ClaimAir

Claimair: Fighting For Air Passengers’ Rights

ClaimAir helps travelers fight the airlines for compensation, because fliers don’t have the time and resources to do it themselves.
It’s is an automated platform that handles the end-to-end process of claiming owed compensation for delays, baggage mishandling, etc. Did you know that the average compensation owed was over 300 Euros?

I sat down this week with Jakub Ladra, Founder and CEO of ClaimAir, one of our 2016 Startups. Here’s what he had to say about fighting for the rights of passengers all over the world:


Hi Jakub, tell us a bit about ClaimAir, and why you decided to fight for the rights of airline passengers.

Hi Lloyd, thanks for asking. Let me ask you a question: the last time you had a flight delay, or a lost bag, how much money did the airline give you in compensation?

Now, if you’re like most people, the answer is that you didn’t get anything, or maybe the airline gave you enough money for a meal at the airport. But what people don’t know is that the airlines routinely owe much more, often hundreds of euros per person, for a delay or mishandling of bags.

ClaimAir makes sure travelers get flight and baggage compensations when they are lawfully owed by the airlines. Since ClaimAir works as an automated platform which allows us to process claims in high volume, we can provide our service not only directly to the travelers but also to our business partners.

These partners are companies like flight booking platforms, travel agencies, travel itinerary management systems, etc. We believe that our service can help them improve customer relationships, loyalty and last but not least, it gives them a strong competitive advantage. On the other hand, these partnerships help us to overcome our biggest challenge, which is the fact that travelers are not well aware of their rights and airlines usually take advantage of it.

 

Jakub Ladra, Claimair

Jakub Ladra of ClaimAir. Jakub has extensive experience in the airline industry, and wants to fundamentally change the way airlines treat their customers.

Back to your second question, my journey with air passenger’s rights started at the university when it was the topic of my thesis. It was in 2007 and no surprise, the thesis ended up in a box – luckily, not forever. I went through a couple of aviation-related corporate jobs, but I always knew it wasn’t what I wanted. I love the startup environment and the feeling of freedom which, in combination with my knowledge, naturally led to ClaimAir.

Do you see your mission as more than just taking advantage of the laws and regulations?

For us it’s not just about taking advantage of the laws and regulations. We live in an experience economy where customer service should be a priority. Trouble with your flight just happens, and obviously brings a lot of stress and frustration into your life. So our goal is to make the rules around air passenger’s rights as clear as possible and make air travel an even more comfortable way of exploring the world. We also have some plans that don’t relate to the regulated stuff, but I can’t tell you more at the moment.

What are some of the most common mistakes that air travelers make when it comes to getting what is owed them for delays, disruptions, and lost bags?

I wouldn’t call them mistakes. Travelers simply don’t know they are owed compensation and that airlines are in fact legally obliged to pay them out. For instance, when your flight is delayed for more than 3 hours on arrival, you can get €600 paid in cash. Regarding the baggage, the compensation can be up to €1,500. These are pretty good sums that airlines wish to be kept secret. Moreover, when you complain by yourself, the airline usually responds by using complicated legal arguments that you have no chance to understand and work against. The average traveler feels powerless next to the airlines.

What does it take, legally, to get an airline to pay legal compensation? Why is it so hard?

Naturally, it’s a common practice of a majority of airlines to keep their compensation budgets low. Therefore, if you don’t know the rules precisely and if you are unable to submit a strong letter of complaint by using relevant legal arguments, your chances to success are close to zero. The airlines usually respond by using some tricky legal provisions that exempt them from liability, but most of them are taken out of context. Overall, the legislation is damn complex and contains many grey zones, so it’s just difficult for an ordinary traveler to cope with it.

Let’s talk a bit about the numbers. How many travelers a day could benefit from your service? What are some of the other important industry stats?

Although I’ve devoted my professional career to aviation, I’m always amazed about those daily numbers. There are more than 9 million travelers transported by air every day and approximately 800 thousand of them are affected by any kind of flight disruption or baggage mishandling. It’s also worth mentioning that the average compensation we got for our customers in 2015 was €320. There are also projections that air travel industry should double in next 20 years.

Your team is growing quickly. What do you see as your biggest challenge as a company in the near term? What keeps you up at night right now?

A: Extremely quickly! If everything goes well and in line with our plans, we should have more than 100 employees by the end of 2016, which is the thing that actually keeps me up at night these days. Have I mentioned that we are hiring? (laughs)



What kind of people are you looking for?

Anybody who speaks fluent English, has a passion to learn new things from the aviation industry and is willing to use the latest technology is more than welcome to reach out. We are currently based in Prague, but our goals are far beyond the borders of the local market. If any of your readers want to be a part of an international startup environment with a vision and strategy to create something big, I can’t wait to meet them.

Where do you plan for ClaimAir to be, as a company, in 5 years time? What will be your mission then?

We’re still an early stage startup so I primarily hope that we will still exist in 5 years. (laugh) But anyway, I have a clear vision of a perfectly seamless process of customer care that I would love to bring into life.

I would really like to have our service integrated with various travel solutions, so every time your flight goes wrong, we would automatically notify you about important facts and we would get you money without any intervention from your side. In other words, we would like to solve your traveling troubles in real time so you can feel secure, and as a bonus, the compensation will be automatically credited to your bank account.

Have any of the StartupYard mentors had an especially powerful impact on your trajectory as a company? How so?

jakub ladra, Claimair

Jakub talks with other 2016 founders at a StartupYard workshop


Not only mentors but all StartupYard team members, including you Lloyd, are extremely supportive and dedicated. I can’t thank you enough for allowing us to be here and for supporting our goals. I am sure that we wouldn’t make such a progress in just a few weeks otherwise. We’ve met more than 70 extremely experienced mentors yet and sorry, I can’t mention anyone in particular because I value all of them the same. They are busy professionals and they give us their precious free time to move our businesses forward. We got numerous valuable insights into our business as well as several important introductions to our potential business partners. I’d definitely recommend other early stage startups to do their best to make it into the next StartupYard’s batch.

This space has some active players already. Why is there room for ClaimAir in this market?

Of course, but I always find competitors as an important part of every industry. Their presence confirms that our business is viable and they also help us educate and evangelize the market. Why is there room for us? Remember the figures? 9 million travelers are transported by air every day. Moreover, we are the only ones who deal with baggage-related issues and I hope that our focus on a technology will quickly make us one of leading players.

Are you looking to raise investment right now?

Yes. In order to carry out our business plan, we are looking for an initial €300k investment.

liva judic

Liva Judic: Storytelling Between the Lines

Liva Judic is a financial journalist turned entrepreneur. Born in Madagascar, she was educated in Europe and has lived and worked across 4 continents. As a StartupYard mentor, Liva stresses efficient communication, and connecting emotionally across cultures by telling compelling stories that resonate with all audiences. She works individually each year with our startups to open up new avenues of storytelling.
In 2010, Liva founded Merrybubbles Communications to help fuel the fire for technology startups wanting to expand internationally. She lives in Miami Beach and shuttles between there, New York, San Francisco, London, Paris and Berlin.

I caught up with Liva  after her latest mentoring session with the StartupYard 2016 teams, to talk about her views on the industry, startups, and storytelling. Here’s what she had to say: 

Hi Liva, welcome to our blog. Is there anything you’d really like people to know about you, that they can’t find out by reading about you on LinkedIn?

Hi! What’s not showing through my LinkedIn… a lot of things, actually. The thing that I really want to share and is connected to what I do with StartupYard is that I’m passionate about design, aesthetics, especially minimalistic approaches. You can see it through my Instagram account, mostly, and my personal site LivaJudic.com. In terms of work, it transpires in the way I approach things, notably how I structure my interactions with businesses and startups. Short and laser-focused with the goal to make a lasting impact on their progress.

You founded Merrybubbles (the branding and communications firm) in 2011. What was the original vision for the firm? How has that evolved?

At the beginning, the idea was to provide my international experience and journalistic background to companies needing to open their outreach to foreign markets, notably English-speaking ones and mostly the U.S. Our first client was GDF Suez Trading and from there on, we started working with startups with ambitions to move to the U.S. in general. We pivoted, as per startup language, last year from an all-marcoms approach to a strictly branding offer, both strategy (which precludes all communications for any company) and implementation. And instead of purely startups, we have both narrowed and widened (I know, sounds contradictory but you’ll see what I mean) our focus to change makers/game changers. It means first, recognizing that small businesses and startups with women or minorities at their helm are a force to be reckoned with: they are innovators, just because of that leadership choice. It also means that we want to find businesses/startups with technologies or products that are making an impact on their ecosystems, improving quality of life, one way or another.

What makes Merrybubbles different from a typical branding and communications agency?

We only offer one product now (see, the narrowing down is surfacing…) Our approach is very streamlined to ensure maximal impact and ROI for our clients: we only sell one product. Yes, really. We work in a two-step process: we first lead a discovery and analysis of the business/startup in order to put together their brand identity and give the client the one-pager blueprint at the end of the very same day. That’s what we call Primer. Then, we narrow it down with them to execute on it: we ask specifically that the client has access to a screen (phone, tablet or computer) during business hours so we can communicate with them seamlessly for the following four days after Primer. At the end of that fourth day, they will leave with a logo, website, 4 social media profiles or pages of their choices, business card design and a one pager or a landing page for their specific need. In five business days, they are ready to launch.

You emphasize that Merrybubbles is focused on women and minority led organizations, yet you also mentor at the very male, very European StartupYard. Women make up a huge part of the market for emerging tech products, but we’ve struggled to attract women entrepreneurs to our program since the beginning. What could we be doing better, from your perspective?

Bear in mind that I’ve always worked (and thrived because it never bothered me) in male-dominated industries: financial journalism, diplomacy and government, tech startups. So being with StartupYard is not something out of the blue. I’m always happy to represent women in areas where there are so few of us, and it’s part of my thinking to actually organically integrate where women are scarce, a bit like a statement that we can do it: if I can do it, we all can.  

What I would say is that StartupYard has three points of leverage. One, you can onboard more female mentors. There are a lot of women with incredible track records out there who would be amazing adds to your roster of mentors. Number two, encourage applicants who have women in their teams or at the helm of those teams. How you do that is by communicating your awareness and support for more diverse teams. I know there are great diverse teams in Eastern Europe. I have met a few, especially when I am in Berlin, where I spend a fair amount of time. One was from Croatia and is now doing quite well for themselves, as they went through YC.

And of course, what you’re doing now, by giving me this opportunity to speak, is a great first step! Let’s keep doing more such things, I’ll be happy to support your efforts.

You emphasize storytelling in your startup mentorship. What does good storytelling mean to you? Why is it so important

Let’s see. You meet a stranger and s/he tells you a story, random conversation. It’s really not bad. You part ways. Then, on the same day, you meet another stranger. S/He also tells you a story. But this time, it actually makes you laugh, or it reminds you of this one adventure you went on with friends a while ago where you had felt so empowered, or it made you shiver… you part ways. A week after, you are telling a friend about that weird day where you had random conversations with two complete strangers. You can’t remember their names. Not really. But the one thing that you will remember is how that second stranger made you feel. That will stick with you. And you are able to tell the story s/he shared with you that day. The first story? Maybe vague details.

Now, apply that to startups and pitches. Instead of you, the recipient of the stories are investors or users. That’s why it’s so important. You weave your story to make an emotional impact and that’s how you relate to your audience. That’s why it’s crucial to nail your branding: it’s not just the logo and marketing collaterals, it’s the unsaid, what is between the lines that will make your story the best — it’s what is invisible but can only be perceived emotionally.

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We hear quite a lot about “branding” these days. What does branding really mean to you, and what should it mean to startups in Central Europe?

I think my previous response gives you a good idea of what branding should be. Don’t focus just on your logo or website as objects. Focus on them as a medium to convey the full experience of what you offer. This is why, for instance, we offer the Primer phase: we find out everything about the startup, its team, its values, its mission, its goals, but also the story of how the team member got together, what glues them together. We want to find out what makes them tick, what they hate. Of course, we want to see their vision. I always tell clients that we are exploring their full universe in order to be able to activate all 5 senses. Touch, feel, smell, see, taste. That’s how we are able to then build a brand identity that aligns with the startups’ values and culture. As regards startups and businesses from Central/Eastern Europe, this is how they can be authentic and genuine — and that, in turn, will allow them to be universal, go to foreign markets.

We often hear that European startups are “behind” those in the US or in Britain, particularly as it concerns marketing principles and communication skills. Of course the real picture is more subtle. Do you think there are mistakes in the overall narrative that US startups are “ahead” of others around the world?

It is a reality that the level of maturity of startup ecosystems around the world are different. It’s like with electronics. Do you remember the beginning, when the U.S. was making calculators, fax machines and even computers? What was the economic phase in Asia? It was copying. Then comes innovation, they started iterating faster, then took over: look at what happened with Samsung, for instance. You can’t burn through the stages, it takes time. It’s not just the startups, it’s also investors. In a place like Berlin, investors are still very shy and the startups are still used to presenting perfect solutions instead of MVPs to those investors. So their development phase is slowed down by a lack of funding. In the meantime, investors in the U.S. have had quite some time to become familiar with the startup ecosystems. They are bold and bet very early on, even at the stage of ideas, with no product yet. I’m not saying it’s better, it’s just different paradigms.

One thing that is VERY important to be aware of, however is this: regardless of the maturity of the market, developers in Europe, and more specifically in Central/Eastern Europe, are extremely skilled. Proof is, some of the most successful startups in Silicon Valley have gone through the process of working with remote teams from the region.

It’s important to look at the whole ecosystem, not just one side.

You met with the StartupYard startups recently. What did you learn from the experience?

This is my second year mentoring at StartupYard. As you asked me before about startups in Europe vs the U.S., I have to say that the level of maturity of this cohort is striking. Last year, they were good, and this year, they are even better. I’m not bashing on last year, no, that’s not what I mean. On average, the level of readiness overall, for seed stage startups, was pretty damn good. I am still involved with some of last year’s batch. You know, it’s also about who you click with. I believe a few of them will do really well. And this year is no exception. I’m very happy to be a mentor for StartupYard and very grateful for this opportunity too.

 

Satismeter: Meet the Founders

SatisMeter is perfect for online businesses that lack qualitative feedback from their users.
It’s an in-app feedback platform, that collects NPS data based on specific usage patterns. Unlike a traditional email survey or various in-house solutions, SatisMeter is an easy to integrate, multi-platform solution, perfect for small startups with only a few customers, all the way up to enterprise scale clients.

Satismeter’s current customers include BuzzSumo,  Udacity, Mention, Adroll, Dashlane,and MailJet. I sat down with the founders, brothers Jakub and Ondrej Sedlacek, to talk about Satismeter, and their unique team.

 

The Satismeter Brothers

The Satismeter Brothers, Jakub (left) and Ondrej (right)

You two are not only Co-Founders at SatisMeter, but brothers. Have you always worked well together, or was that a later development? Is it an advantage to work with a sibling as a co-founder?

Ondrej: Before SatisMeter neither of us thought our professional paths would ever meet.
Even though we are brothers, we are quite different.
Jakub is a technical person and a product guy with experience of leading GoodData front-end engineering for five years. I, on the other hand, am a sociable person with a background in IT sales, marketing and NGO fundraising.
Jakub: Being brothers has a great advantage, in that we know each other well and we can rely on each other in good and bad times. We share the same values and because we have different expertise we complement each other well.

Tell us a bit about how you came up with SatisMeter.

Jakub: I worked in the [Czech founded and Prague and San Francisco based] analytics company GoodData before and we struggled with the direction of our product and keeping focus on what our customers need. We started collecting customer feedback and it helped us tremendously with further product development. I was surprised there was no such service that would help automate the whole process. That’s where the idea for SatisMeter came from.

How can SatisMeter be used to improve how SaaS companies develop new features or improve retention of existing customers?

Jakub:  SaaS companies live off of customer subscriptions. They need to keep their customers as long as they possibly can. SatisMeter can be viewed as a churn reduction tool. We identify unsatisfied customers, and let SaaS companies work with these customers before they leave for the competition.

Ondrej: Also, most online businesses do not get enough user feedback. They optimize the whole user experience and new features based on analysing the behavior of users, but know very little about the actual needs behind this behaviour.
SatisMeter gathers this feedback directly inside web apps and shares it back to the right people in the organisation. Unlike most in-house solutions, SatisMeter can send the feedback not only to Support, but also to CRM, Analytics and Marketing tools, as well as other communication channels like Slack. This way the feedback doesn’t stay trapped in some helpdesk database, and the whole organization can see what their customers think.

You signed some very prominent clients pretty quickly, like Buzzsumo, MailJet, Mention, and AdRoll. What do you think got you this early traction?

Jakub:  We made the service very easy to start with and let the users see the value immediately. Also, unlike many surveys on the market, we really care about the experience of the end-user – Satismeter doesn’t block them from working and let them fill in our pop-up when they have time for it. This is why Satismeter has a 30% response rates on average.
Ondrej: Our first users came from partnership with customer data hub Segment.com. For example Mention’s Head of Growth found us on the Segment marketplace, and build their churn reduction process around our NPS platform. Later he even wrote a blogpost about this process, and the word of mouth started spreading. Satismeter have also been featured on ProductHunt, which helped as well.

Do you want to help Satismeter on their journey to the top? Click Below to Tweet about them now.

Have you seen any unexpected uses of SatisMeter since you launched? Something that surprised you?

Jakub: When we launched, we saw SatisMeter as a tool for Product Managers to help them build a product their customers need. It surprised us that most people interested in SatisMeter were marketers and growth hackers who wanted to optimize their growth metrics. We unlocked many creative uses by integrating with other platforms and letting our customers work with the collected data. We already took a lot these ideas and implemented them right into SatisMeter.

What’s the short term plan for Satismeter? Where do you want to be in 6 months to a year?

Ondrej: There are four areas where Satismeter will focus: new platforms, new markets, better understanding of user feedback and actionable advice. We want to cover all platforms where users are communicating with businesses and our mobile survey will be launched in March. We are working with several communication platforms to collect user feedback for their customers. Some of our customers collect tens of thousands of responses a month and we would like to give insight not only whether their users are satisfied, but why. Also we already know how to identify the customers with higher churn risk. We want to advise on how to work with them right inside SatisMeter.

Which players do you view as your biggest potential competitors in this market, and why?

Jakub: At the moment our biggest competition are companies that are collecting NPS using email surveys. A surprisingly large number of companies are still using email surveys, although it’s much less efficient than an in-app solution. There are also many platforms that are doing really nice survey widgets, but don’t work very well with the collected data. Satismeter is trying to focus on an easy to use solution that will help companies to dramatically improve customer retention.

Can you tell us some of the most common mistakes that SaaS companies make when surveying their customers?

Jakub: Common mistake is that they just survey users and don’t follow-up with them. It’s a great way to engage with your happy customers and opportunity to proactively resolve issues of the unhappy ones.

What are some of the most common misconceptions about how NPS is used, and how it works?

Ondrej: The most common misconception people make is to look at NPS score and ask “What does this number mean to my business”. The NPS score alone is an indicator of how satisfied and loyal your customers are, but every business segment, every culture and every country has different perceptions and thus different benchmarks. The right way is to watch the NPS trend, correlate it with product and service changes, and decide how these changes influenced your customers’ satisfaction.
Jakub: NPS can be also used in many other ways to improve your business, for example as tool for better conversion of trial users into paying customers, or a way for better targeted marketing campaigns.

Has StartupYard been a positive experience so far for the team? How has it affected your overall approach to the company so far?

Jakub: StartupYard is a combination of connections, knowledge and experience. This is invaluable for first-time entrepreneurs like us. The first month was intense but Satismeter moved miles ahead in vision of our product and company. We are really excited to see what’s coming next.

Philip Staehelin

Philip Staehelin of Roland Berger: Czech Republic a Gateway for Startups

Philip Staehelin is a StartupYard mentor and investor, and former StartupYard Executive in Residence for 2015. He currently serves as Managing Partner for Roland Berger Consultancy in Prague, with a particular interest in connecting startups with corporate partners. Philip is also a key investor in Gjirafa, a StartupYard company, which recently raised $2 Million from Rockaway Capital.
The following is a lightly edited translation of an interview with Philip that appeared in January in Lidové Noviny. The author is Jan Zizka. Some of the content has been slightly altered for clarity, and several questions have been shortened or removed. 


Lidské Noviny: Few have as much experience with Czech startups as globetrotter Philip Staehelin, who has been living in Prague for over two decades. Staehelin merges two different worlds – he has not only been (and still is), very active within the ecosystem of promising startups, but he also has broad experience from various managerial positions in a number of large enterprises. As the new head of the Prague branch of the Roland Berger consultancy, he confirms in this interview that he has clear plans to recommend, even to traditional corporations, learning from the flexibility and the creative mentality of startups.

Silicon Valley, maybe Switzerland, or Israel, is what comes to everyone’s mind when talking about startups. But I’m not sure what the current situation is in Central Europe. Poland, perhaps? Do you think we have already made at least a small step forward for people to associate Prague and/or Brno with startups?

PS: Well, it’s absolutely clear when you include Berlin in the CEE area. There is a real, huge boom of startups, and many investments are now oriented towards Berlins direction. In my opinion, there is enough interesting potential within the Czech Republic as well, but I am not convinced that Prague can become the next startup hub like Silicon Valley, London or Berlin. However, Prague may serve as a kind of funnel and launch pad for startups from the entire CEE region.

Philip Staehelin

Philip Staehelin of Roland Berger

Alongside other roles, I’m a mentor and advisor in StartupYard, a startup accelerator which is helping to shape Prague into such a role. For instance, TeskaLabs, a company dealing in mobile communications and IoT (Internet of Things) security, went through our accelerator. Then they were accepted to a leading London accelerator (TechStars).

So people who focus on this business in Prague will be following all startups in the CEE region? Or will early stage investors still be found locally, and other investors from London or Silicon Valley will join them later?

This is one of the possibilities. The key idea is to achieve wider coverage ,which will help Prague become a startup gateway – a bridge from East to West. As for StartupYard, for example, it’s closely linked to Slovakia and Hungary.

The key question is what it will look like here for the investors. In the past, only very limited funds were available. Nonetheless, the appetite for risk, which is obviously closely associated with investments in startups, has recently increased. The competition exists even on the investors’ side. There is also governmental support, albeit still insufficient. However, it’s not the same money as in Silicon Valley yet. Investors here are not giving out finance into concepts or ideas; they rather go after companies that already generate some revenues.

Yes, previous governments experienced that weakness when they started to build up the so-called “Seed Fund” for projects at an early stage. Will it still be very difficult to find other investors for those projects in the research phase?

This surely is a weak point. Yet, I’m not suggesting the government offer money itself to anyone who applies with some “startup.” It would not lead to any better outcome. The state should provide resources to the existing venture capital funds. Or to accelerators, for example.

In StartupYard, we have utilized European funding for the past two years, which helped a lot. But our government can take a number of other useful steps. They can provide support in creating the right eco-system for startups. Although financial aid is very important, it is still just a side-effect in comparison with shaping simple and transparent entrepreneurial environments.

Speaking of the new state-owned National Innovation Fund, are you a sceptic?

Yeah, I am definitely skeptical, but at the same time I have some hope. We need something like this. However, I know how much of the state-provided money has disappeared in past years, without that being reflected in the improved performance of companies.

So I have strong hopes that is isn’t just another opportunity for corruption, and that this money would indeed assist in changing the whole business atmosphere.

The problem is to ensure such a fund is well-managed. Because if you take a look back at the history, you’ll see that similar projects here haven’t been managed well.

The Ministry of Industry and Trade wants the new fund to invest along with private investors. Is that vital to success?

Fortunately, our government representatives do realize that they aren’t much good at choosing startups with potential. The state is not a professional investor, and wants to be assured that someone else will be involved, and put their own capital into selected projects. The question is whether it can be guaranteed that this money isn’t being allocated to family, relatives and/or friends of those who would be responsible for managing such a fund.

You said that the state has other, more important roles to play.

They should definitely care more about the actual conditions under which new companies are incorporated in the Czech Republic. In comparison with other countries, we are really backwards when it comes to the difficulty involved. Surprisingly though, the situation is even worse in Germany. Still, most other countries in Europe have much more favorable systems. Poland, for example. And Estonia is the bellwether for innovation.

I often hear that we are fighting corruption, while the issues of the  entrepreneurial environment itself are cast aside. Do you agree with that?

Well, fighting corruption is extremely important. If you grant hundreds of millions to startups, it can seem like a lot. But it’s still just a fraction of what has been stolen in this country. I was an active member of  the Administration Board for Transparency International for several years, so the topic is close to my heart. Czech firms simply wont be able to reach their potential without ending all the graft. If the government could prevent the misuse of public money, and was able to use it properly with promising new companies, that would have tremendous effects.

Just to name a successful example – consider anti-virus experts such as AVG or Avast. They help our economic growth and they employ many people. And on top of that, they are promoting the whole country abroad. We can dare say we are leaders in internet safety because of them.

Some in Czech business circles would tell you that even today, banks will remain central to financing here. The Prague Stock Exchange has no particular reputation, but banks can’t be replaced, and VCs can’t save us. Moreover, banks have more liquidity, and tend to claim they can’t find good business plans or interesting projects.

Banks are too careful when it comes to risk, as part of their basic makeup. And definitely they are not the best choice for startups. As I already mentioned, even some venture capital funds here are risk averse. Which is obviously quite a difficult situation for startups – usually with no assets and frequently being “one-garage” style firms. They have computers and thats it. So very often, they have no other options but to ask their friends and/or family for seed money. Then, so-called angels might get involved – individual private investors. However, from all these relatively small investments you can end up with a nice sum to start with.

And local price levels help too. A few years ago, I personally invested in Video Recruit, a startup that was able to survive here with just EUR 300k for three years. In London, by contrast, you couldn’t live longer than six months on that.

Who are these angels? As far as I know, businessmen like Zbyněk Frolík of Linet or Eduard Kučera from Avast are investing in startups more and more. Do others invest as well, after selling their own businesses, or delegating management to others?

Yes, there is much more funding coming from people who are themselves successful as entrepreneurs. Still, they need better access to startups. That is where the aforementioned accelerator model might be useful, as many great entrepreneurs are involved there as mentors.

To become an investor, you don’t need millions. An investor can be managers who have just done well enough. Another example: a company that went through the StartupYard accelerator a few years ago was an “Albanian Seznam,” called Gjirafa. Our mentors were among their first investors.

As the new Roland Berger Managing Partner, you plan to focus on cooperation between large corporates and interesting startups. Why are you so driven to connect these two seemingly diverse cultures?

You’re right. I am very excited about this, and for multiple reasons. I used to work for T-Mobile, as a member of its international team for innovations. We came up with a few nice ideas, but the company then lacked the ability to work with and develop them. That was about eight years ago; and large companies, including T-Mobile, have changed a lot since then. Today, there ‘s much more understanding that driving innovation is important, and that there are lessons to learn from the flexible approach of startups. The question now, is how.

They can try to incorporate startups into their own structure, but oftentimes startups don’t want that. They don’t want to become just a smaller part of a big unit with overwhelming administration, with no room for development and growth.

What’s your solution?

Startups can stay outside large enterprises, keeping their uniqueness and creativity, but still working cooperatively. Corporations can then create, in collaboration with these startups, some kind of innovation lab where ideas can be worked on. This mode of cooperation is highly fruitful for startups, especially if they get at least some financial support from a bigger company. This is not to mention the advantage of an enterprise’s customer network.

Yet, there is another model available – creating corporate venture capital companies, and buying shares in prospective firms that are relevant to  their overall strategy. As a big plus, you don’t have to put all your eggs in one basket.

It occurs to me that you personally represent a good example of combining these two worlds – you probably aren’t a very typical head for such a traditional consultancy as Roland Berger.

True. I have been a consultant before and wasn’t sure whether to return to the role or not. Though, I had a long discussion on innovation with a global head of Roland Berger, who aims to lead this company more deeply into  the digital world and to a new mix of consulting, technology and private equity. This is a very nice, thrilling vision and also completely in line with my own convictions.

To what extent will this be attractive for Czech companies without foreign ownership? Merging trans-national corporations and startups might seem to far afield for them.

There are many types of innovation. Some Czech companies have agreed to try innovating inside their establishments according to the Industry 4.0 concept. In other words, to integrate the latest technologies and maximize the value of what they already do. And it can work out pretty well because a lot of local firms are very specialized in one particular segment. But it might be helpful even for them to be inspired by a startup mentality. I think also that Czech companies must stay open and try many paths. If something fails, it’s rational to try something different.

Do you think the whole concept of Industry 4.0 is more than marketing jargon? Is it an exaggeration to call this the 4th industrial revolution? Computerizing, digitalization – we’ve seen all this already as a part of the third one.

I am an eye-witness to the fact that this really is the fourth revolution, and I don’t think this is a matter of mere marketing. If companies succeed in gathering data from each & every machine and interconnect all processes ,from logistics to production, that’s an appreciable progression towards higher efficiency.

The Industry 4.0 principle relies not only in applying automation and robotics on your manufacturing processes, but also in integrating all data into your planning – wherever that data comes from (both inside and outside) – and working with it efficiently.

To put it simply, a brewery will be able to connect information on how a climate phenomenon like El Nino may influence this year’s harvest yield, together with historical details on how similar weather swings affected beer consumption in the past, and adjust their strategy for the future accordingly. Or you can easily detect in advance when one of the production line components might break down, or wear ou,t and avoid that by performing pre-emptive maintenance.

The Industry 4.0 concept came here from Germany. My question is a bit wider though – do you think it’s good that the Czechs are so strongly linked to the German economy?

Actually, this is more of a political question… Look, we are such a small country, there are just ten million of us.

Did you really say „we/us“?

Yes, of course. I’ve been living here for more than twenty-two years, I obtained Czech citizenship last year. My wife is Czech as well as both my kids. And I also became a big fan of the Czech national hockey team…

So you are eligible to vote as well.

I will definitely vote, but it will be a tough decision to make. Anyway, I do think we have no better option than our relationship with Germany. I am a bit worried about that element in Czech society that is pulling us back towards the Russian sphere of influence again. So I am willing and happy to be a German ally, vven if neither is perfect nor ideal. But we can benefit immensely from the German industrial base being as strong as it is.

On the other hand, that doesn’t necessarily mean Czechs shouldn’t strive to enter other markets. I gladly support market expansion. And well, if our local startups can be a part of the global scene, it will be a massive thing for the Czech economy.

Introducing StartupYard Portfolio Manager Jaromir Beranek

We’re pleased to introduce Jaromir “Mirek” Beranek, the latest member of the StartupYard team.

Mirek joins us as a full time team member and Portfolio Manager. It will be his responsibility not only to keep track of and stay in contact with the startups we have accelerated in the past, but also to advise and consult with startups during and after our program on matters of finance, financial reporting, and investment planning. Mirek will also manage StartupYard’s own budgeting and contracts with incoming startups.

Jaromir studied International Management (CEMS) at the University of Economics and Law at Charles University in Prague, taking exchange semesters in Management at the University of Cologne and Law at NOVA Southeastern University in Ford Lauderdale. In 2011, he joined Telefónica’s Aspire Graduate Program and spend the following three years on different assignments in finance, strategy and marketing in Prague and Munich. Mirek is also a veteran of Wayra CEE, the Prague-based branch of a global accelerator network, where he took care of financial matters and portfolio valuation.

I caught up with him this week to talk about his new position with our team:

Hi Mirek, welcome to StartupYard! What makes you want to work with startups?

Let’s put the question differently: What makes you not to want to work with corporations? Then it would be much easier for me to answer: the corporations I have worked for are incredibly slow, most negotiations are very political, middle management often lacks both education and capabilities, no one outside the board has the authority to decide anything and many colleagues felt demotivated and transmitted their foul mood to others, including me.

I simply had to find a different place for self-realization where I could use what I had learned and make some impact. Luckily, the opportunity came at the right time and it was quite easy for me to get used to this Brave New World. First it was Wayra and now it is StartupYard. Of course, even startups can be slow, incapable and helpless at times. But in general, I feel that on this side of the fence I can see results quickly while having fun and doing the work my own way.

Can you tell us a bit about your background in the corporate world?

Being an alumnus of an international management program, I was almost pre-destined to be successfully lured by a corporation once done with the university. And I really liked it at first.

Having gained some internship experience from the time of my studies, I suddenly felt like I became a true member of the big world consisting of huge buildings with shiny glass façades. I wanted to work on interesting projects and be seen. But instead I found myself sitting behind a computer screen all the time and there was no one who would care.

Thus I started learning and learned quite a lot from finance, marketing and strategy. But the frustration began to snowball gradually. Once back from my foreign placement in Munich, I somehow resigned myself to it, and kept on going to work just to make money and make sure I have enough free time to do what I like most. All in all, it hasn’t been a very shiny experience, and now I know for sure that if I was to return to a corporation, I would have to design my own role first and have at least some executive power.

What made you want to become a member of the StartupYard team? What do you hope to accomplish here that will have a lasting impact?

Well, because you are all very nice guys in the first place, that’s an easy one! But seriously, people always make a huge impression and here I felt we would fit well together. Next, I wanted to follow up with my previous work for Wayra and give an afterlife to all those beautiful charts and models I have built. 🙂

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Talking about my footprints, I want to make our financial reports at StartupYard more user friendly, both for us and the investors and then, hopefully, help create a solid and trusted alumni pool where investors could come and pick from them– sort of plug and play. Nice and neat.

And one more thing, I want to help build a strong community around StartupYard so we are heard and seen and more talented entrepreneurs join our acceleration program.

What do you think are important qualities for someone working in accounting, and financial control?

Clearly, to be a good financial controller you have to develop some kind of affection for numbers and tables. It’s definitely useful if you have strong computing skills and can visualize graphs and models you want to build. Analytical thinking is definitely an asset if you want to work with the results further and reflect them in your business.

When it comes to data collecting and work with excel, you have to be patient and thorough but at the same time be determined and know how to make the others give you all the information you need. If you work often with invoices and paperwork, it’s also quite important to be well organized and remember all due dates and deadlines.

You’ve been brought on as Portfolio Manager for StartupYard. How can StartupYard improve our support of alumni?

From my experience, whenever you leave an organization you have been a member of for some time, you tend to lose interest in a few years. Therefore, we need to communicate with our alumni more frequently, tell them about all important events but most importantly invite them for at least two community events every year and make sure they really come and talk to us.

However, this is only possible if you can offer something valuable. In our case, the key should be our contacts to investors and continued mentoring and business consulting. On the other hand, we shouldn’t promise what is impossible – there should be realistic expectations set from the beginning and a mutual relationship of trust. Eventually, I would like to make the StartupYard be seen as a “safe harbor”, a place where all alumni may come to for a piece of advice, sympathy and also a friendly kick if needed.


How do you envision your role with the incoming startups in 2016?

I could be talking about my big dreams and great ideas but the truth is that my role at StartupYard was defined quite clearly. Therefore I know that I will be responsible for a successful and timely negotiations and contracting in the first place.

In order to avoid the nightmare scenario of not having signed one or more contracts by the end of the acceleration period, I have to meet our new startup co-founders very early and build relationships with them. Then, hopefully, they will be also open to share their financials with me, which I need to work with not just to establish business value of the portfolio but also to help them set realistic goals and secure financing under fair terms.

To sum up, I would like to be a partner to them and make sure they make the most of their business.

On this topic, in your experience, what are some of the most common and problematic mistakes that startups make when it comes to their accounting and financial practices early on?


The biggest mistakes some of the startups make is that they completely give up on planning their revenues or only do a few “pro forma” tables.

I agree that it might be difficult to predict your business development if you have just started but it tells a lot about your level of competency and trustworthiness to potential investors. Also it helps to give the starting business some direction.

Another common mistake is that startups tend to rely heavily on first investment prospects based on initial meetings with potential investors or even only on declared interest. It’s important to realize that negotiations may last several months and if you aim too high, you may easily run out of cash and make a fool out of yourself. That was just to name a few common mistakes, but I could continue for hours and I don’t want to be evil! :laughs:


What are some of your hobbies and interests outside of finance and startups?

Most of all I love hiking in the mountains and outdoor sports. Usually, you would find me running, roller-skating, biking or skiing in the winter. Less than I used to but I still play drama with my friends in a student artistic group OLDstars. I also used to play music quite a lot before: clarinet, saxophone, guitar and a bit of singing. Over time, I started to prefer going to theaters and concerts as a visitor, having realized that I will never be as good myself.

Two years ago, I meet a group of very interesting and active people in Vacation School Lipnice, who organize one or two week experiential courses and workshops for groups of people across generations. There you learn by playing games, discover new things about yourself, fight your fears and make new friends. I would like myself to organize a course like that to promote political and journalistic engagement among high school and university students.

Last but not least, it’s also worth mentioning that my friends and I write a blog about Prague confectioneries www.cukrousi.cz.

SentiSquare: Big Data Means Big Mistakes for Brands

Last week, I sat down with Founder and CEO of StartupYard 2014’s SentiSquare, Josef Steinberger, to talk about how the company took 3rd place among 72 challengers at the UPC: Ignite innovation competition, and what SentiSquare has been working on since leaving the accelerator last year.

sentisquare-logo Hi Josef, how have things been going with SentiSquare since you left StartupYard in 2014?

Wow, has it been 18 months already? We have been quite busy, and we’ve signed a few really high-profile clients, including Nestle and T-Mobile in the Czech Republic.

Our most exciting recent news is that we took 3rd place in the UPC competition: Project Ignite, which is for the best tech entrepreneurs in the country. We took 100,000 CZK (about 4,000 Euro), which we plan to use on further development of the SentiSquare service.

How did you get involved with the UPC contest?

Stanislav Rejthar, our financial director, is quite well connected to business in Prague, and he found out about the competition, so we decided to enter. There were 72 projects in the 1st round, with 30 semi-finalists, and 11 finalists. Five finalists passed to finals from the Facebook voting and 6 were selected by jury. And we took third place overall.

The first place winner, this is a bit funny, but they are actually working on turning pig-dung into water and other nutrients. So we got beat by pig shit :laughs:. But we were really happy with the results, and the upside is that UPC has expressed a lot of interest in working with us going forward.

Can you talk a bit about how you can help companies like Nestle, T-Mobile, or UPC, without talking about the specifics of those clients?

Sure. What we do, as you know, is a sentiment analysis across the whole web. This means that we are able to tell our clients in good detail, what their customers are talking about, and how they feel about those topics and specific things they discuss. We get this info from social media, forums, websites, and comment sections that number in the 100s of thousands and more.

So, for example, we are able to tell a large name brand that is about to launch a marketing campaign based on a specific topic, what people are already saying about that topic, and the feelings of consumers related to that topic. And we can give this analysis in much more detail than simply: “good or bad.”

In fact, one of the reasons we start working with the brands even before the campaign starts, is that we can help them to shape the nature of the campaign to get a better response. We can tell them what their consumers are likely to respond to, and it works.

Can you give me an example of how that works?

Yes. For one client, we worked with them on launching their company blog. This was a pretty large brand. They wanted to launch their blog in the new year, attracting people who were interested in new year’s resolutions and this kind of thing.

So, the company had a list of topics that they thought people would be searching for on Google, which they could take advantage of by writing about those topics, in relation to their own products. What we found, though, was that there were a number of topics being discussed quite a lot related to new year’s resolutions, but involving topics that were not included in the campaign’s key word targets. It happened, however, that these topics were very relevant to the company, and that PPC prices for these search terms were a very good value for the price.

So we were able to identify, among the company’s core demographic, a topic that was not being served, and allowed them to have a very good search position for those terms.

We did more than just help the company understand what people liked and didn’t like, but also things that the company had no idea they were talking about at all. That was a big advantage for them and they saw the results in their search traffic and ROI for that campaign.

Senti-CTA

Click to learn more about SentiSquare

Are big brands surprised by what you tell them?

All the time! Marketers and managers like to have very clear and precise information, that they can sort of divide into yes/no decision processes. So, for example, they want a clear yes/no answer to the question: “is my campaign working?” But what we are always showing them is that these questions are more complicated than they want to make them. And in that complexity lies a lot of opportunities that are not being taking advantage of.

For example, a big brand might say that a campaign is a “success,” if people are talking more about their brand after the campaign than before. That is easier to measure also. But campaign managers can’t tell whether people are talking about the actual messaging of the campaign. They have to assume that more people talking about the brand or product means the messaging is working, but it might not be. Even if they use simple positive/negative sentiment analysis, they can’t tell why people feel positively or negatively. They can’t tell if the message is working as intended.

We can help brands determine if people are talking about the messaging that the brand is using, and this can give a much better sense of whether the campaign is a success. We can also do pre-analysis to understand whether the intended audience will be receptive to that message, and if not, to what messages they might be more receptive.

How do big brands currently determine what their campaign messages should be?

It’s mostly about intuition. Some big companies literally have someone going through thousands of customer posts on social media and forums, and trying to glean some kind of insight about what customers are interested in. So it is possible to get a subjective, intuitive sense of what is important to your customers. But it is very difficult to get an objective, provable figure to support that intuition.

On the other side, it is relatively easy to analyze the sentiment of your brand’s audience in positive/negative terms, but that doesn’t help you at all to understand what your messaging should be. Even positive/negative terms are super-subjective. They are down to culture, to context, to the type of person talking, and the person they are talking to. A human can recognize sentiment when we see it, but it is much more complicated to see sentiment in the aggregate. It is very easy to think you understand it, when you really don’t.

We are providing a kind of intuition engine. It has the reach of a large scale data tool, but it can provide the subtlety in insights of a human.

So you help companies to avoid false positives in sentiment analysis?

False positives or also completely wrong assumptions about data.

There is a really funny example we experienced recently. We were doing analysis of the wine industry. The customer had already had another company scrape a large amount of data including basic search terms, such as the word “wine” and its variants in Czech. They wanted to see what kinds of wine people were talking about in a one month period. So far so good.

Now, you can do a broad sentiment analysis based on positive or negative keywords, and give some impression of whether people have good or bad associations with certain types of wine, right? Well, not in this case. Our analysis was able to show that a huge amount of this data (about 80% actually) was totally useless. Why? Because it wasn’t about wine! It was about cars.

Cars?

Yeah, cars. The data scraping had caught a lot of information about VIN numbers (vehicle identification numbers). It had also scraped a lot of information about Vin Diesel, the actor. Wine, in Czech, is written as vino, or vin, or some variation. So without our analysis of what the subjects actually being discussed really were, the client might have made a lot of really wrong assumptions about what people feel about different wines. You think a lot of people like red wine, but they really like red cars! Or maybe they say they love wine, but they are really fans of Vin Diesel movies.

The data would be worse than useless. It would cause you to make all kinds of wrong assumptions about your audience.

But we were able to pre-process that data, and make the final data set much more valuable for analysis.

You said earlier that you can give more than a black and white look at customer sentiments? How do you do that?

There are a few ways.

One of the problems with sentiment analysis for large amounts of written text, is that there are a lot of positive and negative keywords mixed together. It doesn’t make sense just to count them up, because the actual construction of thoughts is not so binary.

So what we can do is to provide a sense of the intensity of sentiments overall. Is a customer generally happy, or generally unhappy? A customer can use a lot of negative words, but still be mostly satisfied with a product. Some people just enjoy complaining, and a brand shouldn’t count that person as an unsatisfied customer. So we can provide this shading of sentiment by intensity.

There is also aspect based sentiment analysis. This is the analysis of not just a brand as a whole, but as related to specific aspects of the brand and its products. Maybe people love a brand, but they have negative sentiments about its prices. Or the opposite can happen. Maybe they love the functionalities, but hate the color. By combining these insights, we can present a much more realistic picture of a customer than simply: like/dislike.

How are you different from other monitoring services like BrandEmbassy (also a StartupYard Alum)?

BrandEmbassy provides monitoring of keywords, which allows service representatives to see live conversations on social media and elsewhere. The big advantage for them is that they can route those conversations to the appropriate person on their team and engage directly with the customers.

What we do is the eagle eye view of all those conversations- we can tell companies what the totality of all those conversations really means. So it has a bigger effect on a company’s overall communication and branding strategies, whereas a company like BrandEmbassy helps a company to improve its small-scale interactions with individuals.

What are your plans for the near future?

A big request is for our system to be available in real time. This is something that we really want to develop more in the near term. Having the ability to see the conversation changing online at every moment, and being able to understand how people feel about things from day to day, is an important thing for big brands.

As conversations online get only more numerous and also more specific, the job of keeping up with that volume is getting unmanagable for the biggest brands. SentiSquare can provide a pulse of conversation that really provides valuable insights, even in the day to day. Brands can use SentiSquare to get an evolving list of important keywords that are related to their brands.

That list changes every day, but currently it takes a long time for that information to filter into a brand’s messaging. Given the prioritization on the topic or opinion level, brands can quickly get a gist about the actual situation The speed is important, because all the brand managers are busy people. We can make them more responsive to the conversation of today.

We want to change the way people look at sentiment analysis. Things are not black and white, positive and negative. Somebody says something is “big.” What does that mean? It’s not good or bad in all cases. Nothing in discourse is cut and dried, and all sentiments have levels of intensity.

Our clients usually want black and white answers. We have to educate our customers about the danger of viewing their brands in this way. The magic answers that big data is supposed to provide can easily be very wrong. And we can help companies identify opportunities they are ignoring, because they have been addicted to this positive/negative polarity.

StartupYard’s Viktor Fischer on Quitting Your Job, and Overcoming Fear

Hi Viktor. You’ve had a really interesting career, co-founding Innovatrics a decade ago, and most recently becoming a junior partner with McKinsey and Company. Can you tell us your personal story as an entrepreneur?

Hi Lloyd – sure, thanks for having me.

When we founded Innovatrics in 2004, I had no clue how to build a business. We created a software development kit around a fingerprint algorithm, put it online and waited to see who would buy it. When after 2 weeks no-one replied, we started to think about who might be the customer, what were their needs, what was the right product, what was the right pricing, and how we would sell it.

Early on we copied competition (copying is good), and negotiated licensing deals with major biometrics players such as Bioscrypt and CrossMatch – to survive. Over the next several years we found our niche: high-speed AFIS (Automated Fingerprint Identification Systems), defined the target customer segment. We fine-tuned the pricing and focused on the most efficient marketing & sales channels. Last year Innovatrics won Deloitte Top 50 in 2014 for its 344% revenue growth and last week was designated IT firm of the year in Slovakia. I am congratulating the team for those fantastic achievements.

After 5 years at Innovatrics, I decided to pursue an international MBA to grow my network and then entered McKinsey. Surprisingly, although McKinsey works for corporates, it follows a very entrepreneurial way of working. Projects (called “engagements”) are delivered by small teams (2 to 3 people full-time supported by experts and senior leaders), who work by quick iterations with the end product in mind (similar to “scrum methodology”). There is flat hierarchy and even junior members are encouraged to disagree with the most senior partners.

Aside from consulting, you are also an active angel investor. How do you pick your investments?

I only have 3 criteria: First, would I be a user of that product, and would I be excited to use it? This is my way of validating the value proposition.

Second, I need to know the management team, and have them be introduced by a person I trust.

Third, I need to have the knowledge I can use to help the startup. In broader terms, anything commercial, and in narrower terms, anything related to defining value proposition, validating product/market fit, modeling financial plan, raising funds, orchestrating B2B sales, or expanding internationally.

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Fischer chats with fellow StartupYard mentor Ondrej Bartos at a StartupYard event

Have you ever broken one of those rules? If so, what was the result?

Yes, sometimes an edge in 1 or 2 criteria can balance-out the 3rd criteria. For example, recently I invested in MPower Financing via Angel.co. MPower provides loans to US university students coming from ethnic minorities.

Although I would not be a user of such a product, I like the mission of the company: I believe funding should not be a barrier to education. And I know the founders really really well (both CEO and CTO are my MBA classmates).

You recently left McKinsey to open your own club/bar, and focus on startups. What motivated the move? What will your club be like?

:Laughs: how much time do you have? I can talk for hours about this.

I think we do our best job when we do something we love (call it passion). There is one way that really worked for me to find that out: Think that tomorrow is the last day of your life. Really. Then imagine:  If that was the case, what would you truly like to do today?

My answers were: A) go for a drink to a nice place with friends, and B) help startups grow. So I left the corporate job and bought an old but legendary nightclub called Meloun. The idea is to create an ultra-lounge like we all miss here in Prague. An exclusive place with great drinks and great music for a fantastic night out. It will be kind of a secret place so I cannot say more about it at this stage – sorry!

To help the startups, I am becoming more engaged with the teams, helping where necessary depending on the stage of the company, and more engaged with the local entrepreneurship community (including Startupyard).

Can you tell us the story of your favorite investment, and, if you have one, your biggest investment mistake or failure?

I don’t have a favorite investment – all my startups, those I invest in or simply advise are like children – no one is preferred.

Failure? Probably those I decided to pass on (yes, I’m thinking Gjirafa), or those where I miss the team’s engagement. There is nothing more demotivating than a non-motivated team. There are two mindsets with which a company is created: either to be a lifestyle business, or to build a company changing the world. There is nothing wrong with either of those. But it needs to be clear from the beginning to the team, the investors and the advisors.

You are an active StartupYard mentor, and you hosted a workshop with us this year. What motivates you to work with startups in your free time?

My sole motivator is to help startups avoiding mistakes I made. Whether it is in their value proposition, defining a target customer, pricing structure, international expansion, or even personal work-life-balance and facilitating discussions between shareholders. I have scars on my back in all these areas. I want to help people avoid getting a divorce, arguing with business partners or putting thousands of work hours into a feature that is not needed.

Do you believe that successful Czech entrepreneurs like yourself are giving enough back to the startup ecosystem in terms of attention, mentoring, and investment?

First of all, I am Slovak. Just kidding, I miss Czechoslovakia and I believe the countries together could again reach the 10th place in industrial production they had in 1938 – although in different industries :laughs:.

It will not happen however without the government’s support. When founding Innovatrics, we received around 150 thousand Euro from the French government to get us up and running. Although there is a risk to receiving government funds (often startups use that funding to delay product introduction to the market), there is an improvement in Government funding: the Czech government spends ~2% on GPD on R&D and Slovak government spends ~1% on R&D versus the US ~3%.

I know I am not answering your question, but I don’t know yet whether local entrepreneurs are helping enough. I know some of them invest through [prominent venture firms] Credo and Rockaway, or directly, and they mentor via Startupyard. But I don’t have a benchmark. It would be great to compare for example the amount of Czech angel and VC funding to overall angel and VC investments in the UK, and US, but I don’t think there’s a clear benchmark.

What is a piece of advice you find yourself giving over and over again to startups? What is the hardest piece of advice for startups to really listen to?

Overcome fear. Often I see startup entrepreneurs doing what is easy: sitting behind a computer developing the next feature set.

Call a prospective buyer or an expert to get early feedback. Find an expert via LinkedIn. Send the deck or a link to the demo and set-up a call. There are plenty of people out there who would help you. Doing it you have nothing to lose. Not doing it, you lose the opportunity to score your first customer or a future team member.

Sometimes it feels  the hardest part for startups is to listen. Whether the founders are really able to listen, hear, reflect and incorporate the advice is what I am looking for during interviews.

Your career has been split between The Czech Republic, Slovakia, France, and recently Switzerland. How do you view the development of startup culture and investments in these different regions in recent years?

I cannot compare yet. But what I really like about the investment culture in other countries is the humility with which the investors and advisors help the entrepreneur. An entrepreneur is the shit, and our only mission is to help her succeed while increasing her self-confidence. Not the other way around (ie beat her idea and her self-confidence to death).

Are there things that bigger economies like France could learn from the startup and investing cultures in Slovakia or the Czech Republic?

I like how some of the local VCs really help the entrepreneurs think about the business during the investment process. They help to define and validate the value proposition, set up pricing, create financial model, key KPIs and develop a first 100-day plan. This process is beneficial to both parties and if I were the entrepreneur, I would embrace it fully.

Andrej Kiska recently told me in an interview that Czech (or Central European) investors are not as conservative as their reputations suggest. Do you agree with him?

I agree that the mindset is changing. That’s good. From my experience however, even as recently as the Webexpo couple of weeks ago, I noticed some investors using traction as their investment criteria (quote “For us to invest, you need to have customers. At least one.”) I think people should be the first criteria of choice and overseas that is understood.

What about StartupYard makes you keep coming back? How do you hope to have an impact on us as and our program?

This comes to my 2nd passion: helping startups grow. StartupYard is the largest local accelerator. Still however, some people do not know it. David Semerad from STRV mentioned during his talk at Webexpo that “YCombinator is like StartupYard but million times bigger”. I would like to help StartupYard bridge that gap, by making connections to  the international market stronger and by voraciously helping startups export. If we’re Czech only, we will not be successful and our startups will not be successful.

Amit Paunikar: On Product Management, and Owning Failure

I caught up with popular StartupYard mentor Amit Paunikar this week, to talk about the subject of his appearance at WebExpo, where he will talk about one of his passions, Product Management.

Paunikar has been a pioneer and evangelist in the area of product management, working with Google, Yahoo, and MarketShare. He has been a software engineer, a startup founder, and a StartupYard mentor, and is currently a product manager for Skype in Prague. He will speak at WebExpo, in Prague on the weekend of September 19th.

Q: Hi Amit, you’ve had a storied career, working for Google, Yahoo!, MarketShare, and co-founding your own company, MediaStudio. Can you tell us about your career journey?

Paunikar is a native of Mumbai, lived in the US for many years, and relocated to Prague 3 years ago.

An American educated in Mumbai and Los Angeles, Paunikar founded MediaStudio, and has worked for Google, Yahoo! and now Skype. He has lived in Prague for 3 years.

I grew up in Mumbai, where I did my undergraduate education in Computer Science. After a short stint in Citicorp, I moved to Los Angeles for my Masters in computer science. I spent 15 years in California after that, working at big and small companies including stints at Google and Yahoo! before taking the entrepreneurial path and starting my own company.

Early in my career, I switched from Software engineering to Product Management, which defined and shaped my career journey immensely.

Tell us more about your transition from engineering to product management. Why did you do it?

My first job as a product manager was with a company that made a hardware/software product, a networking gateway, that allowed users to access public wifi and wired networks.I was a curious engineer, but a lot of my questions were of the following type: “why are we doing this and not that?”, “why are we approaching this market and not that?”, “who is our target customers, what are their core needs?”  

Since I didn’t know a good way to get these answers, I would be quite vocal during company-wide meetings. After one such meeting,  the CEO of the company called me in, and said: “you have a lot of questions about things that go beyond engineering. Why do you need this information and whose job should it be give you that information?”

I told him that having this information would help engineering design the correct solution, get their “why’s” answered and instill a sense of ownership and accomplishment. I didn’t have a good answer of whose primary job it should be fill this gap, but when he offered me to step in and fill the role. So I filled that hole that existed for me as an engineer- someone who could from the connection between customers, sales, BD and engineering. Soon that role morphed into product management as we know it.

What originally drew you to the Czech Republic, and what makes you stay here?

It a combination of serendipity and need. At Mediastudio, we built a web-based video post-production platform with complex tools that dealt with image processing, waveform analysis and rotoscoping. We found most of these highly skilled engineers in Ukraine and Bulgaria. It made sense for me to move close to my engineering team. Also, my wife, who I met in California, actually grew up in Prague. So it was a 2 for 1 that I could not pass on.

Since moving to Prague, I have immersed myself into the startup ecosystem as well as have had a chance to interact with small and big companies. Prague and CEE has great engineering talent, but generally lack the product management function. This is an interesting challenge to solve and contribute to. In addition, Prague is a wonderful place to live!

As a popular mentor at StartupYard, you’ve long been an advocate for the idea of Product Management. Why is this such an important topic for Czech startups?

 

Product Management is an important discipline. While Product Management is one of the pillars of most companies, big and small, in Silicon Valley, it is sorely missing here in Czech Republic and in CEE in general.

In his seminal article, Marc Andreesson says the most important thing for a startup and companies is product/market fit. Product/market fit means being in a good market with a product that can satisfy that market. Creating a product that can satisfy a market requires companies to thoroughly know its customers. The primary job of a Product Manager is to be the customer advocate within the company.

Without a customer advocate, even the most brilliant engineers and companies end up creating products that no one wants to use, or worse, end up becoming engineering shops that provide their expertise to others. For a startup ecosystem to excel, just having amazing engineers is not enough. We need a good combination of functions that make a company successful, we need amazing designers, marketers, business dev, sales and good product manager. I feel product management is severely underrepresented in Prague and CEE in general.
What would you say makes a product manager different from a project manager, a UX/UI designer, or any other position?

Product management is an interesting discipline. It is very critical function, yet you cannot learn it in schools, nor are any Product Management degrees are offered in mainstream universities. Most of the product managers I know have learned it on the job. They come from various backgrounds. I have seen designers and project managers transition and become great product managers.

I like to think of product managers as people who take the ultimate responsibility for the failure of the product. This might seem to be a pessimistic view, but there is a lot of depth involved in thinking about it this way. As a PM you take responsibility of everything. You don’t have the liberty of just thinking about what to build, why to build, how to build, how will it look like, etc. you have to think about all the questions above and more.

As a Project manager or a UX designer, you can limit yourself to just a couple of these questions.

If the product fails because there’s no market, or because the technology doesn’t work, or because the product/market fit does not exist, or the design is bad, then that is the product manager’s fault. You’re not in charge of sales and technology, or design, but it is your job to make sure that the people who are doing these have everything they need to get their job done right.

What kind of a person is best for that sort of position?

Good PMs excel in empathy, know how to keep an eye on the larger picture and just into details as needed. As a PM you have to be able to make sure everyone knows what to do, but not necessarily know to do it.

I can’t sit with a designer and tell her how to design something. But I have to be clear to her about what we are designing, who we are designing it for and what functions it should provide.

PMs have to be comfortable with unknowns and uncertainty. They need to have the drive to make sense of seemingly unrelated things and have a good grasp of multiple faculties. PMs should be the “tip of the spear” that heads into chaos and leaves a cone of understanding and calm behind them.

How has the position of product manager evolved since your time with Google?

A lot has changed in the past few years. Startups and smaller companies have a lot more tools available now that were once reserved for the biggest companies. With cheap cloud computing platforms, the cost of building products has come down significantly. A lot more processing power is available and so is the ability to create and analyze lots of data.

All this changes how product managers act. They can now market worldwide, launch fast, collect and analyze vast amounts of data, make data driven decisions and course correct. Product Managers also have lot of tools and resources available at their disposal. A growing list of well respected VCs, product managers, authors and bloggers are writing a great deal about Product Management.

Defining roles and areas of responsibility for a growing team is one of their most challenging early tasks for a startup. What are some of the mistakes you most often see in this process, and how would you correct those mistakes?

It depends on what kind of a startup it is. An enterprise startup will have a different composition as compared to a consumer startup. The key is to have a core set of people who have varied experiences. If you are an experienced founder that you have a leg up compared to someone who has never started a company. In any case, it is important to seek counsel, have strong advisors in the area and learn from existing companies in the area.

One of the biggest mistakes I have seen is that companies close themselves in, start developing the product based on a hypothesis and keep at it. They never go out and seek validation from customers and users. No matter how small the startup, it is important to have a line of communication to your customers. Another mistake is to now have engineering and process discipline. Startups have to be designed from the ground up to be scalable. Scalability as an afterthought can be very expensive.

So every startup needs

  1. A customer advocate function – these includes responsibilities like understanding the market and customer needs, establishing a sales channel and continuous business development
  2. A technical advocate function – this includes responsibilities like engineering discipline and technical excellence

Do you think that organizational structures and awareness of new working methods have improved in the worldwide tech ecosystem since you started as a product manager?

Yes definitely. As a I said before, I started before MySpace and Friendster, before Napster and Skype and definitely before AWS (Amazon Web Services). It’s now easier than ever to start a company. If you wanted to start a company back then to do something meaningful, you had to start with thinking of physical storage location for your specialized servers. Now there are cloud service available for not only computing, storage but all kinds of functions like monitoring, email, authentication, etc.

There is freedom to try out a bunch of stuff and fail quickly. Startups are making bigger and bigger bets. Backed by technology companies like Uber and AirBnB are disrupting centuries old industries, companies like Cloudera is venturing into and disrupting space reserved for the likes of IBM and Oracle.

This is the cloud era, but 15 years ago most of this would have been unfeasible. Companies just didn’t have the elements necessary for such broad missions. And because of that, people are changing as well. Nothing seems impossible, today a 20 year old out of school can think about disrupting really well established industries and get funded to do it.

Co-working: the Future of Work? Our Interview with Prague’s Node5

StartupYard’s connection with Node5 dates back to the founding of both, in 2011. Born as an incubator/accelerator program, Node5 and StartupYard quickly split into two separate programs, with separate investors.

Node5, founded by Lukas Hudecek (an original co-founder of StartupYard) became an open co-working space, with a mix of public and private offices which companies and freelancers, as well as startups, share. The space offers a dynamic and social workplace for people who would otherwise be working in small teams without large offices, and is a cost-efficient solution for small companies who would like to offset and share some of the costs of running an office, including reception, food and drinks, meeting spaces, security, cleaning, and other services.
Last year, StartupYard returned to Node5, launching a new partnership, and making some of the accelerator’s resources available to members of the Node5 community.

Node5 is conveniently located near Andel, in Smichov, part of Prague’s “Silicon Valley” district to the west of the city center.

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You can read about Node5 on their website, or tweet to them @TheNode5

Hi Petra and Lucas! First, give me some background on yourselves. How did you come to work together?

Petra: I’ve stood on my own feet since the age of 13 and the rough struggle of everyday survival made quite an “iron lady” out of me. I learnt to go and achieve anything in any profession, and make money for the next day under any circumstances. This heartless method helped me quite a bit  when I decided to set aside my university studies and enter the tough world of PR, marketing and sales in which I founded a company, later sold it and used the money to move to Amsterdam to finally pursue further self-development.

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Petra Koncelikova managers Node5, and a team of between 5 and 8

Time spent in Holland was quite therapeutic, and an eye opener. I created a local business- a leisure programme for hard working women which kept me financially independent. But more importantly, it taught me to love and respect myself as I grew alongside my business.

I met Lukas through a friend of mine while still living in Amsterdam. Meeting a businessman who cares more about helping others than making money was in my world just as much Sci-Fi as flying a rocket to Mars to shop at a Bio market. We had a couple of discussions and after a while it turned out we complemented each other in many ways. Particularly in business matters.

We found each other pitching in where the other got stuck. His philanthropy and my rigid attitude proved to balance out perfectly and after just a couple of months, real results showed and it’s kept rolling ever since. We make money and do good at the same time.

Lukas: Being thrown into world of entrepreneurship since the early stages of life, I had my ups and downs starting a couple of companies.

 

Lukas Hudecek, founder and owner at Node5

Lukas Hudecek, founder and owner at Node5

I started a computer hardware store and B2B platform for local computer shops, a creative agency making websites in FrontPage 97, a hardware manufacturer of heavy-duty wifi routers for rural areas and finally, a retail shop for home automatization systems. I raised capital for future endeavors by employing myself in companies as a developer, one of which happened to be Skype.

After a while I thought it would be great to share my experiences with others, and so I started to support younger entrepreneurs by organizing events and hackathons. Those efforts turned into founding StartupYard, where I had the amazing chance as CEO to put our first batch of eight companies through the 3 month program. I founded Node5 soon after.

The two most significant events in the existence of Node5 were when we became break-even in February 2014, and when I decided to hire Petra and make her my General Manager. She proved yourself ever since, and as an extra bonus I’ve gotten a couple of lessons on how not shoot myself in a foot.

What problem did you originally hope to solve by opening Node5?

Lukas: When I was with StartupYard, companies were missing two things especially. A venue and community. Node5 was exactly this, just without the acceleration program. When we started, we thought using London’s TechHub franchise was the way to go, but later we decided to stay independent. It looked like a crazy decision back then, but worth it because now we have the venue, community and accelerator under one roof with complete independence.

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This is simply something neither Node5 nor StartupYard would have been able to achieve on it’s own at this scale. And that infrastructure was something I’d originally been hoping to solve for companies like we use to be in the beginning. The time is now.

Was there a model that you followed when you founded Node5? How have the space and business diverged from your original vision?

Lukas: As we were in close talks with TechHub during the early stages of Node5, we knew some of the essentials. We knew some basics about community and real estate business around this type of work. Even though the purchasing power in London and Prague differ greatly, we saw an opportunity in combining community and real estate in a nearly non-profit business to engage talent in an equity-based program, to slingshot ready made entrepreneurs out to the world.

But I was thinking about Node5 from the wrong angle at that point. Very soon we realized we are unable to pay for Node5’s operations costs with equity, so we started looking for stronger monthly revenues. In Feb 2014 after a long hard 2 years, we became break-even strictly on the real estate and space rental business side.

At that point, we had something of an appetite to crank up the old acceleration program too, but then StartupYard fortuitously returned [StartupYard was located elsewhere from 2012 to 2014] and did a fantastic job on the last batch. I would say that this helped us to properly realize Node5’s original vision for the first time.

On the business side, what has proved to be the hardest part of running a co-working space? Has anything surprised you?

Petra: Running a co-working space of this size and form proved to be slightly schizophrenic, because you are internally dealing with different types of businesses and professions in a team of 3 – 8 people max. A thousand square meters require constant maintenance. We keep that space up and tidy 24/7. There’s always something going wrong, somewhere. You have to do not just your promotion but also promote your partners. You’re a salesperson, project manager, event coordinator and HR, all at the same time having only 24 hours in a day.

You have to deal with smaller unreliable service providers since we don’t reach wholesale quotes. Its hard to describe the hustle we arein when we have to find an alternative so our clients won’t spot the difference. Fair usage policy is NEVER fair enough. You always step on someone’s toes and your good intentions usually interest no one.

Sometimes we help enthusiasts to throw their own gig to support their community, while planning events 6 months ahead in the background just to try hold still on a tight schedule. We have this policy to do our best and always walk the extra mile for our clients. But we can’t fit it all in all the time, and there’s always something we miss. It can be pretty frustrating!

Lukas: I’ve been surprised by the diversity of core tasks that are essential to running a coworking space. On a daily basis, we bounce between being a catering firm, an event production company, and real estate and business consultancy agencies. Each of these functions require a great deal of brain cycles on its own, so it’s hard to keep them profitable and running.

It’s like running four companies simultaneously, and that is really the hardest part. I wouldn’t be able to handle it without the great team Petra has put together. Running a coworking space isn’t exactly the easiest job ever, but what is?

Are there some success stories from Node5 that you’re particularly proud of?

Node5 and StartupYard cooperated last month on PragueHacks- including over 80 local programmers.

Node5 and StartupYard cooperated last month on PragueHacks- including over 80 local programmers.

Lukas: I think that I am speaking for my whole crew when I say that there are many successes our members achieved over the time we’ve been here, but I’d rather spotlight something else I am proud of. That’s the current state of our startup infrastructure and its ambitions. I am proud of all those 2-4 year old companies that still push forward like crazy! I am amazed how many failures were forgotten over the past months and years. I am sure that if there is anything like the Czech Startup community, it has never been better. I am proud of what we have achieved together over these last couple of years.

Do you see this or other alternative work spaces as a viable path for a larger part of the workforce in the future? If so, what are its main advantages and disadvantages?

Petra:  Well as a former freelancer I’ve tried it all. I worked in a co-working space back in my early days, and I didn’t find it that awesome. But it was still better than being at home, where I either worked too much or not at all. Efficiency was quite arguable.

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The open workspace at Node5

When I founded a PR agency with 10 employees, renting A-class office space in the city center, it was great at first. But every time we got stuck on something we had no one to turn our heads to. No doors to knock on. If there had been something like co-working for marketing agencies back in the days, I’d probably let the nice office go at least in a first 1-2 years of our life. Having like-minded people around means having opponents for your ideas all the time. It’s resources you could often use when you’re short handed or worse, when you have too many people. Just a simple coffee at the bar could save you hours of work. I see Node5 members get together everyday and I see them creating things, companies and values, helping and supporting each other. I find it simply priceless.

Lukas: There was a study by DeskWanted in 2013 saying that demand for shared workspace rises by 89% as the independent workforce hits 1 billion. There’s no current number of how many coworking spaces are there but back in the 2013 the number was 2.500 coworking spaces around the world. There are activities such as remoteyear.com showing us, that people like to work not just independently, but also remotely. The same signal we’re getting from big corporations who sends their small teams to work from Node5 remotely and independently from the rest of the company departments. Working in shared workspace isn’t for everybody, except it is 🙂

What’s in Node5’s plans for the next year or so?

Petra: We were working extra hard in the past four months on event production to earn some extra bucks that will allow us to refurbish our residential area, to provide much better working conditions for our residents and bring back a high level of comfort. Other than that, we are also working on a couple of business deals that will provide our members certain perks, that’s something we’ll be releasing soon so you have to wait for that!

Lukas: Recently, we faced a hard decision whether to expand to upper floors to ramp up our revenues, or improve the comfort in the current setup. We’ve chosen improvement and are currently undergoing reconstruction in the residential space. This will provide our members with more privacy for salespeople, more meeting rooms, leisure room, various options of privacy in coworking space and more.

Additionally, what we might be looking at from the longer-term perspective is a program for further support of companies after graduating from acceleration programs, and on growing the real-estate in size and level of quality, as well as range of provided services . We hope our team will help us to build it up for an interview next year.

Vit Horky of Brand Embassy: “Making People Happy”

One of StartupYard’s earliest success stories, Brand Embassy is an innovative, rapidly growing company, tackling “social customer care,” and customer relationship management.

Using this plug-and-play cloud solution, large and small companies can communicate directly with their customers via popular social media channels, like Facebook and Twitter- channels that are increasingly favored by customers looking for the convenience of chatting via social media, and looking to avoid playing email and phone tag with slow and unresponsive customer care teams.

I recently spoke with Vit Horky, Brand Embassy’s co-founder and CEO, about the history of Brand Embassy, what the company is doing today, and what their future plans look like.

How did you and Damian Brhel, the other co-founder, start working together?

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It’s a funny story that starts off in Bageterie Boulevard on Vodickova [in the center of Prague] more than 10 years ago. I was looking to hire a developer for Inspiro Solutions, a Prague-based digital marketing agency I founded in 2004, and I didn’t even have an office to hold interviews. Even though Damian was only 14 at the time I didn’t let his age overshadow the interest I had in his CV. We met, we hit it off and decided to work together on a project. One project led to another and eventually led to Damian being appointed as Technical Director of Inspiro Solutions. He was a far superior developer than the rest even though he was outranked professionally and in terms of age.

Founders Vit and Damian. Photo by Libor Fojtik

Founders Vit and Damian. Photo by Libor Fojtik

I guess it’s also worth noting I was only 17 at the time. So a teenager managing an even younger teenager!

What are your professional backgrounds?

I’ve always been interested in entrepreneurship. When I was 12 years old at summer camp, and a temporary vegetarian, I would take the steak that was part of the canteen lunch and re-sell it to kids who wanted more. I guess that’s where it all began!

By the time I was 17 I founded my first company, Inspiro Solutions, which has since become one of the leading social media agencies in Central Europe. I diversified my company portfolio by launching Inspiro Creative, a software distribution company that became a Gold Partner of AVG Technologies and has served over 10,000 customers since that time.

After several years on the agency side of things, I was fed up working on other people’s projects. I wanted to build something that served a real purpose, that had meaning. It’s that desire to do more than just marketing campaigns that really pushed us to launch Brand Embassy in 2011.

As for Damian, he’s a bit a Mark Zuckerberg :laughs:. He didn’t go to university because he simply didn’t have time – he was already pursuing his dreams. Damian is self taught and has been doing development projects by himself since his early teens.

The agency world was heavily focused on the domestic market, and project driven. Damian wanted something that was more product driven with a global scale that could actually have a positive impact on the way people communicate. Both on the same page, we made a successful exit to focus on the launch of Brand Embassy.  

When Brand Embassy first applied to Startupyard, how did you envision the product and future of the company?

We went to Startupyard with a product that was a combination of software and people. Brand Embassy 1.0 was split between the software and the actual service – rather than focusing on selling the power of the technology, we bundled this with providing actual customer service for brands that didn’t know how to manage social customer service.

9 out of 10 contact center agents are only trained to receive or place phone calls, while 68% of customers prefer to use channels other than phone. With this in mind, Brand Embassy kept a part of their “agency” background, if you will, to help assist brands that simply didn’t know what do with social customer care – from both a technological and staffing perspective.

Then and now, the vision remains “making people happy.” Better customer service as an industry standard means better service for you, me, your mother, your brother, your friends and your colleagues. Delivering happiness through better customer service, via our technology, is still our vision.

How, specifically, did those plans change during and following the accelerator?

During the period Brand Embassy was with Startupyard, the mentors we connected with pushed Brand Embassy to focus on product and scalability. They taught us to look further down the road and think about how we could eliminate the “service” or “human” part of our offering and focus on the technology.

The networking opportunities that we had, from conferences in London to introductions to some of our first clients in our home market, were irreplaceable.

How did Brand Embassy gain its first large investment?

We closed a $1 million seed round investment in February 2014 from two venture capital funds, Rockaway Capital and Spread Capital.

While the investors saw the connection and potential between social media and customer service, I learned that they were more interested in investing in people they believed in rather than the business. They viewed social media marketing software as direct competition to overcome. When in reality, the solutions and reason to invest – from a client’s side – in various technologies is very different. Brand Embassy is first and foremost built for customer service, not marketing – while the opposite can be said for “social media marketing” solutions.

Now, our investors have become convinced by both the capabilities of myself and Damian, as well as the product itself.  

Here’s a look at our growth to prove that point:

Revenue:

  • 300% YOY revenue growth for 3 consecutive years

Global expansion

  • 2013 client portfolio: 80% domestic / 20% foreign
  • 2014 client portfolio: 80% foreign / 20% domestic

Telco Market

  • late 2011: first telco client (Telefonica O2 CZ)
  • By 2012: all mobile operators in the Czech Republic
  • By 2014: global market leader in social customer service software for telco


Company Growth:

  • 2012: 5 employees
  • late 2014: 15 employees
  • mid 2015: 30 (doubled)
  • 2016: still hiring!

Can you share a few case studies and testimonials about Brand Embassy?

Sure! A recent case study showed that O2, one of the Czech Republic’s largest Telco operators,  reduced response time by 70% and increased customer satisfaction by 90% using Brand Embassy. O2 fundamentally improved their “guru” concept with Brand Embassy which put customer service and knowledgeable agents at the forefront for their marketing campaign. They were able to change their brand reputation and position themselves as a responsive company that actually listens to their customers.  

Dusan Simonovic, Social Media Specialist at O2, CZ said: “Brand Embassy connects all our social channels into one space with efficient team collaboration and good workflow for providing fast answers. Flexibility with customization is also a great benefit”

We also received this glowing testimonial from Phil Wilson, Social Media Communication Manager at Vodafone UK: “We’ve seen a major change in the way our customers want to communicate with us. They demand more than just marketing on social media, they want customer service. We believe it’s our job to deliver that exceptional service. That’s why we’ve invested in customer service technology from Brand Embassy, and together we’re well on our way to achieving our goals.”

Brand Embassy was also named a top rated enterprise social media management software by TrustRadius.

Has hiring been a major challenge? How has BE gone about hiring new people?

Yes, it’s been a challenge, but we are progressing.

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We doubled the number of employees in the last 6 months and are still actively hiring. We have a brilliantly diverse workforce across commercial, product and marketing and operations.

Our team of 30, all in Prague, now cover 8 countries including USA, Morocco, Uzbekistan and The Philippines. We’re like a mini United Nations here!   

Historically, we were focusing on hard skills and number of years of professional experience. We found that those people didn’t necessarily have the cultural fit or drive we were looking for. We had to part ways with some very talented people because of this disconnect.

We learned the hard way that it’s more important to find people who are a great company culture fit than those who have x years of experience with x,y,z skills. We want to be happy with them and we want them to be happy with us.

Brand Embassy has a unique brand story. How did that develop?

There are two reasons why we have the “Bee Story.” First, it’s because we don’t want to be another boring software company. The Bee Story helps us add some coolness and fun to our messaging and branding. It also helps us stand out in the crowd, as more than just a software company. We are a breath of fresh air in an otherwise pretty stuffy market.

In addition, the Bee Story helps us explain the benefits of integrated customer care in a very intuitive way. We found that we needed a strong analogy to help describe the importance that efficiency and a clean process have in digital customer service. Bees are fascinating creatures that work in an intelligent hive. That’s just what Brand Embassy aims to be. Our approach, then, is analogous with a natural one that is inherently easy to understand, when you think about it.  

What are the significant challenges of selling your solution to small and medium sized businesses?

A challenge we faced in recent years was the inability to service our smaller clients and offer a solution that fit their needs and budget. They wanted us and we wanted them, but we simply didn’t have the resources to work with them and enterprise clients were prioritized.

Only a few weeks ago, we launched our online sales channel (self-service) and we already have plenty of SME clients starting with Brand Embassy every week.

They are all small business and agencies from around the world.

We see big potential in small e-shops and small business owners who must effectively manage their impatient digital customers too. Especially for e-shops whose customers are 100% accustomed to doing things online. They shop online, they want customer service online.


Along with the introduction of our online sales channel, we are introducing a package for these SME’s that starts at $39 / user / month.

Which competitors do you see as vying for the same core audience as Brand Embassy, and why is BE a better choice for your core customers?

There are many solutions that claim to provide social customer service, however, they usually fall into one of two categories. They’re either legacy solutions that have added social as an add-on, but they are difficult to use because handling a public inquiry on social media is something completely different from receiving a phone call.

Or, they are marketing-first solutions designed for running campaigns and building online communities, but can’t handle high conversation volumes and are generally managed by people who have many other responsibilities outside of customer service.

We fill the gap, offering solutions that are built for social and customer service specifically, handling high volumes and making social customer service smart and enjoyable both for the customers and agents.

For Brand Embassy, it’s not only about social media customer service. It’s about unifying the entire customer service experience across all digital channels.

We’ve increasingly seen that non-loyal Zendesk clients from Central Europe are coming over to Brand Embassy. They’ve been using Zendesk out of necessity, but it’s too complicated and it’s not built for social media – social is just an add on to a more traditional help desk solution. It lacks efficiency – everything other than email is a plugin. Brand Embassy has these digital channels built into the core of our platform.