Startup O Stars is a series that captures stories of authentic tech entrepreneurs from Asia, to share their insights, learnings, tips & resources with the community. It aims to foster a deeper understanding of these journeys, direct from the trenches.
Startup-O Stars in conversation with Michael Berman, founder of Psyquation, who shares his uniquely individual views on the entrepreneurial journey.
Michael Berman first felt the pull of entrepreneurship aged 13, when he invested his bar-mitzvah money in the stock market. Bitten by the business bug, he began a lifelong adventure seeking opportunities to create value.
Michael is unafraid to buck trends, as his own ideas have evolved from his long and varied journey. This journey has framed his attitudes to entrepreneurship and allows him to stand out from the crowd. He refers to himself as a contrarian and unconventional by nature, and seldom takes the path most travelled.
Not a believer in limiting himself to conventional methods, he has avoided much of the onerous rigidity that the ecosystem can sometimes lend to the process. He did not follow a cookie-cutter process of creating the perfect pitch-deck and following formal channels to approach investors, relying instead on a healthy dose of hustle, resilience and confidence.
Here, he shares the elements of his journey so far, as well as his learnings and tips for others on a similar path.
1
Fall in love with the impact of your product
Says Michael of founders in their early days, “you need a belief in the product such that it becomes intrinsic to who you are. A founder must believe in their idea, or else they will not stay the course. They will grab any other option if their commitment is shaky.”
Psyquation is an analytic platform for currency traders that serves a multi trillion-dollar industry. It focuses on helping traders become better and more profitable. Michael had worked as a trader for over a decade, and started seeding and incubating other traders, from where he germinated the idea of creating a targeted product.
By this stage, Michael was so committed to Psyquation that his motivation and self-worth felt tied in with the idea. He was now resolute in his wish to roll his sleeves up and ride the roller-coaster to making it a success.
Michael and his team were excited about the potential of their product, even before they saw a path to monetize it. The business is now 3 years old and opportunities to monetize are presenting themselves. About monetizing, he says, “few people start a business with no desire to make money – but if you are going to build a thriving business, at least attach a deeper meaning to it and make sure it stands for something good.”
"Take that leap of faith and take action to support your passion."
2
Own your hustle and keep at it
To get ahead in today’s competitive and fast-paced scenario, an element of hustle is necessary. Michael defines it as the “act of going for it.” To him, it is putting one’s message out, and making the necessary efforts to tell one’s story to the right people.
An important caveat is the importance of being an authentic hustler. Michael has wholly embraced his story, which motivates and supports his efforts to spread his message. For aspiring hustlers, he has this advice: “take that leap of faith and take action to support your passion, and you will be surprised at how far your authenticity will take you.”
When getting one’s message out, it is easy to be daunted by stature, fancy titles, or money. Michael firmly believes in pushing through the intimidation, and having the confidence to know you have something of interest to someone. “Everyone needs a bit of hustle,” he says, adding that while personal parameters may vary, everyone can benefit from having their message heard.
"While hustle is a great skill and a useful tactic, it alone cannot guarantee a desired result."
3
Resilience is your prescription for the dark days
Michael is quoted as having said, “every day is a near death experience.” He is certain that every entrepreneur will face dark days that feel like the end of the road. All entrepreneurs must come to expect (and accept) the inevitable deep troughs.
While hustle is a great skill and a useful tactic, it alone cannot guarantee a desired result. Instead, resilience is often what sets a founder up for success. The desire to succeed and believing passionately in the story will allow a founder to push past rejection, and use every development as a stepping stone to further their objectives.
For Psyquation, running out of money was commonplace before ongoing revenues provided a buffer. Michael is candid in sharing his experiences with running out of money every 3-4 months during the business’ first two years, and their fight for survival. He highlights that through all the difficulties, resilience, determination, faith, and a healthy dose of hustle enabled their growth.
"There is a fine line between resilience and stubbornness, and missing valuable cues to throw in the towel."
4
Resilience 2.0 – when is it too much of a good thing?
For Michael, resilience is not simply single-mindedly sticking with a project. It must also encompass recognising when there is no light at the end of the tunnel, or when it is time to embrace the next challenge.
In 1996, he launched Africa’s first online grocery delivery business, fascinated by the nascent idea of e-commerce (his inspiration for this was Sandra Bullock’s movie, The Net). He eventually closed this down as he couldn’t see a path to profitability. At the time, it was a decision based on a logical thought process that balanced business and personal factors.
For fellow entrepreneurs, Michael has the following advice, “think of what resilience means to you. There is a fine line between resilience and stubbornness, and missing valuable cues to throw in the towel. Should you sacrifice everything in the name of resilience?”
“You need a belief in the product such that it becomes intrinsic to who you are."
5
To Grow, Nurture an Insatiable Curiosity
When he first launched Psyquation, Michael joined a fin-tech hub and several startup mailing lists, both local and global. This allowed him to learn the ins and outs of the industry, and identify key issues, who the major players were, and set him up to grow in this sphere. Michael advises other aspiring learners to do the same, as the information is all available, much of it for free.
An ongoing learner, he is now at a pivotal stage of his development as an entrepreneur, and is focusing now on equipping himself to manage a growing team. He notes that often, larger teams “get busy doing nothing.’ As such, encouraging organizational effectiveness and alignment is top of mind for him at this stage of his journey.
Business aside, Michael is a lifelong learner in all respects, there is no subject that he does not sink his teeth into. He is currently enjoying reading books again which he buys by the dozen, often reading several concurrently. He also enjoys several podcasts that allow him to delve deep into subjects that interest him.
"Each founder has a unique but complementary skill set and brings different competencies to the team."
6
Your tribe is your foundation
The most important factor for a startup’s success is the co-founder relationship. Firstly, having a partner for the journey, to survive the near-death experiences with, is a source of comfort. Secondly, each founder has a unique but complementary skill set and brings different competencies to the team.
Of his own 10-year relationship with his co-founder, Michael points out that it is built on a basis of complete trust. Michael first met his co-founder when he hired him on Upwork as a math consultant for a model, and they soon proceeded to build a precursor to Psyquation.
When working together, some friction is inevitable, which Michael says, one must learn to rise above, and focus instead on the positives of the working relationship. At times when they have felt unable to agree on something, they have sought outside guidance to gain a broader perspective, rather than engage in conflict. This keeps the wheels of their partnership turning and allows for everyone’s best interests.
Similarly, Michael speaks passionately about nurturing all stakeholder relationships, across employees, family, and shareholders, stating that the real measure of success is in the longevity of these relationships.
"You cannot build successful companies single-handedly"
7
How to take people along on your journey
Michael says he likes to dream big and dream bold – and wants his team to believe in his vision. He likes to have ample information available to the team, and says he is an “over-sharer” at times. Of this tendency, he says, “you cannot build successful companies single-handedly, so you need to carry your team along on your journey.”
In building Psyquation, he has focused on finding the right people who are academic and intellectually curious, and giving them opportunities to work on complex problems alongside other smart people. This inspires them to come up with great ideas that can change the world for the better. In his experience, it is this opportunity, rather than money, that is often the chief driver in elevating the team’s energy.
Michael adds that he is a tough taskmaster; for him, average is not acceptable. He expects a stellar output of the people he hires, and is vocal in sharing his expectations, another factor he credits for keeping the team’s energies and objectives aligned.
Entrepreneurship is a marathon at the speed of a sprint
In conclusion, Michael reflects on how he defines success on this journey, and highlights that it is not defined as an exit or capital raise. Instead it is building a company that is profitable, and a product that people see value in, use and enjoy.
Money, says Michael, is “useful” as shareholders are important and founders wish to reward them, but it is not a driving force or key metric for him. He points out that when one goes through this journey and encounters difficulties, it fosters an understanding of oneself and helps to calibrate expectations and dreams.
Three years on, Psyquation is close to profitable, having experienced revenue growth and built a significant balance sheet. It has evolved from regular near-death experiences to its current focus on building the top analytics platform in the world. Expansion plans for Psyquation include crossing into other asset classes to replicate their success.
To sum up, Michael’s vision of success includes financial freedom; but more importantly, keeping reputation intact and keeping stakeholder relationships intact – namely, finding that all important balance.
Startup-O is South East Asia’s leading platform for startup assessments, investments, and venture building. It was created with ‘Entrepreneurs for Entrepreneurs’ ethos at the core of its design. The assessment platform coupled with venture funds helps with systematic discovery & investing in high traction tech startups. These promising growth startups are selected through a transparent process which is a blend of multi-stage online evaluations conducted by seasoned global experts & proprietary ranking algorithms on the platform.