Digital Mission Blog
The Digital Mission series is run by Chinwag to support UK-based digital companies expand into new markets and attract overseas investment.
What Makes New York's Digital Investors Tick? The Digital Mission to New York Found Out.
A short pause for breath in the Digital Mission activities provides an opportunity to blog about the investor breakfast yesterday morning. It was organised in conjunction with The Hatchery and UKTI at the very digital Roger Smith Hotel - more on that in a moment.
The companies and investors mingled over breakfast, then both groups gave a short introduction before we dived into a roundtable Q & A session. I was struck by how frank the investors were. I've been dealing with VCs for more than a decade, and it was one of the most open exchanges I've seen, and with a broad range of investor types too. There were lots of sound bites and snippets, I'll share a few...
- Investors want prudent operators - the words 'risk management' came up multiple times.
- They want business leaders who are accountable - VCs themselves are intermediaries between their own investors and companies they invest in. They have to give an account of what goes on too.
- Most US investors want a business that will be a leader in their space, but make sure you choose a meaningful space. To be the leader in the digital marketing world in 3 years is over reaching, but saying that you will be the leading provider of payment solutions to east coast businesses is more meaningful. Not every investment will be the next Google, nor does it have to be.
- Investors will want involvement in the business - although some will be much more hands on that others. Understand their style. Will it work for you?
- Generally they will want to meet any key business hires - They may help with suggestions for candidates, but if you are using your investors as recruitment consultants, you're doing it wrong!
- Distance is (still) an issue - for a UK business that means having a management team in the US, a VC with a UK presence, or investors that are happy to work across timezones.
Mark, of Ipadio, makes some interesting observations in his phonecast after the meeting:
Investors generally buy into a management team, rather than an idea, so they will want to know you and know how you will interact well with them. It just so happens that there is a related post on TechCrunch - The Eight Best Questions We Got While Raising Venture Capital - which you might want to cast your eyes over too.
One last thing, something learnt via a painful lesson early in my career and a point well made during the morning: Keep all of your investors in the loop, all of the time. Which leads to one of two stand-out quotes of the morning, for me at least:
"Investors love good news, they can handle bad news, but they hate surprises."
With the Q & A over, the room broke into some more informal networking, with lots of conversations around the (rather nice) room. As the hotel was mentioned in the key note at Web 2.0 Expo the day before, I was keen to find out more about them. It just so happened that James Knowles, CEO and artist-in-residence (yes, you did read that right), dropped in to meet the companies. That lead to some interesting discussions on entrepreneurship, leadership and marketing. As you can probably guess from his title, it isn't a conventional hotel business! Which leads me to that second quote, this time from James:
"20 conversations a day is better than 1 weekly meeting."
We're back there today for lunch...
In the Big Apple, Digital Mission Companies Have Plenty To Shout About
The Digital Mission to New York are ensconced in the Big Apple's frenetic networking scene making contacts and wrapping their heads around the US market.
Contacts are being made, meetings followed up and progress made in building overseas partners, trade and investment for some of the best the UK digital sector has to offer.
But things don't go quiet just because they're out of the country...
Stylesignal are Sifting Fashion's Social Sentiment
Possibly the newest launch amongst the Digital Mission companies, Stylesignal launched their Trend Science subscription service just days before heading over to New York.
The culmination of two year's work, the product analyses opinions across the social media sphere including Twitter, Facebook, blogs and press, tool automatically understanding consumers sentiments displaying their longings and loathings by geography as well as garment types, prints, patterns, colours and details.
Want to know whether Katie Price is in or out? [Ed - we shudder to think] There's a graph for that. Presenting complex data sets in easily digestible graphs can only be a good thing for hard-pressed marketer and PRs. And yes, before you ask, Geoff and Julia from Stylesignal are raising the satorial bar amongst the mission party.
Collecting Toys is a Serious Business
Martingale Internet Technologies' Toycollector.com community is on track to be the leading resource for the serious collector.
The company has recently boosted its advisory board with three of the world's leading collectors including toy soldier and figure expert Norman Joplin, leading robot and space toy consultant and dealer and Chang Yang Fa whose own 100,000 piece collection is so vast he's only able to display 5,000 pieces in one go in his dedicated seven-story MINT museum.
Understanding the basics of the market, I'm now wishing I'd been a lot more careful with some of my classic toys I ended up burying in the garden.
Green Card for Business and a Red Card for Google
Web 2.0 Expo is in full flow. Yesterday the Digital Mission companies had the opportunity to check out the talks and keynotes.
It was an interesting tone, as Mr Web 2.0 himself, Tim O'Reilly took to the stage to give a speech that was both a 'state of the web' address and a challenge to Google: Would they persue an open web or would they take the path of "one ring to rule them all," producing increasingly closed systems.
Tim O'Reilly
Google's recent announcement of turn-by-turn directions and speech recognition services are a head-on challenge to very large and established industry players. We take the openness of the web for granted, but Tim was quick to point out that it is far from a given.
Facebook's recent URL stripping of Twitter status messages entering the platform caused a bit of a story. Apparently it was a system bug, but it was taken as a sign closing the platform, locking out potential competitors. Of course they still have their "you are entering the big-bad-scary web" warning messages each time you click on an external link. Again, something that might be down to an over enthusiastic legal team rather than an intent to frighten people into staying on their platform.
"Do the right thing. You will gratify some people and astonish the rest." - Mark Twain
"Data is the Intel Inside" of the Internet, but Tim feels that instead of the Internet as a platform, we may be entering an era of Microsoft as a platform, Google as a platform, etc… as services like Azure and Google Apps create separate data ecosystems. Web businesses would be wise to keep a sharp eye on these dynamics.
There is a big difference between a loose affiliation of web-based services ("small pieces, loosely joined" as Tim put it) and a battle of "one ring to rule them all" systems that attempt to lock users in with a cheaper-than-free model.
The phrase left ringing in my head after Tim's keynote was the Jeff Jarvis quote: "Do what you do best. Link to the rest." - Wise advice for journalists and web-businesses alike.
Kevin Rose and Jay Adelson, Digg.com
After Tim, there was a fire-side chat with Kevin Rose and Jay Adelson of Digg. They are clearly focussed on growing the platform, and I couldn't sensing that they feared being stuck as a mid-size player. Digg is no slouch, with tens of thousands of contributions each day and millions of hits, but the human-recommended-web is a highly competitive space, with new entrants every day.
The conversation was full of advice for entrepreneurs. Kevin and Jay see now as an easier time to start. Costs are lower, and development platforms have become more accessible both in functionality and in price. Kevin repeated the Web 2.0 mantra - "release early, release often. iterate as fast as possible." - the strategy for rapidly moving market places.
Chris Brogan, New Marketing Labs
Chris Brogan's speech challenged people to think more socially about their business. His main advice - "How do we share?" Ask that question a lot, he urged, in social media, listen, more than you worry about what to say. "How do we develop relationships that yield?" - customer interaction is changing, especially on the web - communities are a powerful structure, but audiences and communities are different, and require different strategies not just a different tone of voice.
"the difference between an audience and a community is which way you turn their chairs"
Caterina Fake, Hunch
Talking to the Digital Mission companies afterwards, Caterina Fake came across as the highlight of the day. Her battle story, as co-founder of legendary photo-sharing site Flickr, was quite inspiring. Flickr apparently came out of a failure - it was a business that set out to do one thing, ran out of money and then did Flickr instead - 90% of the features were built by 6 developers. Their model of incredible complexity made to look amazingly simple, is one that crowned them king of the photo-sharing space - leading to their acquisition by Yahoo!.
Caterina now has a new start up, Hunch, which takes that same theme of making it easy for lots of people to contribute little things that combine to make something big, beautiful and almost magical. Yes, I'm a bit of a Flickr fan-boy too.
Danah Boyde, Microsoft
Danah Boyde, now of Microsoft, unintentionally gave a dual path demonstration of the power of information flow. She appeared slightly tired and nervous as she took to the stage, and as she talked the Twitter stream on the huge screen behind her became increasingly snarky - even by British standards. "Slow down and take a breath" the tweets urged, but of course she couldn't see them, as she read from her notes.
The text of her talk is here - It is a good one, and if you are interested in understanding what social media is doing to people and society, it is a must read. However, Danah's academic style and rapid delivery isn't something that can be digested whilst simultaneously tweeting and reading the back channel. When the screen was temporarily switched off, the atmosphere in that huge auditorium completely changed. At least for a few moments, until it came back on. "We are moving from broadcast media to networked media" said Danah, and it would appear that we are in the child-like stage of this new world.
While some of the digital mission companies took the chance to recuperate, others headed across town for meetings with prospects and potential partners. Because of the number of events in New York this week, it seems that almost everyone from the digital industry is in town.
These are interesting times. Web 2.0 Expo and the digital mission last year coincided with the collapse of Lehman Brothers, and while the big banks on this side of the pond are paying back the government money that bailed them out, there is still the feeling of an economy that is in the process of being rebuilt. As Caterina Fake said in her interview, now really is the best time to be starting a business here.
Texas anyone? Applications for Digital Mission to South by South West interactive Closing Soon
Digital Mission to SXSWi is back for it's second year after the success of the mission to Austin in March 2009.
The mission to SXSWi is a great opportunity to take advantage of the publicity and profile from a group of British companies attending SXSWi.
The applications for the mission are open until Fri 4th December. The form is pretty painless and shouldn't take more than 20 mins to complete. There's also lots more info about the application criteria on the Digital Mission website.
Plus, there's a melange of features to help develop relationships/partnerships with US companies, look into opening an office stateside and make valuable contacts for the future - not to mention brushing up on your industry knowledge.
Digital Mission provides an opportunity for companies to expand their business or seek investment overseas, organised by Chinwag and the UK Trade & Investment (UKTI). Each Digital Mission has a range of activities planned with UKTI's network of consulates, sector experts and local contacts.
South by South West interactive (SXSWi) takes place in Austin, Texas from 12-16th March 2009 and applications are now open until Friday, 27th November. The festival features five days of compelling presentations from the brightest minds in emerging technology, scores of exciting networking events hosted by industry leaders and an unbeatable line up of special programs showcasing the best new websites, video games and startup ideas the community has to offer.
Applications for the mission are open to UK-based, SMEs operating in the digital sector through a competitive selection process. Successful companies are judged by Digital Mission advisory board, comprising experts from across the digital industry and UKTI sector specialists.
Applications are now open until Friday, 4th December
You can keep up to date with Digital Mission news by signing up to the newsletter or following @digitalmission on Twitter.
Digital Mission to New York Master Class - Legal and Experienced
The Digital Mission companies have arrived in New York and are well into the first day's activities, which kicked off with the Master Class session at Winston & Strawn's offices.
It's amazing to think that a year has passed since the previous Digital Mission to New York, but the view across New York from the Met Life Building brought the memories back. New York is a unique city, with a very distinctive vibe and culture. Doing business here is both challenging and exhilarating.
The panels were a pleasant mix of new and familiar faces, kicking off with the basics of setting up in the US, including dealing with general legal issues, employment law, Intellectual property and tax. You might be a UK business, but US courts can claim jurisdiction over you. The US legal systems operates at a state level, which raises the spectre of 50 different courts reaching their long-arms out to you.
Like the UK, there are different legal structures for a growing business, from the start-up friendly LLC model to the full "Inc." corporation. The Winston & Strawn team talked through the pro's and con's of each, and the challenges of meeting the SEC's requirements when it comes to raising capital. SEC registration can be a long process and requires extensive public disclosure, but there are exclusions if you do things the right way. Clearly an area where good, professional legal advice is required.
The panel sessions and talks were packed with useful advice, from the wisdom of getting multiple points of reference for contacts and information, to really knowing your market well. Good advice anywhere, but all the more important when you are entering a new market. Referencing is essential - people want to talk to others that have done business with you - so building a good network is one of the key foundations to building a successful business in the US.
Toby Daniels told his "stories from the trenches" based on his own experiences of setting up in the US. His top tips for getting started:
- Be present - get to as many events as you can! [but know which to focus in on]
- Know who the connectors and community organisers are - get to know them.
- Give back, contribute - as well as being personally fulfilling, it is great for your brand.
- Do everything you can to rise yourself above the parapet - don't just be a passive observer. Look to create value and rise above the noise.
And with that advice ringing in their ears, the Digital Mission companies networked over lunch, before readying themselves for the invite-only Consulate Reception, where they will spend the evening networking with key players from New York's digital scene.
