Presentation on theme: "Starting A Technology Business Dr. Tim Willis, CEO Edinburgh."— Presentation transcript:
Starting A Technology Business Dr. Tim Willis, CEO Edinburgh
Overview 1.My Product, Me, My Company 2.Could You Be An Entrepreneur? 3.Your Business – what, why, how? 4.What not to do 5.Questions
My Product: Flexible Text Expansion
Converts any reasonable abbreviation into full wd would xprc experience tfon telephone lrng learning 2mrw tomorrow 428 fortunate abv8n abbreviation
Unique Simply, awesome! Love it a lot. Cool keyboard, way faster than Swype
Previous History BA Linguistics & Phonetics (Leeds) MSc Cognitive Science & Natural Language (Edin) PhD Informatics (Edin) A Flexible Expansion Algorithm for User-chosen Abbreviations 5 years Uni Research posts Schools Liaison (Leeds) Info service for a band Internet startup (late 90s)
Where next? 1)Not a suit-n-tie person 2)RA posts – no permanence 3)Disability communication – valid need but little funding 4)Lecturer – too late? Been too unfocused? 5)If your ideal job doesnt exist, can you create it?
My Opportunity Autumn 2006: Commercialisation Funding from Uni £6k – 3 months - build proof-of-concept. Then more raised. …Somewhere evolved into a business. £72k total raised (loan / grant). …but I still own 96%
Progress so far... Android Market / Google Play 14 monthsAndroid Market / Google Play 14 months c. 15k downloads, almost no marketing – will explain whyc. 15k downloads, almost no marketing – will explain why Free + Pro. Please download & rate!Free + Pro. Please download & rate! Great rating – 4.5 / 5 stars, sometimes 4.6Great rating – 4.5 / 5 stars, sometimes 4.6 How many Android phones here?How many Android phones here? Lots of competition!Lots of competition!
Your Business 1.You 2.Product 3.Markets 4.Where to start 5.Money 6.Development 7.Intellectual Property (Patents etc.) 8.Team 9.Marketing 10.Competition 11.Reviews 12.Legal & Accounting
Could you be an entrepreneur? Are there direct applications for my research or knowledge that havent been done, or could be done better? Are there other applications? …& will anybody buy them? Are there other applications? …& will anybody buy them?
Why would I want to do that? Good & bad: Your own boss (until investors) – take a break when you want BUT never off-dutyYour own boss (until investors) – take a break when you want BUT never off-duty Unknown outcome – HIGH RISKUnknown outcome – HIGH RISK Novelty most daysNovelty most days Running on vapour!Running on vapour! Trying to persuade others its worthwhileTrying to persuade others its worthwhile Spinning many platesSpinning many plates Probably working from homeProbably working from home Dont need to know how to do something, just how to find someone who does.Dont need to know how to do something, just how to find someone who does. (& pay them) (& pay them)
Whats the big idea?
Product + Market = Opportunity Tech: Fiercely competitive. Me too productsTech: Fiercely competitive. Me too products HardwareHardware SoftwareSoftware …a bit of both…a bit of both 2016: 310bn apps downloaded (Gartner)2016: 310bn apps downloaded (Gartner) 93% free93% free $46bn revenues$46bn revenues In-app purchasesIn-app purchases
Markets Segments – can you sell the same thing (with slight modification) to lots of different groups?Segments – can you sell the same thing (with slight modification) to lots of different groups? Low volumeHigh volume Low priceX High price
Nobody will tell you your baby is ugly
Seek impartial views 90% of new businesses fail in year 1*90% of new businesses fail in year 1* Your friends will all tell you its greatYour friends will all tell you its great Get independent opinions asapGet independent opinions asap – WILL ANYONE BUY THIS? WILL ENOUGH PEOPLE? – WILL ANYONE BUY THIS? WILL ENOUGH PEOPLE? House o sad photosHouse o sad photos Dont delude yourselfDont delude yourself If you have to, walk awayIf you have to, walk away Try and have an escape route…Try and have an escape route… …you will be more employable!*…you will be more employable!* * Unreliable source
The best doesnt always win... vs.
Now you dont need to throw out your cassette collection!
Where to start? StudentsStudents –Supervisor / Director of Study –Launch.Ed –Commercialisation dept –Scottish Institute for Enterprise (SIE) –Starter for 6 (formerly run by NESTA) YoungYoung –Princes Trust EveryoneEveryone Networking eventsNetworking events Scottish Enterprise (SE)Scottish Enterprise (SE) Business GatewayBusiness Gateway
Business Plan Out of date before you hit Save. Never-ending. Roadmap to success – 3-5 years predictions for companys activities and sales Covering all the sections in this talk, Executive Summary at the front.
Business Model How are you going to make money? In Magic Rainbow Land PRODUCT + EFFORT + MONEY + TIME + LUCK = SUCCESS Sell it? Licence it? Give it away and sell round it?
Setting up Sole Trader / Ltd company / partnerships etc. Need to inform HMRC you are trading – even if youre just engaging in R&D for now. You should be able to learn all you need to begin with for free but will need a professional for Ltd etc.
More on Funding Investment? No: Organic growth: may run out of money; may never gain enough traction BUT own 100% Yes: High-Growth-High-Risk? A smaller share of a bigger amount – the pie In-between? Angels, Venture Capitalists (VCs), Dragons… VAT registration? If spending a lot pre-trading, can reclaim it BUT: you have to charge it on everything you sell and hand over the money - quarterly VAT returns - time & accountancy fees - time & accountancy fees
The Money Pit Trying to reduce burn rate vs. being too slowTrying to reduce burn rate vs. being too slow Rent – home + business FoodProfessionalsProgrammersDesignersAccountancyLegal Office – computers, phones, power bills
Product Development GET IT OUT THERE MINIMAL VIABLE PRODUCT No bells. No whistles. Start selling. The most basic functionality that wont look total crap. Fix later – respond to what the users / buyers want.
Listen to your customers... …but dont try and please everybody…but dont try and please everybody
Catch-22 TOO EARLY Too many bugs Not enough features = Bad reviews One-shot with many reviewers and investors Yeah I tried that, it was crap TOO LATE I already have an app for that Didnt [insert competitor] invent that? Run out of money Never leave the runway Too many other apps to get noticed
Intellectual Property (IP) Any knowledge, ways of doing things, computer code, internal reports etc. owned by the companyAny knowledge, ways of doing things, computer code, internal reports etc. owned by the company Financial value - potentiallyFinancial value - potentially c.f. Publish or Perishc.f. Publish or Perish – BUSINESS is EXACT OPPOSITE OF ACADEMIA Public domain = can never patentPublic domain = can never patent - includes journal & conference papers, videos, web pages & chats in the pub. Who owns your student research? Embargo? NDAsWho owns your student research? Embargo? NDAs Patents get very expensive – ongoing costsPatents get very expensive – ongoing costs Trademarks etc…Trademarks etc…
Team Investors prefer: A Team + B product to B Team + A product
Rewarding the Team You have no moneyYou have no money …but lots of equity…but lots of equity You may fall out; they may be crapYou may fall out; they may be crap Google chef problemGoogle chef problem
Marketing c.f. branding, selling.c.f. branding, selling. Review sites 10-15% paid-forReview sites 10-15% paid-for Media – News sites, papers, TV, radioMedia – News sites, papers, TV, radio Blogs & forumsBlogs & forums Your users – word of mouthYour users – word of mouth Every contact you can beg to help; LinkedinEvery contact you can beg to help; Linkedin Your logo and websiteYour logo and website Advertising?Advertising?
Competition Is anyone else doing this?Is anyone else doing this? If not, why not?!If not, why not?! They validate the marketThey validate the market Learn from their mistakes and triumphsLearn from their mistakes and triumphs Are you better? How? (but c.f. Betamax)Are you better? How? (but c.f. Betamax) Can you partner with them?Can you partner with them? First mover advantage vs Never have to educate your market.First mover advantage vs Never have to educate your market.
Whos competing with..? GoogleGoogle SkypeSkype FacebookFacebook PayPalPayPal YouTubeYouTube eBay..?eBay..? Would you want to invest in Bing / Google+ ?Would you want to invest in Bing / Google+ ?
Evolve Friends Reunited 2005, sold £120m2005, sold £120m 2011, estimated £5m2011, estimated £5mMySpace 2003, sold $580m2003, sold $580m 2011, sold $35m2011, sold $35m Early search engines – Altavista etc.Early search engines – Altavista etc.
...Does Not Come With A Free Hat
Were sorry. Weve let you down…Weve let you down… Weve let ourselves down…Weve let ourselves down… But worst of all, weve let our ratings down.But worst of all, weve let our ratings down.
Impact of a single 1-star review on your rating Current rating Cancels out this many 5-star reviews
Seek Professional Help IP lawyers, corporate lawyers, accountants, will all give you a meeting or two for free.IP lawyers, corporate lawyers, accountants, will all give you a meeting or two for free. They want your long-term business – you might be the next Google :-) But once the clock starts ticking it gets very expensive very quickly!But once the clock starts ticking it gets very expensive very quickly! DIY can be even more expensive if you screw up.DIY can be even more expensive if you screw up. Banks give you a load of free stuff youll never have time to read.Banks give you a load of free stuff youll never have time to read.
What not to do Careful who you partner with / take investment from. MBA feeding frenzy – some are great though. We only need to sell to 1% of this market to be rich If at all possible DONT: hire friends to do initial programming because you have no moneyhire friends to do initial programming because you have no money commit to organising the biggest, most expensive event of your life (wedding)commit to organising the biggest, most expensive event of your life (wedding) move repeatedly as landlords sell from under youmove repeatedly as landlords sell from under you get more into debt by doing all theseget more into debt by doing all these
Sometimes the only way to win is not to play the game.
Useful links Mitchell & Webbs take on The Apprentice:Mitchell & Webbs take on The Apprentice: things-ive-learned-from-founding-4-technologyhttp://betashop.com/post/ /90- things-ive-learned-from-founding-4-technology Loads of advice, lots of contradictionLoads of advice, lots of contradiction
Finally Get everything in writing & witnessed. Products take twice as long as you think they will to reach market. Be realistic – Dont ask for £1.2m You may do everything right and still fail. Or vice versa. Good luck!
Dr. Tim Willis PLEASE RATE FLEXPANSION make him happy