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Ruling the world Success has punctuated the story of Sarah Wood. Now, following its £114m acquisition by News Corp, she’s busy writing a new chapter for Unruly, the adtech company she co-founded in 2006 Cover Apr16.indd 1

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23/12/2015 21/12/2015 09:58 12:10


THE ELITE Interview

Sarah Wood It’s full steam ahead for Unruly’s charismatic CEO



Contents Apr16.indd 1

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Blazing a trail

How Blaze is putting cyclists in safe hands with top-notch tech

issue 38 APRIL 16

REGULARS 09 10 15 82

From the editor Upfront The big idea The crunch

columns 17 19 29 31

Jacqueline Gold Ed Relf Mark Pearson Alice Bentinck




bucks can often be a good bet

career might make all the difference

For love or money Turning down the big

Plotting a path An entrepreneur’s early



is bringing rich rewards for brands

to ignore the enormous potential of VR

Top vlogs The vlogger community

The new reality Startups can ill-afford



smarter with the help of tech-savvy startups

option but to take whisteblowers seriously

Beneath a steel sky Cities are getting

Rules of disclosure Employers have little


Contents Apr16.indd 2


04/04/2016 14:28

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FROM THE EDITOR EDITORIAL Adam Pescod - Editor Josh Russell – Web Editor DESIGN/PRODUCTION Leona Connor – Head Designer Jenny Allen – Intern Designer Dan Lecount – Web Development Manager SALES Harrison Bloor – Senior Account Manager Gemma Campion – Account Manager Jazmin Humphreys – Account Manager MARKETING David Thomas – Group Marketing Manager CIRCULATION Paul Kirby – Circulation & Data Manager ACCOUNTS Sally Stoker – Finance Manager Colin Munday - Management Accountant ADMINISTRATION Emily Fulcher - Administrator DIRECTOR Scott English – Managing Director Circulation/subscription UK £18, Europe £38, Rest of World £60 Elite Business Magazine is published four times a year by CE Media Solutions Limited, 4th Floor, Victoria House, Victoria Road, Chelmsford, CM1 1JR Copyright 2016. All rights reserved No part of Elite Business may be reproduced, stored in a retrieval system or transmitted in any form or by any means, without the prior written consent of the editor. Elite Business magazine will make every effort to return picture material, but this is at the owner’s risk. Due to the nature of the printing process, images can be subject to a variation of up to 15%, therefore CE Media Limited cannot be held responsible for such variation.

One in a million

There aren’t enough superlatives to describe Sarah Wood. Indeed, News Corp’s £114m acquisition of Unruly – the social video company she founded with husband Scott Button and Matthew Cooke in 2006 – barely scratches the surface of her achievements.

Prior to Unruly, Wood enjoyed an illustrious academic career that took her from Cambridge to UCL and, latterly, the University of Sussex. Not only has this passion for academia informed and inspired her entrepreneurial journey but it’s also something she continues to practice. Since 2012, Wood has delivered a module on online video culture for students at Cambridge. Her natural curiosity and love of research certainly shines through with Unruly: the company was born from its founders’ desire to learn more about

what makes online videos go viral. But it’s not just what Wood has done with her own business that has elevated her to a position among the UK’s entrepreneurial elite. Her tireless work promoting the UK’s startup scene and fighting the cause for women in tech has brought plenty of praise, not to mention countless awards. And it’s this, more than anything, that separates Wood from many of her Tech City peers. Adam Pescod - Editor


Ed Relf If sitting at the head of ondemand laundry startup Laundrapp has taught Relf anything, it’s that to make money, you’ve got to offer a superlative level of service.

ALICE Bentinck Given she has spent five years matching entrepreneurs with ideas at Entrepreneur First, Bentinck was the perfect person to pen us a piece on identifying the right problem to solve.

Mark Pearson As the co-founder of Fuel Ventures, a fund for early-stage tech startups, it’s safe to say that a column on the best time to raise investment was a piece of cake for Pearson.

Jacqueline Gold With her company Ann Summers making a move into the online dating sphere earlier this year, Gold is on hand to espouse the benefits of innovation for burgeoning retail businesses.


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04/04/2016 17:18

DOING THE ROUNDS The investment rounds that rocked the startup community last quarter


$40m Series c The analytics and personalisation platform nabbed a cool $40m from Goldman Sachs, Sapphire Ventures, Salesforce Ventures and Accel.



Millenials don’t pick mobile payments

Series A The personal health service closed a hearty $25m Series A led by Investment AB Kinnevik and supported by Innocent Drinks’ Richard Reed and DeepMind’s Demis Hassabis.

With the fanfare that greeted the arrival of Apple Pay on these shores, you would be forgiven for thinking that everyone and their mother is embracing mobile payments. However, it seems that millennials – typically viewed as the quintessential early-adopters – still are far from won over by the tech. According to a survey commission by YourCash Europe, only 3.5% of 18to 35-year-olds use mobile payment


£17m Series B Taking its total investment to somewhere north of £100m, peer-to-peer online mortgage platform LendInvest has topped up with £17m from Atomico.

Fine print Staff urge businesses to adopt 3D printing

$13m Series C Having secured $13m from Notion Capital, Axcel Partners, Balderton Capital and Passion Capital, the online Direct Debit provider’s model is clearly paying dividends.


Words: Adam Pescod, Josh Russell


solutions like Apple Pay on a daily basis and a colossal 95% don’t believe that it will be their payment method of choice in ten years. It does appear that the contactless card fares rather better, with 15% of millennials whipping theirs out at least once a day and 17% stating that it will be their go-to payment method by 2026. Now there’s something you can take to the bank.

It’s not just gearheads and journos getting excited about 3D printing. Research from Infomentum has revealed a third of UK employees believe their business should be embracing the tech by 2020, with the most oft-cited reason being the ability to instantly print downloaded products. But this isn’t the only paraphernalia employees have a predilection for, with 14% wanting their employer to adopt drone delivery services, one in five clamouring for bitcoin and 15% believing augmented reality should be employed as a part of the buyer journey. As things stand, half of UK employees believe that their workplace’s tech isn’t up to snuff and a whopping 91% feel this will hinder the company’s productivity by 2020. Best get buying those gadgets and gear then.


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04/04/2016 14:34


London loves beer The number of new

breweries in the capital jumped by 24% last year

Literary Corner

Wiley OUT Now £17.99

From Brewdog down to small-time microbreweries, it’s safe to say brewing fever has captured the nation in recent years. And, according to stats from accountants UHY Hacker Young, London is outstripping the rest of England with its rate of new openings. The number of new breweries in the capital reached a new high last year – jumping 24% from 29 in 2014 to 36 in 2015. However, the story is rather different for the rest of the country, where the number of new openings dropped 10%, from 278 in 2014 to 249 in 2015. Meanwhile, other parts of the UK saw small increases: 27 breweries opened their doors in Scotland last year, compared to 26 in 2014, while the number of new breweries in Northern Ireland increased from six in 2014 to seven in 2015. Finally, Wales saw its number of new openings jump by over 50%, from 11 in 2014 to 17 last year. And with recent stats from the Campaign for Real Ale (CAMRA) showing that UK brewery numbers hit an all-time high in 2015, we’d say there’s plenty to drink to.


by Karie Willyerd & Barbara Mistick In a world irrevocably altered by technology, no job is safe. This means it’s not just companies that need to continually reinvent themselves; with the modern workplace undergoing a fundamental transformation, it’s never been more important for employees to keep themselves relevant. So how can professionals avoid reaching their sell-by date? This is the question that Stretch looks to answer. Drawing upon their own expertise – as well as the experience of multiple executives and employees – Willyerd and Mistick do a brilliant job of making readers step back and assess whether their career is future-proofed. Whether it’s building a network of reliable

contacts, taking a sabbatical or starting a business on the side, the authors leave no stone unturned in their quest to help equip professionals with all the tools required to extend their working lives. But it’s not only employees that can take inspiration from Stretch; each chapter concludes with a handy section targeted at employers, offering tips on how they can keep their people engaged, excited and optimistic about their future prospects. With insight from business leaders and real-life stories from employees who have successfully ‘stretched’, anyone with their mind to a rewarding career would be well advised to grab a copy of Stretch. AP

Coming up April 14 Thames Valley Expo Royal Windsor Racecourse, Maidenhead Rd, Windsor, SL4 5JJ

April 14 - 15 Northern Business Exhibition EventCity, Phoenix Way, Manchester, M41 7TB

April 19 - 20 UC EXPO London Olympia, Hammersmith Road, London, W14 8UX

April 21 The Business Growth Show West Ham Football Club, Upton Park, Green Street, London, E13 9AZ

April 27 - 28 Internet Retailing Expo NEC, North Avenue, Birmingham, B40 1NT

May 11 Kent Vision Live Kent Event Centre, Kent Showground, Detling, ME14 3JF

June 21 - 22 Interop ExCeL, Royal Victoria Dock, London, E16 1XL

A full event listing is available on our website: events


Upfront (Apr16).indd 2


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I’m concerned that the commitments the government made during the election campaign – to try and appear tough on Europe – could now threaten the growth of many UK small businesses. The movement of labour across the EU is vast and one of the principal reasons why I hope the UK votes to stay part of the EU. There are many small business owners who rely on the availability of a workforce with diverse skills from across the EU to grow their companies successfully. Europe is a natural market for many UK businesses, as well as a source of talent. Martin Campbell, MD, Ormsby Street

EU in?

How does Britain’s business community think we should vote in the EU referendum on June 23? In June, the biggest question mark hanging over Europe is set to be resolved – and we’re not talking about who’s going to win Euro 2016. Since the date of the referendum on Britain’s future within the EU was announced way back in February, both sides of the debate have hit the campaign trail hard, with everyone from James Dyson to Stephen Hawking chipping in their two cents. And with the Bank of England describing the referendum as the most significant domestic risk to the UK’s financial stability, there’s clearly a lot at stake. So how do British businesses feel about a potential Brexit? Is the startup community going to be better off with Britain inside or outside of the EU?

Currently our overseas trade is tied to EU policy and trade agreements. These are not all bad but none add to the UK’s ability to compete wherever it wants to. In fact, there are many cases where our industries are bound up in the common interests of all EU members, which are often not aligned with the UK’s interests. Outside of the EU, the UK will be much more efficient and yet geographically well placed to trade with western and eastern Europe. This will make the UK one of the most attractive nations for investors in industry and business. Stephen Archer, business analyst and director, Spring Partnerships 12

Given London’s position as a tech startup hub and driver of economic growth, a Brexit would be disastrous. If the UK leaves the EU, every cross-border contract would be torn up and have to be renegotiated – but the ramifications are wider than that. EU membership brings companies – especially those in the technology space – an increasingly coherent set of regulations that unify business opportunity in the digital world. We need to have the same rules for data privacy, data usage and intellectual property regulations to allow startups to scale up more effectively. Erki Kert, CEO, Big Data Scoring

An exit from the EU would be detrimental over the short-term to London’s competitiveness as the startup capital of Europe and, in the long-term, will stifle our ability to be able to create the next generation of billion-dollar companies. The issue is uncertainty: if I’m an investor who wants to invest in a UK company, I suddenly have a large number of unanswerable questions on the ability of that company to scale across Europe. This increases risk and therefore limits investment in UK firms, while pushing that investment across the channel to Europe. James Hind, co-founder, carwow


Upfront (Apr16).indd 3

04/04/2016 14:34

UPFRONT Marketing misfortune

What’s the word?

Small businesses can’t tell their ROI from their PPC, says survey

betto rodrigues /

It’s hard to overstate the importance of marketing to any fledgling enterprise. Having a great product is one thing but if nobody knows about it, you haven’t got a business. Worryingly, a new survey has revealed that a large number of small businesses are struggling with their marketing efforts. Of the 1,100 smallbusiness owners surveyed by freelancer marketplace PeoplePerHour, 23%

said it was ‘almost impossible’ to find a marketing director, with 21% admitting they had no clear marketing plan for the next quarter. While 64% of respondents said measuring ROI was particularly challenging, 48% said it was difficult to define their target audience and 30% admitted to having trouble keeping up with trends. Three guesses where SMEs should be focusing their spend this year.

After what seems like an excruciatingly long wait, the virtual-reality headset Oculus Rift has finally started shipping to feverish fans around the world. But it seems one early adopter got a little more than he bargained for. Unsuspecting Alaska resident Ross Martin had his Rift delivered in person by the company’s founder Palmer Luckey a full two days early, thanks to the fact that he was the first customer to pre-order the device back in January. “I’ll be damned if some random delivery guy is going to get the satisfaction of delivering the first Rift,” Luckey said, speaking to game site Polygon. “That’s mine.”

Virtual unreality

Founder drops off first Oculus Rift in person

“This isn’t the company that really changed the world” Apple co-founder Steve Wozniak gives a damning assessment of the company he left in 1985 in an interview with Reddit

“We are not going to be relevant unless we are inclusive” Jack Dorsey makes a promise to the National Society of Black Engineers after Twitter was criticised for not hiring enough women and minorities

“The latest changes to benefits [for the disabled] are a compromise too far” An extract from the resignation letter of Iain Duncan Smith, who stepped down as work and pensions secretary over proposed cuts to disability benefits

Find us on Twitter @elitebizmag


Successful crowdfunding campaigns that have closed in the last quarter









10% interest

11.1% equity

4.8% equity

3.3% equity

With its Land Bond delivering double its investment target, the crowd has certainly gone wild for the property developer that’s bringing affordable homes to London’s middle earners.

Having already wowed Deborah Meaden with its revolutionary plasterboard fixing, the future looks even brighter for Gripit after a very successful Crowdcube campaign.

The online letting agent led by senior execs from Google, Zoopla and Samsung is on course to shake up the property market having smashed its investment target on Crowdcube.

The mobile-first bank made crowdfunding history after hitting its £1m target in 96 seconds. And with Passion Capital already investing £7m in the startup, we’d say it’s one to watch.


Upfront (Apr16).indd 4


04/04/2016 14:34


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Card Processing


23/12/2015 16:05 23/12/2015 15:57:55


Delivering the goods

New food-delivery startup Deliverd is bringing restaurant quality meals to consumers’ homes at a fraction of the price BY JOSH RUSSELL


here’s no denying that tech has forever changed the way we order food. Just as Hungryhouse and JustEat disrupted the traditional way consumers got their hands on fast food, a new wave of delivery startups has arisen to help provide restaurant-quality lunches and dinners to hungry Brits. The latest iteration of this kind of foodtech, Deliverd seems to be in a unique position to bring highquality takeaway to the masses in a way that perhaps its rivals can’t.

Founded by serial entrepreneur Paul Rawlings, Deliverd combines an idea like Deliveroo with that of EatFirst. However, rather than EatFirst’s worldrenowned chefs, Deliverd provides consumers chilled meals from the restaurants in their local area and allows them to heat up restaurant-quality food at home. Its customers can order online via text and get lunches and dinners delivered to homes, offices or a collection point and then finish cooking their cuisine when convenient for them. Whilst this may seem more like evolution than revolution, Deliverd definitely has some unique factors that help set it apart from others in the space. Whilst many of its competitors – from high-end EatFirst to the local pizza place – can cost near £10 a meal, Deliverd has purposely positioned itself at a low price point and offers meals from a wallet-friendly £4. But perhaps more intriguing is the way its meals are created: it enables local restaurants to use time that would otherwise be wasted to prepare and chill the food, unlocking greater efficiencies for those restaurants and helping Deliverd to keep its prices low. It’s still comparatively early days for the startup. However, unlike startups like Deliveroo that concentrated much of their energy on London to begin with, Deliverd is first focusing on conquering the north, helping it to gain a real foothold in a crowded market. Suffice to say, we’re sure it will be coming to kitchens across the nation very soon.


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04/04/2016 14:38

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04/04/2016 16:03

Jacqueline gold ceo, ann summers

The best retailers are innovators

Retail businesses that have innovation hardwired into their DNA have a greater chance of thriving in today’s competitive landscape


nnovation is absolutely vital to the success of modernday retailers, helping them to establish a strong USP that sets them apart from their competition. From our unique party-planning business that was launched in the early 1980s to the recent launch of our new dating app Rabbit, innovation has always been at the heart of everything we do here at Ann Summers. We made the decision to create a dating app because I wanted us to be more than a brand; I wanted us to be part

of our customers’ lifestyles. I could also see the synergy between a dating app and Ann Summers, a brand that is all about relationships. From speaking to experts who had launched dating apps previously – and by also speaking to our customers – we very quickly realised there was so much more that we could do with our product. Our goal was to create an experience that truly responded to users’ needs and addressed the frustrations they had with other dating apps. Following our research, we developed a number of unique features for the app. For example, by partnering with a number of venues, we gave users a choice of dating locations other than the local pub. Not only does this bring some muchneeded variety to the world of first dates but it also gives our partners an opportunity to offer a discount and draw more people to their venues. This helps increase brand awareness and sales, while also providing vital customer data. Whilst we have innovated at the right time and for the right reasons, other businesses have suffered because they have either failed to innovate or have done so just for the sake of it. We’ve all heard the old expression ‘if it ain’t broke, don’t fix it.’ It’s important not to meddle with the aspects of your business that really work. Instead, you need to listen to your customers, understand who they really are and give them what they want. So, how can a business maintain a commitment to innovation? Some people argue that companies should have a team that is dedicated to innovation but I don’t agree with this. Instead of segmenting innovation in this way, I believe it needs to be part of your culture. This means encouraging an innovative way of working among your people, not just in one department but in all departments. Our own experience has taught us that innovation is not just about product; it’s also about the way you do things. Put simply, the retailers that are focused on innovation are the ones that will succeed. Think about it this way: if you don’t innovate, what’s the alternative? It’s to imitate. And no one wants a business that’s based on imitation. APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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04/04/2016 14:36

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04/04/2016 16:04

ed relf co-founder and CEO, Laundrapp

Get the service right and profit will follow

In an age when consumers can switch to your competitor at the tap of a finger, nailing your service is the key to keeping the cash coming in


he customer is always right. You’ve heard this a thousand times but it’s never been more pertinent than it is right now. In this new digital age, getting the service right is critical to your company. Thanks largely to the continuing growth of social media and large-scale review services such as Trustpilot, it’s never been more important that customers get the service they want in the time and place they expect. Being the CEO of an on-demand dry cleaning and laundry app, I know this first-hand. In my experience, putting the customer first is more important in laundry than it is in any other business because it’s an immensely personal service that requires a lot of trust. It’s also an industry steeped in tradition and personal relationships, where trust is the central foundation to building a lasting and loyal customer base. We’ve taken the traditional bricks and mortar model into the digital age, replacing the face-to-face element with an app. Thankfully, rapidly growing on-demand apps such as Uber and Deliveroo have built large-scale awareness and paved the way for other services delivered directly through an app – otherwise this would be an impossible challenge. Building loyalty and trust in a digital age with a

digital product is clearly tough. But even tougher is managing the expectations of an increasingly switched-on audience that is ready to switch at the tap of a button to your closest competitor. The adage ‘you’re only as good as your last order’ has never been truer, partly because it’s never been easier to switch services. Jeff Bezos, founder and CEO of Amazon, was once quoted as saying: “If you make customers unhappy in the physical world, they might each tell six friends. If you make customers unhappy on the internet, they can each tell 6,000 friends.” Today, thanks largely to the growth of mobile and the prominence of reviews within the App Store and Google Play store, providing a quality product and service is imperative in ensuring you retain prominence in the only shop window you have. At no other time in the history of business has over-promising and over-delivering been more important. The idea ‘focus on the service and profit will follow’ is an increasingly important approach, as apps and services claw desperately to keep their loyal customers engaged and away from competitors. With over 1.5 million apps on the App Store and the average smartphone user having approximately 50 apps on their devices, the customer has never been more powerful. They can make or break your business like never before. The old adage that the customer is king has never been more relevant but in this new and emerging digital age the customer is not only king – they’re also a king-maker. APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

E. Relf column (Apr 16).indd 1


04/04/2016 16:42

Funding for growth

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We understand that finding the right funding for your growth plans can be a daunting prospect, but the answer could be closer than you think. At ABN AMRO Commercial Finance we have the expertise and understanding to help you release the working capital within your assets. Our Asset Based Lending solutions give you the confidence you need to grow your business on your own terms. Contact our team of experts on 0808 278 4787 to find out more.

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29/09/2015 15:49


Building your business with receivables finance – a leap into the unknown? Access to finance is commonly highlighted as a key problem for growing companies that are trying to juggle overheads while being hampered by Britain’s notorious late-payment culture. Receivables finance is a long established tool to release working capital from a company’s assets, the greatest of which is unpaid invoices. However, awareness of its existence and potential benefits is still painfully low among a large proportion of SMEs. A type of asset-based lending (ABL), receivables finance is perhaps one of the best kept secrets in the funding landscape. And it comes in two simple forms. 1 Factoring An ABL partner will advance up to 90% on unpaid invoices and will include credit control so that it collects from your customer. This can result in a reduction of late payment stress and, in some cases, headcount. This combination has the potential to allow the business to focus on growth strategy and new custom. The remaining invoice value is advanced upon receipt minus a fee. 2 Invoice discounting Again, an advance of up to 90% on invoices is available but it is often offered confidentially to businesses with a well-established in-house sales ledger management team, which collects payment from customers in the normal way.

So why isn’t it growing? The Asset Based Finance Association (ABFA), the trade body that works with organisations and businesses to regulate the industry, reported in January 2016 that ABL supports 15.1% of all UK company turnover (¤189.7bn). That equates to one-third higher than the European average. Separate research conducted by FundInvoice found that only 12% of the 100 fast-growth companies it surveyed were using invoice finance. Of the rest, only 5% had considered it, and the reasons why were quite revealing. Some 23.8% had never heard of it; 27.4% said that it wasn’t mentioned as an option by the bank’s accountants or advisors; 11.9% thought it would be too expensive and 3.6% still believed it was the last resort for failing companies. Ironically, another poll by FundInvoice suggested that those using invoice finance grow quicker than those that don’t. It found that 12% of companies with turnover growth of over 20% per annum were using invoice finance, against an estimate of just 0.86% of UK businesses overall. And when existing invoice-finance customers were asked if using these services had enabled them to grow their business, the vast majority confirmed that they had. So, while ABL’s greater adoption is being held back by a lack of awareness and pre-conception of high costs, businesses that have used the funding method are statistically proven to grow faster. ABN AMRO Commercial Finance is trying to deliver some clarity and transparency and has just launched a dedicated campaign to those new to receivables finance. Its 3-2-1 promotion offers three months of base-rate discount charges to ease the financial investment, a two-part loyalty reward to celebrate the ongoing partnership and a one-month rolling agreement to demonstrate its confidence that once you’ve experienced the benefits of receivables finance, you’ll want to maximise them to the full.

Receivables finance is perhaps one of the best kept secrets in the funding landscape


ABN AMRO Advertorial Apr16.indd 1


04/04/2016 16:06


comes to life Lisbon’s startup scene is still in its infancy but with Web Summit coming to the Portuguese capital this summer, it suddenly looks set to explode BY ADAM PESCOD


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04/04/2016 16:44

After a six-year stint in Dublin, Web Summit has a new home for the next three years. In July, thousands of entrepreneurs, investors and influencers will descend on the Portuguese capital of Lisbon for the week-long tech event. Not only is it a massive endorsement of the city but it’s something that would have been unthinkable a mere five years ago. “Before 2012, nobody in Lisbon really knew what a startup was,” says Anthony Douglas, founder and CEO of Hole19, the golf app. The roots of Lisbon’s burgeoning startup scene can be traced back to the establishment of Startup Lisboa, the incubator that’s spawned some of the city’s most successful companies. A joint project between Lisbon’s city council, the Portuguese government and Montepio, a Lisbon-based bank, it has helped revitalise the city’s historic district and put it on the map as a serious startup hub. “With a little help from local government, it really brought a lot of people together and created the spark for startups in Lisbon,” says Douglas. APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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It is also bringing a renewed sense of optimism to a city and country that has been ravaged by recession. “In the context of the economic backdrop, the successes coming out of the startup company were almost a silver lining,” says Ben Grech, co-founder and CEO of Uniplaces, the student accommodation platform. And, in many ways, the downturn created the perfect environment for Lisbon’s startups to thrive. “These times of crises open up windows of opportunity,” says Miguel Fontes, executive director of Startup Lisboa. “And it was one of these windows of opportunity that made us believe that startups, especially in the technological field, [could] succeed in Lisbon.” On a practical level, Lisbon certainly appears to be an ideal place to launch and grow a successful tech business. As Fontes explains, many young people in the city speak English fluently; there’s an ample amount of tech talent; the quality of life is high; and the cost of living is very low compared to other European capitals. Companies can also rent an office in the city centre for less than ¤12 per square metre. “All of these factors have been decisive to the growth of our entrepreneurs and to the enhancement of their businesses,” he says. “They have also allowed entrepreneurs from other continents to use Lisbon as a gateway for their products in Europe or choose our capital to create their startups.” The size of the Portuguese market evidently makes Lisbon a prime location from which to springboard into international markets. In fact, any company launching in the city has little choice but to look overseas from day one. “Our advantage is that we 24

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Web Summit represents a watershed moment for Lisbon Nuno Sebastiao, Feedzai

can’t afford to think local,” says Douglas. “We have to be global from the get-go.” Yet it still provides startups a small, cost-effective market in which to trial their products before taking them to a global audience. “The size of our market does not allow us to compete with large markets like London or Berlin,” says Fontes. “[This means] we have to focus on what we are really good at and our experience perfectly shows that we can be a strong test market for startups that will eventually want to make the leap to larger markets.” The ease and cost of doing business in Lisbon might be appealing but a fully-functioning ecosystem depends on a decent flow of funding. Thankfully, the Portuguese city isn’t lacking in early-stage capital: the likes of Faber Ventures and Portugal Ventures have stumped up seed funding for a number of startups, while firms such as Caixa Capital have participated


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Living the dream Uniplaces

in Series A and B rounds. “There are also a number of EU initiatives that have encouraged angel investment in the market,” says Grech. “That has helped provide a funding background to all of these early-stage businesses.” However, Lisbon is still a long way off London and Berlin – not to mention Silicon Valley – when it comes to the availability of later-stage capital. “The challenge with any small country like Portugal is usually the next round of financing,” says Vasco Pedro, founder and CEO of Unbabel, the translation startup. “We haven’t had anyone selling their company and starting to reinvest in the ecosystem.” As a result, many startups have had to look further afield for growth finance. And in the case of companies like Veniam and Talkdesk – which have both raised over $20m – it has also meant moving their HQs to California. Suffice to say, this could all start to change when Web Summit comes to town. Anthony Douglas, Hole19 “Suddenly you’re going to have a tonne of investors seeing the ecosystem here for the first time,” says Pedro. In Douglas’s view, it’s a chance for Lisbon to truly make it mark on the global stage. “Lisbon needs to define its own identity as a city,” he says. “With the Web Summit coming, it’s a good opportunity for people to see what Lisbon is all about.” But more than anything, it’s just reward for what the city has managed to achieve in such a short space of time. “Web Summit represents a watershed moment for Lisbon,” says Nuno Sebastiao, chairman and CEO of Feedzai, the fraud prevention startup. “It’s validation of what I’ve witnessed happening for years: that Lisbon is up and coming.”

Before 2012, nobody in Lisbon really knew what a startup was


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It’s hardly surprising that the inspiration for student accommodation platform Uniplaces came while it founders were at university. “We were very interested in tech startups and the innovation happening in travel with things like Airbnb,” says Ben Grech, co-founder and CEO of Uniplaces. This opened their eyes to the inefficiencies of the student accommodation market. “We were stunned at how far behind it was compared to the travel industry,” says Grech. “Students spend $200bn in the private rental sector every year and that got us really excited about what we could create.” One of the first decisions Uniplaces had to make was where to launch. “We didn’t feel an urge to go to a big market,” says Grech. “We needed a place where we could work together relatively cheaply until we were ready to go out and execute.” And Lisbon seemed to tick all the right boxes. “It’s the same time zone as London, there are a lot of well-trained multilingual people, there are good universities producing great engineers and the salary cost is lower,” he says. “It just made a lot of sense.” By April 2015, Uniplaces was active in 39 cities across eight European countries. And last November, to further propel its international growth, the company raised a $24m Series A led by Atomico, with participation from Lisbon’s Caixa Capital and Shilling Capital Partners. Zoopla’s Alex Chesterman and William Reeve of LoveFilm also invested in Uniplaces at seed stage. “We have attracted a really global group of investors,” says Grech. The company has had a London office since 2013 but the importance of Lisbon to the Uniplaces story is clear. “I’m not sure we would be around as a business today if we didn’t start in Lisbon,” says Grech.


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Mark Pearson co-founder, Fuel Ventures

When is the best time to seek investment?

An injection of funding can help any fledgling startup get off the ground but timing is everything when it comes to raising investment


hile some companies have bootstrapped their way to success, many entrepreneurs will turn to the investor community to help fund the growth of their startup. But when is the best time to seek investment? There is no right answer to this question because it depends so much on the business. What stage of development has it reached? What sector is it in? How much investment has it secured from family and friends? An entrepreneur needs to consider all of these questions before approaching investors but they also need to decide whether they will be seeking investment pre-launch or post-launch. Pre-launch The main advantage of seeking investment before launch is that you’re getting the brand name out there in advance; it’s always beneficial to get in early if your business is in a crowded market where there is a lot of competition. And even if no investment is made, at least the right people have acknowledged the business and are aware of it. Finally, it also gives founders the opportunity to network and build a rapport with potential future investors. However, securing investment before launch can also dilute the value of a business. Ultimately it is difficult to evaluate a business that is not yet trading, which means it will be undervalued initially. This can be particularly frustrating as a founder, especially if your business does incredibly well after launching and you’re left with less equity than if you had secured investment post-launch. For those entrepreneurs looking to secure investment pre-launch, it’s essential to have a strong idea and team. This will give investors confidence that the business will work and make

money before they part with any cash. If you’re not yet at this stage, it’s better to hold fire as you could end up doing more damage to your reputation and, ultimately, your business. Post-launch There’s a lot to be said for a business that grows organically on its own. Not only is it impressive to investors but it also proves there’s a demand for your product or service. My advice to a new business would be to grow as quickly as possible in this initial period so you’re in a much stronger position when it comes to seeking investment. This will increase investor confidence and give the founder more power and control in the investment process. In my experience, more founders tend to maintain maximum equity ownership with post-launch investments than with pre-launch investments. However, it is important founders do not wait too long and underestimate how long securing investment can take. From pitch to closing it can take as long as six months. Getting the timing wrong can be very damaging to a business. APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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Big Energy Products for Small Businesses

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22/12/2015 16:02

Alice Bentinck co-founder, Entrepreneur First

What’s your problem?

Identifying the right pain point to solve can be the key to building a successful startup


igh-profile west-coast investor Peter Thiel says that the best founders should have a secret. At Entrepreneur First, we believe the most reliable way to find a secret is by leveraging your existing skills or knowledge. The best founders work on ideas at the intersection of an area they know deeply and where they have advanced skills that allow them to outmanoeuvre others. Sometimes it will be through combining one founder’s skills and another founder’s knowledge. For example, Larry Page and Sergey Brin used the research from their PhDs at Stanford to create the first version of Google, while John and Patrick Collison created Stripe because they’d experienced the pain of trying to integrate payments. Would Page and Brin have been the best people to build Stripe? No. They lacked the understanding of the problem. Would the Collison brothers have been well placed to found Google? No. They didn’t have the academic background to build PageRank. Deep understanding Founders who understand a problem deeply should see this as an asset that they can create fresh ideas around. Having deep knowledge means that you can provide singular insight into the problem. When a founder tells me something shocking or surprising about an industry – something that I couldn’t have guessed as an outsider – I know that they are in the position to create something unique.

Having deep knowledge means that you can provide singular insight into the problem

The easy option It is easy for first-time founders to pick problems that they may have experienced once but for which they don’t have the deep expertise or advanced skills to solve. This is where ideas around things like food delivery, dating and house renting often come from. Why do founders do this? It feels easy. When you have limited knowledge about a market or a problem, you don’t know the challenges that you will face. This space is often highly competitive: there are low barriers for founders to enter the market, it’s relatively easy for other founders to come up with the same idea and many entrepreneurs have a similar skill set. This makes startups in this space hard to defend. What is the right idea for you to be working on? The right business for you to build is different from the right business for your peers to build. To ensure you’re building the most valuable startup for you, it’s important to utilise the skills and knowledge you already have, understand why you’re unique and build something valuable. APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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ne could be forgiven for assuming that Emily Brooke, co-founder and CEO of urban-cycling company Blaze, has spent her life on a bike. But, as Brooke admits, she hasn’t always been that comfortable on the saddle. “I had a bike at Oxford [University] but gave up because I thought it was miserable and I hadn’t realised after about six weeks that both of my tyres were completely flat,” she says. Brooke’s passion for cycling was ignited in 2010 when, following the death of a close friend, she organised a charity bike ride from Land’s End to John o’ Groats. Spending some time on two wheels opened her eyes to the dangers that cyclists face on a daily basis. It also inspired her final-year project at Brighton University, where she was studying product design. “I wanted to make a difference and solve a real problem so I spent six months working with a driving psychologist, analysing the statistics of which accidents happen the most,” says Brooke. She discovered that the biggest cause of accidents is the blind spot of other vehicles. “I found out that 79% of collisions happen when a vehicle drives into a bike that is travelling straight ahead,” she adds. “That’s the problem I wanted to tackle.”







The only thing Brooke needed was a product idea – and it presented itself while she was cycling towards Brighton seafront. “I came to a junction and there was a white van in front of me. I wished I was 55 yards ahead so the driver could see me,” she says. “I thought: ‘I could project myself there.’” Before long, Brooke had set about developing what would become Blaze’s flagship product, Laserlight. And it’s fair to say she was starting from scratch. “I had no idea what I was doing so I just had to go and find people who did,” she says. Fortunately, she didn’t have to look too far. “I managed to find a laser expert down on the south coast and spent many afternoons sitting in his studio asking him lots of questions,” she adds. The end product was an incredibly impressive piece of kit: a fully waterproof front light that also projects a bright green bike onto the road to alert other vehicles that there is a cyclist in their blind spot. Recognising how innovative a product she had conceived, Brooke sought advice on securing a patent from the IPO Office. “They were really receptive and incredibly helpful,” she says. After a lengthy process, the patent was accepted, representing a massive landmark for Brooke’s fledgling startup. “There was a lot of back and forth but it was great news for us,” she adds. Something else that entailed a lot of back and forth was having the product manufactured in China. “It was a very steep learning curve, which we are still very much on,” says Brooke. Yet it could have been even more arduous had Brooke not met Liam Casey, founder and CEO of manucturing giant PCH, at Founders Forum. “He is probably one of the most inspirational entrepreneurs I have met. Completely mad but brilliant,” says Brookes. “He said, ‘We could do this; we could manufacture the Laserlight.’ And I was on a plane to China within three hours.” But there was still one more thing to nail down: whether Laserlight was fit for market. To this end, Brooke placed the product on Kickstarter in December 2012 to get an idea of how well it would sell. When it raised £55,000 – more than double its fundraising target of £25,000 – Brooke knew she was onto something special. “It was the first moment that this was an actual viable business; there was money in the



accounts” says Brooke. “It was an amazing feeling.” And having attracted investors from 40 countries, Blaze didn’t have to worry about cracking the UK before setting its sights overseas. “I said from day one that I wanted to build a global urban cycling brand and from day one on Kickstarter, we were pretty much global”, says Brooke. In spite of this, it was evident the company wouldn’t be able to build up a strong position in the cycling market without a serious injection of capital. In February 2014, the company closed a seed round of $500,000, led by Index Ventures and Richard Branson. Brooke first met the Virgin founder at Founders Forum, which he was attending with his children. “I was there with a very early prototype and his son Sam came over and said: ‘This is really cool,’” says Brooke. “The next minute, his sister Holly came over and said: ‘Wow, my brother said this is really cool.’ And then Richard comes over and said: ‘My kids said this is really cool.


You should come in for a meeting.’” By this point, Brooke had also expanded her team, bringing in Philip Ellis as Blaze’s co-founder and COO. Although she’d managed to build a prototype and run a successful Kickstarter campaign without a right-hand man, Brooke says the appointment of Ellis has been crucial to the company’s success. “I can’t imagine doing it without him now because he does all the things that I am crap at,” she laughs. Flush with the funding from its seed round, Blaze could push ahead with new projects. These included its back light, the Blaze Burner, the development of which had begun around the same time as Laserlight. “We wanted to do a back light from the beginning but Laserlight took over,” says Brooke. While it might not be as eye-catching as its sister product, the Blaze Burner still has some neat components, including a magnetic bracket that allows cyclists to unclip it with one hand while riding. It also emits diffuse light, which doesn’t shine directly into the eyes of drivers behind. “We just wanted the most visible high-performance back light you could possibly have,” says Brooke. “So we considered everything and really started from the ground up.” Nevertheless, Brooke still had reservations about how well the Blaze Burner would be received. “I was quite nervous because Laserlight is such an innovation and has such an obvious USP, whereas the back light is

just a very good light,” she says. “I wondered whether people would take time to understand that.” Her doubts were dispelled when Blaze Burner raised more than four times its original Kickstarter target, drawing in over £150,000. “To reach our target of £35,000 within hours of opening the campaign was completely mad and very exciting,” she adds. Equally exciting is the deal that Blaze reached with Transport for London (TfL) and Santander last December, which has resulted in a Laserlight being fitted on every one of the capital’s 11,500 Santander bikes. As part of the partnership, TfL and Santander commissioned 12 weeks of research from the Transport Research Laboratory. “They did all this testing and sent us a 92-page document, which is absolutely golden,” says Brooke. “One of the things it says is that a bike with a Laserlight in pitch black is more visible than a bike without in broad daylight. So there are some really fantastic statistics and data that we can now use to market Laserlight going forward.” Brooke is hoping to establish similar partnerships in other cities around the world, revealing that she’s already taken a couple of trips across the pond. And, as Elite Business went to print, Blaze was on the verge of opening its Series A round. The funding will be used to help expand the company’s team and develop new products. “We’ll be looking to raise between £3m and £5m,” says Brooke. “It’s going to be for both the consumer and B2B sides of the business.” With plenty of ideas in the pipeline and a big investment round on the horizon, Blaze certainly looks well on course to revolutionise the world of cycling. And Brooke has her sights set suitably high. “I want to build the Apple for bikes,” she concludes. APR 2016 ELITEBUSINESSMAGAZINE.CO.UK


B u yo u ts

love money A big money offer will turn the head of most entrepreneurs. But sometimes it’s better to scale up than sell up BY ADAM PESCOD

Back in 2006, Facebook stood on the verge of a $1bn acquisition by Yahoo. However, Mark Zuckerberg pulled out of the deal at the last minute when Yahoo reduced its offer for the then fledgling social media startup. “Today Facebook is a $250-300bn company but it’s not as if they were not tempted [to sell],” says Davor Hebel, managing partner at Eight Roads Ventures, the VC firm. Certainly there can be no greater dilemma for an entrepreneur than receiving a lucrative offer for their business. “Just like taking an investment is a massive step in a company’s development, selling a company is a potentially life-changing event for a founder,” says Hebel. On the one hand, an entrepreneur could be looking at early retirement and a tidy sum to support their loved ones. But on the other, they will face having to cede control of something they have built from scratch. “The consideration has to be firstly financial and secondly it needs to be: ‘Who are you selling to?” says Hebel. “A lot of people set up companies so that they can be independent but, by selling, 36


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B uyouts

there will be a fundamentally new arrangement. They are likely to get a new boss.” And, quite often, there’s more than one person’s perspective to take into account. “The tension between entrepreneur and investors is real,” Hebel says. “Even when you are raising your Series A, you should be thinking about whether your investors are aligned with your vision.” This will help when an offer does eventually land on the table. “Sometimes it’s a really difficult decision to make because you are trading off money today for a potentially significant upside tomorrow,” says Hebel. Saying no to $100m In December 2015, Guy Mucklow and Jamie Turner were offered $100m for their postcodelookup company PCA Predict, previously Postcode Anywhere. It wasn’t the first time they’d been approached by a potential buyer. “We’ve had a lot of interest over the years from lots of different quarters, which is very flattering,” says Mucklow. “I suppose we are reasonably attractive because we have no external investors and 15 years of very solid growth.” At the time of the latest offer, Mucklow and Turner were on the verge of launching their new

product, a big-data tool called Triggar. As such, it seemed prudent to wave goodbye to PCA Predict and inject the capital from the sale into their new project. But it wasn’t quite that simple. “We found ourselves at this strategic crossroads,” says Mucklow. “We didn’t know whether to drive a wedge between the two businesses or try and bring them more closely together.” Realising that the success of Triggar The money is hinged on a rich pool of customer data, the pair decided they couldn’t afford to just a measure let go of PCA Predict just yet. “In the of success and that’s why we can big data world, it’s a chicken and egg says Mucklow. “You need walk away from a situation,” the data to get the customers but then large number you need the customers to get the data. On the one hand, we had Postcode Guy Mucklow, PCA Anywhere’s customers – 10,000 to Predict 11,000 of them – but we had none with the Triggar business.” They were also reluctant to part ways with something they’d put everything into building. “If you’re selling a business that you have grown


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B u yo u ts

Crunch time It was only four years after launching Crunch Accounting, the online accountancy firm, that the company’s founder and CEO Darren Fell was given the option to sell up. “It’s hard not to be flattered when an offer comes along,” he says. “You work long days and weekends for years on end to build something, so it’s hugely gratifying for a much larger multinational company to say ‘we like what you’re doing so much that we want to buy it from you.’” But while the money on the table might have been attractive, Fell wasn’t comfortable with the thought of handing over the reins so early in Crunch’s journey. “I know many entrepreneurs who are building purely for the big exit,” he says. “[But] when the offer was made, we were just getting started on our next phase of growth and I didn’t want to throw all of that away.” The fact that Crunch would have had no future following the deal was the clincher. “We would have been more receptive if somebody had wanted to acquire our intellectual property but let us continue operating as a standalone business,” he says. “But the suitor in this case purely wanted our technology for use in another unrelated – and actually very boring – division of their business.” The decision to turn down the offer also had the backing of Crunch’s investors and shareholders, which included a number of its employees. “Luckily everyone involved in the decision had the same thoughts on it,” says Fell. “We all recognised that the business has so much more potential and room for growth that it’d be criminal not to pursue all our other ideas.” Crunch has since expanded its product range to include an online marketplace, which gives clients easy access to essential and affordable services like business insurance and legal advice. “We’ve been in this industry long enough that we know the best providers,” says Fell. “So we put them all under one roof to save business owners some time and money.” Suffice to say, he isn’t looking to sell up anytime soon. “We have so many exciting projects going on at the moment,” he concludes. “We’d be mad to sell to someone else.”

The consideration has to be firstly financial and secondly it needs to be: ‘Who are you selling to?’ Davor Hebel, Eight Roads Ventures

from nothing, it’s quite different to selling a publicly-quoted business where there are lots of external investors,” Mucklow says. “There is much more emotion involved.” That in itself made it a little easier to turn down a nine-figure offer. “For me, it’s about growing a world-class business that is going to create a bit of wow factor,” he adds. “The money is just a measure of success and that’s why we can walk away from a large number.” Mucklow is now focused on cracking America, which will involve giving away some equity. “We only have a token presence over there,” says Mucklow. “To really accelerate our growth, we need someone that can get us where we want to be more quickly than doing it the hard way.” If all goes to plan, Mucklow and Turner should be looking at an even more attractive offer down the line. “We have set the objective of doubling our EBITDA,” says Mucklow. “If we can do that in three years, there is a very good chance we will be able to double the value of the business.” 38


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Investing in growth - what are the options for small businesses? Traditionally, small businesses looking for help with funding would have relied on banks for loans. However, with access to bank finance still a potential challenge for many SMEs, increasing numbers of business owners are now looking for other avenues to access funding Independent finance providers offer a range of funding solutions, many of which are quite different to traditional bank funding options, helping businesses to finance growth while maintaining control of their cash flow. Investing in your business, whether to cover the cost of staff training, refurbishments or to purchase up-todate IT equipment, can be fundamental in supporting growth. It also needs to balance with any other costs involved in running your business. This means that having access to the right funding is essential for any business looking to expand or improve its services. Bank lending is no longer the only option available to small businesses. In some cases, SMEs have found their overdrafts to be significantly reduced or completely withdrawn by their banks. Recent research conducted by Funding Options suggests a reduction of 40% (£8.2bn) since 2011, a trend that has encouraged many SMEs to look elsewhere for assistance in financing key investment and expenditure. As one of the UK’s biggest independent finance providers to SMEs, LDF has been working with small businesses for over 30 years, helping to provide them with the finance they need to grow and thrive, whilst enabling them to balance the everyday costs of running 40

their business with their plans for growth. To support this, it regularly surveys its customers to ensure it is able to provide the most suitable solutions. Technology is changing all the time, making investment in up-to-date software and IT infrastructure to keep businesses ahead of the curve essential. It can however be an expensive undertaking for small businesses. Outdated systems and equipment can slow down productivity and essentially decrease the quality of work produced. Introducing more capable systems, whilst costly, will likely have a positive and substantial impact on the business. Finance can be a convenient and flexible method of purchase, allowing businesses to cover the cost of updating and purchasing new software over a maximum five-year term. Developing a business can also mean more than just purchasing assets such as computers or software equipment. For many SMEs, funding may be required to cover softer costs too. These might range from expenses, including staff training and recruitment, website and marketing costs, to research and development, all of which are essential for creating a successful, thriving business.


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LDF’s recently launched Business Development Loan helps to address this need with a facility designed to support business growth through providing financial support for investment in these areas, spreading the cost of investment over a maximum three-year term. Investment in delivering the best working environment possible for both clients and employees is also a key consideration. Modern and fresh spaces can make your business seem more appealing to prospective clients and customers – and a good working environment can have a positive effect on your employees. Many SMEs, especially those that are just starting out, can struggle to manage the costs of refurbishments and often opt to delay such outlay until the business is better established. An LDF development loan is an excellent way of advancing the funds required to enhance premises, helping businesses to realise the benefits of creating the right environment. There are many other ways in which a business can look to expand and enhance its offering. However, general running costs combined with tax and VAT bills can often cause an obstacle. LDF offers solutions to help spread the cost of these recurring expenses, allowing small businesses to cover the cost of essential expenditure, whilst helping to free up cash for investment in other areas of their business. As VAT payments are paid on invoiced work rather than bills, companies may have to make VAT payments before they have been paid by their clients for the work they

Bank lending is no longer the only option available to small businesses

have done. It is covering shortfalls like this that can add pressure to cash flow, especially where funds have not been allocated to cover such costs. Although corporation tax bills are more predictable – they come once a year – small businesses will often need to hold back on other investment plans in order to budget for the annual tax bill. This is especially true for businesses such as hotels that will often rely on seasonal trade. By spreading the cost, businesses are able to take advantage of paying smaller amounts each month without having to worry about a large bill at the end of the year. LDF knows the challenges that small business owners can face when looking to improve and expand their business. It provides a variety of finance options that can help SMEs modernise their facilities and invest in software and staff, while making sure their cash flow isn’t affected. For more information and to see what other products LDF offer call 01244 527300, make an enquiry or visit our website APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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Sa r a h Wo o d

Six months after its £114m acquisition by News Corp, things have never looked better for Unruly, the social-video company founded by Sarah Wood, Scott Button and Matthew Cooke in 2006. And while Unruly’s tech credentials might have been the dominant factor behind Rupert Murdoch’s decision to splash the cash on the Shoreditch startup, Wood’s effervescent personality probably went a long way to helping seal the deal. Meeting Unruly’s CEO in the flesh, it’s hard not to be struck by her accommodating nature and positive perspective on the travails of running a global tech firm. “I have just always loved working,” she says. The daughter of a teacher and trade unionist, Wood moved to Brighton from the north-east at the age of ten. Her early jobs included egg-packing, dog-walking, car-washing and waitressing. “I also got a job making pancakes on Brighton Pier,” she smiles. But despite the success of her current venture, business ownership wasn’t on the agenda back then. “When I was growing up, entrepreneurship wasn’t really seen as an option,” says Woods. “People used to think about being a teacher, a dentist, a doctor or a lawyer. There was a more prescribed approach to the careers that teenagers should be taking.”


You could say it was a blessing in disguise as Wood went on to enjoy an academic career that saw her pick up a BA in English and an MPhil in American literature at Cambridge, followed by a PhD in early American literature at UCL. This was interspersed with numerous gap years. “I am really open to new experiences,” says Wood. “That’s not unusual for entrepreneurs.” And Wood’s passion for academia didn’t end when she graduated: in 2004, she took a job as an American Literature lecturer at the University of Sussex. “In one respect being an academic is a great career because you are constantly exposed to new ideas,” she says. However, by the end of 2005, she was struggling with the commute from London, where she had settled down and had two kids with her husband and Unruly co-founder Button. “Every week I had to leave my children and that broke my heart,” she says. Such was her love of trying out new things, Wood also felt it was time to take a break from academia. “As an academic I feel that you are sometimes locked in ivory towers,” she adds. “I have always enjoyed coming down from those ivory towers and going out into the real world.” Living with Button had gotten Wood familiar with the world of digital advertising. In October 2003, her husband led a management buy-in at Connextra, an ad-serving and analytics startup. And it was here that he met Cooke, Unruly’s third co-founder. Coming shortly before the launch of Facebook, the social web was still in its infancy at this point. But Wood, Button and Cooke had already recognised the potential it had. “We got a big kick out of watching the internet shift from being an information highway to being a connected tissue where people could share ideas, post their own content and like each other’s content,” says Wood. Their first attempt at tapping into the social space was, which invited people to upload jokes and videos that could then be shared by other users. While it wasn’t the most solid of business propositions, it


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gave the trio some invaluable insights. “It was disastrous in terms of building an audience but what we did find was that video content was the stickiest,” says Wood. “It was getting the most engagement; the most shares.” By that time, everyone was hooked on YouTube, which had launched in February 2005. However, Wood and her co-founders were already ahead of the curve in seeing the value of virality. “Everyone was focused on views – or ‘hits’ as they used to be called – but we could see even back then that it was a nonsense figure because brands could pay for views,” says Wood. “A share is far more valuable than a view because if somebody shares your content, it means they are engaged with it and prepared to put their emotional brand behind it.” And it was this that informed their second project: the Viral Video Chart. While ranking the internet’s most shared videos didn’t appear to offer much in the way of commercial

When I was growing up, entrepreneurship wasn’t really seen as an option potential, Unruly’s founders soon realised they had created something of real interest to a number of the world’s biggest brands. “We had lots of brands and agencies coming to us and asking how to get their video on the viral video chart,” says Wood. “They wanted to know how their video could be seen by more people.” The next step was to build a distribution platform that would see brands’ video content streamed on the sites of online publishers. In return, those publishers would be paid whenever somebody viewed it. Building the platform would require a serious injection of capital, which presented itself when Button sold Connextra to BetGenius for a cool £1.7m. It also necessitated the

appointment of Tim Pickles to work alongside Cooke as a senior developer. “Our first hire was a tech hire because we wanted a pair of developers,” says Wood. “If you just have one person understanding a code base, it can be a real brake on growth if that person leaves, is sick or on holiday. Working in pairs is critical to Unruly methodology.” Within weeks of launching the platform, Unruly had signed up dozens of brands and publishers and it wasn’t long before the company had opened offices in France, Stockholm and New York. However, by mid-2011, it was evident that Unruly could only grow so quickly under its own steam. “We had all this data on how and why people were viewing and sharing video but we weren’t able to productise it because we didn’t have the engineering resources,” says Wood. Also keen to ramp up its international growth, the company raised $25m in a Series A round. “It gave us the money to diversify, make use of our data products and grow our global footprint,” she adds. And a year later, Unruly unveiled the product that truly brought it to the world’s attention. “ShareRank was the product that everybody said was impossible,” says Wood. “And that’s why we built it.” Put simply, ShareRank can predict how shareable a brand’s viral ad will be prior to launch. This prediction is based on the vast array of data that Unruly has managed to amass since first launching the Viral Video Chart. “Back in 2007 and 2008, everyone was saying viral is a black swan, black arts, bolt of lightning, black box – all of those phrases that suggested it was something unknowable and unpredictable,” says Wood. “But by 2012, we had academics decoding our database who had started to disentangle the different variables that drove virality.” APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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With this treasure chest of data at its disposal, Unruly was able to further enhance its ad-serving platform; allowing it to target a video at the people who are most likely to share it, while delivering it in a range of user-friendly formats. “All of our formats are non-interruptive, non-invasive and usercontrolled,” says Woods. “It’s about creating a balanced ad economy where the consumer isn’t forced to watch ads that they have no interest in.” Such was the height of Unruly’s stock – it now lists over 90% of Ad Age 100 marketers among its clients – it was only a matter of time before potential buyers came knocking. Having met News Corp’s chief data scientist Rachel Schutt at Web Summit, Wood had already identified the media giant as a company she’d like to work with. “We were together on stage talking about data, content and the importance of marrying the two,” she explains. “I came away from the conversation thinking: ‘Wow, we really should be working with News.’”

SHARERANK WAS THE PRODUCT THAT EVERYBODY SAID WAS IMPOSSIBLE. AND THAT’S WHY WE BUILT IT But it was only when Rebekah Brooks paid a visit to Unruly HQ that the idea of an acquisition was first floated. “That’s when we first started talking about a more strategic partnership,” says Wood. Despite the controversy surrounding Brooks – who was reinstated as CEO of News UK in September 2015, a year after being cleared of all charges in the phone-hacking scandal – there was an immediate chemistry with the Unruly founders. “We really hit it off,” says Wood. “She was very focused on digital transformation and the importance of video.” In the end, the deal was a no-brainer. “We could see immediately that we were going to be able to deliver even better campaigns for advertisers,” says Wood. It also helped Unruly hook up with other publishers – something that Wood wasn’t necessarily expecting. “We were really surprised by the camaraderie of the publishing world,” she adds. But, more than anything, it was just reward for a decade of hard graft by Unruly’s founders, employees and investors. “Having an exit event like this was a really good opportunity for everybody to be rewarded for all the work we have put in over so many years.” A couple of weeks after the acquisition, Unruly launched its In-Article ad format and, just last month, it unveiled its latest innovation: Unruly Pulse. “This shows how different brands are using emotions to drive engagement with their content,”



says Wood. “We are always looking for new ways to innovate” It’s clear that being part of News Corp hasn’t robbed Unruly of its startup spirit – the company’s HQ has retained the obligatory beanbags and Ping-Pong table. However, recruitment is more of a challenge than it once was. “In the early days we attracted a very different type of person,” says Wood. “When you’re a larger company, you attract people who want to have breakfasts laid on for them. Our challenge now is to weed out those people and bring in the people who really care about this industry.” Yet as one of Tech City’s biggest success stories, Unruly is now in a positon to give something back to the startup community. Nestled within the walls of the company’s offices is Unruly Hive, a co-working space that gives fledgling tech startups a chance to bounce ideas of each other and enjoy access to Unruly’s expertise and clients. The company also plays host to City Unrulyversity, a pop-up university run in partnership with City University that brings academics and entrepreneurs together to help inspire the next generation of business stars. And with multiple awards to her name, Wood is a regular fixture on speaker line-ups events around the world. It gives her a chance to address subjects ranging from the future of online video to the challenges facing women in tech. She believes the main thing holding female entrepreneurs back is a lack of confidence but adds that companies can help by handing more senior positions to women. “We have a lot of senior women in our business and that’s what’s powerful,” says Wood. “Just one woman at the top – that looks like tokenism.” Wood’s love of academia hasn’t dissipated either: since 2012, she’s been lecturing students at Cambridge about online video culture. “I think of myself as an accidental entrepreneur and serial academic,” she laughs.












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TOP VLOGS With some vloggers bringing in audiences of millions, few brands can afford to ignore the opportunities partnering with a YouTube star can bring BY JOSH RUSSELL


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V LO GGer s


It can hardly have escaped anyone’s attention that vlogging has become big business. Currently no end of talented vloggers are making their names on online video platforms like YouTube, with many such as Zoella and Alfie Deyes becoming celebrities in their own right and drawing in subscribers in the millions. Unsurprisingly, brands have begun to cotton on to the massive potential this has for promoting their products and services. The changing way that audiences are consuming media is part of the reason why partnering with vloggers has become such a vital avenue for brands. “Millennials are very hard to reach: they don’t watch TV, they don’t use traditional media as such, so they’re very hard for brands to find,” says Paola Marinone, co-founder and CEO of BuzzMyVideos, the multichannel vlogger network. The changing media landscape has meant that brands have been forced to go where audiences are going: in an age where online video is coming to dominate, forming relationships with the medium’s superstars has become something of a no-brainer. But it’s not all just a question of reach; utilising vloggers’ talents can also lead to much greater sales. Marinone refers to research conducted by the company that revealed 47% of users are more likely to investigate a product they’ve seen in an online video, whilst 52% are more likely to purchase it. “The conversion rates for products that have been shown in online videos is extremely high,” Marinone says. “They are much higher than any other means of communication.” One explanation for this is that vloggers have an asset at their disposal that few other mediums have: an inbuilt community of highly engaged followers. “Audiences place a premium on what these vloggers say and the recommendations that they make,” says James Stafford, senior vice president Europe at StyleHaul, the multichannel vlogger network. Traditionally, the focus in verticals like fashion and beauty has been on selling an ideal

Audiences place a premium on what these vloggers say and the recommendations that they make James Stafford, StyleHaul


or an aspiration by highlighting the difference between models and the general public. But vloggers catering to these industries are thriving precisely because their audiences can easily identify with them. “The influencer making that content is revealing not just their taste in clothing and fashion but they’re also opening up their lives to people,” he says. “It’s a much more conversational thing.” Evidently there are clear benefits to working with vloggers but this doesn’t mean that brands can afford to charge in with little thought or preparation. In the early days of the medium, many marketers would pay a famous vlogger a small fortune to namedrop their brand. “There was no strategy, measurement or framework around whether it actually did anything for them,” Stafford says. Fortunately, the industry has since matured a great deal and it has become much easier to formulate and analyse the success of a strategy. “It’s a far more sophisticated market,” he says. “The way in which you identify, execute and measure a vlogger partnership looks exactly as it would for any other media choice.”


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The audience needs to know if something has been paid for by a brand; that’s rule number one Paola Marinone, BuzzMyVideos

Rather than purely aiming for vloggers with the largest reach, the key to running truly successful campaigns comes down to inquiring how the nature of their audience aligns with the brand’s goals. “Brands need to ask themselves: ‘Does this channel reach the desired target audience by age, gender, demographic and location?’” Stafford says. Drilling down a layer, the next step is identifying what proportion of this target audience has an affinity with a certain company’s product; this can be done by assessing the brands they typically engage with. And then, perhaps most importantly, startups need to look at how likely that audience is to share videos with others in their networks. “That’s absolutely the holy grail,” says Stafford. However, finding the right vlogger to work with is only half the battle: perhaps more important is how a marketer keeps them on board and rewards them for their work. “Most people accept now that this is their career; they’ve built up a very sizeable audience and they deserve to be compensated for their work,” Stafford says. But financial remuneration is only the bluntest tool in a marketer’s arsenal. They should also be looking to add value to the relationship by offering vloggers resources that might otherwise be beyond their reach, whether that’s backstage passes to events or giving them access to a high-end production suite. “It’s about providing them the tools to create something that they couldn’t on their own,” Stafford says. Additionally, if a brand wants to build a long-term relationship with a vlogger – not to mention secure the best results – it’s important to recognise the value of their creative input. “Many companies start out with a need for absolute control, thinking it must be pixel perfect and scripted in the same way all their other communication is,” says Stafford. But one of the real strengths of working with a vlogger is having access to their knowledge of the medium. By ceding a little of their editorial control, brands can ultimately achieve much better results. “Brands are becoming much more collaborative and relinquishing some of the control over how the videos are created,” he says. “That’s where the absolutely perfect content comes from.” But whilst it’s a good idea to craft a paid vlog as editorial

content, this doesn’t mean that marketers or vloggers can afford to gloss over the commercial nature of the relationship. “The audience needs to know if something has been paid for by a brand,” says Marinone. “That’s rule number one.” Not only has the ASA previously banned campaigns that have failed to properly disclose commercial relationships but trying to dupe audiences can backfire massively, alienating them from both influencer and brand. Conversely, being upfront and honest about the nature of the content costs brands nothing. “If the audience knows that the video is paid for but can see the creator genuinely believes in the product, then it still proves really effective,” Marinone says. Ultimately, as long it is done with authenticity and transparency, partnering with vloggers to promote products can pay real dividends. And, given the fact that media landscape is evolving rapidly, there’s no time like the present. “There’s such a huge space to innovate, which means brands that embrace vlogging can actually get more of a first-mover advantage,” says Marinone. “The revolution is here and it is now.”


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What is in it for you? • Expert support and advice in Sales, Marketing, Finance, Technology, Legal and People • Networking opportunities with some of the UK’s best startups • The Pitch Watercooler: an invite only Facebook group for entrepreneurs to share ideas, discuss challenges and discover inspirational ideas • Exposure and profiling for your small business with national reach - get column inches as we shout about all the businesses involved in the competition • Gain confidence and validation from small business experts, investors and your peers • Prizes for everyone! If the unique and tailored business advice, coaching and support isn’t enough on its own, everyone who enters gets the chance to become overall Pitch Champion 2016 How it works Now Submit your initial only takes about 20 minutes. Once entries close on 25th May our panel of expert judges will shortlist 250 contestants to join us at The Pitch Boot Camps across the country.

June Time to ‘Level up’! Strengthen knowledge, skills and experience by working with experts and within handselected peer groups. You will gain moneycan’t-buy insight, advice and guidance, which can be applied at any stage of startup. Access this exclusive programme of marketing, sales, finance, people and legal.

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Amazing things Pitch Finalists have gone on to achieve Latest Free Stuff 2015 Deepak Tailor from Latest Free Stuff faced the Dragons and won. Leaving the den victorious and now working with Deborah Meadon to expand and work with big international brands. Night Zookeeper Pitch finalist in 2014 and now a BAFTA award nominee in recognition for their ability to inspire children to write. Over 500,000 children have taken part either on or offline. Bio-bean 2013 Pitch Champion Arthur Kay went on to win multiple awards for his sustainable business recycling coffee grounds. Bio-bean are frequently featured in national press and recently picked up the Sustainable Innovation Award. Cyclehoop Ltd 2009’s competition was won by London based Anthony Lau, who wowed the crowds with Cyclehoop, an innovative cycle rack that clips onto street furniture. Cyclehoop now has a dedicated Cycle Hub in London’s Paddington Station and councils across the capital. So as you sit down at your laptop this weekend, why not take half an hour before you get stuck in to make a brilliant business decision - enter The Pitch 2016 Enter now for free at! @The_Pitch

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Beneath a steel sky



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With increasing access to data and sensors being embedded throughout cities, the way we live in the urban environment is set to change forever BY JOSH RUSSELL

For a long time, science fiction has been telling us that, rather than being concrete jungles, the cities of the future will be datadriven marvels. Whilst this may have seemed farfetched just a few decades ago, changes in technology have meant that this utopian vision is now becoming a reality. Quite simply, it is hard to overestimate the potential of smart cities. There isn’t one single definition of what makes a city smart. However, most smart-cities innovations are driving toward the same aim. “A smart city is one in which technology is used to improve life for its inhabitants,” says Laurence Kemball-Cook, the founder and CEO of Pavegen, the producer of flooring that generates energy from footsteps. From giving city-dwellers access to data on pollution levels to optimising public transport, embedding innovative tech into the infrastructure of a city allows for all manner of incremental improvements to the urban environment. “A smart city offers seamless mobility, easy

navigation and utilises wireless sensor networks to increase citizens’ quality of life,” he says. And this is something that is becoming increasingly important in modern times. “Many urban centres around the world are growing in leaps and bounds,” says Russ Shaw, founder of Tech London Advocates, the organisation that promotes and champions London’s tech industry. “Many of these cities are only going to get larger as we continue to see people moving from more rural areas.” Over the next 15 to 20 years, the population of London is set to grow from 8.5 million to ten million. And this is already dwarfed by many cities in east and south-east Asia: Shanghai is currently home to 24.3 million people and there are many major cities in the region that aren’t far behind. “That puts a lot of pressure on many aspects of living there,” adds Shaw. Because of this, being smarter about the way we structure our cities isn’t just desirable: it’s a necessity.


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Sm a rt c i t i es

One factor that has certainly helped smart cities become more of a reality is the ubiquity of cost-effective sensor technology. “You now have very cheap, throwaway sensors,” says Yodit Stanton, founder and CEO of, the real-time data exchange for the internet of things (IoT). When one considers the scale of the issues you are trying to solve, even a fairly modest rollout could require a network of 10,000 sensors; back when these costed £100 a piece, any smart cities technology would have been out of the reach of all but the largest corporates. “But once you’ve got them down to a pound each, the potential is endless,” she adds. Another factor driving the boom in smart cities technology is the meteoric rise of big data and an increasing interest in open-data ecosystems. “For example, TfL opening up its data has made it much easier to create applications that improve the way people move in cities,” Kemball-Cook


Many urban centres are growing in leaps and bounds; that puts a lot of pressure on many aspects of living there Russ Shaw, Tech London Advocates

says. Coupled with the information gleaned from sensors and the enormous amount of social data that Londoners are creating on a daily basis, this means those developing smart-cities solutions have an incredibly rich data palette to work with. “Using big data will allow us to be much more efficient in how we construct and develop our cities,” Kemball-Cook adds. Certainly unlocking greater efficiencies for their populations is one of the great benefits of cities embracing smart tech. “Analysing traffic patterns, the way zoning gets done, how people move and flow; these are all things that

are going to keep our cities moving, keep them fresh, keep them dynamic,” says Shaw. However, smart-cities technology can do more than just optimise our existing assets: Singapore, for example, has created multipurpose green spaces on top of its skyscrapers that boost energy efficiency, help with water recycling, provide opportunities for urban agriculture and offer more recreation space for citizens. “There are some really good solutions out there that we should be embracing in the UK,” he says. But if cities are to truly to make the most of these solutions, it will be essential to end the ring-fencing of individual elements of urban infrastructure. “City and national governments need to break down these silos, enable open planning and make sure that people are coming together,” Shaw says. Fortunately, this is something politicians are waking up to. Shaw makes reference to a chapter of The Silo Effect, the recent book by Gillian Tett, US managing editor of the Financial Times, which concerns Mayor Bloomberg’s work in breaking down the silos surrounding the New York Fire Department and his focus on encouraging the sharing of data between it and other agencies. “We’re starting to unlock things together, work collaboratively and not feel threatened by each other,” says Shaw. And, thanks in part to the cheap availability of sensors, smart cities projects don’t necessarily have to be dictated by city hall, with plenty of activity in the space being driven at the community level. “Smart cities don’t need to be very large, top-heavy, top-down deployments,” says Stanton. In 2015, facilitated a project that was focused on air quality


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Sm a rt c i ti es

and noise around Heathrow Airport. Given this is something that is deeply important to the residents of that community, it volunteered its time and came together to place sensors around the neighbourhood. “Anyone can quickly connect a sensor, meaning people can create the projects that they’re interested in,” she says. Perhaps inevitably, the fact it’s so easy to use sensors and data to start conducting these kinds of experiments has made the sector a fertile ground for quick-moving startups. “Startups are the only way that global cities are going to be able to adopt a new smart approach,” Kemball-Cook says. Given they have much slower innovation cycles, it’s harder for corporates to run the kinds of rapid iterative experiments done by their small counterparts. This means startups have a pivotal role to play in driving the sector forward. “You need disruptors in the market to facilitate this,” he adds. “It’s not possible without startups.” However, despite their pivotal role in bringing smart cities to fruition, it’s far from plain sailing for startups. First of all, compared to other high-potential verticals like fintech, there is still a relative paucity of funding available for those creating smart-cities innovations. “There are early-stage investors and VC firms investing in these companies but we definitely need more in this space,” says Shaw. Whilst plenty of firms are eager to invest in smart-cities startups, in an industry where there have thus far been comparatively few exits, it is very OpenCapacity difficult to predict how long it will take investors to see decent returns. “The return-on-investment time horizon Having studied how ubiquitous computing and IOT can influence may be longer than in other sectors,” he behaviour, there are few better placed than Gerrit Boehm to understand how smart-cities tech can help citizens. “Part of my PhD says. “That can be a limiting factor.” was about how to enhance public transport through persuasive Fortunately, even with a technologies,” he says. Not long after completing the qualification, comparatively immature investment Boehm was urged to enter a FutureRailway competition on enhancing landscape, there are still plenty of the customer experience and won with OpenCapacity, a novel smartbigger players coming together to help cities solution to train-carriage crowding. innovative startups bring their solutions OpenCapacity’s tool is the perfect example of how smart-cities to market. “There’s now a lot of support tech can use readily available data to boost efficiency for services available for startups in the form of and consumers. “We use existing data sources that are already very specialised hubs for fintech, smart available on public transport – be that weight sensors, CCTV or wifi,” cities and, in our case, geolocation Boehm explains. “And we use these sensors to identify the number data,” says Gerrit Boehm, founder and of passengers per carriage.” This is then combined with information CEO of OpenCapacity, the startup from external sources including things like weather, information on that measures and forecasts capacity sporting events and delay information. Not only can this help give on public transport. Whether it’s passengers real-time and forecasted information on how full trains and Level39’s Cognicity Hub or the Future carriages are but it can also help train operators optimise the number Cities Catapult, plenty of resources of carriages they have rolling at any given time. have emerged to advise and champion It’s still comparatively early days for OpenCapacity but already many startups operating in the sector, as well transport operators are getting in on the act; the startup already has as put them in touch with the larger three contracts pending, with two set to run live trials in the coming players that might be able to utilise and months. It also intends to bring its tech to smart cities across Europe. deploy their technology. “These people “There’s now a great demand within the industry for us to grow our can help mentor startups and guide team and cover as many train, bus and tram operators as we can,” says Boehm. them in the right direction,” he says.

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Cities around the world are doing everything they can to make sure that they’re positioned as a smart city Adizah Tejani, Level39

Paving the way Pavegen

If there was a poster child for the smart cities movement, it’s safe to say it would be Pavegen. The brainchild of industrial design engineer Laurence Kemball-Cook, Pavegen was inspired partly by his time working on a project at E.ON to develop a new type of streetlight powered by solar energy and wind. Whilst this didn’t come to fruition, it got him thinking about other untapped energy sources in the urban environment. “I thought: ‘What if we could use the energy from a footstep alone to power part of a city?’” he recalls. Pavegen’s technology replaces traditional paving slabs with tiles that generate power when people walk across them. “Every time you walk on the tile, it generates energy from each footstep,” Kemball-Cook says. “That energy can be stored within a battery, fed back into the grid and be used for real-time data.” This means that not only can Pavegen’s technology recapture some of the energy pedestrians expend when walking but it can also be used to get a granular perspective on how the public is moving around the urban environment. Unsurprisingly, this has generated some serious attention for the startup. Not only did the company draw in a $1m series B and complete a colossal £2m crowdfunding campaign last year but it is now also aiming to create a lower cost product that will help some of the world’s poorest communities embrace smart cities tech. “Our aim is to be the intelligence inside future cities,” says Kemball-Cook. “We want to make our technology available to every favela, township and slum.”

There are also things that can be done politically to help support and bolster smart-cities tech. The Mayoral Tech Manifesto 2016 – a recent joint project between Tech London Advocates, techUK and Centre for London – made recommendations about the ways in which the future mayor of London can help champion the city’s tech sector. As well as creating an open data charter and treating broadband like an essential utility, one of the manifesto’s key recommendations was the introduction of a chief digital officer, something seized upon by mayoral election frontrunners Zac Goldsmith and Sadiq Khan. “If the incoming mayor is going to appoint a chief digital officer, the smartcities agenda needs to be part of that,” says Shaw. “This will help to underpin a bigger, more dynamic smart-cities agenda for a city like London.” There’s still some way to go before the UK could see its first smart city but there are fortunately some great examples being set globally. “A lot of cities around the world are doing everything they can to make sure that they’re positioned as a smart city,” says Adizah Tejani, head of ecosystem development at Level39, which houses the Cognicity smart-cities hub. “They’re doing it from scratch, whereas we are working with an infrastructure that’s over 100 years old.” However, whilst implementing smart-cities tech will be far harder for a city like London than it is for places such as Singapore, it’s important to remember that, as one of the global hotbeds of tech innovation, the UK is hardly out for the count. “We’ll constantly be evolving,” she says. APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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Sta rt u p s k i ll s

Plotting a path




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Sta rtup s k i l l s

For many aspiring entrepreneurs, an offer to work at a tech giant would be a no-brainer. But will this really equip them with the skills they need to ensure future startup success? Entrepreneurial success stories like Google, Facebook and Twitter are a huge inspiration for those just starting out on their journeys. And it may seem as though the best way to learn from their example would be to join their ranks. But how useful is spending time at a large corporate for those with an eye to starting their own business? Having previously worked for both corporates like Sony and JP Morgan and larger startups including Qype and Songkick, Dan Rogers, now co-founder of Peakon, the real-time people analytics platform, is in a perfect position to comment on how each environment sets entrepreneurs up to run their own startups. He recalls a useful metaphor once given to him by a VC: entrepreneurs launching a new startup are effectively explorers hacking their way through a jungle without having a clear path to follow, whilst scaling a startup is like navigating along dirt tracks and optimising to find the best route. Finally, running a large-scale company is like hitting the motorway: the roadmap is well-established and the

most important thing is keeping one’s foot on the accelerator. “They’re three very different phases and they require very different skill sets,” he says. Inevitably, the fact that startups are having to blaze their own trail means that they need a suite of survival skills that their corporate cousins no longer have a use for. “In a big company, you strive towards becoming a specialist,” says Henrik Torstensson, CEO of Lifesum, the Swedish health and fitness app, and former head of premium sales at music-streaming giant Spotify. “In a startup, especially in the first few years, you need to be much more of a generalist.” Whilst entrepreneurs working in highly technical verticals like tech will undoubtedly need specialist expertise, it’s important that the founding talent in a startup has T-shaped skills that enable them to take on many different disciplines as required. “You want people that can go deep in one area but still play the field across multiple specialties,” Torstensson says. “If you’re making the journey from a big company to a small startup, that can be one of the biggest challenges.”

In a big company, you strive to be a specialist; in a startup, you need to be a generalist Henrik Torstensson, Lifesum APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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Sta rt u p s k i ll s

Building up this breadth of experience requires entrepreneurs to be prepared to constantly experiment and step out of their comfort zones. “In my opinion, the way you build a successful startup is you fail fast,” says Rogers. “You’ve just got to try a lot of things and kill them quickly if they’re not working.” With failure rates for startups at around 85%, being willing to take risks and quickly pivot when things don’t work out is essential for entrepreneurial success. “That’s the standard mode of operation for a small, agile startup,” he says. Working in a corporate environment can actually inculcate potential entrepreneurs with the opposite mindset. “At larger companies, you don’t generally stand to gain much if you stick your neck out,” says Rogers. When somebody is working in a company with tens or even hundreds of thousands of employees, innovation cycles are typically glacial and it can take up to five years to properly implement a new idea. This means that the onus is on getting it right first time and avoiding mistakes at all costs. “When you take someone from a medium-sized or a large company and put them in a startup, that’s quite hard for them to deal with,” Rogers says. “They don’t expect to fail that often so they’re like, ‘Oh my god: everything’s falling apart’.” However, that’s not to say working at a larger, more established businesses before building a startup doesn’t come with some benefits. Whilst working for Goldman Sachs might not teach you much about putting together a pitch deck or building a customer acquisition strategy, it’s a fantastic environment to learn processes that will serve a startup well much further down the line. “Larger companies tend to be well-managed, so you learn a lot about how to manage a team, manage yourself and be more efficient,” Rogers says. As a startup grows, its concerns will gradually turn to internal structuring, 64

auditing and reporting. So having some first-hand experience of how these things are best implemented can pay real dividends. “It’s very valuable experience to see a company that has transitioned through those phases,” he adds. Another potential plus of working for one of the sector’s biggest names is that it can help future entrepreneurs recognise truly gifted individuals when they are recruiting for their startup. “If you’re working in the right company, you get to see what greatness looks like,” says Torstensson. Working at Spotify, Google or Facebook means entrepreneurs will at times be rubbing shoulders with some of the best and brightest talent the tech industry has to offer. This makes it easier to assess incoming staff and recognise the best hires. “Your benchmarking of key talent becomes a lot better,” he says. “Suddenly you realise what it looks like when someone’s truly great, instead of just good.”


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Sta rtup s k i l l s

The way you build a successful startup is try a lot of things and kill them quickly if they’re not working Dan Rogers, Peakon

Contradictory though this may sound, another benefit of getting to work behind the scenes of some of these corporate giants is that it can actually help humanise their achievements. “We tend to put people in companies like JP Morgan and Google on a pedestal,” Rogers says. “But when you go and work for those companies you realise that everyone’s mortal.” Being able to see that these businesses have been built by ordinary people can help entrepreneurs appreciate that even a sector’s brightest businesses were startups once. “It’s really empowering because you realise it’s actually achievable for you to build a similar business,” he says. However, regardless of the benefits of working for larger firms, it’s worth bearing in mind that returning from the comparatively comfortable travel of the motorway and heading out into the unknown will require some serious sacrifices. In light of this, it’s easy for a wannabe entrepreneur to stick with the relative security of the corporate environment. “Once you’ve had the

benefits of the large company, you might actually find going out into the wilderness doesn’t seem as appealing,” says Torstensson. Going from having a hefty salary, stock options and employee benefits to bootstrapping a business can be a serious shock to the system and not everyone may be willing to take the gamble. “True entrepreneurs will seek out adventure regardless but obviously this might dissuade some people from leaving,” he says. And, ultimately, this may all just come down to a question of personality. “In my experience, what tends to happen is that the people who enjoy the jungle phase don’t enjoy the later phases,” says Rogers. Effectively, if someone is more interested in being a serial entrepreneur than the next Larry Page, it probably isn’t essential to dedicate years of their lives to working in a corporate environment. “You might not still want to be the CEO by the time your startup reaches 5,000 employees,” he says. “So is the knowledge you might gain somewhere like JP Morgan vital? Probably not.” APR 2016 ELITEBUSINESSMAGAZINE.CO.UK

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V i rt ua l r ea li t y

The new reality Whether they want to conduct international meetings without leaving their desk or allow their consumers to step into someone else’s shoes, the time has come for entrepreneurs to embrace VR BY JOSH RUSSELL



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Vi rtua l re a l i t y

It’s hard to ignore the current excitement around virtual reality (VR). Whilst we’ve seen undue hype around the medium before – in the form of the failed Nintendo console Virtual Boy and some execrable early 1990s cinema – vast steps forward in the technology have meant that VR is set to become the next big thing for innovationhungry consumers. Yet despite the buzz surrounding VR, it’s important to recognise that it’s still very early days for the technology. “It’s very much a product for early adopters,” says Henry Stuart, co-founder and CEO of Visualise, the VR agency. The sector’s heaviest hitters, the Oculus Rift and HTC Vive, have only just hit the shelves and Gavin Fox, Framestore come with hefty price tags of £499 and £689 respectively. Coupled with the cost of a highend PC, this will certainly put off the casual user. However, with the PlayStation VR being released later this year at a comparatively pocket-friendly £349, it seems likely it will only be a matter of time before increasing numbers of consumers are embracing VR. “That’s really going to break down the barriers to entry,” he says. Certainly in the early days of VR, it seems gaming will be driving adoption. “VR gaming is a really amazing experience,” says Stuart. “You can’t compare it to anything else.” But gaming applications will just be the thin end of the wedge. Once products like the Rift or Playstation VR

are in people’s homes, immersive content in the form of TV and films is set to become much more commonplace. Sky recently announced the creation of a VR studio and it seems likely that, given the potential of the medium, many others will follow suit. “There’s a whole world to be explored in terms of storytelling and entertainment,” Stuart says. Potentially more revolutionary than its impact on gamers and cinema-goers will be the effect that VR has on the way we communicate. “Everyone perceives VR as being very isolating but the beauty of the technology is that it will actually become a great social enabler,” says Stuart. Indeed, social platforms are already betting big on the technology: not only did Facebook pay a cool $2bn for Oculus way back in 2014 but it also recently formed a social VR team to explore how people can ‘connect and share’ in VR. “They want to produce this platform where people can meet, share and enjoy things from anywhere in the world,” he says. And it’s not only consumers that could benefit from the potential of VR as a communication tool – being able to connect via virtual presences could have some interesting ramifications for businesses. “In five or ten years’ time, I could be doing meetings without having to leave my desk and yet still feel like I’ve met these people face-toface,” Stuart says. Particularly for startups trying to expand across timezones, meetings that bring attendees together in a virtual workspace could create far more cohesion between international departments and shatter the sense of separation between global offices. As well as being a useful tool for looking your transatlantic colleagues in the eye, VR also means startups won’t need to take half a day out of the office to check out real estate. “When small businesses are looking at new venues or offices, they’ll be able to view these spaces in VR,” says Gavin Fox, creative director at Framestore, the creative studio that specialises in VR. Similarly, VR can be an effective design tool in threedimensional spaces, allowing businesses to plan out spaces from an internal vantage point. “When it’s done properly, VR better enables someone to understand the geometry of a space,” he adds. Being able to transport the user to a different space also makes VR a potentially useful mechanism for companies looking to engage new audiences. One example is a recent experience that Framestore put together for the footwear brand Merrell. Leading consumers along a

VR offers a way to literally experience a different lifestyle


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V i rt ua l r ea li t y

virtual mountainside, VR helped highlight the innovative nature of Merrell’s new product while communicating the experience of using Merrell’s footware. In Fox‘s mind, this kind of blending of message and medium is a perfect application of VR. “Most brands advertise how a product will change your life,” he says. “That’s a very good way of thinking about VR: it offers a way to literally experience a different lifestyle.” But VR’s ability to put users in someone else’s shoes can have more profound applications than this. “We’ve been using VR to show the work that Médecins Sans Frontières is doing to help refugees around the world,” says Stuart. From documenting the factors causing people to flee their home countries to revealing the work the charity does treating the sick in refugee camps, VR offers a first-hand perspective of refugees’ struggles that no other format could provide. “It feels like you’re there,” he says. “You have empathy for them and an emotional connection that you get from no other medium.” Clearly VR has enormous potential to revolutionise the way companies communicate, both internally and externally. But this doesn’t mean that there aren’t still ways the technology can be refined and improved upon. One way that the effectiveness of VR can be boosted is by deepening the sense of presence users get when they’re using it. “Presence is when you make the experience so good that people actually believe they’re there, even if only fleetingly,” says Stuart. “They’re lost in the moment.” Not only is the development of VR peripherals going to be a very fertile ground for innovation but it will help increase this sense of immersion; from better motion tracking to Teslasuit, a full-body haptic feedback system, many new products are being developed that will help make VR a much richer experience. “All of these things really make it very realistic,” he says.


Everyone perceives VR as being very isolating but it will actually become a great social enabler Henry Stuart, Visualise

Something else that will need to be worked out is how to make the technology safe to use in a cluttered living room. “If it’s going to work for a home audience, we need to have a better way of communicating the physical space you’re in,” says Fox. As VR experiences come to require more movement from the user, preventing whacked shins and trampled cats will become a more pressing concern. Fortunately, HTC has developed the Chaperone system to solve this very problem, using lasers and beacons to track the physical space around the user and overlay nearby objects on the screen. “It’s about making people feel like they’re still connected to the real world,” he says. Ultimately though, VR only looks like improving from here, which means there will never be a better time for startups to get involved.


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04/04/2016 16:26

W h i s t l eb low er s

Rules of

disclosure A number of whistleblowers have been castigated for acting in the public interest. But isn’t it time employers took whistleblowing more seriously? BY ADAM PESCOD


The likes of Edward Snowden and Paul Moore have put whistleblowing back in the spotlight in recent years. But it was the financial scandals of the early-1990s that really brought the subject to the public’s attention. Off the back of such high-profile events as the Barings Bank collapse, the British government passed the Public Interest Disclosure Act 1998, which was intended to protect whistleblowing employees from detrimental treatment by their employer. Prior to the law’s passing, workers who reported wrongdoing within their companies could expect a pretty hostile response. “There was a culture of picking on people who blew the whistle or categorising them as disloyal,” says Beverley Sunderland, managing director of Crossland Employment Solicitors. “Whistleblowing legislation was brought in to try and protect those who came forward and said, ‘These things should not be happening and there’s going to be a real problem if they continue.’” However, despite the name of the Act that governs whistleblowing, it wasn’t until 2013 that a public interest clause was added to the legislation. Under the original version of the Public Interest Disclosure Act, an employee could blow the whistle about a breach of their employment contract. And while workers are now generally precluded from making a claim over such matters, a recent case that’s due before the Court of Appeal in October could swing things back in the favour of employees.



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W hi stl e b low e rs

The case in question involves estate agency Chesterton Global and Mohamed Nurmohamed, a former senior sales manager at the company. Nurmohamed claims he was unfairly dismissed after disclosing financial accounts that he believed had been rearranged to result in lower commission payments for himself and 100 other high-ranked employees at the company. The Employment Appeal Tribunal found that his disclosure was in fact in the public interest, a ruling that was subsequently appealed by Chestertons. “What the court ultimately said was that, provided it affects The challenge for an employer is managing more than just one individual employee, then that complaints in a way that satisfies the should be sufficient to be in the public interest,” whistleblower while protecting the privacy of Sunderland explains. other employees. This is particularly important Of course, complaints that are unequivocally in when another employee is the subject of a the public interest – for example, those relating whistleblower’s disclosure. As Sunderland points to suspected criminal activity, environmental out, if an employer decides to take action against damage or health and safety – continue to be other employees as part of their investigation, protected by whistleblowing legislation. And one they would be in breach of the Data Protection would hope they are complaints that any rightAct by disclosing this to the original complainant. minded employer would take seriously. “If you are “You have to manage the expectations of a business owner and there is something illegal the whistleblower,” she says. Equally, if a going on in your organisation, you should want to whistleblower requests anonymity, an employer know about it,” says Sunderland. “Business owners will need to make it clear that this might not be need to look at this possible. “You have as yet another tool to to be careful about help them in running promising to keep an ethical and legal people anonymous organisation.” because you might Yet things don’t seem need them to come to be progressing that along to a disciplinary smoothly. Sunderland hearing,” she says. Beverley Sunderland, Crossland Employment Solicitors makes reference to “You might need them statistics from Public in court proceedings.” Concern at Work, With MPs recently the whistleblowing charity. “They said that 50% added to the list of prescribed persons to whom of those who called them in 2014 were either an employee can turn to raise a complaint, dismissed or forced to resign having blown the Sunderland advises that businesses offer whistle,” she says. numerous avenues to workers before they’re In large part, this stems from the fact that the forced to take matters outside the workplace. Public Interest Disclosure Act doesn’t compel “We always suggest to businesses that they give employers to have their own whistleblowing employees somewhere else to go internally if policy. This is something that Sunderland would they don’t like the outcome of the investigation,” like to see changed; yet she stresses that any she says. “This isn’t about cover up; this is about business with an eye on the law should still have it genuinely getting to the bottom of whether you’ve written into their terms of employment. “What an got a problem or not.” employer needs to do is put together some form of Ultimately, it’s about creating a culture where policy that encourages employees to come forward people feel comfortable about coming forward. if they think something is going on that shouldn’t “The main thing is to gain the trust of your be,” she says. “It clearly needs to say: ‘If you come employees,” says Sunderland. “It’s all very well forward with a genuine concern, no action will be having legislation but that’s only half the story. taken against you.’” Legislation is no good if nobody actually uses it.”

If there is something illegal going on in your organisation, you should want to know about it


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04/04/2016 14:59

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Ask Business Doctors

With over ten years’ growth and more than 40 offices in the UK, Business Doctors helps good businesses become better by providing practical support with strategy, sales, profit growth and people engagement. Des Smith, Business Doctor for Manchester East, West and Central answers some questions from the frontline


just looked at the business plan we wrote when we launched and am amazed by how different the reality is from what we expected it to be. Do you have any tips for keeping plans on track?” We have a saying at Business Doctors: “When is a plan not a plan? When it’s a business plan.” It’s a very common occurrence, so you shouldn’t feel bad if the business plan you produced at the start of your business has not played out like a symphony. The reality of being in business can be very different from the plan you produce at the outset as there are so many unknown quantities. But once you’ve been in business for a while, it’s very valuable to take the lessons you have learned on board and take an entirely fresh approach to your business plan and write it again, almost from scratch. But how do you ensure this time around that the plan will represent the reality of the business? The simple answer is to base your business plan on very real, fundamental questions rather than the kind of thing a bank would ask.


Why am I doing this? This question has nothing to do with keeping up with all of your work obligations. It’s all about the end point that you want to get to with your business. What do you want the business to look like in three years’ time? Five years’ time? Ten years’ time? If you have a clear vision of the end point, it’s easier to get your head around the things you need to do to get there.

good business. Infrastructure is just as important on sales. Working on one will lead to the other. What do your customers want? It’s time to start thinking hard about your customers. There are big questions to ask yourself and to answer carefully:

What are your customers buying from you? What do you do for them that others can’t? Are their needs and motivations changing? Are you still addressing what they want as well as ever? There are many examples out there of successful companies that have lost their way simply because they didn’t keep up with their markets and with the changing needs of their customers. Are you ready to get started? Think about the current business structure and compare it with the kind of structure that will be needed to sustain a bigger company. New systems, processes, locations and people can seem overwhelming at first but once you start to break things down everything will start to look different.

What makes your company tick? Many business owners are moved to take the plunge and launch their own venture because of a strong desire to work in a company context and environment with just the right vibe and values – somewhere they and those around them are happy to go every day and set to work. You will need to understand what’s most important by getting back to basics and being selfish for once. Being selfish is another way of saying that you need to focus temporarily on your needs and desires in order to understand them better. A happy company makes for


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Could your business use a free health check? Do you find yourself spending too much time working in your business and not on your business. If so, it may be time to take a step back and re-evaluate where you are now and where you want to be. A free business health check will help you to do this.

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decisions, the search for commercial finance is far more complex. With so many variables to consider and each lender having their own USPs and twist on how they structure facilities, it is impossible to compare solutions from different funders in the same context. Figures from the British Business Bank show the majority of businesses (57%) contact their existing lender when looking for a new facility. Although this has benefits – as they ought to know your business inside out and provide a quick lending decision – it restricts the solutions that are presented to that lender’s portfolio. Yet approaching a large number of lenders can be a timeconsuming and often fruitless exercise.

SO WHAT’S THE ANSWER? For these reasons the role of an independent finance broker has grown increasingly valuable in recent times. One phone call gives them the opportunity to get to know your business and understand your challenges to help identify the most suitable facility and funders. A good broker will help you consider the options available to your business and give you choice, adding value and making the whole process easier. And they’ll keep in touch once a facility is secured to ensure everything is running smoothly and your needs continue to be served. At Hilton-Baird Financial Solutions, we have 19 years’ experience at doing just that for businesses of all sizes. T: 0800 9774833 E: W:

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THE CRUNCH The stats that matter. And some that don’t


£1bn Size of SME funding gap


49% of SMEs cite cost as their biggest barrier to hiring apprentices

Number of FTSE 100 CEOs that come from black, Asian and ethnic minority communities

Amount available in untapped private investor finance

19% 14%

of SMEs cite time as their biggest barrier to hiring apprentices


Amount that outgoing Admiral CEO Henry Engelhardt paid to every fulltime employee from his own pocket


of employees wear pyjamas when working from home

27% 82

of managers are more comfortable discussing employees’ physical health than mental health

£19.99 Price for which entrepreneur Carl Casis been selling jars of Shoreditch air as part of a Shopify job pitch


of employees wear a onesie when working from home

Sources: Close Brothers, IW Capital, Audeliss, AXA PPP Healthcare, Hammonds Furniture

of SMEs cite red tape as their biggest barrier to hiring apprentices


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04/04/2016 16:09



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04/04/2016 16:41

Elite Business Magazine | Issue 38  

Success has punctuated the story of Sarah Wood. Now, following its £114m acquisition by News Corp, she’s busy writing a new chapter for Unru...

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