Posts Tagged ‘Business’

Startup challenges for a small business

September 22nd, 2014

Steve Orenstein knows all too well the startup challenges of setting up a small business as he went head first into setting up his own IT support company at the tender age of 19.

“Having very little money to fund the business made things very difficult at 19, I would often have to use credit cards to get by and to help manage cash flow,” he said.

“Having had no experience in building a business, it took time to build up credibility where people didn’t care about my age and they focused on how I was able to deliver a service to them.”

Whilst running SMO Technology, Steve noticed that there was a need in the market for a cloud-based job management and scheduling tool that simplified the process of managing workers in the field. This became the philosophy behind Steve’s next startup, Connect2Field.

After just two years, Steve managed to secure first round funding by private equity investors in Australia and New Zealand, which allowed him to grow the business further. Steve says that developing a strong network is a crucial factor in securing investor backing.

“Develop relationships with people who trust you and you get along well with.

“When I raised my first round of funding I had already been in business for many years, so I had a good network of people and was also able to reach out to family and friends,” he added.

“Today, there are also many startup funds like Sydney Seed Fund which you can approach. This is a very good option in getting access to very experienced people who have been in startups before and can provide mentoring, along with funding.”

Investor funding allowed Steve to hire more staff but he wanted to avoid the expense of using recruitment agencies. Steve instead looked to social media, which he says proved to be a valuable tool for hiring talent and growing the business.

“I’ve got my own personal Twitter profile and anytime I’ve been looking for staff I’ve always tweeted about it, and someone who’s followed me has responded back, and said they’d be interested and would like to talk to me. I’ve made contact with them and gone from there and hired people through that.”

Having investors onboard meant that the company now had a board of directors consisting of specialists from various fields, effectively giving Steve access to a well rounded knowledge base.

“I had a board of directors at Connect2Field and would go to a monthly meeting and share my direction for the company. I would speak to each one of those board members on a regular basis to get advice. And I chose each of those members based on their experience in different areas of business. One was in legal, one was in marketing, one in sales, and one in technology.”

However, Steve says that learning what advice to filter was a skill he had to learn pretty quickly.

“It’s good to be open to ideas, suggestions, and advice from mentors and advisors. However, I’d also say that it’s very important to trust your own instincts and make decisions based on the information you have at hand.

A mere 12 months after securing investor funding, Connect2Field was acquired by Ireland-based global software-as-a-service vendor Fleetmatics, in a deal worth AU$6 million.

Acquisitions are a lengthy process and Steve says that maintaining the focus on growing the business during that period proved to be very challenging.

“There’s a huge amount of legal work, documentation, and due diligence that you have to go through. Your entire day is being sucked up by speaking with lawyers and the acquisition,” he said.

“Being as organised as possible in your business is vital to making that process go really quickly.”

Steve is now focused on his next startup, Zoom2u, a fast on-demand courier service that promises real-time tracking and delivery of parcels within hours. The business is expanding quickly, with plans to launch in Melbourne and Brisbane by the end of the month.

Steve says that his business journey over the years has taught him many valuable lessons along the way.

“I’ve always believed in making decisions based on what you think will deliver the best results rather than making a decision based on a mentor, who may only have a small view into what you are doing.

“The other thing to remember is that, being an entrepreneur, you will ride a huge wave with lots of ups and lots of downs, it’s good to remember this so that when you hit some hard times you keep pushing through and eventually you’ll be back up on top. Being able to ride the wave is vital to success, lots of people can’t handle riding the wave and may jump out too early.”

Source:http://www.zdnet.com/startup-challenges-for-a-small-business-7000033896/

When start-up follies come back to bite the mid-market growth business

June 6th, 2014

When you’re starting your own business, every cent counts. Most start-ups only survive the first few months or years if they’re run on a diet of austerity and hustling (they don’t call them lean start-ups for nothing). But if you plan to rapidly grow your business, you need to bootstrap with an eye to the future – by which I mean ensuring that your early decisions and processes are also able to scale.

Take the issue of business applications. Enterprise software counts among an organisation’s most important assets – it runs business operations and literally keeps the gears of business turning. Like any other strategic asset – if the business fails to effectively manage its software, there can be dire consequences financially and operationally. And small companies need to understand that software is one of the most difficult and complex of assets to manage.

Evidence of software management challenges can be found in recent research. Working with IDC, we ran a survey amongst Aussie firms with $100 million or more in annual turnover: the sort of businesses most entrepreneurs hope to grow their start-ups into one day. It turns out that nine in 10 of those businesses have been hit with remunerative penalties (what we call “true-ups”) for not complying with their software licences in the past two years – and of those, 65 percent were for a million dollars or more.

Most of these businesses, however, haven’t been intentionally breaching the terms of their licences. They’re what I think of as “accidental pirates”: organisations that have grown faster than their due diligence processes can keep pace with. As a result, things slip through the cracks: someone procures a tool on the wrong licence, someone else shares an app to a few too many staff members. Or a company uses an application in a virtualised or cloud environment – not realising the licensing implications of using the software in that way. And before you know it, you’ve got a million-dollar penalty on your hands.

This isn’t just about software, either. Rapid growth can be fatal if your operations and culture don’t keep up. Some entrepreneurs manage this by deliberately limiting growth or pacing their expansion, but that’s not always an option when getting first-mover advantage is critical. The trick, then, is to think about how easily your current business setup can scale up to match revenue and turnover growth, and do so from the beginning instead of retrospectively.

Let’s go back to the example of software. A typical start-up will gravitate towards free or almost-free applications, usually SaaS tools which allow members to collaborate and share information with only an internet connection. These apps, however, typically also have enterprise licences which kick in after you add a certain number of users to an account, and their costs are often significantly higher than free.
Proactively managing

This isn’t to say you should eschew a piece of software solely on this basis, especially if it meets a critical need in your business. But if you’re a founder, you should be putting processes and technology in place to manage your critical assets, before they get out of hand and potentially hinder growth. This is doubly so when dealing with SaaS apps, where remote storage of your data creates an additional layer of lock-in than traditional software.

In other words, your choice of software tools in the bootstrapping days can have a big impact on how your business matures. You also need to be proactively managing your software now – demonstrating that you are operating your company like a world-class organisation even before an IPO. And you should be considering the effect and frequency of compliance: almost one in two of the businesses we surveyed, for example, had been audited three times or more in the last 18-24 months.

I’ve talked about software licensing because it’s what I’m most familiar with, but the same issues apply to every aspect of the entrepreneurial process. Infrastructure, process, and compliance – these are the things which don’t usually worry start-ups, but can cause major stress for mature businesses. If you want to get your start-up to the big league, it’s worth making sure those bootstrap foundations can take the weight.

Source:http://www.brw.com.au/p/business/mid-market/when_start_market_follies_come_back_zbi43qAD44iMeiErfI5wMI

SAP Makes Fiori Free in Push for ‘Beautiful Business Software’

June 5th, 2014

In February, SAP AG chairman and co-founder Hasso Plattner nodded toward the firm’s need to do “some crazy things” and take more risks. “We have to be a little more like Google,” he said.

Ed DePrimo, CIO for North America at Landis + Gyr, thinks SAP should perhaps take its cue from another major tech firm. “If SAP needs to be ‘more like’ any other company it needs to be like Apple,” he told CIO Journal in an email last week. “The SAP user experience is appalling.”

SAP’s existing customer base, he said, “is eroding because we can no longer make excuses for this retro user interface.”

It looks like SAP listened. In a victory for end users, the firm said Tuesday it will offer customers both the Fiori and Screen Personas software for free. It’s welcome news to customers, who have been vocal about their displeasure at having to pay extra for a better user experience.

Fiori offers a set of apps that improve the user experience across multiple devices, while Screen Personas helps businesses simplify SAP software so that employees only see data that correspond to their specific needs.

SAP will give existing customers a software credit redeemable against future software sales, the company said in a statement. The announcement came on day 1 of its Sapphire Now customer meeting, where now sole CEO Bill McDermott is pitching his vision for SAP as a company that will beat back complexity and continue to innovate.

When asked if SAP should be more Apple than Google, Mr. McDermott told CIO Journal it was a “fair point.” In an interview last week, he said he recognizes the need to get user experience right. “This is the future. If you can take beautiful business software and make it easy to consume on a device like an iPad, you can change the game.” As SAP looks to serve a millennial workforce that demands a clean UX, creating applications that are easy to consume and easy on the eyes will play a key role in the company’s evolution.

The announcement about Fiori was a welcome one for Mr. DePrimo. “No additional fees for a great user interface,” he said in an email. “I’m impressed.”

Source:http://blogs.wsj.com/cio/2014/06/04/sap-makes-fiori-free-in-push-for-beautiful-business-software/

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