Want to build a start-up business network?

 ‘Wasn’t he very lucky that he met that investor.’ or ‘Wasn’t she lucky, the way that customer contacted her out of the blue.’  How often have you heard comments like that about successful business owners? But all too often it’s down to hard work, not luck. Successful business owners work very hard to build robust business networks, networks that provide access to customers, investors, advisors and others who are in a position to support the development of the business.

So what should you do to build your start-up business network?

Sowing the Seeds

First off, set targets. Just three new contacts every week adds up to 150 by the end of the year, that’s 150 people who can support and guide the development of your business. And if every one of those contacts is connected to 150 others, that’s a network of 22,500 that you have access to within just 12 months. That’s powerful.

Start with people you already know. Make a list of school friends, college friends, former work colleagues and members of your extended family. Let them know about your start-up. Tell them what you are doing and that you’d welcome their support.

Take a fresh look at those that you meet in your day-to-day start-up activities. If you are on an incubation programme, you’ll meet fellow entrepreneurs, trainers, mentors, guest speakers, enterprise agency executives, investors and more. We have over 100 contributors to every IGNITE programme. That’s a network in itself!

And get out more. There are a wide range of business events, many with a focus on start-ups, happening every week. From breakfast briefings to daytime conferences to evening talks, there is no excuse not to get to one event every week and no reason not to add at least one new contact to your network from every event.

Cultivating the Crop

It’s really important to follow up immediately. A personal email or text, a request to connect on social media or even an old fashioned hand written note, received shortly after the meeting, makes a big impression.

Maintain a database that records name and contact details with maybe a note on the context of the meeting. There are lots of good Customer Relationship Management packages out there but an excel spreadsheet does the trick just as well, at least at the start.

Look for ways to follow up. The reality is that people help people they know and like, so they must get to know you (and they must like you)! In some cases it might be a follow up meeting over coffee or lunch, in other cases it might be a short chat at the next event. In all cases make a point of putting out regular updates by email or on social media. It’s very important to bring people with you on your start-up journey. Just three or four updates a year is all it takes.

And most important of all, remember that it is not a one way street. Keep an eye out for opportunities to help others. An introduction to a prospective customer, a link to a relevant website, the name of a useful book, a recommendation of a pertinent article are all great ways to develop relationships.

Reaping the Harvest

And when it comes to the request, it’s important to be as specific as possible. ‘Can you introduce me to Joe Bloggs at Acme Venture Capital?’ is a far better ask than ‘Can you introduce me to any VCs that you know?’

Make it as easy as possible for them to act. Providing a business profile and with a short cover note to be forwarded is far more likely to produce a result than if you leave it to your contact to write it.

And it’s always worth asking if they know anybody else who can help.

Finally, don’t forget to thank them for their help and to let them know the outcome. There is nothing that motivates a good business contact more than knowing that you took full advantage of the help they offered.  And the more feedback they get, the more likely they are to respond to future requests for help.

And a last word of advice. The Irish start-up community is well connected. Never underestimate how far a reputation, either good or bad, will travel.

Eamon Curtin is Director of the IGNITE Graduate Business Innovation Programme, UCC. http://ignite.ucc.ie

Startups! Forget Your Business Plan For Now!

People are often surprised when they hear that we don’t require a business plan as part of the IGNITE application process.

We subscribe to the view that unless someone has actually developed a product concept: a prototype, a demo, a wireframe, a simulation, something that they can put in the hands of customers AND has interviewed lots of potential customers AND has sold or is on the point of selling something to someone, a comprehensive business plan is based on nothing more than assumptions, guesses, hopes and, worse, dreams.

As such, while a comprehensive business plan does stand testimony to the hard work and commitment of the promoter, it is pretty much useless as a reliable roadmap for how the business will develop.

This approach is based on the ideas of four guys: Steve Blank (http://steveblank.com/), Ash Maurya (http://spark59.com/), Eric Ries (http://theleanstartup.com/) and Alex Osterwalder (http://alexosterwalder.com/). All four collaborate in various ways and their ideas overlap.

In essence, Steve Blank’s key idea is that the most successful start-ups are the ones that concentrate on customer development rather than product development. In his book, The Four Steps to the Epiphany, Steve describes the first two steps as Customer Discovery, making assumptions about who the customer is and why they’d buy from you, and Customer Validation, finding ways to test those assumptions and prove them to be true. This is often an iterative process, discarding old assumptions and forming new ones until you arrive at a set of established facts about your customers. Step Three is
Customer Creation, identifying customers, engaging them and signing them up while Step Four is Company Building, putting the resources and processes in place to grow the business.

Ash Maurya takes a slightly different approach which he describes in his book Running Lean. He advises first identifying a problem and then defining the solution to the problem. This is Problem-Solution fit. The next step is to identify the customer that has the problem – Product-Market fit. Once you have a well-defined customer, a clear problem and an effective solution, you are ready to start to build the business.

A key idea of Eric Ries is that start-ups should move as quickly as possible to a point where they have something to engage the customer: a prototype, a demo, a wireframe, a simulation, something that allows you to assess how the customer actually uses the product rather than how they say they would. (And there can often be a big difference!) Eric describes this and much more in his book The Lean Start Up.

Meanwhile, Alex Osterwalder developed a framework using 9 building blocks that can be used to develop a business model. The first two of these blocks are Customer Segments and Value Proposition, in other words, who are your customers and what are they buying from you. See the overlap with the ideas of Eric and Steve? The other building blocks work their way through Customer Relationships, Channels, Revenue Streams, Key Activities, Resources, Partnerships and Costs. Alex has described this model in his book, Business Model Generation.

Needless to say there is a lot more involved, but that’s the essence of it right there.

Steve Blank posted a blog earlier this year: Blowing up the Business Plan at U.C. Berkeley Haas Business School http://steveblank.com/2015/03/03/u-c-berkeley-haas-business-school-blowing-up-the-business-plan-the-lean-launchpad-i-corps/.

I was particularly taken by his description of what it’s like in the early stages of starting a business:

“Being an entrepreneur is about starting out with no idea whether you are working on the next big thing or something no one wants and certainly no one will pay for. It’s struggling to find the right path forward through chaos and uncertainty. Killing bad ideas quickly and moving on. Staring at the phone while mentally wrestling to pick it up to make that next cold call. It’s having investors tell you that you’re dead wrong and, perhaps with enough customer traction, showing them the path to a new future neither of you could see at the time.”

This is the starting point for IGNITE and we adapt the ideas put forward by Steve, Ash, Eric and Alex to help entrepreneurs through this early phase and on to running a successful start-up.

For more, I highly recommend taking a look at Alex Osterwalder’s Tools for Business Model Generation on YouTube at https://www.youtube.com/watch?t=105&v=8GIbCg8NpBw.

And Steve Blank has a great How to Build a Start Up course on http://www.udacity.com. Just sign up to udacity and search for ‘How to Build a Start Up’.

Finally, if you are a Harvard Business Review subscriber, there is a comprehensive summary Why the Lean Start-Up Changes Everything at https://hbr.org/2013/05/why-the-lean-start-up-changes-everything/ar/1.

PS: Not to be outdone, I have put together my own 5 Questions Every Start Up Should Answer: Who is your customer? What is their problem? How does what you are offering solve their problem? What is the solution worth to them? How many customers are there? More on this at https://igniteucc.wordpress.com/2015/04/14/5-questions-every-start-up-should-answer/

Profit without Passion?

Great insights from Greg

Greg Canty Fuzion Blog

These two guys came into us, full of confidence about their new project.

They were introducing a new range of ready made meals to the Irish market, which they reckoned were going to be a huge success.

The market in Ireland was huge and growing and according to them poorly serviced with inferior products. They were going to bring restaurant quality meals with recipes designed by a high profile chef using the best of Irish ingredients.

These meals were going to be well packaged and would be ‘on shelf‘ at competitive products – this was their recipe for success!

By their reckoning they would conservatively capture a share of the market and even with moderate success they would make a fortune, it was guaranteed.

They had the listings with some of the multiples and our job was to launch the new range of products. They also had a…

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5 Questions Every Start-up Should Answer

One of the highlights of my job as Director of the IGNITE Graduate Business Innovation Programme at University College Cork is that almost every day I meet young people with wonderful ideas for new products and services. Often they have a thorough understanding of a particular technology or area of research and have spotted an opportunity to develop a great new offering.
But, as all too many people have discovered, great product ideas do not necessarily make great businesses.

I often ask these young innovators to tell me about their business idea without referring to the product or service. Many struggle to come up with more than three or four sentences before saying something like: ‘our product is a.…’ or ‘the platform will…’.

But this is a really valuable exercise. It forces the aspiring entrepreneur to consider the business idea from the point of view of the customer and helps develop an understanding of the product-market fit, the relationship between the product or service and the customer. After all, it’s great product-market fit that makes for great businesses.

More often than not, I encourage these future business owners to consider five questions:
– Who is your customer?
– What is their problem?
– How does what you are offering solve their problem?
– What is the solution worth to them?
– How many customers are there?

Who is your customer?
The lazy answer is that everybody is a potential customer. But the wider the range of customers to please, the less relevant the product becomes to any one of them. It’s important to be able to describe one or more narrow groups of target customers.

Business customers can be described in terms of industry sector, size of company (turnover or employment level), age or phase of development of the business, location and more.

For consumer products, customers can be described in terms of demographics (age, gender, income levels), geographics (where they live or work) and psychographics (beliefs and values).

It is always worth remembering that business decisions are made by people, so who are they?

What is their problem?
A great question to consider is ‘what is it that keeps your customers awake at night?, literally! What are your customers so concerned about that it affects everything they do?

Business owners are concerned with getting new customers, keeping existing ones, managing costs, keeping cash flow under control or complying with regulations and legislation.

Parents are striving to provide the best for their children.

Teenagers want to fit in.

Every ideal target customer group shares a critical problem that needs a compelling solution.

How does what you are offering solve their problem?
The trick here is to adapt the original product or service idea so that it solves the customer’s problem. So a social media marketing company is really about helping a business increase sales while a cloud based health & safety training programme supports business owners comply with legislation. A nutrition advice website helps parents provide better for their children, and a social media application allows teenagers to interact, share with their friends and be part of the gang.

What is the solution worth to them?
The key factor here is how big a problem is it. If the problem is really keeping your customer awake at night, it’s a big problem. Sometimes the value of the solution can be quantified, especially if it can be shown to directly result in increased sales and higher profits. In other cases it’s more subjective, and often emotional- what would a parent pay to avoid the regret of not giving their child the best start they can? In general, the bigger the problem and the more compelling the solution, the more the customer will pay.

How many customers are there?
It’s really useful to define the market in terms of Total Available Market, Serviceable Available Market, and Serviceable Obtainable Market: TAM, SAM and SOM. TAM is the total number of customers anywhere in the world; for example, the total number of owner managed businesses or the total number of parents with young children worldwide. SAM is the proportion of these that you can reach given your specific product offering and distribution channels – the total number of owner managed businesses in Ireland, for example. While SOM is the percentage of these that can realistically be captured given the competitive nature of the market. What is the Serviceable Obtainable Market for your business?

This is an iterative process. It’s necessary to work through this sequence of five questions a number of times, fine tuning the answers as you go in order to develop a sustainable business model. Of course, this is just a first step towards starting a successful business, but what a great start it is.
Eamon Curtin is Director of the IGNITE Graduate Business Innovation Programme, UCC. http://ignite.ucc.ie

Why I left my career as an Alumni Director and joined KonnectAgain

Another big step forward for KonnectAgain when they announced that they hired Liza Bennigson, Alumni Director at Menlo School, as Business Development Director in USA.

This should allow KonnectAgain access an exciting export market.

There’s a great piece here that tells the story of how they met and why Liza joined KonnectAgain.

IGNITE is now open for Expressions of Interest

It’s that time of year again when we invite Expressions of Interest from anyone considering applying for IGNITE 2016.

The EOI doesn’t require much information but it is a great way to clarify your idea and how you think the programme will help.

Apart from contact details, qualification details and where you first heard about us (asking this question is the cardinal rule of marketing!), we just want a brief description of your product or service (150 words or less) and an explanation of how you expect to benefit from the programme (again 150 words or less). Email the lot to ignite@ucc.ie.

Those with Expressions of Interest registered will be invited to a series of workshops and seminars in early 2015 that are designed to help you develop your business idea so that you can submit a more comprehensive application and be better prepared to make the most of the programme, if successful.

We’re now recruiting for our 6^th programme. And it’s interesting to see where past participants came from and how they are doing.

IGNITE founders come from a variety of backgrounds and qualifications and their ideas are inspired by research, academic studies, work experience and personal interests.

• Teagasc/UCC PhD postgraduate, Sinead Bleiel (formerly Doherty), founded AnaBio Technologies Ltd, anabio.ie, in 2012. AnaBio provides encapsulation expertise, IP generation, commercial manufacture and licensing for food, pharma, animal and human health nutrition markets. The company now employs 5, mainly research staff based in Teagasc, Moorepark and UCD. Sinead was recipient of Cork Chamber of Commerce Cork Emerging Company of the Year Award in 2014.

• Brendan Finucane, BSc (Business Information Systems), is founder of VConnecta Ltd, vconnecta.com. Vconnecta combines political experience with cloud & mobile technology to deliver an innovative voter relationship management tool. The company employs a team of 5 based in Cork City Centre.

• Richard Barrett, BEd (Sports Studies and Physical Education) and Ross O’Dwyer (BComm) are founders of Pundit Arena, punditarena.com, an online social sports platform that enables sport enthusiasts to share news and views on all matters sport. The company employs five staff and is based in Cork.

• Eoin O’Carroll and Kevin Bambury met while completing an MBS (E-Business) in UCC. They founded Portable Medical Technology, http://www.portablemedicaltechnology.com, to develop mobile decision support tools for medical professionals.

• With a BA in TV, Radio and New Media Broadcasting from the Institute of Technology Tralee, Stephanie Lynch, founded OnTheQT.ie, ontheqt.ie, in 2013. OnTheQT showcases throughout Ireland and worldwide that locals fall in love with and return to again and again. Promoting the gems through video and blog content. OnTheQT is a travel hub by the locals for the explorer.

• UCC BSc in Government graduate Jayne Ronayne co-founded UrYearBook with David Murray in 2011. The insights she gained speaking with educational institutions helped identify a new opportunity that led to KonnectAgain, konnectagain.com, co-founded with Helen Flynn. KonnectAgain helps institutions to unlock the true potential of their alumni network and create real, meaningful benefits for institutions and alumni. The company currently employs a team of 8.

Our goal is that every business is revenue generating and/or has raised investment over the duration of the programme. It’s an ambitious goal, one we work hard to achieve.

Every year, the 10 successful applicant businesses benefit from:

• A comprehensive Start Your Own Business Programme that involves:
  • About 30 days of workshops
  • Seminars
  • Guest speaker events
• Business advice and guidance from on-site business mentor
• Start-up funding and advice and guidance on accessing further funding
• Office accommodation in the IGNITE Graduate Business Innovation Centre in UCC’s Western Gateway Building
• One to one business mentoring from leading entrepreneurs
• Guidance from UCC’s ‘Coaches on Campus’
• Information and advice from IGNITE’s Industry Partners
• Access to key entrepreneur networks and regular networking events
• Support of UCC’s academic, research and commercialisation expertise

For more information and to keep up to date:

E: ignite@ucc.ie

W: http://ignite.ucc.ie

F: www.facebook.com/uccignite

T: @IGNITEUCC

L: IGNITE Graduate Business Innovation Programme

Just do it, like… Richard Barrett, PunditArena.com

Great piece here by Richard Barrett of PunditArena.com from a little earlier this year. What a year co-founders Richard and Ross have had! Bank of Ireland/IGNITE Business of the Year 2014!

IBYE Cork

Tell us a little about PunditArena.com Richard…

PunditArena.com is a Cork-based sports media website powered by articulate fans and established journalists, that I co-founded with Ross O’Dwyer. The site is making waves in the digital media sphere and 2014 has been a big year so far. Our company launched last November, and now has over 200 contributors, a sub-editorial team of six, and a further trio involved in digital marketing.  Traffic to the website has increased substantially with over 70,000 users of the product in the last month. We’ve just been named Bank of Ireland/ IGNITE Business of Year 2014 which is a great honour! 

What inspired you to start your own business? 

There was no real ‘eureka’ moment per se.  I didn’t wake up one morning and decide I wanted to start my own business. I guess it was quite progressive.

I had worked a number of jobs growing…

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Just do it, like… Glenn Goggin, Ottera

Great piece here by Glenn Goggin of Ottera from a little earlier this year. Ottera are exhibiting at the Web Summit this year.

IBYE Cork

Tell us a little about your business…
Ottera, which I founded with Kieran Desmond in March 2013, is a leader in proficiency based progression training technology for high value training such as Healthcare. Our technology in the form of video capture glasses, a docking station and clinical training software have been quantitatively proven by world renowned experts to reduce critical and non critical errors of Healthcare professional trainees by 49% and 65% respectively.

What inspired you to start your own business?
I have always looked at very successful people not in awe, but rather with curiosity, asking myself a number of questions. Why can’t I be that successful? Why can’t I achieve what they achieved? Why can’t I employ the amount of people that they employ? Why can’t I build a company as large as they did? As soon as I realised to take the word “can’t” out of the equation, I…

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Building an Effective Start Up Community in Cork?

Interested in building a startup community in Cork?

I just took another look at Prof Erik Vermeulen’s Public Lecture when he visited UCC in September courtesy of InterTradeIreland. It’s available here. Do take a look!

The Professor spoke about what it takes to build a sustainable start up community. He spoke about how Eindhoven evolved from ‘Smartest Region’ to ‘Start-Up Region’ and referenced other examples such as Boulder, Colorado in the US. (Did you know that Eindhoven has a population of about 200,000 and Boulder’s is just 100,000?).

Vermeulen’s opinion is that those that try to replicate Silicon Valley will fail. (We know what the ingredients are but we don’t know the recipe!)

He highlighted a number of factors he believes are essential to build a sustainable entrepreneurial community:

• Differentiate: Successful regions will take stock of strengths and build on them. Eindhoven has built it’s success on hardware development, a strength derived from Philips considerable presence over many decades.
• Collaborate: Successful regions will have high levels of collaboration and transparency between all partners – entrepreneurs, local authorities, universities, industry, investors and service providers.
• Connect: Successful regions will be highly connected with international accelerators and VCs.

Vermeulen also referenced Brad Feld’s Boulder Thesis derived from the experience of Boulder, Colorado. (There’s a great must-watch video here.) He believes that for a sustainable start-up community:

• Entrepreneurs must lead the startup community (all others are feeders and feeders can’t be leaders)
• The leaders must have a long-term commitment (think 20 years, it’s a marathon not a sprint)
• The startup community must be inclusive of anyone who wants to participate in it (everybody brings energy)
• The startup community must have continual activities that engage the entire entrepreneurial stack (like accelerators and start-up weekends, more substantive than awards dinners and cocktail parties).

So where do you think we stand?

A Term Sheet in Plain English!

I’m still working my way through some of the excellent material shared by Prof. Erik P.M. Vermeulen at last week’s InterTradeIreland supported All Island Innovation Programme Series of Master Classes at UCC.

Over the course of three workshops and a public lecture Prof. Vermeulen spoke about the factors that characterise a high performing VC (visibility, hyperactivity and disruptiveness), noted an increasing use of convertible notes in early stage funding, warned about possible over valuing of tech start-ups by SV based VCs, told the story of the FACEBOOK IPO and explained how Eindhoven developed a start-up culture. A lot to take in over four 2 hour sessions!

Prof Vermeulen also spoke about VCs taking steps to become more open, more transparent. He noted the Plain English Term Sheet that is currently in use by Passion Capital (www.passioncapital.com) and encouraged others to follow. A short extract helps understand exactly what they mean by Plain English (It does exactly what it says on the tin!)

[Date]
Passion Capital Term Sheet for [Non-Hipster Limited]
We, Passion Capital LP, want to invest money in your company, [Non-Hipster].

Structure of Financing
We’re making you an offer of a £ [ ] investment as your seed round. This investment will be for [ ] % of the ownership in your company. Your company will issue to us the same type of common shares that you already have.

Option Pool
Our offer assumes that you’ve already or will set up an employee stock option poll before our money goes in, so that our ownership is “fully-diluted” after accounting for that option poll. We think you’ll need at least a 10% option poll after the investment round in order to hire some key management team members and senior people. To make this really clear, see the attached table to see how this looks with actual shareholding and ownership percentages after the investment.

Conditions to Close
Before we sign the paperwork and transfer our money, we have to do some basic due diligence on the company and also on you, the founders. This includes anti-money laundering checks and having you complete a Founder’s Questionaire. We also want to see that all of the company’s relevant employees and freelancers have signed employment or similar contracts which make it clear that the company owns all of the intellectual property that’s been created for the business you’re building.
At the same time, if you haven’t already done so, you should also do a bit of due diligence on us. For example, speak to some of our existing founders and get a feel for what they think of us. We’d be glad to make introductions if it helps.

Estimated Closing Date
We’ll use our standard legal agreements which you should review, preferably with a lawyer to help (and again, maybe also speak to a couple of founders who will have seen and agreed to the same docs). We hope that we can wrap this all up and finish the investment round with signed paperwork and money in your account no later than 4 weeks from today, [date].

…….

You can find the full Term Sheet at http://www.passioncapital.com.

Who is Prof Erik P.M. Vermeulen?

Professor Vermeulen is Professor of Business and Financial Law at Tilburg University and Tilburg Law and Economics Center (TILEC) in the Netherlands. He is also Senior Counsel Corporate/Vice President at the Corporate Legal Department of Philips International B.V. in the Netherlands, where he advises on corporate governance issues, including the global corporate structure of the Philips Group of companies.
In addition to the focus on corporate governance, he has extensive experience in mergers and acquisitions, corporate finance projects, and general corporate and securities law matters.
He has worked on international projects related to corporate venturing activities, corporate venture capital and spin-out transactions. He is a founding council member of the International Venture Club, a collaborative platform that brings together risk capital providers that aim to support small and medium-sized enterprises (SMEs) in their efforts to achieve their full growth and potential. You can get the full profile at https://www.tilburguniversity.edu/webwijs/show/e.p.m.vermeulen.htm.