Copacetic

John Tracey, Gerry Murphy, Aislinn Rice, Ian Murphy, Hal Wilson

Gerry: There is no difference between the domestic and global market. There are no walls anymore. Competition will come to you.

200 companies control 80% of world trade. You have to operate globally to supply these companies.

Ian: Certain segments can scale up. Allan McClay is unique in that he has invested all of his money back into the NI economy.

John: Can we compete? How should we organise ourselves? (People, market opportunity, product) Key element of competitiveness is domain knowledge. Fitness for purpose is key. e.g. Apple Computers are focused on ease-of-use.

Hal: More second/third generation entrepreneurs in Dublin than NI. Can we build businesses of scale, are entrepreneurs ambitious enough? Do we lack confidence? Need to show Irish entrepreneurs they can beat the world, but exposing them to the competition.

Aislinn: Need to develop sales and marketing expertise to expand to a global footprint. 96% of revenues come from overseas. Sales model based on a mix of direct/indirect. We have worked with a Chinese distributor for the past 5 years. He now runs the Andor Chinese office. Andor is a component of larger systems, therefore we need excellent partnerships. Andor growth is 30% year on year.

John: (Q: How do combat copying of ideas?) The type of technology that comes out of Ireland is complex and in the case of software the price tag is around 300k. By building in domain knowledge you make the product defensible. Product architecture and design lives at home. We prefer near shoring (eastern Europe) to Asia/India. In Indian your staff turnover is probably 40% and there are timezone issues.

Hal: If you are bulking up by acquisition then you need the skills to manage that process. NI not there yet.

Ian: I’d be much more optimistic. There are examples here already (Sean Quinn, Allan McClay). The Island economy forces us to move overseas very rapidly. There are successes and failures (SBP: One sold for 10m, another went into receivership).

Gerry: Job losses in Ireland are mainly in the multi-national sector. No such losses in domestic sector. We need to look inside companies to see the problems. Startup rates are very good in Ireland. We less successful at scaling businesses (e.g. the ability to make acquisitions). Business models are often inappropriate (no recurring revenue, not a repeatable business or service). Companies try to go it alone, need to use partners to scale. They need proper organisational structure as they grow (board and management).

Ian: Very expensive for Bio companies to sell in the US (1m per year not unusual). They need VC for this to work.

Aislinn: InvestNI has been very helpful to Andor. Trade missions, logistics, finding partners, opening overseas offices. Also helped find new offices.

Hal: (Q:How do you help with Partner recruitment?) There is no substitute for doing the work yourself, don’t embrace the partnering model before you understand your customer base and your own product. Understand the economics of your supply chain.

Gerry: (Q:Does the Celtic Tiger help Irish companies?) Everywhere you go people have heard about the Celtic Tiger. Its easier to approach Irish companies as a result. Makes Eastern Europe very approachable. Your in the door! We need to do more in emerging markets (India, China, Mexico, Brazil, the Gulf states).

John: (Q:Why take a risk with property so lucrative?) There are large emerging markets with significant capital spend (mobile, networks, broadband). Traditional markets (US, Continental Europe) have made investments. Emerging markets have no legacy systems (e.g. China is a mobile network only).

Aislinn: Our stable market customers are moving to the emerging markets and dragging us along.

Hal: (Q:Is innovation the key?) Innovation is important and differentiation is key. You also need to understand your customer.

This years Private Equity conference is hosted at the Four Seasons so we have WIFI access (and its free! shock horror!). The big emphasis this year is on biotech with all the speakers so far from the Pharma and BioTech sectors. Full notes will follow.

Enterprise Ireland Payment in Advance

Originally uploaded by Joe Drumgoole.

I got the attached letter today. If you can believe it, Enterprise Ireland, the government agency charged with fostering, encouraging the support of small businesses now wants payment in advance for its services.

Why? Why? What possible reason could their be for this other than some idiot bean counter ruling the roost.

Everybody I meet in EI is consistently helpful and well meaning, buts the organisation seems to an excellent example of lions led by donkeys.

Who makes these decisions? What is the justification?

I was at the Docklands Innovation Park Awards tonight to see Jonathan Mulligan of OpenPlain receive a cheque for €10,000 as the overall winner of the event.

OpenPlain is a subscription service that allows businesses to track the productivity of their employees by getting them to install a piece of software that monitors which applications are running and being used at any given point in time. It differs from the usual employee spyware in that it offers the user the ability to modify their own behaviour by showing them the stats that have been collected and comparing those stats with their peers. Yes I know, lots of people don’t like the idea of this kind of software, but so does Jon and more importantly he quantified it. 30% of customers won’t touch which leaves a very healthy 70% market share thank you very much.
Two other companies were up for the big prize. Pedantix (warning website has annoying audio), represented by Frank Fowley, and The Wealth Shop represented by Ray Langan.

Pedantix have developed automated software called FlightPAD. FlightPAD connects flight information display systems (aka, FIDS, the big board at the airport) with personal address systems and converts FIDS messages to PA messages that can be routed to wherever they are required. The software has been sold successfully to several Irish Airport authorities and their are obvious cross over markets to Malls, Train stations, bus stations etc.

The Wealth Shop is a retail play offering flat fee (€200) financial advice and planning to middle income earners (30-80k bracket) . They have software package that can produce a financial plan for each customer and they opened their first retail outlet in the OmniPark, Santry in Dec 2006. They have plans to open several more retail outlets over the coming year. I want Ray to do my presentations in the future, he was fantastic.
In general the quality of offerings and presentations were excellent and what was most encouraging was that all these businesses are currently revenue generating.
Three companies also won highly commended awards on the night, PutPlace.com (blush!), G20 Technologies and Tochar Technologies. The commended companies only got to do a 90 second elevator pitch, so I encourage you to visit their websites for the full story, as opposed to compressing it even more here.

The standard was universally high and it’s a crying shame there isn’t a dollar of VC available at the moment from the big players in the Irish market.

Enterprise Ireland where is that 175m when we need it?

Google Adds domain registrations to its Apps for domains services. Its interesting for a few reasons,

• Its a service you pay for which breaks the Google model, but gets business customers like me used to paying for stuff
• Its in partnership with GoDaddy and eNom (a first I think for Google) to provide the service

Final note, I can’t see it on my putplace.com domain yet, so it may be limited to the US geographic region.

Panthius is a Dublin based ERP vendor for SMEs. This is a dense market to penetrate, what with Oracle and SAP at the high end coming down and Compiere at the low end coming up.

Still, I wish them the best of luck, always good to see new startups in supposedly impenetrable spaces…

Infoworld reports on the launch of Workday, a hosted ERP vendor founded by Dave Duffield and Aneel Bhusri. They are both ex senior executives of Peoplesoft. What’s interesting about this company from an Irish perspective is that according to the article they have integrated Cape Clear’s ESB offering into their base product.

Aneel Bhusri is already on the board of Cape Clear as a Greylock investor.

Could this be the exit chance of a lifetime for the Cape?

The following is a update on a previous review I did of virtual storage and backup vendors backup in March 2006. I’ve limited the set of vendors to those offering pure play virtual storage and those focused on pure play network backup. This excludes offerings from the photo sharing sites (Flickr, PhotoBucket et al), hosting vendors (e.g. GoDaddy) and social networks (MySpace and Bebo). I’ve also excluded those who are currently in beta and are not advertising price plans or business models.

Since I did the original survey the whole virtual storage market has exploded with rumours of both Microsoft and Google entering the fray, new entrants raising significant VC and a dramatic drop in prices for the major players.

Full size picture

The companies surveyed are summarised below, this is somewhat arbitrary selection based on Mike Arrington’s original Virtual storage review and my own experience of the space.

• AllMyData: Pure Play virtual storage with the added benefit of being able to share your own internal storage in order to contribute to the AllMyData storage grid. You get back what you offer on a roughly 10 to 1 basis i.e. for each 10MB of local storage you donate you get 1MB of secure virtual storage. This is a nice plan but it depends a lot on end-user trust. Tricky sell, when the world is telling you how unsafe the Internet is. Still benefits from being the cheapest kid on the block in terms of overall storage costs, regardless of whether you contribute to the grid or not. Their costs are probably dependent on a substantial proportion of their users contributing to the grid. Good luck guys!
• Streamload/MediaMax: Used to be called StreamLoad but are rebranding as MediaMax. There plan is to be your personal online media host. To this end they offer a whopping 25GB free for all registered users. BUT read the not so small small print. File sizes are capped at 25MB for the free plan (no storing your videos or DVDs please) and you can only download 1GB a month. So don’t expect to stream directly from here into you home wireless network (well not for more than a few hours). The pay-for-storage plans remove the file size restriction and increase the download limits per month to 10GB (premium), 25GB (elite) and 100GB (professional). Hmm, is it cooler to be elite or professional, oh the agonies of market segmentation.
• Amazon S3: I include S3 purely as a  price mark as it is just and API for developers at the moment. However ,while the ordinary Man in the street can’t use S3 directly, Jeremy Zwadony has collected a great list of S3 providers that you can download and attach to your S3 account. Most are free. The stinger with S3 is the bandwidth charges. Most of the other virtual vendors ignore the bandwidth costs because end-users can’t grok them, but Amazon wants other people to hide those costs for end-users (i.e. people like me). Still for the security of a big name vendor combined with a great price, S3 is hard to beat.
• Xdrive: XDrive was one of the bad boys in our previous survey coming in at a whomping $100 a year for 5GB of storage. However AOL obviously shook some sense into them and now you can get the same 5GB absolutely free. They also have a nice downloadable client that setups another labelled drive for access just like windows explorer. This is great for windows users, but the absence of FTP, WebDav or other access mechanisms means this client must be installed before you can use the software. This can be a pain if you are away from your own PC, and of course Mac users need not apply.
• Box.net: One of the first of the “new boys”, first with an API, first with a chunk of free storage (1GB) and recently in receipt of a nice chunk of change from Draper Fisher Jurvetson. You gotta love box.net who just do storage plain and simple. A big cheer for the little guy!
• iBackup: One of the old school (I was an iBackup customer until XDrive started throwing 5GB chunks around the place like confetti), iBackup’s strengths are in ubiquity of access. HTTP upload, FTP, WebDav, you name it they do it. This means they work real pretty with those lonely in the corner platforms like Linux and OS-X (the Mac O/S). Of course, they just can’t get used to the fact that somebody kicked the stool from under the virtual storage market so their prices (although dropping) haven’t kept pace with market trends. Still I bet they have a whole pile of incumbent customers paying top dollar ($20 per GB per year) who haven’t heard the news.
• Strongspace: Virtual space for superman surely! Strongspace people are big into security and won’t tolerate a virtual vendor that even considers using ftp. SFTP only Ma’am and you’d better know your gibibytes from your gigabytes. Of course all this security comes at a cost and with prices like $15 per month for 5GB (doh! I mean Gibibytes) maybe they are targetting the DoD as a potential customer. The rest of us should consider a lower priced vendor.
• iStorage: Now to make StrongSpace look cheap you have to get up pretty early in the morning. That’s no problem for theses fellas. They stayed up all night drinking so as to make StrongSpace look like good value. Each time I do this I have to double check my figures and gasp in awe and the audacity of these bad boys. Oh, hold on, wait a minute, now I get it, THEY’RE HARDWARE MANUFACTURERS. I can just see the meeting where the head of sales say “make sure those software boys don’t undercut our overpriced but lucrative disk business”. Don’t worry buddy, they didn’t.
• Fluxiom: You are taking the piss, no come on now, this is a satire site! The fact that you price your storage per MB ($36 per MB per Month) should be a giant RUN AWAY sign for anybody who comes near your service! I couldn’t even put you on the graph because all the other vendors disappeared in comparison.

There are a host of other services emerging as we speak. OmniDrive and MyFabrik to name two and of course if Microsoft and Google make good on their network hints then we could be in for some craic. Expect more upheavals in the near future as the Virtual Storage Vendors try and morph into network backup vendors and vice-versa.

The full table of price comparison data is available.

Next week, Network backup vendors.

I downloaded Hamachi today. What is hamachi? A very simple, secure way to connect a group of PCs together in a shared, private network. Its very slick, has good installation help and works just as expected.

Now we can all connect together and also connect with our (small number) of PCs and servers that live in the office.

You create a network, members join the network by entering a password and once they are on the network you have as access to their machine in an identical fashion to a machine on the same subnet. You can also access a web-server if they happen to have one running.

Its another piece of the jigsaw that includes hosted subversion, hosted servers, hosted email and calendar and hosted DNS management.

Dontcha just love external validation. Robert Sutton also believes in firing the Asshole (see rule 9).