Stories of startup failure and repeated mistakes

Second time starting a business…failed again but failed in a different way.

Luckily, in my previous startup, I was the one who brought Vietnamese instant noodles to greet the stores (in my small Polish car, worth about 1000 USD, I always brought a kettle, bowls, spoons, and forks to try cooking instant noodles for the store owners).

This time too, I brought instant noodles to each store, at first I was rejected because the customers did not know what Instant Noodles were. Some customers even waved their hands and said: "We do not sell Dried Worms". If the customers refused or were busy, I would go to another store and come back another day. One store refused me exactly 10 times, then seeing how persistent I was, they finally agreed to let me consign. Later that store became one of my best selling stores.

However, at that time, I had difficulty with capital, Vietnamese factories at that time all required immediate cash payment before delivering the goods. I was able to borrow money from some partners and friends in Vietnam with an interest rate of 2%/month (24% per year). But when the goods arrived at the Polish port, I did not have money to pay the shipping fee to the shipping company, pay taxes... To have money to import more goods to sell, I had to borrow money from Vietnamese people living in Poland with an interest rate of 10%/month, I am not wrong, 10%/month (because they did not believe I could do it, but with such a high interest rate, they still risked lending me money). Luckily, I sold well, so when the goods arrived, they were almost sold out immediately and the money I received was paid back to me immediately for the 10%/month loan. Gradually, seeing that I imported more goods, many people wanted to lend me money and the interest rate was 2%/month. To have money to pay off the debt, I continuously rotated and increased the number of Containers rapidly, then negotiated with companies in Vietnam to agree to a 30-day debt, then gradually increased to 45 days, then 60 days after the goods arrived at the port.

The second start was more difficult than the first, but I always believed that I would succeed. My city was 500 km from the port (where I first started my business), so every time the goods arrived, I had to go there to do the paperwork (I hired an agency but still needed to be there to pay taxes and sign the papers). One time at the port, I met B again and reconnected. B was very kind, so he told me to go to his house to sleep and in the morning he would take me to the port, not to stay in a hotel because it was expensive.

B was also a petty trader at that time so he had time. B followed me to the port and saw me importing 6-8 containers of 40' instant noodles at a time, so he was impressed. B asked me how I developed the market and I told him everything, without hiding anything. One day, B and I were drinking wine in the evening, B suddenly said: "Let me join you because I'm tired of petty trading". Because B was my close friend and was helping me, I didn't think much and agreed right away. I just told him to give me time to think about the cooperation model.

A few days later, B and his wife came to my place. We agreed to open a distribution company in the area where B lived. I would hold 75% of the shares, B would hold 25% and manage the distribution company. Everything went smoothly. B worked very hard, so the distribution company developed quickly and put pressure on the old company (of A).

After that, my friends heard that B's distribution business with me was developing well, so many people offered to cooperate. I chose 4 more friends in 4 big cities to open 4 more distribution companies (1 guy studied 3 years above me, 1 guy studied 2 years above me, 1 guy studied 1 year above me, and 1 guy studied in the same year as me... all of them were drinking and soccer friends).

And I repeated the mistake of my first startup.

The initial distribution companies agreed on a model where I held 75% of the shares and they held 25%. I provided the products, I instructed them on how to do it, and the chain customers in that area transferred them to them. The companies all grew very quickly. They bought houses and cars one by one, but I still rented a house because I put all the money I earned into working capital.

I returned to Vietnam to negotiate with new suppliers to increase products and take advantage of the growing distribution system. At that time, I returned to Vietnam about 5-6 times a year, each time lasting from a few weeks to a month. That's why I rarely went to distribution companies, sometimes only once every 2-3 months.

The problem started from there...

There are some rumors that Dung does nothing but gets 75% of the shares, while we develop the market and manage daily but only get 25%. Although I was very sad to hear that information, because I own the import company and 100% of the distribution company in the city where I live (my distribution company has the largest sales), I myself proposed to increase your shares to 50%.

The real problem started when one time, a female acquaintance told me: “You know what, Dung? I saw some of your friends just met at my house (because there were some friends with her husband, one of whom was very close. I was also one of the people who lent me money when I was in trouble) and wanted to get rid of you so that I could import goods myself. Among them, the older brother of 3 years was the mastermind, the younger brother of 1 year and a younger brother of the same year were enthusiastically supportive, while the older brother of 2 years was against it, and the younger brother B (who joined my startup for the first time) was silent.

By “professional measures”, I verified that the information was correct. When I released the evidence of your betrayal, my brother of over 3 years turned his back on me, did not pay for my goods and flew back to Vietnam to meet with noodle factories to negotiate imports and was rejected by all of them.

In 2002, when I turned 40, I received an offer to buy my company from a tycoon in Eastern Europe. After a meeting and negotiation, I agreed to sell it with the condition that my friends would continue to maintain the distribution contract with the signed terms.

So the second time I started a business, although I earned a lot of money, I lost some friends and considered it a failure because my spirit was depressed, my body was tired and money did not make me happy at that time.