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An Excellent Idea For A Start-up! (Part 1)

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Excellent Idea

It has been a while since my last blog post, but in IT business a lot happens at beginning of the year which has kept me particularly busy. I would like to dedicate my next two posts to the subject of an “Idea” and the importance of the idea behind start-ups.

Whilst acting as an entrepreneur, I have engaged in constructive discussions with young entrepreneurs and some students who are planning their own start-ups. In most cases, I felt that young entrepreneurs do not focus on the idea or about the importance of the idea. This causes them to ignore the time they should spend to think and evaluate the value of the product or service they plan to deliver.

I found that these sorts of people tend to rush the start-up and gain success in a silver plate. Rushing to start-up may not be a bad idea, because things evolve and the world changes continuously, and in all honesty a good execution has extremely more value than a good idea. However, I believe it is clear that a bad idea is still a bad idea. Even the greatest execution will not get start-ups anywhere. Nonetheless, there are some minimal exceptions, but most successful companies have initially started up with a good “Idea”.

So, what can the Idea be described as and is it only reflective of the product or the service that one wishes to start-up?

In fact, most people seem to think that the idea is derived from being able to answer: “What do we want to provide to the customer”.  However, the definition of an idea is much wider than answering these sorts of questions. The definition of an idea includes the size and growth of the market, the growth strategy for the company and the defence strategy of the company against competitors.

During the idea evaluation, the founder should go through all facts and evaluate the quality of the chosen idea. As mentioned in my previous posts, it takes at least 10 years to shape a successful company. Therefore, it is really worth sitting back and taking enough time to think about the long term goals in order to add value to the business. This would then allow you to build on defending the business at depression. It is almost impossible to plan everything in advance and the start-up should be as agile as possible, and planning beforehand may become worthless at some point, but the practice of the planning has a grand value for the future. In most start-ups there is a lack of long term panning but if you have it, you will possess great advantages in the future.

The idea of my start-up currently known as Digital Illustrated was born during my last year as an employee. I was unsatisfied with the way the company was lead and the strategy in which the projects were managed. Repeated management errors occurred during my career and at the same time, the IT business was transforming.

Moreover, the term “cloud computing” was still unknown to most people and Microsoft lunched the first version of Office 365 (known as BPOS back then). Therefore the Idea I came up with was: Create an agile company in Microsoft’s ecosystem and go “Cloud”. The defence strategy was to generate and provide services with extremely high quality that makes end users and employees extremely satisfied. The idea was not the most unique one, but this was a new born market on its way and a gap to for us to fill. I intend to go into further detail about the relationship between the “market” and the “idea” in the second part of my blog post.

To wrap-up the first blog post about how to have a new idea for a start-up, here are some issues I advise you to keep in mind:

  • The idea always expands and you will become more ambitious as the journey of your start-up goes on,
  • You don’t need to plan everything from A-Z, but it is good to have a plan to start with,
  • The idea should always come first and then you should go for the start-up,
  • You should wait until you have the perfect “idea”. It is important as you should aim to choose between good and bad ideas;
  • If you have multiple good ideas and you want to choose the best one, take the one which you have mostly in mind during your free time (most of the founders regret the fact that they started the company without the idea they loved).
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To Be Or Not To Be A Startupper

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Back days during my university studies, I was always wondering what is the source  of multi-billion dollar/euro enterprises. How can you create such a company, and what do you need to be able to run the company. There are still many people, who are thinking about the same questions and trying to seek the answer.

Let me make the answer easy to understand. Any living object in this world has a start. Even our world had its own start during the big bang process. Companies are established for different reasons, but Start-up is a different and unique type of creation model. Most of the times I compare companies to humans, so I would compare a start-up to a just born baby. To evaluate yourself and to see if you are ready to create a start-up ask the following questions from yourself and compare your answers to mine. Then it is much easier to have a start.

Why you should not create a startup?

  • You have heard about a successful company, and you just want to have a try with the same idea to see maybe you will be successful. Don’t you even bother yourself! If the existing company is making a fortune with the idea, they have already used the opportunity and they will be always a step ahead!
  • The $/€ signs are in your eyes and you want to become rich really fast. That is the worst reason to become an entrepreneur and establish a start-up. There are so many other ways to become rich with less effort and responsibilities.
  • You are a control freak and you want to keep the power in your hands. A startup is a wrong choice for you, and maybe a bigger and more traditional company is the place you can show your power to the stuff.
  • If you are running from the responsibilities and trying to pass everything as fast and easy as you can, forget to becoming an entrepreneur.
  • Negativity and laziness does not fit in the life of an entrepreneur, and I guess you wouldn’t be reading this blog post if you were belonging to those group of people.
  • The idea of becoming an entrepreneur and creating a startup might cross your mind, because you are talented and experienced business person. BUT you have a golden cage around you (a good job, position & salary, with bonuses which generates consistent income). The golden cage makes you too  scared to lose everything, and not to achieve them again.  With the cage around, you will not dare to give a try and create the startup.

You should only establish a startup if you feel that there is a problem and the best way to solve the problem is to create a company. What you need for the establishment is the passion and the love for the thing you are creating. You should be absolutely ready to become the parent of the new born child which is the company.

Why did I do it?

  • As I have told in my previous blog posts, that I am from an entrepreneur family. As a child I saw how my dad created a company from 0 and built a successful enterprise.
  • I already created once a company which failed. I hate to fail and failing gives me new ideas and motivation. But the most important thing is that I’m not scared from failing and I try to learn from my mistakes.
  • I worked for the big and mid-size companies with the experience of different processes and failures in the companies. I noticed the reasons, why they were failing. Unfortunately most of the companies never learn from their mistakes nor try to solve their problems.
  • I was wondering why I’m doing this for them and not creating my own, with the better and agile way of doing the business.
  • There was a gap in Finnish ICT market and the gap needed to be filled with the startup I was going to create.
  • The market was not mature enough and the big size clients were too scared to buy from small companies. But I guess if the market was mature enough, there would not be a place for Digital Illustrated at that time.
  • I found out that few of my ex-colleagues became an entrepreneur. That gave me more courage to leave the golden cage and create the startup.
  • I love to be challenged and use my innovation to solve up-coming problems.
  • The last but not least is my love and passion for the IT/ICT business. The idea to create something new and unique makes me extremely happy!

Always remember the highlight:

Before becoming an entrepreneur and creating a startup, first evaluate yourself carefully. After the evaluation, think about the problem the start-up should solve. If you still have enough passion and love to do it, then you are ready to go and face the reality.

The road is long with lot of barriers, but the more you travel the more you will love it. Most of the entrepreneurs who I know, and who has created an startup have said “They couldn’t imagine at the beginning how hard creating a startup could be!”. One of the most important thing to keep in mind is that, if you go for it, be ready to spend 7 to 10 years of your life rising your “child”.

The rewards and the experience you will gain will be so great that you will never even thing to become an employee again and work for someone else!

 

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Follow, Believe and Take Over

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In my last two posts I had a review of the history of my entrepreneurship and the experience in a large corporation. In this blog post I will have a review of my transfer to a smaller company and the revoke of the belief to entrepreneurship. This will be my last blog post about the history and from the next post I will concentrate on entrepreneurship and the creation of startups.

Here is again a quote from Jack Ma (the founder of alibaba.com)

Before 30 years old go to small company. In a small company you will learn about the passion and dream. You will learn about many things what you can do at the same time. It’s not about which company you go, but which boss you follow (it’s very important).

During my Master studies the university offered a course about new digital ecosystems. The content of the course reviewed companies from the Silicon Valley and discussed about the creation and earning models of each company. At that time I still was working for the Tieto Corporation, with no intent to become an entrepreneur in the near feature. The course actually created an idea to have a change in my business life. I already had an experience from a large international company so it was a time to change to mid-size local company. After sending an application to few companies and few interviews I decided to join a company called Endero. The company was acquired by an Scandinavian company called Know IT few months after my entry.

I still remember the day, when I met one of my best friends and business partner, in my first interview at Endero. Petri Säkkinen was the team leader of the Digital business unit and became my boss at that time. He stretched out his business card and told me “We will meet in the next interview, if you get a mutual understanding with us”. Some times in your life you meet people by accident and you have no idea that the person can be become your best friend and you can build a success story which will change your lives. I guess Petri was the boss which I had to follow, but instead I shared my ideas with him and later we built a new company together.

I always knew that I have skills in sales. In my old life at Tieto I never got the opportunity to be part of the sales team and show my skills even in the pre-sales phase. Moving to the smaller company opened so many doors and new opportunities in my career. I was able to join the sales and improve my skills and learn about the sales  pipelines and marketing. As mentioned in my first blog post the technical line of the Finnish universities does not teach much about the sales and marketing. The real life business is the place you will learn about these subject if you have the passion and the interest. Actually if you become an entrepreneur you have no other choices!

After the acquisition of Endero, the buyer company made some changes to the enterprise. Few managers left the company and Petri decided to leave and create a startup in the Silicon Valley. That was a decisive point for me too, because I had no more links in the company which made me to stay. When I found out an ex co-worker created his own company I just had to do something about my passion and create my own startup. I will get to this story later in future posts. My career lasted at Endero/Know IT exactly one year and from 1.2.2011 my new employer was my own company.

Here are the highlights and some facts I learned from a smaller company:

  • You get more power and responsibilities
  • The responsibility makes you to think differently and outside of the box
  • You will learn much more from business and running a business
  • You have the voice to influence in the business
  • The personal communication skills will get improved
  • You are not a part of a big machine so you have to find your way more by your self
  • It is easier to leave a smaller company and creating your own comparing to a leave from a bigger company

 

 

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Begin A Part Of A Big Machine

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I was watching a video clip from the founder of Alibaba.com jack Ma who is the richest man in China these days. He said:

As young guy and before 30’s follow somebody. In a big company it is good to learn about processes and you are a part of big machine.

In this blog post I’ll go through how I ended up to Tieto Corporation and few words about the unit I was working for. The post will give good reasons why did I changed later to smaller and more agile company.

My professional career after the studies started in spring 2007 at TietoEnator corporation. The company changed the name to Tieto few years later and still working with the same brand. I started as a Software Engineer working with the .NET technologies and products built on Microsoft’s technology stack. Most of the large corporations and the public sector publishes news and corporate contents to employees using Content Management Systems (CMS). My experiences with CMS products started with SharePoint 2003 and Elevation. Elevation was a in-house built CMS product.

Few years before I joined Tieto, the company acquired a corporation named Visual Systems (VS) and the  unit I joined was a trail from this company. Visual Systems was founded by Pekka Viljakainen, who is a long line entrepreneur and business man. I was told that, the business idea of the company at the beginning was to create educational videos for schools and academic institutions. As the internet became more popular and companies started to provide services over the internet. At that point Visual System changed the business focus and started to create digital services for large corporations. For example the first Finnish internet bank service which was made for OP Bank was produced by Visual Systems.

If I should describe Tieto Corporation and find a synonym for it I would say a large whale. The corporation history and the way it was managed made it really hard to change the course and exploit talent inside the house. Everything is decided for you and there are so many hierarchical levels and bureaucracy, that new ideas does not fit in the daily business and the company makes a slow death.

Visual Systems managed to built a great corporate culture in where every one felt their value. All the employees were friends to each other and with the in-house events and brighten up and innovative projects the company managed to keep the growth and eventually owners sold the company (made the exit). The inherited culture was obviously different than other organization units at Tieto. One of the biggest mistakes Tieto did, was not to adopt the culture inherited form VS to other units and learn from the better one. Instead the management tried to bring the rigid and old-fashioned way of doing IT business to the young and innovative section of the corporation. This mistake eventually scattered the unit and almost all of the talented professionals left the house.

As I joined the organization as a junior professional everything was new to me. The business model, the earning models, the sales focuses, the organization model, employee roles, project models, the technology and so many other pieces, on which the IT and ICT business is built on. Curiosity plays a big role in my personality. From the moment I settled down in the company I started to research the business and asked question from high level managers. One of the most question I asked always was “How much they are paying?”. I guess this question comes from my background, because we Persians always love to know the price.

During the three and half years my main focus was on the technology, but during the period I tried to build as many direct customer relationships as i could. But in the most big IT & ICT companies you are just a resource in few projects. The managers reports only numbers to the higher levels and talents are not used as they should be used. In the big company your role is to create certain amount of income as it is planned for your role and most of the this are dictated and sold to with a beautiful story. Instead of re-evaluation of roles and talents, employees are kept in the same panel as long as it’s possible and the only way to improve and progress in your career is to change the company. There are many people who are contented with the dictation and in most of the time the only way they leave the company is to retire, get a better job offer from a similar company with a greater wage through a recruiter or last but not least to be fired (to get fired in Finland is extremely hard because of labor union power).

At the end of the day the experience I gained from the company was great. Here are some highlights from my experiences:

  • As a part of big company you will learn about processes
  • If you are new to the business, I bet a big company is a good place to start your career
  • More and less you are a resource and your only job is to make more income for the house
  • Big companies are really slow to change orientations
  • If your intention is not to retire soon, don’t stay too long in the big company
  • Make as much connection as you can even you are not at the highest rank in the organization chart
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The Big Bang of My Entrepreneurship

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They say history matters, and they are right. Here is the story of my wonderful failure and the first startup I created more than 14 years ago.

It was beginning of the millennium and the web/browser based games started to become more general. I was hooked with a game called Planetarion. The game was browser-based massively multiplayer online game and the idea was to build, develop create an army and destroy the enemy (Like all other strategy games). Planetarion story is based on space and SCIFI. I’m a big fan of Blizzard games and since 90’s I have been playing World Craft games. This gave me an idea to create a Massively Multiplayer Online Role-Playing Game (MMORPG) like Age Of Empires or Warcraft.

The passion to create the game and make the dream come true took all my attention. Beside of reading for the matriculation examinations and the entrance exams for universities I started to create the game. With no business plan, earning model nor capital, the only goal I had was to create the game. Later the game was named as Emperatur which means “The Emperor” in Persian.
Soon after I noticed that the game needs a good graphics to attract players. The background I had was from the technical side with no skills of drawing nor 3D modeling. Back then IRC was the communication and chat channel to get new friends and socialize in the internet. I started to look for 3Ds Max and Lightwave 3D artists. The funny and the strange part of the story is that I managed to find some few friends who started to make graphics for the game and for free.

As I started my engineering studies in the EVETK University of applied sciences, I asked some resources and hardware from the head of the department and she provided me a storage which I changed it to an office and some old computers which became the hosting server of the game. Soon after I was introduced to a professor with whom we started to think about the business model and marketing strategies. He also provided me some connections for example to Vesa-Matti Paananen (Vesku) who was an entrepreneur at that time and big name in the mobile world. Currently he is working for Microsoft as the Windows Consumer Product Marketing Manager.

One of the problems I met during my startup at the technical university was lack of business skills and knowledge. If I had the time machine to go back and change something I would definitely go to the business department of the university and started to find people with the entrepreneur spirit and also with business and marketing skills. Actually during my second startup I took advantage of my experiences from the first one and grouped up with my current business partners who completes me in skill which were missing from my skills set.
The game got to a stage that could had been a published to the web and I started to look for sponsors with my mentor (Vesku) using his connections. The only sales meeting we had was with the Finnish phone operator DNA, which got in to the pause mode because of the summer vacations and later lack of contact made that sales opportunity the only one and the game never got published to the web with a sponsor.

Currently games like Clash Of Clans of Super Cell is the complete version of what I was trying to do. The success of the game is the right timing for the game and the ecosystems provided by Apple and Google which makes the earning model in a class of its own. Back then the mobile devices were not in the current stage not to mention the internet connections in mobile devices.

Here are lesson learned from the startup #1:

  • Technical skills are not enough to create a startup
  • You need a good team to operate with, try to find people with good spirit to help you
  • It’s all about sales, marketing and connections
  • Write down your business plan, make a market research and build the earning model before doing anything else
  • Right timing of the service or product is one of the most important factors
  • Try to finish the product as soon as you can, so you can get experiences from the users and the market
  • During the studies and university life there are more time and good people around you. Try to take advantage of that!
  • If you fail it’s not end of the word, lift your head up and move forward
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