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Alumni CEO - Meet Young Toys CEO, Chan Hee Han / Accounting major, Class of 1993

I still hold fond memories of the little toys I used to hold on to as a child, barely a few years old. Juju and Kongsooni, the must-have dolls for little girls at the time, were manufactured by Young Toys. Since its founding in 1980, Young Toys produced mega hits such as Juju, Kongsooni, and Tobot with the dream of providing our children toys made in Korea. The company also succeeded in producing an animation series from characters developed for stationery - a feat accomplished only by a handful of companies worldwide. This amazing development was all started by an alumnus of Kookmin, CEO of Young Toys Chan Hee Han (College of Economics and Commerce, Accounting major, Class of 1993). We met with Han to hear his story. 

Q. Tobot, the winning toy with the record of no. 1 in sales! What's your secret to reviving the prime days of Young Toys?

Tobot's success was based on the success of our animation, which was targeting a niche market through an unusual format. Normally, animations that are made for broadcasting consist of 22 episodes per season, with each episode running for 26 minutes. If we followed this format, we would not have been able to compete with the high quality animations made by the likes of Disney.

Furthermore, creating a character and displaying the manufactured stationery requires several billion won in initial capital - which is usually secured by receiving funding from various companies and organizations. Unlike Japan, where a single company makes a large investment for manufacturing, Korean investors are reluctant to make large investments. All investors participate with similar shares, which gives them equal say. This prohibits a consistent approach towards manufacturing, and the finished products are usually targeted towards infants. We believed we had to break free from these structural problems.

Thus, we set forth a funding structure that gave more power to our company. We decided on a top-down approach, where we could decide on the scope, the quantity, the quality, and number of characters featured in the animation. The result was an unusual format of animation, consisting of 16 episodes per season with each episode running 4 minutes - a feat we accomplished because we were able to think outside the box. Furthermore, the 4 minute episodes were better tailored for viewers using alternative digital devices such as smartphones.

Q. We also want to hear about your failures as well as your success.
I was part of the Class of 1993. I'm not sure if you will remember, but our class had to bear through extreme ups and downs. We experienced the IMF crisis and several unbelievable legislatures. We also went through the 'Incubating Boom' era where everyone jumped to open their own business. Since I also attended graduate school, I was able to experience all of these turbulences as a student. During the venture boom, I started three different businesses as a student. Of course, they all failed (laughter). I once traded stocks and snowballed my initial investment of 500,000 won into 400 million won.These experiences could all be categorized as failures, but for me, they were the experiences that nurtured me into who I am now. However, going through the IMF crisis was heartbreaking. Many of my classmates who had been hired by large firms received termination letters, and it was difficult for them to find other positions. It was an unfortunate time, but because it was a time of such rapid changes, I was allowed to go through more experiences. I believe those experiences have nourished me to grow.   

 

Q. What did you learn from your failures?
The biggest lesson was that I had to take all matters into consideration. For example, the SARS scare in China cost my other ventures that seemed to be completely unrelated to it. It can be viewed as a Butterfly Effect, but the true reason for my failure was because I did not consider all possibilities. As a student, my startup capital came from money I earned myself, money from the school in support of my thesis, and money from Seoul and other organizations - and perhaps that was the reason I went through so many failures. Now that I am at a place where failure is not an option, I rely on those lessons learned from my past experiences. I give much contemplation before making any choices. I once saw a TV series where a CEO asked, "is this the best you can do?" and I believe that is an apt phrase for his position. Of course, we know that what is before us is the product of hard effort, but we also want room for improvement. When the final decision is made, I bear the full responsibility. However, because I consider all different options, it prevents me from repeating my past mistakes.

Q. Could you give a word of advice to those who are preparing to start their own business?
I have experienced nothing but failure in startup businesses, but still, I want to tell students to take the leap without being afraid. If you start a business with the goal of making huge piles of money, you guarantee your failure. That is why you need to start out with the scope that you could still live through it, even if it failed. The ventures that failed all started by finding a fancy new office and decorating the interior. These people were aiming to make huge profits by relying on funding. However, such businesses rarely succeed. The odds are against you, several million to one. If you want to start your own business, you need to start with a size where even if you fail, you could somehow live through it. Your first office should be just barely bigger than your room or a basement, with each member bringing their own computers. You need to start out like that and build numerous trivial experiences. In boxing, the players throw jabs to measure the distance and their opponents' style before throwing a real punch with their full power. It is the same for business. Also, do not stand as surety for your debt, and do not involve your family or friends. But I think you most likely already know that (laughter).

Q. What was is like, starting out in Young Toys?
Young Toys was not my first place of employment. My first job was as a researcher for the Science & Technology Policy Institute. I had completed my masters degree in a year and jumped right into the job market, but I realized that my first employment was not a good match for me. Young Toys was a company I had heard of through my friends and previous graduates during my years as a teacher's assistant. Actually, I had thought that most people who were hired by Young Toys were the ones who were not as academically motivated during school (laughter). But in reality they were affected by the general atmosphere of Young Toys, which motivated them so that they would not stop talking about their work. That was when I started to show interest in the firm. After a year and a half working as a researcher, I resigned and applied for Young Toys. The founding CEO Sang Hee Kim gave me great leeway. At the time, I was still tied to the research institute for 6 months until the end of my project, but he waited for me. During those 6 months, I would go to Young Toys on the weekends and at night during the weekdays to build plans for its future.

At the time, Young Toys was going through times of extreme difficulty. Even Kyemongsa - a large conglomerate equivalent to CJ nowadays - could go down in a second. At the time, conglomerate affiliates guaranteed the debts of each other, which caused a chain of bankruptcies. Young Toys survived, but we were in a pile of debt and our financial structure was damaged. My first job was to work as a consultant to restructure the financials. I worked with Sang Hee Kim, who is currently serving as our advisor, from the planning phase to execution on both the financial restructuring and the long term goals for the company. After those plans, I set out another 12 year plan. Luckily, all my plans worked out and brought me to where I am today.

Q. Which direction is Young Toys headed?
To be able to share the same memories of a childhood toy with your son, I think, is truly amazing. That is what Japan's Power Ranger and Disney accomplished. Actually, in the case of Disney, even your grandmother may be familiar with it (laughter). I believe these memories serve as an important form of cultural power. I hope the children who are currently buying Tobot can give their own children the same toys they used to play with. Ultimately, we want to be a toy company that makes all of children's imaginations into reality.

Q. What was is like, starting out in Young Toys?
Young Toys was not my first place of employment. My first job was as a researcher for the Science & Technology Policy Institute. I had completed my masters degree in a year and jumped right into the job market, but I realized that my first employment was not a good match for me. Young Toys was a company I had heard of through my friends and previous graduates during my years as a teacher's assistant. Actually, I had thought that most people who were hired by Young Toys were the ones who were not as academically motivated during school (laughter). But in reality they were affected by the general atmosphere of Young Toys, which motivated them so that they would not stop talking about their work. That was when I started to show interest in the firm. After a year and a half working as a researcher, I resigned and applied for Young Toys. The founding CEO Sang Hee Kim gave me great leeway. At the time, I was still tied to the research institute for 6 months until the end of my project, but he waited for me. During those 6 months, I would go to Young Toys on the weekends and at night during the weekdays to build plans for its future.

At the time, Young Toys was going through times of extreme difficulty. Even Kyemongsa - a large conglomerate equivalent to CJ nowadays - could go down in a second. At the time, conglomerate affiliates guaranteed the debts of each other, which caused a chain of bankruptcies. Young Toys survived, but we were in a pile of debt and our financial structure was damaged. My first job was to work as a consultant to restructure the financials. I worked with Sang Hee Kim, who is currently serving as our advisor, from the planning phase to execution on both the financial restructuring and the long term goals for the company. After those plans, I set out another 12 year plan. Luckily, all my plans worked out and brought me to where I am today.

Q. Which direction is Young Toys headed?
To be able to share the same memories of a childhood toy with your son, I think, is truly amazing. That is what Japan's Power Ranger and Disney accomplished. Actually, in the case of Disney, even your grandmother may be familiar with it (laughter). I believe these memories serve as an important form of cultural power. I hope the children who are currently buying Tobot can give their own children the same toys they used to play with. Ultimately, we want to be a toy company that makes all of children's imaginations into reality.

Q. What are the type of workers favored by Young Toys?
I think I am too young to assess others. I think that kind of acumen comes after your sixties. We don't have a fixed type of preference, but when we hire new employees, we find people appropriate for the position. It seems like an obvious statement, but we like to define the work required by the position and hire whoever is best tailored for that position. So we don't have particular preferences for "high specification" all-around workers, and instead hire people best fitting for each post. As a result, our company has a diverse spectrum of workers - ranging from community college graduates to graduates from Seoul National University. Personally, I tend to prefer people who are hardworking and earnest, mostly because I know how difficult this work is. Also, I am fond of people who are willing to swallow discomfort. People who do not like discomfort steer clear of change and innovation because it is inconvenient. They also do not like ethical goals, because it is more convenient to just maintain the same goal as last year. That is why I like people who enjoy discomfort and take on new challenges without complaining. These people also tend to be hardworking.

Q. What are your strategies for attracting top talent?
In one of the textbooks I used for financial management, the first line of the first chapter stated, "The main purpose of financial management is to maximize shareholder wealth." However, I believe it is too limited to narrow the purpose to shareholders. Of course, we need to earn enough for the shareholders, but it is equally important to give benefits to the employees. Customer value creation is a must as well. That is how we maintain a sustainable business. In order to accomplish these goals, we offer wages equivalent to the top 25% of companies with total revenue of 150 billion won, and provide welfare benefits for childcare and healthcare. In addition, we offer resting lounges and support recreational activities to maintain a positive and energetic atmosphere.

Q. What did you learn from your failures?
The biggest lesson was that I had to take all matters into consideration. For example, the SARS scare in China cost my other ventures that seemed to be completely unrelated to it. It can be viewed as a Butterfly Effect, but the true reason for my failure was because I did not consider all possibilities. As a student, my startup capital came from money I earned myself, money from the school in support of my thesis, and money from Seoul and other organizations - and perhaps that was the reason I went through so many failures. Now that I am at a place where failure is not an option, I rely on those lessons learned from my past experiences. I give much contemplation before making any choices. I once saw a TV series where a CEO asked, "is this the best you can do?" and I believe that is an apt phrase for his position. Of course, we know that what is before us is the product of hard effort, but we also want room for improvement. When the final decision is made, I bear the full responsibility. However, because I consider all different options, it prevents me from repeating my past mistakes.

 
Q. Could you give a word of advice to those who are preparing to start their own business?
I have experienced nothing but failure in startup businesses, but still, I want to tell students to take the leap without being afraid. If you start a business with the goal of making huge piles of money, you guarantee your failure. That is why you need to start out with the scope that you could still live through it, even if it failed. The ventures that failed all started by finding a fancy new office and decorating the interior. These people were aiming to make huge profits by relying on funding. However, such businesses rarely succeed. The odds are against you, several million to one. If you want to start your own business, you need to start with a size where even if you fail, you could somehow live through it. Your first office should be just barely bigger than your room or a basement, with each member bringing their own computers. You need to start out like that and build numerous trivial experiences. In boxing, the players throw jabs to measure the distance and their opponents' style before throwing a real punch with their full power. It is the same for business. Also, do not stand as surety for your debt, and do not involve your family or friends. But I think you most likely already know that (laughter).

Q. What are your memories from the Class of 1993?
I was a movie buff from high school. I was unable to go into the field because of opposition from my family, but I did not abandon my dreams. I went to the military service early, and for a year, I was immersed in the movie industry. After a year, I realized how financially difficult it was, and also that I was not as creative and free to survive in the industry. But I realized that accounting was a good fit for me, so I became committed to my major. However, I did not study for the CPA exam like all my other friends in accounting. This does not mean that I did not focus on my studies; I spent my time building numerous experiences instead of hoarding certificates. I found jobs, dated people, and went on trips to explore the world. Because I was not aiming for the CPA exam, I was able to do all that I could during my college years without regret. I believe that was what made me into what I am today.

Q. Who was the most influential professor in college?
Professor Jung Woo Seo. He currently works as a member of the International Accounting Standards Committee. Ever since college, I have relied on him for help, and I hope to be more like him. He knows how to enjoy life, and treats everyone with kindness, yet does not lose sight of his dream. He was my advisor for my thesis, and I learned a lot from him. His style was not to berate you, saying "this is wrong! this is the answer," but he questioned "wouldn't this work as well?" and caused me to think on my own. When I was younger, I thought maybe the professor did not know the answer as well (laughter), but as I grew older, I realized how much harder it would be to teach in this way. I realized that I received a true education. He used to joke, "My dream is human welfare for world peace," and that became the cheer slogan for our department. I just laughed at the time, but now that has become my dream as well. My interest in the toy industry also started because it had to do with human happiness. At the least, I would be able to contribute to children's welfare.


Q. What is your advice for future graduates of Kookmin University?
I have no regrets regarding my college years, because I did all that I wanted to do. I had the luxury of doing so because I did not try to get the CPA license. Of course, getting the CPA may have helped me get a stable job and allowed me to earn more money. However, that is why I was able to build different experiences. This may sound too ideal, but I hope college students stop overworking to gain stable jobs and building their resumes, and focus on building different experiences instead. If you want to be a public official, you should prepare for that. However, if the stress of working for the exam causes you to drink or play digital games, if your choice causes you to resolve your anxiety in such unhealthy ways, it may be better for you to change your path. The path to your goal should be enjoyable. If you are stressed in the process, it is not a desirable future.

Also, I hope the students can focus on their studies. Most students are too focused on getting ready for employment, and overlook their work for their majors. If you study hard on your major and if you end up in a field related to your major, you will realize how much of what you learned in your 20s will benefit you. If you don't give it your best now, you will regret it later.

The Young Toys office that I visited for the interview had a free and comfortable atmosphere. As what you would expect from a toy company, the lounge was decorated with charming decorations and comic books on one wall. It also included a long table and a simple kitchen, where employees could gather and socialize. Looking at the workplace, I could tell that Chan Hee Han's goal of sustainable management, where shareholders and employees share in the benefits of the company while creating customer value creation, was a sincere commitment. He was working towards human welfare that creates values for everyone, and I was proud that he was an alumni of Kookmin University.

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