The channel conflict noted in this article reveals one of the big challenges/opportunities for new SaaS vendors
Under an online model, there are often issues with your existing ‘real world’ channel.
- Does the old world channel add value in an online world? Does it get you sales?
- How do you pay a sales channel if there is no up front license fee? Often SaaS pricing is sharp because they have eliminated some of the channel and distribution costs.
- Ongoing commissions for sales is a very expensive sales cost for SaaS vendors. The real cost of SaaS is driving more innovation and outstanding customer care, so a recurring fee model just for a sale is to much cost.
Flipping it around, existing real world channel needs to think about how they share in this new online world as the inventories of products they earn margin on will erode.
In the business software space this creates a huge opportunity for buyer aggregation points. The retail browsing shop of the 21st century.
In the New Zealand small business SaaS market this is where MED and NZTE can really help out. Providing a location where NZ small business owners can discover great products that can make their businesses better.
This what small businesses have asked for. (Don’t worry, I’m onto it.)Wales Day 2
Another busy day with some great meetings.
After we finished at the Technium in Swansea I went and drove around to Mumbles (thanks for the tip Steve). The beaches are really nice. So far it’s been blue sky and warm.
Swansea is built around a bay, with traditional cottages terraced up behind the city. It doesn’t compute for me how these 100+ year old cottages have glorious sea views. There is a neat contrast between the traditional housing that frames the city and the new architecture in the waterside re-developments.
The beach huts were interesting. Imagine the social hierarchy between the front row and the next row back.
I found the Navigation option that makes the drive arrow point in the direction of the car, not just North. Faith in German design restored.
Half way through the learning journey in Wales. Nothing like spending time in country to validate your thinking and find insights that are not obvious from afar.Securing our Digital Trade Routes
After spending time with many New Zealand Internet thought leaders at Foo Camp early in February I started to think about what we could do to really connect New Zealand digitally to the world. I want to see a step change improvement in my lifetime.
I believe there is a growing case for the people of New Zealand to own the physical fibre connections between our cities and the connection to the rest of the world. I believe everyone, including carriers, win under this model.
The following paper is a discussion document. I welcome your comments.
(Last updated 28 February 2007)
Thank you to those that cast an eye over the document and offered suggestions.Office Phone Decision
Thanks for your suggestions on an Office Phone System.
Open Source PABX software Asterisk seems to be what the smart people are using and has the sort of characteristics that we expected out of a phone system in 2007. As we’re all about SaaS and the power of the Internet we want to practice what we preach.
Jamie from FX Networks is the guru and FX are setting it all up for us and managing the service. We’re ordering Linksys handsets and there are also adapters so that we can plug in those high quality Polycom conferencing phones. There are several good softphone applications available. Another great feature is that Asterisk has Teleconferencing, so we can set up an additional ddi and have many people dial in. Much better than a service where you pay for all legs.
As FX spreads their network out in NZ and links to other providers overseas we should see our call charges drop further. “A Race to Zero” as Jamie says.
It’s important that New Zealand businesses know about these types of services and products. The promise of the IP world is that we can operate globally. A clever communications system is a great way to get close to your global customers.
The costs are a fraction of what the traditional suppliers were talking. We’d rather spend our money on our smart people.Bio
Rod is an experienced entrepreneur and early stage investor passionate about software development and building value.
Angel investments include PlanHQ and a number of number of SaaS startup’s in technology build.
Prior to this Rod was CTO of Advantage Group where he spent significant time in the USA working with leading international technology companies.
In 1995 Rod established Glazier Systems, one of New Zealand’s leading software development and consulting companies. Glazier Systems was acquired by Advantage Group in 1999 and continues today as Intergen.
In the late 80’s to early 90’s Rod worked primarily for Ernst & Young/Arthur Young, as well as spending several years working on telecommunication billing systems both in New Zealand and the USA.
Through his career Rod has maintained a close relationship with Microsoft and was selected as New Zealand’s first representative on the Microsoft MSDN Regional Director program, holding the role from 1997 to 2000. Rod achieved Microsoft MVP status for his work in the early days of Active Server Pages.
Rod was an Independent Director of TradeMe, New Zealand’s most successful eCommerce Internet site when it was recently sold to Australian Public Listed Company Fairfax. Rod continues on the TradeMe Advisory Board. Rod joined NZ Trade & Enterprise Beachheads Program Advisory Board in August 2006 and is a member of the New Zealand Institute of Directors.
Rod has a Bachelor of Commerce and Administration (BCA) from Victoria University of Wellington majoring in Accounting.
Prior to children, Rod enjoyed windsurfing, surfing, mountain biking and snowboarding. He still enjoys living in Wellington, New Zealand.
I’m always keen to meet new people that love technology so please make contact. (Sometimes I’m a bit flat out so can’t respond as quick as I’d like.)
If you want to build a relationship, comment on my blog. Flick me a link to yours, or show me something cool you’re doing.
I believe that people are an investment so will always try to find a way to work with smart passionate people or get them into the network someway. I’m especially proud of the many staff we’ve had through the team over the past 15 or so years. Please don’t hesitate to make contact again.
I’m working on a number of new startup ventures and looking to signficantly build up our teams. We expect to hire 20-30 people over the next few months. Right now I’m specifically trying to fill the following roles:
- User Documentation Specialist. This will be a great role for someone passionate about clear messaging and making things clear.
- Ruby on Rails. I have a number of Ruby developments underway. Working with of the top Ruby Resources we need a few people. Exceptional learning opportunity and some fun products to build. We will look at excpetional people wanting to move into RoR.
- .Net Developers. Always hiring. We have an awesome team that is building world class products.
Here are some upcoming roles. Please make contact if you’re interested:
- Back end .Net Developers. ORM, TSQL, XML
- SQL Server DBA/Developer
- Web design/Graphic design
- Customer support
- Quality Assurance
- Operations Management
- In house commercial lawyer
Check this page often, I’ll try to keep it up to date.Upcoming Events
A good way to meet up with me is to catch up at an event. I’ve got a busy year scheduled so I’ll be pushing mentoring and support into scheduled events.
I’m currently scheduled in for the following…
|Nov 3||Wellington||Tech and the Markets||Contact the NZX|
|November 3||Wellington||PWC HiTech Awards||Annual dress up night for the tech industry
|November 7||Wellington||TUANZ Business Internet Conference||Michael Fowler Center|
|November 14||Dunedin||ICT and Beachheads coffee and muffins||Mecure 7:30 to 8:30
Contact Peter Harris at DCC
|November 15||Timaru||NZ Chambers of Commerce Conference||to be advised|
|November 28-29||Auckland||Digital Future Summit 2.0||Hyatt Regency Hotel in Auckland|
Can someone give me a hand to migrate to a WordPress hosted site? I don’t have time to do it myself and will gladly pay for someone to do it as a project.
- Recommend a hoster (that can host as www.drury.net.nz)
- Set up my site and load the graphics
- Load up my existing posts. I can supply them in RSS format which I believe can be imported
Why do I want to do this?
- I wrote my own blog engine and don’t have the time to develop comments, trackbacks etc.
- It’s not a good use of my time when there are great products doing a better job. The features of blogging engines are getting better and better. E.g. comment spam
- I can use standard tools for posting
- I believe in hosted apps. I don’t want to run and manage my infrastructure. Its getting easier to swap machines and OS’s when its all in the cloud.
Preference is someone in Wellington so I can build a relationship. Lost of other little things to do with these skills. But give me a yell if it’s easy remotely.CeBIT 2007
Gordon Stevenson from NZTE is close to finalising numbers for the ‘New Zealand, New Thinking’ stand at the CeBIT Trade Show in Hanover, March 2007.
We did this show in 2005 and it is excellent if you want to launch in Europe. NZTE make this event really easy to do and the cost is a fraction of what it would be if you did it by yourself.
If you’re thinking of doing CeBIT my strong recommendation is to have your German language version ready to go. There are 100m German language speakers and CeBIT is the ideal time to find customers and agents.
Contact Gordon at NZTE in Wellington for more info.30 hour commute
Alan from the UK shot me this really interesting article about commuting out of London.
Fed up with over-priced cities and overcrowded trains? The new breed of commuters are going to fly into work from their homes in Spain and eastern Europe, claims a trendspotting report.
Further than that, there are a breed of New Zealanders who draw their primary income from business interests in the UK yet live a large portion of their lives in NZ. The same technologies that allow international commuting also allow remote business to thrive.
This article shows that the presence dynamics between customers, employers, workers and business owners is becoming more mainstream. That is great for us.Vote for Me
This morning I spoke at an NZCS breakfast on ‘Crossing the Chasm: Services to Products’.
We had a nice crowd of about 60 people and a great discussion. Good to see so many familiar faces and meet a few new people.
The discussion was around transitioning from a Services model, where you primarily sell time, to building a Product where the revenue created is generated by product sales.
- A look a various models: services, off-shoring, products. Characteristics of each.
- Why products are great for you and for your country
- Barriers (mainly capital and experience)
I finished off with some discussion points of what we can start to think about to begin this transition. Here is a summary of those:
- Start developing product skills. If you are committed to outsourcing find funded product development opportunities to gain experience and make contacts.
- Develop Interaction Design expertise. User experience design and being able to model product concepts is a necessary skill for products. It also allows a concept to be shown early in the cycle potential reducing investment time to capital or revenue
- Begin to work out of your region. Sell outside your city, state, country to gain the experience of working outside of where you can walk to.
- Rethink Project and Organisational Structure. Start productising aspects of your service engagements. Look for repeatable chunks of functionality and develop them into modules.
- Reward or incentivise staff for productising aspects of service engagements.
- Add product people to your team to influence the culture.
- Move people from services engagements to focus areas. Encourage an SOA model between bespoke staff and the component developers.
- Get offshore. Go to conferences, meet people, see opportunities, benchmark. Do a fact finding trip. Light up old contacts. Get out there and put yourself in a position where opportunities can happen. You need to do a major international event ever year.
- Link into ex-pat networks. Often people want to come back and you can leverage their networks.
- Partner. Find other companies already in market. Find people with complimentary skills. E.g. marketing, international business, legal.
- Sack some customers. You will always be too busy if you have a full customer base so you may need to get rid of some. Choose a specialisation and wind down engagements with those that are outside. They will be fine. The next generation of services companies will pick them up and they can grow a business around those. In turn theyâ€™ll create a product company that pays taxes and funds your retirement. Let those non strategic customers go.
- Identify opportunities to introduce capital into your business. Maybe you can spin out a product idea and get that funded.
- Sell your business to release capital. Think not so much about what your business is worth, but the opportunity cost of not using your skills to build a product. Sell up, sell down to staff, introduce capital. Youâ€™re buying yourself the time to build the next big thing.
- Lobby for better Government procurement policy. Reduce the friction to get those first great reference customers and cash flow to allow you to build a platform for going off shore.
I hope a few people feel more motivated to start the journey.NZCS Breakfast event tomorrow
I’m speaking at the Wellington Club at 7:30 tomorrow morning.
Subject is ‘From Services to Products. Crossing the Chasm’
You can register here.Thoughts on the beautiful game
As the football world cup goes into it’s final weekend I have to confess that I don’t get it. I’ve tried to watch a whole game but I’d almost rather do a quarterly expense claim.
Why don’t they have a video referee? So much is at stake why should a snap decision be made by the referee. What does the match commissioner do if they can’t override a dodgy call? Everyone in the world knew 2 seconds after the aussie penalty decision that it was wrong. Adding a video referee would probably save the life of any of the whistle blowers that travel out of their own country.
And what is with penalty shoot outs? Why not some ‘one against one’ action so that there is some real skill involved.
Mustn’t criticise without a solution so here are some suggested improvements that could make for soccer.
- Make all the players run a half marathon first and then let them play a 20 minute game. That way we get straight to the action.
- Do away with goalies. Maybe make the net a bit smaller but that should see scorelines of 12-8. Much better.
- Make extra time sudden death and take a player off each minute.
- Put the referee on a Segway and attach a camera.
Sounds crazy? Look what they did with cricket.
Update: Cartoon on Saturday showed I was not alone …
I enjoyed speaking at the NZTE Enterprise Breakfast in Auckland this morning. The food must be good as we had a capacity audience of 230.
Around 40% of the attendees were non ICT. As I spend most my time in computing it’s interesting to hear about other industries. I was impressed that the majority of people shot their hands up when asked who was exporting and the number who had been doing the plane hours.
Auckland is quite different to Wellington. In a Government town there is a certain amount of expenditure that has to happen. We tend to be more service industry oriented. In Auckland I find that more people/businesses are outwardly focused and it’s great to get that perspective.
In my view exporters are our national hero’s so it was gratifying to see how many are doing it. It was good to swap stories with others who have been hitting the road. Doing the hard yards on the road leads so many interesting experiences and it’s inspiring to hear what others have done.
Thank you to those who sent me a note after the event.I need to invest time in Atom
Great post here on RSS versus Atom. On RSS and Atom
As we build richer web based applications the richer typing of Atom will be key. (For my own filing: The Atom Syndication Format)
There is the expected RSS/Atom debate going on, however his article puts the discussion in context: The Atom APIRIM (BlackBerry) to go for it
The CEO of RIM lays out that they are going to expand the BlackBerry to do wifi, have MP3 capabilities, camera’s etc.
RIM’s issue is their business model currently relies on an expensive Enterprise Server. This must now be at risk as Microsoft has included push email as a standard feature in Exchange.
There are rumours of RIM buying Palm.
Much better would be Apple to buy RIM. Both companies get usability design. RIM gets to put its technology into the marketing company. Apple gets a rock solid phone/email platform.Auckland Friday
I’m speaking at NZTE’s Enterprise Forum Breakfast Series in Auckland Friday morning. The subject is “Growing an International Business from New Zealand“.
Crowne Plaza Hotel, Auckland on Friday 7 July at 7:15am.
To register send an email to email@example.com with your name and company.
Please come along and say hello, except if I owe you money of course.IE7Beta 3 fixes CSS display problem
The CSS Display problem I mentioned here is fixed in Explorer Beta 3.
So I’ve backed that out.Govt ICT Review - don’t forget about industry development
Computerworld reports: Govt ICT review to focus on productivity gains
The emphasis will be on encouraging developments that will improve productivity in government agencies. Improved productivity is defined as â€œbeing able to reduce costs or obtain more cost-effective resultsâ€. This, in turn, is expected to have a material effect on the overall economy.
Reducing the waste of effort in ongoing RFP requirements is an obvious one that I’ve mentioned many times before but I was disturbed that there was no mention of the impact that Government Procurement has on developing export businesses.
Here is the logic (again)
- New Zealand needs to export so we have a more favourable Balance of Payments and create new wealth and more jobs that in turn leads to more taxes better social services, education etc.
- The New Zealand Government spends more money that any other organisation.
- For companies to grow they need revenue and reference customers.
- Therefore New Zealand Government procurement policies have a huge impact on the development of new export oriented companies, especially in software.
It is therefore concerning that this was not pulled out as major objective in the Computerworld piece.