Posts Tagged ‘venture capital’

free-wifi

I talk to start-up entrepreneurs in the technology world on a weekly basis. They tell me about the day to day tribulations of their worlds, often top of the list is closing out their first proof of concepts in the enterprise field. The theme of the conversation is often all about the twists and turns they have to make as a company just to get in the door of a major brand company to prove their product or service can perform in a professional business environment. Never mind worrying about whether there is a business case in terms of ROI.

So let’s say nine months in they get the target company to agree to a limited trial of whatever they are selling, often cloud based services. Amongst many these range from mobile payments, traffic location beacons, battery charging stations, ticketing and hospitality applications.   Perhaps a limited number of offices, shops or arenas to start with, not all based in London as they had hoped for to get easy and economic access with their limited support resources . But spread out all across the UK the client wanting to test the robustness of the service in different regional settings, sometimes ranging from Glasgow to Plymouth.

But full of the entrepreneurial spirit and confidence in their world class engineers that have refined their products they set off to install their services. Most of the time they get away with it, they turn up and with a bit of fiddling with their platforms and network hardware they have bought in they are able to connect to whatever WiFi network that is already incumbent in the target company. Sometimes they use 4G routers if that is the only option if the internal networks are locked down. So the trial starts, perhaps over ten different sites and they are monitoring their services from dashboards built into their products for that purpose. Checking the traffic data which is so often a key feature of their offerings to justify the service is being used and the data is valuable to the client.

Then the inevitable review meeting with the client to discuss the data and how it is going, maybe 45 days in and that is when a few blips in the data begin to surface. You knew this before the review because you have been more keen than the  client to analyse the data. To cut a long story short it would seem two or maybe three of the sites are only performing intermittently and the potential client is using it as a block before they will discuss any further rollout or progress on the negotiation.

Now you have checked your systems and platform with the engineers back at base (not necessarily UK based) and they are convinced from their end that everything is functioning well. But you are the sales led Founder or VP business development faced with the client at the sharp end who does not want to hear anything but definitive proof as to where the issue is and the proposed solution. Sometimes even that won’t be necessary as often you have one shot at this. That twenty percent failure rate, which if they are talking about a rollout of even 250 sites equals a potential 50 sites not functioning properly, would already kill the opportunity stone dead for you.

So it is here that I must declare an interest, I advise Wireless Design Services International WDSi Group a vendor independent professional services team who are world experts in WiFi and other types of network services. It struck me some time back that their expertise in these network areas could be of immense value and support to growth start-ups. Particularly at that proof of concept stage but also if successful in terms of how to rollout professionally, economically and at speed across the whole estate.

So what are a few of the things we have learned from real live proof of concepts we have ended up supporting over the last year or so. The start-up  lands and the incumbent supplier of WiFi won’t even give them an SSID to link to their network, it is not in their interest to be helpful. Even if they do there is so many other critical services running on limited bandwidth it does not make your solution shine or even work. You try to bypass their network by installing your own hardware, perhaps bought in 4G routers which you have no experience of, which then prompts delays from minor details like where they are to be stored, positioned and powered from. Even if you get them in for some reason the signal seems not to stay constant throughout the day or the router goes down and needs replacing.

Inevitably you end up talking to the internal telecoms team of the client, who are nearly always remote from the marketing teams you are selling to. They generally are protective of their networks and won’t allow access particularly to start-ups with no network experience or credentials. They speak a different language, not from your world of expertise and become another barrier to entry. Even if these layers are breached it requires years of experience in design and consultative challenging environments to get WiFi/4G to function at an acceptable SLA level that will get you over the line with an enterprise client.

There are a myriad of reasons why WiFi/4G/Networks don’t function particularly well in challenging environments (the start-up world) and I would be so bold as to say you don’t really want to become an expert in any of them while trying to build out and scale a growth start-up. Rather you need to “stick to the knitting” as we experienced entrepreneurs say and not divert your attention from executing your business plan.

Sure there is a cost to outsourcing the installation, ongoing monitoring and field maintenance support to experts like WDSi, although they do recognise the need to be and are competitive in the start-up world. At the early stages of the POC point on the curve I would and have seen it myself previously as a start-up Founder allocated as a necessary marketing cost in the business plan. If those early trials do not go well, even if your services are one hundred percent and it is the networks that are at fault, you may never gain sales momentum again.

rat in my kitchen

It all starts so well, swimmingly in fact, you as the young Founder/CEO blazing a trail with the latest technology making a major impact in the market. So you have a founding team, perhaps with engineering, operational and financial skills to match and balance your business and marketing bias. Seed capital provided by a couple of names in the industry that have helped not just with the money but really opening up the network. They in turn after some key wins have introduced you to a particular venture capital company and you have closed an A round giving you the rocket fuel to enter the US market.

You have filled out the board room, one of the private investors, a representative from the VC, a Chairman like figure that the VC recommended with long experience of your sector, an experienced VP of sales from one of the established brands, and of course your co-founders. The board meetings are purposeful and you are learning lots of new stuff, even more so at the dinners and lunches that follow as you bond with the board members. So it all feels good, they are great support, you can ring them up any time to pick their brains and of course they are beginning to learn a great deal more about you, your ambitions and capabilities.

You are running flat-out managing the team and company during the day, catching up with the administration and contract detail in the early evening and hitting the event circuit for product exposure later on. This gives you little time to gain a perspective on where you really are, how committed people are internally and what conversations are going on about your company elsewhere that you are not directly involved in. As Andy Grove at Intel said “Only the Paranoid survive” well he was talking about a bunch of things to do with change, but it is a good line to focus on. At some point come hell or high water things will change and you better be ready for them.

What you have to understand is that you as Founder/CEO are on your own, despite the appearance that you have all these people around you that are seemingly becoming friends. In business you have acquaintances, fellow board members, maybe colleagues, but let me assure you no real friends. The reason being people in this particular adventure have vested interests, keeping their jobs, supporting their families, growing the share options, enhancing their shares, flattering their reputations and most of all limiting risk. Now that might come as a shock, you have started a company with these people, won the early deals together, travelled in economy together, built event stands to the wee small hours together and shared many a dinner and drinking session.

But when the day dawns when the company hits a major blip and it will, the pressure will build and when it does, strangely you will find that the buck stops right at your door. So what is the point I am making here, why am I in some way stating the blooming obvious, yes you are in charge. It is easy to lose sight of it, that’s why, you have all these players around you, a buzz of interplay going on. An adrenalin pumping speed of movement, which makes the silence that accompanies you at last when on your own at midnight, wondering what happened, wrecking your brain for the solutions, even more deafening.

Even if they all in the end do turn out to be great people and continue to support, just be ahead of all of this, be prepared, build your own trusted support team and be slightly cynical throughout …. Just in case.