That thing called Startup Funding

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So, one of the big differences I’ve noticed between the startup scene in Dublin and the one I was weaned on in New York is around this thing called funding. Early stage funding (up to amounts of 50K) is relatively plentiful here in Dublin, thanks mainly to local and national government supports.

Instead of emptying bank accounts, running up credit cards or tapping relatives with a few bob, entrepreneurs here can apply for funding to take their startups through those early stages of development, from concept to MVP and beyond.

This approach may benefit the entrepreneur’s pocket but I’m wondering how it ultimately impacts their businesses, and the startup ecosystem here in Dublin. Clyde Hutchinson, an expert on the Israeli scene, says that Israeli companies tend to be leaner than Irish ones and quicker to deliver a product because seed funding is so hard to get and they’ve no cash. Sounds like New York to me.

DC Cahalane, one of my advisory board members (and favourite person from Cork’s impressive startup scene) also suggests that one reason our angel community is so small in Ireland is because there’s less of a need for early stage “friends and family” funding. Again, this resonates even if we don’t have the data to prove it.

Last night at a Bell Labs startup event, one of the company executives introduced himself by saying that he comes from an era “when startups had products and customers, even if they didn’t have revenue”. The remark made me wonder whether early stage companies are being taken seriously enough, and whether they always deserve to be.

When I meet startups in Dublin I ask them how much of their own money they’ve invested and where they want their businesses to be in 3 years time. I never took funding for either of my startups in New York. Not because I didn’t want it; I  just preferred to keep building and selling than give away early equity at a lower valuation.

We all have our own stories to tell and Dublin’s great story is just starting!

 

Startup Envy

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I had a call this week with The Coalition for a Digital Economy (Coadec) a policy lobbying organization for the startup industry in the UK. Large tech companies and startups have come together through Coadec to lobby government on important issues like connectivity, digital skills, net neutrality, regulations around innovation and immigration rules for highly skilled workers.

Coadec has brought out a Manifesto of 24 key asks and it’s no surprise that number one on the list is to keep SEIS and EIS tax reliefs for startup investors. These UK tax rules, offering ease of investment and downside protection, are critical to the success story that is Tech City and now TechUK. Since 2012, 1,600 companies have raised more than £135 million through SEIS and 58% of investors say they would never have invested without it. We’ve no downside protection for investors here in Ireland, but we are working hard to offer them a more conducive pro-investor environment.

But, what fascinated me most about the discussion with Coadec Executive Director Guy Levin was not his great manifesto but his insight into why the multinationals work so closely with the startup community to lobby government. The multinationals need the startups on their side he explained: “because they’re the sexier voice of the community”.

What? I said. Startups are “sexier” to the government than multinationals?? I was shamrock green with envy.

In mid February we’re bringing together all of the policy stakeholders across the Dublin startup ecosystem to explore how to present a stronger and louder case for the sector to the Irish government. We may well end up with our own manifesto but, no matter what, we’ll probably still be a long way from sexy.  We’ll get that done another day.

This is Big- The Startup Events Board

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On February 5th over 70 startup event organizers will come together in Dublin for beer, pizza and to agree the calendar of startup events for the city for the next 6 months. As the organizer @RussellBanks77 describes it on Eventbrite:

“There are now nearly 100 regular events in Dublin spanning, tech, design, and entrepreneurship. We want to start shining a big light on Dublin, our events and our great community of organizers. By sharing what each of us is doing with our own communities we’ll make the overall Dublin community stronger”.

I’m super excited to be there and to watch this collaboration unfold firsthand. Our competitive advantage as a great tech hub depends on our ability to connect and work more effectively with each other. Please join us and help make that happen.

We’ll launch the Dublin Startup Community Fund (modeled on the Colorado Fund) on the night also so that event organizers old and new can apply for the funding they need to keep Dublin’s startup community moving and innovating.

This is Big. Feb 5th is going to be one of the highlights of my year. I can already feel it.

 

 

 

 

The Odd One Out

I was delighted to speak at the Department of Foreign Affairs and Trade’s panel on the Irish Diaspora yesterday at Dublin Castle. It was the first time since 2011 that Ireland’s Ambassadors and Consul Generals gathered together in Dublin and they were an enthusiastic audience. The conversation centered around the strength of our diaspora, the respect our ambassadorial missions enjoy overseas, and the affinity non-Irish people feel for our culture and music, and for perhaps our greatest institution of all, the GAA. Paraic Duffy gave Muirne Laffan and her team at RTE Digital credit for the 100+ GAA games people of Irish persuasion from across the world will be able to tune into during 2015.

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Talking diaspora and tech startups in the same breath definitely made my speech the odd one out on the day but I think it was well received. I told the audience that the global Irish are incredibly important to our startups here at home and not just in terms of funding and opening doors to customers. They also give us that psychological push forward, that message that says “you can succeed, you can go global” and there’s nothing like a mentor or two to help you scale that mountain.

So, one of my major areas of focus for 2015 is around diaspora and the many ways our startup community can connect and leverage the global Irish to their benefit. Imagine, there are 50,000 Irish company directors in the UK alone.

With the support of Minister Deenihan and his team, our diplomatic missions globally, networking companies like LinkedIn and on-the-ground organisations like the Digital Irish in New York, the timing is perfect to start connecting the dots across the globe for great Irish startups.

The Year of Connected Thinking

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On Friday last January 9th, I completed 100 days as Dublin’s first Commissioner for Startups. It’s been an exciting start to this two-year role and I’ve been thrilled by the quality of startups I see in Dublin and the depth of the ecosystem that has already built up around them.

My big theme for 2015 is Connectivity and we’ll be supporting a number of projects that help our companies connect more easily to global markets and help international talent, expertise and investors connect to Dublin (more on these in follow-up posts).

But the real connectivity challenge I see for Dublin is local, not international. We are a modern city of tribes where startup initiatives are more stand alone than connected, more versions than evolutions, more once offs than steps in a process. As a result, Dublin feels small, to us and to others.

I’m not saying anything new here. The Activating Dublin report, which prompted my appointment, highlighted “silos” as a key issue for Dublin as far back as August 2013. A big part of my role is to develop a unified vision, message and platform for Dublin as a great startup city, but marketing by itself won’t get us very far. We need to start to reach out, ask questions, share knowledge and really collaborate with one another to get attention.

In early February, the Dublin Chamber of Commerce will host a meeting of the “tribes” to explore common language around legal and tax policy issues for startups. My office is also convening diverse stakeholders to see how working together can resolve the urgent issue of affordable office space in the city, and the wonderfully indefatigable Russell Banks will bring all community event organizers together at Wayra on February 5th to agree a definitive 6-month calendar for the city that we can all get behind and support.

We’re also going live with the Dublin Data Initiative this month and over the next two weeks we’ll be asking our banks and service providers, accelerators and universities, multinationals, trade associations, VCs and government agencies to share their startup data with us, and our partner in the project, Startup Genome. After the first cut, there’ll be a dinner where volunteers from across the city will sit together and make the kind of revisions to the list that only a community that cares could make.

There are already many award events for the startup and tech community in Dublin but we may need another one that celebrates collaboration and joined-up thinking across people, organizations and startup processes in the city. Maybe we could even persuade that Dublin based sharing economy company we all love, AirBnB, to sponsor it.

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