K.K. Fong Fell Twice — and Came Back Twice

Some comeback stories involve one crisis. K.K. Fong's story is more useful because he had to rebuild after two very different failures.

The Business Times reported that Fong was first declared bankrupt at 24 after a gift-voucher business he started as an undergraduate failed. He joined his family printing business and worked through the aftermath before founding Xpress Print in 1986.

The first rebuild worked

Xpress Print grew from a modest name-card printer into a specialist that could produce financial reports quickly. The company eventually listed in Singapore. Then, during the dot-com era, management diversified aggressively into Internet kiosks and renamed the business i-One.Net.

The second mistake was much larger

The kiosk strategy was overtaken by rapid developments in personal computers, mobile devices and 3G. According to The Business Times, the diversification collapsed and left the company with more than S$80 million in debt. Fong resigned in 2001, sold assets to repay debt and spent several years in China before returning in 2006.

By FY2013, Xpress had returned to a full-year profit of S$2.7 million after a loss the year before. It was not a glamorous recovery. It was a reminder that rebuilding can involve years of asset sales, lower expectations and a return to core operating discipline.

What founders can learn

1. One successful comeback does not make the next strategy safe. Past resilience is not a substitute for current diligence.
2. Diversification must solve a real strategic problem. Chasing a technology trend can distract from a durable core business.
3. Technology risk can destroy a capital-heavy thesis quickly. A business model can become obsolete before the investment is recovered.
4. Asset sales are sometimes part of the recovery. Protecting the future can require shrinking the present.
5. Reputation is rebuilt through execution. A comeback is not a speech; it is years of paying, operating and delivering.

The iPivot perspective

Strategic diversification should be tested against capital intensity, technology risk, management capability and the resilience of the existing core business. Growth into an adjacent sector can create value — but only if the company can survive being wrong.

Source

• The Business Times — K K Fong's comeback story

Independent business-learning commentary. Company and individual references are for educational and historical discussion only and do not imply affiliation or endorsement.