Start-up Ireland - The Irish Times

14,000 companies a year have been set up in Ireland since 2008. We talk to six people who established businesses during the recession with little more than a simple idea

“You have to be smart, ambitious and a little bit insane – because if you were sane, you wouldn’t be doing this.” This is the voice of Jon Bradford, managing director of Techstars – one of the world’s top start-up accelerators – speaking at a networking space for entrepreneurs called Startup Grind Dublin.

It’s in a packed basement at UCD’s Innovation Academy, opposite St. Stephen’s Green, where the walls are covered with post-it notes and scribbled equations. The crowd is a mix of people dressed in smart suits, checked shirts and bright dresses, aged from 20 to 60. Some are veteran investors and some just have an idea. What brings them together is the sense of community behind Ireland’s blossoming entrepreneurial culture.

Over 1,500 new start-ups registered with the Companies Office in July – the highest number for that month since 2007 – and a recent study by Oracle Capital Group found Ireland to be “Europe’s most entrepreneurial country”. It is estimated that 14,000 new businesses have been established per annum since 2008.

One reason is the high number of grants and funding available from both public and private sources. Initiatives like Enterprise Ireland’s New Frontiers, Telefónica’s Wayra Academy and the National Digital Research Centre’s LaunchPad programme have been nurturing ground-breaking companies, while last year alone saw a reported €70m of so-called ‘angel investment’ north and south of the border.

And it’s not just tech firms. Fifty-nine per cent of our businesses are in the retail, services or wholesale sector. Sixty per cent of them employ fewer than 10 people. Forty-two per cent of them have three or fewer employees.

 For some, the recession has created a focusing effect: people who have lost their jobs or left college to little prospects are creating their own opportunities. Innovative business ventures are being launched by groups and individuals with no experience, injecting old industries with fresh thinking.

Some believe that Ireland’s entrepreneurial culture is reaching a tipping point, that it’s on the cusp of a mainstream breakthrough. Others are concerned that ‘wantrepreneurs’ are jumping on the bandwagon, putting early stage business resources (like accelerators and incubators) under strain.

Either way, the line between start-up companies and novel business ideas is blurring, as ‘entrepreneur’ becomes an umbrella term for anyone who can spot an opportunity with growth potential. But there are far more shared qualities than just being smart, ambitious and a bit mad.

Whatever the industry, entrepreneurs tend to collaborate widely, take risks and learn from their failures. They also know better than to have business cards before a business plan. But perhaps more tellingly, the most successful ones have a way of provoking the same two reactions over and over again: “It’ll never work” and “Why didn’t I think of that?”

Dee O’Leary, iD:ME

Best advice: Crowd-source the right connections

Dee O’Leary’s business breakthrough stemmed from a moment of panic. After her son Liam wandered off from a supermarket in November 2011, she searched online for accessories to help identify lost children. Not finding one, she decided to make her own: a wristband containing emergency details like contact numbers and medical information.

“It’s easy to have an idea but the scary thing is making it real,” says O’Leary. “At the beginning, I didn’t have a business plan. I sold anything I didn’t need in order to finance it: my car, gym equipment, even the Xbox. Myself and my husband had well-paying jobs but when the economy turned, we both lost them within six months. I had our first child around the same time, so the timing couldn’t have been worse. I didn’t wake up and think, ‘I’m going to be an entrepreneur and invent something!’ I found a need for product I couldn’t find and thought, ‘Why isn’t somebody doing this?’”

O’Leary fleshed out a model of the wristband with her husband Ryan, who originally studied graphic design. Prices quoted by Irish textile companies were beyond her budget, so she turned instead to a Chinese manufacturer. But after emailing them YouTube tutorials detailing design specifics, her instructions were lost in translation: the stock was nothing like what she asked for.

“That was a real kicker,” she says. “Getting it off the ground in those first six months, going back and forth, had been painful. But you learn more from your mistakes than you do from your successes.”

Since switching factories and refining the design, O’Leary has sold over 20,000 wristbands across six continents. She has also won several awards, including Cork Innovates’ €30,000 business bursary, and is working with Cork Institute of Technology to develop a wristband with tracking capabilities.

But the biggest thrill, O’Leary says, is hearing about the peace of mind she’s helped bring to others: parents of children with Autism and Down’s Syndrome, partners of people with Alzheimer’s as well as loved-ones of cyclists and runners. In December, O’Leary will meet various industry leaders in the US in order to develop her business further, having been awarded that opportunity by the Cork Foundation.

“I had no resources to begin with so it was a case of, ‘Okay, who do I know that can help me?’” she says. “Ireland is small in the best possible way; you just have to get up off your arse and start asking. The willingness to help, share contacts and make suggestions without looking for favours back is amazing, especially within the Cork business community. All you need is one person to point you in the right direction and you could be off.”

Pat Phelan, Trustev

Best advice: Fail early and get it out of the way

Pat Phelan is home in Cork for a few days, having recently moved to New York as part of a whirlwind success. After a career in e-commerce and telecommunications, Phelan co-founded Trustev in 2012 as a platform to protect online merchants. It analyses fraud ‘fingerprints’ to accurately assess whether a customer is genuine in real time, thereby saving companies a fortune.

“All the risk sits with the seller and we thought that was a completely unbalanced model,” he says, “so we saw a huge market opportunity to come up with something game-changing.”

Last year, the European Commission named Trustev as its Top Technology Start-up. It has since raised $3.5m in seed-funding, was listed by Forbes as one of the hottest global start-ups and won the prestigious SXSW Accelerator competition.

Most of Trustev’s clients are outside Ireland, Phelan explains, and running a business in-between time zones has required enormous commitment. “I don’t have any personal life,” he says. “I have no hobbies. Friends are quick-grab phone calls. I haven’t seen my best friend in at least a year – and he lives in Cork! Everything has to be put on hold when you’re a running a company of this scale. It’s very hard, no matter what people tell you. For both myself and Chris [Kennedy, co-founder], it’s a lonely road.”

Having said that, Phelan considers himself incredibly fortunate and takes heart at the number of young Irish entrepreneurs approaching him for advice. “I’m 49 – much older than most in start-ups – and I’ve made a lot of mistakes, so I’m able to give them a bit of that experience,” he says. “But the fantastic thing is that people coming out of college today just have no fear. They’re ready to take on the world.”

Phelan often advises entrepreneurs to start in pairs: someone business-minded who can sell and someone tech-minded who can build. Three out of every four start-ups fail, according to research at Harvard Business School, but investors are often more interested in someone’s long-term potential for their portfolio rather than just a one-off project.

“I’m a big believer in failing quickly and getting it out of the way,” says Phelan. “We’ve got this attitude in Ireland where failure is a badge of shame. In the US, anything is a badge of honour. Of course, when you turn up to win something or announce you’ve raised millions, everyone thinks it’s easy. It’s not. There are people I know with great ideas who’ve struggled. I’m lucky: we’ve a big product with great investors and we’ve worked hard. But it all starts with just going for it like you’ve nothing to lose.”

Eva Milka, Gaelic Escargot

Best advice: Do the research and prove there’s a demand for your product

Eva Milka decided to start Ireland’s first snail farm after returning from a holiday in France and being unable to find escargot. Soon after, she and her partner Lucas Kurowski, a chef who’s also from Poland, decided to create their own supply. “When we started breeding snails in our one-bedroom apartment, everybody thought we’d lost our minds,” Milka says. But the more they won friends over with escargot dishes, the more they sensed an opportunity to do something different.

“When we did the research, we discovered that there was an international [escargot] shortage – especially in France, Italy and Spain – and that snail farming does not exist in Ireland, even though the conditions are ideal.”

It took around 11 months for Milka to get their business plan “investor ready”, during which time they were often reminded that Irish people don’t eat snails and that the lack of expertise would make life difficult. Still, they ploughed on. In 2011, Milka and Kurowski developed a plot of land in Garryhill, Carlow and received backing from the Carlow County Enterprise Board. The pair spent time on a Polish snail farm, learning as much as possible, and tried to implement the same system here.

But it didn’t work. The weather proved too unpredictable, forcing them to come up with their own model. “Being the first to do something is incredibly difficult, especially when you’re in a foreign country,” says Milka. “It means building everything from scratch.”

Yet as soon as they teamed up with a Polish distributor and began producing 10 tonnes of snails a year, other Irish farmers wanted to learn. Milka, who originally moved here to work in the hotel industry, had no prior experience in running a business. But she could see the value in staggering their growth strategy for the sake of sharing knowledge.

Gaelic Escargot are now developing the first manual and training programme for snail farming in Ireland. They’ve also participated in an accelerator programme with DCU’s Ryan Academy, received funding from Diageo’s Arthur Guinness Projects and struck a distribution deal with La Rousse Foods.

The work-life balance is something they’re still fine-tuning but Milka believes you have to sacrifice a lot at the start in order to achieve the right balance later, especially if it means pioneering a new industry.

“Look at the figures: there are something like 400,000 unemployed people in Ireland and 17,000 farms lying idle, so we can see a huge opportunity. We’re not doing this just for our benefit. We could begin breeding snails with other Irish farmers on a big commercial scale and make this global.”

Colin Harmon, 3FE

Best advice: Do something you enjoy, then find a way to make money from it

Colin Harmon has spent five years building 3FE Coffee into a brand with international recognition. The ethos is simple: offer a variety of the world’s best coffees, with great attention to detail, and be nice to people. But 3FE isn’t just a café on Dublin’s Grand Canal Street: it’s a wholesale supplier that holds coffee classes, prints a magazine and runs a roastery as well as a subscription coffee service.

It all started when Harmon felt unhappy working in investment funds. He quit his job, learned everything he could about coffee and became a barista champion. When he was offered some free space in Dublin’s Twisted Pepper venue during the daytime, he starting serving customers there with just a bench and machine.

“I had people coming in and saying, ‘This’ll never work. It’s unsustainable.’ If I had orders of more than four coffees, I was in ribbons. But what I was doing was building a brand: engaging customers and making sure every single cup was delicious.”

Since then, Harmon has spearheaded Ireland’s specialty coffee culture. Buzzfeed recently named 3FE as one of the ‘25 coffee shops around the world you have to see before you die’ and business has doubled since last year. Although 3FE has never borrowed money or received investment, plenty of challenges have cropped up along the way.

“It’s easy to listen to entrepreneurs talk about how great it is and how it’ll change your life but I’ve lost friends because of my business, especially in the first three years. I was working seven days a week, missing people’s birthdays and weddings, losing touch with friends I’ve known since I was little.”

Harmon likens businesses that opened in the recession to green shoots sprouting after a forest fire. He feels blessed that there’s a pool of people here who want to do cool things, work hard and learn as much as they can. And when he talks to other businesses owners around the world, they don’t seem to have that same reserve of readily available talent.

Harmon values the network of colleagues, customers and characters that 3FE has developed much more than pursuing money. His family is happy and healthy. He spends every day drinking nice coffee, eating nice food and talking to nice people. That’s something he’s reluctant to jeopardise.

“If you were to say to me, ‘You’re going to be doing this for the next 40 years and nothing will change for better or worse,’ I’d be happy with that. Liking what I do has to be central to everything. Smarter people than me have destroyed much bigger and better businesses just by overstretching.”

Cristina Luminea, ThoughtBox

Best advice: Get a mentor

Cristina Luminea was quick to recognise that children are no longer thinking or learning in linear terms. They become digitally savvy from an early age, with instant access to information, yet they are still being taught through the same traditional methods. Her idea was to adapt those methods in order to meet kids where they are and show them that learning maths and science can be fun.

Luminea, who’s from Romania, first came to Ireland as an Erasmus student at Sligo’s Institute of Technology in 2006. She went on to work at Houghton Mifflin Harcourt Learning Technology, a publishing house for educational products in Dublin. The idea of starting her own company was something she went back and forth on until September 2011, when she launched ThoughtBox: an educational software provider that teaches subjects through ‘gameful learning’.

A few days before presenting the idea to the NDRC LaunchPad, Luminea met Claire Burge, an entrepreneur who had just sold her own business, and the momentum behind ThoughtBox quickly took over.

“The first two years were just, ‘Go! Go! Go!’” she says. “To be the honest, I had a very patient boyfriend. It was a case of going to work around nine and then coming home at midnight just because that was the last train or bus home.”

ThoughtBox has since become an award-winning enterprise with games that have been downloaded in 57 countries. Luminea knew from experience that people often make the mistake of aiming their product at a market of “everybody”. By taking her idea directly into classrooms, she discovered exactly what her target audience wanted. But, even still, trying to keep the company afloat during its infancy felt unpredictable.

“There were moments of thinking, ‘This is it. We won’t be able to continue,’” she says. “But something always came through and we were lucky enough to get money every single time we needed it.”

Luminea’s best piece of advice is to get a mentor: someone with experience who understands the ups and downs of entrepreneurial life. For her, it was Christian Luedtke, a former manager who offered himself as a sounding board before big decisions.

“There’ll always be people who believe in what you do and those who don’t,” she says. “I’m very stubborn on my own terms, so I usually don’t listen. A lot of the time that’s helped but it’s worked against me as well. Quite often I wished that I’d known something in advance, and maybe I wouldn’t have taken certain decisions, but looking back I’m happy with the road we’ve been through. Even though it was fun sometimes and a struggle other times, it was all worth it.”

Conor Brady, Dogs First

Best advice: If it’s not an obsession, you’re going to fail

Conor Brady has built a business out of combating the dangers of processed food. After completing a doctorate in animal behaviour at UCD, he moved to Australia and spent four years training guide dogs. In that time, Brady’s research into canine nutrition and allergies revealed how damaging dog food could be. “I said [to my employers], ‘It’s either me or the dried food’ ...and they chose the dried food,” he says, laughing. Brady then quit his job and spent another two years developing a seminar to counteract popular misinformation surrounding dog nutrition.

But when he brought that knowledge home to Ireland, people weren’t listening. Challenging outdated beliefs among vets proved difficult, so the Wicklow man decided to engage with pet owners directly. In 2011, he launch Dogs First, a nutrition advisory service that includes Brady’s own line of fresh dog food, gRÁW. “Everything up to that point was guiding me towards this one thing,” he says. “Some people said it was madness but I knew the market would be there, even if it’s a smaller piece of the pie.”

Brady received backing from the Wicklow County Enterprise Board and appeared on Dragon’s Den, where he gained €100,000 in funding as well as valuable TV exposure. But demand stretched the capacity of the business, particularly when Brady tried to branch into different products, requiring a change of premises.

“We grew far too quickly and, while I was warned that could be a problem, I didn’t believe it. We actually had to put a halt to things for a few months to gather ourselves so that we could be bigger, better and more robust. There comes a stage with a business where you’ve got to make that leap to the next level and it’s a scary thing. I didn’t see it coming.”

There have been many other ups and downs, Brady adds, including times where falling ill could have meant imploding the business. But he has good support in place and feels happy that things are back on course. The phone calls, Facebook posts and photos from customers, relieved at their dogs’ improved health, are what kept him going.

“Fresh food makes such a difference that people would be crying on the phone to you,” he says. “I mean you put in all that time hoping to build the business up to a point where you can step away. But there are so many hard times that you have to be completely convinced about what you’re doing. Seeing dogs getting better is the whole reason I started this company in the first place.”

Brendan O’Driscoll, Soundwave

Best advice: Meet relevant figures in your industry for a coffee

In 2011, Brendan O’Driscoll saw a woman so immersed in music that she walked into a tree. He was working for a tidal technology start-up in Sweden at the time, but wondering what song that woman was listening to inspired an idea. O’Driscoll and his cousin Aidan Sliney decided to develop a music-discovery app charting what people were listening to on their smartphones and where.

When they took the concept to the NDRC LaunchPad programme, things escalated quickly. O’Driscoll sent a message to Apple co-founder Steve Wozniak on LinkedIn, asking to meet for a coffee while he was in Derry for a presentation. Wozniak was so impressed that he publicly endorsed the app, as did actor Stephen Fry. O’Driscoll also emailed US billionaire Mark Cuban, owner of the Dallas Mavericks basketball team, who agreed to invest in the start-up.

Since launching in 2013, the app has been downloaded over a million times in 190 countries, winning Google’s ‘Top Developer’ award and raising over $4m in funding. Soundwave now has a staff of 10 with offices in Dublin as well as San Francisco, but O’Driscoll says they’re still adapting.

“We’re all first-time founders so that’s obviously a big challenge,” he says. “Being kind of green means learning on the job and figuring things out five steps ahead of where we are.” Setting up something from nothing is daunting in itself, he adds, especially in an industry as difficult as music, but relishing challenges is why O’Driscoll started this business.

“From the outset, I was so eager to get involved that I threw everything at Soundwave and had very little time for family, friends or even my own health,” he says. “But over time we’ve realised that sleeping under your desk isn’t a long-term solution. I’d like to think we’ve matured in our approach and better understand the practicalities and limitations you have to face.”

The best part of Soundwave’s success, he says, has been the recognition that this is a legitimate job rather than a hobby, and that these kind of ventures can generate serious traction. O’Driscoll assures anyone pursuing a start-up to meet relevant figures in your chosen field for a coffee, as it could be a valuable opportunity to validate your idea.

“Entrepreneurs are massively collaborative in Ireland,” he says. “Ultimately, they’re not in direct competition with each other and a lot of them just want to see other Irish people succeed. That’s really powerful. There are also great systems in place now to turn a concept into an actual company. There’s never been a better time to go after your dreams and turn that night-time idea into a daytime reality.”