Toby
Chu knows the secret to doing business in China: persistence.
Thankfully, that's his greatest business strength. The
president of Capital Alliance, the merchant banker behind
the CIBT, the Canadian Institute of Business & Technology
(#36), arrives at work every morning at seven. He watches
markets unfold on his four computer monitors. Only at
11 p.m., after a late-night review of the day's events,
does he call it quits.
His diligence has paid off. Chu is willing to wait for
the right opportunities for his VC business, which provides
funding for projects, then manages them until maturity.
Right now, Capital's main interests include an e-securities
software business and CIBT, a trio of Beijing business
schools. His most recent deal, with a Hong Kong firm interested
in purchasing his e-securities software, was inked only
weeks ago. "I've been in discussions with them for nearly
two and a half years," he says.
It's taken that kind of patience to weather the infamous
trade problems, such as vanishing inventories and delayed
payments, that have made China such an unpopular destination
for foreign investors. Chu believes it's a market ready
to boom. That's why he's happy to lie in wait, developing
contacts and establishing a reputation until it comes
alive.
Toby Chu on education:
"You get paid upfront, you have no receivables and
you have no inventory."
Chu entered the Chinese market in 1994, five years after
the Tiananmen Square massacre, he says "when the cost
of establishing business in China was at its lowest ever."
In Beijing he established CIBT, which delivers MBA programs
and Western-style business education for Chinese executives.
He says it was a low-risk way to enter the Chinese market:
"You get paid upfront, you have no receivables and you
have no inventory." Now with three campuses, CIBT has
become a cash cow for Capital Alliance, which derives
75% of revenues ($2.5 million in 2001) from the business.
Getting there hasn't been easy. "Dealing with government
officials takes a lot of time," notes René Champagne,
chairman and CEO of ITT Educational Services Inc., which
recently partnered with Chu to add IT courses to CIBT.
"Chu and his staff have been very persistent with them.
That's what it takes to break into a market like this."
With China tagged to host the 2008 Summer Olympics and
its acceptance into the World Trade Organization, Chu
believes the payoff is coming sooner rather than later:
"You have to have the patience and grind it out."
CIBT
was recently selected as Canada's 36th Fastest Growing Company
by PROFIT Magazine in its PROFIT 100 list. PROFIT Magazine
is widely recognized as Canada's authoritative annual ranking
of the country's fastest growing companies.