Blogmatic

What do you get when you combine Knowledge Based Start-ups with the Industrial Revolution?

Come out to Democamp4 at the Clock Tower Restauant on Monday April 30th for the answer to this question and our de-cloaking announcement from Peter and I.

Cheers and have a great weekend.

Ian Graham

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Pat DiPietro is writing a series of articles for the OBJ regarding start-ups “Ottawa Tech Companies” crossing the chasm, sounds very similar to the series of posts I had regarding start-ups but, from a different perspective. The interesting point about all this is that there are now three perspectives on the start-up issue, Pats’, mine and the truth which is somewhere in the middle. Pat brings the VC perspective to the issue and I consider mine more the grass roots side of the equation. For each of the articles I will offer my comments on Pats’ point of view.

The first point is regarding 100 companies with funding over the past six years. If you look at how the numbers are distributed 70% - 80% of the funding initiatives were in the first three years. I also do not believe that deals on the cusp of the bubble 2001 - 2002 should be included in the equation. The state of financing for Ottawa start-ups is essentially a declining half-life that is approaching zero this year.

I believe the next point made by Pat is a good one and well taken. The lack of exits among the more mature start-ups in Ottawa is having a detrimental affect on new start-ups. Successful exits provide a new injection of cash to the eco-system and potential entrepreneurs with the resources to start new companies. This has not been happening in Ottawa over the past 4 years.

The key difference between my posts and Pats article(s) will be perspective. My perspective was from that of the foundation cohort, while Pats perspective is that of the investor in companies in later stage rounds moving toward exit and IPO.

Cheers,

Ian Graham

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Sales is an art and there is so much to know it is hard to decide where to start. There are all kinds of different closing techniques, the sales cycle and funnel or pipeline to consider. Anyway a whole bunch of stuff.

My experience in the area and how to simplify the process boils down to three elements; Need, Desire and Cash. In very simple terms you need all three of these elements to exist before you can close business. If you have only one or two the business will NOT close. However, if you have all three then there is a good chance that you can win the business and close the sale. When I am working to close business I test for evidence of these three elements and base my questions along the lines of determining if the three elements exist and if not when they will exist. If they do or will exist then this is an opportunity worth pursuing, if not then maybe it is time to move on.

Determining Need, Desire and Cash is a very simple way to work towards closing business.

Cheers,

Ian Graham

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My wife works for an animal hospital here in suburbia. Suppliers often come in to give them pitches on different products and supplies. They recently had two vendors pitching the same type of product back to back.

The first supplier came in at the lunch and learn session to pitch her wares. The pitch was monotone and the slides very factual. Everyone liked the food, but had trouble concentrating on the material because it was so dry. Who was that that who just pitched?

The second supplier set up a Jeopardy like game board with headings like “Ticks”, “Fleas” and other pests their products controlled. Instead of going through a bunch of fact based slides they had a game show. Everyone had a good time and enjoyed a very entertaining lunch hour. That was a lot of fun everyone said.

It is not only what you say, but also how you present the information and engage the audience.

Cheers,

Ian Graham

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My next two posts will be related to the “New Economy” post from 26-Oct-2006. Originally I had speculated that the economy was based on two segments: value and service with knowledge as an umbrella overarching and connecting both segments.

I have since had a re-think of the model and believe that the economy is more like three concentric circles. At the heart of the economy and the middle most circle is the Knowledge Segment. A transitional circle around the Knowledge Segement is the Hybrid Segment with contains elements of both the knowledge and service sectors. The third concentric circle is the Service Segment.

In my opinion the most important segment to economic development is the Knowledge Segment. I had originally called this the value segment but believe that the term “Knowledge Segment” is more appropriate. The Knowledge Segment creates value and wealth through innovation and the export of goods or services. Innovation creates new products and services that can be exported. Exporting goods and services injects new money into the local economy that would not have been there without the innovation.

The “Hybrid Segment” overlaps the Knowledge and Service segments. This segment can potentially create new wealth by exporting new processes and business models. Examples of companies in this space are IT consulting companies that develop custom solutions for clients. Often these custom solutions contain Intellectual Property that can be applied to solve the same problem to a broader market. The hybrid segment is a fusion of Knowledge and Service.

The “Service Segment” is the outer most circle and businesses that fall into this category derive their income from local sources. Companies in this segment while generating revenue do not, in my opinion, create new wealth for the local economy. The types of companies in the service segment are; restaurants, dry cleaners and similar type service businesses. I believe that this segment of the economy is also the largest segment and will grow and contract based on the performance of the knowledge and hybrid sectors and their ability to support the service segment.

Growth of the economy is largely based on the growth of the knowledge sector. A small amount of growth in the knowledge sector translates into much larger growth in the other two segments.

Tomorrows post is with respect to the Top 10 fastest growing companies in Ottawa and the relationship to this economic model.

Cheers,

Ian Graham

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With respect to last Fridays post on the three perspectives I thought an interesting follow on to that would be how perspective can change very quickly based on your understanding of the other persons point of view. The example I am thinking of comes from Stephen Covey’s “The Seven Habits of Highly Effective People”. The story was originally told with respect to paradigms but I believe it is also highly relevant to perspective.

Imagine your self on a commuter train on a quiet Sunday morning basking in the tranquility on your way to brunch downtown. At the next stop a man and his three children get on the train. The man sits down but his three children run up and down the isles, jumping on seats shouting uncontrollably and making a real nuisance of themselves. The man just sits there head in his hands doing nothing about the commotion. This continues with no end in sight.

You think to yourself can’t this man control his children. Why isn’t he disciplining his children? Finally you reach your breaking point and decide to go confront the man.

With as much politeness and restraint as you can muster you say to the man “Sir could you please ask your children to behave, they are disturbing everyone on the train?”

The man looks up from his head in hands and replies, “Oh, I am terribly sorry. We have just come from their mothers funeral and I guess this is their way of expressing grief.”

Your perspective can change in an instant when you understand and can relate to the other persons point of view.

Have a great weekend

Cheers,

Ian Graham

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The eBusiness Cluster Event last night featured Dan Willis from Adscape (now Google) and Brady Gilchrist from Fuel Industries. The presentations approached the topic of media/advertising migration from somewhat different perspectives. Dan is the founder and CTO of Adscape and talked at a very high level about the Adscape history and technology. Adscape was a pioneer and leader of in-game advertising one of the two key areas that is expected to fuel the growth of the gaming market (the other being mobile gaming). Fuel Industries is “the idea company” and producer of casual games used by companies as a new form of advertising.

Brady from Fuel had an excellent slide that showed a picture of advertising spend then and now coupled with an excellent description of how rapidly the model is changing. What struck me after seeing the presentation were the rapidity of the changes in the market and how much faster change will accelerate as the “Internet Generation” (those that have always known the Internet) reaches maturity. Basically there is a new life cycle to be understood, that of the Internet application and while similar to the product life cycle I believe it is also distinct. For example Facebook is now replacing MSN Messenger with the younger Internet Savvy generation.

Dan’s presentation really got me thinking about “why would Google acquire and in-game advertising company?”. Google is now moving into in-game advertising, radio and all sorts of other media. Google is no longer merely “the” search engine company but I believe has their sights set on becoming “the media” company.

By the way, why is it that Google comes up with a red underline (spelling mistake) in MS Word.

Cheers,

Ian Graham

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Thank you for asking.

Hmm … Let me think on this one for a bit.

I read two articles on the issue, one in the Ottawa Citizen and the other in the Ottawa Business Journal.  I believe it was in the Citizen where the article started with something like the project will require $100M to $125M in capital costs and have an operating budget from $15M to $25M annually. I find these sums mind-boggling and am also very concerned when the first thing mentioned about the project is budget rather than intended outcomes. Peter Drucker penned “Innovation and Entrepreneurship” and I would call the innovation hub a “Chapter 14” project.

Personally my preference is to see government incent the private sector to innovate rather than trying to re-invent the wheel. By that I mean all the pieces for the innovation hub in Ottawa, at least from what I have read and know, are already here.

Just think how many businesses could be started this year with $115M - $150M.

Cheers,

Ian Graham

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Democamp4 is coming up on 30-April-2007 at the Clock Tower Restaurant on Bank Street just south of the Queensway. There is a City parking lot right across the street.

Democamp is fun, friendly and a good opportunity to show off your latest technology creation or just come to watch the fun. Check out the link below and sign up on the wiki.

 http://barcamp.pbwiki.com/DemoCampOttawa4

cheers,

Ian Graham 

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The weather today in Ottawa is a fusion of spring and winter. Four inches of snow can you believe it.

Anyway this got me to thinking about the hockey playoffs.

You know how you can tell it is spring?

The Leafs are out.

A belated Ottawa to Toronto hockey joke.

Cheers,

Ian Graham

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