There are few who understand how leverage the right risks can lead to the best reward like Maodong Xu. The billionaire entrepreneur, inventor, and tech innovator—who was named one of the Top 10 News Figures in China in 2017—has built his tech empire based on taking the leap, making the hard decision, and taking the risky bet. In the last few years, he’s brought his genius to business endeavors in the United States and continues to share his story wisdom about building successful businesses in today’s market.
How did risk inform your early career?
My first business decision was based entirely upon risk. I married and immediately turned away from what tradition expected of me to invest my wedding money in a supermarket. That one supermarket became a chain which would be the largest in our province. I eventually sold that chain and put the money into my tech endeavors, each of which started with an idea, an innovation, or an invention and then was built into a company that million-to-billion-dollar tech groups would want to acquire for the right sum. Risk is about understanding what happens on the other end of a decision and measuring whether the possibilities are worth taking the action. Risk is vital to reward. It always will be.
Is Risk Management Just Damage Control?
Risk management is a construct that allows a company to turn around when they see the risk isn’t going to pan out. It’s not saying “we made a mistake” or “we need to back pedal.” Instead, it’s a way of hedging your bet while moving forward with purpose, understanding that a pivot or change in direction may need to happen. Risk management happens because we don’t want to lose our shirt entirely, but there’s something integral to wild success that must include moments of wild risk. You must be willing to lose from time to time if you’re going to win big. The key isn’t necessarily how you’re going to manage the risk—it’s understanding that you can handle the risk because you have it in you to do it all again and rebuild to a greater reward.
What part do strategic objectives play in reaping the rewards of big-risk decisions?
Strategic objectives are those important focal points that ensure you’re taking the right risks, the ones that matter. Throwing money at the wrong endeavor just for the thrill of risking it all is the type of gambling you see at a gaming table. That’s not what entrepreneurship is. Entrepreneurship is reaching for the stars, knowing they might burn you or you might fall on the way down, but understanding that those stars contribute something of value to the next level on your entrepreneurial journey. It’s not staring into the sun because it’s shiny. Risk should be big when it’s important, when the possible outcome takes you the biggest step forward. You can’t take risk just to make a splash. You take risk to make big strides in your business.
How important is resilience in taking the big business risks?
Big risks pay off when you have the forethought, alertness and analytical mind to keep your hand on the pulse and keep the ship moving in the right direction. You navigate the choppy waters of risk with a keen eye on what’s above and below the water. You don’t just forge through at top speed because it’s exciting—I think we all learned that from the Titanic. With the right head for business, you can get ahead of the game, grab the important opportunities, take the leap at exactly the right time to ensure your best bet of coming out the other side as a winner in this business game you’re playing. Resilience is understanding how to keep forging forward, keenly observing setbacks and course correcting in small shifts that keep you moving forward but skirt the obstacles in your path. People think of resilience when they think of picking up the pieces after a failure, but in truth, resilience is taking the small blows, fielding the judgements and questions, watching the needle move back before it moves forward, and still forging ahead to meet your ultimate goals and reap the big rewards.
In today’s business landscape, no matter what sector, the need for the right risk is vital. Without those brave, savvy souls who are willing to take a leap, make a choice, or risk it all to advance their vision, companies are lost, drowned out by the noise of the bigger, better, bolder businesses in their space. Risk isn’t silly or salacious or the worst way to do business. It’s a strategy all its own that requires the right head for business and heart for a challenge to truly master.