SELF-MADE MILLIONAIRE SHARES HIS SUCCESS FORMULA

Mr. Andy Ong, is a well-known figure in the financial industry. The former President of the Financial Planning Association of Singapore made his first million when he was only 26. He shares his success formula and offers some valuable tips to aspiring investors and entrepreneurs.

Vasu
You made your first million at 26. What drove you to succeed?

Mr. Ong
I grew up in a single parent family, and with five kids competing for limited money, life was tough in my early years. I attended some of the better schools in Singapore and I felt out of place as many of my classmates came from well to do families and didn’t have to struggle and enjoyed a good life. On the other hand, I couldn’t depend on handouts from my parents to enjoy a better life. I knew that I had to work hard and be resourceful. My desire for a better life created a strong hunger within me to succeed.

I started work at the age of 15, cooking in some of the best restaurants in Singapore and earned my keep at a young age. I was driven to start my own business after working for a couple of years as a financial journalist. I was very fortunate as my job allowed me to learn from the top minds in the industry, in areas such as wealth creation and wealth and risk management, I was among the first few to attain the Certified Financial Planner accreditation and was fortunate to be the Founding President of the Financial Planning Association of Singapore. This curiosity to break into new fields provided me opportunities to create new business entities.

Vasu
You are the best-selling author of books on financial planning and investments. What financial planning and investment tips can you offer our readers?

Mr. Ong
I am lucky to be the best-selling author for 7 books that sold more than 140,000 copies in the region. My first book which I wrote at the age of 25 was a mega best seller spending over 20 weeks at the best sellers list. I came into the market at the right time as the art of effective personal finance was not taught in schools and many people were curious and they bought my books. I subscribe to 3 key philosophies in my business and personal financial life.

• Look at the risks first before you look at returns. If you manage the downside, the upside will take care of itself.
• Look for positive cash flow opportunities. Paper profits can be engineered but cash flow is real.
• There are no get rich quick schemes! If you know what you are doing, you can make a lot of money and you must look at the grand scheme of things.

Vasu
Today you run a multi-million dollar company, ERC Holdings, which provides budding entrepreneurs with training, funding and mentoring. What are the key factors required for a successful entrepreneur?

Mr.Ong
ERC was formed by a group of leading entrepreneurs in Asia to provide a platform to help aspiring entrepreneurs. Many people think that you need a lot of money to start a business. This is not entirely true. Even if you have very little money, you can still succeed as an entrepreneur, provided you are equipped with the right skills and mindset. It is important to try to avoid the general mistakes already made by previous entrepreneurs. We try to share with prospective entrepreneurs during our seminars what mistakes we made and hope they can avoid them. Everyone has what it takes to start their own business. It is just the matter of bringing out the entrepreneurial spirit in them. We can teach almost everything possible under the sun but we cannot teach hunger.

Vasu
Looking at your personal investments, how large is your portfolio and how is it managed?

Mr. Ong
My portfolio is substantial and part of it contains some Singapore stocks. As I am busy with my day-to-day work, I leave it largely to people with the expertise and knowledge to manage my portfolio. When I was writing a book on investing in unit trusts in Singapore, I was very fortunate to meet some of the best fund managers here. It is clear to me that a consistent investment philosophy is important and I entrust my money to these people as it is their core competency to manage money.

Vasu
REITs (Real Estate Investment Trusts) have grown in popularity here, Have you invested in them and do you reckon that they offer an attractive investment proposition?

Mr. Ong
REITs are effectively dividend plays that have grown in popularity here for those who are interested in enjoying a constant stream of income. I am still in the wealth creation stage and I am more interested in growing my wealth instead of having a constant stream of income. As such, REITs so no meet my investment objective for now.

Vasu
Are there any Singapore stocks you have bought and made significant gains on? What kind of gains have you enjoyed on these stocks and what led you to buy them?

Mr.Ong
One Singapore stock which I bought and made significant gains on is Apex-Pal International. In terms of capital upside, I have more than doubled my money. In addition, I have also been receiving a constant 3 to 5 per cent dividend payout each year. I am a director of the company and I have faith the current management team will be able to bring the company to new heights. I believe in its long-term potential and the founder’s way of managing the business. All companies need the entrepreneurial element and the hunger to succeed in order to thrive in the future. The management of Apex-Pal International has these attributes and they are focused on enhancing the value for shareholders.

Vasu
Everyone makes mistakes from time to time. Have any of your investments turned sour? Are there lessons which you have learnt that you can share with our readers?

Mr. Ong
Some people tell you that they have never made mistakes but it is difficult to believe them. I have made so many mistakes that it is not even funny anymore. Wisdom is accumulated through making mistakes. In fact, you accumulate more wisdom through making mistakes than by only achieving success.

My first foray into the stock market was at the age of 21. I bought the warrants of a company called Singmarine. I doubled my money in the first week but by end of the first year, I am down by several thousand of dollars – at that time, it was a huge amount of money for an undergraduate. It was a painful lesson and it made me realise that I should not be dabbing in an investment where I had little knowledge about.

Vasu
You have done well as an investor, entrepreneur and CEO. In your view, what does it take to be a successful entrepreneur? Do you have a role model when it comes to investing? Are there any other CEOs that you admire?

Mr. Ong
To be a successful investor, it takes a vision and preparedness to take calculated risks to achieve what you want from your portfolio. I truly admire Warren Buffet and share his investment philosophy. I also admire his abilities as CEO in picking the right kind of companies to acquire.

Another person I admire is Jack Welch, the former CEO of General Electric. His management philosophies are amazing and will deliver true value to shareholders over a longer period of time. I particularly agree with his “20-70-10” rule which aims identify the top 20 per cent, middle 70 per cent and 10 per cent of a company’s staff. The bottom 10 per cent comprise of underperformers who ought to be fired. In a world where change is the only constant, a company and its staff must be kept on their toes.

Vasu
Tell us more about the person behind Andy Ong. What are your hobbies and what do you indulge in to de-stress?

Mr. Ong
My hobby is turning companies around. I know that may sound unusual but the intense satisfaction I derive from it is addictive.

I de-stress by playing golf occasionally. I lead a very hectic life and I am constantly hurrying from one meeting to another. To me, golf is a form of “meditation” where I can calm my mind and just shut off for a while. I also try to take a short break once every quarter to maintain some level of sanity.

As for work-life balance, I am not a role model at this point of life as I am still committed to my work. My work is helping aspiring entrepreneurs achieve their objectives is extremely rewarding.


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Article By: Vasu Menon, Chief Editor

Pulses
June 2007


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