Home' Forge : Vol 1 No 2 Contents INSIGHT // 23
bigger than in Australia, and is
also now bigger than in the United
States market. So, any product that
needs a smart phone is going to be
insanely huge, if you just focus on
South-East Asia. Things like apps
to order food, book taxis, listen
to music or chat to friends... the
opportunities are endless.
It is estimated that every year in
[South-East Asia], 15-25 million
people move from lower class
to middle class. Every year, the
market grows by the size of the
entire Australian market. These
are people who need property,
cars, education and entertainment.
That’s why we love our companies
that focus on online property and
online cars; our markets just keep
growing every year.
Forge: Why has Australian business,
generally, been slow to capitalise on
the Asian century relative to United
States and European companies?
PG: To Australia’s credit, I think it is
doing all right. I see more and more
Australians looking at Asia, coming
to Asia and living in Asia. At the
end of the day, to be part of the
‘Asian century’ you have to be here,
and not think about it or read about
it from 3000 miles away.
Forge: How do you see Asia
changing in the next 10 years?
PG: It will keep growing, and with
so many people joining the middle
class every year, pretty much any
business you start is going to grow.
I’ve seen friends open a bar as a
hobby, and 10 years later they have
20 bars and a hotel. The market is
growing while you sleep, so there is
a huge wave that people can ride.
Forge: What advice would you give
an entrepreneur who wants to start
a venture to focus on Asia?
PG: Figure out an edge, never give
up, get on a plane, and be here.
Nike says it best: ‘Just Do It!’
Forge: What are some of the biggest
potential traps in starting and
running new ventures in Asia?
PG: There is no quick money. You
have to be in it for the long haul.
We started Catcha in 1999 – that’s
16 years ago. We lost money (a lot)
for the first seven years. Not many
people would stick it out that long.
I’ve never seen anyone thinking,
‘I’m going to do the Asian thing
for two years, make a lot of money
and go back,’ actually do well.
Those who stuck it out, the ups and
downs, actually created something
Forge: Have you had any failures in
Asia and, if so, what did you learn
PG: We had an e-commerce site
focused on luxury handbags that
grew very fast, then flatlined, and
eventually ran out of funding. We
felt we did a lot of things right. We
were very strong on technology,
online marketing and fundraising,
but we realised that ‘merchandising’
was the key driver to success – and
nobody on the senior team was
strong at merchandising. So, learn
what trait or expertise is the key
driver of success, and make sure
your chief executive officer and
leadership team is strong in that.
Forge: You describe your business
as being involved in technology
‘arbitrage’ – taking good ideas from
the West and implementing them
in the East. How does that model
work, and what are the main factors
needed for it to succeed?
PG: It’s the oldest business model in
the world: seeing what works in one
place, and doing it somewhere else.
We love this model, as it minimises
risk tremendously, because if we
execute correctly, there is very little
risk of no demand for what we
launch. If you play the technology
innovation game, you are launching
something you don’t know people
will actually want or need.
We’ve realised that we are never
going to invent Facebook, but we
have developed an ability to spot
what worked well in other markets,
and can work well in our markets
while building a moat around the
business. We’ve also learnt that it is
not just simply ‘copy anything you
see’. There is a lot of science that we
employ to determine what business
models to use as a starting point,
and then ‘Asian-ise’ them for the
iProperty is a great example. We
knew that Asians were property-
crazy, and would eventually warm
to the internet, but we tweaked
the model dramatically to focus on
developers first and agents second,
whereas in the West it is the reverse
Forge: Why did Catcha launch the
video-on-demand service, iFlix?
PG: We knew that companies
like Netflix and Hulu were doing
very, very well, and we were
huge believers in the Asian smart
phone revolution. We put the two
together, and realised that there
was a huge opportunity to power
the entertainment experience on
250 million smart phones in the region.
Nobody was doing it, and we think
it will be a while before anyone
seriously tries to do it. We’ve
raised US$30 million from great
investors to build the business, so
it’s all systems go. We genuinely
believe we are at the forefront of
an entertainment revolution in the
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