MANILA, Philippines—At 72 years of age, Gene Yamagata is no wide-eyed greenie when it comes to personal finance and entrepreneurship.

While the fall of Wall Street continues to decimate people’s savings and threaten businesses, the Las Vegas-based, Japanese-American multimillionaire has been touring Asia finding diamonds-in-the-rough-microentrepreneurs he can give a hand to and keeps his eyes open to new business opportunities.

It’s not that his personal wealth and businesses are spared from the global financial crisis. With his US investments in real estate, hotels, automobile dealership, banks and insurance, among others, and his Japanese operations in healthcare suffering steep drops in gross revenues, Yamagata’s strategy of giving even if it hurts may not make much sense to anyone at first. But, his team says, this is not his first time.

“Even during those times when he was having difficulties [starting his business in Japan], when he had nothing and he slept under his desk at work because he had no place to go, he supported me,” says John Nitta, a nephew, in an interview. John is now vice president of the Yamagata Corp.

Having three older deaf siblings, Yamagata had been asked by his mother to take care of his family. Aside from making good on that promise for years even under financial stress, he also visits and takes care, at one point, of 13 other families in Las Vegas not related to him as part of his community service commitments for The Church of Jesus Christ of Latter-day Saints.

$6 million endowment

On top of that, the Yamagata Foundation’s $6-million endowment for the Brigham Young University in Hawaii has been instrumental in helping Filipinos and other Asian students, through an internship program, to go back to their home countries and bring back their talents instead of working in the United States.

Yamagata’s brand of giving will also help the likes of Aaron Jeffrey Nolasco, owner of Ink2Go Ink Refilling Station based in Cebu City, who bagged the Master Entrepreneur of the Year Award last weekend sponsored by the Foundation.

“I wanted to become a better provider for my family and decided that I would try to build a business to do it. With P150,000 borrowed capital in March 2005, I decided to go into the ink refilling business and studied how to offer a good service to my clients,” says Nolasco, 32, during the deliberations. Nolasco is now looking forward to franchising his business and started another one—a restaurant—with his mother and siblings.

The awards is a joint project of the foundation and the Academy for Creating Enterprise, a Cebu-based entrepreneurship school helping micro-enterprises all over the country in all levels—from creating business plans to bringing their businesses to the next level and sustaining them.

The competition also gave awards for social entrepreneurship, youth in business, start-ups, women entrepreneurs, innovation in retail businesses and LDS entrepreneur of the year.

Winners

One of the judges was Wilson Ng, owner of Ng Khai Development Corp., a recipient of the Ernst & Young Small Business Entrepreneur of the Year Award in 2004.

The academy and the Yamagata team waded through 1,500 financial statements and business plans in the last two months to find shining examples of entrepreneurship in a bid to spur activity among micro-entrepreneurs from Luzon to Mindanao and motivate them to do better.

Some of the other winners were Olivia Dagohoy from Malaybalay, Bukidnon, who operates a drugstore, Joseph Castelo from Cabanatuan City whose Jack Arts and Signs Shop carries a tagline of “Personalan na ’to” and provides desktop publishing services.

Asked why Yamagata gives money when everybody else is trying to cut back on spending, preserve capital and wait for the dust from the crisis to settle, a close colleague and church mate says Yamagata, who has a soft spot for Asian countries, wants to give back meaningfully.

“Mr. Yamagata comes from humble circumstances; the son of immigrant parents who were farmers in Idaho, and I think he knows what it takes to rise and be successful. The opportunity to give back particularly to Asian communities is very important to him,” says David Senior, chief executive officer of Pronaia Capital Partners Ltd., the investment arm of the Yamagata group.

“We consider that the best investment somebody can make is in talent. Not in products, services or manufacturing capabilities. The human capital is the most important thing you can invest in. That’s where the rubber meets the road, that is where most of the work happens,” he says.

The team was originally looking at Taiwan, Vietnam and Japan, but decided to sponsor the awards in the Philippines instead.

“We are very impressed so far … and if we find that there are good business opportunities here, we might consider setting up operations in the country,” says Senior. He adds that another compelling reason why they chose the Philippines is the huge success of the LDS church’s missionary work in the country, resulting in an overall membership of 600,000, at a growth rate that is one of the highest in the world.

Personal finance principles

Talk of a prolonged recession in the United States, and consequently the rest of the world, has yielded a flurry of advice to cut back on spending, pay off debt and stock up on cash. While these may help in days of difficulties, they work best when started during good times.

These Holy Grails of personal finance allow people like Yamagata to continue lifting people by their bootstraps especially when cash is most needed. “I spend so much more than Gene (Yamagata) when it comes to clothes and meals and entertainment,” his chief financial officer, Steve Nielsen, says.

He adds that Yamagata’s investments are highly diversified, his debt is low and his cash levels are high, that is why he can afford to be looking for business opportunities that may already be at good prices.

Some say it could take one to two years for the United States to get out of the doldrums. That means more people would need financial help. In the Philippines, that usually means going to relatives or friends for cash needs. Oh wait, let’s not forget depending on grown children for old age needs.

If you are the one in need of assistance, experts advise putting the personal loan down on paper, whether or not it carries interest. Nannette Ferreria, a registered financial consultant, also recommends taking the initiative to suggest monthly payments and deadlines and signing the documents.

“It shows that you don’t have any intention to forget the loan by legitimizing it with an official, signed document. If you suggest paying interest and deadlines, it also gives you a chance to feel better about the whole thing, because then it becomes a transaction and not utang na loob,” she says.

Making good on personal debt payments ensures that money matters do not strain relationships. It also allows you to keep your personal credit lines open in the event of future crises.

The same goes for people who are called upon to lend a helping hand.

“In the Filipino culture, when you lend money ikaw pa ang nahihiya,” says Ferreria. She advises asking the person to sign, and calling him on the day he is supposed to pay, not because you are running after the money, but to teach the person values of integrity and responsibility.

“It takes a lot of effort and emotional energy just to approach someone for a loan. There are a lot of things at stake. But when you are able to pay, it gives you a good feeling because you redeem yourself,” she says.

When it becomes difficult to pay up even after doing your best, make sure you contact your creditor first before he contacts you. Experts say that shows your sincerity and makes for a better relationship, much better than avoiding your parent, brother, sister or friend.

Ferreria advises those who try to lend a helping hand to look at your cash position to be prepared, just in case the loan doesn’t get paid. “There have been times in the past when we have accepted that the amount is giveaway already,” she says.

That’s why choosing carefully who to assist is also a crucial part of helping out.

Academy founder Stephen Gibson says he chose to set up the school in the Philippines and help Filipinos because of three things: the Filipinos’ great need, skill in speaking in English and the people’s open and fertile minds.

Academy’s chief operating officer George Andrew Barfuss adds that a few hundred families based in Salt Lake City finance the courses for Filipinos (around $1,000 per person), but expect Filipino students to pay their part, even if it’s just P2,500.

In this sense, giving out money becomes an altruistic investment on talent, and not a dole-out. That is also the principle behind the Yamagata Foundation’s entrepreneurship programs.

Crises and entrepreneurs

Asked whether business owners should be scared of the current crisis, Yamagata says entrepreneurs need only to work harder, solve current problems and get over them.

“It’s amazing how you start a business and there is always something that comes up that causes some sort of a crisis, big or small. You just have to work at it, solve it, and get over it. Don’t give up just because a roadblock comes along,” the rags-to-riches millionaire says.

Yamagata also says it doesn’t matter what industry your business is in, if it’s managed well, it will survive.

“Work very hard at what you believe in. Once you start something, don’t give up. Perseverance and longevity are very important,” he says. It took Yamagata three years to get his business in Japan up and running, and if he gave up, he would have missed the opportunity to rake in gross revenues to the tune of $500 million a year (now down to $300 million due to the crisis).

“It’s not how you manage when times are good. It’s how you manage when times are hard,” says Nielsen. “We’ll take on good managers in a mediocre business rather than good businesses with mediocre managers, any day,” he adds.

Nielsen also says the crisis may open up the market for smaller, more nimble businesses as big companies fail. “Smaller companies are more nimble and more flexible and you will see them picking up customers and navigate the difficult times much better because they have no massive overhead costs,” he adds.

Money matters are sometimes considered hard and cold, but remembering that people come first can unlock more possibilities for the kind of savings and investments that benefit you more meaningfully in the long term—the one of giving even when it hurts.

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