Archive for August, 2012

We don’t do enough to help entrepreneurs recover. We have incubators coming out of our ears, but what about a recovery system? Entrepreneurs are a valuable resource, but failing is a depressing moment. I’ve done it a few times and there’s no support, and no help — you’re essentially abandoned by the system.

Nobody talks about failure — it’s really the wrong language in Ireland, and has horrible connotations. Saying “embrace failure” is like saying “lick a razor blade” — it sucks. Don’t fail. A better meme than “fail fast” is “learn fast”. Try not to fail, use your mistakes to move the proposition forward and move on.

It’s going to happen to everyone. The lucky ones knock it out of the park the first time.

How has startup culture evolved in the last few years?

I started my first startup in Ireland in 2002. There were four or five enterprise platforms, and there was no equity. They were year-long programmes. And this predates social networking, so you had all of these people working in isolation. Social networking, which really kicked off in 2004/2005, made linking and group forming ridiculously easy.

And then there’s the development of true incubators: Startup Bootcamp, Dogpatch, Launchpad. They have money, and they’re short and aggressive. They get you started and get you some cash to get off the ground.

In 2002 you had nothing to fund your business unless it was friends and family, or you were wealthy. Now if you have an even half-decent idea and some coding ability, you can pick up about 50,000 for free in about ten different places. That’s huge and it broadens the base.

Enterprise Ireland wants a billion-dollar company that goes public and returns lots of cash and creates huge employment. You don’t build that by building one company, you build a base of companies where VCs have successful exits. You start with a million, then 10 million, etc. You’re not going to invest in a company today and it’s a billion dollars tomorrow.

It needs to be a 50- to 100-year vision, and you need to create a lot of entrepreneurs. The more you create (and help them recover when they fail) the more likely you are to get those billion-dollar exits in 20 years’ time. It’s a pyramid: you have to build it from the base up, and not the top down.

What’s the most frustrating aspect of it?

There’s still a funding gap. The early stage funding is pretty much solved – you can get 50 or 100k relatively easily, but there’s still a colossal gap between that and the first 500k to 2 million euro investment, and it’s tricky to cross.

And people don’t understand the cost of building a consumer business. You have to figure about ten dollars per user, and we don’t have the funding structures in place to outperform competitors in the US. A guy in the US is going to raise money faster, and he’s going to outspend you in consumer acquisition.

It’s hard to be competitive in the Irish marketplace – you have to put your CEO somewhere like Silicon Valley. For example, with Intercom.io, Eoghan McCabe raised angel funding. He’s moved to the US, but the engineering team is here. It’s not a consumer product, but it has a lovely viral model and a compelling offering, targeting businesses. It’s a lot easier to sell to enterprise because they have more money to spend, and you need fewer customers to make your targets.

And what’s the most exciting?

What’s really exciting are businesses emerging in the last four or five years: Orchestra and Engine Yard, Intercom. And then people like Robin Blandford, with Decisions for Heroes, which is a service for emergency response teams, and has this clever vertical marketing. There’s also WhatClinic, which is a medical clinic search. It’s had seven quarters of growth, they’re hiring in Dublin, and they’re making a profit – WhatClinic doesn’t even need investment anymore.

What do you think startups in Ireland need most right now?

The thing that people are worst at is customer acquisition. That means managing, costing, analyzing and understanding how customers get acquired. You need to know which cohorts will give you money, and which one are kicking the tires.

The judges awarded their prize to Barry Slattery’s Linking Learning, a simple-to-use service that helps link classroom learning with home curriculum support. The public vote prize using the Swequity Dollars went to Lynne O’Donnell’s Tempity, the online temp hiring service that makes it easy to build a flexible workforce.

Life after Swequity

 Both Barry and Lynne will take their ideas forward, but all of the teams are pitching for NDRC’s LaunchPad, and all will get further support from Inventorium if they choose it.

We’ve enjoyed watching teams inspire each other and really use their teammates, colleagues, and mentors to help them meet their own expectations. That was no accident.

The point of our Swequity Exchange was not to find the next big thing. Sure, we’d love to help the team that builds the next billion-euro business. But you don’t create a community of entrepreneurs by focusing on the big gambles, and it’s not how you cultivate real innovation.

You need to break a sweat. And you need to build networks.

The point was the training — the burst of speed that helps you build the strength you need — not the race itself. We wanted to help our teams learn to break the right kind of sweat, to learn how to approach ideas, pivot on a dime if necessary, and learn when it’s time to walk away from a concept that just isn’t viable.

We believe that the more we can help the right people meet each other, and the better we are at pushing a lean approach to validation, the better we’re doing at making ideas happen.

That’s why we’re so pleased to see the kinds of links that were made, and we hope we’ve increased the chances that the next great startup idea will find the right team.

If you’d like to find out more about our next Swequity, or about any of the projects or teams who participated, get in touch fiona@inventorium.org

The eight finalists

Rentable: An online network for tenants to share real information about rental properties. Founder Claire Roche’s plan to compile rental histories of houses, flats, and apartments in cities around the world appealed to anyone who has ever seen a “bijou” apartment or a “compact” flat, or dealt with an absentee landlord.

FabLab: A personal fabrication service. FabLab Dublin will offer precision milling, 3D printing, and laser cutting, which will help businesses and individuals make prototypes, replacement parts, and small runs of products. They’ll also offer consultancy, training, and membership for people who want to use FabLab to make their wild digital ideas into real things.

Stamply: A loyalty card system for your smartphone, which allows you to collect reward points for multiple small- to medium-sized businesses. Merchants don’t need extra hardware, and all customers need to do is download the app. Stamply even lets users know when it’s time to cash in their points for rewards.

Linking Learning: This online service makes it easy for primary school teachers to share information about topics and learning outcomes, and provides tips and feedback that helps parents reinforce classroom learning at home. Barry Slattery’s concept was focused not just on being useful, but on creating something that is incredibly easy for teachers and parents to use.

Distillr: This is a management system for cleaning, hosting, and processing open data. This doesn’t sound so sexy, but, as founder Brian Daly noted, 42% of apps use open data, and that data is stored in all kinds of formats, and in all kinds of places. Distillr makes it easy for developers to standardise and clean datasets, so they can focus on building solid apps with a great user experience.

Gotcha Ninjas: A social game that allows students to rack up points for achievements and good behaviour, and exchange them for rewards. It reduces the amount of time teachers spend dealing with classroom discipline. Educator and founder Tony Riley tried an offline version of this and saw a significant drop in absences.

Tempity: An online temp service that takes the stress out of hiring a temp, and makes life easier for temps. It offers skill-matching, a rating system, and availability tracking. Temps sign up and confirm availability on days they can work, so that companies only see the names and details of temps who are actually available. It’s also cheaper for companies to use, and lets temps get a higher hourly rate than with conventional agencies.

Listen to it Later: This music aggregator and bookmarking tool allows users to collate and share music from different online streaming services into a single playlist. Listen to it Later is already up and running in 30 countries, with a few hundred users. They see themselves as a kind of Instapaper or Readitlater for music.