The accidental entrepreneur
DATUK Foong Wei Kuong founded JF Technology Bhd from his kitchen at home in 1999 without an office, employees or customers. It had been a one-man show until he hired his first employee a year or two after setting up an office in 2003.

“I was the salesperson, technical person, product designer assembler and quality controller. Everything was insufficient — knowledge, customers and personnel.

“The company was burning money every year. After raw material costs, travelling expenses and other costs, it was difficult to survive. I thought of quitting,” he says.

Foong, who refers to himself as an accidental entrepreneur, says the first four years were the toughest, fraught with many hurdles and uncertainties, so much so that he nearly gave up.

It was just after the Asian financial crisis of 1997-98. Demand for the group’s products and services was soft because the inventory in the semiconductor space was still high due to the Year 2000 problem that created a chip glut.

JF Technology started out making electronic product components before expanding to designing and developing IC test sockets for the semiconductor and electronics assembly markets that it is known for today.

The breakthrough came in 2003 when the company met with SRM Integration (M) Sdn Bhd, which was looking for test socket vendors.

“Nobody could do it. I looked at the opportunity and told them that it was possible, not knowing the big challenges ahead,” says Foong, who is JF Technology group managing director.

He says the company overcame these hurdles with hard work, persistence and grit. As SRM became one of JF Technology’s biggest customers, the latter’s sales and performance improved significantly.

“This is one of my most memorable experiences. To have a company of such stature put their trust in us, especially when it was essentially a one-man operation, was really something.

“Despite the influx of orders, there were not enough resources, so I worked about 14 to 16 hours a day,” he says.

Foong has proven to be a shrewd businessman with a keen eye for opportunities, especially in times of crisis. Last December, he was named EY Entrepreneur of the Year (EOY) 2023 Malaysia and also won the Master Entrepreneur category.

Foong was selected from 14 nominees and will represent Malaysia in June at the EY World Entrepreneur of the Year (WEOY) 2024 Award in Monte Carlo, Monaco.

He says the market generally remained sluggish in 2002 to mid-2003. However, as inventory levels began to deplete, signs of market recovery emerged.

The 64-year-old notes that between 2000 and 2002, the company primarily focused on product development without generating any sales or orders. This enabled the company to be well-prepared to capitalise on emerging opportunities once the market regained momentum.

“With no experience in the field, every step was a learning curve in the early years. It seemed overwhelming at times but in hindsight, it was a bittersweet period and was a valuable learning experience,” he says.

Foong had worked as a machine operator, construction worker, salesman, director and general manager before starting his business in 1999. His last job was as a general manager of a large American chemical company.

Foong had 15 years of experience in the chemical industry. He became an equity partner in a domestic chemical company but it lasted only 10 months due to the Asian financial crisis which forced the company to downsize. Foong decided to leave.

“My learning and experiences from previous jobs, although in unrelated fields, were not in vain. It contributed to my growth to become a better leader; in managing the business as well as people.

“I am trained to look at the technical aspects of applications but I also knew I needed to learn more on semiconductor testing. Hence, I went out to engage with customers and gradually gained traction for my services and products.

“The company caught the attention of local original equipment manufacturer (OEM) customers and we began to work with them,” he says.

In 2008, the company was listed on Mesdaq before transferring to the Main Market of Bursa Malaysia at the end of 2022. The challenges did not end there.

“At that time, headwinds like the subprime mortgage crisis in the US and soaring oil prices reaching about US$150 per barrel continued to impact the market.

“Our share price did not perform well, and orders declined due to global issues. We also encountered cost overruns, particularly during the construction of our factory in 2008 and 2009 due to escalating steel bar prices,” he says.

Foong, who enjoys playing badminton and lately golf, says his family members are his biggest supporters. Foong does not intend to retire anytime soon, saying he still has much to accomplish in JF Technology for it to become one of the top technology companies in Malaysia.

“When you achieve a certain milestone, you may think this is the peak. But actually there are greater heights to scale and bigger horizons to attain,” he says.

JF Technology is all set to embark on its next phase of growth, dubbed JF 4.0, as it continues to move up the value chain and build market share. The company is eyeing to be a strategic investor, mainly through joint ventures as well as mergers and acquisitions (M&As).

Foong says JF 3.0 entails vertical integration with engines of growth like its traditional business (test socket), the setting up of a manufacturing factory in Kunshan, China, the establishment of JF Test Sense, the introduction of new products, small M&As and licensing.

JF 4.0 will focus on business development and investment so that the company can take on more big ticket investments.

Thus far, the group has made one acquisition when it bought the entire equity stake of Ikeda Technology (M) Sdn Bhd for RM4.5mil in 2022.

The year 2023 marked another significant milestone for JF Technology as it formed a joint venture with HFC Industry HK Ltd, a subsidiary of Shenzhen HFC Co Ltd (Shenzhen HFC). Shenzhen HFC is a pioneer in graphene heat dissipation, especially for artificial intelligence (AI) chips and electromagnetic shielding.

JF Technology is eyeing the dynamic semiconductor market in China, where the group is expecting a three-digit growth through its subsidiary, JFH Technology (Kunshan) Co Ltd.

China, in its efforts to become self-reliant, is dolling out huge investments to bolster its domestic semiconductor capabilities. As such, the group aims to capitalise on this growth momentum, particularly in areas like 5G technology, AI and electric vehicle (EV).

In 2022, JF Technology announced that it will be setting up test contacting centres of excellence in Malaysia and China. Foong says there will be seamless access to manufacturing recipes, technological insights, intellectual property and know-how between the two centres through a twinning programme.

Through this collaborative approach, knowledge is transferred efficiently and the group’s operational effectiveness is maximised.

The Malaysian test contacting centre of excellence, in JF Technology’s headquarters in Kota Damansara, Selangor was established for about one and a half years ago. The one in China is slated to be in the group’s manufacturing facility in Kunshan.

Based on geographical markets, Malaysia and China contributed 33.1% or RM15mil and 30% or RM13.6mil respectively to the total turnover of the financial year ended June 30, 2023. Other Asian countries and the United States contributed RM13.3mil or 29.4% and RM3.4mil or 7.5% respectively.

Foong says producing test contacting solutions involves a high level of customisation and also entails a long qualification time, especially for automotive ICs. This means that a lot of research and development is carried out which translates to the high level of patent ownership has.

JF Technology has thus far filed 96 patents across multiple countries, specifically focusing on 5G and automotive testing applications, and 42 patents were granted. In the past year alone, the group filed 19 patents with five applications approved. It hopes to surpass the 100-patent application mark this year.

Foong predicts strong growth for the business of manufacturing and assembling test probes and test sockets in 2024. As inventories are expected to bottom out by the second half of this year, the global tech industry is expected to experience a resurgence.

Furthermore, optimistic forecasts indicate that the semiconductor market will grow in 2024. This positive trajectory is further bolstered by China’s substantial investments in semiconductor technology. Likewise, the US is actively investing in bringing jobs back to its shores, leading to heavy investment in semiconductors.

“As semiconductor fabrication plants are built in the US, Europe and Asia, opportunities for growth abound for companies like JF Technology that are involved in manufacturing semiconductors,” he says.

This article first appeared in Star Biz7 weekly edition.
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DATUK Foong Wei Kuong founded JF Technology Bhd from his kitchen at home in 1999 without an office, employees or customers. It had been a one-man show until he hired his first employee a year or two after setting up an office in 2003.