TON App Showcase
Tuesday, June 22nd. 5-7pm
The Velvet Room
62 York Street (above Fat Tuesdays)

Click here to register and purchase a ticket for this event

Ottawa has long been known as a mecca of software development so why should mobile be any different? During the last four or five years some incredible mobile software has been developed and deployed, creating innovative and world-leading companies in the mobile space right here in Ottawa.

In this, our first Mobile Application Showcase, come out and celebrate this emerging economy, socialize with your peers and support a select number of local mobile developers who will demo their latest and greatest mobile applications.

From games for teens and toddlers to apps that help navigate the stars, come and see why millions of people worldwide are using Ottawa-made software on their mobile devices.

We’re pleased to have the following 5 companies presenting at the TONAppShow:

GlitchSoft
(makers of BarStar game for iPhone)
GlitchSoft is about to launch their first title, BarStar, which is a time management game about bartending
www.barstargame.com

Zeebu Mobile
(makers of SuperBabyGo! and other toddler games for BlackBerry)
www.zeebu.com

WickSoft
(exchange/sharepoint software for BlackBerry)
www.wicksoft.com

Magmic
(mobile games for BlackBerry - set to release Rubix and THK4)
www.magmic.com

QContinuum
(makers of Planets for iPhone and iPad, downloaded over 3M times)
www.qcontinuum.org

Our event has generated some local media interest and you can watch for the following coverage:

• CTV Ottawa’s Tech Now host Paul Brent is covering the event on channel 7, at 6:25 on Sunday night

• CBC Ottawa Radio at 91.5FM will be interviewing the event host Rob Woodbridge sometime between 7-8 am on Monday morning

• We also expect coverage in either the Monday or Tuesday online edition of the Ottawa Business Journal at www.obj.ca

You can also keep track of what attendees are saying about the event by following the Twitter hashtag #TONAppShow

This event is open to all members and non-members of The Ottawa Network. Click here to register and purchase a ticket for this event

Looking for seed money for your new venture? This TON Tuesday – another sell-out with 55 people attending – focused on how start-ups can access funding. Featuring a discussion moderated by James Smith at the LeBarge Weinstein offices in Kanata, Raymond Luk and Mark MacLeod discussed what you need to do to gain the attention of investors. Raymond, a classically trained musician, today owns Flow Ventures and a few other enterprises, and is currently working on developing hands-on workshops and mentorship programs for entrepreneurs. Mark, originally from Scotland, has spent 11 years arranging angel investment deals for entrepreneurs, now runs Startup CFO Enterprises. Here now a summary of their comments and advice for obtaining the funding you need to get your start-up out of the gate.

Reality Check

Today investors are different. “It used to be that you could go in with a concept and a business plan and get a $1M.” says Mark. “Today, those funds are not around. The investment today is smaller, and the bar is higher.” With $150K being the average investment, it means you have to work hard as a start-up to get the biggest bang for your buck. “If fundraising the first time takes 5-6 months, when it comes through you are right back to raising your next round. I believe mentoring with the right partners can help you make the most of your seed fund.”

Finding the Right Funds

“Ottawa angels haven’t been very active lately.” states Raymond. Your early research into the angels you want to reach out to is critical to your success. “Educate yourself…know the difference between angels and VCs.” Raymond recommends that you check out www.angelcapitalnework.com and the National Angel Capital Organization at www.angelinvestor.ca for more information. “You can cold call Angel Investors and make your pitch,” explains Raymond. “You can also go outside Ottawa – they(investors) are getting more outside their backyards now.” Some events in the US are even targeting investment in Canadian companies. “I love that Canadians can go to the US, get what they need in terms of funding, get successful and then come back to Canada as Angels!” says Raymond.

Raymond further explains that most angels don’t have access to entrepreneurs, and he is working to organize more meetings to get these two sides together. “A lot of them tweet, many have blogs – you can do your due diligence. The kimona is definitely open.” Raymond further stresses that investors work for you, and entrepreneurs do have the power in the relationship. “If an investor is difficult to get ahold of early on, they aren’t going to be good investors.” he cautions. Also a big no-no – paying to pitch. Raymond and Mark both agree, this is a waste of time and money. “Don’t hire a broker,” says Raymond. “Especially with early investment, it doesn’t work.”

To figure out the kind of financing you need, you have to know where you are today. “Angel investors or seed money is typically a lower investment,” explains Mark. This seed money is geared to get you off the ground. VC Funding is larger and should be your target when you are established with some traction and market penetration.

Being Attractive to Investors

For seed money, Mark stresses that it is better to go as early as possible. “Talk to investors about your plans, go away and execute, then come back and show that you did what you said you were going to do. Investors bet on the founder – your credibility and your brand are critical.” Raymond adds that your attitude towards investors counts for a lot. “If you’re friendly…people WILL spend time with you.” he says.

“There is a new Lean Start-up trend,” explains Raymond, and he advised TON to check out Steve Blank and Eric Ries and their funding philosophies. “Your goal as a start-up is to find a business model that works. Investors are paying attention to this and it will help you do a lot, with a lot less.”

Mark adds that first impressions mean a lot to investors and you should pay attention to how they react to your story. “If they are cold from day one,” explains Mark, “That doesn’t look good. If it isn’t love at first sight…move on!”

Options to Consider

An alternative to straightforward seed money, is convertible debt. “Sometimes, investors don’t want to value your shares and will walk away from a deal rather than have to do that.” explains Mark. Rather than lose the investment, you could consider convertible debt options. It works like this. The investor loans the corporation seed money and charges a healthy interest on that. When you gain your VC funding down the road, you convert the debt into discounted shares. This eases the investor’s jitters and gives them a solid return on their investment. Raymond cautions that some angels are uncomfortable with this arrangement, feeling that if they were the first ones to put their money into a venture, they should realize a full return, not a discounted one.

RECAP of TON Tuesday events are written by Patricia Heard, Director Client Relations, at HireSmart Human Resources Inc. If you don’t have professional in-house HR talent on your team, learn how you can save time and money and reduce risk to your company by contacting Patricia at pheard@hiresmarthr.com.

May 25, 2010, - 5:00-7:00 pm

LaBarge Weinstein’s Kanata offices
515 Legget Drive, Suite 800

Come hear about emerging trends in seed and early stage institutional financing, from Mark MacLeod and Raymond Luk of two new Montreal seed funding sources. The event will be moderated by James Smith and hosted at LaBarge Weinstein. Drinks refreshments provided.

Raymond Luk

Raymond is an entrepreneur and Angel investor based in Montreal. He runs Flow Ventures, a startup accelerator, and recently founded ArtAnywhere, an innovative art startup. He has built and managed a number of successful startups over the last decade and has been an executive of both private and public companies. Raymond is a well-known instigator of tech events including founding StartupDrinks Canada, the largest monthly networking event for startups in Canada. He is a Director of Symtext Corp., is the co-chair of the National Angel Capital Organization Summit for 2010, and a member of the Advisory Cabinet at Project Olympus, at Carnegie Mellon University.

Mark MacLeod

Mark MacLeod has been a CFO for numerous start-ups in the Montreal over the last 10 years, including most recently for Terapath, Tungle, Akoha and Status.net. He currently runs StartupCFO Enterprises - providing financial & strategic guidance and back office admin services for, you guessed it, start-ups, and he is one of the co-founders of Founder Fuel, a Montreal-based QC-government backed early stage opportunities fund.

Coming out of a recession, companies who cut staff as a survival strategy, today find themselves short on in-house talent. Even before the recession, many companies turned to outside suppliers of basic services to augment their in-house capabilities, cut costs and get into the market faster with their products. Should your company outsource parts of its operations? Which ones? When should you consider doing this? This Tuesday’s TON session, featuring a panel of outsourcing experts, helped answer these questions and more. The panel:

• Matt Massey, owner of drive2 Inc., helps customers drive sales and revenue goals through integrated marketing and demand generation strategies. www.drive-2.com
• Francis Liska, owner of OTUS Group, is a CGA who focuses on helping his customers improve their operations through sound business strategies and the ‘virtual CFOs’ he provides. www.otusgroup.com
• Frédéric Boulanger, President of Macadamian Technologies, provides his clients with software development from various branches world wide.  www.macadamian.com

The panel was kept in check and on track by moderator Janet Eastman who, with more than 20 years in media and communications, was more than up to the challenge with grace and good humour. Janet kicked off the discussion by informing the audience that a recent survey of US businesses with less than 100 employees actually have less than 5 employees…perhaps a great motivator for outsourcing!

The Benefits of Outsourcing

The work of running a business is time consuming and, as an entrepreneur or innovator, we aren’t necessarily the best choice for that particular role. Francis’ advice, “Find someone who is better at the task than you are.” Free yourself to run with what you are best at. “With so much information coming in from so many sources, plus the tasks you’ve got to move forward on…” there is just too much for one person to do, and you have to be able to hand it off to qualified experts.

“Money is a huge reason for outsourcing,” comments Frédéric, “but if that’s the only reason it’s not going to work.” The key is qualified experts: discover the skill level, the delivery time frames and that should all be part of the due diligence process. “Yes, cash is king,” says Frédéric, “but the right people have to be focused on the goal.” 

Getting value for every dollar is the start-ups challenge. “Outsource and find talented marketing specialists,” explains Matt, “and you’ll find a couple of times the value for your dollar.” Another benefit to an outside marketing resource is that they bring fresh eyes to your product. “If you’ve been involved with your technology for a long time you can be blinded by love… leverage outside eyes and experience.”

Do You Need a Virtual CFO?

A very good book keeper focuses on the day-to-day needs of banking and accounting. A skilled accountant will focus on reporting and what you need to comply with regulatory-wise. “80% of businesses fail because they don’t focus on financial information that is relevant to the objective.” points out Francis. “For example, if receivables are up,  is that because you have more sales or does that mean your collections are lagging?” The idea behind the virtual CFO is that you’ll have an interpretation of your financial data that will help you reduce costs, re-focus your spending, present your company in a good way to bankers and, if you are a start-up, it’ll get you off on the right foot.

Reinforcing this point, Frédéric adds, “I’m an entrepreneur, not an accountant. Dealing with raising capital, meeting CRA’s demands, complying with rules and regulations…” these are all critical to your success and if you don’t have it under control you should find talent that will help you reign it in.

When Should a Company Outsource?

Sooner is better! “They always come too late… when the problem is about to burst!” says Frédéric. “Spend an hour or two with an outside consulting company and they’ll help you ask better questions and make better decisions that will save you a ton of cash down the road. A problem caught before product release is far less costly.”

Deciding when to outsource is a balancing act of timing and budget. “Size is not the issue,” explains Matt. “if (your outsource resource) provides value, if you trust them and if they’ve saved you money, why change this relationship?” Entrepreneurs have to look at long term strategy and short term tactics and determine if developing in-house talent is worth the pain. “Go outside for expertise, nimbleness and cost,” says Frederic. “Think of these partners as more of a team.”

“Don’t reverse-engineer your finances.” recommends Francis. Thinking about your credibility with financers, a virtual CFO can help you prepare. “Put the right infrastructure in place from the start. We see organizations struggling with investing and we help them become more attractive.”

How Do You Find and Work With the Right Outsource Talent?

It’s easy to find a supplier – finding the RIGHT supplier is what you must do to have a successful outsourcing relationship. The key points:

1. Get Referrals:  “Reputation is everything, especially in our business.” explains Frédéric. “People love to work with people they know, or people who have been referred to them. Ask for help!”
2. Communicate: Trust in your outsource partner is a huge factor to the success of the relationship. Each of the panel expressed the need for openness, honesty – that transparency in the relationship where you feel your outsource partner will tell you the truth, even if you don’t want to hear it. “Clarity about the expectations and the delivery…you need candid answers when things aren’t going as expected.” Stresses Francis. Matt adds, “It is critical that both sides are able to have a back-and-forth, without avoidance on either side.” Frédéric recommends you put aside email or text messages and go for a more direct approach. “The manager of the outsource relationship has to have the ability to pick up the phone and communicate directly with the provider. In an email, only a tiny bit of the communications come through.”
3. Establish an Accountable Partner Relationship: “In the development world, I strongly advise an accountability-based relationship.” Says Francis. “Everything needs to be done in stages…get benchmarks on a regular basis so you can correct issues early in the process.” Matt stresses the need for the partners to follow the plan. Tweaking is allowed, but changing everything in reaction to a bad report in the press, for example, distracts from the plan and delays results. “The client has to value the direction you are taking them.” says Matt.

What is the Budget for Outsourcing Marketing and Finance?

It comes down to needs. Francis advises companies to look objectively at the senior management team and infrastructure and be honest about the strengths and weaknesses. Identifying what a company needs in order to be able to advance to the next level of business growth, then budgeting around that need.

In marketing, you can budget several different ways from the cost of the product to the revenue being generated to the projected revenue.  “At drive2,” says Matt, “We pro-rate up-front costs and look for a % of gross revenue as successes happen. Most CEOs like to know that if they’re outsourcing, they are partnering with someone who is compensated based on success.”  Understanding the metrics helps you identify a budget and Matt advises companies to think about allocating marketing funds in terms of percentages of revenue.

Special Note: No TON Tuesday on June 8, but a Summer Cocktail Reception is planned for June 27.

Gowlings Monthly TON “Starting your Start-Up Series” Presents:

(160 Elgin Street, 26^th Floor)

Virtually Yours:  Building a Winning Team through Outsourcing

As access to capital continues to be a challenge for Ottawa Hi Tech Start-Ups, more and more companies are adopting the virtual and outsourcing business models.  R&D, production, staffing, sales/marketing, legal and finance are just some of the areas where you can have experienced resources without the costs associated with full time employees. Companies who adopt outsourcing are founded on the concept of focusing on doing what they do best, running lean, and building their IP and capabilities with the help of more experienced outside virtual resources

Please join us on May 11^th to hear an expert panel on outsourcing moderated by accomplished Ottawa Tech Media expert, Janet Eastman.  During this seminar, we will discuss various topics, such as how opportunities for outsourcing of non-core services have made the “virtual” company structure more achievable, and how these opportunities might be particularly relevant for Ottawa Start-Ups.   

Gowlings is very pleased to host Starting Your Start-Up, The Ottawa Network monthly event stream that combines quality networking with practical advice and insights from industry leaders and subject matter experts.   Starting Your Start-Up focuses on the business basics that are the foundation for launching and building a successful start-up in these promising and challenging times including financing, team formation, business & product development, sales, and marketing.

RSVP today, as space is limited.  This event is provided at no cost for members of The Ottawa Network.

Please click here to register

Moderator - Janet Eastman

Janet Eastman is a media & communications expert who has worked extensively on both sides of the industry during her more than 20 year career.   Janet began her career in radio as a broadcaster and quickly moved into writing and television media.  In 2001, Janet became the host and producer of the only independent Canadian Business Television program; Ottawa Citizen Business TV.   After a successful 6-year run and over 1100 shows, Janet left Ottawa Citizen Business Television and evolved her career as Manager of Communications and Investor Relations with publically-traded Orezone Gold Corporation.

Janet joined drive2 Inc, in 2009 as Director of Media and Communications where she works with drive2’s customers to develop effective communications, brand and PR strategies and tactical messaging for our customers.   Janet is a storyteller at heart who has produced local and national radio documentaries and television programs, newspaper and magazine articles.  Her experience allows her to take often complex, hard to understand technology and effectively define and translate it into relevant, make sense communications and content.

Panellists

Frédéric Boulanger, President, Macadamian Technologies

As President and co-founder, Frédéric is responsible for Macadamian’s long-term vision and strategic direction. Under his leadership, Macadamian has grown from four founders to a team of more than 130, known as one of the most respected software development firms in the industry.

Frédéric is on the executive committee of the Ottawa Software Cluster, and is co-founder and co-executive of the Ottawa Software Executive Forum, an Ottawa-based networking group that brings high-level software executives together to share best practices, exchange ideas, and explore new technologies. Frédéric is also a board member of the Information Technology Association of Canada (ITAC) and is active in a number of ITAC committees, including outsourcing and Canada’s competitive positioning.

Prior to founding Macadamian, Frédéric was the Senior Development Manager of Paradox, Corel Corporation’s flagship database product. There, he managed the first release of Paradox after Corel acquired the relational database management system from Borland. His team successfully tackled an unfamiliar code base and met an aggressive deadline, developing a new version of the complex application in eight months. Frédéric also managed Corel Family Tree Suite, which received the ZDNet Editor’s Choice award.

Francis Liska

Are you looking for sustainability in your business? Francis has a passion for learning and sharing ideas. He is a strategic thinker who excels at carefully considering alternative scenarios to find solutions in a world of seeming complexity.

Francis holds a degree in Business Administration and a Post Graduate Diploma in Applied Information Technology. He is a Certified General Accountant, Certified Information Systems Auditor, Certified Internal Control Auditor and a Certified Management Consultant. He also holds the COBIT Foundation Certificate from the Information Systems Audit and Control Association.

Francis is an owner of OTUS Group, a firm of business advisors dedicated to making businesses stronger. Over his career he has helped numerous organizations in the government, entrepreneurial and not for profit sectors to improve their operations.

Matt Massey

Matt Massey has spent the majority of his career building new revenue opportunities for business-to-business organizations.  He is an enthusiastic, highly talented marketer with a passion to succeed. 

Matt founded drive2 Inc. in 2006 to assist small and medium-sized enterprises in getting in front of the companies they want as customers.  Driving sales and revenue and better positioning drive2’s customers for growth and success.  The foundation of drive2 is based on a philosophy that smart, integrated marketing infrastructure coupled with effective demand generation programs drive sales effectiveness and revenue goals.

drive2’s Demand Generation Model has a proven track record for success. In the last 10-months alone, Matt and his team have successfully generated over $11 million in qualified new business opportunities for their customers.

Matt is a contributing author of Guerrilla Marketing for Job Hunters 2.0, is actively involved in the community and volunteers with a number of charitable organizations.

Click here for registration details.

How are your sales? If you believe your company could be more effective at selling your products or services, attending last night’s TON session with Trevor Wilkins, Principal of Holis Associates Inc., would have been a great start. Trevor is an Engineer turned sales professional who has practised sales for the last 25 years. Today, owner of Holis Associates Inc., Trevor delivers training programs all over the world. Graciously delivering a small segment from his full curriculum, Trevor battled a severe ear and throat infection to explain to TON how to structure a sales meeting for success.

Attended by start-up owners, marketing and sales professionals, established business executives and one lawyer, this TON session was a huge success. Here now, a brief recap of the main learning points from Trevor’s presentation.

Point One: We are all salespeople.

Trevor drove home the point that everyone sells – to family, friends, clients, suppliers, employees – we’re all selling all the time. We use different methods with different people to persuade them, convince them to our viewpoint. “Start-ups,” says Trevor, “Don’t have time to wait for the customer’s process. Start-ups have to take control of the buying process and drive the sale from the beginning.”

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