Stephanie Chai: 9 Golden Rules To Turning Your Business Idea Into A Reality
“I think awareness and personal growth is such an important part of life; we don’t have to be perfect, but we should always strive to be better. Be it some self-reflection, a session with a life coach or healer – every year should be a year of growth.”
Meet founder and CEO of The Luxe Nomad, Stephanie Chai. With what some might say is an unconventional background as a former TV host and model, Chai is recognised as a leading female entrepreneur in S.E Asia having launched The Luxe Nomad in Singapore in July 2012 – albeit having no track record in hospitality or tech.
“Business isn’t easy and let’s face it, you can’t be ‘nice’ 100% of the time. But winning doesn’t mean sacrificing values or undermining others. Always think of the long-term effects of decisions.”
Originally launched as a flash sales site (back when Groupon, Jetsetter etc. were all the trend), The Luxe Nomad started out with a small team of three and just four flash sales listed on its first day of operations. Despite limited funds (it raised only SGD 250,000 – half of its closest competitor), the company grew its brand by pioneering its Celeb Nomad campaigns, where partner hotels would host influencers and celebs – something which is a common sight to see on social media nowadays.
Talking about the early days, Stephanie Chai says, “The challenge we had with flash sales, was akin to everyday retail – if something is on ‘sale’ all the time, there comes a point when you just don’t get excited about it anymore. So we knew that at some point we would have to change – it was just a matter of when.”
Thus, two years after launch she pivoted the business from flash sales to focus on luxury villa bookings, a growing and more lucrative trend that was picking up in popularity. Whilst a pivot can be a ‘do or die’ moment in a start-up’s lifeline, The Luxe Nomad proved it was the right decision to make; as annual sales doubled albeit operating expenditures remaining flat.
Today, you can book over 1500 curated villa listings in 33 destinations on TheLuxeNomad.com, where a luxury pool villa in Bali can cost as little as USD100-150 per room – in line with the company’s mandate that luxury can be affordable.
And as the next natural step in the company’s growth, in Oct 2017, The Luxe Nomad expanded into villa management via its first acquisition with a villa management partner in Bali. The company now manages 37 luxury villas in Bali, and since the takeover, have increased overall bookings in Q1 2018 by 58% YoY.
Driven and focused, Stephanie Chai and her team plan to grow their managed properties portfolio by twofold by the end of 2018.
The golden rules that helped Stephanie Chai turn her business idea into a reality
Take time to find the right idea
“What I realized was it is not easy to find the right business idea. If you’re going to start a business, you have to be 100% sold on it.”
Prior to The Luxe Nomad, Stephanie admits she ran through numerous business ideas. From importing vodka jellies that didn’t melt to launching a women’s digital magazine site to building a zen escape in the city, Stephanie spent her free time going through different business ideas till she, of course, found the one.
She says it took her two years of searching before a friend sent her a link of a similar luxury travel site in the US that inspired The Luxe Nomad. She knew within five minutes that she would do it.
Make sure you have enough money (for the business and personally!)
Stephanie’s dream to become an entrepreneur apparently started many years ago, when she was just a teenager. “Being the only girl and the eldest, my parents were always far stricter with me than my brother, and money was the main channel to control me – so I long decided when I was 14 that financial independence was key!” Stephanie reveals.
Stephanie continues saying that when she started first started modelling (whilst in university) during a summer break in Singapore. During a shoot, a top make-up artist asked her, “Do you want to be famous or do you want to make money?” to which she responded, “Money please!” The make-up artist’s advice was to then focus on TV commercials.
Stephanie hit the jackpot by shooting over 50 ad campaigns in Asia during her modelling days, from Olay to Nivea to Citibank, and ended up saving 70-80% of her earnings for her future plans of being an entrepreneur.
“The top models were always booking business class tickets, whereas I chose to fly budget (short haul at least!) and save what I could”
Had modelling not been on the cards, she said she already had started studying how to invest in stocks – something she ended up doing nevertheless.
Starting a new business usually entails some financial sacrifice, so Stephanie’s planning ahead ensured that when she did, she had a bit of a nest egg to live off and she was able to invest USD 50k in The Luxe Nomad to get it going.
“When it comes to the business, every situation is different. Some business models require funding from investors whilst some can be bootstrapped. Understand your model and plan accordingly,” she notes.
If you don’t have enough money, reduce your cost of living.
But what if you don’t have any savings? Does that mean you shouldn’t embark on starting a business, knowing that you will be earning little or no salary at first?
Stephanie believes it’s a matter of how much you’re prepared and willing to sacrifice. “If money is an issue, look at how you can reduce your cost of living to make ends meet. If you are renting, perhaps you could move back with your parents? Or what about re-evaluating the lifestyle you lead? Try cutting out expensive dinners and meet up with friends for coffee instead? Where there’s a will, there’s a way…,” she suggests.
Stephanie points out that starting your own business is stressful enough and if you have savings to live off during the early days, at least that is one less thing to worry about.
Leverage your experience – connect the dots!
Prior to The Luxe Nomad launch, Stephanie was perplexed as to how to differentiate the company – given there were 3 other competitors in Asia who had the same flash-sales business model for luxury travel.
The idea to engage celebs and influencers came to her when she visited some hotels in Phuket. “Back then Kim Kardashian’s popularity was rising and I felt – who’s really interested in reading a long article by a travel writer anymore?” Stephanie says, explaining that there was a growing shift towards celebrity culture and social media channels like Instagram.
“So, I contacted a few old celeb friends such as Allan Wu and asked if he would be interested to be a Celeb Nomad, to which he kindly replied with a yes,” she reveals.
“It was my background in modelling and television that allowed us to pioneer the Celeb Nomad campaigns – which helped build our brand with little cost.”
To top that off, Stephanie’s experience having modelled everywhere from Hong Kong and Thailand to Singapore gave her an insight into working with different cultures, which was relevant to The Luxe Nomad given that at the time they were adding on properties from various destinations.
“When it came to the art of negotiation, I already had years of experience from my modelling days. As in Thailand, I had a very petite but pocket-rocket of an agent P’Dao, who taught me how to negotiate – we used to discuss if we should ask clients for larger budgets etc. and how much to charge for added media buyouts,” Stephanie says, adding that part of negotiating well is reading the other party and toeing them across the line.
Be selective with investors and co-founders
When starting your own business, Stephanie’s advice is to choose wisely when it comes to selecting the right investors and deciding if you want to have a co-founder join you. Whilst Stephanie herself is a sole founder, she believes that when selecting an investor/co-founder, you need to adhere to the same principle – make sure you are on the same page.
Having raised SGD 2.8 million thus far, Stephanie acknowledges that finding the right investors is not always easy, especially if a start-up is strapped for cash and in dire need of funds. “You never want to be in the disposition where you have two months of funds left and are then willing to take whatever you can get!” Stephanie says. She advises that you need to start fundraising at least nine months prior to when your bank balance hits zero.
“It’s a bit like dating – you need to make sure you have similar values, vision and principles.”
When it comes to finding a co-founder, Stephanie points out, “I have heard of some cases where founders and co-founders fall out or go to court – it’s a disaster. So be really careful about who you decide to work with,” reveals Stephanie.
Even when she first started The Luxe Nomad, Stephanie initially thought she “needed” a co-founder to share the workload. “In the end, I did it myself and it has worked out fine!” Stephanie exclaims, continuing that she hired a COO, Lee Lian Foo, who has been given equity in the business.
She adds that this has really helped as her COO is strong in the areas she is weak in. “And even though you may not see eye to eye from time to time, it’s ok as long as you keep in mind it’s business and not personal. You don’t want someone who always agrees with you anyways!” Stephanie smiles.
Be prepared to make mistakes… a lot of them!
“Things happen for a reason. You grow a lot as an entrepreneur when you make mistakes. That is something no university degree can replace.”
Part of learning from mistakes is to be flexible and be quick to adapt. “Look at Kodak or BlackBerry—two companies who failed to innovate and stay ahead of the game – and that are now left sorely behind,” Stephanie exclaims adding that no matter how great your business is doing today, always be on your toes and be open to change, “because it is the market that ultimately decides tomorrow whether you are relevant or not. Agility is key!” Stephanie notes.
Upon asking Stephanie if there were any mistakes she would like to go back to and fix if she could, she surprised us by saying, “Knowing what I know now and having made the mistakes I made, if I could do everything again I would do my entire current strategy in a year and probably have made a lot more money!” She chuckles, “But I don’t have any regrets. You learn so much from mistakes and today I rarely get stressed.”
“One of the key characteristics of being an entrepreneur is having Grit. Running a business is never smooth sailing so be prepared for tough days to arrive sooner or later. Nowadays when I come across a problem I don’t spend much time dwelling on it, instead, I start thinking about plan B!”
Get into the trenches and learn from the bottom up
Looking back, Stephanie is thankful that she has had a hand in all aspects of the business – from tech and sales to marketing and operations. As a result, she knows first-hand how things run and how long processes take with most departments.
Stephanie believes that it is important for managers to show their team that they are willing to help out from time to time – even with the little things. She says it earns respect and creates a flat organizational structure.
“Just because you’re CEO or part of senior management, it doesn’t mean you are above the smaller tasks at hand. After all, it is hard to manage people if you don’t have a concept of what they’re doing.”
“Once in a blue moon if our reservations team is overwhelmed or if some of the team is away, I’ll volunteer to help out on a weekend shift. It’s good for team morale to know that their CEO has got their back and respects what they do!” confides Stephanie.
Surround yourself with the right people
Originally, The Luxe Nomad launched with just three people in 2012 and today is now 42 employees strong. “I love that every year is different and that we’ve managed to grow something from nothing. We have a small team and everyone comes from different backgrounds. From some who didn’t attend university to those who have their masters from top universities in the UK, it’s a mixed bag but everyone shares the same values of working hard and thinking outside the box,” she notes.
For a team that continues to grow, it is imperative to hire people who buy into your “big idea.” Stephanie believes that as a leader, you need to remind employees of the vision and purpose of the company from time to time.
“You’re always selling the dream – be it to investors, clients or the team”
“With regards to the team, I’ve always reminded them that we are a small team who’ve come from nowhere and have built a luxury brand that is not only regional but will be global one day! Wouldn’t that inspire others to fulfil their dreams?” exclaims Stephanie.
Indeed. It is no wonder then that The Luxe Nomad’s tagline is “Dream a little. Travel a lot”.
But what if you’re not the most social leader or people-person? “If you are not someone who is sociable, find a manager who can rally the troops together. People only do well in their jobs when they excited about it. So keep reminding them of your vision and the dream,” she advises.
Last but not least, don’t forget to give back!
Being an entrepreneur means knowing how to ask for help. In the early days, Stephanie approached many of her friends for advice. She once had help from a close friend’s wife, whose family ran a hotel in KL – in order to learn about how hotels worked with online booking sites.
“Back then, I had zero knowledge of the travel industry other than being a traveller so it was a crash course. What did RevPar, ADR, and channel managers mean? From visits to the hotel and chatting with her sales manager, I was able to derive how we should structure and design The Luxe Nomad’s backend,” Stephanie discloses.
“One key thing is to always return the favour and never forget the help you received.”
Today, Stephanie Chai is ever willing to give back and help others, be it in the form of helping connect people or by giving business advice. “In the early years, we got some lucky breaks and the least I can do is to return the favour. Thus sometimes we have done marketing tie-ups with smaller companies because we liked what they were doing, even though a campaign was far more beneficial for them than us,” shares Stephanie.
“I think particularly in Asia, it’s the cultural norm to always remember when someone has helped you out. There’s nothing worse than ‘forgetting’ the help you got, it’s just bad behaviour. I’ve met a couple of people like that over the years but I don’t dwell on it, though it’s not something I would do,” she continues.
With a year-on-year sales growth of 77% at the group level in Q1 2018 and a year-on-year revenue growth of 132% in the Bali management company, The Luxe Nomad is clearly going from strength to strength.
Smiling as she shares what’s in store for The Luxe Nomad in the next five years, Stephanie reveals, “In three years we should see The Luxe Nomad grow to become Asia-Pacific’s leading luxury villa management company. Right now the market is highly fragmented and there is no recognised management brand in the region – whereas in the hotel industry there are many brands to choose from – we aim to fill that gap in the villa market.”
Catch Stephanie’s favourite TED Talk here.
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