1. NEW ZEALAND’S E-MAG FOR ENTREPRENEURS AND BUSINESS OWNERS
March 2014
...plus heaps more inside!
John-Daniel
Trask
with
ofMindscape
Questions
To Make
the Phone
Ring, Put a
Value on Your
Own Time
Page 14
Page 12
Inspirational
Stories
When is
the Right
Time to
Start a
Business
Page 20
2. 2
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3. Contents
4 From the Editor
6 Flying The Flag
12 To make the phone ring, put a value on your own time
14 10 Questions with John-Daniel Trask of Mindscape
20 Lessons from the trenches - Hard learned lessons from
entrepreneurs in training
22 Tony McDonald - McDonalds-IT
24 Young Enterprise
26 Hamish Dobbie
29 Entrepreneurial Intelligence
30 Pete’s Lemonade - An Idea Inside A Bottle
32 Parting Shot
Have you subscribed
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4. 4
B
uilding a business would be so easy if we didn’t
make any mistakes. If only we could sail through
it all doing everything correctly, at exactly the
right time and by spending the minimum amount of money
possible. The reality is cruel sometimes.
Like many entrepreneurs, I’ve lost countless hours on sales
and work that didn’t make it over the line, spent thousands
of dollars on ideas and businesses that never produced any
return, encountered problems I just never saw coming and
just simply made some big mistakes.
Entrepreneurs by nature are problems solvers, and it’s how we
approach these problems that defines us, finding solutions and
answers without giving up when things become difficult. In
my view, an entrepreneur that thinks they know it all already
is a dangerous thing.
This month I’ve met many inspirational and successful
people who all share a common trait - They have all made
many mistakes and have many stories to tell, getting it wrong
sometimes is just a reality of the journey. So next time you
meet with a fellow entrepreneur, rather than talk about the
good things they’ve done, why not ask them what the biggest
mistake they have made is. You might be suprised!
Nick
Email nick@nzentrepreneur.co.nz
From
the Editor
N Z E N T R E P R E N E U R I S P R O U D LY
B R O U G H T T O YO U B Y :
ABOUT /
Short and sharp, New Zealand Entrepreneur is
a free e-magazine delivering thought provoking
and enlightening articles, industry news and
information to forward-thinking entrepreneurs.
EDITOR / Nick Harley
ART DIRECTOR / Jodi Olsson
GROUP EDITOR / Nick Harley
CHIEF FINANCIAL OFFICER / Alastair Noble
CONTENT ENQUIRIES /
Phone Richard on (09) 522 7257 or email
richardl@espiremedia.com
ADVERTISING ENQUIRIES /
Phone Richard on (09) 522 7257 or email
richardl@espiremedia.com
ADDRESS / NZ Entrepreneur, C/- Espire Media, PO Box 99758,
Newmarket, Auckland 1151, NZ
WEBSITE / nzentrepreneur.co.nz
ISSN 2253-5683
NZ Entrepreneur is a GREEN MAG created and distributed without
the use of paper so it’s environmentally friendly.
Please think before you print. Thank you!
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6. E N T R E P R E N E U R S H I P
M
y first ‘real’ job was Sales Coordinator for
Wellington headquartered marine safety company
Hutchwilco, and while in this role I completed
a BCA at Victoria University. I worked my way up the ranks
at Hutchwilco with a number of roles, ultimately focusing
on product development and production, and was a director
when we were purchased by Chemring Group, a large English
corporation with diverse global interests.
Chemring’s ownership was short lived, but brought about
a number of often demanding, but also very educational
Nexus Developments Limited is a small Wellington based design
and marketing company specialising in the development of display
hardware for the international flag and banner industry.
Flying The Flag
Here we talk to Peter Hume about how the company got started and his advice for budding entrepreneurs.
changes, including the moving of Hutchwilco’s head office to
its life jacket manufacturing facility in Auckland. My family
was keen to remain in Wellington, so instead of following
the ‘marine team’ to Auckland, in 1997 I purchased the small
flag manufacturing division Hutchwilco had been operating
out of Wellington. This operation had been one of my
responsibilities within the company, and had been trading as
‘Flagmakers’ for some years.
After ‘working for a boss’ for so long I had a great desire to
‘have a go’ myself, and felt that the number of roles I had
undertaken in the past would provide the necessary skills
to run my own company. Well, they definitely helped, but
needed much ‘fortification’ over the following years as our
staff increased from 13 to 30 and our turnover quadrupled.
I say helped, but that is an understatement. My time and
my various roles at Hutcwilco (a medium sized company
involved in a wide range of activities), provided a great
grounding on how to run a commercial manufacturing
and marketing company. The arrival of Chemring
Group, and their very disciplined corporate approach
to business was also invaluable, and highlighted
the important link between a formal and practical
approach to effective management.
While the majority of Flagmakers’ revenue was
generated by the sale of flags, we recognised
that flags were of little use in the absence of
hardware on which to display them. I mean
flagpoles of course, and even more importantly,
brackets on lampposts – the type you see in
their thousands throughout New Zealand to
display ‘street flags’. Consequently we focused
a significant amount of our resources on the
development of flag display hardware, in particular
hardware relating to street flag display, which offered
the greatest potential. We supplied numerous street flag
The Flagtrax system installed in Melbourne
7. 7
brackets to councils and other major users, and specialised in
marketing and manufacturing high quality street flags. As a
result we secured an estimated 80% of the market, which we
retained for many years.
Traditional national flags, advertising flags, decorative and
portable flags were all important to us as well, but street flags
represented our most important market. A major barrier to
street flag sales however, was the cost of raising and lowering
them. Nearly all sites are in main streets, and this necessitated
the use of cherry pickers, bucket trucks, trained technicians,
traffic management plans, safety compliance etc. As time
went on these complexities and costs increased, and it was not
uncommon for the cost of the street flags to be less than the
cost of raising and lowering them.
Our product development team consisted of me and our
talented qualified industrial designer, John Woollett – both
of us keen ‘hands on’ enthusiasts with a love of making
things, and making things better. We had already had some
successes with a unique range of portable flag and banner
display products consisting of the Flexipole, Xtendapole
and comprehensive Euro Range. We were retailing these
through Flagmakers and wholesaling overseas, primarily to
Australia, but were constantly on the lookout for a system to
get street flags up and down lampposts. We went down the
path of using ropes and pulleys and levers to raise support
arms, but these approaches were not new. Similar products
are renowned for their weaknesses, especially in windy
situations, and after all, we were from Wellington! We then
hit upon the idea of using a flexible rod to push the flags up a
track. This showed promise for relocation of not just flags and
banners, but also lighting, signage etc. and we protected this
concept with patents.
The challenge was to get the top and side of a rectangle
(a flag) against a flat surface at the same time as
it was pushed up the track, and a double sliding
mechanism was developed to overcome this.
As a result our ‘PushPull’ system was born,
which we initially incorporated into a product
we call FlagTrax. This product started to
attract interest in New Zealand, but it (and
other products we had developed) had the
potential to succeed further afield.
With the assistance of NZTE (New Zealand
Trade & Enterprise) we undertook a sales and
marketing approach, primarily to a select number
of major European flag manufacturers, where we
already enjoyed some success with our Euro range
of portable flag and banner displays.
With the promising potential of our display products
8. 8
and systems, and with a succession plan in mind, I sold
Flagmakers in 2011, but only after separating out the small
hardware design division which we retained, including the
name, Nexus Developments Limited.
Since 2011, four of us, including designer John Woollett,
have focused on further product development, and the
establishment of overseas distributors. It hasn’t been easy, and
the common prediction that things take twice as long and cost
twice as much as anticipated has been born out.
We continued to pursue the European market (fully
acknowledging that in the midst of the global financial
crisis the timing was appalling), but managed to sell some
reasonable numbers of our New Zealand manufactured Euro
range there, until we came to an arrangement to have this
range manufactured by a partner in the UK.
We also have the Euro range and FlagTrax manufactured in
Australia, and FlagTrax will be manufactured this year in
the US by our Michigan based US partner, Consort Group.
Consort launched FlagTrax in the US at the SGIA Expo, a
huge trade show held in Orlando last October, where it won
an SGIA Product of the Year Award.
With some unique products to take to market a greater
emphasis on sales generation is now needed, and in line
with our succession plan we now have Chris Souness, a new
director and shareholder on board. Chris comes from a strong
sales and business advisory background, and as Sales and
Marketing Director we are now taking our products directly
to end users in New Zealand, rather than through a local
distributor as we have done previously. We will also focus
on expanding our overseas distribution through licensed
manufacturers/distributors.
Over the years we have had our successes and setbacks. Luck,
opportunities, timing, and ‘giving it a go’ have all played a
role. The lessons to be learned are many and never ceasing,
and while there is no shortage of ‘advisors’ happy to make
their contribution with the benefit of hindsight, decisions need
to be made without this luxury, and that’s the interesting bit.
Experiences are increasingly beneficial as time progresses,
and my experiences suggest it will take twice as long and cost
twice as much, so be prepared for this. The people around
you will also play a huge role – you need people with the
necessary skills, as well as people who you respect, and will
respect you. You will be spending a lot of time together,
and often personal friends will not make the best partners,
directors, employees, advisors. Choose carefully!
If you think you do have a unique product or service, do
E N T R E P R E N E U R S H I P
9. 9
your research before spending a lot of time and money.
Unfortunately, many good ideas have been thought of before,
and it is too easy to get so wrapped up in your own ‘eureka’
ideas that reason can be overlooked. It can take a lot of effort
to replace a steady job and income with a successful venture
that will match the financial returns and security it offers, let
alone surpass them. This is in no way suggesting you don’t
take the plunge, but from my own experience, enthusiasm
needs to be tempered with reality, and some (yes, boring)
homework is vital. It can feel like a time waster, and can
result in disappointment if the results you discover are not
what you were hoping for, but better this than pain further
down the track.
Is your proposed product or service as unique as you think?
And will a sufficient number of people be prepared to
pay money for it? The world is awash with truly superbly
designed and manufactured products, and many are incredibly
well priced. Many are made in low labour cost countries
of course, so if you have a product in mind, where will it
be made? Local costs are high, but overseas manufacture
typically requires volume, and it is likely you will be starting
with high cost, low volume manufacturing – not ideal when it
comes to rapid market penetration. Also beware of locking off
a design too early, especially if expensive tooling is involved.
Our more recent focus has been on disruptive products that
displace services. While products in general become better and
more attractively priced, services in New Zealand and other
developed counties remain disproportionally high. You can buy
a flat screen TV for $400, or spend the same amount spending an
hour with a lawyer. For this reason, products that reduce service
costs have particular appeal, and our FlagTrax does just that.
Street flags can be raised and lowered in seconds, at a cost of,
say, $5.00 each, compared to the previous method requiring
bucket trucks and all of the associated costs, which in some
areas can cost up to $100.00 per flag. FlagTrax can therefore
save large users hundreds of thousands of dollars over time,
and recoup the initial capital costs in a very short period. Our
new FlagTrax Duo utilises the same technology as Flagtrax,
and enables both flags and decorative LED Eco lighting to be
raised and lowered from ground level, providing a true 24/7
display without the previous operational cost.
While doing your research and market validation, always
bear in mind the opportunity cost of your product or service.
We all tend to identify our competition as those products
or services very similar to ours, but this is not always the
case. In Nexus’ situation councils may for example, decide
to invest in more flower beds rather than flags. If you have
a consumer product in mind you must be mindful of similar
products, as well as the alternative opportunities consumers
may decide take when spending their money – or they may
choose not to spend it at all.
Your ‘eureka’ product may already be under development
with another company, but may not have reached the
market, or may have done so in the past and either failed,
or lived out its life. Alternatively, there may be people or
companies far better equipped or resourced to make the
most of your new idea, and this can be to your benefit, or
otherwise. I have heard stories of inventors approaching
large overseas manufacturers who have stated, “If it’s
patented and it’s good we will consider it, if it’s not patented
and is good we will copy it”.
As well as an interest in products, I have always enjoyed
working with figures, and spend a lot of time with
“Is your proposed
product or service
as unique as you
think? And will a
sufficient number
of people be
prepared to pay
money for it?
10. 1 0
To find out more about Peter and Nexus Developments visit www.nexusdevelopments.com
E N T R E P R E N E U R S H I P
spreadsheets. I consider a budget and monthly profit and
loss calculations and comparisons essential. These force
you to think of your operation as a commercial business, to
consider all of the factors involved, and it provide a series
of regular snapshots of performance. They identify trends,
enable action to be taken sooner rather than later, and should
ensure you are never in for any surprises, nice or nasty!
The success of commercial entities is ultimately measured
by one thing, numbers, and while many other aspects are
vital, after an initial start-up period (which, don’t forget, it
will take twice as long and cost twice as much as originally
anticipated), to succeed the appropriate financial returns
must be forthcoming.
IP protection is something we have spent a lot of money on
in the past, and in some ways it can be a mixed blessing. In
New Zealand in particular, we have used design registrations
to discourage copyists, and this has largely been successful.
For our more important IP we have applied for and been
granted a number of patents both locally and overseas. These
can be expensive, and for small New Zealand companies the
question always remains, “What do we actually do if copying
takes place, especially overseas, and by large powerful
organisations”? The resources (money and time), distraction
and uncertainty involved in litigation can be disconcerting.
Having said this, in appointing distributors we have found
the increased level of security offered by formal IP protection
assists credibility and is definitely a positive influencing
factor, and we will continue to seek and support IP protection
where we consider it necessary.
I have already mentioned the complementary nature of our
team; we all get along well, and have different skills that
combine to make an effective company. We pride ourselves
on acting with integrity, and enjoy working with our
suppliers and customers alike. We feel that the trust derived
from this approach is positive on both a business and
personal levels, and it is one I would recommend to those
getting into business.
In summary, if you are keen to take the plunge and have a
great idea or opportunity, do so, it’s exciting and rewarding –
just do so with eyes wide open, look long and hard before you
leap! Utilise all of the knowledge you have gained in previous
roles, do your research, in particular market validation and
competitor analysis in its widest sense. Is the need you think
and hope exists really there, and to what extent? Crunch some
numbers, and seek advice from experts when possible.
“If you are keen
to take the
plunge and have
a great idea or
opportunity, do
so, it’s exciting
and rewarding
– just do so with
eyes wide open
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12. 1 2
B U S I N E S S L E S S O N S
To Make the
Phone Ring,
Y
our phone is not ringing as much as before,
companies are taking longer to reach a buying
decision and referrals are slowing. Combine this
with poor time management and what do you have? Disaster.
So what can you do to maintain sales and income?
One option is to understand the value of your time and
organise your day to earn more. Here are eight concepts to
help you do just that.
M O N E Y H O U R S
Organise your day around the “money” hours.
These are the hours that you can and should
be talking with your prospects and customers. Going out
on appointments. Calling on the telephone. Finding new
customers and seeking opportunities with existing ones.
The money hours are too valuable to waste on non-revenue
generating activities. Confine these activities to before or
after your money hours. This requires discipline, doesn’t it?
How much easier is it to do a bit of paperwork rather than
picking up the phone?
B E S T T I M E T O C A L L
When calling, persistency pays.
Sometimes up to six calls are required.
The best time to call to get real people willing to do business
is between 3.30pm and 4.45pm. The best time to get a “live”
conversation is between 3.30pm and 5.30pm. Friday is the
best. Monday is the worst.
The best results are obtained within 24 hours when returning
incoming phone calls. And leave a good message.
P R O S P E C T I N G H O U R S
Dedicate a certain percentage of your money
hours to prospecting for new business. Vary the time of day
when you contact individuals to increase the probability of
reaching them. As this is an activity most people hate, put it
in your schedule. Then do it. Pick up the phone and - as all
telemarketers are told - call with a smile on your face.
Put a
Valueon your
Own
Time
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By Debbie Mayo-Smith
13. 1 3
F O L L O W U P
Do what you say you’ll do. Ensure you
document your follow-up immediately. If you
set it aside for later you’ll either forget to do it or you won’t
remember all the details.
Documentation can be your paper diary or, even better,
your computer. Your proprietary or email software has the
ability to be your memory and prompt you automatically.
You can write notes, add attachments, - but more
importantly, you can set a date and time for it to pop up
and remind you to do the follow-up.
Use these prompting functions to help you to maintain your
follow-ups when faced with a continuum of “not yets”.
Persistence pays off, yet very few people persevere when they
don’t get an immediate “yes”. The prompt is also superb for
those longer-term “call me back in six months” follow-ups.
To make it easy, standardise your most frequently used
follow-up pieces for easy production and distribution.
A little extra advice: with so much email clutter and
spam filtering, if possible, post the marketing or proposal
material in addition to emailing. Emailing allows recipients
to share and forward it. However, many large corporations
and government departments strip attachments or limit
mailbox sizes, so the recipient may never see your email or
attachments. Posting a print version ensures they do.
K E E P I M P R O V I N G
Make sure you schedule non-money
hours for professional development
such as sales skills, people skills or improving
industry and/or product knowledge.
K N O W Y O U R S T A T I S T I C S
Sales don’t appear magically out of thin air.
The “yes” you got today from a customer
was generated by an activity that occurred in the past. One
of the biggest problems for small business owners and the
self-employed is being too busy and allowing marketing and
business development to slip off the radar.
In other words, not following point 1 - using the money hours
correctly. If your sales funnel is four months and you were
busy in February, neglecting to create activity, June will be
unusually quiet.
Here are other statistics you should know: How many
phone calls or emails to make contact with an individual?
How many contacts to a qualified lead? Qualified leads to
proposals? Proposals or contracts to customers? Calls per
hour? Follow-up attempts before dropping?
P R O D U C T I V E D O W N T I M E
Always, always have something to read for
flight delays, waiting rooms, standing in lines.
Use your time driving to listen to educational, business
podcasts or CDs. With headphones, you can also use the
time to make call backs.
J U S T O N E M O R E
If you can discipline yourself to make
just one extra contact a day with someone
new, you’ll have about 250 extra contacts in a year.
Debbie Mayo-Smith (BSc Hons Econ) is an International Motivational Business Speaker
and Managing Director of SuccessIS! and a leading specialist in easy practical ways to
improve business profitability, personal productivity and Internet marketing. Debbie lives
in NZ and travels the world speaking, writing and training. By the way, if you’d like to get lots
of neat tricks like this, plus marketing and business development tips, why not enrol for her free newsletter?
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14. 1 4
I N T E R V I E W
H i J o h n - D a n i e l , w h a t ’ s t h e s t o r y
b e h i n d y o u r b u s i n e s s , h o w d i d i t
g e t s t a r t e d a n d w h y ? H o w d i d t h e
f o u n d e r s m e e t ?
Mindscape was founded in early 2007 by Jeremy Boyd,
Andrew Peters and I. We each took a third stake in the
business. I had started working at Intergen in 2004, fresh out
of university. I’d been assigned to work with Jeremy, who
had also been one of the people to interview me and hired me
into Intergen in the first place. Jeremy is a brilliant software
engineer and I was always in awe of his ability to build
software, teach people and show sound judgement. Andrew
joined Intergen later and was also a solid engineer.
I had never made it a secret that it was my intention to
operate my own business one day. I’d even bought shares in
Intergen hoping I could eventually buy enough to be one of
the major shareholders.
When that plan failed (the shares were just too tightly
held), I decided it was time to set out on my own. I knew I
wanted business partners – I have my strengths, but I’m also
reasonably aware of my weaknesses. I approached Jeremy
and Andrew independently and asked each of them: “If you
could have one other person involved, who it would be?”
They both responded with each other’s name! We met at a bar
after work in late 2006 and agreed with a handshake that we’d
leave and build a product company.
John-Daniel
Trask
with
ofMindscape
Questions
15. 1 5
We decided on software development tools for our product
domain as it was an area we were experienced in. Simply put,
software development tools typically sucked. We wanted to
build great tools that empowered developers to build more
robust software while also enjoying the experience. We
achieved all of that, but it has been a long road with many
lessons learned along the way.
We also invested in several businesses since starting our
own and have enjoyed watching them grow. We were also
involved in Givealittle, an online fundraising platform
that was sold to the Telecom Foundation in late 2012.
Givealittle has helped raise millions of dollars for New
Zealanders in need and I’ve always been proud to have
helped bring that vision to life.
H o w d i d y o u s u r v i v e t h o s e e a r l y d a y s ?
D i d y o u h a v e a n y m o n e y ? D i d y o u m a k e
a n y s a c r i f i c e s ? H o w d i d y o u p a y t h e
b i l l s a n d k e e p g r o w i n g y o u r b u s i n e s s ?
I started Mindscape when I was 23 years old and therefore
didn’t have significant outgoings beyond my rent &
food budget. I wasn’t a big partier and didn’t have any
particularly expensive hobbies. I had built up cash reserves
to the point where I was sure I could live about 12 months
without taking in any income. Thankfully I ended up only
waiting a month or so before reinstating my salary.
I’d grown up knowing that you always needed to keep some
cash in reserve. It boggles my mind how so many people in
our society not only never save, but are running a negative
personal balance sheet.
Even when I was employed prior to starting Mindscape I
would feel extremely uncomfortable if my cash reserves
dropped too much. I think I gained this trait as a benefit of
growing up in a family where my parents were self-employed.
We discussed finances, business and the share market at the
family dinner table every night. My father helped me start
investing in shares at a very young age and I read all I could
about business.
Mindscape itself was bootstrapped, meaning we did service
work while building a product range. We were extremely
fortunate to get a service agreement with Microsoft New
Zealand on our first day of officially starting our company –
in no small thanks to Jeremy’s strong relationship with them.
That contract gave us a significant boost in capital reserves
and enabled us to reinstate a small salary for ourselves.
When I was about nine years old, I read an article about
Bill Gates. One part of that story has stuck with me all
this time. Gates was a perpetual worrier, and was always
convinced Microsoft was on the cusp of going out of
business – despite its success. He took the approach that
Microsoft should always have at least enough cash to
survive at 12 months without earning a dollar. It resonated
strongly with me and I’m always trying to apply that
principal to myself & my businesses.
16. 1 6
H a v e y o u e x p e r i e n c e d a n y b a d t i m e s ?
W h a t w a s t h e m o s t p a i n f u l l e s s o n
y o u ’ v e h a d t o l e a r n i n b u s i n e s s ?
The most painful experience was when one of the founders
decided to leave the business after about a year. It came as a
significant shock to me that he would do this after agreeing
from the outset to a significantly longer period. We had
some cash in the business at the time, but I can tell you right
now that it was not earmarked for buying back a third of the
outstanding shares!
We did buy those shares back and for a while it was
significantly stressful to me. Like many bad things that
occur, you often look back and realise you were focused
too heavily on a door closing and not enough on another
one opening. Today I own 50% of the business with Jeremy
owning the other 50%. The amount we paid to buy back
third of the shares looks very small now.
The lesson here was about integrity. I always looked for it, but
it’s been hammered home consistently in my life that integrity
is a virtue to look for above almost all others. If you cannot
trust somebody then you won’t get very far. I’m thankful that
Jeremy is one of the most high-integrity people I have ever
met, it’s helped our business go from strength to strength.
Interestingly enough, if you read The Snowball, a substantial
and thought-provoking biography of Warren Buffett, you’ll
find that integrity is the number one trait that Warren
looks for in the people that he invests with. Through my
experiences I can see why.
I s t h e b u s i n e s s v i s i o n y o u h a v e t o d a y t h e
s a m e a s t h e o n e t h a t y o u s t a r t e d w i t h ?
Absolutely not! If you’re not constantly revising what
you’re doing and where you’re going then you’re dead
meat. Furthermore, if you’ve never been in business before
then you’re in for a surprise. I smile every time I see a new
business owner think they know what the market wants.
I don’t say that as an insult, I was in the exact same boat.
In particular I had to up skill on marketing. I came from a
technology background and generally believed if you build
something, amazing people will find it and use it.
Our most recent product is a testament to continually
adapting our vision. We released Raygun (www.raygun.io)
in early 2013. It’s a cloud hosted crash reporting product that
supports every major programming language & platform.
It automatically collects data when an application crashes
and our service groups those crashes and helps developers
fix their software faster. It uses a software-as-a-service
(SaaS) model of monthly recurring revenue. Raygun has
been growing fast and part of that comes from supporting all
development platforms – not just Microsoft’s platforms. This
is an alteration from our original vision, but an important one.
D o e n t r e p r e n e u r s n e e d l o t s o f m o n e y o r
e x t e r n a l f u n d i n g t o b u i l d a b i g b u s i n e s s ?
Business certainly takes capital, but the amount needed to
start can be small. We formed Mindscape with $10,000 from
each founder, giving us a total starting capital of $30,000. We
were frugal with that and bought the bare minimum required,
we contributed our own existing computers to the mix so as to
not need to spend on new PCs etc. We then got contract work
to bring more capital into the business.
Too much money at the outset can also be an issue. There’s
truth in the fact that constraints breed creativity. It’s far more
common to see a successful business run by somebody who
watches every dollar than one where a company spends freely
on everything. I’m certainly somebody who keeps an eye on
spending. We were fortunate that Xero launched just before
us so from day one we had everything in Xero. A day doesn’t
go past without me checking our profit & loss – having a
great accounting software experience from the start helped
ensure that our team (with a background in programming, all
of us) learned the essentials of accounting.
One key signal that a business won’t be going far is when they
spend up large on having an amazing work space from day one.
If that’s the best place to spend your limited start-up capital
then there is something seriously wrong. Our first office was
a tiny box on top of a drug & alcohol rehab clinic – our daily
elevator rides were with people in seriously bad shape. You
probably don’t need to start with something quite so rough, but
I’d warn against investing heavily in wants rather than needs.
I N T E R V I E W
“It’s been
hammered home
consistently in my
life that integrity
is a virtue to look
for above almost
all others
17. 1 7
W h a t a r e t h e
t h r e e m o s t
i m p o r t a n t
b u s i n e s s
s k i l l s y o u
w o u l d a d v i s e
u p a n d c o m i n g
e n t r e p r e n e u r s
t o d e v e l o p ?
Focus on the money. To
a business, cash is your air
supply and therefore needs to be
front of mind a lot of the time. I see too
many people taking the Silicon Valley style
approach of growth with no revenue. Every business could
have charged sooner, probably charged more and done better.
If you’re delivering value then you absolutely should be
charging for it.
Worse yet, people who don’t/won’t pay for your service
are the worst type of person to have use your service – they
don’t value it. They’re a cost to you. They won’t magically
change into paying customers one day. My experience (shared
with many others) is that the less somebody pays, the more
of a pain in the backside they are – high expectations, high
support demands etc.
Learn how to
survive the roller
coaster. Business
is exhausting.
Learning to ride
that roller coaster
is important for your
mental health & for
your business. There
are certainly times where
you may feel like it’s not
worth the effort, but you need to
soldier on because there’s no value in
dwelling on a low. Get busy getting to the
next peak. Everyone can manage this in different ways,
but you do need to figure out what works for you.
Be more introspective. There’s a million self-help books out
there and I don’t necessarily recommend any particular one,
but I would say that they can help improve self-awareness
and situational awareness. For example, there are times where
I’ve found I need to be fairly ruthless in avoiding certain
people due to their general negativity. Being aware of what
helps you succeed and what hinders you is very important.
Achieving success is far more than what you do at your desk
every day – it permeates everything in your life.
“Business is
exhausting.
Learning to ride
that roller coaster
is important
for your mental
health & for
your business
John Daniel with Mindscape co-founder Jeremy Boyd
18. 1 8
W h a t h a s b e e n t h e l o w e s t p o i n t y o u ’ v e
f a c e d i n y o u r e n t r e p r e n e u r i a l j o u r n e y s o
f a r a n d w h a t d o y o u d o t o k e e p y o u r s e l f
g o i n g w h e n i t a l l g e t s t o o m u c h ?
There’s plenty of times when you’re feeling low – it’s the
nature of business. You get amazing highs and terrible lows.
Sometimes twice before lunch. It’s insane.
Learning to manage the lows is an important task for any
business person. For me, personally, I go for 10km runs every
other day. Usually outside in the fresh air, through some
bushes and around the bays of Wellington.
Often I prefer doing this alone since I can clear my head or
get in the zone and process something on my mind. I also like
to set myself a physical challenge every year.
I’d also be remiss not to mention the phenomenal support
I get from Zheng Li, my fiancé. She’s an accomplished
business woman in her own right, and we both are pretty
good at helping each other realise that the lows are not that
low, as well as encouraging behaviour to avoid dwelling on
things. She certainly has been key to me holding on to some
semblance of sanity over the years.
W h a t d o e s i t t a k e t o b e a s u c c e s s f u l
e n t r e p r e n e u r ?
Revenue to exceed expenses and sufficient return on
capital invested! If you achieve those, then you at least
have a successful business. Achieving that effectively
though comes back to the personality traits of the
entrepreneur themselves.
I don’t think there is a specific set of traits that equates to
success, but certainly some behaviours can assist:
Tenacity •
Confidence •
Calculated risk taking•
There is also ground work before starting any business.
Understanding the competitive landscape, appreciating the
level of work required to have a viable product and having a
view of the macro direction of the industry you’re entering
are all important pre-requisites.
W h a t d o y o u t h i n k a r e t h e t h i n g s
N e w Z e a l a n d n e e d s t o i m p r o v e u p o n
w h e n i t c o m e s t o c r e a t i n g m o r e
s u c c e s s f u l b u s i n e s s e s ?
In the product space I see too many businesses flame out too
early. They build something, expect immediate success, and
then when that doesn’t eventuate they give up on it. It takes
an age to really polish a product.
Yet I see experienced business people pulling the
plug on further investment in features I’d consider
necessarily in a first version because they can’t see
the return potential of doing it right away. I’m always
amazed at this because it’s just such short term
thinking. The nature of a product business is that
you have high costs at the outset but hopefully see a
solid return over the future lifetime of the product.
Conversely the other big challenge I see is from businesses
who believe they need to achieve perfection before getting a
product out the door only to find out too late that they misread
the market. Execute a minimum viable product (MVP) well
and be prepared to iterate like crazy as you engage with your
early customers about how to take what you thought was
needed to deliver a great product.
Y o u ’ v e a l r e a d y a c h i e v e d s o m u c h i n
t e r m s o f b u s i n e s s s u c c e s s . W h a t ’ s
n e x t f o r y o u ?
At present my entire focus is on Mindscape and, in particular, the
Raygun product. I’m passionate about business and technology
in general. I see myself doing this for some time yet.
I think there’s something in an entrepreneur that means you’re
never happy with the status quo – even when you achieve a
goal, the satisfaction is fleeting. You’re already thinking about
the next awesome achievement to hit. It’s both exciting and
exhausting at the same time – I wouldn’t trade it for anything.
I do have a strong interest in robotics and virtual reality so
perhaps one day I’ll do something in those areas.
the next awesome achievement to hit. It’s both exciting and
exhausting at the same time – I wouldn’t trade it for anything.
I do have a strong interest in robotics and virtual reality so
perhaps one day I’ll do something in those areas.
I N T E R V I E W
For more information about John-Daniel and his business, visit www.mindscapehq.com and www.raygun.io
19. 1 9
Why does stray need mobiles?
Ourtaglineis“offthe beaten track” so we’re not stayingatyour
maindestinations.We’re getting out there to the extremities
ofNewZealandand our sole wayof being in contact withour
driversisthroughphone communications.We have changes
happeningallthetime and we need to be able to contactour
teaminreal-time.
What Was your old provider like?
Therewerelargephone bills and if we had aproblem likea
phoneoutageitseemed theywere either busyor theyweren’t
organised,andcouldn’t get back to us.It was veryfrustrating
anditbecameaconstant problem within the business.
and What impact is 2degrees having?
Itsavedus$60,000 in the first year.In the second year,it’s
goingtosaveusthat again.Allthiswillgo back into marketing
campaignsorgrowing other parts of the business.Theother
impactishavinganAccount Manager I can get hold oftoget
solutionstomyproblemswhen I need them.
hoW is the coverage?
Thecoverageisfantastic.Regularly, I’m on road trips across
NewZealandandoff the beaten track and haven’t experienced
issueswithcoverage.With our old provider there werealot
ofblackspotsaround Auckland and I don’t get those with
2degrees.Andthebus driverscould be at Cape Reinga,they
could be at Stewart Island, they could be down the WestCoast;
soinallsortsofdifferent coverage areas and 2degreesworks
wellforus.
3x$89plan 37x$49plan 1x$149plan
What difference do mobile devices make?
Ourdriversarenowabletousetheirsmartphonesandother
mobiledevicestoshowvideos,photosandinformationabout
othertourpackagesandoptionsavailable,likeouroperations
inThailand,Laos,CambodiaandVietnam.Wecouldn’tdothat
beforeandithasmadeahugedifference.Ofcourse,they’ve
nowgotemailandinternetaccesstoo.
hoW reliable is the netWork?
SinceI’vebeenwith2degreesI’veforgottenaboutreliability
issuesbecausetherearenone.PreviouslyIregularlyhadissues.
Iwouldbeontheinternetanditwoulddropoutandwhen
Isampleda2degreesSIMcardinthere,Iwasamazedatthe
speed,howmuchquickeritwas.Iwouldregularlybeonthe
phonewiththelastnetworkanditwouldjustdropacall.Idon’t
getthatanymore.AsIsaid,thewordreliabilityhasdisappeared
frommyvocabularybecauseitissoreliable.
case study:stray
businesscare@2degreesmobile.co.nz0800 022 BIZ (249) 2degreesmobile.co.nz BUSINESS
better
For videocasestudiesaboutStrayandotherbusinesseswhohavemadethemoveto
2degreesBusiness,pleasevisit 2degreesmobile.co.nz/business
“I’veforgotten
aboutreliability
issuesbecause
therearenone.”
Stray Limited is an adventure bus company taking travellers to out-of-
the-way places around New Zealand. We caught up with Operations
Manager, Brett Hudson to talk about 2degrees and their business.
Stray
Adventure Travel
50 staff
41 mobiles
Around NZ
Joined 2012
BrettHudson
OperationsManager,Stray
“You need damn good partners for successful business, and 2degrees I put
in that category.“ Brett Hudson, Operations Manager
20. 2 0
G e t t ing I t D one
By Richard Liew
Lessons from
the Trencheso
I
get asked this question a lot and my answer is always the
same... “Now!” There is a Chinese proverb which goes,
“The best time to plant a tree was 20 years ago. The
second best time is now.” And it is no different when it comes
to being an entrepreneur.
T h e r e a r e t w o r e a s o n s f o r t h i s :
Just as you cannot be a swimmer until you have
jumped into the pool and begun swimming, you
cannot be an entrepreneur if you have not taken
the first step and begun your first business. Studying it, talking
about it, planning for it... none of those things count. You’re not
a true entrepreneur until you’ve jumped into the pool.
But far more important than semantics,
entrepreneurship - like anything else worthwhile
- requires years and years of practice and
experience, to develop the skills, mindset, knowledge,
understanding and personal qualities needed to build
successful businesses time and time again. The sooner
you get on with it, the quicker you’ll learn. You will learn
your biggest lessons from the mistakes you make and the
consequences you suffer, so the quicker you get those
mistakes out the way, the quicker you’ll learn. The longer you
delay, prevaricate and put off the inevitable, the longer you’ll
put off your success as an entrepreneur. Simple as that.
I then get the usual raft of responses... “But I don’t have any
good ideas”, “But I don’t have any experience”, “But I don’t
have any money”, “But I don’t have any time”, “But I have
kids”, “But I have a mortgage”, “But I’ve worked so hard to
get where I am already”, “But I’m too young”, “But I’m too
old”... and so on and so forth. To which I reply, “But that’s
Hard Learned Lessons
from Entrepreneurs in
Training When is the right time to start a business?
�
�
21. 2 12 12 1
Richard Liew is the Founder and CEO of Espire Media. To find out more visit
www.espiremedia.com. Do you have adivce for readers? Get in touch with the
editor at nick@nzentrepreneur.co.nz
exactly what the job of the entrepreneur is - to start and build
a profit making enterprise, in spite of all these challenges!”
The first step in becoming an entrepreneur is to understand
and develop the entrepreneur mindset.
Lack of money? The true entrepreneur finds a way to get
some or make do without it. Lack of experience? The true
entrepreneur will start and learn quickly as they go, or find
people with the experience they need. Lack of a “great” idea?
The true entrepreneur gets started with the best idea they
have right now, knowing that will lead to further (better)
opportunities as they get moving. Lack of time? The true
entrepreneur finds a way to make time.
At the end of the day it comes down to your commitment to
being an entrepreneur. How badly do you want it? What are
you prepared to sacrifice? Are you prepared to let life and
circumstance determine what you can have and when you
can have it?
Or are you prepared to accept full responsibility for the
achievement of your goals in life, and to find a way to make
it happen no matter what?
If your answer to this question is “Yes”, then the truth is that
you have everything you need to get started, right now.
There is no such thing as the “perfect” time. But for a true
entrepreneur, it is always the right time.
22. 2 2
E N T R E P R E N E U R S H I P
I
am a married man of 20 years, have two children and live
in Wellington. To ensure that our business was profitable
and could survive the downturn in the economy, I made
sure that our business grew organically. No big investment in
equipment, fancy offices or flash cars. By having one foot still
in contracting for larger organisations it allowed me to have
a base income to launch my company. I honestly believe the
first two years stole some time from my life, made my hair
grey and made me lose focus on other important aspects of
my life, such as friends and family.
My wife Andrea was working at the local school library and
I don’t think she appreciated my sleepless nights, waking up
at 4am to sort out the day’s schedule, research new products
and carry out the invoicing, then also staying up late at night
networking and selling solutions while trying to maintain my
9-5 consultancy work.
After a few years my wife joined the business, part time
at first, but then full time; wages, HR, Service Delivery
Manager, etc. She now knows how it feels to not only own a
business but also have the lives of your staff in your hands.
On the whole it has been very successful and we have many
happy customers and great relationships with partners,
however there is always the exception. We have had three
customers not pay huge bills over the last few years for
various reasons which we had no influence over. This is
hard and keeps you awake at night until ultimately you
have to make a decision; do you fight this all the way and
potentially do yourself and the business more harm, or do
you let it go and put it to bed. The latter is what I did even
though it pained me to do so. It was the right decision, as
now I can put things into perspective and let the important
things fill my mind. It also made me more wary and initially
less trusting of people and made me tighten up the way I
deliver my contracts to customers.
In 2012 I was contacted by IDC (International Data
Corporation) to see if I was interested in the results of a recent
Tony McDonald -
McDonalds-ITMcDonalds-IT was established in 2007 for two reasons; firstly
to embrace and deliver the ever growing cloud computing
technology, and secondly to treat small / medium businesses
with the attention and respect they deserve in terms of IT. So
many larger IT firms neglect the IT needs of smaller businesses
because it’s not profitable. It was time change all of that.
23. 2 3
service survey. Apparently McDonalds-IT were 6th on the
chart results above Fujitsu. Of course I thought this was some
sort of joke, however 6 months later a colleague of mine gave
me the chart, I was surprised, but also proud of the work I had
put in to raise the profile of my brand.
Even the customers that have been with me a long time can
offer surprises and it is important to not neglect anyone or take
things for granted. We have one customer that was perfect and
we got on like a house on fire. However that all changed when
a new member of staff joined. There was a personality clash
that I didn’t expect with a member of my team and it wasn’t
initially obvious or apparent to anyone except the customer.
Taking time out to talk to your customer over a coffee or
morning tea is vital to cementing the relationship and creating
an environment where you can be approached freely.
This also applies to your own staff members and I think this
is one area that sets McDonalds-IT apart from the others. All
of my staff were hand picked, not only on their skills and
abilities but on how they will interact with each other and
our customers. Anyone can be trained in IT but having those
excellent interpersonal skills is not something that can be
taught. For me, good people are a must and we all work hard
and play hard. We have a great office overlooking Midland
Park and you can guarantee that on a Friday we will be
playing darts and drinking a beer. It’s not because we have
to, it’s because we want to. I am very grateful to have this
wonderful team around me.
At the beginning, arriving from England, not only was I
trying to adjust to life in NZ, but at the same time trying
to get my brand out to businesses that already had IT
providers. This is one of the hardest challenges which
takes time, money (advertising and entertaining), and lots
and lots of patience. Some leads took over a year to come
to fruition, and if I was to give advice, it would be to
never give up if you believe in yourself or your product.
However, if it’s not working seek help, either in the form
of networking groups or business advice.
Our latest customer is Red Cross New Zealand and we have
become a Loyalty partner, donating $25,000 to charity within
the first 3 months. Being a member of the Port Nicholson
Rotary club in Wellington makes me very happy to be able
contribute to a great organisation.
To be successful at running a business you need to be
dedicated, extremely focused and selfish to a point. The rest
of your life has to take a back seat for long periods, especially
in the beginning. Having said that I think I went over the top
at times and was in danger of missing my children’s teenage
years. Luckily for me I realised in time and took my foot off
the gas a little.
Having started out life as an architect in building, moving on
to IT and then starting my own business, I am always looking
for exciting opportunities. I play, write and sing music in two
bands (Secret of Origin and Plastic Groove) and am currently
getting my micro brewery off the ground (Hops Valley). I also
write music reviews for music.net.nz and Stuff Nation.
As you can see, if I’m not busy, I’m not living.
To find out more about Tony and his business
visit www.mcdonaldsit.co.nz
McDonald’s IT present Red Cross NZ with their generous donation
24. 2 4
To m o r r o w s E n t r e p r eneu r s
O
ne of the most common questions that
I get asked is ‘How are you funded?’.
Many people often assume we are an
offshoot of the Ministry of Education, when the
reality is quite different.
Young Enterprise Trust is a charity which is funded
by a combination of corporate sponsorship, donations
and community funding. Our largest funder is The Lion
Foundation and there are more than 30 organisations that
support us financially.
We know that our programmes make a difference to the lives
of thousands of students, but we need to find the funds every
year to do so. This month we are running our annual donation
appeal and I am hoping you might be in a position to support
us. Any amount will help:
Donate $400 and one student will complete the Lion•
Foundation Young Enterprise Scheme
Donate $200 and one student can travel to participate in•
the Enterprise in Action Weekend
Donate $65 and one student will complete the BP•
Business Challenge
Donate $15 and one Student Workbook will be received•
by a student
Every little bit helps – so if you want to support the next
generation of entrepreneurs, please visit our Givealittle page
to make a donation. We’re proud to use Givealittle – it was
created by one of our alumni, after all!
Young Enterprise
Businesspeople Volunteer
Across the Country
M
ore than 2,500 students will set up new
businesses this year, with the support of local
businesspeople throughout New Zealand.
The Lion Foundation Young Enterprise Scheme is a year-
long programme where secondary students create a small
business and bring a new product or service to market. The
programme, which is managed by the Young Enterprise Trust,
has been helping students learn about the business world for
more than 30 years.
“The aim of the programme is to help students develop
their entrepreneurial skills,” says Robyn Frey, who
manages the programme for Young Enterprise Trust.
“The students learn about the different aspects of running
a small business, from planning and capital-raising to
production, marketing and sales.”
Students are supported throughout the year by their
teacher, a regional coordinator and members of the local
business community.
Terry Shubkin, CEO
Young Enterprise Trust
If you would like to volunteer as a mentor, please
contact Young Enterprise Trust on 04 570 0452 or
email support@youngenterprise.org.nz. Young
Enterprise Trust is also running a webinar for new
mentors on Monday 24 March. Register now and
listen in live or view the recording on demand.
25. 2 5
“We encourage every Young Enterprise company to find a
local businessperson who will mentor them throughout the
year,” says Robyn. “In addition, they get early feedback
and advice on their business ideas in a ‘Speed Coaching’
workshop that sees them connect with many businesspeople
right at the start of their school year. It’s a fantastic and
authentic way for students to evaluate their business ideas.”
Young Enterprise CEO Terry Shubkin says that volunteers
often enjoy the experience as much as the students.
“Volunteers often tell us how the Speed Coaching session
leaves them inspired and energised. It’s the perfect way for
volunteers to use their skills in a way that benefits both the
student and the volunteer.“
Bill Smale has been mentoring Auckland students through
the programme for many years. “I get great satisfaction out
of being a mentor, especially when I see the untainted ideas
coming forward. It is great to see the enthusiasm and energy,
especially when they have come up with an idea and how
they are going to make it all work, and to see how they solve
each problem as it arises.”
Mentoring generally involves 1 or 2 meetings per month with
a student company, from February to November. The CEO
of the student company will contact the mentor to arrange
a meeting time and venue that is mutually convenient, or
mentoring can take place via Skype if necessary.
Brett Warwick from the New Zealand Fire Service mentored a
group of Wellington students through the programme in 2012.
“The young women were very focused. They established a
good business plan at the start of the business and to a great
extent stuck to that plan. I would meet with the team every
couple of weeks and whenever we did meet, I found that they
had made good progress.
My job was very easy. It involved just listening to the team
and providing encouragement when required. Just being told
how well they were doing motivated them.”
“We know that our
programmes make
a difference to the
lives of thousands
of students, but we
need to find the
funds every year
to do so.
26. 2 6
W h i c h p r o j e c t a r e y o u m o s t e x c i t e d
a b o u t a t t h e m o m e n t , a n d w h y ?
I’d have to say MedSailors. We’ve got to the point where
things are working well – our team is growing and we’ve
been able to put more money into marketing. After a few
years of focusing on getting the basics right, there’s now
some fat in there to do something creative. We’re currently
looking into launching new tourism ventures in other regions,
including New Zealand, which I’m definitely excited about.
W h a t w o u l d y o u s a y a r e t h e m a i n
t h r e e t h i n g s y o u ’ v e l e a r n t t h r o u g h
r u n n i n g y o u r o w n b u s i n e s s e s ?
First one would be the importance of people. The people you
want on your team are ones who bring unique skills to the
table, you have a common goal to aim towards, and they’re
able to help you share the load. I also believe in quality.
You need to deliver something truly great in order to build
that reputation in the market place and get word of mouth
Meet Hamish Dobbie – a 31 year old kiwi entrepreneur who has successfully launched a number of
businesses to date, including MedSailors (www.medsailors.com) – 7 day skippered sailing holidays in the
Mediterranean, Yolkr (www.yolkr.com) – an innovative baking tool that allows you to easily separate eggs,
and Dobsol (www.dobsol.com) – an Auckland IT company building cloud-based applications. He catches
up with Latesha Randall for a quick Q&A.
I N S P I R I N G S T O R I E S
Hamish
Dobbie
27. 2 7
working for you. Third thing I’ve learnt is having a good
strategy. I know you have to be realistic and keep an open
mind to things changing, but I think it’s great to have a star
you’re shooting for and a plan for how to get there.
D i d y o u h a v e a n y k i n d o f m e n t o r ?
O r t o o l s f o r l e a r n i n g t h e t h i n g s y o u
n e e d e d t o k n o w ?
Although I’ve had family friends I’ve sat down and talked
with about things, I’ve never had a dedicated mentor. I’ve
been inspired by a lot of people who have got out there and
done awesome things, like Richard Branson and Steve Jobs
for example. I’ve read a lot of books! And always tried to
spend time with people who I see as successful.
I s i t t r u e t h a t p a r t o f b e i n g a n
e n t r e p r e n e u r i s a l w a y s w o r k i n g c r a z y
h o u r s – o r d o y o u f e e l i t e n a b l e s y o u
t o h a v e a b e t t e r w o r k / l i f e b a l a n c e ?
What’s work-life balance? [laughs] When you’re an
entrepreneur, you end up doing everything, especially at the
beginning stages of a new venture. I’ve always been a bit of a
perfectionist too so I guess if I backed off on that a little then I
might have more time – but I really enjoy it. It’s not ‘work’ to
me, it’s exciting getting something over that breaking point.
A n y t h i n g y o u ’ d d o d i f f e r e n t l y i f y o u
c o u l d g o b a c k a n d r e p e a t a l l y o u r
p r o j e c t s a g a i n ?
Yeah, plenty. I think I dived in too deep at the start – went out
on my own with some savings from working as a engineer for
a few years, and straight into a whole new world of software
development. I could probably have done that a ‘safer’ way
and worked part time in a job to learn the skills I needed, but
overall I feel it was good I had that pressure there of needing
to learn fast and well. I’ve also learnt the importance of
having good contracts in place and developing relationships
with experienced people.
H o w h a v e y o u f u n d e d y o u r v e n t u r e s ?
Apart from Yolkr, which I raised about £43,000 via
Kickstarter for, everything else I’ve done has been self-
funded. I haven’t taken the option of getting outside
investment. Kickstarter was a fantastic experience
Hamish’s invention - the Yolkr completed a successful fundraising on Kickstarter
28. 2 8
Latesha Randall is an enthusiastic connector, entrepreneur, and writer based in Raglan - she
enjoys working with start-ups and business owners as one half of Seb & Tesh, helping them
create, clarify and implement their business ideas. www.sebandtesh.com.
I N S P I R I N G S T O R I E S
though; wish I’d invented that platform! It really
speeds up the creation process of a venture allowing
you to validate the market and limiting over
investment in time and product development.
Do you think Kiwis are natural innovators?
Yes, definitely. Everyone you talk to has an idea! New
Zealanders are generally resourceful, capable, and connected.
It doesn’t take too much in an environment like that to take
something from thought to commercialisation.
A n y c o o l n e w i d e a s i n t h e p i p e l i n e ?
I really enjoyed the whole experience of creating the Yolkr
– taking it from an initial concept into CAD modeling, and
manufacturing. I now have a few ideas of novel, practical
homeware products I’d like to make. I’m planning to aim for
one new product each year. I’m also enjoying building cloud
systems for businesses (Dobsol) – it engages that engineering,
problem-solving part of my brain. It is going to keep me busy
this year too!
“The people you
want on your
team are ones
who bring
unique skills to
the table, you
have a common
goal to aim
towards, and
they’re able to
help you share
the load.
29. 2 9
E N TR E PR E N E U R I A L I N T E L L I G E N C E
with Sandy Geyer
Things are getting a bit more serious with our early-
stage start-up. We’ve been pretty laid back so far about
legal work and documenting things. Lawyers are so
expensive. What are the essential legal documents for
our business that we need to put in place first?
The time to consider legal documentation is when your
business starts to become valuable to those financially and
intellectually invested in the entity. At that point in the
business, important parties to the business could be adversely
affected by two things.
The first is unexpected events such as the death or
disabling illness of one of the partners, and the second is an
unsuccessful collaborative or contractual agreement between
internal and external partners in the business structure.
Buy and sell agreements (contracts that specify a buyout
process and make financial provision for that process) will
protect the business from having to pay out cash values or
unearned salaries in the death/accident scenario, which in
reality could take a fragile business down financially.
By “fragile business” I mean any business that doesn’t have
endless cash resources and those that rely on the intellectual
input of any of the partners to stay afloat. If there are no buy
and sell agreements in place upon the death of a partner and
no provision for a buyout has been made, you could end up
with that partner’s family as your business partners, and that
might be less than ideal for you all.
Many financial advisors can arrange legally compliant buy
and sell agreements for you from attorneys they might work
with regularly, who will know exactly what it is that you need
and will charge accordingly and reasonably. When entering
contracts with other parties it’s important to consider how
expensive a disagreement could be and make provision for
such events in the contracts.
When drawing up agreements to formalise day-
to-day business issues, I always do it myself in
layman’s terms and only ask for a lawyer to rewrite
it in “legal speak” if such a formality will make or
break the outcome of a future disagreement.
This minimises the legal costs and keeps them limited
to only what we really need. I certainly wouldn’t
advise spending any more money than is absolutely
necessary on legal fees, but it is important to understand
where these fees do become an important investment
in place of a drain. In the majority of situations,
common sense goes a very long way in placing
safeguards for possible bumps along the way.
In each issue Sandy will be answering commonly
asked questions from new entrepreneurs. If you have
a question for Sandy to do with entrepreneurship,
building successful businesses or the challenges and
difficulties faced by entrepreneurs, email the editor at
nick@nzentrepreneur.co.nz.
Entrepreneurial
Intelligence
Sandy Geyer is an entrepreneur and mentor and teaches the principles of entrepreneurial
intelligence (EnQ), to entrepreneurs in New Zealand, Australia and South Africa. You can
visit Sandy’s website at www.enqpractice.com
30. 3 0
T A K I N G T H E P L U N G E
P
ete’s Natural started about four years ago when
the company’s founder - Pete Blommaert, had the
undeniable urge to start brewing his own lemonade.
Pete had been a baker for over 30 years, and has run bakeries
in three different countries on three different continents.
The minute he got home after this epiphany for making his
own lemonade, he pulled out all the buckets and pails he
could find and started mixing all the ingredients he could
possibly come up with.
Pete’s first brews weren’t deemed successful by his family,
and with each new batch they got more and more fed up.
Pete’s wife wasn’t amused having bucket after bucket thrown
around the house and everyone was well and truly sick of
Pete constantly insisting that they try ‘just one more time’.
Eventually, Pete got it right and came up with something
drinkable that his family approved of.
It was time for the neighbours to try their luck. Pete carted
bottle after bottle across the road day after day. Each time
they would come back empty with a note included. (Yuck, but
better than the last one...) The thing about Pete though is that
he was determined to get it right. Day after day the bottles
and brews kept coming until finally, he got a positive note
back from the neighbours.
This was the defining moment when Pete’s life changed
forever. Pete’s Natural was born.
Based in Nelson, the company currently produces all natural
lemonades spanning four flavours - Lemonade, Currant Crush
(blackcurrant), Orange Berry Fusion (Orange Strawberry)
and Lime-O-Nade (Lemon, Lime and Mint). All are lightly
Pete’s LemonadeAn Idea Inside
a Bottle
31. 3 1
sparkling and made with only New Zealand grown fruit, no
chemicals, preservatives or artificial colours or flavours.
Pete’s Natural is now hoping to supply all New Zealanders
with a healthy alternative to sparkling beverages while
supporting the New Zealand economy by buying local, they
currently support over 300 customers. After that, they want to
conquer the rest of the world.
Pete has always been used to a cash business but feels that
managing this is key to the company’s success. “Selling to
retailers and having to wait until the following month to get paid
can be tough while you still need to invest in available stock for
the following month. It’s important to control the growth so that
you can keep up financially with supporting the growth.”
“Think before you
begin but follow
your dream and
make sure to have
plenty of starting
capital, it always
takes way more
then you expect
Whilst gaining great satisfaction from seeing the product on
the shelves of bakeries, cafes and eateries Pete does offer
caution to any budding entrepreneurs.
“Think before you begin but follow your dream and make
sure to have plenty of starting capital, it always takes way
more then you expect. Keep in mind that you will need to put
in a lot of time and effort to start and grow the business but in
the end it’s all worth it.”
“It’s not easy running a small business but if it was,
everybody would be doing it.”
For more information visit - www.petesnatural.co.nz
