Unicorn CEO Johnny Shih
Lesson Learned: Talent Trumps All
Like many young Taiwanese entrepreneurs, this CEO of a men’s skin care company had to break out of his shell to find his way and now hopes to create an environment in Taiwan that values talent more highly and dares to reach out into the world.
Lesson Learned: Talent Trumps AllBy Hsiang-yi Chang, Sun Guo, Zi-wen Wang
Just one minute left before the scheduled interview. Crossing reporters are still searching for the office of the Unicorn team located in startup accelerator AppWorks’ facility when we see the company’s founder dressed in blue jeans and a black T-shirt printed with a bright yellow “U” strolling toward us to introduce himself.
“Hi. I’m Johnny,” he says. Though he seems like the boy next door, he has had the courage to take on social issues and venture into international markets, a vision that delivered over NT$10 million in sales in his company’s first year. He is Johnny Shih (施凱鈞), the co-founder and CEO of Unicorn.
Unicorn has emerged in Taiwan over the past two years as a top men’s skin care brand. Beyond its range of more conventional facial lotions and grooming items, Unicorn developed the world’s first “buttocks lift mask” that has proven a hit in the gay community, highlighting the spirit Shih wants the brand to convey – “dare to be different.”
During our interview, the phrase Shih repeatedly turned to was: “Let me tell you a story.” He excels at breaking down complex business concepts into plain language, reflecting his talkative personality and desire to share.
In October 2016, Shih successfully interviewed with American seed fund and startup accelerator 500 Startups to get Unicorn into its seed program, seizing one of 44 spots in the program’s “Batch 19” from among 2,000 applicants around the world.
Vision: Getting It Right from Day One
Shih returned to Taiwan from Silicon Valley at the beginning of March 2017 after completing his fundraising plan and shared his observations after spending over a month in the United States.
“What I learned about more than anything was the vision, mindset and foresight that entrepreneurs should have,” Shih says.
“For example, many startup teams in Taiwan often feel they should develop the local market first and then go global. But right now, international entrepreneurial trends show that startups don’t necessarily have to think like that.”
Shih explains that new enterprises today typically use e-commerce as their main distribution channel, enabling them to operate beyond a single geographic market.
“That’s not to say that the local market isn’t important. It’s just that even if we’ve started up a business in Taiwan, do we entrepreneurs have the foresight and vision to replicate our model for the same products and services overseas?” he says.
Before participating in the 500 Startups program, Shih believed that companies needed to reach a certain scale and that Taiwan needed to be the top priority before contemplating expanding overseas. But in today’s e-commerce era, cross-border logistics and payment services in many global markets are far more convenient than in the past, and companies can quickly test reaction to their products in foreign markets for only a minimal marketing expense.
“If your product isn’t selling well in Taiwan but is drawing a great response in Vietnam, Indonesia and Myanmar, would you really not think about giving those markets a try?” Shih says.
He believes Taiwan offers an ideal environment for testing business models but says Taiwan’s entrepreneurs need to have the courage and insight to extend their own brands into the world. “People shouldn’t scare themselves off before even giving it a try,” he insists.
The Right Mindset
One of the big lessons Shih learned during his time in the United States was about the mindset entrepreneurs need to succeed.
“A lot of people think their English isn’t good enough, so they don’t want to go,” Shih says, admitting that he was once one of them. Having graduated from Yuan Ze University with a degree in chemical engineering and materials science, he says his English skills left plenty to be desired, but he still was willing to give a briefing in English in front of nearly 200 venture capitalists and angel investors at the 500 Startups program.
“I had no choice. The founder is the team’s ceiling. You have to constantly push yourself to get better if you want to create opportunities for your team and company,” Shih says, recalling that he spent a lot of time working on his pitch, infusing it with his own brand of humor and interesting body language, to successfully attract the interest of potential investors on the 500 Startups’ Demo Day. He has already signed an agreement with one angel investor, helping Unicorn’s value exceed NT$100 million.
Beyond his visible successes, Shih also expended a huge amount of effort behind the scenes.
“Whether with a 500 Startups mentor or VC, whenever they had time I would pitch my product to them,” Shih says, explaining his philosophy of never missing an opportunity.
Even if he wasn’t scheduled for a one-on-one meeting with a venture capitalist, “I would still use the time between venture capitalists’ meetings with other teams or during changes of venue to get in a quick chat and exchange name cards,” Shih says, recalling his eagerness to knock on every door to get an interview with potential investors.
On Demo Day, Shih delivered a knockout pitch that stunned his audience. What inspired it?
“Well, I have to admit, I probably put together more than 10 versions of my pitch,” Shih says with a laugh. He first memorized each pitch and then asked other startup teams in his group for their opinions that informed changes and more practice time.
Beyond that, “500 Startups has other CEOs introduce your company from their perspective,” Shih says, a system that he believes provides valuable training.
“Everybody has blind spots, like an entrepreneur may think that certain features of his company are very important. But they may not be such a big deal from the perspective of entrepreneurs in other fields or venture capitalists. At the same time, entrepreneurs can understand what other teams are doing through their pitches.”
So when other CEOs gave demonstrations, Shih’s Unicorn team filmed them and made them into a video to study and help fine-tune their own presentation.
“Silicon Valley is just a place. What’s really important are the people,” Shih stresses.
Silicon Valley is the world’s leading hub of innovation not only because of its abundance of prominent high-tech companies and venture capital funds, he says, but mainly because it brings together people who are eager to share and believe they can work with others and make the world a better place. The result is a startup environment full of positive energy.
The Mature Mindset: How Can I Help You?
In contrast, when Taiwanese startup teams give each other advice, it’s usually “humble and courteous,” Shih has observed, with teams either unwilling to give direct criticism that could “offend” others or worried they lack expertise in the given field and aren’t qualified to give advice. Consequently, they tend not to offer feedback that reflects what they really think. As for new startup teams involved in similar endeavors, they often erect barriers between each other to keep their thoughts to themselves, afraid that if they let a good idea out, others will copy it, Shih says.
“But time is precious,” he says, reflecting the mentality of entrepreneurs in Silicon Valley, observing that most of them adopt the mindset of: “How can I help you? What can I do to help?”
They have no reservations about expressing their ideas to help people find ways to solve problems together, Shih observes.
“That’s because people there generally understand that everybody has ideas, and that executing an idea and meeting the challenges of the marketplace are the real keys to success or failure,” Shih says.
As for sharing, the Unicorn CEO believes that beyond candid exchanges of suggestions, sharing failure is also extremely important.
“There’s no guarantee of success when starting a business, but if you share the mistakes you’ve made, that may be even more valuable than sharing a success story,” he says.
Talent the Top Priority
Even after experiencing the best startup environment in the world, and seeing his business running smoothly after operating for more than two years and now ready to enter its next phase, Shih is not down on Taiwan.
In his own chemical products sector, for instance, Shih believes that Taiwan still has major advantages in manufacturing, with many factories having spent years working with such prestigious global brands as L’Oreal, P&G, and Japanese chemical company Kao Corporation.
They possess world-class production technologies, and the majority of them have international quality management certification, such as the current good manufacturing practices (cGMP) used in the pharmaceutical and biotechnology spheres. Products made by companies with cGMP certification can be sold in the European market.
In addition, as Taiwan continues to upgrade its industrial technology, many manufacturers are able to adjust their production lines and capacities to satisfy the “high-mix, low-volume” trend favored by today’s consumers.
Another major advantage is the gradual formation of entrepreneurial communities. Incubators and accelerators such as AppWorks, NTU Garage (link in Chinese) and ALPHA Camp are slowly connecting talent, matchmaking startup teams from different fields.
But Shih objects to another advantage often cited by entrepreneurs and businesspeople: the high “CP” value of Taiwanese talent, referring to the relatively high performance of local talent at a competitive cost.
“I really think this is a bizarre phenomenon. The low salary level in Taiwan is something that needs to be changed, but domestic companies or overseas startups still come here because of this, even to the present day,” Shih says.
He believes Taiwan’s startups have the responsibility to be at the forefront of change by de-emphasizing the importance of keeping steady or lowering the “C” value (costs) and instead using the “P” value (performance) to increase services and promote products overseas to create greater value.
The high priority Shih puts on nurturing talent is evident in his approach to interns. “I don’t think the effort made by interns should be treated cheaply,” he says. “There’s no doubt that all company owners to some extent pay the costs of learning of their employees (or interns), but these associates invest their youth, and it seems to me every individual’s effort should be reasonably rewarded.”
Objecting to what he sees as Taiwan’s unreasonably low salary structure or the use of unpaid interns by many prominent companies, Shih has put his money where his mouth is, paying interns and younger employees above the going market rate.
“How can you live with having people who are following you go hungry?” he says matter-of-factly.
Unicorn Skincare CEO Johnny Shih (standing) and his startup team have an office in a facility run by startup accelerator AppWorks.
Willing to invest in his employees internally, Shih is also eager to participate in social causes externally.
Unicorn’s body care products have earned widespread praise in the gay community for more than just because of how the company’s products are positioned. The brand has also won acclaim because of Shih’s outreach in the community trying to better understand what his target clientele wants and his willingness to take a stand on timely social issues.
To get a feel for his target customers’ needs, he regularly chats with gay friends to uncover unresolved “pain points,” learning for example that for gay men, “their buttocks is their second face.” He also holds focus groups of four to five people at a time, and has gotten the opinions of nearly 100 people that way. He may even rent a theater and invite Unicorn supporters to watch a movie and enjoy some ice cream to deepen the company’s interaction with consumers and hear their real voices and feedback.
Shih’s vision, however, extends beyond sales and profits.
His fundamental belief is that “a company cannot be just about selling products. It should make the effort to convey the values the brand contributes to society.”
He cites the example of the difficulties gay men can face, such as inexplicably losing a shot at a promotion after a supervisor tells them that unmarried men have not shown they can handle responsibility. Even though that argument is extremely subjective and has no evidence to support it, gay men have a hard time defending themselves, let alone facing the burden of how differently they might be viewed if they came out of the closet.
With that in mind, Shih brings his team to the annual LGBT parade to show their support.
“They [Unicorn] are the most sincere. Others print stickers to express their support, but Shih chooses to bring big containers of coffee or water to the parade site and hand it out,” chimes in Ko Chung-ning (柯中甯), the deputy secretary-general of the Taiwan Techmakers Association, during the interview with Shih.
Shih’s greatest hope is for his company to positively influence society. When asked if that stance costs Unicorn consumers who are less sympathetic to the gay rights cause, he answers that there’s no need to retreat in supporting what’s right “because if they don’t buy our products for that reason, then they’re not our target customers.”
Ultimately, Shih’s entrepreneurial spirit mirrors the attitude he displays, a combination of a strong sense of responsibility and a powerful warmth that is helping Unicorn gradually emerge as the leader in its field.
Translated from the Chinese by Luke Sabatier
Crossing features more than 200 (still increasing) Taiwanese new generation from over 110 cities around the globe. They have no fancy rhetoric and sophisticated knowledge, just genuine views and sincere narratives. They are simply our friends who happen to stay abroad, generously and naturally sharing their stories, experience and perspectives. See also CrossingNYC.