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Interview: the man who led Nokia’s charge into Asia

The author, Shiwen, is a part-time freelance writer, aspiring entrepreneur and overall generalist interested in exploring, researching and writing.

Thomas Zilliacus newkia yuuzoo

Headquartered in Singapore and with over 37 million registered users in all its networks spread across 164 countries, YuuZoo markets itself as the next generation of social networks powered by the surge of smartphones around the world.

A relatively young company dating back to 2008, it will be listed on the Singapore Exchange through a reverse takeover for S$490 million ($383 million).

But the story of YuuZoo is also intertwined with that its chairman, co-founder and CEO, Thomas Henrik Zilliacus, who has been involved in the world of mobile telecommunications for over 30 years, starting with Nokia in 1980.

From 1980 to 1996, he oversaw corporate communications, public relations and branding in both Finland and the Asia-Pacific. His involvement with the Nokia legacy continues on, through his role as the Chairman of the Board of Singapore-based Newkia, a firm made up of ex-Nokia employees that wants to make Nokia-like Android phones.

At the YuuZoo office on Beach Road, Singapore, he shared part of his story with Tech in Asia, as well as on developments in YuuZoo that led to the reverse takeover.

Tech in Asia: What got you so deeply involved in mobile telecommunications?

Ziliacus: Well, I didn’t choose telecommunications so much as it chose me. I was in Finland in the late 1970s, when there was a big generational shift in society due to the demographics of the time. We ended up with a lot of people in their late 20′s becoming government ministers, civil service officials and corporate executives. Nokia followed suit and they hired me.

Nokia was originally a conglomerate with several divisions and product lines, such as a rubber division which made rubber boots. I was initially reluctant as I didn’t want to have a career selling rubber boots but the CEO at the time explained to me the new direction of Nokia and recruited me as global head of Nokia’s corporate brand, marketing and PR.

Nokia is actually the name of a city in Finland, where the Nokia Corporation was founded in 1876. It was my paternal grandmother’s uncle that actually founded Nokia, Fredrik Idestam. Nokia was originally a paper company, which then merged with a rubber company and later a cable company. And out of that grew the telecoms and mobile business.

What was your first major project with Nokia?

One of the first was the marketing campaign that penetrated the Swedish market. We went into Sweden with a novel campaign idea where we did not tell our name at the beginning of the massive campaign.

Instead, we asked questions such as “which rubber boots company also is a leading player in telecommunications?”, then followed a week later with an equally massive campaign saying only: “The answer: Nokia”. Our brand recognition went from zero to very high numbers literally overnight.

When did you first come to Asia?

In 1986. At that time we had no business in Asia. I was a member of Nokia’s management board. At one of the weekly meetings the idea of starting something in Asia came up.

I was the youngest guy in the management board – probably by a margin of 15 years – single and with no family. So I was the cheapest option available, and maybe that is why the CEO chose me to open the Asian markets, which at that time nobody had great hopes for. I ended up in Singapore as Nokia’s first Asia-Pacific Head.

At the time, the leading player in mobile phones in Singapore was Motorola. I saw an opportunity in mobile, and decided that Nokia in Asia should focus on that sector. Mobile thus became our focus in Asia for six to seven years before it became the core business of Nokia worldwide.

How do you feel that a different cultural perspective contributes to your business decisions in Asia?

I’ve had a very long stay in foreign markets, and I’ve come to realize that the longer I stay the more cultural differences will pop up. As a foreign businessman entering a foreign market, you need to be humble and adaptive. YuuZoo currently has employees from ten different countries, and I need to manage all different cultures in the right way.

During my time with Nokia, there was this Thai employee who came up to me and told me that he felt embarrassed as his boss – me – wasn’t driving an appropriate car for a CEO. He suggested that I change my car from a Peugeot to something more appropriate, like a Mercedes Benz, in order to reflect my position.

In Finland a flashy car would have been considered inappropriate. Finnish culture is very direct and to the point, which is good for efficiency and business. But in Asia, there is more need for talk and consensus. Too much of that can lead to inefficiency. As a CEO in Asia, I need to find the right balance between the two.

How has your experience with Nokia shaped your business decisions?

My experience with Nokia at a very young age made me understand the importance of processes in a company. Processes and planning are critical. Making decisions without preparation and planning easily leads to wrong decisions and mismanagement.

What do you feel are the most important considerations when doing business in the telecommunications sector?

The mobile market is consumer-driven and very fast in its developments. New technology and new solutions emerge all the time, and the cycles are getting shorter. You need to see not only the present but also what the future is bringing. You however also need to make sure you do not launch solutions and products so much ahead of the curve that consumers are not ready.

Many companies in the tech space have gone under due to lack of understanding about consumer readiness. Timing is crucial. Technology is developed by engineers who may see a technically superior product, but if the consumers do not see any need for it, then it won’t get any traction.

What led to you to establish YuuZoo?

YuuZoo has changed its course from its initial conception. I saw a need for mobile services to be packaged for consumers in a targeted fashion. But this was before social networks were gaining traction. When the use of social networks exploded, I had to re-evaluate what YuuZoo was doing. What we do today is again not permanent but has to adapt to how the market evolves.

What motivated the reverse take-over of Contel? It’s something rarely seen in the corporate sector.

It was pitched to me by a bank. Initially I was hesitant, but through discussions and research I started to see the value. Through the listing we can grow more quickly, make acquisitions and raise funds more easily. In the Singapore environment a reverse takeover is from a due diligence aspect as stringent as an IPO.

It’s critical for companies to have the trust of the markets, and the due diligence process is central to this. With a listing YuuZoo can grow faster, and an RTO is faster and cheaper than an IPO.

Why choose Singapore as YuuZoo’s HQ?

I live in Singapore. Singapore is a very good environment for companies to operate in and from, so setting up the HQ here was an easy choice. The Chairman and CEO of a listed company must be available to analysts and investors. If we listed in the United States this would be much more difficult. To also do the listing here therefore became a natural choice for us.

Whats your opinion on upcoming mobile developments, given Samsung’s development of Tizen, Firefox OS by Mozilla and Ubuntu Touch by Canonical entering the market over the next few years?

It’s tough to dent Android’s position, as the new operating systems would have to offer something better. I find it hard to imagine that these today could do that. Users never like dramatic changes to what they are used to, and tech companies often forget that.

iOS vs Android – which is the better platform for business and app development?

That’s a hard question to answer. If I’m forced to make a distinction, I’d say the better platform is the one that’s more open – Android. iOS is a closed environment, which to some extent poses challenges to users and developers. It’s a very good OS but it forces you into the Apple ecosystem. Apple has been able to do what no other hardware manufacturer has done, create fans out of consumers. Those fans love everything linked to Apple and would not consider any other brand.

Do you feel the current migrant restrictions inhibit Singapore’s status as an economic hub? Have they impacted on YuuZoo’s ability to do business?

Yes, it is an issue of concern when it comes to tech companies. We require people with specialized technical skills and experience. We love to hire Singaporeans but if we cannot find local people with those skills and we are not allowed to hire foreigners, then that forces us to invest in R&D facilities outside of the country, rather than consolidating our activities into a single place.

We recently established units in the Philippines and Malaysia, and once an overseas unit is set up, the functions, units and the personnel are there for good. We would have loved to set them up in Singapore, but we could not and now they are functioning well elsewhere. I am a huge fan of Singapore and want to see the country continue to succeed.

Singapore’s success has been built on being an attractive location for companies to have it as an Asian base, and a change in this would be negative for the country. I therefore feel that policies need to be tailored so that they do not force companies who cannot find local talent to set up shop overseas.

What do you look for in companies you plan to acquire?

For Newkia, we are considering an acquisition to accelerate our market entry. We can either build the capacity ourselves or acquire to enter the market faster. For YuuZoo, we’re looking to make multiple acquisitions. We are looking for user growth and the user base of companies we acquire is therefore one criteria. We’re also looking at interesting e-commerce opportunities.

Any advice for venture capitalists and angel investors looking to enter the startup scene?

You need to be willing to take risks, and you can’t make safe bets all the time. You need to be open minded and invest in people. Don’t invest in them if you don’t believe in their abilities. A lot of venture capitalists and investors have money but seem to think they therefore know how to run each business better than those who started it. Invest larger sums in fewer companies, rather than spreading it in small amounts across multiple companies. And do your homework – your due diligence. Finally, think big.

Any advice for would-be entrepreneurs out there?

It’s a little bit of the same. Think big. Ask yourself: “Is this an idea I can expand into a regional or global thing?” Think of the big picture and learn how to present your case to investors. Entrepreneurs often lack the skills to present to investors. A lack of confidence is the biggest hurdle for many.

What has been your memorable moments as an entrepreneur?

I have been an entrepreneur since I left Nokia in 1996, and I can’t really pinpoint a specific moment as the most memorable. Coming from a big corporate setting, it was joyful but scary to transition into that lifestyle. Every new start and every new exit are big moments in any entrepreneur’s life.

Do you plan to write a book, given your background with Nokia and insights into the telecoms world?

Coming from a large MNC, I have seen how much entrepreneurs have to think lean. I’m big on supporting efficiency improvements, on knowing how to spend time and money. There are many books on lessons to be learnt from large companies. I would like to turn the table, and I have toyed with the idea of writing a book on how big companies can learns from entrepreneurs on how to be more efficient and focused.

Large companies can easily become wasteful, with a lot of unnecessary fat and bureaucracy. Having been with a large corporation for 16 years, and then an entrepreneur for another 17 years, I would like to write about it once I have the time.

Before we go, is there some small fact you’d like to share about yourself that most people generally don’t know about you?

I have a strong footballing background, having played the game myself both in Finland and Brazil, then being chairman of Finland’s champion team HJK, and finally team manager here in Singapore for Geylang United from 1989 to 1994.

You can find out more about Thomas Zilliacus at his profiles on Businessweek and LinkedIn.

(Editing by Terence Lee)



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