Seek purpose, not dollars – entrepreneur

02 April 2012

Entrepreneurs should avoid starting businesses just for the money, says one of New Zealand’s youngest and most successful entrepreneurs.

Derek Handley was the guest speaker at the first of the Spark Vision 2 Business series last week, giving his views on the ideal entrepreneurial mindset to a room full of budding entrepreneurs at the Business School.

The New York-based entrepreneur told them to examine their reasons for starting a business, saying their reasons needed to be strong and robust because one of the worst reasons to go into entrepreneurship is to do it solely for the money.

“You have an opportunity to start something and you have to think hard about the impact it will have. There are lots of problems in the world and we need to apply the entrepreneurial mindset to solve them,” Derek says.

Using examples from his own entrepreneurial journey, which began when he was a 14-year-old schoolboy selling things through the Trade and Exchange newspaper, Derek explained the importance of having a solid personal filter and an understanding of the market landscape, especially when things don’t go to plan.

He told the story behind The Hyperfactory, a company he co-founded in 2001 with his brother, Geoffrey, to create an industry using mobile phones as an advertising medium. The business was highly successful so the brothers eventually moved to New York, where they expanded the global empire and recruited more than 100 staff in offices around the world.

“The key to The Hyperfactory’s success was vision and strong values for what we wanted to achieve. You have to look at your personal filter when you go in and ask yourself what you want out of it.”

He encouraged the young entrepreneurs to become experts in their areas by being there at the beginning when trends emerge. They need to do lots of reading until they can understand the landscape of their chosen market and where growth and momentum are headed.

From there the challenge is to come up with ideas that can get off the ground in a market bubbling with activity and plenty of growth opportunities. Without this type of environment, he says, it can be difficult to get a venture off the ground.

“I pretty much covered my walls with brown paper and chucked a whole lot of ideas at them, then narrowed them all down to an idea on one A4 page with the market, business model, how much I wanted and what I was going to do with it.

“Being an entrepreneur is all about passion and purpose.”

At the age of 22, Derek became New Zealand’s youngest managing director of a listed company when he led Feverpitch to list on the New Zealand Stock Exchange.

That business later foundered but he went on to create several start-ups including The Hyperfactory, which sold to US media giant Meredith Corporation in 2010 in a multi-million dollar deal.

The accolades have rolled in since Derek was listed among the 40 most influential people in New Zealand telecommunications in 2005 and became the Ernst & Young’s Young Entrepreneur of the Year in 2009. Last year he was named one of the Sir Peter Blake Trust Leaders and continues to mentor and invest in young entrepreneurs.

The Spark Vision 2 Business series is held on Tuesday evenings at the Business School and teaches the basics of building a business. The series is hosted by Dr Chris Woods and Dr Deb Shepherd, facilitators of The ICEHOUSE Owner Manager Programme, and offers sessions on pursuing opportunities, building an entrepreneurial team, understanding business models and creating business plans.