THE NEXT BIG THING

THE IDEA

So, you think your idea has what it takes? Well, do me favour and don’t ask mum and dad what they think. Mummy and daddy will always protect their babies and you will always get a biased opinion.

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Get to Ryman, buy yourself a clipboard and gather some questions together. Get that ass out on the street and find out what the public think of your idea. If your idea requires business approval, start contacting companies – the bigger the better. You’ll find that people are always interested in hearing about new products and ideas.

When talking to businesses it’s a must that you make sure you get these businesses to sign what is known as a Non-Disclosure Agreement or Confidentiality Agreement. It gives you some protection and discourages these businesses from taking off and copying your idea. Any business that declines to sign an agreement isn’t a business that you should talk too or work with.

You can find these types of agreements from searching Google. But below is a link I prepared earlier ;-)

http://www.docracy.com/application/dochome

THE RELATIONSHIP

The world is built on relationships, it doesn’t matter who you are, where you’ve come from, or where you are, you’ve got there from some form of relationship – whether it be from gathering some investment money or from a business or consumer buying your product.  Everybody has some form of connection, some of which can be capitalised on and used to your advantage – so building the right relationships and networking intelligently can be an invaluable tool to building your business.

You need to make sure you build the right team around you and make sure you find the right contacts to move your idea forward. A real entrepreneur understands that they can’t do everything themselves. Real entrepreneurs recognise their pitfalls and bring in the right people to support them in these areas.

To make sure you find the right movers and shakers you must find the right companies to accompany you on your journey, these include:

  1. High quality, reputable accounts
  2. A high quality attorney, who will work for you and not by the hour

Your accountant and attorney will need to be forward thinkers, not people who are just looking at what they can get from you at present, but further in the future when you’re generating a high income or looking to possibly sell the business, and so forth. This doesn’t mean you should expect to get them working for you for free now, but it should be at a considerably knocked down price.

THE SCHEME

The government is striving to help small businesses whilst simultaneously protecting investors who are willing to take risks with their money on these businesses. There are currently two schemes available.

  1. Seed Enterprise Investment Scheme (SEIS)

Private Investments through the SEIS can input £100,000 in a single tax year which can then be spread over a number of companies. However, none of the companies can raise more than £150,000 in total via the SEIS investment. Investors cannot control the company receiving their capital and have more than a 30% stake in the company. Investors can receive up to 50% tax relief in the tax year the investment is made, regardless of their marginal rate. The company receiving investment must also be registered in the UK and have fewer than 25 employees.

In the 2012-13 tax year, tax payers could roll a chargeable gain on the disposal of assets in the tax year in to shares qualifying for SEIS income tax relief, with full capital gains tax exemption. If the company is the parent company of a group, that figure applies to the whole group. The company’s trade must be no more than two years old, and the industry must have assets of less than £200,000.  The company would also need to trade in an approved sector – generally not in the finance or investment industry, such as, for example, a property company that raises capital as SEIS.

  1. Enterprise Investment Scheme (EIS)

EIS offers tax incentives to investors buying shares in companies that find raising money from banks difficult because of their short trading history or risky business sectors.

An investor’s income tax liability is reduced by 30% of the amount spent on subscribed shares for the year the shares were issued. An investor cannot sell EIS shares until three years after the date of issue or, if it’s later, three years after the company has started trading. As long as the EIS relief has not been withdrawn, no capital gained tax is payable when the shares are sold. If the shares are sold at a loss, then the investor can set that amount against income made in the year, less any income tax relief. The investor does not need to be from the UK when shares are issued, but will need to be paying income tax in the UK. Other restrictions include: investors cannot have any connection with the company or employees, nor will they be able to gain tax relief if investing in the company they work for.

In any 12 month period, an EIS company can raise a maximum of £5 million but this figure also includes money raised via a corporate venturing scheme and a venture capital trust scheme.

To comply with the rules for EIS relief, the share issuing company, and its subsidiaries cannot employ more than 250 people.

THE DOCUMENTATION

When you start analysing the data you’ve obtained from consumers and / or businesses it is time to start building your documentation to support you when you go out looking for investment. These include:

  1. Company Overview – This is a maximum of two pages. It should detail the following:
    1. Who you are
    2. How you came up with the idea
    3. What the idea is
    4. Summarised analysis from your research
    5. Determine the right investment scheme for the investor and protect as much money as possible through these schemes
    6. How much you need
    7. Full Business Plan
    8. Marketing Plan
    9. Financial Plan and Forecasting for 1-3 years

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THE MONEY

The old model of getting your family and friends to invest in your idea is dead and quite frankly, thank god! For far too long parents, aunts, uncles and so on, have been investing in their family businesses mainly because they are relatives and therefore view the potential business with rose tinted glasses. Investments made by friends and family have unfortunately caused too many crap business ideas to come into fruition, many of which have often resulted in family break ups when they end up going disastrously wrong.

This is the stage where your accountant and attorney come into hand, and if they can’t help you here it’s time you found yourself someone new.

Your accountant will advise you on the best scheme available for investment and should get you approved. Once approved your accountant should help you by providing your information to wealthy business investors who favour these types of investments. The accountant won’t be able to recommend the investment, but the fact that your plan is presented in front of the investor in the first place……

If a suitable private investor cannot be found then it’s time to start looking at crowd funding. Crowd funding describes the collective effort of individuals who network and pool their money, usually via the Internet, to support efforts initiated by other people or organizations.

Don’t panic, the fact you’ve got your SEIS or EIS approval is still a bonus as more and more private investors are now investing through crowd funding websites.

Some crowd funding websites that have featured in the news, include:

  • Crowdfunder.co.uk
  • Crowdcube.com
  • Wefund.com
  • Kickstarter.com

Crowd funding is a great way to get yourself funded. Usually you have 90 days to gain your investment at a cost of 3-5% for the overall investment cost.

THE NEGOTIATION

Negotiate on everything…I do!

It doesn’t matter if you’re buying a pint of milk or a desk. Research the best prices using the phone, people you know and the internet. You never know who may be able to help you with setting up your business.

When you have an investor making an investment through one of the above schemes remember this, this is your bargaining chip. Investors have protected their investment whether it goes north or south, so no signing over 20 or 30% of your business.

THE HIRING AND BUILD

So you’ve found the right accountants, attorneys and you’ve found your cash. Now you’re at the stage where things are concrete and you need to start hiring for positions, which is the really tricky part.

Due to a poor education system and a lack of investment into computer science in the UK, this has created a developer vortex leading to poor developers charging extortionate amounts of money offering B-grade skills. One great option is to team up with a reputable university who can present you with graduates suitable to your requirements, which evidently aids you in your cause.

The alternative and an increasingly popular route to take would be to gain the knowledge required yourself. A growing range of code teaching websites can now teach you, Codecademy is a great example of this.

THE MARKETING

This is the fun part, telling people about your new idea. Of course only once it has been developed.

GO DIGITAL

The best and most effective way to market your business to reach the most amount of people in this day and age is to take advantage of digital marketing. Set healthy budgets for your advertising on:

  • Google
  • Bing Ads
  • Facebook Ads
  • YouTube

Start building a blog to post information on changes/developments within your business, which will also allow other businesses and consumers to engage with you on your website and follow your company’s progression.

SUMMARY

The process you have to go through to become the next big thing can be pain staking, but at the same time it will be the most enjoyable thing you will ever do. If you have the right idea, build the right team around you and keep things simple, the world is your oyster.

GOOD LUCK!

N.B – None of the above should be construed as advice and I am not liable for any problems you may incur along your journey setting up your business. Each and every person’s experiences are completely different.

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WHERE WOULD WE BE WITHOUT…

To know where we are going, we need to understand where we’ve come from. Something the tech world seems to have forgotten. In this blog I want to talk about the influential technologists who have been and past.

These four have shaped computing today.

These four have shaped computing today.

Alan Turing

Alan Turing was one of the most influential men in computing history, and passed away in 1954 of a self-inflicted cyanide poisoning. Turing was a London born mathematician, logician, cryptanalyst and computer scientist, and without him the computer as we know it wouldn’t exist today. Turing was the first man to give a formalization of the concepts of an algorithm and computation with his ‘Turing Machine’, which is considered the model of a general purpose computer. Turing is still considered to be the father of computer science and artificial intelligence today.

During World War II, Turing worked for the Government Code and Cypher School, Britain’s code breaking centre. For a time Turing was head of Hut 8, the section responsible for German naval cryptanalysis. Turing devised a number of techniques for breaking German ciphers, including the method of the bombe, an electromechanical machine that could find settings for the Enigma machine.

Following the war, Turin worked at the National Physical Laboratory, where he designed the ACE, the first design for a stored-program computer.

Turing had a remarkable mind, which enabled computer engineering to move forward.

Dennis Ritchie

Dennis Ritchie was part of a select few who took the foundation of Turing’s work and “helped shape the digital era.” Ritchie created the C programming language and, with long-time colleague Ken Thompson, the Unix Operating System.

In 1983, Ritchie and Thompson received the Turing Award from the ACM, the Hamming Medal from the IEEE in 1990 and in 1999 the National Medal of Technology from President Clinton. Ritchie was the head of Lucent Technologies System Software Research Department when he retired in 2007. Ritchie was the ‘R’ in K&R C and commonly known by his username dmr.

By developing the UNIX Operating System and C language, it gave technology legends such as Bill Gates and Steve Jobs the possibility to develop the formidable Windows Operating System, the programs which are used today, along with text languages. Without the development of C language, societies would currently be reading in binary in present day.

Bill Gates

Bill Gates, a Harvard drop out is currently the former chief executive and current chairman of Microsoft, the world’s largest personal-computer software company, which he co-founded with Paul Allen.

From Microsoft’s founding in 1975, Gates had primary responsibility for the company’s product strategy. Gates aggressively broadened the company’s range of products, and whenever Microsoft achieved a dominant position, Gates vigorously defended it.

After reading the January 1975 issue of ‘Popular Electronics’ that demonstrated the Altair 8800, Gates contacted Micro Instrumentation and Telemetry Systems (MITS), the creators of the new microcomputer, to inform them that he and others were working on a BASIC interpreter for the platform. In reality, Gates and Allen did not have an Altair and had not written code for it; they merely wanted to gauge MITS’s interest. MITS president Ed Roberts agreed to meet them for a demo, and over the course of a few weeks they developed an Altair emulator that ran on a minicomputer, and then the BASIC interpreter. The demonstration, held at MITS’s offices in Albuquerque was a success and resulted in a deal with MITS to distribute the interpreter as Altair BASIC. Paul Allen was hired into MITS, and Gates took a leave of absence from Harvard to work with Allen at MITS in Albuquerque in November 1975. Gates and Allen named their partnership “Micro-Soft” and had their first office located in Albuquerque. Within a year, the hyphen was dropped, and on November 26, 1976, the trade name “Microsoft” was registered with the Office of the Secretary of the State of New Mexico. Gates never returned to Harvard to complete his studies.

Microsoft’s BASIC was popular with computer hobbyists. Microsoft became independent of MITS in the late 1976, and it continued to develop programming language software for various systems.

During Microsoft’s early years, all employees had broad responsibility for the company’s business. Gates oversaw the business details, but still continued to write codes. In the first five years, Gates personally reviewed every line of code the company shipped, and often rewrote parts of it as he saw fit.

Microsoft launched its first version of Windows on November 1985, and in August, the company struck a deal with IBM to develop a separate operating system called OS/2. Although the two companies successfully developed the first version of the new system together, mounting creative differences caused the partnership to deteriorate. The partnership ended in 1991, when Gates led Microsoft to develop a version of OS/2 independently from IBM.

The Windows Operating System is now on its 8th generation, with the most recent, up-to-date launch of Windows released on the 8thOctober 26, 2012. Windows can now be found not only on personal computers but on mobile, laptops and tablet. Without both Gates and Allen’s development of Windows, more than 2 billion people would be without an Operating System for their computers, laptops, tablets or mobile phones.

Steve Jobs

Steve Jobs is best known as the co-founder, chairman, and CEO of Apple Inc. Through Apple, Jobs was widely recognized as a charismatic pioneer of the personal computer revolution, along with his influential career in the computer and consumer electronics fields, transforming “one industry after another, from computers and smartphones to music and movies…” Jobs acquired and served as chief executive of Pixar Animation Studios from Lucas Film; additionally Jobs became a member of the board of directors of The Walt Disney Company in 2006, when Disney acquired Pixar.

In the late 1970s, Apple co-founder Steve Wozniak engineered one of the first commercially successful lines of personal computers, the Apple II series. Jobs was among the first to see the commercial potential of Xerox PARC’s mouse-driven graphical user interface, which led to the creation of the Apple Lisa and, one year later, the Macintosh. Jobs also played a role in introducing the LaserWriter, one of the first widely available laser printers, to the market.

Following a power struggle with the board of directors in 1985, Jobs left Apple and founded NeXT, a computer platform development company specializing in the higher-education and business markets. In 1986, Jobs acquired the computer graphics division of Lucasfilm, which was spun off as Pixar. Jobs, who was also credited in Toy Story (1995) as an executive producer, additionally served as CEO and majority shareholder until Disney’s purchase of Pixar in 2006. In 1996, after Apple had failed to deliver its operating system, Copland, Gil Amelio turned to NeXT Computer, and the NeXTSTEP platform became the foundation for the Mac OS X. Jobs returned to Apple as an advisor, and took control of the company as an interim CEO. Jobs brought Apple from near bankruptcy to profitability by 1998.

As the new CEO of the company, Jobs oversaw the development of the iMac, iTunes, iPod, iPhone, and iPad, and on the services side, the company’s Apple Retail Stores, iTunes Store and the App Store. The success of these products and services provided several years of stable financial returns, and propelled Apple to become the world’s most valuable publicly traded company in 2011. The reinvigoration of the company is regarded by many commentators as one of the greatest turnarounds in business history.

Jobs received a number of honors, along with public recognition for his influence in the technology and the music industries. He has been referred to as “legendary”, a “futurist” or simply “visionary”, and has been described as the “Father of the Digital Revolution”, a “master of innovation”, and a “design perfectionist”.

Conclusion

Without the development timeline of Alan Turing and Dennis Ritchie neither Bill Gates nor Steve Jobs would have been able to change the computing world like they have or did in Steve’s case.

There are too few people in the technology world that understand the history behind the computers they use or the programs that allow them develop on. These four individuals discussed in the blog made computer science, technology and the hardware we use today – without them, the world would be a very different place.

Reference

Alan Turing – The Enigma of Intelligence – Andrew Hodges – ISBN-13 978-0691155647

Dennis Ritchie – Various Internet Articles and Blogs

Bill Gates – Bill Gates Speaks – Janet Lowe – ISBN-13: 978-1559352871

Steve Jobs – Steve Jobs – Walter Isaacson – ISBN-13: 978-1408703748