Investing in a Tech Start Up: The New Breed

Written by David Joland

Up until a few years ago, investing in a business was simple. I met with people whose industry knowledge, experience and past success was their credibility. They had a proven track record and a need for funding to execute their business plan that was beautifully presented in a PowerPoint.

I met them in hotel bars and pubs around the country with the occasional maverick appearing wearing chinos and an open neck shirt.

Then a new breed suddenly appeared. They wrote software in their bedrooms. They wore hoodies and trainers, and they didn’t shave. They knew nothing of business and had no financial experience and yet they had a vision to create a billion-dollar company, and all without a business plan.

I have tried to embrace this new breed. I stopped meeting in bars, saving whoever I was meeting the embarrassment of having to produce ID. Now I meet in coffee shops or a ‘shared-workspace’.

There’s no firm handshake from which I can gauge their strength of character; it’s now how bruised my knuckles are from a fist-bump. I don’t ask about their previous experience because I know they have none.

I get a brief nod, the login for the WIFI, and they’re straight into their pitch, telling me how disruptive they are – which is apparently a good thing. I listen as they tell me their idea, although it’s hard to focus with all the pinging and vibrating coming from their phone – which they’re attached to like an intravenous drip.

Just when I think I’ve heard just about every absurd idea possible, someone manages to lower the bar. I once got pitched for an app designed for people without a phone on which to download it.

I’ve heard countless ideas which I can’t tell you about – not because I’m bound by an NDA, but because I couldn’t understand their purpose or what they did. Then there are the clever ideas that actually sound credible, right up to the point when they explain they have no revenue model which is a shame because that’s what I tend to look for in a business.

When the pitch is over I offer an exchange of contact details and give them my business card, which has a phone number, a physical address and an email address. They often study it, thinking about what they’re supposed to do with it.

So, you might think anyone old enough to hold a driving license, or who’s been tainted by previous experience, has no future in tech – but you’d be wrong. In most industries, the biggest brands keep an eye on the fledgling brands, knowing that almost all of them will fail – but as soon as one of them gets close to the point of commercial viability, they’re there, lying in wait to snap them up.

It’s these big brands that are managed by professional – mature – business-minded people who wear long trousers, sleep in double beds and can buy their own alcohol. Look behind the boards of any FTSE company and you’ll see the average age is actually increasing. In the UK, the average age of an executive director is over 53and for non-executives, it’s over 60.

It might also surprise you to hear that most entrepreneurs in Silicon Valley can actually write in joined-up writing and get into adult movies without lying. That’s because the typical age they exit their tech company is 47.

So, it turns out, I shouldn’t feel old or out of touch. I’m just a regular dinosaur looking for a unicorn.

David Joland is a novelist and businessman. His debut novel, The Biggest Idea in the World, is available from Amazon, priced at £8.99 in paperback and £3.99 as an e-book. For more information see thebiggestideaintheworld.com

If you would like to have your company featured in the Irish Tech News Business Showcase, get in contact with us at Simon@IrishTechNews.ie or on Twitter: @SimonCocking