How can we foster start-ups and innovation in Ireland today?
I am on a panel at the Digital Media Island event tomorrow night.
Line up is pretty good but I need help with the subject line.
How can we foster start-ups and innovation in Ireland today?
So I am asking YOU
Whats missing? what would make your life easier? what would help you grow your company or get it off the ground?
I will ask your questions I promise.
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53 comments...What do you think?
Trackbacks...
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I’m obviously not in Ireland, but I’ve found local support for building local social media networks, and lots of money from the likes of 4iP, or people who acknowledge that there is no proven business model, are very welcome.
Help and support people to try and fail small. So they can learn and be ready to succeed big. A bit like what your were saying saturday.
Give 10-15k and incorporation documents to anyone with a reasonable demo (to be established by some tech mailing list, threshold is just “not entirely crap”). No strings attached. Worry about people abusing its freedom, and program costing too much, if and only if it actually becomes a problem .
Ireland needs to make a similar effort for broadband to what Eircom made for digital exchanges 20 odd years ago. If you look at countries like Korea and Japan, if you provide ubiquitous affordable broadband the innovation will follow. Do it right and the country could quite easily leap-frog the UK which is about to come a cropper due to BT’s apparent lack of ability to support IP v.6
Here s a list,
Somebody (EI, Digital media forum) needs to create a social network for Irish Entrepreneurs so we don’t end up blasted and unfocussed all over the web.
We need access to capital in 100k, 1m and 10m chunks as we grow. The 100k chunks can *not* be matching funding. This should be a pure cash injection.
EI, The incubators etc. are not qualified to pick so stop trying to select who gets funding based on a sectoral analysis. (e.g. we fund telco, we fund biotech, we fund web 2.0 etc.) Nobody knows what will be big next year.
We need to aim for 150 10m valuation exits each year rather than 2 100m exists. The 10m exits are usually better value for the founders/entrepreneurs and founder staff.
Less paperwork from EI and a better website.
Higher limits on the total amount of BES that can be raised and a 200k max per indivdual. If you can manage it you should be able to raise 5m via BES.
Change the currency symbol on the seed capital application form to a euro.
Link each year of incubator graduates to their predecessors and link all the different incubator programs together (HotHouse, Genesis, M50, LEAP, NISP).
Change share options schemes so that people who exercise options which become worthless are have no tax liability.
Get more students doing technical subjects in College.
Celebrate our successes more widely.
A better dissemination of information about available supports would be great. If I didn’t follow a load of bloggers, I wouldn’t know half of the supports available for start-ups, which means a whole heap of people know nothing about them.
Interest-free medium-term loans for start-ups is also worth considering, though Alan is quite right to suggest encouraging people to try and fail small.
Access to ongoing coaching/mentoring from international social media entrepreneurs would be amazing. What about a matchmaking scheme between Irish start-up and Valley veterans.
Also not in Ireland but a forum or other means of asking for and receiving assistance with the administrative aspects of running a business would help. The amount of energy wasted on messing with government bureaucracy could be applied towards thinking and innovating. My experience is that clerical folks don’t understand and don’t care - their job is to make sure the i’s are dotted and the t’s crossed. There is no incentive to get you on your way. Endless wait times over the phone or for a response to an email further add to the aggravation.
Imagine a one page form that captured everything ONCE!
(also a Paul, and also not in Ireland)
One thing that I think would be very beneficial is a panel of people, or a group meeting setup, where you could bounce ideas off people. Often times people thing they have that killer idea, go away and develop it for months (some years) and then they realise that they should have gone in a slightly different direction.
Some points this group could look at would be say,
how can you make money with X
what other ways can X be used
is there a need for X
Obviously this panel would not be an exclusive fixed set of people , rather it would be a broad range of people across different fields.
If this could be done for North/South/East/West with individual groups. Maybe this could be a tie in for an OpenCoffee (not that I’ve been to one)
Paul
A simple central resource updated by people who have been through the funding system to explain where and how grants/funding/networking etc works. This would save people’s time enabling them to go and focus on bettering their product
* Make a co-working space mandatory in each of the Enterprise Centres around Ireland which EI appear to be continuing to fund.
* Retrofit a co-working space into all existing enterprise spaces owned/funded by the State
* Impose a “purchasing from small start-ups” ICT quota on each State and Semi-State outfit
* Make it mandatory for any Gov/State/Semi-State employees who directly support start ups to attend events/training/workshops and mingle with their clients
* Force Third Level staff dealing with the private sector to work private sector hours/days/weeks
keith
Standard “neutral” legal docs for early stage investment. Ycombinator are doing this in US with WSGR. Damien blogged about it a while ago.
Easier access to funding to start up would be the main thing for me (and I think Patrick’s idea above is an excellent one). For me, matching funds is an unrealistic target when trying to get off the ground.
A point of contact that can provide a clear overview of financial and other supports available for startup companies. This could be in the form of a managed library of resources, or as pointed out above,some form of social network. Any knowledge I’ve picked up on this sort of thing has been done by spending lots of time on the web. When I started out 12 months ago, I had no idea where to look.
Educate students on available support as early as possible!
Enterprise programs, grants, mentors, incubation centres - too many students leave college with no clue about the huge amount of support out there.
Just to add to Alan’s point about fail small, I completely agree. There’s too many zombie ideas holding on to good people in this small island.
@Joe Ditto on everything.
Social Network is in the works as we speak
I’ll be doing a series of video interviews with EI guys about their various business supports at home and abroad starting next week. That should help a little hopefully…
@Patrick Collison Agreed me and Pat Phelan have chatted about this type of thing before.
@Paul Savage There are countless experienced people who are more than willing to help. Go to any meetup and tell people about your idea. Formal panels aren’t advisable for a whole host of reasons.
The only thing I can add is this. I believe we need to stop thinking of Ireland in the context of only Irish Entrepreneurs and take a global view. If we want to create the kind of excellence they have in other tech hubs we need to be looking for the best of the best. Where they come from is irrelevant they will add to the Irish exchequer and Irish Jobs and will enable the Irish startup economy.
There are those that will say that will mean greater competition for Irish entrepreneurs. That’s true but all the evidence suggests that that is exactly what’s required to have a thriving tech sector. Encouraging expertise into the country is always good. Encouraging the right kind of expertise is vital, the types of personalities who are willing to take a risk on starting there own companies are worth a thousand of the experts locked into a large IDA backed multinational, to the Irish Economy.
Following on from Patricks comments. Also include,
o A share option scheme
o Heath and safety statement
o Employee contracts
o IP restrictive convenants
best of luck tomorrow Pat
there is a huge gap for a y combinator type companies in ireland, ie those who take a max 10% stake in a startup company, and offer 100% funds to unlock the matching funds nonsense in EI. i am currently populating my ycombinator style board with handy mentors/standard service providers for startups. ie, company secretary, ip solicitor, decent accountant, health and safety person, etc. all these people will chip into the funds, provide pro bono services and share in the benefits if the startup succeeds. there is room for plenty of these companies in ireland.
Having an option to get a low-cost accountant would have saved me big bucks in the start-up cycle.
It is imperative that Enterprise Ireland unleash one of its vibrant and creative employees to be the social networking point of contact and event evangelist. That social network should offer low-cost personal property insurance and a group health insurance scheme for those in receipt of EI assistance in their early days of starting a vetted business.
In some ways, the fact that we have EI is something to be grateful for, but they could he more helpful and supportive. I know folks up North are a bit jealous. The EI processes, forms and changing rules are frustrating. Grants are useful, but probably need to be a little more. The matched funding is fine for larger funding requirements and I understand why EI would want their investment to be matched.
The more significant problem I have is that Ireland is spending huge amounts on research. I don’t know the recent figures but SFI have invested over €0.5bn in reasearch and I’d love to see the ROI on that. It’s kept our academic institutions full of bright people, but what has it done for GDP and employment. I’m not saying we don’t need research, but I think the balance is far to heavily skewed towards the less commercial side of R&D.
For people not working within the large profit scope required by EI, the enterprise boards need to be better educated on non-tangible merchandise. As it is, they are only willing to offer support for people who are selling things they can see and hold. They need a serious education in IT and the internet.
For startup survival it’s very much the “cash wall” distance. EI at the very least have a mandate. After 25 years in the software business in Ireland dealing (or not bothered most of the time) with these folks here is what I would ask:
1. Why do you purchase products from US and UK firms that already exist here?
2. The etendering system sucks and favors larger firms. Why can’t you change it to specify smalller chunks of work?
3. Stop thinking that job numbers as the measure of success. It’s what your political masters want but what do they know. Job numbers are a measure of inefficiency in my book. Focus on “new enterprises created” instead.
So many small firms have to be about the “exit” in order to attract investors.
What a good exit strategy looks like on paper, especially in terms of figures, needs to be reviewed and approved by those who have been there before.
Mentors!
Mentors!
Mentors!
I agree with Patrick Collison and Bernie Goldbach. There should be some form of network set up which has partners such as:
- Legal Firm
- Accountancy Firm
- Corporate Finance Advisory Firm
All these partners will offer a certain level of service to members of the network in order to set up a company properly, get the finances running smoothly from the get go and give advice and contacts for fund raising. This can be free or incur a small admin fee but the partners would be giving their expertise for free in order to establish a relationship with companies who could become major clients of theirs in coming years.
I’ve become a huge fan of the incubation centres and schemes since we started on Genesis in the Rubicon in CIT. They give you a start-up environment along with lots of training and guidance. The Sales/Marketing mentoring we are getting right now is pure gold.
However, the funding side of these schemes remains problematic. The only way to get non-matching-funding is via CORD (which is based on your previous years salary). Many people are failing to get CORD and I know of two great start-ups which have had to shut up shop in the past few weeks because they ran out of cash before the revenues started coming in.
I honestly believe that Genesis (and M50 Enterprise etc) are not that far off the Y Combinator model but cash must be made available to everyone who is accepted on the scheme so they have some chance of success. I know many founders would be happy to give CIT a few percent of their start-up for €35k.
Seconding Deborah. These people need to SERIOUSLY update their standards for what qualifies for “capital investment.” It is entirely feasible for a rapidly expanding Irish company delivering an online service to not be able to find any funding from EI to add racks of servers to their cloud because they would not qualify for a capital grant.
Duh.
Pat,
For me its all about sales –
There are two aspects to this, the first being that we need to ensure that our start-ups have the opportunity to develop their selling abilities.
The second which I will focus more on for this post is that we need start-ups to be able to quickly establish case studies and references in live productions environments – rather than being left with wishful PowerPoint slides.
I believe this can be achieved if the government take a more active stance on buying from Irish Start-ups and also encouraging large enterprises and SME’s in the state to do so also.
The essence of my suggestion is:
1 - The government should have an explicit target each year as to how much they buy form Irish firms and part of that should be reserved for Start-ups.
2 - I believe very strongly that there should be generous tax incentives for corporations who purchase products and services from designated start-ups.
Cheers
@plennon
Some sort of assistance getting your first employees would be a big deal. Even if it would be limited to taking them from the pool of potential workers on the Dole at the moment. Plus the contracts, protection and benifits that using a temp agency gives.
(Personal grip of mine at the moment after a social welfare officer told a new employee he’d be better back on the dole than earning 11 euro an hour!!!)
Also free / cheap clinics for start up businesses to call into (or e-mail) and make an appointment to see a lawyer, financial advisor or anyother type of mentor for upto 15 mins at a time. Not necessarily to get answers but to ask is this possible?
Seconding Deb and Sabrina. Enterprise Boards and EI are very anit-websites/non tangible products in recent years. As Conor said, the funding available to these businesses is limited even on enterprise programs.
However, on a positive note, I am similarly having a great experience on the Genesis Program in Cork and have found that the non-monetary elements are as important (possibly even more so) than funding.
An area that I failed to understand initially and I know many other businesses are the same, is the hierarchy/structure of EI and the Enterprise Boards and how these 2 groups interact with each other. ie. where one ends and the other begins.
Of huge impact on me has been networking groups (not the expensive ones!) such as OpenCoffee, Digital Media Forum, BarCamp etc. They have been fantastic ways to meet other entrepreneurs and generate ideas. As with anything though - you only get out what you put in and people need to get out there and get involved with the business community around them whether that be localised by region or by business type.
From my own experience with startups there is a daunting level of red tape and paperwork not to mention accounts in this banana republic. Innovators should be allowed concentrate on developing their ideas without the worries of other areas of the business. Incubation services should provide complete back office support until Companies have the resources to manage it themselves. If this was done properly it could also provide benchmarks and milestones to help with the development of business within a standard framework for the industry. Also if grants were provided without political motivation it would add fairness to the whole area. Way to much corruption at the moment.
1. Mentoring and Advice especially in the early days is essential. Not bad at present but could be much better
2. Access to funding, I’ve heard too many horror stories about EI, plus good ones too. There appears to be no clear cut direction depending on whom you speak to, this is a deterrent. Clear up that mess EI and people will at least know what the position is. Private investment is a lot better than that, but very closely guarded and difficult to reach.
3. Trust - Nobody wants to speak about or show anything at the early stages. You don’t get the dollars if you can’t trust someone with your idea or evangelize it
4. Legal requirements are substantial and while I can appreciate why they are there, they need to be streamlined so as not be an obstacle.
5. Tax Breaks - more of them for startups, self starting individuals, investors. Encourages investment. Always has, always will
6. The google/facebook/myspace syndrome - everyone wants to be one, however there are valuable markets going ignored especially in utility computing services because no one wants to invest here in such activities, they all want to invest in the next global thing. A 1 or 2 million dollar business in something such as utility computing/services is still a 1 or 2 million dollar business. By being successful at one opens up all sorts of opportunities and doors that can be exploited and may eventually lead to the next google/facebook, but its a path to be traveled not just arrive at destination.
Focus on selling through, not selling in. Too many startups get all excited when the strike a partnership, but never look at what it takes to get the partner’s customers/users to adopt.
By focusing on selling through and having a series of programs that can enable that, the startup actually attracts users who can evangelize, versus only a partner who won’t.
I think the support bodies [EI, Seedcorn, CORD, incubation centres] can learn from likes of Seedcamp/Ycombinator/techstars.
In the web related biz sector - your survival or success can be dependent on the availability of help [angels, vcs, advisors, mentors, acquirers, partners, media coverage] - and that help can come cheaply via the opportunities to engage with your peers [works pretty well in San Fran]
As Conor says we’ve some good support in place, but as per Joe, John, Campbell - millions is wasted on needless administration, me-too type academic research, etc.
Re: Mentors
Better vetting of Mentors by EI. More transparency/history for start-ups about the Mentors.
I agree with a lot of the above and like to expand of failing small. Fail small and fail fast.
It would be great to be able to put together a group of people to work on the bones of an idea to get it to the point where you know if it is likely to succeed or not, and reach this point quickly - codesprints if appropriate.
Given the lack of credit, rather than have to get funding, borrow or give out shares at this stage, people could volunteer to do a certain piece of work and to be paid over the odds for their work if the product becomes profitable.
I don’t think I can add anything to all the excellent ideas above but just to say thanks Pat for asking the question that has teased out the most illuminating discussion I’ve yet read on this topic.
Delighted to have you along tonight Pat. This discussion here has brought so many people into the discussion that it’s worth it by itself, some fantastic contributions here. A pleasure as always
Here in Wisconsin in the States we’ve been having some great successes with Inventors & Entrepreneurs Clubs. The clubs establish a social network and a path to resources for people that previously were isolated in their efforts. Check out this site for more info.
Sorry - correct link is here.
Pat,
- The Y-C model can work in Ireland; but the structural and cultural issues associated with VC & EI mean they are unlikely to drive it. Y-C, betaworks, seedcamp, and techstars are primarily driven by entrepreneurs - not VCs or agencies. If a group of entrepreneurs in Ireland with the time, energy and contacts can make it happen, then EI, InvestNI & potentially some VCs need to hand over €1 million NSA. Chump change that they might never see again - but single-handedly the simplest and most effective way to seed a new generation of Irish startups.
- Two other key components of Y-C are mentoring - which can happen locally - and contacts/demo day. EI can help by facilitating a Paddy’s Valley type trip to London & SF for startups in the program. (Not a brain drain: just get them out there in front of investors)
- Enterprise Ireland: I can’t find the Apply button on your site? Why do I have to deal with Revenue to get funding? Why are feasibility study grants, (the _first_ point at which people need to spend money) only paid retrospectively?
Great idea Pat to get peoples suggestions on this topic. Good luck with tonight
Aileen
Great idea Pat to get peoples suggestions on this topic - very interesting ideas - good luck with tonight
I think there needs to be a more active solicitation of new ideas.
There needs to be more agency investment in TV/Press ads advising people with half-baked ideas what help is available and what they need to do to qualify to get that help. A lot of ideas never get out of the garden shed because people don’t know what to do with them. Anyone working a day job and building a prototype in the evenings has very little time left to wade through the red tape to find out how to access any available help.
There may be more help available than people realise.
Some great ideas in this blog, but I have heard most of them before. Lots of things are being done out there, but much of the money is going into ideas that will simply not fly when they go to market. I believe that more investment should be made in weeding out the non-flyers and focussing on the potential winners before the money is spent on grants, mentoring, start your own business courses, etc. etc. etc. (i.e. providing jobs for a large number of civil servants!) Detailed market research and a strong market entry strategy should be the number one priority, before the prototype is built, (and time and money wasted on delivering a product without a customer). Just imagine yourself in the Dragon’s Den without a potential market !
@niall smart - try https://secure.enterprise-ireland.com
@dave. Thanks, I just registered. (is that new? I must have missed it on the last visit)
The comment was meant in a more generic sense though - it seems that submitting an application online is only the first step in a long complicated process, which will involve dealing with Revenue, accountants, etc. I’ve applied to Seedcamp, AWS, and Y-C this year - and in all cases the process is as simple as a one-page online form and decision in <4 weeks. The questions are simple: what are you going to build? who needs it? how are you going to make money? Right now I’m looking at page 7 of the ten page feasibility study grant application, and it’s asking me what kind of mileage I’m doing…
Now that’s not to say I won’t be applying
But it could be made a whole lot simpler…
I’m a bit late here but a few things strike me:
the HSE is ripe for the creativity and inventiveness of the Web 2.0 social media people in Ireland. I don’t want them just to buy from Irish companies but to open up to ideas, to network with us and to launch 100 small projects that would change their culture and save them millions. Ditto lots of state bodies. The market for web 2.0 and social media in the public sector is huge, captive and in need. Now that Keynsian economics is back how about a Keynsian entrepreneurship programme?
I also think Irish entreprenurs are sharper the more time they spend in places like San Francisco so without asking EI for free holidays is there a case for a few roundtables on “frictionless entrepreneurship” of the kind that has evolved there? Europe won’t support more than one Silicon Valley and yet we expect to see mini valleys in every country - maybe there is a virtual frictionless entrepreneurship project that EI could support.