By G. Sharmila
Previously, REDtone International Bhd co-founder Wei Chuan Beng spoke about how he and his ex-classmate founded the company, the problems they ran into and how they reinvented the company in troubled times. Here, he talks about REDtone’s venture into the Internet of Things space and the other plans he has for the company.
________________________________________________________________________
According to REDtone co-founder and managing director Wei Chuan Beng, for the past two years, the company has been readying itself for the Internet of Things (IoT) “because that is the future”
(Webopedia.com defines the IoT as an ever-growing network of physical objects that feature an IP address for Internet connectivity, and the communication that occurs between these objects and other Internet-enabled devices and systems.) One example of the IoT is Smart Things, a company recently acquired by Samsung that sells sensors and smart home kits which monitor various things, such as who is coming in and out of your home.
In early August, REDtone launched its first IoT application called CitiAct, which is a mobile application that allows members of the public to engage with local councils. For example, the public can report things like illegal parking, crime and other incidents relevant to community well-being via the CitiAct application.
Why did REDtone go into the IoT space? According to Wei, the Internet for people will come to a point of saturation within the next five years or so as most people are already connected.
“However, there are a lot more things that are yet to be connected such as cars, lights, refrigerators and watches. If you think of industries, let’s say the healthcare industry, in the future you don’t just depend on the diagnosis in hospitals; various devices can be strapped to a person’s wrists, legs or forehead which will capture information and communicate with a server which would then make an extrapolation of the state of a person’s health.
“The service would involve collecting data, knowing what’s happening and making informed decisions. This is the biggest benefit of the IoT. Transportation is going to be a big thing because when you talk about driverless cars, they use the IoT to operate sensors and obtain feedback. I believe utilities will be big as well,” Wei explained.
He added that REDtone wants to work on smart cities. “We believe that the foundation, the platform that we have developed in-house is well equipped for us to extend the kind of linkages and data collection from different parts of the city; from pollution to transportation to safety to living conditions and utilities.
“The IoT helps to optimise all the different parameters and also helps the planners to make better decisions and regulators to have better enforcement of city regulations. I think we want to play a role which would enable all these linkages to lead to a better city and a better world. So that’s the IoT,” he said.
“Along all this, we find that we no longer just want to focus on infrastructure. While infrastructure is a good foundation, we must have strong value add. One other important area will be cloud services which we will launch in about a month or two,” he added.
Would he count the IoT as the fastest-growing segment of the business? “The IoT is from zero base and everything from zero will appear to be fast growing. What we certainly see is this: our value-added services – radiology, IoT and cloud – will be mainstream for REDtone three to five years down the road,” Wei said.
He noted that REDtone has experienced a significant corporate evolution. “As a company we have grown from the early stage when we were a startup with our own capital. Then our ‘angel’ friends came in to invest, and after that venture capital came in to invest, followed by PPB Group coming in as a corporate investor and finally we listed the company,” he explained.
“After the initial public offering, we also saw the exit of some shareholders; subsequently we funded our business by issuing warrants and we have seen some expansion since. We saw institutional shareholders coming in and out at different times based on their investment appetite, and additional investors that came in were the Berjaya Group and the Johor Sultan.
“A few months ago, Berjaya made a full general offer and from that exercise it had acquired a majority stake in the company. REDtone is now officially a subsidiary of Berjaya which has more than 50% and the Johor Sultan has about 18%,” he explained.
Last year was the third consecutive year of profits for REDtone. According to REDtone’s 2014 annual report, it recorded a revenue of RM141.76 million for 2014, 0.19% lower compared to RM142 million in 2013. Profit before tax was RM27.42 million compared to 2013’s RM33.66 million.
The company said that if it weren’t for delays in some projects which were supposed to be completed in 2014, it would have posted better revenue and profit in 2014. The projects’ earnings contributions will be recognised in financial year 2015, the company said.
How does he expect the company to perform this year with the challenging global economic environment? The challenging environment is related to oversupply, which the company has successfully avoided, Wei said.
“We have real solutions that address the needs of companies and industries such as healthcare and the local government. Through the success of our IoT solutions, I am cautiously optimistic that we could have another year of reasonable growth as our new value-added services are showing results,” he said.
On being an entrepreneur, Wei said that being a member of the Young Presidents’ Organisation (YPO) has helped him in his journey as an entrepreneur. “The YPO supports peer-to-peer learning and I am very happy to say that without the YPO, I would not be where I am today.
“It has a system that allows you to learn in a safe and trusting environment along with your peers. This has helped me to equip and enrich myself in my areas of business, and has facilitated my personal development and the well-being of my family,” he said.
How would he advise entrepreneurs who are just starting out? “I have a friend who was a human resource director for one of the top multinational companies, and he found that in multinational corporations that only hire top students across institutions, believing that they are the brightest and most talented, after 10 years of working with the company, these people are content but unhappy.
“They often find that they have good jobs and high salaries. They can buy a car and a house and then get a promotion after three years, get a bigger car, bigger house… another seven years go by and they get into middle management and another bigger car and house,” Wei explained.
He added that although these people live in the comfort of five-star travelling and environment, when they try to move out of that environment to try something that they are passionate about, they will find that they cannot afford to take the risk.
“So my advice to be an entrepreneur is first of all to live an affordable lifestyle. For young people these days, before they could generate income, they want to spend a lot more than what they can make, because they think lifestyle is more important. Even worse, they begin to get into long-term commitments like cars and homes, and these give them no room to manoeuvre in their lives,” he explained.
“So if you can manage not be too hung up about what other people wear, what they drive, what kind of a house they live in, but be yourself, acquire knowledge, live an affordable lifestyle, and build your core competencies, when the opportunity comes you can seize that.
“If you are prepared – that means you have some savings, you have knowledge, you have competencies – then when the window of opportunity presents itself you can seize that when other people can’t. This is how they can get into some initial traction and build their success from there,” Wei concluded.
Yesterday: Taking REDtone regional
You must be logged in to post a comment.