Interview with Ian Lucey founder of Lucey Technology
How would you characterise the Dublin tech scene? What’s your involvement?
We are heavily involved in 3 tech scenes. London, Dublin and the rest of Ireland. London is quite dispersed so it doesn’t have a natural centre like Dublin. There is a lot more money in London and a lot of the startups are very design focused as London is one of the world centres for Design.
Dublin is incredibly tight-knit with a lot of accelerators and incubators. There are events on every night of the week so it’s very easy for somebody to get to know everybody. Having a new startup commission is a huge plus for Dublin and Ireland as a whole. I really felt like the industry needed a voice so that simple changes could be made to our tax laws and general treatment of indigenous startups.
Our voice will become a lot clearer in the near future with organisations like StartUp Ireland. For me there is still a big split in Dublin between the large foreign tech companies based in Ireland and the local companies. We have yet to see many acquisitions of Irish startups by these European HQs but I think that trend will change as the foreign tech companies bed into Ireland. The rest of Ireland is behind Dublin but I have seen huge jumps forward with events like WasUP.
Are you seeing any trends in the type of start ups launching in Dublin and looking for investment?
Enterprise Ireland dominate the investment landscape for startups in Ireland. EI is an amazing facility and we are the envy of other countries. However they have made many of the traditional VCs more conservative because of how they match investments. It’s great to see new VCs like Frontline who are investing earlier and giving startups great connections to sources of money outside of Ireland.
For me it’s incredibly hard to start a consumer product in Ireland. If you need to raise a lot of money or need a lot of traction it is not the best market to launch from. That doesn’t mean Ireland is doing something wrong but just that we are a small country with limited VC finance.
I think Ireland is made for B2B focused businesses. We are great sales people. You can raise €500k-€2m relatively easily and we have Ryanair to fly us cheaply to wherever our customers may be.
What are you currently involved in?
We are investing in 15+ startups in 2014 so the list is quite varied and there are always things happening. This month for example:
We closed an investment round for www.annectouk.co.uk. We were the first investor in this company 2 years ago. They now have 150+ staff, profitable since year one and are growing their customer base by 10-15% a month.
We put MedxNote, an NDRC graduate, into its first customer. We helped build this app which is like WhatsApp for hospitals. Before we even finished building it some of the largest public and private hospitals in Ireland have agreed to take it.
One of our investments Investor Sheet, based out of Wayra launched its first version. Russell Banks started this company and it is a tool to help startups interact with their investors and to keep them informed. We will be putting this into all our client companies.
Since the Web Summit we have agreed to invest in 2 companies we met for the first time at the Summit. We ran a Twiznight competition at the Summit and it led to a lot of international startups looking for investment from us.
We did our first investment outside of the UK & I this month with a French startup called Wallbrand.
Tell us about what you do?
What I love about our job is that we demystify a lot of the crap that goes around startups. MedxNote for example was started by a radiographer who is a father of 7. He had been in NDRC but was struggling to build a team to get his idea off the ground. We created the tech spec, architected his product, built the back-end, iOS and Android app.
We also helped him raise money from angel investors in the medical community and close his first sales. We are now helping him build out his own team and finalise a larger round of investment to let him begin to sell abroad. Its great to see these guys getting their business moving because getting the snowball started is often the hardest part.
Is there a deadline for people interested in applying to Lucey Fund?
No we are always open. We love Sales Directors or people who know their industry. We then help them with their tech, marketing and finance.
There is a big debate about whether Irish startups are scaling well enough to become global players? Is there anything you think they could be doing better / differently?
Research. It amazes how many people I see give up their jobs to pursue a business but have no idea about potential international competitors. I was mentoring at startup weekend Dublin and judging at startup weekend Cork last week. A lot of the ideas were concepts I had heard before. It’s good people are trying to solve issues but its vital that startup founders learn from the experiences and mistakes of others before them.
Its natural that as the Irish Startup scene matures we will begin to see more mature and focused ideas being funded
I strongly recommend people listen to podcasts like ‘This week in Startups’ and the ‘Gilmore Gang’. The valley has so many media outlets that discuss the tech industry there. We may not always be able to afford the money or the time to go to the valley but its pretty much free to listen in to what they are talking about while sitting on the dart.
A common cycle for a startup in Ireland is to launch a consumer focused product but struggle to get huge traction. The startup then pivots just before they run out of money to a B2B model where they can partner with a large company or maybe white-label their product. This pivot reduces the cost of acquiring customers and makes the business viable.
I think as the Irish tech scene matures we will be able to launch consumer products like Spotify and use European money to grow it.
We’re starting to see some interesting tech businesses grow out of Dublin. Do they need to move to California, or can they continue to grow from Dublin / and or London?
It all depends on the business. Would Stripe have done as well in Ireland, I don’t think so. They needed large amounts of cash and influential investors that would not be as easy to come by here.
Ireland is becoming the go to destination for the top US startups to take on the rest of the world. Why would an Irish startup leave that to go to America where programmers are harder to find and everything in the world of tech is more expensive.
I think people need to stop the obsession with the Techcrunch generation where the more you raise the better your business is. We are in business to make money and to live our own lives. Most businesses don’t need and shouldn’t look to get VC money. I think founders need to look at what the true potential of what their business will be worth and work towards financing their businesses in the most efficient way possible to allow them to recoup a good return on both in monetary and personal investment.
I would say 95% of startups don’t ask the bank for a loan. Why? It would be my first port of call because I would not start a business if I was not confident I would pay back my investment. When startups do ask for loans they are approaching the bank in the wrong way. Founders must understand the motives of banks, EI, Investors, etc if they are to build good working relationships with them.
Work / life balance. How do you manage the time demands that brings, and also managing everything else?
For me 6pm-8pm is family time. If I need to do more work in the evenings then it is done after the kids go to bed. This cuts out the need we all feel to keep working instead of going home. We have an amazing office overlooking Dublin Bay. It also happens to be in my garden which makes the 50 yard commute very manageable. I used to commute into Dublin city centre every day but I found there was no need. People looking for investment come to us, the staff are happier in Blackrock and its only 12 minutes to Google or Microsoft from our office.
I see a lot of my kids and I don’t feel that I have traded that part of their young lives away in pursuit of a business. One of the joys of starting your own business is giving yourself the opportunity to cultivate the life you want to live. I’m not always brilliant at switching off from work but it’s important to try.
For our team we try to make sure that all staff get the same perks. Everybody works from home at least 1 day a week. We are flexible on office hours and we always shut down all non-essential services for 2 weeks over Christmas. We want our team to be at their kids Christmas play and not be taking time off or worrying about holiday entitlements. If a team member ever has to work late or out of office hours I will always apologise as that is their time and the extra effort is greatly appreciated.
I prefer to employ more senior and independent staff who are given goals to achieve and we trust them to do their best to surpass those goals.
Like Paul Allen, Bill Gates, and Warren Buffet, and a lot of other people who have had a number of successful ventures, they have turned to wide ranging initiatives to help humanity. What’s your own particular philosophy on this?
Lucey Social is our way of looking to contribute to society. The idea behind Lucey Social is that we can contribute more to a non-for-profit by lending our technological expertise than just cash. We do it in the same way we do our investments but the only return we want is a charity that can do so much more with the resources they have. We would love to do more of this but we don’t always get asked so we would encourage not for profits to come forward.
One of the big challenges we have faced is that quite often the not for profit sector don’t have any internal IT experience at all. This means we can revolutionise their organisations but internal staff training is critical.
Salesforce & Oracle among others have a keen interest in 1% to charitable causes? How do you determine which ones your own Lucey Social fund invests in?
We look for not for profits that want to automate the interactions they have with their community. In many cases a small technology investment can mean budgets go so much farther.
In terms of social media in general, how do you maintain the right level of engagement and deal with everything else?
Over 50% of our business comes from Twitter. We use this as a way to share the stories and opinions that interest us.
We are in the midst of writing a book (really its an extended blog) on how we see the world. We don’t see the world through the narrow view of the next big funding round and as such we feel we need a definitive guide to our views. This will allow companies looking to us for investment to decide if we all fit together well.
We hear from thousands of companies a year looking for investment. For us it’s about efficiently sorting through these to find the 20-30 companies we will hopefully invest in during 2015.
What sport do /did you play? Any thoughts on this?
All of life’s business lessons can be learned through the prism of sport.
The key ones I’ve learned so far:
- Environment & Expectations Win
I grew up playing basketball with Neptune in Cork. We were always the best. This came down to good coaching, an insistence on excellence and an expectation that you would win. Combine all 3 in business and you are giving yourself the best chance.
- Get the best advice
I spent most of my teenage years hoping to get a US golf scholarship. By the end of it all I had was a bad back. I was never going to be Rory McIlroy but I had the talent to be a good golfer. I decided to teach myself how to play. This led to many hours repeatedly teaching myself the wrong thing. Hard work is no good without working smart. I should have had a golf coach in the same way startup founders need mentors on board. This allows the founder to not spend time relearning the lessons other have already learned.
…..and don’t even get me started on founders who decide to learn to code to start their own business. Its so incredibly rare that that works out well for them.
- Use the best techniques and tools
The other big mistake is that I didn’t modernise. I’d say I was one of the last people to move from wooden drivers to metal woods. I was a silly traditionalist at too early an age and fell miles behind. If you want to succeed you must use the best tools or else you are handing the advantage to everyone else.