Wed, Mar 24, 2010
The Business Times
Creating Asia's largest science publisher


WHEN Doreen Liu received her first cheque payment for a book that World Scientific sold, she went to the bank to cash it. The cheque was for $5 - and the bank charged her $5 for cashing it.

Ms Liu was practically clueless about such financial dealings - or about running a business - having worked in a statutory board handling administrative chores.

Yet she and her husband Phua Kok Koo, a university professor of physics, have gone on in the past 29 years to build World Scientific, based in Singapore, into one of the world's leading scientific publishing houses - and the largest in the Asia-Pacific region.

And while Professor Phua is today chairman and editor-in-chief of their publishing company, Ms Liu, as managing director, controls its money, says her son Max, who has been drafted into the family business and holds the title of executive director.

It helps that the husband-and-wife team started out with a nobler purpose than merely making money.

'If it were just about money, we would have sold the company,' says Ms Liu, who did not get a salary in the first two years of the company's operations. 'After two to three years, Times Publishing wanted to buy us, but we said no.'

Prof Phua, whose father was a publisher of Chinese books, says they wanted to break the monopoly of the West in the publishing business - and set up an alternative source of textbooks for professionals, scholars and researchers worldwide.

And they were encouraged by Nobel Prize winners in the scientific community in the United States.

'So we felt the timing was right to set up something headquartered in the Asia-Pacific region,' Prof Phua says.

It didn't cost much to get a publishing house going, according to him. Just $250,000, which the Phuas got from a bank by mortgaging their house.

Prof Phua's connections in the academic circles came in very useful in securing manuscripts, but the couple had to labour to sell the books.

Ms Liu - sometimes with help from her children who were still young - worked overtime to paste stamps on envelopes to mail promotional material to likely customers in universities and libraries all over the world.

'I used to drive a van and lug sacks of the materials to the post office. Imagine, with my size,' recalls the petite lady.

But while the capital required for venturing into publishing wasn't very much for the Phuas in 1981 - even in those days before the advent of low-cost desk-top publishing - Ms Liu says the entry barrier was high.

'Not many people can understand it because the level is too high,' she says of the books' contents. 'If it's kindergarten books, everybody can understand it. The entry point is high not because of money, but because of intellect.'

World Scientific books are read by professors and students studying for a Master or doctorate degree.

'Not every entrepreneur can say this is a good book at these levels; he won't understand it,' Ms Liu says.

Prof Phua, a theoretical high-energy physicist who did some interesting and useful work in particle physics, is, of course, qualified to do so.

There were also other factors that helped World Scientific get off the ground.

Prof Phua says that while the company is handicapped by being located away from the centre of learning and research in the West, World Scientific has access to people with a good command of the English language in Singapore.

And this is key in building up a good editorial team - vital in the publishing trade.

Yet publishing scientific books is a global business - and competition is 'very, very' tough, Prof Phua says.

Right from day one, World Scientific was thrown into the lion's den to vie for the same customers as those of global players like Cambridge University Press, John Wiley & Son and McGraw Hill.

Many of these players have been in business for centuries. But the young start-up was not trampled over - and it not only survived but thrived.

Today, World Scientific publishes some 500 book titles and 130 journals a year for the global market - and is shooting to double these figures in the next five years.

'We broke even in the second year,' Ms Liu says.

And the company has never looked back since, as sales revenue grew at a double-digit pace yearly.

Last year, when the global economy was deep in recession, sales jumped 10 per cent when the company was expecting 8 per cent, according to Max.

The staff on World Scientific's payroll swelled from five to more than 200 and the company has opened offices in New Jersey, London, Hong Kong, Taipei, Chennai, Beijing and Shanghai.

'We were the first publishing house to move into China, in 1981, long before anyone knew China was going to be a super economy,' Prof Phua says.

At $40 million, the company's annual sales - with more than 80 per cent of it made abroad - do not look impressive. But it commands fat profit margins.

And the Phuas seem to have done very well. They run their business in a modern building. A model of their large bungalow is displayed in Ms Liu's office.

Parked in the porch of their office building are a Mercedes and a BMW.

So what brought about the success of a business dominated by publishing giants - and what have they overcome to achieve it?

'The industry's quite safe and we expanded step by step,' Prof Phua says. 'We come from the academic community, so we know what's going on - the new frontiers, who are the most active persons.'

Max says being small also gives World Scientific an edge over the big boys. 'We're nimble and can act and move faster.'

'Our biggest challenge was - and is - to get good people. Otherwise, it's been a pretty smooth journey,' sums up Prof Phua.

But while the company may find it tough to recruit talent to run the business, it appears to have less of a problem securing authors - thanks to its 'author-centric' culture.

'We have this ingrained interest in making authors happy - all our staff take care of them very well,' Max says. 'Authors like to work with us; they feel World Scientific has very nice people.'

And that's another competitive advantage it has over its big competitors.

Technology may be killing books, but World Scientific isn't troubled by that.

'We're not printers, we do content,' says Max, who is in charge of developing new business for the company. 'It doesn't matter what the platform is as long as your content is good.'

In fact, he says, new technology opens up new markets for World Scientific.

And that's where the company will head in the next stage of its journey.

This article was first published in The Business Times.

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