Maidsfield Blog - Partnering and Business Development

I thoroughly enjoyed Jerry Kennelly’s talk last night at the it@Cork Summer Event in Murphy’s Brewery.

In StockByte, Jerry established a clear vision and opportunity early on and went after it fabulously and whole heartily with great success. That is $135M worth of success when Jerry sold his companies last year.

With the vision at the very start and quickly establishing that they were ahead of the market, Stockbyte established themselves as market leaders and acted accordingly. StockByte were innovative on business model, marketing, delivery of their offering and collecting feedback from the market.

I really really liked:
1) how they marketed the ‘personality’ of the business to set them apart.
2) the constant objective to drive more streamlined scaleable business across the entire business
3) the fast response feedback loop to generate new product directions
4) the focus on high quality, high value and premium service at a relevant high margin price
5) the fast pace
6) the fun of it all, constant innovation coupled with constant business growth, there’s nothing better!

Well done Jerry.

This story and how Jerry delivers it should be bottled and used by Enterprise Ireland as one potential model in building an international successful business. BUT it’s definitely a lesson that it’s well achievable with the right mindset to start with.

I’m going back to work.

also see great write-up on the event at http://www.waveson.com/itcork-and-jerry-kennelly/trackback/

My current Dell has served me well for over the past 3 years. Some of the keys have the letters worn off and it’s starting to be a little beaten in launching applications. Anti-virus, Anti-spyware, firewalls and elaborate screen desktop systems are taking their toll on my processors’ capacity.

I’m looking at HP, Lenovo and Toshiba models. I think it’s the Toshiba M7 series with the 14.1″ screen. The others only have 12.1″ screens.

“Why a Tablet?”, a friend asked me. I’m an early adopter and I believe there are efficiencies in a using and becoming used to using a Tablet PC…..

I’m just spec’ing and pricing, but we’ll see…

Lost Opportunity Cost is typically the lost revenue while doing one thing as opposed to earning cash someplace else. The cash that would have been earned someplace else is the Lost Opportunity Cost.

I’m not saying that we should respond to every opportunity. I believe in quite the opposite. Pick your focus and move fast.

It’s becoming clearer and clearer to me that Pace is imperative and not acting with a sense of urgency causes you to lose out. Particularly as a small company on a growth path, you need to act fast when you see a relevant opportunity.

The core of the problem is this:

When we estimate the time to complete a task, we rarely try to do it faster, thus losing that time forever.

Completing the task faster is reducing your lost opportunity costs.

This is why I’m becoming a big fan of Eli Goldratt’s “The Theory of Constraints”. Part of which is about estimating individual tasks to be completed under ideal conditions with 50% certainty and manage the uncertainty at a more all encompassing level.

Being able to do forecast sales and meet them is magic. Isn’t it?

Recently, I’ve being reading many books on sales management. Many of theses books were from a large company point of view, with 268 sales reps and such. They were typically public companies with quarterly results to report and shareholders expecting the continuous growing sales and profitability. These companies would talk about the certainty required in the measurement of the sales process. “Having a few in the bag, just in case” was always a safety being used. “You must be paranoid”, another would say repeatedly.

When you can pay for the best of everything:
1) You have strong market intelligence of what the buyer wants
2) You know what the markets’ purchasing plans for the coming year
3) You know what you can produce and can move fast to add capacity for contingency reasons
4) You know your sales cycle and lead time to sales
5) You have a pipeline and understand the probabilities at the various stages
6) Your team of 268 sales reps are well trained and managed by the best

So what if you have none of these.

The principles still apply. Do what you can do.

Progress is everything.

People complicate business plans.

A business plan is a profit and loss forecast and the exhaustive set of assumptions to meet or beat this forecast.

Every number in your spreadsheet has a great number of assumptions behind it.

What are the list of questions that Bill Gates, Richard Branson, Your Accountant, Your Enterprise Ireland Development Advisor, and others would ask?

Listen to interview with Jeff, recently podcast by Tom Raftery on the IT@Cork blog…

Jeff Nolan is a Silicon Valley veteran who just recent moved on from SAP into a CEO position with Teqlo.

I’ve been a reader of Jeff’s blog for while and am looking forward to meeting with him and hearing his presentation at the IT@Cork Annual Conference on November 29th.

Jeff blogs about, among many other things, new business models for software companies, “Emerging Trends in Pricing and ROI”.

What Jeff has to say has implications for:

1) Software Product Companies
Should you continue to seek up front perpetual per seat type licensing deals or should you seek a recurring revenue model?

This changes the dynamic of your business significantly. It changes how you sell, who you sell to, the nature of your customer relationships, your support structure, your product development plans, your cashflows, etc……

2) IT Departments

As Jeff points out, Business Functions are buying solutions without consulting IT. They have their own budgets and require no IT infrastructure apart from a web interface SO they don’t need IT expert input in the purchase.

Where is the ‘Authority’ and ‘Power’ of the IT Department going?
Where are all the CIOs gone?

3) Financial Managers and Investors in the Software Industry

When big lump-sum up-front licence fees are gone, how does this affect your cashflows and working capital requirement to fund a growing business?

Software As A Sevice (SAAS) is happening at all levels of software to consumers, small to medium business and at enterprise.

Salesforce.com is an example at enterprise level and there are many more….

This is a fulltime position which means that I am transitioning out of Maidsfield. Maidsfield clients are being introduced to Whitehorsepoint Business and Marketing Consultants

Campbell Informatics (formerly Cliff Campbell & Associates) is a great company with fantastic potential, great people involved in the business and happy clients with tangible successes.

Campbell Informatics’ Avenio sofwtare is a very innovative Data Modelling and Engineering Data Management engine for the Life Science Manufacturing sector.

I’ve been consulting to Campbell Informatics for the past year assisting with business strategy and plannning and helping find a CEO….

It’s now my job, working with Cliff Campbell, the founder and now president, and the rest of the team, to grow the opportunities and the company’s capacity to deliver on them. I’m really looking forward to it…

Read more on Campbell Informatics website

“I feel like I just got home”…

I’ve been deliberately quiet on the blogging front for a few months now.

Particularly in the past six months, I realised I wanted to do something more substantial for myself. Maidsfield Business Development has been in operation for 3 years now and I am very happy with how Maidsfield, I and many of my clients have progressed.
So, over the past 3 months I have been in transition from Maidsfield to a new role. I went for and was accepted as the new CEO in one of my client companies.

Why did I decide this? - I must have been frustrating at times for some of my clients. I see the opportunities they are progressing and I just want to dive into the middle and help them drive it on. I have had this feeling so many times and had to curb my enthusiasm. I can’t help wanting to get my hands dirty.

I have informed all Maidsfield clients and associates and am transitioning the business to Whitehorspoint Business and Marketing Consulting company. I sincerely thank all those I have worked with over the past three years, it has been an enjoyable chapter.

Meanwhile, I will post more on my new role soon.

Vistech was a big part of my life. It was my first business, where I cut my teeth as a business person.

I have many fond memories of successes, great times, great people, great team spirit and great technologies developed.

Of course the latter years provided many tough business decisions and situations when I tried to recover the business to its former times after the damage done at the 2001 turn in the market. The last three years provided me with much more business experience that the previous six.

Am I happy how it all went at the end of the day? No, but I am happy that I dealt with all issues at hand in a responsible manner. I’m happy that when it mattered I had the support of many good people in the team to work through the tough times. Thanks.

Would I do it again?
- Yes I would, but better of course

This post is in response to Joe Drumgoole’s post: “Is the Irish Software Association worth the price?” and on the ISA 2006 Annual conference

If you’re serious about scaling your business, then today’s ISA Annual Conference, was most definitely worth the price.

So is E800 worth the investment in becoming a member of the ISA?

From today’s event and on ISA brochure, the ISA represents the growing software business. So its not about where you are now, its about where you are going.

I thoroughly enjoyed the half-day event in the Dublin today.

Following Minister Michael Martin’s kick-off the programme started with analysts/investors views of the marketplace. We heard from Andy Malik of Lehman Brothers, Eric Hjerpe of Athlas Venture and ex-Siebel senior VP, Melinda Ballou from IDC and Sean Foley from Microsoft.

These were very practical presentations of what works and whats in flavour. We got great information on business and revenue models. (More on this at some other time)

By 11am, I was already overloaded with valuable information and with 5 more speakers to go. But what followed were 5 real Irish technology business leaders who have delivered great international business success. Fergus Gloster, Senior VP Salesforce.com, Garry Moroney, ex-Similarity Systems CEO, Pat Brazil ex Eontec/Siebel, Sean Melly CEO eTel and Peter Conlon CEO Xsil.

The conference and the structure flowed with themes presented by the analysts/investors being supported and compounded by real examples from the technology business leaders.

This was a real “Get Off Your Ass” event.

I’m a soon-to-be member of ISA, again.

Congratulations to Bernadette Cullinane, ISA Chair, and the ISA team behind todays event.

It does need to be discussed whether ISA is a national organisation and if it is assisting new business owner/managers or just experienced business people.

Regional industry organisations, like IT@Cork, should work with ISA in the regions to jointly drive the international growth and leadership agendas.

This is not just about new inventions or radical pioneering ideas. If your business depends on changing standard practice ever so slightly then this adds further challenges to achieving your business goals.

Six Questions:

1. Might you describe business offering as leading edge?
2. Do you say that you have no direct competitors?
3. Have you ever used the words ‘radical change’ in describing your offerings?
4. Will your business change the structure of the industry, even slightly?
5. Do you welcome a competitor’s marketing campaigns because they are making the concept more acceptable?
6. Does making money depend on changing consumer habits?

If you can say “YES” to any of the above, then you will be likely faced with greater challenges in developing your business.

The Challenges:

1. Identifying your revenue streams and pricing models
- Will people pay directly for your product or service?
- Putting imminent revenue aside, briefly, what core value are you building? That is, are you creating something that other businesses might make money from? Is it a loyal customer base? Is it technical intellectual property?
- If you cant achieve sufficient revenue from those using your service, can you gain revenue from those targeting a similar customer base? Can you sell them other products or services? Does advertising revenue make sense?
- For possible pricing models, seek comparables from similar business models and/or indirect competitors

2. Double the sales effort: The Concept and the Service
- Do you need to explain your business idea in every sale?
- Particularly if the benefits are less measurable, you need to get over the ‘quack’ factor
- When trying to make a sale, you need the prospective client to buy into the concept first of all and then to buy from you

3. Avoiding being stomped by a big player
- If what you’re selling threatens revenues of large indirect competitors, beware of being too prominent too soon until you’ve gotten a foothold in the market.
- You might decide to chip away at the early adopters in the market to build up sufficient credibility and track-record and then to attack the greater market.

4. Winning initial reference sites
- No one wants to eat in an empty restaurant. So do the happy hour, work hard to win your initial customers and prove your service.
- You need to remove risks from the buying decisions of future customers. Solid evidence of a track record is hard to beat.

5. Validating your business
- Customers paying for and endorsing your service validates it above all else
- Partner endorsement validates
- Investment from a known industry leader validates
- Accreditation, Certification of recognised bodies validates
- PR, Celebrity endorsement and other strong promotional activities also validates

6. Forecasting according to early adopters?
- Early Adopters buy new into ideas faster than others.
- Do you ramp up your business based on sales successes to Early Adopters?
- Be aware of the length of the period from market entry to market acceptance and the costs of doing so

7. Raising Investment
- Investment organisations analyse business plans according to Return on Investment including Risks in achieving business goals. New ideas add risk but also may offer a high return.
- Private Investors with knowledge of your industry make decisions based more on instinct and experience, but the appetite for high risk varies.

Example: Broadband in Ireland

Despite vast amounts of time and money being spent on marketing, promotional offers and government support schemes, Ireland is still slow on the take-up of Broadband.

Broadband providers are of all sizes as the market possesses few barriers to entry. There is much distrust in the market as people do not know what they are buying and services can be poor from many providers.

Dominant players are difficult to displace as it takes time to move people from what they know already AND many don’t see the benefits clearly enough.

It takes time, layer by layer from early adopters back to the luddites.

Thanks to Guy Kawaski for heads-up on recent interviews with Apple founder Steve Wozniak and other ex-Apple nobility.

It is interesting to see that Guy himself worked as an Apple Technology evangelist.

Steve Wozniak was and still is a techie hero. I remember regularly reading in BYTE magazine in the mid-eighties (I was in my teens) of the on-going developments at Apple Computer.

Apple has always typified the techies dream. The passion and pride for the innovative technology and products was powerful but often over-bearing.

In many cases this passion has made the company to be more product/technology focussed rather than market focussed. Its early success in the computing world created a great momentum in the company that it was hard to kill even with the many product/market blunders throughout the years.

Steve Jobs return to Apple with a seemingly more commercial focus that in his previous term provided a great boost. Its good to see Apple still pushing the innovation envelope and being commercially successful also.

I started my career developing on Macs. I still have one of the first Colour Mac II’s made, a Mac Plus and one of the first Laptops (luggables).

Copyright ©1996-2008 Donagh Kiernan