Patrick established KBBEX and worked as CEO in 2014. Prior to start KBBEX’s project, he was a bitcoin over-the-counter (OTC) trader and has been working in the bitcoin field for one and half years. He worked in Kaplan Financial Training Company (Financial Markets) and Immigration Service of HKSAR before. Patrick has a Bachelor Degree in Business Administration (Computing and Decision Science).
In your own words what is KBBEX?
KBBEX dedicates itself for a simple, professional, secure and multi-currencies bitcoin exchange center in Greater China regions. It is built on customers’ demand and it weighs much on user’s experience. Through KBBEX’s simple and user-friendly interface, users can experience bitcoin trading with no boundary and time limitation. KBBEX put 11 world’s major currencies namely USD, EUR, GBP, CNH (Offshore RMB), HKD, SGD, JPY, CAD, AUD, NZD and CHF into one order book, so that people can buy and sell bitcoin in different currencies according to their needs. Users can sign up for a free account and trade with nil handling charge in KBBEX at this stage. Our users are mainly located in Greater China regions, i.e. China, Taiwan, Hong Kong and Macau. KBBEX is owned by Ashin Limited (VIC). KBBEX’s headquarters is located in Hong Kong and it is managed and operated under Ashin Limited (VIC). The exchange platform is well-developed by groups of senior digital currencies experts, financial experts and IT security experts. The KBBEX’s website was officially launched on 8 Dec 2014. English and Simplified Chinese versions were launched in Jan 2015.
How did you come up with the idea of KBBEX?
Money remittance is greatly hindered by the banks and currency control of different countries. It is quite ridiculous why I do not have the freedom to transfer my own money from place to place. It really takes times for banks to transmit money from one country to another country. Also, the administration fee charged by banks are unreasonably high. I strongly believe the invention of bitcoin can make a breakthrough to this. So,I gathered some people shared the same views that remittance should be reformed by digital currencies.
Before I started KBBEX’s project, I worked in bitcoin OTC trading business one and half years ago. The existing offline transactions (OTC) markets are insufficient to cope with the demand of our worldwide customers. It drove us to open a bitcoin exchange platform. KBBEX plans to launch its China platform whenever users can use onshore Renminbi to perform transactions in 2015.
Could you walk us through the process of starting up KBBEX?
When I worked as bitcoin OTC trader, I found there were great demands of trading bitcoin in Greater China. Thus, I tried to approach some investors to present the ideas to them and to see any opportunities to develop further with them. In mid-2014, we received USD1.5 million from a private equity fund and started to develop KBBEX bitcoin exchange platform. We have started running the bitcoin exchange platform on 8 Dec 2014.
Last year, I met Titan Cheng, CEO of BitoEX through a friend’s introduction. It made me a great surprise when Titan first told me that BitoEX had successfully put bitcoin for sale in convenience stores. Taiwanese people can buy bitcoins without complicated procedures. At that time, my thought first came to my mind, “why don’t we cooperate with BitoEX?” After several interactions with Titan, we found that we have a common goal on the development of bitcoin. Thus, it set the beginnings of KBBEX’s cooperation with BitoEX.
KBBEX has formed a strategic partnership with Taiwan renowned bitcoin company, BitoEx, to supply bitcoins in more than 5000 convenience stores in Taiwan. It will reach 12000 convenience stores in mid 2015. People can buy bitcoins at all FamilyMart convenience stores in Taiwan at the moment. The cooperation turns the development of Taiwan bitcoin industry into a new leaf that bitcoins, the well-known digital currency, walk into the daily-life of Taiwan citizens.
Did you encounter any particular difficulties during startup?
I do believe every start-up must encounter a lot of difficulties and had went thru a lot of challenges. I did encounter co-founders break-up in my previous bitcoin project as co-founder had different directions and opinions in business development. It really made me heartbroken as it’s all about long-term vision vs short-term profit. The rest of co-founders focused on the immediate return but I thought building an exchange infrastructure is the right way down the road. Thus, we broke the partnership and we went on whole different directions. I was a hard time for me, lucky thing is, my team was with me all the time when I was really down in the journey.
Besides, finding right investors is also another difficulty to me. Some investors could only bring you handsome money but some of them could bring you useful resources and connections. As a start-up, you should think twice before you make the decision since it will hinder the development of the company if you choose a wrong one. I was lucky that I find good investors who could bring capital and connections and even give me freedom on business development.
How have you been developing KBBEX since startup?
Hong Kong is a good place to start business. There is good banking system, low tax rate and Laissen-faire policy adopted by HKSAR government which make business runs easier. Also, it is near China and is beneficial to us to develop China’s market. That is why we put the headquarters in Hong Kong.
Around 70% transactions of bitcoin are located in Greater China region. As there is currency control in China, we will establish an affiliate exchange in China to allow KBBEX’s users to trade easier. Besides, we plan to build a payment system to convert bitcoin to gaming points. In short, investing in infrastructure to enhance the security of our bitcoin exchange platform and developing an API to become an exchange of exchanges. Furthermore, we are keen on finding business partners or investors who can supply us resources or give us necessary advices and business connections. I believe that cooperation can make things do better.
What kind of feedback did you get for KBBEX so far?
To my surprise, we have more than 300 users registered our site within 2-months starting from our launching date. It is quite a good result, as we did not yet spend any money in marketing so far. Users said our exchange is very user-friendly; deposit and withdrawal are accurate and fast, which gave them more confidence in using our service.
What is your strategy against your competition?
There is at least one bitcoin exchange platform appeared in the world every month. Competition is fierce in terms of geographical locations. It is especially prominent in China. Every exchange platform do not charge transaction fee in China. If KBBEX wants to enter the market, we need to do the same. Otherwise, no one will use our exchange in China. Of course, we need to increase the charge in cash-out field in order to cover our cost but the charge must be the same price as the other big exchanges’. To stand out from the crowd, you need to identify your specialties in your product. To KBBEX, our strength is we put 11 world major currencies in one order book. People can buy bitcoin according to their local currencies and sell bitcoin in order currencies. It is extremely useful to those merchants and relatives who need to remit money from time to time.
Have you developed any industry insights that you could share?
I do believe that bitcoin can turn into a trustworthy payment tool, the Internet of P2P money. Unlike fiat currency, governments do not print bitcoins and its supply was defined by perfect mathematics (total amount of bitcoin was defined as 21 million units). No Quantitative Easing could ever be happened in bitcoin’s world.
Bitcoin’s price volatility was a two-bladed knife. The fluctuation of price was extreme attractive to speculators and drew a lot of speculations. However, the way it was used as a remittance tool requires a stable price of bitcoin. In order to excel in this industry, you have to design a bitcoin cruise that sails freely in rough water; it’s more an arts to me than the engineering itself.
To be able to survive in this industry, you have to make a very clear vision which group of populations you are serving and you have to build your very own revenue model and make slight changes constantly if you have to. You have to choose the right thing to do at the right moment, an exchange platform lean solely on commission-based model worked well in the past, but with more exchanges coming to the market, market mechanism might be the most lethal force to expel the weaker, especially in the field of disruptive technology, every day’s not a common day, to develop a sensitive market sense is very important.
How do you plan to stay relevant in this industry?
We wish to meet different strategic partners, business partners or investors who could bring us resources and advices. Of course, we will develop a marketing team to let more people know about KBBEX.
What is the future of the industry in your opinion?
I’m very positive and optimistic in bitcoin industry. There are still a lot of opportunities in bitcoin and the underlying blockchain technology. I do believe that non-cash payment would be in the mainstream in not so long future.
Were there anything that disappointed you initially?
Bitcoin still did not have a very good image in the eyes of public in Asia, as they seldom report the positive story of bitcoin industry. Thus, we need to use a lot of time to educate how bitcoin works and how bitcoin could change the future world to public and potential investors. It really takes times to find our seed fund.
What do you think about being an entrepreneur in Asia?
Being an entrepreneur in Asia may be less lucky than in the States. Venture capitalists in Silicon Valley and Walls Street had gathered a lot of supports, advices or resources to the start-ups and it is the culture. However, Asian start-ups often need to fight for resources and pitching. Capitals are also a main concern. Many start-ups could not continue their business due to lack of funds. Although their ideas might be brilliant, they do not have the opportunity to reach their investors or to survive their battle.
What is your definition of success?
Success means bringing a whole lot of people striving for the same goal together with passion, devotion and action to realize.
Why did you decide to become an entrepreneur?
I worked in government before, I saw problem, I fought for change, but was unable to do anything in such a established body. I cannot withstand letting the problem untouched and unsolved. I wish to paint my life with colors, make changes to something, I wish to follow my heart and make things straight! When I came across bitcoin, this is something revolutionary and has great potential to change the world. Life is short, you should do something that will not make you regret. Do not waste time in something that you don’t like. It is a waste of your time and a waste of life.
What do you think are the most important things entrepreneurs should keep in mind?
1) Perseverance and optimistic:
Establishing business is difficult. You will encounter different problems everyday. If a person gives up easily, he will never get success. Having patient and willingness to deal with different difficulties is crucial. Also, you should always be optimistic and have hope that you can overcome the problem.
2) Humble: There is always something to improve and someone doing better in your life, you should be humble to learn from the others, especially from the others’ mistakes.
In your opinion, what are the keys to entrepreneurial success?
A formation of a trustworthy team with good teamwork spirit is the key. A one-man band is not working in business establishment. You only have 24-hour aday and there are a lot of stuff you need to do. An entrepreneur should learn to shoulder some responsibilities to others and should trust the one who you are working with. Also, an entrepreneur should be ready to hear different opinions from the team, digest the messages, filter the goods and bad and lead the team to the right way to get success.
Any parting words of wisdom for entrepreneurs out there?
“ No Guts, No Glory!” & “No Pain, No Gain!” are always in my mind.
It is extremely difficult for one who has a stable job and income to quit his job and start doing business. However, if he does not take any step forward, he will never reach the goal or being an entrepreneur. We should always learn from mistakes and take people’s mistakes as examples, you will get fruitful outcomes.
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