For our Start-up Advice series, we spoke to John O’Connell about digital transformation and the potholes that entrepreneurs should look out for.
John O’Connell runs Digital-edge.ie, which provides digital transformation expertise and scaling support for online businesses and early-stage companies.
Previously, he was international managing director of Trader Media, a Guardian Media Group subsidiary. There, he was responsible for online migration and growth of Trader’s international publishing businesses, including developing leading digital brands such as Carzone in Ireland and AutoTrader in South Africa.
‘The ability to see beyond problems, take the inevitable knocks, dust yourself down and go again is an ideal attribute to have’
What do you do?
Digital transformation doesn’t get any harder than in the publishing business so I’ve been able to bring some invaluable learning experiences to bear in helping companies replace legacy technologies, products and ways of doing things that are no longer compatible with their customer’s evolving digital world.
I am also an Enterprise Ireland Business Partner working with start-ups and potential spin-outs, which is interesting and varied.
Start-up problems generally revolve around issues such as flawed assumptions about the market, lack of proper validation, imperfect value creation, the inability to capture customers, etc. Not being immersed in the the day-to-day means I can help crystallise the key stumbling blocks to progress on many of these fronts.
Where are the greatest opportunities in science and technology?
IOT, VR, AI where do you start? Opportunities are and will be endless.
For example, we hear a lot about self-driving cars lately but some entrepreneurs are already looking beyond this.
The real entrepreneurial skill is in seeing the opportunity and creating a solution with value benefits that customers are willing to pay for. Technology without a real purpose usually ends up as a nice toy for those who built it as well as some of their friends.
There is some very interesting stuff going on here in Ireland. I’m working with a start-up that is using AI, advanced algebra and models of human audio perception to create the next-generation music editor. The technology enables studio engineers, DJs and producers to un-mix a music track for reuse in a new composition without having the original master recordings – effectively, it’s Photoshop for music and it’s been one of the ‘holy grails’ in music production for decades.
Are good entrepreneurs born or can they be made?
Entrepreneurship as a subject is growing exponentially in higher-level education. It can be taught but, ultimately, only to those who are prepared to take an idea, develop it and execute relentlessly to make it happen commercially. It sounds easy but not everyone is cut out for it.
A natural entrepreneurial skill set is often an evolution of someone’s background or educational experience. Many successful entrepreneurs, such as Jamie Oliver and Ingvar Kamprad (founder of IKEA), experienced learning difficulties and had to compensate for things they couldn’t do well. They developed excellence in other areas such as oral communication, problem solving and people management skills – all important attributes for running your own business.
‘A founder who thinks that he or she is smart enough to do it by themselves is simply not smart enough’
What are the qualities of a good founder?
Establishing a new business is loaded with difficulties so being an entrepreneur is a calling, not a job. Adaptability, resilience and relentless focus on the prize are key. The ability to see beyond problems, take the inevitable knocks, dust yourself down and go again is an ideal attribute to have.
A good founder also understands that they don’t have all the answers. A founder who thinks that he or she is smart enough to do it by themselves is simply not smart enough.
What does a successful entrepreneur need to do every day?
Validate relentlessly with customers.
To paraphrase a former US defence secretary, there are things that you know about the opportunity (eg the market size, competition, etc.); then there are some known unknowns – the things you know that you don’t know about yet (eg the likely user adoption of a new disruptive app); and many unknown unknowns – things you don’t even know that you don’t know about. These will emerge and can blindside a start-up.
Answers to many unknowns can be found by talking everyday with customers, potential partners and domain experts. This will add to the credibility of the assumptions that you will make about your business.
What resources and tools are an absolute must for your arsenal?
A good CRM system is a must for any start-up trying to scale.
How do you assemble a good team?
Finding amazing people is difficult. I’m not sure if there is one good recipe.
Be clear and detailed about what skill sets you are looking for. Diversity among the senior hires should be one of your goals. It’s important to have smart people to positively challenge your assumptions and thinking.
Social media has made it easier to identify talent potential, so selling your vision and yourself well through these channels is important. Getting help from someone with a black belt in LinkedIn tech recruitment can be beneficial, as is using an adviser or mentor to help with the initial key hires.
As you scale, it’s vital to cultivate and nurture your team, be open and sharing – they will surprise and delight you.
‘“If you build it, they will come”, is just a line from a Hollywood movie. It’s not applicable to any start-up I’ve ever come across’
What is the critical ingredient to start-up success?
A start-up team should be asking itself some key questions from the outset.
At this point in time, have we:
- a clearly identifiable addressable market with a convincing or emerging need?
- a sustainable competitive advantage?
- properly validated our solution with potential customers?
- a business proposition that’s scalable?
- what it takes to generate sales and build operations that can support our growth strategy?
- most importantly, a team with the skill sets to bring our product to market?
You can achieve real focus, momentum, and save valuable time and resources if you answer these honestly and then take whatever action is required. It will also make your start-up more investable.
What are the biggest mistakes that founders make?
Founders don’t consider the wider management piece early enough. They can also be overly paranoid about dilution and functional control. As a result, they can fail or choose not to listen to advice or get help until it’s too late.
The start-up scene is littered with mothballed ideas and ex-founders who blindly believed their own hype and overestimated their capabilities – that all that was required was to create the product.
Well, “If you build it, they will come”, is just a line from a Hollywood movie. It’s not applicable to any start-up I’ve ever come across. Your product can be as groundbreaking or disruptive as you wish but unless you have good people in place to commercially execute, you are doomed to failure.
A few years ago, I was working with a promising start-up and arranged to provide investment to build an MVP for them. Issues arose around complementing the founder skill sets with an experienced commercial operator. One of the founders believed that they could take on this role.
The investment didn’t proceed, the founders persevered and tried to bootstrap but 12 months later, the company was gone. Opportunity doesn’t wait around.
Who is your business hero?
I don’t really have business heroes. My biggest influencers have been many of the fantastic people that I’ve had the privilege to work with and learn from.
What’s the number-one piece of advice you have for entrepreneurs?
There is a reason why successful companies dominate their markets: they understand customer value.
The value proposition is often misunderstood by start-ups. Peter Drucker said that “the customer rarely buys what the company thinks it sells”.
Find out what are the ultimate value benefits your product gives to your customers, then shape everything else around this. Get the value piece right and you are far more likely to succeed.
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