Tag: business development

Business strategy why it matters and how to do it

Business strategy: why it matters and how to do it

Business strategy why it matters and how to do it

Years ago, when the internet was in its infancy, I was part of a study group that developed a business plan for Intergift, an online shop that would sell books, CDs and other ‘gifts’, complete with reminders for birthdays, anniversaries. Sounds familiar? A year later, Jeff Bezos would start a company called Amazon in his garage.

The point is that loads of people have a great idea. It’s the people who make a decision to prioritise and act on the idea – and then stay with it – who reap the rewards. We did actually set up a company and made some attempts to get something off the ground. However, looking back, what prevented us delivering on a great idea was not dedicating enough time to it and not setting ourselves any goals or action plan, which all resulting in us just not doing it.

Why strategy?

The starting point for a lot of organisations is that people are too busy working away at an operational level making day-to-day things happen. Sometimes, people think they have a common understanding of where the organisation is going, but often – with some probing – it becomes clear that they don’t. Often, ideas about what the organisation might do to support growth are floating around and are either not acted upon at all, or are acted on in an ad hoc way, depending on the forcefulness of the originator of the idea. The development of a proper strategy has the effect of facilitating a common understanding of where the organisation is going, how it’s going to get there and what goals and action are required to make that happen. A lovely analogy I’ve seen is that of a magnet lining all the iron filings up to point in the same direction.

There are various schools of thought on how important goal-setting is in achieving results. Some argue that if you have a strong vision, everything else will fall into place; others, to varying degrees, argue for the necessity of setting goals and developing action plans to deliver those goals. While I’ve no doubt that people have achieved amazing things through vision alone, setting goals and developing action plans generally provides focus and yields better and faster results.

What do you want?

Consider how you would answer the following questions:

  • What’s your organisation’s VISION?
    That is, what change do you want to see in the world?
  • What’s your MISSION?
    In other words, what is your role in that change?
  • What’s your TOP LEVEL GOAL?
    What is your more specific, measurable, time-bound goal?
  • What STRATEGY are you going to pursue to deliver on that mission?
    What strategic objectives will you set to support that overall strategy? What actions are necessary and when? Who else needs to be involved? How will you measure success?

What’s important to you?

But before embarking on any of this, it’s important to ensure that what you’re setting out to do is in harmony with your values.

Values are principles, standards or qualities we hold to be important. Those cited frequently include integrity, innovation, and family… however, there are a whole host of possibilities, for example: money, success, freedom and loyalty. There is no point in pursuing a mission or goal that conflicts with your organisational values as, eventually, something will give, so it is very important to spend some time identifying values upfront. For example, if conservation or environmental protection is a priority for your organisation, then pursuing goals that conflict with these will not sit well and is unlikely to be successful.

How to build a strategy – the process

Once you’ve defined your values, you can work your way through the process shown, determining your vision and your mission, as defined above. For example, your vision may be that the expected standard of coffee in Ireland would be the same as that in New Zealand and your mission may be to be recognised as the best local cafe(s) in Ireland. Then, it helps to step back and do some analysis, both of the context and of your organisation. What’s the environment like? What forces are at play? What are the key success factors for the industry? How well do you perform versus your competitors? A gap analysis will highlight the knowledge, skills and resources that will help you get from A to B, but also the constraints within which you may have to operate.

There are some great tools to help analysis and understanding of your organisation, for example, a simple SWOT analysis, Osterwalder’s Business Model Canvas, and the ‘Prevailing Logic’ tool.

Next, step back again and take some time to generate some ideas for possible goals and actions that will help you achieve your mission. Again, there are lots of possible approaches, but good old-fashioned brainstorming with a pen and some post-its is still very effective.

It’s now time to define your top level goal – what’s a time-bound, measurable goal you can set yourself in pursuit of your mission? For example, you may decide that you will open your first cafe in Dublin in one year’s time, or that you will have X cafes with a specific profit in 3 years’ time. What’s your strategy to get there – i.e. how are you going to get there? Set yourself five or six smaller strategic objectives – they might be concerned with finance, sourcing of premises, hiring good staff, barista training, roasting training, sourcing of equipment, sourcing of beans – the key is that they, together, will deliver your top level goal and that they are measurable and time-bound.

This is also the time to agree on what you’re NOT going to do. There may well be fantastic ideas generated at the brainstorming phase that have to be parked – the team will have to prioritise and agree what is feasible within agreed resource constraints; what needs to be increased, reduced and eliminated in order to create. No organisation has infinite resources and in order to effectively pursue agreed strategic objectives, it is essential that resources do not get pulled six months down the line to work on someone’s latest hobby horse. Unless, of course, there is an agreed change in strategy.

Action plan

Referring back to the ideas generated during your brainstorming, define the actions necessary to deliver on each of your 5-6 Strategic Objectives.  You can download a template to help you organise the action items under each strategic objective from my website. What’s important is that you have the resources to pursue the actions and that you set yourself targets and milestones. It’s also advisable to decide on a small number of KPIs (Key Performance Indicators) that measure how well you’re doing on a month-by-month basis. The downloadable template can be used as a live document to track progress and KPIs.

It’s worth spending a bit of time at this stage considering the risks to your plan and working out some contingency plans.

Review

As many have said before me, “…the only sure thing is change,” so there’s nothing surer than the fact that your plan will require adapting at some stage. In fact, being flexible and being able to respond to changing circumstances is a strength, so periodic review of your plan is important, not just to ensure that you are on track but to ensure that what you’re pursuing and what you’re doing are still relevant.

New Frontiers -Business strategy process - Mary Carroll

Maintaining action

The biggest challenge many organisations face is implementation. All too often, they get sucked back into spending all their time on day-to-day operational issues. Dedicating the required resources, accountability and periodic review of the strategic action plan is absolutely critical – otherwise the strategy document will just gather dust on a shelf.

One of the big advantages of determining your mission, setting strategic objectives and detailing an action plan is that all actions should lead back to your mission. Having an action plan allows you to question whether what you’re doing right now is going to bring you closer to your mission. If not, why are you doing it?

About the author

Mary Carroll New Frontiers

Mary Carroll

Mary Carroll is a business strategist and coach with over 25 years’ experience in design engineering, management consulting and business development. She is also an Enterprise Ireland mentor… [Read Mary’s profile]

Other articles from the New Frontiers blog

The food business: when is a trend not a trend?

Four of the Mid West’s most promising New Frontiers startups

How to decide whether to outsource or keep everything in-house

A strong employer brand is essential for attracting top talent

New Frontiers Business expansion scaling your startup

Business expansion: scaling your startup

New Frontier s Business expansion scaling your startup

Any small company that has tried to expand will tell you that it’s a tricky business! Expansion – whether it’s increasing the number of staff, adding new product lines or more retail locations – brings an array of potential problems and headaches.

The risks of scaling your business are real, and they are as problematic for young startups as they are for large, established companies. But, in identifying the risks, you can work out solutions, learn from others who have faced the same challenges, and become more confident in forging on with your business expansion plans and strategies.

For my own startup, the Irish Biltong Company, our expansion plans are continually growing as new markets present themselves to us. I’ve found that the key is to identify the correct markets and grow in that direction. Here are my top tips for successfully growing your startup:

Maintain a healthy balance

Some business owners (and I was of this frame of mind for a while) think that business expansion is not going to affect their family life, their health, or their personal finances; and that they can be separated from the ongoing pressures of growing the business. Well, I have found that this is definitely not the case! One major change I have made in recent times is to safeguard myself against poor health by getting regular exercise, eating well and spending quality time (vs. quantity time) with family members. This is as important as anything else.

Prepare the whole team for growth

Business growth and expansion brings pressures to your daily systems, and your current structure and team may not have had the time or experience to get geared up for increased production or services due to a sudden growth in demand for your product. Our team had to increase production rapidly to cope with the influx of new sales over a short period of time. Luckily, we were prepared for this potential growth from the beginning and had production capacity schedules to call on and put into action. The team were motivated to deal with this quick growth and it was all hands on deck!

Keep an eye on cash flow

Cash flow is critical to successful expansion, as new timings of payables and receivables can cause financial strain. When expanding and increasing production, it is really important that the daily cash flow is strictly monitored to insure that your company can maintain its daily out. Cash is king – we’ve all heard this saying and it is more true today than ever before, especially for a small business expanding. A healthy profit may look nice on your financial statements, but if capital expenditures or extending credit terms are draining your cash, you won’t be able to stay in business for long.  Too often, small business owners fail to focus enough on cash flow generation. For small businesses, handling business accounting and taxes may be within the capabilities of the business owners, but professional help is usually a good idea. Getting assistance with managing cash and the bookkeeping can allow you to excel when others are calling it quits.

Think about customer service

When focusing on growth and rushing to meet a rise in demand, customer service can sometimes slip. As a company who prides itself on customer service levels it was crucial that we ensured the continuing level of service to our loyal customers whilst bringing new customers on board. Smartphones, social media, texting, email, Twitter and other communication channels are making it easy for businesses and individuals to get their messages out. Figuring out the right marketing channels is key for businesses to be successful in the future. These channels are equally valuable when it comes to customer service.

We quickly identified that our key customers were avid users of Twitter and Instagram. By running polls and asking for feedback from our followers, we were able to identify what new aspects of our existing products these customers wanted. Identifying what our customers want and doing a better job of giving it to them has made all the difference in our expansion and planning for the future.

Take employees with you

Employees can become uneasy about change. From the beginning of our business, we shared our vision of growth with our employees. We stirred in them the passion for growth and productivity that we needed to push forward and develop our products. We identified and made the need for change well-known throughout the business. We also facilitated ownership of this change by involving employees in the planning and implementation processes. We encouraged them to offer suggestions of solutions to problems that arose from our scaling activities. We gave genuine regard to the concerns of our employees, and we put procedures in place to monitor the effects of change.

There’s no one way to scale a business, but by ensuring you have the right vision and culture in place, backed by strong procedures, you’ll give yourself the best chance of success. Strong leadership is important, but so it taking your team and your customer base along with you. Our business is growing and, as a team, so are we!

About the author

Noreen DoyleIrish Biltong - Noreen Doyle - New Frontiers

Noreen Doyle is a New Frontiers past participant, and the co-founder and CEO of Irish Biltong Co. The company produces an award-winning, 100% Irish, gourmet beef snack that is a favourite of sportspeople and nutrition experts around the country… [Read Noreen’s profile]

Other articles from the New Frontiers blog

The food business: when is a trend not a trend?

Four of the Mid West’s most promising New Frontiers startups

How to decide whether to outsource or keep everything in-house

A strong employer brand is essential for attracting top talent

Using SaaS metrics and resources to bulletproof your startup’s growth

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Understanding the health of your SaaS (Software as a Service) business is crucial, but you need to be looking at the right metrics to accurately measure it. This article brings together some of the excellent online (re)sources that are available to the startup software entrepreneur looking to deepen their knowledge of this area. 

This is my quick reference guide to the battle-hardened experts who’ve earned their scars in the SaaS trenches, and who wanted to make it easier for SaaS entrepreneurs like you and me as we follow intrepidly in their footsteps.

Where did I find these awesome resources?

Most of the resources I have come across were from experts I follow on Twitter – either blog posts they wrote themselves, or others that they recommend.

The articles here are applicable, in my view, for both very early stage startups in the search for Product Market Fit (PMF) from €0 to €1M annual recurring revenue, as well as post-PMF startups looking to scale from €1M annual recurring revenue upwards.

Why should you bother reading any of what I’m suggesting?

Firstly, all credit for the content must go to the various trail-blazing authors behind the linked articles, and I’d strongly recommend you to dig deeper into the areas where you feel you and your business can learn the most.

Secondly, a disclaimer. I don’t claim to have a complete handle on all of this – far from it, in fact. That’s the very reason I’ve invested time (and some money) endeavouring to give myself that better understanding.

Moving outside our comfort zones

I’ve always believed that it’s critical to push yourself (and others) beyond the comfort zones of our learning experiences to date. How else otherwise do we grow? How do we learn from the mistakes of others without reading about and learning from them?

From a business perspective – and especially a startup business perspective – a theme that runs through all of the resources is this: if you want to put yourself into the less than 1% of startups who’ve a decent chance of making a commercial success of your idea, then you need to think differently. And the best starting point is to learn from others who’ve been there before, who can tell you the things that they dearly wished someone had told them the first time round. To learn from the best.

The resources in this guide are principally focussed on the engine of your business. But it’s how the entrepreneurs (some now venture capitalists) featured here did it that is interesting. They roll up their proverbial sleeves and ‘get their hands dirty’. There’s no corner of your business that they don’t look into. And they do this for good reason. They want to show you that you need to have a complete understanding of every facet of your business; and it’s your metrics that tell you how the business is doing.

Read these resources, learn to love them, and think of them as a trusted old friend who meets you for a coffee every couple of months and asks you: “But seriously, {insert name here}, are you sure you know what you’re doing with this whole startup lark?”

If you learn from these resources, you’ll reduce your risk of failure, and I reckon you’ll be able to look that friend in the eye and reply, with honesty and conviction, and say: “Yes, my old friend, I do.”

Some SaaS definitions

You’re probably already familiar with these definitions, but just in case you’re not, let’s agree some terms that will appear frequently in the resources:

Monthly Recurring Revenue (MRR)

This is the lifeblood of your business, and probably the bedrock metric against which all others are measured. There are four generally accepted definitions of Monthly Recurring Revenue:

  1. New MRR: new customers coming on board, and the revenue that they bring with them
  2. Expansion MRR: upgrades from existing customers, i.e. your existing customers buying more from you than they did the previous month. Remember, ‘expand’ means getting bigger
  3. Contraction MRR: downgrades from existing customers, i.e. your existing customers buying less from you than they did the previous month. Remember, ‘contract’ means getting smaller
  4. Cancelled MRR: cancellations by existing customers, i.e. the dreaded ‘churn’ where you lose a customer completely

Net expansion MRR: Coming back to that word I just used in the cancelled MRR definition. One variant on that would be the definition for ‘Net Churn’ or ‘Net Expansion MRR’. This is where Net Expansion MRR grows faster than gross CMRR (Cumulative Monthly Recurring Revenue from that prior period) i.e. more upgrades than downgrades per calendar month, taking into account any downgrades on a monthly basis. This is the sweet spot that as a startup you should be aiming for.

So we can say that “net expansion” is therefore the difference between Expansion MRR (upgrades from existing customers) and Contraction MRR (downgrades from existing customers).

Customer Acquisition Cost (CAC)

One other important definition (and there are of course many more) would be understanding your CAC, your Customer Acquisition Cost. What does it ‘cost’ the business to acquire a new customer? Broadly speaking, this is calculated by taking your sales & marketing costs and dividing that by the number of new customers in (measured quarterly).

Why is CAC so important in a SaaS business? Because your CAC (the cost to acquire your new customer) is pretty much incurred up front. But the return – the revenue that your newly acquired customer pays to you on a monthly (or otherwise) basis – comes in to your business in delayed (probably monthly) stages. So, it can actually take you (depending on your CAC and MRR) sometimes a year or more before your customer has paid you more than the cost incurred to your business in the effort to acquire them as a customer in the first place! That’s expensive.

Economics 101! That sounds like you’re going to have work out how you acquire those customers, when the revenue to acquire them comes in so late. So, without further ado, here’s a list of some of my favourite experts in the area of SaaS, who I wish I’d known about a long time ago.

SaaS resource list

“Pirate” Metrics

Blog name: 500 Hats

Blog focus: Startups, tech, VC funding

Author’s background: Dave McClure is a venture capitalist and founding partner at 500 Startups, a venture capital firm and startup incubator headquartered in Silicon Valley, founded by PayPal and Google alumni with over $250M in assets under management.

Why it’s worth reading: The whole blog has masses to offer, but I’m specifically recommending an article from 2007 called ‘Pirate Metrics’. Pirate Metrics is just a short-hand way to remember McClure’s acronym, AARRR, for what he considers to be the fundamentals to the customer lifecycle. (Go on, say it aloud: AARRR, pretending to be a pirate! Now you get it!)

McClure talks about what he terms the five steps to success in the customer lifecycle. Understanding where your business is at – how it’s measuring up – in each of those 5 AARRR steps, will help you determine your path of the journey towards success. AARRR stands for:

Acquisition: users coming to your site from various channels

Activation: users enjoying their first visit – a ‘happy’ user experience

Retention: users come back to your site, visiting it multiple times

Referral: users like your product enough to refer it on to others

Revenue: users conduct some monetization behaviour

Recommended reading: Startup Metrics for Pirates: AARRR!

Andreessen Horowitz

Blog name: A16z.com

Blog focus: Andreessen Horowitz backs bold entrepreneurs who move fast, think big, and are committed to building the next major franchises in technology. Founded by Marc Andreessen and Ben Horowitz, the firm provides entrepreneurs with access to expertise and insights in innovation, executive and technical talent, market intelligence, policy and regulatory affairs, business development, and marketing and brand-building.

Author’s background:  See above.

Why it’s worth reading: “The key difference between traditional software and software as a service: Growth hurts (but only at first).”

Recommended reading: Understanding SaaS: Why the Pundits Have It Wrong

David Skok – For Entrepreneurs

Blog name: For Entrepreneurs

Blog focus: This isn’t light reading. But it contains the keys to the kingdom in understanding this area.

Author’s background:  Slok started his first company a few months after leaving university at the age of 21, and over the next 25 years founded a total of four companies (Skok Systems, Corporate Software Europe, Watermark Software, and SilverStream Software) and did one turnaround (Xionics). Three of the companies went public, one was acquired, and one initially succeeded, but then failed when he moved the company to the US. After 25 years as an entrepreneur, he became a venture capital partner at Matrix Partners, the firm that had backed his last two companies.

Why it’s worth reading: “This article is a comprehensive and detailed look at the key metrics that are needed to understand and optimize a SaaS business.”

Recommended reading: SaaS Metrics 2.0 – A Guide to Measuring and Improving What Matters

Tomasz Tunguz – Venture capitalist blog

Blog name: TomTonguz.com

Blog focus: See author’s background below.

Author’s background: A partner at Redpoint (VC firm) who writes daily, data-driven blog posts about key questions facing startups, including how to fund raise, startup benchmarks, management best practices and team building. He co-authored the book, Winning with Data.

Why it’s worth reading: Great data-centric unpacking of questions that should be being asked by all startups.

Recommended reading: The Importance of Payback Period for SaaS Startups

Andrew Chen

Blog name: @andrewchen

Blog focus: “long-form essays on what’s going on here in Silicon Valley.”

Author’s background: Andrew Chen works at Uber, where he heads up driver acquisition programmes for the Growth team. He writes about mobile, metrics, and growth. He is an advisor/investor for tech startups including AngelList, Barkbox, Dropbox, Grovo, Kiva, Product Hunt, Qualaroo, Wanelo, and ZenPayroll. Previously, he was an Entrepreneur-in-Residence at Mohr Davidow Ventures, a Silicon Valley-based firm with $2B under management. Prior to MDV, Andrew was director of product marketing at Audience Science, where he started up the ad network business that today reaches over 380 million uniques. He holds a B.S. in Applied Mathematics from the University of Washington.

Why it’s worth reading: Don’t trust me, trust Eric Ries, author of The Lean Startup: “One of the best entrepreneurship blogs of all time.”

Recommended reading: Minimum Desirable Product

Price Intelligently – Price Sensitivity Analysis and your SaaS Metrics

Blog name: Price Intelligently

Blog focus: Helping SaaS leaders align the right product to the right customer for the right price in order to boost revenue and learn more about their customer.

Author’s background: See below.

Why it’s worth reading: The authors drill into you that pricing is a process, and probably the single most valuable and overlooked lever in your SaaS business – many SaaS companies will happily spend thousands of hours building and refining their product, but may only dedicate 6 hours to pricing it – and yet wonder why their business with an awesome product went swirling down the drain.

Recommended reading: Buyer Personas – understanding your customers’ willingness to pay

Jason Lemkin – SaaStr Blog – getting from $0M to $100M faster

Blog name: SaaStr

Blog focus: SaaStr began in 2012 as a simple attempt via a WordPress blog, together with a few answers on Quora, to help share back Jason M. Lemkin’s learnings of going from $0 to $100M ARR with the next generation of great SaaS and B2B entrepreneurs. It has since gone on to become the largest community of SaaS founders and entrepreneurs, with over 3 million views per month and 20 million+ views on Quora, and events hosted throughout the year.

Author’s background: Two time tech entrepreneur (with two successful exits to his name), Lemkin moved into the world of venture capital. Previously CEP of EchoSign, online digital signature tech company acquired by Adobe. What differentiated him was his ability to spot the gap in the resources available to someone interested in the entire journey of a start-up, from idea through to acquisition.

Why it’s worth reading: What distinguishes his blog is his unflinching, searing honesty, his consistent supply of real life examples for the the theories he espouses, and his unrelenting encouragement and infusion of belief in the underlying revolutionary aspect of the SaaS model business model. If you haven’t yet started learning from him, he’d be one of the first I’d encourage you to look at. He’s also co-authored a book called From Impossible to Inevitable with Aaron Ross, who lead the outbound sales and prospecting team at Salesforce which added an extra $100M of revenue. Lemkin’s the founder of arguably the world’s largest pure SaaS conference.

This is the blog of the entrepreneur (exits @ $12M and then $50M) turned VC exclusively focusing on Saas. His writing is compelling and highly educational.

Recommended reading: How to Know When You’ve Hit Initial Traction in SaaS. The Moment When You’ve Got A Real Company. I also highly recommend that you sign up to their weekly articles. For example in his article, The Top 10 Mistakes First Time SaaS Founders Make, point no. 7 is bang on for scaling enterprise level software sales.

Mistake #7: Not going up-market fast enough. Dude. If you have one $100k customer, you can get 2, and then 10. And if you have one $100k customer, you really think the next one can’t pay $150k? Of course they can. Don’t be scared. Don’t be timid. Push up market as fast and as hard as you can. Make the ask. Do it.

Chaotic Flow by Joel York – 10-part guide on SaaS metrics

Blog name: SaaS Blog by Joel York of Chaotic Flow

Blog focus: SaaS, coming from a mathematical background.

Author’s background: CalTech and Cornell scientist and technologist who’s been making and marketing and writing about B2B software (desktop, enterprise, SaaS) for the last 20 years.

Why it’s worth reading: Joel York’s blog contains razor-sharp articulations of all SaaS metrics, and he’s been a pioneer in assisting other entrepreneurs to better understand the area. His illustrations of the maths underlying some of the concepts can help even people who struggle, like me, with basic algebra! He’s written an incredibly useful guide to SaaS metrics.

Recommended reading: In his series on SaaS Metrics and their inter-relating impact on each other, he’s written a great 10 part series of articles which are all in my view well worth reading. It discusses:

  1. Churn kills SaaS growth
  2. New customer acquisition growth must outpace churn
  3. Viral growth trumps SaaS churn
  4. Company time to profit follows customer break-even
  5. Best cast time to profit is simple break-even
  6. Growth creates pressure to reduce total cost of service
  7. Churn creates pressure to reduce total cost of service
  8. Upselling and upgrading accelerates SaaS profitability
  9. Joel’s magic SaaS number
  10. SaaS customer lifetime value drives SaaS company value

Inside Intercom – the blog for Intercom

Blog name: Inside Intercom

Blog focus: Design, customer experience, startups and the business of software.

Author’s background: Irish entrepreneurs build global customer software platform with a suite of products for live chat, marketing, feedback and support – and then write about the experience as they go.

Why it’s worth reading: Beautifully put together posts that are actionable and written from the entrepreneur’s perspective (which is rarer than you’d think).

Recommended reading: SaaS Metrics for Fundraising

See also:

Paul Graham

Blog name: Paul Graham

Blog focus: All matters startup and technology rated.

Author’s background: Paul Graham is a programmer, writer, and investor. In 1995, he and Robert Morris started Viaweb, the first Software as a Service company. Viaweb was acquired by Yahoo in 1998 and became Yahoo Store. In 2001, he started publishing essays on paulgraham.com, which in 2015 got 34 million page views. In 2005, he and Jessica Livingston, Robert Morris, and Trevor Blackwell started Y Combinator, the first of a new type of startup incubator. Since 2005, Y Combinator has funded over 1,000 startups, including Dropbox, Airbnb, Stripe, and Reddit.

Why it’s worth reading: Absolute cutting-edge thinking. He’s one of the most influential thought-leaders in technology today.

Recommended reading: Startup=Growth

See also: his book, Hackers & Painters: Big Ideas from the Computer Age

About the author


David Millerdavid miller new frontiers

David is a New Frontiers alumnus and the CEO and co-founder of Complyfile. A successful litigation solicitor in a previous life, David is now on an entrepreneurial journey to develop a world-class online volunteer recruitment compliance software tool… [Read David’s profile]

Other articles from the New Frontiers blog

The food business: when is a trend not a trend?

Four of the Mid West’s most promising New Frontiers startups

How to decide whether to outsource or keep everything in-house

A strong employer brand is essential for attracting top talent

Building your brand is about sharing your vision

Vision is a picture of the future; it’s how you imagine your startup, where it will be in the years to come and the values it will hold. Vision provides direction and acts as a constant reminder of what you have set out to achieve. If you can learn to share that vision, you’ll be able to grow support for your budding enterprise.

Starting out, we wanted to convey of our vision for how people might interact differently with mobile devices. However, during this early stage of shaping the idea, the actual process can make this difficult, especially when you are being advised to protect your intellectual property (IP) and open up at the same time. Once we had lodged a patent application for our product, Scriba, we were finally free to show people what we were doing and therefore get proper feedback from them. This freedom, and the input of others, really allowed us to start thinking about the long-term possibilities of what we were doing.

The bigger picture

Companies like Google can be incredibly open about their vision and ideas, because what they are doing is so huge and so hard for others to replicate that they don’t really run any danger of being copied. But it isn’t the same for small companies, who have to walk a tightrope between getting validation and feedback and having their concepts stolen!

How you describe yourself and how you position yourself changes as much depending on who you are talking to as the context in which you’re speaking. Being on the New Frontiers programme, I benefitted from regular interactions with the other participants, all of whom were free to discuss their own experiences and challenges. This liberation and interaction with others who were in the same boat allowed me to talk openly about both the detail and the big picture. It was great to be challenged on my vision from day one, and of course within this group I didn’t have to be secretive about my idea!

I come from an architecture background, and we work in a different way on projects. With implicit deadlines and demands, we spend much less time working with an amorphous idea. Parameters are fixed earlier and the development is really only refined over time until it finally becomes a building. So, with this startup, I was conscious of trying to keep the idea loose and open for as long as we could, which allowed other people to give us their input.

Turning the vision into a tangible product

Hardware development involves many complex and time-dependent processes, including design, testing, technologies, manufacturing and distribution that develop at their own pace and can sometimes go out of sync for all kinds of reasons.

At any given moment, one element of the project might be more advanced than another – the hardware, the electronics, the business plan (market, price point, positioning, etc.). It became a time versus effort balancing act. Right now, we’re really happy with the electronics, we’re trying different materials for the hardware and we’re confident about our value proposition… so the current balancing act is looking at other applications that the product could potentially have and quantifying the user benefits that they might provide.

When I first came up with the idea for the Scriba, I wanted a stylus that would be really comfortable to use and give me a more natural interaction with my iPad. I had made a simple design and turned it into a 3D model which I carried around with me… but I really had no idea what direction that this was going to take.

To create a working prototype, I taught myself some basic electronics. I started with a Galileo Board that I had picked up at Hackathon; I managed to get it working, but electronics was a black art to me and I struggled on a daily basis. Staged progress through ten prototypes suddenly made a big leap forward when I switched to a Bluetooth development board. Suddenly I had something in my hands that would actually work!

Maintaining your vision is therefore key to always being able to see the bigger picture and focus on your end goal, especially when you have to change direction because the route you had chosen is no longer open to you.

Build a vision, build a team

Vision is about dovetailing your business idea with your own passion, goals and expertise. You build a vision. My approach to this has been greatly influenced by my experience as an architect – where you have to have an overview of all your projects whilst also keeping track of the little details. When your vision is truly a mix of passion and goals, it becomes easier to maintain and follow through with daily milestones.

Your vision also needs to allow for some flexibility so it can accommodate, and be enhanced by, other people’s ideas. Sharing that vision with other people is key to establishing the business in the first place. I shared and shaped my vision with the other participants and mentors on the New Frontiers programme. Once the patent for Scriba was lodged, we contacted around 5,000 people directly through Twitter – people we had researched as being our target market – and asked them for advice on what really mattered to them.

Around 600 people came back to us with incredibly detailed responses: what they used styluses for, where they used them, how many they owned, where they bought them and what would be valuable features to have. These responses meant that we suddenly had real data we could use. As the product developed we did product testing with small groups of creatives, observed by an ergonomics engineer. We gave people a prototype of the product, but no instructions, and watched how they picked it up, investigated it and used it.

Building a wider community

Sharing your vision is as much about validating your ideas as it is about finding support to bring those ideas to commercial reality. You need to be open to learning through networking, asking questions, sounding people out and, above all, listening. Keeping an open mind and being positive, enthusiastic and helpful can open doors and bring opportunities you had never dreamed of.

I have gained a lot from this process and benefited from:

  • learning how to communicate my vision as clearly and as simply as possible
  • learning how to tell a story well (but remember, the more truth it contains, the easier it is to tell!)

It is very important to talk to others about your vision: share enough information about your idea to arouse curiosity, but not so much as to risk it being stolen. Also, people will be as interested in you as in your idea, so don’t forget to share your own personal journey as well.

Regularly assess what you are learning from the process and how, or if, it is helping you move forward. Sometimes this will mean a pivot for your startup, although for us it was more a case of many, minute pivots – such as changes in positioning or changes in the design – which occurred naturally and continually along the way.

Sharing our vision has been a key factor in building an in-house team and in attracting wide network of advocates whose input has been instrumental in moving our business forward.

[If you’d like to see the video above with sound, click here.]

About the author

david craig new frontiersDavid Craig

David is founder and CDO of Dublin Design Studio and a New Frontiers alumnus. An architect by profession, David decided last year to explore his earlier passion for product design. His startup has created Scriba, a new concept in tablet styluses… [Read David’s profile]

Other articles from the New Frontiers blog

The food business: when is a trend not a trend?

Four of the Mid West’s most promising New Frontiers startups

How to decide whether to outsource or keep everything in-house

A strong employer brand is essential for attracting top talent

John Teeling on entrepreneurship and the future of business

john teeling

We thought we would speak to one of Ireland’s leading businessmen to see what tips and insights he has for Irish startup entrepreneurs in 2015. Teeling is known for his straightforward approach and boundless energy. Despite a punishing schedule, he found the time to speak to me from his offices in Clontarf, giving me a hint of the openness and positivity he so clearly brings to everything he does.

For those of you who have been living under a rock for the past few decades, John Teeling is the intellectual, globe-trotting founder of Cooley Whiskey and the man who has had more companies listed on the London Stock Exchange than anyone else from Ireland. With current interests predominantly in energy and mining, he’s been a force of nature in the business world since he left academia at the age of 41, after a lengthy teaching stint at UCD.

The serial entrepreneur

Although many people describe him as one, Teeling doesn’t really approve of the term “serial entrepreneur”. He is, he explains to me, a “portfolio entrepreneur”.

The first time you do something it’s incredibly difficult, but once it’s done you realise just how easy it was. And if you’re entrepreneurial already, you tend to see more than one opportunity.

And, having spent a lifetime as an entrepreneur, Telling says he has more opportunities now than ever.

Anatomy of an entrepreneur

Everyone has their own theory as to what “makes” an entrepreneur (there are 100 Million hits for that question on Google, if you’re ever at a lose end). For John Teeling, it’s a simple mix of four things:

Having an idea

An entrepreneur has absolute faith in their idea, and isn’t swayed by the opinions of banks, accountants or other interested parties. They have a visceral belief in their vision. And the real superstar entrepreneurs – the Steve Jobs of this world – see quantum leaps ahead of everyone else. Self-belief is the key.

The ability to gather resources

The ability to recognise and pull together resources is the key to succeeding in business. That’s not just about funding, it’s also about people and technology. You don’t always need to have the money in place to try your idea – you can lease or rent technology, and if there are gaps in your knowledge you can hire someone with the skills you lack.

You won’t find Teeling on LinkedIn or Facebook, but he’s no technophobe and embraces technology where it can bring benefits to his businesses. The Dundalk distilleries, for example, are 98% computer controlled and he’s happy to explore any solution that can improve efficiency and processes.

The ability to handle uncertainty

Uncertainty is “not knowing what you don’t know”. Whereas risk is measurable, there are also things that can happen which you could never have anticipated. Be prepared and expect something to go wrong!

Energy and determination

Follow it through to the end and don’t ever give up.

Building the team

Teeling is responsible for the creation of a staggering number of companies and sits on the board of many. He describes his job of Chairman as one of “acting in times of crisis”. Once he has set a company up, and laid out its roadmap, he likes to take a very hands-off approach to managing the day to day.

But he’s only able to do this if the right team is in place.

I trust the people I hire unless they give me a reason not to. The right people are out there, you just have to go and find them. But expect to make mistakes. And if you’ve made a mistake, fix it as soon as you can.

Teeling is a tough recruiter. As a former academic, he likes to see good academic achievement and technical ability. He believes that entrepreneurs are born, not made, and that education brings that out in them – that they “self-select” by getting the technical qualifications they need.

A lot of entrepreneurs have Type A personalities and are very hard to work with. So finding someone who can work with you is an issue. Choosing the right person is really about having an educated gut instinct.

The future

Teeling sees a few key areas with huge potential for growth in Ireland.

Food and drink

Identifying ways to add value is a big opportunity in the food and drink sector. Whiskey, for example, is sold for nine times the value of its raw ingredient, grain. Teeling sees a wealth of opportunities in the dairy sector, such as whey-based products (protein drinks, sodium lactate and even plastics). Another under-exploited resource is in the meat industry. Because of low domestic demand for offal, most of it is currently disposed of, but Teeling believes that in the future, nutraceuticals and pharmaceuticals will evolve in this area.

Energy

Tidal energy will be a big opportunity for Ireland, as will energy storage.

Tourism

Special Interest Tourism offers huge growth potential in Ireland. Organised, themed trips are becoming increasingly popular with affluent tourists, who’ll spend a few days totally immersing themselves in a particular area. The example he gave me was of a special interest tour in Mexico, accommodating groups of up to 10 people, who have paid an eye-watering amount of money to spend three days at a tequila distillery. Here in Ireland, such tours could focus on our outstanding food production sectors, music and languages.

John Teeling’s advice to young entrepreneurs

Never look back. If you make mistakes, just move on. You can’t change the past.

Creating a startup is an adventure. Enjoy it, enjoy even the bad times. You’ll look back on them with an enormous sense of achievement. Of course you’ll make mistakes, but if you really feel you have the urge and don’t go for it, you will regret it.

 

About the author


scarlet-merrill
Scarlet Merrill

Scarlet Merrill is Editor of the New Frontiers website and founder of her own startup, Engage. She is an expert in designing and executing content strategies and passionate about helping businesses to develop a quality online presence… [Read Scarlet’s profile]

Other articles from the New Frontiers blog

The food business: when is a trend not a trend?

Four of the Mid West’s most promising New Frontiers startups

How to decide whether to outsource or keep everything in-house

A strong employer brand is essential for attracting top talent

Market Research: a key component of business strategy

market-research-centre

The Enterprise Ireland Market Research Centre is located at our offices at East Point Business Park, Dublin. Client companies can access the most up-to-date information on a vast range of markets, sectors, companies and countries, either in Dublin or at our regional locations.

What is market research?

Neil Armstrong defined research as a “means to investigate something you do not know or understand.” This definition can also be applied to the more specific area of market research.

There are two types of market research: primary and secondary. Primary market research involves collecting data from its source (e.g. by surveying customers). This type of research is usually used by the company itself. The other type of research is called secondary research (or “desk research”) and involves the gathering and summarising of primary research.

Enterprise Ireland subscribes to over 30 premium online sources of commercial information, prepared by sector specialists from some of the leading analyst houses, in order to assist clients with secondary research work. These sector reports and directory sources cover market, company and country information in global industries ranging from medtech and pharmaceuticals to pet food and everything inbetween.

Who can use the Market Research Centre (MRC)?

The MRC’s service is available to all established clients of Enterprise Ireland, as well as Phase Two participants of the New Frontiers Programme.

Anne Walsh is a New Frontiers Programme participant. Her company, Allergy Lifestyle, provides a range of products for the management of allergies & anaphylaxis. After using the MRC, she commented,

“We found that Enterprise Ireland Market Research Centre reports are an invaluable resource not to be overlooked in helping us research our market and profile our competitors. Staff were extremely helpful in assisting us access the many industry standard reports available.”

What’s in it for me?

The American anthropologist and author, Zora Neale Hurston, said that “Research is formalized curiosity. It is poking and prying with a purpose.” There are many benefits to taking the time to conduct market research. For those of us working in the MRC, our job is to assist clients in their research for market, company and country information. We do this by talking clients through their request, so that both parties can clarify what exactly needs to be researched and what direction will be taken. As I have mentioned earlier, we specialise in three main areas of market research:

  1. Market information deals with the sector size and share as well as its growth rates. We also have resources such as www.marketline.com which gives top-line information about industry structure and overview. Drivers and restraints, SWOT analysis and information on trends and forecasts are also a very important part of researching specific markets.
  2. Company information involves researching your competitors, potential customers and the players involved in the route to market (e.g. suppliers, distributors, wholesalers, etc.).
  3. Country information is concerned with regulations and legislations within a particular country, how to do business and PESTLE insights.

By conducting research in these three key areas, you will gain great insight into the markets you wish to enter and develop your existing knowledge about the industry you are situated in.

It has been proven time and again that companies that undertake effective market research have a huge competitive advantage over their competitors and often become leaders in their sector. Needless to say, good market research will also help your business to save money, time and headaches in the long run.

Katja Bressette, a leading qualitative market researcher, said that “to understand how consumers really think and feel, it is vital to go beyond words.”

Let’s get started!

If you’re interested in using our Market Research services, you can call us on 01 727 2324 or email us at market.research@enterprise-ireland.com. There is also a full list of our resources on the Enterprise Ireland website (click on “All Databases” in the Global Research Databases section).

Once you have contacted us, a member of the Market Research Centre team will assist you in deciding what to research and how to go about it. We will look into your query and gather relevant information, arrange an appointment for you to visit the Market Research Centre and when you visit we will show you how to use the research the available information in our resources and databases.

Carl Sagan, the famous astrophysicist and astronomer, rather poetically said that “somewhere, something incredible is waiting to be known.” I believe that to be true, whether you are researching the stars or simply reaching for them!

About the author

Dearbhla-oDwyer-New-FrontiersDearbhla O’Dwyer

Dearbhla is a student in Law & Business at Maynooth University. She is currently on an 11 month internship as an Information Executive in Enterprise Ireland’s Market Research Centre in Dublin… [Read Dearbhla’s profile]

Tendering to win: the importance of competitive intelligence

competitive-intelligence-new-frontiers

“To know your Enemy, you must become your Enemy” said Sun Tzu, in the Art of War. Sometimes, competing for business can seem like a battle – with the odds stacked against you and the chances of success slim at best. However, all is not lost. Competitive Intelligence (CI) is a key weapon that will level the battle field and allow you to compete with the advantage of knowledge on your side.

Competitive Intelligence is the ethical gathering and analysis of competitor, customer and market information from open sources. This analysis is used by organisations to make better strategic decisions. It is the difference between competing and winning.

Why should I care about CI?

Your organisational survival may well depend on the knowledge that you can acquire from and about your prospects and market competitors. Public sector procurement is becoming increasingly transparent and the victors are those that can demonstrate that they understand their clients’ needs and have positioned themselves favourably in comparison to other suppliers. It is not overstating the case to say that embedding competitive intelligence as a core management process is increasingly essential towards survival and growth in the 21st century.

Embedding CI into my organisation

Make the acquisition and safe-guarding of CI part of your normal business operations. Create profiles of your target customers, as well as your main competitors. Collect data from the companies’ own websites and their published case studies; add to this aggregate from news and social media websites and also flesh out from your real world connections. Finally, use your organisation’s own human intelligence to identify the areas that you have competitive advantage in and work on your weaknesses to improve your overall ability to compete.

Best practice for managing CI

Qualify your Tenders:

  1. Tendering is expensive – compete only where it makes good sense and learn as much from losing as from winning
  2. Make intelligence gathering systemic – Know your customer, your competitor, your partner… and yourself
  3. Procurement history – Identify buying habits, incumbent suppliers, decision makers, previous purchases and evaluation criteria
  4. Maintain an information repository – Protect your corporate knowledge and facilitate fact-based decisions

Remember that CI is more concerned with understanding the big picture and having the right perception of the marketplace that trying to precisely quantify or qualify competitive threats and business opportunities.

How do I get started?

A good first step towards increasing revenues is to identify your competitive landscape. Identify the clients that you want to work with,  the competitors you want to take business from and the type of business that you want to be doing. Next, consider how well-positioned you are to be successful – do your target clients know and like you? Are your competitors better than you? Do you have the capability and capacity to service the needs of those clients? The answers to those questions will evolve over time as you become more attuned to the dynamics of the competitive landscape.

While you’re working on that, it’s also a good idea to try competing for some business; the public procurement portal etenders.gov.ie is a good place to start. By writing proposals, your value proposition will be critically evaluated against the value propositions of your competitors, by actual buyers. That’s incredibly valuable information that tells you exactly where you need to improve, shows you what the expectations are in your industry and where you rate against the competition. After that it’s up to you to create a strategy to address that feedback and start winning more business.

Each time you participate in the tendering process, you learn a little more about what it takes to win. As Sun Tzu noted, “Opportunities multiply as they are seized.”

About the author

Tony-Corrigan-New-FrontiersTony Corrigan

Tony is the Director of TenderScout and a past participant on New Frontiers. His disruptive SaaS company has won the Eircom Spider Business Choice award and was recently shortlisted for the ESB Spark of Genius award at the Web Summit, as well as being an Enterprise Ireland client and in receipt of Competitive Start Funds (CSF)… [Read Tony’s profile]

How to craft your Value Proposition – a tool and a formula

value-proposition-tool-formula

A Unique Value Proposition (UVP) is extremely important for every startup business. It is the answer to the question: What is it that makes your product or service different, unique and most importantly will persuade people to buy from you? The problem for early-stage promoters is defining the essence of their solution and communicating it concisely. This article will outline a process for crafting your Value Proposition and outline some examples from participants on New Frontiers programmes.

UVP is a critical component of any marketing strategy

A strong value proposition is the first step in deciding how a business is going to market its solution. It goes to the heart of what the business does (or does not do) and why that matters to customers. One of the primary objectives of marketing is to generate awareness of and interest in your solution in a target market that is being constantly bombarded with marketing messages.

Ash Maurya, author of Running Lean holds that the definition of UVP needs to be redefined. He challenges startups to ‘distil the essence of your product in a few words that can fit in the headline of your landing page’.

First-time visitors spend eight seconds on average on a landing page. Your UVP is their first interaction with your product. Craft a good UVP and they might stay and view the rest of your site. Otherwise they’ll simply leave.

Ash Maurya, Running Lean

Remember, you’re not trying to tell the entire story in one line, but get across that you have a story worth considering. The reaction to your UVP should be ‘How does it do that?’ or ‘Tell me more’.

value-proposition-canvasValue Proposition Canvas

I use this value Proposition canvas from the Business Model Foundry as an exercise with Phase 2 participants in Tralee and Dundalk IT and it has received great feedback as it provides a structure for considering all elements. My advice is to start with the Customer Segment and the jobs that customers want done and then work through the rest. Then write your one or two line UVP.

There is a detailed explanation of all six elements in the Canvas in their pdf download.

A UVP Formula

The classic formula for crafting your UVP is:

Instant Clarity Headline = End Result Customer Wants (+ Special Period of Time + Address the Objections)

And the classic example of this formula in action is:

Hot fresh pizza delivered to your door in 30 minutes or it’s free (Dominos)

The entire formula won’t be relevant or applicable in every situation, but the headline should definitely reference the target customer and their wants. It is also important to consider if the objections of the target buyer can be addressed.

Crafting your UVP

When creating your UVP, the key is to focus on the benefits your customers derive from your product. These ‘finished story benefits’ will ensure that your UVP gets inside the heads of your customers. For example, consider how to formulate the proposition of a resume-building service:

  • Feature: professionally designed templates
  • Benefit: eye-catching CV
  • Finished story benefit: landing your dream job

I think that the finished story benefit will definitely grab attention. It is then up to your product solution to deliver, which is a sure way to delight your customer.

Test and refine your UVP

The first step in testing your proposition is to discuss it with a trusted business advisor or mentor. It is also important to verify your customer assumptions, so you’ll need to engage with as many customers as you can and find out if their priorities, pains and gains are as you have described them. Once you have done this, you’ll be able to tweak or even change your proposition based on these insights. Here’s a great example:

I don’t play golf, but I love Golf Voyager’s value proposition. The key problem they are trying to solve is the hassle involved in organised group golf trips. A New Frontiers business in Limerick in 2013, they have a brilliant hook to their model in that they pay part of your next year’s golf membership if you book trips and hotel stays through their website:

“Book all your hotel stays and golf holidays through Golf Voyager and save on your membership fees next year.”

My Conclusion and Call to Action

One of my favourite quotes from a business book that I highly recommend, The Jelly Effect, is:

AFTERs – People don’t care what you do. They only care about what they are left with after you have done it.

Andy Bounds, The Jelly Effect

This might seem a bit harsh, but it’s definitely true!  My final example is from Olive O’Connor, a New Frontiers participant in 2013, who has developed a Filofax-type medical organiser for people and carers managing chronic illnesses. The MediStori gives people who don’t wish to use technology an easy-to-use, paper-based solution. On one level, this allows people to record their medical history and keep a daily medical record which can be easily shared, and on another level it gives them back a sense of control over their own lives. The result is a prototype that has garnered endorsements from charities, doctors, pharmacists and patient groups. Olive has used her UVP to produce a video to promote MediStori (see below).

My challenge to you is to craft a value proposition that works for your business. I hope that you find the UVP formula and the value proposition canvas useful as you set about this task!

About the author

Donncha Hughes profileDonncha Hughes

Donncha Hughes is a former incubation centre manager and has worked with startups for almost ten years. A big advocate of Lean Startup, his areas of expertise include: marketing, sales, business models, supports for business, business plans and financial projections. An EI mentor and member of the CSF Evaluation Panel, Donncha specialises in working with early stage startups… [Read Donncha’s profile]

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