Why Aggressively Investing Even In Hard Times Is One Entrepreneur’s Secret To Success

Why Aggressively Investing Even In Hard Times Is One Entrepreneur’s Secret To Success

MAX NISEN SEP. 24, 2013, 10:57 AM 1,463 1

Anthony Buonocore bought Westway Electrical Supply, an Upper Darby, Pa.-based supplier for electricians, at exactly the wrong time. It was 2008, the beginning of the financial crisis, and businesses around the country were pulling back or shutting down. “I had to make a decision: Either try to hunker down and save cash or spend what little cash was left to grow the business, despite the recession,” Buonocore says. Rather than stepping back, he invested heavily in a new website and strategy that dramatically boosted the company’s online presence and search ranking.

He was following the best business advice he’d ever gotten: If you’re not growing, you’re dying.

“I received this advice when I was just getting into business, and I had delusions of owning small businesses that ran themselves while I was on the golf course,” Buonocore says. “The truth is that a business’ income streams are constantly at risk.”

There’s nothing like a financial crisis to drive that advice home. Small-business owners don’t have the luxury of getting complacent.

“It is impossible to foresee every possible threat to your revenue streams, and eventually something is going to happen that will reduce or eliminate one of those sources,” Buonocore says. “It’s critical for the business owner to continuously search for new sources of revenue — not just to grow the business, but to hedge against the loss of any old income streams.”

It meant some lean times. Buonocore went without salary for 18 months after buying the company, but it ended up saving the business.

With the improved site, and an emphasis on quick processing and customer service, the company’s online sales are up 38% from when he first took over, and around 250,000 products are available online.

His decision to invest even in hard times also came out of an earlier failure, when he ignored that great piece of advice. Buonocore calls it his “greatest regret in business.”

“The first business that I owned was a laundromat, and my intention was to passively manage the business as an absentee owner,” Buonocore says. “Over the years I slowly lost customers, and because I was not aggressively trying to bring in new customers, the business became less profitable each year. I eventually had to sell the business at a loss.”

If he had chosen to play it safe and rely on the business that had worked in the past, Westway might have gone the same way as that failed laundromat. Instead, the business is thriving.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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