Helming a growing business while taking some shelter in safer havens like property and gold is entrepreneur Ivan Ong's strategy to ensure financial stability for his family.
Mr Ong, the co-founder and chief executive of baby and maternity brand KeaBabies, says pairing the risky business of starting your own firm with passive investments like stocks and real estate keeps the right balance.
Mr Ong, 35, says: "Giving my family the security and assurance that we will do well financially is very important to me. Therefore, I do not invest in anything that I do not understand or deemed as high risk."
The strategy of focusing on what he knows drives him to expand his business, which sells products on platforms like Amazon, Target, Walmart and Macys, while avoiding assets like cryptocurrency that he is unfamiliar with.
"I invest via a twin engine approach where growth and profits from my businesses are used to invest into the stock and property market for passive income that can sustain my lifestyle indefinitely," he adds.
Mr Ong started out as a solo affiliate marketer, before becoming a public speaker and coach in this field.
He and wife Jane Neo co-founded KeaBabies in 2017 with start-up capital of $30,000 for its flagship product - a baby wrap carrier that the firm listed on Amazon.
Last year, annual turnover for the business, which employs 45 people across Singapore, Malaysia, the Philippines and the United States, hit US$29.5 million.
Its online reach brought it customers from as far afield as the US, Canada, Germany, Britain and Australia.
Mr Ong notes: "When Covid-19 hit and the world was in global lockdown, there was a huge demand surge for e-commerce as everyone was stuck at home and had to buy all the items online. Our sales went up 50 per cent overnight.
"However, with this surge in demand and a lockdown in China factories and the global supply chain, we had to struggle with a massive disruption in our supply chain and getting our products manufactured in time in China and importing it to America, before finally reaching our customers."
He dealt with the issue by placing a bigger orders with suppliers and storing the surplus goods in warehouses.
"This is truly an unprecedented period for the global supply chain," adds Mr Ong, who has a Bachelor of Business degree from the Nanyang Technological University.
"On the flip side, we are continuing to see an uptrend in global e-commerce sales and more people are adapting to the new normal and viewing online shopping as a norm. We expect this trend to continue increasing for many years to come."
Mr Ong and Ms Neo have two sons, Kash and Keon, aged five and six.
Q. What's the next stage of growth for your businesses?
A: We are very focused on growing the brand presence in the North America and European countries. We have two approaches to growing our business. The first is to continuously expand on our brand product range in the baby and maternity space by providing high quality, safe and affordable items for our customers.
The second way to expand is also to sell our products on more major retailers and e-commerce marketplace platform like Amazon, Walmart.com, Target.com
Q. What's in your portfolio?
A: I view my business as my largest portfolio asset and also with the highest level of risk. All the growth would come from my business and I would then like to preserve my wealth in a safer investment portfolio.
In this other portfolio, 25 per cent of it is in equities spread over Singapore, Hong Kong, Australia and the USA. These include Singapore real estate investment trusts and stocks in the financial sector, technology and the medical industry.
Another 30 per cent is kept in bond funds that give cash coupons regularly.
I also have Singapore commercial properties for rental cashflow, which makes up about 15 per cent of the portfolio.
A further 10 per cent is in gold and the remaining 20 per cent lies in cash.
The average return on my portfolio including dividends would be around 6 per cent annually. This is not a high return but it allows me to invest knowing that my money is growing steadily and safely and that I can focus 100 per cent on growing my businesses, which gives the most amount of growth.
Q. What are your immediate investment plans?
A: With the current massive Government stimulus, I do see massive inflation coming in the near future and asset prices are going higher. I am looking to deploy more of my cash into hard assets that are proven to have a long track record of profitability and growth.
I have also recently upgraded our four-bedroom condominium to a freehold landed semi-detached house in D14 with the view that asset prices are going higher in the near future.
D14 refers to the district around Eunos, Geylang and Paya Lebar.
Q. How did you get interested in investing?
A: I once listened to a "hot tip" given by an acquaintance that this certain company's share price will go up. I ended up putting in $100,000 at the peak and losing 50 per cent of its value in one year.
This painful lesson woke me up to the fact that no one will be more concerned about your money than yourself and we cannot rely on anyone else to take care of our money.
Hence, I started to learn more about investing through attending courses for instance.
However, I would like to say that I am not any investing expert and my style of investing is in wealth preservation mode.
Q. What else is in your financial plan?
A: I have not set up any legacy plan yet for my two boys. However, I do have insurance in place that will give my family a lump sum cash payout from insurance plus all my current wealth should anything happen to me.
Q. How are you planning for retirement?
A: Honestly, I'm still 35 years old and my wife is 33 years old, so I feel we are too young to think about retirement and as long as we live everyday passionately with drive and focus, I believe our future will be well taken care of by the actions that we consistently take in the present moment.
One thing that I have learnt is to create more than you consume and continue to add value to the world. This is what gives us the purpose-driven mission to build our business.
Q. Moneywise, what were your growing-up years like?
A: My father ran his own small cleaning company and he passed away 10 years ago. My mother has worked as a customer service officer in UOB for more than 40 years now. It was her first job and she will be retiring from the job at UOB in another two to three years.
I have two older brothers and a younger sister. We are all very close and meet regularly to catch up with our children and to bond together as a family.
Growing up, my mother has always taught us to save for rainy days and to always have spare cash on hand to prepare for any unforeseen emergencies. She has taught us to be frugal and to work hard for what we want in life.
Source: The Straits Times