Maestro's ongoing journey
The Edge - February 2, 2009
By Karamjit Singh
courtesy of The Edge
Azreen Latiff and Aris Samad-Yahaya
are two entrepreneurs who do not
believe the market or the government owes them a living. Their six-
year entrepreneurial journey has also
dispelled the notion that bumiputera entrepreneurs have it easier in this country.
For the duo, who were initially focused on
their supply-chain software, their journey into
the education market via their school management system happened by accident, as it
so often does with entrepreneurs.
Out of helping their alma mater was born
QuickSchools (www.QuickSchools.com), an
online school management system that runs
on the ASP (application service provider)
model, which has helped them gain traction
in the US market.
"We made a mistake in the first two years
of focusing on the Malaysian market," says
Azreen. "Not only is the private school market too small - with about 130 schools -
but it is also tough to convince them of the value of our software."
Hence, their brave foray into the US market, which has around 33,000 private schools.
Their company Maestro Solutions has two full-
time empLoyees there, helping them make inroads into the country. Azreen was there for
a month recently and is about to leave for another month.
Aris and he are working on the final stage
of securing venture capital, which will go
some way towards the RMS.7 million they
need to improve their software, the business
strategy of which they modelled after Google's.
Indeed they even allow you to use a free
version for three months, complete with 24-
hour client support. Talk about having confidence in your product.
The two men are impressive, driven, competent and honest.
"We've worked tremendously hard over these years to build a reputation
as an honest, competent and technologically
advanced company," says Aris.
They hope this will be the year they make
In the following Q&A, Aris and Azreen share
their journey so far and the lessons learnt.
What is the latest with Maestro Solutions?
As we indicated in our last interview with The
Edge (Oct 1, 2007), we have fully launched
QuickSchools.com which is an online school
management system. In the US, we recently
concluded our first public launch, where we
made a strong impression at the Conference
of Independent and Religious Schools in Albany, New York, on Nov 17 and 18.
The interest level was very high and over the last
few weeks, we have brought on board more
than eight schools in the US and two schools
in the UK.
Why were you not successful with your
initial supply-chain solution and what lessons have you learnt as entrepreneurs from
I think we are experiencing very encouraging
success with the supply-chain business. We’ve
registered growth year on year and we foresee
the business growing further. The only issue
that limits growth is the market size of the various industries we are in. We are in very select
industries which have only a handful of companies. Thus, to grow on the back of expenence
was hard as we could not leverage know-how
immediately to the next customer. Of course,
there were many lessons which were transferable but there was very little scope for us
to be dominant in any single vertical, as each
vertical was too small.
When we won Venture 2002, this is what
the judging panel had to say of our idea: "Not just a business idea. Marks a real breakthrough
involving use of a new algorithm that is fascinating." (The Edge, Jan 20, 2003)
Unfortunately, or in hindsight very fortunately, we learnt
that there is a big gap between having a good
idea and the potential to make money and actually making money.
Despite all the venture capital interest at the
time, all we ended up with was RM25,000 in
prize money and that was it. We decided that
we had to take control of our destiny and not
get caught up in the venture capital hype of
the time. Of the RM25,000 prize money, we rewarded ourselves with RM6,000 for the effort
put in to win Venture 2002, and poured the
balance RM19,000 into Maestro Solutions. In
five years, we have learnt how to grow a million-dollar business with zero debt.
We have been profitable every year since
year two. We have designed and created optimalOne, which is probably one of the world's
best Web2.0 platforms, and we have real customers paying us real money to do real work.
The real lesson is that to be successful in
business, there are some fundamentals that
must be mastered. These fundamentals do not
exist in the business per se, but in the business of the business.
We are today, as entrepreneurs, so different in mindset and thinking about success as compared to where we
were in 2002. It has been a painful but rewarding growth experience.
While you want to target the US market,
among others, many Malaysian entrepreneurs have lost money in trying to develop a market in that country.
Why do you think you can be successful?
Not only have many Malaysian entrepreneurs
failed in the US, even US-based entrepreneurs
fail in the US and that is an absolute fact.
Anyway, the reality is that just as many Malaysian entrepreneurs fail in Malaysia.
The real question is, what separates success
from failure? We have spent a good three years
studying this and let me share our thoughts on what we have learnt:
- The first "success" metric we imposed
on ourselves was that we had to reinvent
ourselves from being technopreneurs to business people. We had to get away from
the seduction of technology to the reality
of business that is underpinned by cash
flow, growth and profitability. We think we
have succeeded agalnst this metric based
on Maestro’s five-year track record.
- The second "success" metric is that to be
big in the Internet era, we have to find a
black swan* and this black swan has to
meet three criteria: (i) Make a massively complex problem simple. If we look
at Google, they have made the massively
complex problem of searching for information on the Internet so simple for the end
user. Just type your search in the box and presto, high-quality results come
out: (ii) Sell it for a ridiculously
low price. Again using Google,
they have made it ridiculously
low priced - they gave it away
free: (iii) Give it "infinite" scalability. Again sticking with Google, they have infinite scalability
- anyone who connects to the
Internet gets to use Google. We
really believe QuickSchools.com
meets all of the above criteria.
- The third "success" metric is
that to be truly successful, this
black swan must succeed in the
US and for this, we turned to the
heart of all success - "unique
experience." And our positioning
is simplicity. We ensure that at
every touch point, prospects and
customers experience simplicity
- "Wow, this is so easy."
We have taken QuickSchools.com to the US and in every presentation we have made, we got the
same response - "Wow, this is so
easy." We have had customers who
ditched the market-leading system
in the world for ours. Even schools
with no school management system
exposure signed up.
Right now, all indications are
good. At our big conference in Albany, New York, we had the opportunity to present to over 500 school
administrators and the response was
exactly the same.
How much mnoney are you going to
need to further develop the school
scheduling solutions and how do
you plan to raise it?
We need RM5.7 million over the next
two years to bring the business to
an exciting level. We target QuickSchools.com to have 572 schools by
the end of year three. The reality is
that the window of opportunity is
closing fast. Currently, there is no
clear market leader in the online
school management space, but in
less than 24 months, we anticipate
that there will be clear candidates
for the market leader position. The
only way for us now is to actually
raise the capital needed to give this
business a real chance at succeeding. The opportunity must he given
the fair chance it deserves.
Of the RM5.7 million, we expect
to invest a further RM2.5 million to
advance the scheduling algorithm.
We have applied to Multimedia Development Corp for the MGS grant
and we hope to receive a favourable response from them soon.
Is your solution going to be entirely open source-based or a mixture? Why choose this option?
We use the best components available at any point in time that works to
our advantage. Sometimes, it's open
source, sometimes it's paid. We've
chosen this option mainly because
it's the best plan for us. Software is
really a function of skill, experience
and in some ways, luck!
The reality is that the open source
enterprise components are so advanced now and can really give
the big boys a run for their money.
Open source components, like JBoss
and Postgres, are highly regarded
in the software world and can hold
How would vou assess the environment today for entrepreneurs
in Malavsia than when you started out?
There is always opportunity to be
exploited by the entrepreneur. It’s a
combination of talent, alot of hard
work and of course, luck (again).
We've always believed that the world
doesn't owe us a living and we've
been blessed with the breaks that
came our way but believe you me,
there were many, many events which
went against us throughout the six
years. We’ve worked tremendously
hard over these years to build a reputation as an honest, competent and
technologically advanced company.
The Maestro treatment and covenant
we give to our customers is that at
the end of the day, they should know
that we’ll solve it!
What is the single biggest thing the
government should do that you believe will help emerging entrepreneurs the most?
We feel the government has done so
much for tech companies under the
MSC initiative, We've even heard that
the government can create customisable incentives to help companies
grow further. We don't know what
more the government can do. At the
end of the day, businesses will have
to learn how to compete and operate sustainablv. It's something that
we're learning as well. On the other hand, the local market has been
burnt numerous times by failed IT
implementation by local companies.
As a result, local companies often opt to choose foreign brands as a
safe option. As a software company, we really can't blame the customers for choosing foreign brands
under the circumstances, It will necessarily take time to repair such an
impression and we hope to continue
to change the perception one company at a time.
* The Black Swan theory (in Nassim Nicholas Taleb's version) refers to a
large impact, hard-to-predict and rare
event beyond the realm of normal expectations (http://en. wikipedia.org/wiki/Black_swan_theory)