John Tracey, Gerry Murphy, Aislinn Rice, Ian Murphy, Hal Wilson
Gerry: There is no difference between the domestic and global market. There are no walls anymore. Competition will come to you.
200 companies control 80% of world trade. You have to operate globally to supply these companies.
Ian: Certain segments can scale up. Allan McClay is unique in that he has invested all of his money back into the NI economy.
John: Can we compete? How should we organise ourselves? (People, market opportunity, product) Key element of competitiveness is domain knowledge. Fitness for purpose is key. e.g. Apple Computers are focused on ease-of-use.
Hal: More second/third generation entrepreneurs in Dublin than NI. Can we build businesses of scale, are entrepreneurs ambitious enough? Do we lack confidence? Need to show Irish entrepreneurs they can beat the world, but exposing them to the competition.
Aislinn: Need to develop sales and marketing expertise to expand to a global footprint. 96% of revenues come from overseas. Sales model based on a mix of direct/indirect. We have worked with a Chinese distributor for the past 5 years. He now runs the Andor Chinese office. Andor is a component of larger systems, therefore we need excellent partnerships. Andor growth is 30% year on year.
John: (Q: How do combat copying of ideas?) The type of technology that comes out of Ireland is complex and in the case of software the price tag is around 300k. By building in domain knowledge you make the product defensible. Product architecture and design lives at home. We prefer near shoring (eastern Europe) to Asia/India. In Indian your staff turnover is probably 40% and there are timezone issues.
Hal: If you are bulking up by acquisition then you need the skills to manage that process. NI not there yet.
Ian: I’d be much more optimistic. There are examples here already (Sean Quinn, Allan McClay). The Island economy forces us to move overseas very rapidly. There are successes and failures (SBP: One sold for 10m, another went into receivership).
Gerry: Job losses in Ireland are mainly in the multi-national sector. No such losses in domestic sector. We need to look inside companies to see the problems. Startup rates are very good in Ireland. We less successful at scaling businesses (e.g. the ability to make acquisitions). Business models are often inappropriate (no recurring revenue, not a repeatable business or service). Companies try to go it alone, need to use partners to scale. They need proper organisational structure as they grow (board and management).
Ian: Very expensive for Bio companies to sell in the US (1m per year not unusual). They need VC for this to work.
Aislinn: InvestNI has been very helpful to Andor. Trade missions, logistics, finding partners, opening overseas offices. Also helped find new offices.
Hal: (Q:How do you help with Partner recruitment?) There is no substitute for doing the work yourself, don’t embrace the partnering model before you understand your customer base and your own product. Understand the economics of your supply chain.
Gerry: (Q:Does the Celtic Tiger help Irish companies?) Everywhere you go people have heard about the Celtic Tiger. Its easier to approach Irish companies as a result. Makes Eastern Europe very approachable. Your in the door! We need to do more in emerging markets (India, China, Mexico, Brazil, the Gulf states).
John: (Q:Why take a risk with property so lucrative?) There are large emerging markets with significant capital spend (mobile, networks, broadband). Traditional markets (US, Continental Europe) have made investments. Emerging markets have no legacy systems (e.g. China is a mobile network only).
Aislinn: Our stable market customers are moving to the emerging markets and dragging us along.
Hal: (Q:Is innovation the key?) Innovation is important and differentiation is key. You also need to understand your customer.