different industries to come up and cross coordinate with very innovative ideas that are applicable to Sri Lanka, but we are also looking at the distribution model to make sure that a lot of people in Sri Lanka learn about this.
We are also looking at launching several disruptive initiatives specifically to support the human talent, entrepreneurs we are building. The idea is to bring private sector expertise too to market access, mentorship, work and provide anything. We believe there is very strong potential. If we identify the potential we can organise to a certain point locally, and then we provide the channels to grow it globally.
Leadership Group International President Jim Bagnola
We need to honour the knowledge the millennials already have. So as soon as they are hired, we should allow the millennials to go around the departments, and take new eyes and give recommendations so as to improve the existing business models.
They will feel good about it and consider themselves an internal consultant already. Believe me, these millennials are extremely knowledgeable. They can see things when we cannot see them. So it is just a matter of getting them involved and we listen to their recommendations. We implement some, and we tell them why others cannot be implemented. So the key phrase is ‘every person I meet regardless of age, is superior to me in some way and I learn through that’. So, I want to learn from you and then I want to teach you because I went on that path already; so I will teach you what I know, but I am open to learn from you to make this task better. It is just one thing to start with.