SFU Venture Meet Up Video

Here is a talk I gave last fall (2009) at SFU's SIFE Club. They have a series of Venture Meetup talks and I happened to be one of the guest speakers.

http://www.youtube.com/watch?v=XmUxTdzQxsU

Below are two links :

SIFE: http://www.sifesimonfraser.com/

Venture Connection : http://ventureconnection.sfu.ca/index.php?

One Wild Year

It’s been just over a year since I graduated from UBC and I’ve managed to do a billion different things learning along the way. Since starting EasyPlug I have realized that small businesses are extremely challenging and not for the faint of heart. The scholarly business plan will take you longer to write than it will survive once things take off. The exercise of writing the plan I believe is still useful because it forces the entrepreneur to contemplate potential outcomes. My main realization though other than knowing your market (previous post) was come in prepared financially. As a recent graduate team we all had no cash to input other than our student competition winnings (11 grand) which meant working part-time jobs. Co-founders worked as research assistants, dump truck drivers and bank tellers. Then there was myself, the unemployed member perpetually searching for a p/t job that allowed me to balance company work. I quickly realized that applying for minimum wage jobs with a business degree is not looked upon favorably. From my perspective I was a value buy, smart, well educated and willing to work for a low wage to meet my other commitments. To the interviewer I was simply someone looking for a short term gig forcing them to continue recruiting once I quit due to my company taking up increased time or failing forcing me to find a professional job.

Over the span of 3 months I must have had 10 interviews as a Fitness Receptionist, Harbour authority labourer, Nike retail, bank teller, audio stereo sales, and assistant diamond sales. Near the end I contemplated removing my “graduated” line on my resume and telling the employers that I was still a student. So I decided to get creative and rebrand myself as a consultant, quickly firing off the information online to form a sole proprietorship. I figured with a Business degree, several successful competitions under my belt what have I got to lose? The answer it turns out was a significant amount of time. I found 1 individual on Craigslist looking for a business plan writer in the fashion industry, one interview later I received an e-mail stating that she’d placed an unpaid intern in the position but I was willing to be her assistant during set hours for 500 dollars. The position went from a creative job to an 8 dollar an hour research project babysitting someone that wasn’t familiar with business plan writing. I promptly replied that she was severely underestimating my skills and unfortunately I couldn’t take the position. The designer seemed unfazed as she was busy flying to Italy the following week, it continues to amaze me how some people run their businesses with such little regard for the business itself! My main lesson here was that I was truthful stating that I wasn’t busy working a real job and was looking for side projects, the designer assumed I was desperate and tried to offer me a terrible deal. In negotiation I now plan on presenting myself so that my time and skills will reflect an adequate contract.

In the end I did receive a contract with a local media company and worked significantly on the project developing the plan. After starting EasyPlug I understood the importance of a business plan from a founder’s perspective, and believe that the research is critical. In this case the editorial content came before the business plan and I was left in the dark working away lacking both sales and accounting records. With this project I had prepared a short 1 page contract that had a couple of tasks and payment dates. My main mistake in this situation was not clarifying my time allocation to the project, and expectations for both sides. I had assumed for my compensation level I would attend a monthly meeting for 5 months, receive the company’s goals and information then complete the project. I had also agreed to provide advice, and this is where the problems occurred, I felt this was more of a bonus as the main part of the contract lay in the business plan but in the end the company neglected the business plan. They felt that my availability and advice was paramount to the entire deal. Meanwhile as I was working on the plan remotely I picked up a few 1 day jobs.

The first short contract was with a catering company that specializes in Weddings and it was a blast. Imagine serving food to 60 people that are so happy, well feed and drunk they wouldn’t dare complain. Working three weddings provided great wages and long hours allowing me to keep going with EasyPlug. Meanwhile I worked a few days for a co-founders friend on a construction site installing a load bearing wall as a labourer. Those days definitely reinforced the importance of an education as long hours moving concrete blocks in peat is not the most enjoyable experience. The life of an entrepreneur!

Soon after I traveled to Cambodia to visit my ex-girlfriend (Cambodian Business post) and came back broke to a job with NBC. I quickly realized the scale on which massive American companies operate. You are the tiniest cog in a wheel of 2500 staff for the NBC Olympics segment. The 4 month job had catered food, long hours and access to Olympics venues. Though I quickly realized that big corporations have their limitations and was happy to return my focus to EasyPlug after a long break.

Before jumping back into the Start up work I joined the Army Reserves, decided on the British Columbia Regiment. As the son of an Air Force officer I decided to pursue the officer route and I am part way through my training. I spent my summer training in Gagetown, NB for several months. Oddly enough as someone who enjoys the flexibility of small business I am having a blast in the Army.

1 year and several jobs later it is looking like EasyPlug is on its last legs and a few new doors are opening up. The founding team has decided to close the company to pursue other interests, this decision was made officially in June and I’m happy to announce that the team has landed on it’s feet with our engineers gainfully employed and Mr. Miller pursuing further studies. Currently I am on a road trip from Montreal to Vancouver and plan on job hunting upon my return. A wedding and a few days in the Rockies will be my last hurrah before the job hunt. My plan is to pursue a position in either Sales or Account Management as they are both base skills required for small companies to grow. These skills will come in handy when I start my second company when the opportunity arises. EasyPlug taught me a great deal about ingenuity, managing a team and a budget. It also developed an interest in the Tech sector and shown the importance of entrepreneurship in society. Hopefully I’ll continue to follow my interests and find great experiences while always keeping my eyes open for another great start up.

Know your Market

Over the past year EasyPlug has gone over some fundamental changes. Our original idea spawned from Apple’s magnetic technology found on their laptops. We decided to develop a product that would change the wall socket innovating in an area with great potential. We felt as our inspiration was found in the laptop market we would provide a solution for all non apple PCs. For approximately a year we fielded questions about wireless power and extended battery life, potentially limiting our growth. We worked on our business plan perfecting our pitch and winning several business awards; but there was one main problem. We weren’t talking to our customers, near the end of the year we did visit several stores asking about laptop damage only to find the problem wasn’t as large as we anticipated. How many people were tripping over their cords? Since we couldn’t build our product near the laptop end of the cord it was located near the wall socket which limited the effectiveness when someone struck the cord. After several months we decided that our real market lay in child safety. People would surely pay a premium over the small plastic pieces currently in use.

Our first focus group in child safety was a success, one participant said that he initially had plastic plugs in all sockets but they weren’t replaced when appliances were used and changed. EasyPlug provided a better technology and allowed for easy connection and disconnection, surely we had a winner. With this concept we developed a plan to enter the safety market selling our product in packages of 3 and imagined expanding in the socket market which sells millions of units annually. Our engineers designed the electronic circuit board and then the entire 1^st prototype. Unfortunately as we began to receive positive market feedback we completed a BOM (Build of Materials) which came back higher than our market would bear. This also proved difficult as our team lacked experience in mass manufacturing and our BOM reflected North American pricing although it was still several times more than our price parameters. Our product effectiveness relied on a net of products covering all wall sockets rather than just one or two wall sockets. This meant that competing with a simple plastic insert; furthermore the Canadian and American electrical codes had changed earlier that year to prevent accidental damage. Using small gates sockets would prevent electrocution if children inserted metal objects. This meant that although we had a superior technology it no longer met the market need due to price constraints and our market would be limited to retrofits in the coming years. For these reasons we decided to once again shift to one of our subsidiary markets, we were a horizontal technology looking for a home!

Mid way through our IRAP grant and over a year into the team’s existence we were changing markets once again. This time to a quick release block heater adaptor, gone were the electrical circuits and flat contacts. Replaced with a stripped down mechanical device that would be easy to manufacture and would allow for reasonable margins. As I was working another job we didn’t have time to conduct the proper market analysis while the prototype was being built so we forged ahead blindly. Then I returned to the company to find some opposition when talking to outsiders about our product. One individual stated it had been done before but most importantly many individuals felt that it wasn’t really a big need. Our device worked in the occasional case where a driver pulls out without disconnecting their block heater cord. This would prevent damage to the wall socket, block heater, car body and the extension cord. The problem was that damage doesn’t happen often; we had a “push” product and required insurance style marketing where prevention stops future damage. This spawned an idea to focus on B2B rather than B2C, throughout an entire fleet of vehicles it would be more likely to incur damage and fleet managers would be willing to pay the small fee in order to keep their vehicles on the road. Unfortunately rather than disconnecting and staying with the vehicle our device remains attached to the wall electrical cord. If it remained with the vehicle and prevented a certain amount of damage our device would pay for itself. Our potential customers are car rental companies in cold provinces although the downside is that the device is easily lost if the car drives away attached. This led to another realization; our mentor at ACETECH had experience in warehouse management and explained how some forklifts might be plugged in overnight.

So in a final push we are looking into the market need of both electric forklifts and car fleets. My advice for anyone planning on starting a company is that they should try to determine their market in advance. In reality you may change markets to attack the best possible segment but at least you’ll be a leg up if you start with a significant market need.