Introducing the 2015 Startups: Shoptsie: E-Commerce and Marketing For the Rest of Us

Mathé Zsolt-László and Ordog Zoltan, Co-Founders of the online store creator Shoptsie, are two entrepreneurs that the StartupYard team truly admires. Coming from a Hungarian community in Romania, Zsolt and Zoltan rode a bus for 24 hours to make it to their first meetings with StartupYard mentors and stakeholders. Then, to our amazement, they got back on the bus and rode 24 hours home as well.

From our first meeting, we’ve noted their incredible dedication to the Shoptsie mission, and their ability, time and again, to deliver on the promises they make to us, and to themselves. We’ve been impressed, and we’re sure you will be too. I caught up with the duo to talk about Shoptsie, and their time so far at StartupYard.

Shoptsie currently has over 6000 products listed in over 1000 online shops, and that number is growing daily.

Shoptsie-logo

Hi guys! You’re unique among all StartupYard startups. You’re not our first team from Romania, but you are our first team of Hungarians. Tell us a bit about yourselves, and where you come from.

Zsolt: Originally I’m from the smallest city in Romania, in Transylvania, called Baile Tusnad and recently moved to Miercurea Ciuc. I crafted websites for more than 15 years and also I worked 8 years as a database engineer for the government. Now with the launch of Shoptsie this will change. As CEO I will concentrate on running the company, managing the day-to-day operations.

Zoltan: I was born in Miercurea Ciuc and I live there too. After I’ve finished the college I worked in a printing house, then I started to create websites as a webdesigner. After 10 years and numerous websites I joined to Zsolt to work on Shoptsie.

IMG_1587

Co-Founders of Shoptsie: Ordog Zoltan, and Mathé Zsolt-László

Tell us about Shoptsie. Who is it for, how does it work?

Zsolt: Shopstie is an intuitive online store creator for creative people who don’t know how to sell online. It’s very easy and simple. With Shoptsie anyone can create an ecommerce website that can be integrated into Facebook Pages and existing websites or blogs without any coding skills.

After a quick registration you can upload your categories and products, choose a beautifully designed template that can be customized to match with your brand look and feel.

Shoptsie also provides a set of marketing applications with which the store owners can reach more customers. We also created a knowledge base blog where the store owners can learn how to create an email campaign and how to advertise on social media.

shoptsie

Q: How is Shoptsie different from other store creators like Shopify, or marketplaces like Etsy?

Zsolt: Out motto is “We grow with you”.

Unlike any other pay-as-you-go services like Shopify, Shoptsie gives beginners a risk-free entry into online sales.

This means that you can list up to 20 products for free in your Shoptsie store, and sell them at no upfront cost. We don’t make money until you do.

Another differentiator is that we can teach you where and how to advertise to start making sales online. Marketplaces like Etsy are good solutions for selling, we don’t say that people should leave them, but there is a big chance that your product will be listed next to your competitors’ products.

Stores on marketplaces look the same, all you can do is maybe upload a banner. With Shoptsie you can have your own professional e-shop which you can personalize to match your personality, your brand’s look and feel.

Also, when you are advertising your marketplace store, you’re also advertising the marketplace at the same time. Why don’t you spend your money on advertising your own brand?

Q: How can your users advertise their goods, and where can they sell them? Do they need their own websites first?

Zoltan: They can use their social network, without having  their own websites. That’s a key area of growth for small scale businesses selling online. Shoptsie offers an app that helps these sellers find Facebook Groups with similar interests, and another app with which they can create a Contest to collect emails. Another – quite popular – app is the Facebook App that let our users embed their stores directly in their own Facebook page.

This is part of what makes our approach unique: we aim to provide all the tools a seller needs to market and sell their goods online, so Shoptsie is more than just a place where people can find your goods – it’s also a tool that gives you comprehensive and easy access to marketing tools, and shows you how to use them.

Have your users been able to make those tools work for them?

Yes, and I have a great recent example. A few weeks ago we noticed a spike in one store’s statistics. We saw a huge number of visitors from one day to another that we did not expect. It turned out that one of our store owners started a really successful contest on Facebook. He grew the number of visitors by 200% using our tools.

He’d decided to promote one of his products by making it free for a whole week. Then he held a raffle for anyone who shared the link and liked his Facebook store page. This simple trick was enough to drive and increase the traffic to his online store, and his sales increased as well.

Because he was offering a free product (charging only for shipping), he was able to make a lot of sales quickly.

People started to order this product, but some of them added another product (that wasn’t free) to the cart. So the next day there was a big list of orders waiting for delivery.

Now that he has contact information for his clients, he can create email campaigns about new products, promotions and other contests.

So, by giving away one product and sharing this on his Facebook page, in two weeks he managed to increase his sales by more than 80% and collected a big number of email addresses.

That approach is also showing results when it comes to our own growth. Because we focus on helping our sellers market their shops and goods, we’ve seen user-generated sales campaigns that have also increased awareness of Shoptsie. The more quality shops and sellers Shoptsie has, the more we are able to reach first-timers who have never really considered selling online before. When they see how easy it is for others to do it, and that our approach is risk-free, they’re much more likely to try it for themselves.

Screenshot 2015-05-05 16.51.04What types of sellers are you focusing on at first, and why?

Zsolt: We are focusing on handcrafters and fashion designers. At the first we wanted to give a solutions for everybody but we saw that most of our customers came from the crafting and fashion industries, so we are focusing on creating the perfect ecommerce solutions for them.

In the future, as we implement support for digital products, we want to reach creative artists, designers and creative writers as well.

Our near-term goal is to attract as many high-quality, active shop owners as we can. We grow with our user base, so their success is our success. We think this is a model in which everyone wins, from the consumer, to the seller, to crafters who have never tried ecommerce before.

Will you focus on specific geographic markets when you launch?

Zoltan: Yes. Because we speak the languages and we know the region, first we want to focus on the Hungarian and Romanian markets. As the number of our clients from UK and South  Africa is also increasing, we want to focus on those markets also.

Q: How has your vision for Shoptsie changed in the past few months? 

Zoltan: Two months ago we had a picture in our minds about how we wanted to develop Shoptsie further, so we thought. But at StartupYard, that picture was slowly replaced by a more concrete reality. The plans we make now feel much more real- much more solid. 

We are grateful that we can be here. This is a big opportunity for us to learn and to meet mentors who can answer our questions, and shorten the feedback cycle, so that we don’t repeat or fail to notice the mistakes we make. 

We were encouraged by mentors like Liva Judic and Wallace Green to continue what we started and keep our users’ needs in mind. 

Q: What do you see as the biggest challenges you face in getting people to adopt your solutions?

Zsolt:  It’s an interesting question. We see fear of the unknown as our biggest challenge. People are afraid to start selling online. They are good at what they do, crafting or designing, and they think that creating an e-shop is rocket science.

Well it’s not. Shoptsie provides them with everything they will need to create, promote, and run their online store, easily and without any coding skills.

Shoptsie is now live. Create your own Store Here. 

Introducing the StartupYard 2015 Startups: Myia: Making Wifi Accessible Everywhere

The Myia team joined StartupYard with not much more than a great idea, and the will to make it happen. Since they’ve been at the accelerator, it’s been a pleasure to see that idea grow into something truly unique and interesting.

Originally designed as a hyper-local messaging app, Myia has evolved into a concept with truly global potential.

It will be a platform that brings Wi-Fi as a common utility to a completely new level. Users around the world, at conferences, hotels, or other public spaces like shopping centers, will be able to access locally relevant services, information and communication channels, seamlessly and instantly with Myia.

Myia will also help Wi-Fi providers offer new services to their customers and visitors. 

This is an idea who’s time has truly come, and Myia wants to be the company that finally delivers on the promise of easily accessible Wi-Fi, anywhere you go.

I’ll let Ondrej Cervinka, CEO of Myia, tell you more:

Myia-Cervinka

Ondrej Cervinka, Ceo of Myia

 

Hi Ondrej, First off, I’m sure people are curious about your company’s name. What’s the backstory there?

Oh, it’s a long story but I enjoy telling it. Originally, the name was Xin, which is a Chinese word with many different meanings depending on the pronunciation – sign, letter, heart, mind, feeling, soul, intelligence, new, fresh, true, real.

It was perfect name for the messenger functions we had at that time. We built Myia originally as a Wifi based local messaging app. However, we received some negative feedback from American users about the name- it was hard to say, and seemed too foreign for some. So we were looking for another name.

One day we were discussing the name with a great StartupYard mentor, Liva Judic, and we thought: “Wait a minute, Liva is actually a nice name”. Unfortunately, Liva has been registered as a trademark so we couldn’t use it.

But we already liked the idea of having a feminine name, so we ended up with Myia. I like the name very much. Myia was a Greek philosopher and one of the daughters of Pythagoras. I like math, numbers and philosophy. So it is kind of attractive to me. Actually, it is pronounced as “mee ya”.

Unlike most of the other startups in StartupYard 2015, Myia came into the program with something very different from the new core product. What motivated you to join the accelerator?

A: At the beginning of 2015 we had a mobile app in all 3 app stores. It was simply a messenger that allowed users to send messages to anybody connected to the same Wi-Fi.

It was actually an outcome of a Microsoft Windows Phone hackathon organized at the Prague Impact Hub, where our company, WujiGrid, has offices. We had promising user responses and a lot of ideas for other features to add and how to improve the technology.

At that time StartupYard had just opened applications for its 5th batch of startups. We immediately jumped on the opportunity. Our goal was to use the mentors provided by the StartupYard program.

We wanted to consult with them on our business ideas and build a viable business model for Myia. We were also prepared to hear that there was no real business in Myia, and that we should keep it just as a toy app and do something else.

So the reason to join the accelerator was to get help with the areas where we did not feel very strong – business modeling, sales, and marketing. After one month in StartupYard we can say it was definitely a good decision.

How has your vision for Myia evolved over the past few months?

Our first goal was to narrow the possibilities for Myia down to one or just a few. It’s funny, but each day with mentors brought new ideas, new areas where Myia can be useful and new use cases. So at the beginning, the options didn’t get narrower, but wider.

We evolved the vision of Myia into an app that has two faces: First, people who install the app on their smartphones and second, providers of Wi-Fi, the owners of the hotspots. These two groups depend on each other.

The Myia Platform

The Myia Platform

For consumers, Myia is an app that provides a valuable functions and features depending on the type of place – restaurant, bar, café, concert, hotel, shopping mall, conference, airport, etc. Wi-Fi is ubiquitous technology today.

With Myia, you can meet new people, find a pool player in a pub, learn what is hot and cool in this place, get discount coupon or a voucher, rate presenters, vote for the best gig on the stage, contact hotel front desk, you name it. It is useful, it is fun, and it is relevant to the place where you are now.

Myia is also for the businesses who offer free Wi-Fi for their customers and who are looking for ways how to provide more added-value to them. It provides them a unique communication channel to their customers.

They can learn opinions of their guests and collect feedback. They can announce new shops in a mall, happy hours in a bar, send special offers. It is easy to postpone start of the first presentation after lunch on a conference, collect questions and rate the presentation. We can build loyalty programs for different businesses.

What has been the biggest challenge in adjusting your early vision to incorporate so much feedback from the StartupYard mentors?

A: As I said, we got a lot of feedback, ideas, opinions and advice from the mentors. Quite often they were even contradictory, which is great because we got wholly different perspectives.

We see it from many different angles now. So many different ideas are of course difficult to sort out. We cannot do everything together but we do not want to spend next 6 month on something that just to find out it’s a dead end.

Certain use cases work well only after there is certain percentage of people who use Myia. Of course, they will use it only if it brings them some value. So there is a classic chicken-or-egg problem here. After somebody installs the app they want to find many places where they can use it. So you have to start with something where people go often.

At the same time, Myia must bring a compelling value proposition both to the owner as well as to the end user. And we try to make it as viral as possible.

We are still working on this – trying to come out with different value propositions for various areas, test them with businesses, evaluate, and find overlaps with other areas. I see it as an organism. If everything fits together it starts to grow.

Tell us a bit about your background, and that of your team.

A: I am a programmer by profession. I studied artificial intelligence at CTU and then worked on various AI projects in Rockwell research center here in Prague. Then I joined a Swiss software house named IPS in 2000.

I met my Myia cofounders Filip and Michael there. Actually, Michael was one of my computer science students when I did my PhD, and Filip was the first candidate that I interviewed in my life.

Myia Team

The Myia Team

 

At the end I was director of the IPS Prague branch and Filip was software architect in IPS. Then in 2010 we decided to found a startup called WujiGrid. It is a real-time collaboration app. It is kind of a shared desktop but it is in the cloud and it belongs to everyone in the collaboration group. And now we are with Myia.

So we have worked together for 15 years! All three of us are software engineers, so we might be weaker in sales and marketing. But very strong point is mutual trust. It is great if you know we can rely on each other in difficult times.

Q: Who will be your earliest clients? How will Myia make its first dollar on the market?

A: We’re working with businesses to pilot the service in different areas. StartupYard has helped us with their contacts and we are also doing very interesting things with Impact Hub Prague, which is our home turf.

We participate in Hub events and do networking games where Myia helps you to meet people that you are looking for. We really appreciate this cooperation.

Our plan is that the service will be free for the early adopters. This way we can spread the service as fast as possible because the more people use Myia the more useful it is for everyone. It will also help us to define exactly what value our users see in the service.

I think we will make the first dollar on some customization or implementation of specific functionalities for a large business. On top of that, we hope that the module for events will be the first paid service.

Q: Where do you see Myia as a business in 2-3 years? What do you see as some promising use cases and unexplored markets for the technology?

A: Ok, it’s going to be interesting to read this answer in 2-3 years from now, right? Long term, even with WujiGrid, we are interested in interaction between people, communication, collaboration, combining their skills and talents. We see Myia as a communication accelerator.

It puts together people who are at the same place at the same time. They meet with the help of Myia but then they interact in a real, natural way. Today everybody talks about social networks. Myia creates a network that is tightly linked to the real physical world.

Every day we meet a lot of people we do not know by name. Sometimes we meet them regularly, like on a bus when you go to work in the morning.

Imagine you lost your wallet in a foreign city where you are on a business trip. What do you do? Now Myia can tell you “Hey, there is a guy who takes the same bus as you every morning in your hotel, do you want to ping him?” He might help you, right?

Or your flight is delayed by 3 hours, you sit in the airport having nothing to do but wait and Myia beeps: “There is somebody waiting in the next gate who visited the same concert of Groove Planet you just attended last night.” Suddenly, you have a beer with them and enjoy the time.

Or business-wise, an airport shop can suggest there is new Groove Planet CD available. Ok, there will be no CD shops in 2-3 years, but this is the idea. From the technology point of view big data, machine learning, mathematical modelling, etc. this will be our way forward.

Q: This is a crowded market- some players in public Wi-Fi access include T-Mobile and Skype, as well as Google. What makes Myia special in your view?

This is difficult question. Myia relies on existing Wi-Fi infrastructure, so we see T-Mobile as a partner, the same is with Skype Wi-Fi. If a business place provides a Wi-Fi hotspot with any of the existing providers, Myia is able to bring some new monetization opportunities for the business owner.

Google relies on advertising, which is not what we plan to do. But I do not want to rule out your question based on just these examples. There may be some players in the market already, but this does not mean there is no space for more innovative players.

In fact, I think the fact that there remains no single preferred solution for wifi shows that the market is not fully mature yet- and there are a lot of opportunities to find new efficiencies.

The demand for public WiFi continues to grow, and as it does, the opportunities to add value in that market also multiply- we don’t see “competition” in that sense to be a bad thing at all. The more players in the market, the more customers will be aware of new possibilities, and have an opportunity to choose Myia for the value it adds.

 

 

Meet the 2015 Startups: Trendlucid: Mapping E-Commerce and Predicting the Future

The StartupYard team has liked Jaromir Dvoracek and Jan Mayer, co-founders of Trendlucid, since the day we all met. Infectiously energetic and passionate about their ideas, the Trendlucid team have also impressed our mentors with their vision for automating e-commerce business intelligence in the near future.

With their roots in data consultancy, Jan and Jaromir have branched out to develop their considerable combined experience by turning it into a tool for e-commerce, that they say will be able to predict the best sellers in any product category, up to two weeks before they reach number one.

I’ll let them tell you about all that, and more, below:

trendlucid

Most of our Startup co-founders are close, but you two often seem like twins. How did you start working together, and form Trendlucid? 

 

Trendlucid-Jaro

Jaromir Dvoracek: Co-Founder of TrendLucid

Jaromir:  We worked at the same company for a few years but actually never side by side every day. We’re trying it with the TrendLucid for the first time. And we’re twins definitely, but we’re quite different from each other, too.

TrendLucid lies on the top of our previous work of gathering and selling data for e-commerce price intelligence. It’s a logical next step in solving problems for e-shops. And Jan took this opportunity and crafted it into a side project, which became our main business opportunity.

TrendLucid: Honza

Jan “Honza” Mayer, Co-Founder and CEO at TrendLucid

Jan: I don’t agree! Twins often look and behave more similarly. Our strength is that we are completely different. I keep track of things and focus on value, Jaromir on the other hand adds sparkle to the ideas and creates the buzz.

In a few words, what is Trendlucid, and what does it do?

Jaromir: TrendLucid is a visual representation of the market giving you actionable insights about the product.

Suppose you’re a purchaser for an e-commerce site, and you need to know what to stock; what will be hot in the next few weeks. With Trendlucid, you can see a snapshot of all the products from a particular category (like smartwatches, or tvs, or washing machines), across the whole market at once. This includes pricing from other e-shops, and review information from as many sources as are available.

You’ll be able to quickly see how you can position yourself against competition in terms of price, but more importantly, which of the items on the market are actually reviewing really well, and being talked about most.

If there’s a winner with some room for a good profit margin, you can see that opportunity instantly. So if you’re using Trendlucid, you’ll be able to ensure that you’re offering the best prices, on the best products available.

What experience in data and e-commerce do you have that informs your work on Trendlucid?

Jan and Jaromir at a StartupYard workshop with our director Cedric Maloux

Jan and Jaromir at a StartupYard workshop with our director Cedric Maloux

Jaromir: We started 5 years ago as a consultancy for retailers of consumer electronics, as they need to know the prices of distributors. So we monitored the distributors for their prices and stock counts.

We continued as an e-shop scraping platform – clients sent us the products and we returned the list enriched with prices from competitors.

Today, we’re making that ability to view the market as a single map available as an on-demand tool, with even more market insights included in the graph that we are able to generate.

We’ve made the market something that retailers can explore, rather than something we have to investigate for them individually.

Jan: We had started with mining social media platforms, discussion and forum mentions from the whole Czech internet, and we’d sell that information to partners like Socialbakers.

One day a very “lucid” idea came to us – Why don’t we merge these two data sets to see not only what products people talk about, but what they eventually buy, and how that data correlates?

And the results were pretty interesting. We confirmed that the number of mentions and ratings strongly correlates with total sales of any given product. Moreover, we were able to use our market intelligence tools to determine that a lot of e-shops don’t have enough interesting products in their portfolios. Worse- they don’t know they have a problem!

What can you do that an e-shop or e-commerce company can’t do on its own?

Jan: We actually solve one of the biggest problems for e-shops: having the right products at the right time. If you stock a product that people won’t buy at the price point you anticipate, it’ll cost you a fortune to move the products- you’ll have to cut prices to move the stock, and that eats into your margins. On the other hand, if you can stock products that aren’t popular yet, but will be popular in a few weeks, you’ll be ahead of your competitors. You won’t have to cut your prices to get rid of stock no one wants to buy.

Jaromir: Every successful e-commerce works intensively with data nowadays. TrendLucid enriches and validates internal data from e-shops so purchasing managers and marketers can see if they’re behind the market. Every e-shop has internal data about sales. But they don’t have comprehensive overviews of market data. And that’s what we are fixing. Our vision of TrendLucid is to fully understand what people want to buy and automate purchasing management based on this information.

TrendlucidScreen1

Trendlucid provides a market overview for specific product categories, showing the popularity and prices of products on each market. Users can zoom in to examine specific products and see a market overview for each one.

 

Through the mentoring process, you got a lot of conflicting advice- lots of big ideas. How did you get to your current vision?

Jaromir: Surprisingly we’ve received only two big contradicting pieces of advices so far. And it was “go big very quickly with a huge investment” vs. “your conservative approach to grow the business makes sense”. Our vision has been refined after hundreds of questions from our mentors at StartupYard. But business strategy was a much more oft-discussed topic.

Jan: We started with very simple idea: “Let’s show to e-shops what products they miss”. But they were so excited they wanted to know more. While we could show them very detailed and clear overviews of the current market, what they really wanted to see was the future- what will sell best 2 weeks from now? That’s a harder questions. We knew that the future of a product and the phase of it’s lifecycle can also be revealed in data, but the mentoring process really helped us to see that those insights were where the real value was for us, as a business.

We thought initially that the most important users of our engine would be purchasing managers for eshops. But one of our mentors, Wallace Green, who has a lot of experience with marketing, showed us the necessity of data to e-commerce marketing. He introduced us to the concept of the “smart marketer” who makes his decisions based on data, not on instinct.

This helped us to see that TrendLucid could also have a future as an insight tool for marketers, as well. As marketing becomes more data focused, there is an ever-increasing need for more granular and precise data on what people are talking about, and how that correlates with their buying decisions.

What will be your initial approach to the market? How will you make your first dollar? Where will you launch the service first?

Screen2-Trendlucid

Trendlucid also provides in-depth pricing data on specific products across a whole market.

 

Jaromir: We’ve already made our first dollar! We’ve been selling e-commerce data for 5 years now. So in a sense, TrendLucid is simply evolving into something more visible on the market- less a consultancy, and more a product for marketers and e-shop owners. We’ve taken our internal tools for visualizing the market, and made that available to more potential clients to try for themselves.

Jan: As part of making TrendLucid more of a “product,” than just a data consultancy, we contacted czech e-shops and offered to them trials of TrendLucid’s new market mapping software for a month in exchange for their valuable feedback. It’s working nicely so far. We want to follow Dan Hastík’s strategy, which he used with Futurelytics – integration with big e-commerce platforms (like Shopify).

Variations in price can be quite wide on higher margin items.

Variations in price can be quite wide on higher margin items.

We also found out that TrendLucid has many valuable metrics for manufacturers. They can measure brand awareness in many ways already. But they’ve not yet been able to measure product awareness for all their products on each market. That’s a game changer. With TrendLucid, they finally can.

Electronics, particularly online, are a generally low-margin business. What makes electronics e-commerce interesting for Trendlucid?

Jan: Social media has become important to understanding how consumers behave, and important in selling to them. And personal electronics have enabled and accelerated this trend as well. Electronics have become an element of personal fashion.

People want to buy a new smartphone every few months now – like new socks. We’ll see that even more with the rise of wearables in the near future. So consequently people talk a lot about electronics on social media and elsewhere. And that makes our insights into the market even more granular and valuable.

Whereas 30 years ago, consumer electronics was divided into just a few categories: personal, appliance, entertainment, they now represent a huge diversity of categories, with more choice than ever before. So purchasing decisions for e-shops become increasingly more difficult, even as margins are dropping.

This market segment has low margins and the fights for market share are pretty bloody. But at the same time, many e-shops miss out on big winners all the time. That’s actually why e-shops need TrendLucid to get ahead.

Jaromir: It’s hard to monitor this market manually. You can’t store all the information you need about phones, tablets and notebooks in your head, much less predict what features and individual products will be most popular. You can watch manually what is popular on the market and what you should try to sell. But no one person can have a complete handle on this market anymore.

It might be easy to pick the next big winner, if you’re comparing two or three competing products. But try it with thousands of washing machines, microwaves and televisions which are not so interesting for most purchasing officers. Try it with the ever-expanding list of wearables that are entering the market- all targeting a different market segment.

The problem with electronics is that the products change so fast. You can predict which type of socks will be popular for a sustained period, because our needs don’t change that fast. But electronics don’t follow these old patterns anymore. Now our needs change too fast for any individual to keep up.

That’s what our first client in Czech Republic found out: we  automatically identified the next best selling washing machine 14 days before it happened. Most of the e-shops stock best sellers 6 weeks after they’re already popular. That’s 8 weeks of margins they’re missing because they aren’t using TrendLucid.

What do you see the Trendlucid platform being capable of in a few years? Who will be your customers at that point?

Jaromir: We’ll be able to see trends worldwide. What’s popular on the American market today will be popular in central Europe 4 years later. What’s popular in Germany today will be popular in Slovakia 2 years later. What’s popular in South Korea now will be popular in the US a few months later. With TrendLucid you’ll be able to look back in time to see what you can sell successfully next month. You can prepare for changing market trends based on statistics. You’ll never miss the train again. This kind of information would be critical for big e-commerces, brands even for big retail players. We haven’t gotten to the level of understanding and complexity we need to be able to make those types of global, multi-year projections with real accuracy and speed. Nobody is really there yet, even if they claim to be. But that’s where we want to be.

Jan: Yep, that’s our first target. The second target is brands. We can tell LG, or Samsung, or any big brand with lots of products, which of their products people are talking about, in which countries- and what they’re saying. They’re working on “brand awareness” now. We can give them “product awareness”, which is one level more precise.

Right now we’re like Klout for products on the Czech Market. We’d like to apply that capability globally in the future.

Meet the 2015 Startups: Ales Teska, CEO of TeskaLabs, Enterprise Security Masterminds

This interview is part of a series, Introducing the 2015 StartupYard Teams. We’ll be posting detailed interviews with the founders of each of our 7 teams, in advance of StartupYard Demo Day, May 28th, 2015 in Prague. 

Over the past 5 weeks, as the StartupYard team and mentors have gotten to know Ales Teska, founder of TeskaLabs, we’ve liked him more and more.

Careful in his speech, and precise in action, he is creative, with a contained energy. He often displays a rigor and discipline to his thinking that can be unusual among startup founders, few of whom can match his 17 years of industry experience. Perhaps his calm temper is best suited to his chosen profession, which is perfecting plug-and-play enterprise security solutions.

Ales Teska (right) working with a team member

Ales Teska (right) working with a team member

TeskaLabs, named for the founder, who has extensive corporate experience as a project manager, began life as the sum of many years of experience and frustration dealing with corporate security demands. Teska’s industry experience is exemplified by TeskaLabs’ early customers, including British Gas, NetworkRail, and DHL Supply Chain.

 

Now Teska is bringing his experience to the market as a one-stop solution, providing enterprise grade security solutions for industrial and consumer mobile applications.

Teskalabs offers a plug-and-play information security platform for any connected device via software, hardware and/or SaaS products. TeskaLabs’ solutions reduce deployment time forrobust enterprise network and mobile security from months, to only minutes.

gvowapAlI sat down with Ales this week to get more of the TeskaLabs backstory. Here’s what he had to say.

Hi Ales, why don’t you tell us a bit about the TeskaLabs team, and your journey to StartupYard.

TeskaLabs has been my dream from my early 20’s. I launched my first business when I was only 18 years old. It was an Internet cafe in my hometown Jablonec nad Nisou which quickly pivoted to a software business catering to smaller local enterprises.

Since that time, I’ve tried a lot of different jobs. I led a team that created software and hardware for a multimedia delivery system and spent some interesting time in Taipei.  In the last ten years, I’ve worked at the world’s largest logistics corporation, DHL, as a software development manager.  

My teams worked on various enterprise applications including mobile apps. I’m a very creative and productive person. While doing corporate work, I also did a series of side projects and launched several successful products. For example, I created a distributed measurement system for mobile operators, for monitoring the quality of their services. I also did an online project management tool. There is a couple of open-source projects I initiated out there too.

During this journey, I met a few great people who decided to join me and motivated me to come up with more innovative ideas, which, by the way, is incredibly difficult in a corporate environment. TeskaLabs evolved around these people and ideas. This is a materialization of my vision of how truly innovative things can happen through a great team in the modern day.

We were seeking experienced advisors and mentors who could move us to the next level, and we found them at StartupYard.

How has that original vision for the company changed during the first month at StartupYard?

TeskaLabs as a company has quickly become much more mature. The key element of our vision remained unchanged and reinforced during these few weeks. We are now on the verge of a new working era.

Enterprises are starting to shift from desktop computers and notebooks to mobile devices such as smartphones and tablets in the same way we moved from typewriters to computers in the past.

Unfortunately common understanding of connected security risks within today management in the enterprise is not appropriate, and black-hat hackers frequently take advantage of that. We save such enterprises from these painful lessons. We’ve learned that this is very real and present situation.

During the initial mentoring sessions, our mentors Wallace Green from Cap Gemini and Lenka Cerna, CEO of Annonce.cz highlighted that we should show what we are protecting the business against.  We also need to provide a visibility to this electronic frontier. This advice was very eye-opening.  We at TeskaLabs live in the world where cyber threats are  present and real. Now we understand that we need to bring this information to enterprise executives to help them assess these risks and effectively mitigate them.

What about TeskaLabs makes you a startup, rather than an ordinary security consultancy?

The core of TeskaLabs is research. I believe that only deep insight and cutting-edge technology can provide solid and active protection. For us, it is extremely important to deliver an excellent experience not only for the end user of the mobile application but also for developers of those apps.

Now, you probably ask yourself how mobile application security can impact user experience.  Usually, these two don’t go hand-in-hand. The user experience is sacrificed due to many long password fields and lock screens. Even worse, security is sacrificed by the act of doing nothing. Our goal is to deliver both: excellent streamlined user experience and uncompromised mobile application security, very  important for industrial applications.

Can you imagine, for example, field engineers or fork-lift drivers who type 10 or more character long passwords, case-sensitive, at least one number, one symbol, etc. every time they want to use their mobile device? These are difficult but important challenges that we solve.

How can you save your customers time, money, and liability with TeskaLabs products? Why do people need your solution?

The costs of information security incidents such as data leakage or disruptions of operations in the enterprise sphere are enormous. Just look at recent Sony Pictures Entertainment incident. A conservative cost estimate of this hack starts at 15 million dollars.

That could be low compared to the chilling effect it can have on the movie industry- fear of hackers will affect productivity in many industries in the future.

True. Imagine needing a two step verification every time you checked your email! This would seriously impact productivity, especially on mobile platforms.

Many companies recognize the importance of mobile devices for business use.  The users can access business resources from various mobile devices at their convenience to improve productivity, and companies can enable access to business resources through native mobile apps to improve user experience.

However, introducing mobile devices in the enterprise presents additional security challenges. These days, large and complex organizations approach small app development agencies.

Due to different understandings of priorities, security aspects of such deliveries tend to fade away. And, generally speaking, enterprise mobile apps are not secured well enough.

We fill this gap with TeskaLabs, so that agencies can build very secure apps, meeting the tough security expectations of enterprises. Even more importantly, we save these enterprises from extensive and painful experience of being hacked.

The TeskaLabs team

The TeskaLabs team

 

Many big companies already have in-house security teams. Why is TeskaLabs a viable alternative, either in terms of cost or quality?

To be responsible for information security within a big enterprise is a tedious and demanding job. You need tools that are flexible, stable and scalable. Something that will frictionlessly integrate with existing corporate infrastructure, adapt easily to all current and future requirements and run without the need of too much supervision, however, raise a clear red flag when anything goes wrong.

During my corporate career, a security team was my  important partner because I deeply believe that application security is a crucial component when you build enterprise applications. And this is especially true for Internet-facing apps such as mobile or web ones.

Therefore,  I can say that I’m very familiar with expectations of people responsible for enterprise application security, and TeskaLabs went the extra mile to bring products that reflect on this experience.

Our products are their tools, and we are keen on giving them the best possible experience they ever get when it comes to mobile application security.

How does Seacat and other TeskaLabs projects fit in with the competition? Do you compete directly with AVG, or Avast?

Our belief is that the best strategy is to build security directly into a mobile application. This is how you get the best possible result in the most efficient way.

Our unique ability is to provide this in a very easy-to-use package to a large crowd of mobile app developers, and through them to even larger crowds of users within enterprises.

Traditional security solutions complement rather than compete, because they address different layers of security e.g. operating system or data.

The most vulnerable point of an enterprise mobile app is not on the mobile device but the backend system. This is where the majority of cyber attacks happen. The design of our solution respects this fact, and so we provide very strong protection here.

This is a completely different approach from AVG, Avast and others. But indeed, it is a great idea to have antivirus installed and activated on your mobile devices.

You’ve been asked by a few mentors why you felt the need to join an accelerator. What do you feel you’re gaining from taking part in StartupYard?

StartupYard is a once-in-the-lifetime kind of experience. When you sit in a corporate job and read about these accelerators and the stories of companies that go through them, it is a very surreal experience.

The pace and the scale of possibilities are simply incomparable. A right accelerator can be a slingshot for your vision and business. It not only shows you what possible but challenges you to reach even further.

We’ve met so many great people in StartupYard e.g. Michal Pechoucek from Cognitive Security, Adam Zbiejczuk from ROI Hunter, Michal Illich, Ondrej Krajicek from YSoft.  It pains me not to list all of them. Thank you all!

This is a reinforcing experience.  You repetitively meet people who share your vision and understand your passion,  gradually transforms your dream into a clearer and more visible path.  StartupYard is making sure we are set to go.

Male Founders: Make a Woman Your First Hire. But Don’t “Hire a Woman”

It’s now over two weeks into StartupYard’s 2015 cohort, and by now our startups have broached topics with our mentors ranging from their go-to-market strategies and branding, to their pricing models and customer acquisition costs, to the exact wordings of their positioning statements.

The real challenge, in fact, is that these conversations have to happen over and over again, in widening and tightening spirals of detail, until the startups can conduct pro/con arguments about every aspect of their short and medium term strategies in their sleep.

Hiring Ain’t Easy

One thing that I think doesn’t come up quite often enough at StartupYard, and probably at most accelerators, is hiring. We know from our own survey of startups at December’s LeWeb conference in Paris, that hiring ends up being the bane of most startups’ existence within the first two years, and certainly after a largish funding round is closed.

Most of our teams are composed of friends- people who worked or studied together, and see their relationships as organic and natural. They sometimes naively believe (or simply refuse to doubt) that this same cozy, non-confrontational arrangement will slowly snake its way out into their ever expanding network of collaborators, and that they’ll never really face tough hiring decisions.

The Happiest Team is Not Always the Best Team

But there are multiple points of failure in this approach, and we’ve seen them happen with our startups as well. While a team of friends is essential to starting your business, that doesn’t mean that this will translate into the perfect team to grow that same business.

Companies that get some funding, and already have a team of friends in place, are in danger of falling into the same patterns they developed as a scrappy startup. It worked before, so why not now? Well, in scrappy startups, everybody does everything, and productivity is assumed to measured by the creative output of the group.

That’s the “move fast and break things,” part of a startup’s life cycle. But once a capital injection has been received, there are going to be other metrics for success- and these new metrics are going to be measured in very different ways. In the same way that the old wisdom goes: “you have to move out to move up,” so it can be with hiring: you have to look outward to grow.

Challenge Your Assumptions

So why should hiring a woman be among your first priorities? Now, let’s all slow down for just a second, and I’ll explain what I mean by this. “Hiring a woman,” and hiring a woman, are two separate things. And while I don’t personally look as askance upon “hiring a woman,” as some very persuasive people do, hiring a woman just to have hired a woman shouldn’t be your goal in this endeavor.

We can get far ahead of ourselves, and decry the idea of hiring women in non-technical roles simply because we feel that they transform our work environments into more pleasant places to be. I don’t see why that’s a bad motivation to hire a woman, but it certainly shouldn’t be the sole, or even the primary motivation either.

Hire a Woman. Don’t “Hire a Woman.”

For every study showing that simply having a mix of men and women on your team and in your work environment makes you more productive, more friendly, more honest, and happier, there is a legion of female engineers who find those things incidental to the fact that talented people, including women, deserve to be hired on their merits alone.

And those who point out that focusing on the productivity benefits of hiring women tends to depersonalize and dehumanize the actual women who are hired because they fit that bill, are right to do so. That isn’t my personal experience, but my personal experience is limited, by necessity, to being a man who has had some very skilled and seemingly well adjusted and happy female co-workers in technical and non-technical roles.

I’m sure that if you asked them, they might very well feel differently than I imagine. I’m not a mind reader, after all. It’s all enough to inspire quite a bit of handwringing from first-time male founders who genuinely want to do the right thing, but are seemingly boxed in by devils on either shoulder.

Don’t Have an Existential Crisis Over It

Either you risk not being progressive by not being proactive, or you risk being condescending without even realizing it. Some may remember American Presidential candidate Mitt Romney, and his “binders full of women” gaff. He was (rightly) lampooned for objectifying women, but he was also trying to do the right thing- in an admittedly half-assed  way.

It’s quite possible that as a male founder, you will simply be unable to avoid mistakes in this area. Being the boss isn’t easy. You could just keep your head down and hope for the best, or you can stick your neck out. I feel obligated to push for the latter move: hire a qualified woman to whatever role you first need to fill.

And by a qualified woman, I mean exactly that. Search for and find a woman who is qualified to fill the role you need filled- whatever it is. Don’t take the first woman who comes along, and make her your office manager, just to check the box. Although you may eventually hire a female office manager, that isn’t the point of the exercise.

Avoid Douchiness

At the same time, don’t hire a woman who isn’t qualified to fill the role you want to fill- and don’t then pay that woman less than you’d pay the person you wanted to hire. That’s just douchey. Pay this woman the amount you set aside for a qualified, valued candidate. Because that’s the only type of woman you’re going to hire.

Men who are hiring often feel that they understand other men more easily. I think few would argue that it’s easier for men to evaluate the skills and talents of other men, because men tend to think and act in ways that other men can easily recognize.

Plus, if you’re a newly-minted male founder who has never managed a team before, managing a bunch of guys might seem easier. It’s more like schoolyard football, and many of us men aren’t that far removed from a schoolyard mentality.

In our schoolyard mentality, we want girls around for us to show off to. We want lunchladies and moms. That’s not sexist, as much as it is infantile. But startups are not typically judged on the basis of their emotional maturity.

What we don’t understand is frightening to us. If you’re hiring a woman, seeing her for her true talent and value might be difficult for you. Embrace this difficulty, and try to do it anyway. You could make better decisions than you would by following your gut.

What This Accomplishes

First off, it’s no secret that women are chronically undervalued in the tech industry. Surveys collected by Quartz show that women make up only around 12% of the engineering workforce of large tech companies. They fare better in non-technical roles, and at smaller startups.

In part, this reflects the rate at which women graduate from engineering programs in the west. However, it may be the opposite of the trend one might expect: that in the meritocratic, and egalitarian environments of big tech, the best performing women might find more jobs than in bro-dominated Startupland.

So, we can surmise, there should be *more* qualified women looking for jobs in startups, in proportion to men, because women are less likely to occupy technical roles at large companies, where the security of a steady paycheck draws many a coder. There are probably even more qualified women looking for work in non-technical roles.

And here’s a bonus: women are generally paid less than they deserve in these non-technical roles, so you have the opportunity to recruit women from jobs that they would otherwise be content to stay in, by offering a competitive salary. By holding out for the well qualified female candidate, you’re likely to find someone more talented than if you simply latched onto the first guy who came along.

Open-Sourcing StartupYard

Last Thursday during our Open-House event, the first StartupYard event of the new season, I announced my intention to “Open-Source StartupYard”. Today I would like to come back to this and share with you more about the logic behind this new initiative.

DSC03330

Cedric announces the “Open Sourcing” of StartupYard, to include free, publicly available resources, events, and mentorship for local startups.

 

Schroedinger’s Startup

StartupYard is a great resource for the founders who are selected to join the program. They come in and during these 3 full-time months they will learn a lot. I had the pleasure and pride to see the progress of each team and there is nothing more rewarding for me to see them thrive and impress their customers, partners or potential investors.

Still, StartupYard is like a black box. A proprietary solution accessible only to a lucky few. Unless you are accepted to the program, you don’t really know what’s going on inside (even though we do share a lot of this information on our blog). But most importantly, only accepted teams really benefit, hands on, from what we do.

 

Our Mission Goes Beyond our Own Teams

If our mission is to make our region, and our city a place where risks are worth taking, and innovation is not only possible, but required, then we have a responsibility to more than just our own teams.

I want to change this. I strongly believe that if we can help the community at large, it can only benefit the economy and the lives of more people. If our mission is to make our region, and our city a place where risks are worth taking, and innovation is not only possible, but required, then we have a responsibility to more than just our own teams. Being an entrepreneur is one of the most difficult and stressful jobs out there, and you will need all the help you can in order to succeed. It’s not because you have the ability to automate a workflow or a service that people will rush to it to use it, or investors will throw money at you like it’s 1999. You will have to learn how to present it, how to manage it, how to plan it etc. And if you can do that, your ideas can really change the world. Without that, even the best ideas will never get anywhere.

For this reason, I have decided to make some of the knowledge we share and impart during the program available to a larger audience. I used the analogy of the open-source movement because, first I’m a strong believer in this model, having relied on and contributed myself to the open-source movement, and second because this is something StartupYard will do absolutely free of charge. Free as in Free Beer!

 

How Will This Work?

We are going to select a few specific domains in which we think first-time entrepreneurs could benefit from more knowledge and experience. Pitching, for example. Once you have an idea, the first thing you are most likely to have to do is to convince people it’s a good idea, i.e. you’re going to have to pitch. Pitching is not easy, and StartupYard Community Manager Lloyd Waldo and I have already written extensively on this topic, on this very blog.

Last week, during the Open-House event, the audience sat through 8 ninety-seconds pitches, and it was clear that the majority of the presenters could do with more training on how to grab the attention of a live audience and deliver a compelling story. It’s not that hard, and there are a lot of resources out there, but nothing can beat a one-to-one coaching session. Unfortunately, those are not that easily available locally. This is typically the kind of topic we work hard on during the StartupYard program, putting teams through extensive feedback from mentors and the StartupYard team, and this is the kind of resource we are going to make available.

In no particular order, we will run free workshops for tech entrepreneurs on:

  • How to pitch efficiently
  • How to write a Press Release
  • How to use best practices in copywriting
  • How to make user projections
  • How to plan a launch
  • How to make financial projections

 

The final list is not finalised yet but the goal is clear: the more founders we can train on these topics, the more likely they will be to succeed. For me, this is a strong motivator and goal, and we plan to help as many entrepreneurs as possible outside of our regular acceleration program. These sessions will be one-to-one, personalised and free. That being said, our time remains a limited resource, and you will still have to apply for available spaces, but we will do our best to accommodate as many of those interested as we possibly can.

The sessions will start in January. We will post the registration form and the program then. Stay tuned, and I look forward to helping as many entrepreneurs as possible to grow their skills, and discover the ones they didn’t know they had.

 

 

Education Content Platform and StartupYard Alum Educasoft Secures Funding

Educasoft, creator of Hrave.cz and MyPrepApp, content systems for secondary school test preparation, have announced this week that they have secured a 5 figure investment from an unnamed private investor, to focus on the Czech test preparation market. We caught up with StartupYard Alum Vaclav Formanek to talk about Educasoft, MyPrepApp, and the investment process. 

So Vaclav, tell us about Educasoft since you left StartupYard.

Well, as you know, we were one of the few teams who entered StartupYard in the last round with a functioning product, and even some customers. We had been working on Hrave.cz for some time, but we were at the accelerator to build a more “global,” education product, MyPrepApp.

At the end of acceleration, we really just had a prototype, and a good sense of where we were heading next. In the first 6 weeks after StartupYard, we really had to keep working on the product, and prepare our marketing channels, Facebook registration for users (so they could sign up for MyPrepApp through Facebook), and other things that we needed to really launch a paid product. It went from an experiment to a real business in that time.

What I see as the biggest step in development since then was that we opened our CMS to partners. We want to be more than an application, but rather a platform for content creators. We aren’t the primary content creators, so we want to attract content creators by being an easy, effective platform for great educational content, that allows that content to be used by students in an effective, fun, and focused way.

We have developed some potential content partners as well, ranging from regional content developers, to one content creator who is focused on a single university. I really enjoy seeing how the product scales so well to these very different uses.  The content partners we have attracted really know good content, and they are interested in piloting the use of Hrave/MyPrepApp to publish content on their markets. These early partnerships are really important for us in validating this business model.

 

What are some of the difficulties you’ve encountered in repositioning Hrave.cz as a more global product?

Vaclav Formanek talking MyPrepApp at StartupYard Demo Day 2014

Vaclav Formanek talking MyPrepApp and Educasoft at StartupYard Demo Day 2014

Well, Hrave is essentially the Czech local version of MyPrepApp, the global product. It has acted as our laboratory, in a market we know best and can easily test in. The goal for the next 6 months for us is really to learn how to do business in the Czech Republic.

We left StartupYard thinking that MyPrepApp would be a more global product, much sooner. But we’ve learned that we need to spend more time on the local market before scaling globally. We don’t see this is a failure, but to be honest, it was difficult to convince investors that we already had a winning strategy for a more global product, and they had good points. We needed a stronger testbed for the product, to allow it to mature over a longer period. So we’re growing more slowly than we thought we could be, but this change of direction was, I think, still the right thing.

 

Was that a disappointing outcome for Educasoft?

I am a bit disappointed by this, but I chalk it up to experience. It wasn’t catastrophic for us, at all. Our future doesn’t depend on being a global product overnight. We still got to take advantage of the exam season in Czech Republic, and we are still growing. We also got to slow down and build our team more slowly, which allowed us to make some smart hiring decisions. We have recruited some great developers and business managers who we might not have found otherwise.

We got very deep into discussions with a few investors. This process really reshaped the business, and talks with investors did give us good ideas. But it took a lot of time and energy, and we weren’t able to arrive at terms. That was hard, but I’m glad we went through it.

 

Why is innovation so important in the Education field? What are you doing that major publishers like Pearson can’t? 

What I see as most important is that education has to somehow follow the trends in students’ lives. Modern students consume and interact with content in very modern ways. If the  educational process wants to be successful, it needs to be tailored to the way that people interact with the world today. That is not really the way education currently works.

Educasoft is about providing the best educational content possible to each individual student. Not all students are lucky enough to have great teachers, and we hope that technology will fill that talent gap- making good teaching available to every single student. Some teachers are fun and interesting, but some aren’t. We want to bring fun and interesting ways of learning to every student. So our goal isn’t just to reform the education system from above, but to reach students on an individual level, and then do that as many times as we can.

I think when it comes to major publishers, the difference is that they don’t see being fun and enjoyable as an important goal. They only see outcomes: students are statistics to them by necessity, but we think about our products on a much more human level. We are motivated to be engaging and fun, and we are closer to the students, making that possible for us in a way that it isn’t possible for major publishers. Agility is a huge advantage when it comes to innovating in education. We’ve done questionnaires, and they get huge response rates- 10% of our users respond. And the thing that comes out of these is that students want customized study plans, which really stears our development in a very flexible way.

The way we will find success and survive is to be accountable to the students first- not to the system that they inhabit. That is fundamentally different from how major content publishers work. It’s not just about persuading a huge district or a school to buy our content, but about appealing to each student with content that speaks to them. We can communicate also with individual teachers, and actualize their feedback in a much shorter time. So I feel that we are living closer to our students’ real needs of today. That’s not something a major publisher can do, or even has a reason to do.

Vaclav Formanek, getting passionate about education.

Vaclav Formanek, getting passionate about education.

 

Let’s talk numbers! What kind of traction does MyPrepApp/Hrave have? 

August was the first month from which we have real data. 1,100 registered users, which is 6% of the target group for Hrave.cz. 20,000 students retake maturita exams in September, and we got 6% of them, with a 2.5% conversion rate. We were hoping for better, but we learned a lot from that first push.

Now the new school season has started, and Hrave has 10-15 new users every day, about a thousand since September. The numbers are still pretty small, but we’re improving our conversion rate between visitors and registered users. We’ve been able to track our website changes and leverage them to significant increases in the conversion rate. We’ve also established a really good track record for technical issues- we haven’t missed any sales due to technical issues at all.

Visit time averages for all users was over 16 minutes since September, and we have a 40% returning user rate, which we are really happy with. What I also see as a good thing is that we’ve started learning how to study user behavior, and increase our conversion rate. We’ve established some gamification elements to sell licenses, and we’ll keep perfecting that.

We’ve also learned a lot about A/B testing for email marketing, and we’re in a much better position now. This is how lean startup methodology works- we meet every week, and we always start with 10 key metrics. Everyone in the team has to see how they “move the needle,” and influence the metrics in a positive way. It’s very motivating.

 

You recently closed an investment. What has been the hardest objection to answer with your investors? How have you solved it?

Our first investor was interested in how we were planning to succeed on the US market. That was a hard thing to tackle for us, and it led to us taking this different approach.

Our current investment is mid-five figures, and the terms were much better than with previous investors that we talked to. He really believes in us, and that has made this process relatively easy. Maybe that also means that our current plan makes a bit more sense, or is a bit more realistic when it comes to a real chance of achieving our goals.

 

Where do you see yourselves in 6 months with Educasoft?

There are 3 big goals for us in the short term. First, we are developing a “multi-player arena.” Imagine Mortal Kombat, but with a study prep angle. We think that will have great viral potential, and it’s something we are exciting to test.

Second, we want to leverage the content we already have for content marketing, to generate more traffic for our paid product. Good interactive content glossaries that are focused on explaining of key terms any student need to know to pass a particular exam are lacking in the Czech market.

Third, the tailored study plan we mentioned early. This is, I think, going to be a really killer feature. We’ll be able to convert many more paid customers if we can create an easy-to-use, intelligent test prep plan, based on actual student needs.

We also want to broaden our content base with new courses and content, including grammar school admission tests for younger kids. We are also working on a pilot program for the Polish market, because of the similarity of the test prep system there. To help us grow, we are testing affiliate marketing and content marketing strategies.

We are looking to get mid-five figure revenues within 6 months, and we have an ambitious goal in that regard. We want to nail down the Czech market fully during that time, and be in a great position to scale to nearby markets.

Ondrej and Vasek taking a break on the TechSquare swing set.

Ondrej and Vasek taking a break on the TechSquare swing set.

 

How did your time at StartupYard have a positive impact on your direction as a company?

We came to StartupYard with just a prototype and dreams. During the program and mentor sessions, we learned a lot about how to shape our dreams into achievable plans, and how to present these plans to other people in a way that makes them both attractive and realistic.

StartupYard had a very inspiring atmosphere. The fact that you’re there every day meeting mentors, who “made it” and you are surrounded by other teams who are just “making it” makes you believe that you will succeed in the same way.

 

Which of the StartupYard Mentors has been most helpful to Educasoft, post acceleration, and why?

We have been in contact with a bunch of StartupYard mentors who have been helping us with fundraising. Director Nikola Rafaj is one person who was extremely helpful and supportive for us during the investment negotiation. In the last weeks we have been consulting about investment terms on almost daily basis and I am sure It would have been much more difficult for us without him. Thank you, Nikola!

StartupYard Mentor Philip Staehelin: “Rapid Change Creates Opportunity.”

Philip Staehelin is one of StartupYard’s most popular mentors, and a very long-time Prague based expat, with experience in a diverse range of businesses. We caught up with him recently to get his take on mentoring with StartupYard, in advance of our Accelerator Open House, taking place on Thursday, Dec. 4.

Philip, you’ve got an amazingly varied background and career. Swiss-American, born in New Zealand, educated in France and the US, and based now in Prague, you’ve been at A.T. Kearney, T-Mobile and UniCredit, and you’ve invested in startups and real estate. What inspires you to stay in The Czech Republic?

I’ve been based in Prague for the past 20 years. My wife likes to think I stayed because of her (she’s Czech), and while I don’t reject that view (openly), the more well-rounded answer is that the Czech Republic is a dynamic place with a very high standard of living. Obviously, things have changed tremendously since 1994 when I arrived, but that’s been part of the fun. Rapid change creates opportunity – and with a strong drive and lots of hard work (and throw in a dash or two of creativity) – I was able to capitalize on the opportunities that came my way. It’s been a fantastic 20 years.
Tell us a bit about your entrepreneurial ventures. What have been your biggest successes and failures in that arena?

A: I founded my first startup while I was studying at INSEAD in 1999. Four fellow MBAs joined my team, as well as the CEO of the investment bank where I used to work. I thought we had a killer team with the perfect concept. We raised some angel financing so we could launch the mixed offline/online, PC-based, ad-serving product… when the internet bubble burst. The business model became rather toxic from one day to the next, making further progress nearly impossible. I shut it down, returned 70% of the money to the investors, and eventually sold the IP a few year later – more for closure than for money. The bubble bursting certainly wasn’t the only reason we failed, but it’s a nice excuse. I learned a lot of valuable lessons in that first venture, even if it didn’t make it too far.

In terms of biggest successes – I would briefly mention two. #1: I bought a house in 2000. After fixing it up and living there for a few years, I ended up tearing it down and built 4 terrace apartments on the lot. The house won the Gran Prix of Architecture award for 2008, and the project ROI was fantastic. #2: A more traditional startup entrepreneurial success is Video Recruit (www.video-recruit.com). I founded the company with a partner nearly 4 years ago after coming up with an idea on how to revolutionize the recruiting space. The real coup was finding the right partner (now the CEO), and together we put together a solid core team, raised the early stage financing and developed a solid rollout and expansion strategy. The company has gradually built a global presence, and in November 2014, the company secured EUR 1.5m in new financing to help scale up globally. It’s a work-in-progress, but it’s an amazing company with huge upside potential. I believe it can become one of the true Czech startup success stories.

What do you get out of mentoring at StartupYard?

A: Mentoring at StartupYard is really fun for me. I love interacting with the teams, hearing the ideas, critiquing the strategies and business cases, and feeling the energy of people with creativity and passion. I also like to see how the teams engage with my ideas and challenges. And finally, in the cases where all the stars align, I invest in a team – the most recent being Gjirafa, the Albanian search engine.

What value do you feel your mentoring provided to the teams you’ve worked with?

I’ve worked in many different industries in many different roles, so I can bring a big picture perspective when necessary or dive deep and challenge the business model, business cases, or commercialization strategies. Some teams need guidance in defining a real sales channel strategy, whereas others need help with building a solid business case that will speak to investors. In some cases, I’ve pushed teams to completely rethink their value proposition – using what they’ve created but coming at it from an entirely new direction. I make what I hope are helpful suggestions, supported by logic, experience and intuition… and of course, teams are welcome to challenge me back or ignore the advice altogether. At the very least, I hope to prepare them for the hard questions potential investors will ask in the future. Overall – I must say I’ve had a warm reception from every team, every time.

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What skills or tools do you feel the teams you’ve mentored have lacked most? What do they need to learn?

To generalize, most teams are very small and by definition they lack some skills or tools as they get started. But if we go beyond this obvious statement, I think that teams don’t necessarily lack skills or tools per se, but rather they simply lack business experience.

For instance, I’ve seen a lot of teams that lack a clear sales strategy or lack an understanding of how difficult and expensive the sales process will be – especially in B2B concepts that are too complex for online sales or telesales. The ideas can be great, the management team can be strong, the technology solid… but some concepts will require a door-to-door sales force, with long sales cycles, and sales teams that will need to be properly managed and incentivized. This is often a step that has not been properly developed, but it’s a key step when developing a business case.

I’ve also seen a lot of teams that have a very difficult time putting together an investor pitch. Getting them to boil down their concept and value proposition to a few, easily digestible but stimulating slides is extremely challenging. That’s often hard for seasoned professionals to be honest, so helping a team to think more from an investor’s perspective can be a good starting point. Startups simply need to learn to summarize their amazing ideas properly – not providing too many unimportant details and making sure the key value is clearly visible.

Have you stayed in contact with any of the teams from previous cohorts? If so, what prompted you to go the extra distance?

I usually follow up with a handful of the teams after my official mentoring engagement is over. I’m usually curious how they’re developing, I want to know if I can be of any more help, and I also may want to know if there’s the potential for an investment.

Accelerators are a really recent development. If you were yourself at 25 and had a project, would you apply for an accelerator? Do you wish now that a StartupYard had existed when you founded your first company?

I think the concept of accelerators is fantastic – and I absolutely wish they’d existed when I launched my first company. Of course, there will always be startups that don’t need an accelerator – especially those startups with more experienced teams. But for the majority of startups with young, highly motivated, inexperienced teams, the value that an accelerator can add at the early stage of a company’s existence (or pre-existence) can be critical. The accelerator can provide that extra impetus to a team that will give them the confidence and the tools necessary to have a real chance at creating a successful company.

What is the one piece of advice that you seem to give the most often to young entrepreneurs, and why? 

Although I always tailor my advice to the specific challenges the entrepreneurs face (and I definitely want to avoid sounding like a broken record), I guess the one piece of advice that does surface more often than not regards the definition of the core value proposition. I referred to this earlier, but to put it succinctly, many teams have a hard time developing a conceptual elevator pitch. Spending the time on this exercise at an early stage is always time well-spent in my opinion, not only because you might get the chance to pitch the concept to an investor or strategic partner at a chance meeting, but even more because it helps to crystallize the essence of what the team is developing, so that the team itself will be able to understand where it needs to focus. This can be hard – especially for technology focused teams where there can be a disconnect between having a cool platform and serving a real need (or “scratching a real itch” as I like to put it, which leaves more room for meeting unrealized needs). When the teams find themselves under stress and worry about resource and time constraints, they can refer back to the elevator pitch (in essence, the blueprint of their business) to make sure they’re going in the right direction and not on a tangent. I’m not saying teams shouldn’t pivot – many teams should pivot – but that decision needs to be explicit, and not just an accidental drift into a new strategy. So the bottom line is: “Know where you’re going, and know why you’re going there”. 

Meet the 2014 Founders: MyPrepApp. Motivation, Not Information.

As we continue to introduce the Founders from StartupYard 2014 and their products, we bring you Vaclav Formánek, Founder and CEO of Educasoft, maker of MyPrepApp, a motivational planning device for exam preparation. 
Vaclav Formanek, getting passionate about education.

Vaclav Formanek, getting passionate about education.

Vasek, tell us about MyPrepApp, and Educasoft.

MyPrepApp is a mobile and web application that helps students to achieve on their important exams. It’s a way for students to avoid the stress of major exams without avoiding the actual studying: it gives you a reason to study, and it makes the process fun, and, we hope, a lot less painful.

Did you have trouble studying as a kid?

I was a kind of nerd as a kid. I started to have some problems with studying at high school and university, as I found there were much more interesting things to do than studying.

I started this project with my best friend Ondřej Menčel (Ondřej is CTO of Educasoft) more than two years ago. We loved playing games and we were fascinated with their motivational power. We were asking ourselves a question: if games are so cool that they motivate us to spend hours and hours solving problems in a virtual world, couldn’t we use some of their power to motivate ourselves to do real things, such as studying?

I was never a good studier. I guess that’s the typical experience, but it creates a lot of stress. I couldn’t ever decided what the important stuff was, and how to prioritize when I was studying. So I would procrastinate, and end up cramming for the exam at the last second out of panic. Everybody’s had that experience right? Studying was boring and nothing motivated me to start early. Have you ever had that dream where you show up for a test, but you aren’t prepared, and you don’t know what to do? That’s our inspiration.

MyPrepApp is molded out of our personal experiences. It creates a tailored study plan for exam preparation, and uses game rewards and support of friends to enhance students´ motivation to follow the plan and reach their study goals.

When I am saying “we” I am talking about our company Educasoft. Educasoft is a team of people who want to provide students a better way to prepare for exams.

Ondrej and Vasek taking a break on the TechSquare swing set.

Ondrej and Vasek taking a break on the TechSquare swing set.

Your team has already launched and generated revenue with a similar service in the Czech Republic: Hrave.cz. How did Hrave become MyPrepApp?

Well, we launched “Maturita hravě,” our first product, in preparation for the Czech exit examination, just a few days before the exam actually took place. So it was really a baptism by fire. It was just a last minute thing, so you can see a pattern here!

But, we were really surprised by the results. Within the first week, more than 5000 students tried out Hrave, and feedback was mostly very positive. When we were thinking what to do next, we decided to focus on what was crucial for passing the exam, and what’s really missing from existing products for exam preparation: tailored study plans and enhanced motivation to study. User feedback showed that the main problem with studying wasn’t informational, but motivational. This became the basis of the MyPrepApp model.

 

The education technology field is crowded. What makes MyPrepApp a potential stand-out in your thinking?

We take a different approach towards studying for exams. We see achieving on exams as the same type of goal as, for example, being able to run a marathon or losing 10 kilos, and we think we can use similar methods to help people achieve these goals. That´s why we are inspired by successful fitness and running apps such as Endomondo.

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We are focused on students with low self-motivation. Students who need a study plan and who need to be intensively pushed to follow it. We think that this group of students has been ignored by existing exam preparation products. Most of these, like Kaplan Test Prep, Magoosh, or BenchPrep just assume the student is motivated from the outset… but we know that isn’t the case.

Our goal is to be the best preparation app for those students – the ones who need someone to tell them what to study and motivate them to do so.

What are the technical and business challenges you think you’re going to face in the next year or so?

The big technical challenge for us is creation of the study plan. We take it very seriously, as by recommending what students should study, we become partly responsible for them and their results. To be able to create a good study plan, we need to combine knowledge from many different areas – from the perfect knowledge of tests to the psychology of learning.

As for business challenges the biggest one will be to entry the US market. I think we will need a business partner to do it in the most effective way.

What strategy are you pursuing for bringing the platform to a global market? How will you secure and grow a strong content network?

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We have been developing the platform itself to be content independent, so it can be used for most of standardized exams, no matter which system they are for, in Czech republic, Poland or the US. While the exam systems are very different between different countries, our approach can remain constant.

As it is quite easy for content creators to use our platform, we can choose the best strategy for getting the relevant educational content for different countries and exams. Similarly, we can choose the best strategy to market MyPrepApp in different countries. We are now in the process of deciding for which countries to find strategic partners, and in which we can branch out on our own.

Which of the mentors at StartupYard have had the most profound impact on Educasoft during the past few months? How has the accelerator been for your team?

Generally the mentor sessions have helped us a lot to make our plans more precise, and prioritize the next steps. Roman Smola (Founder of Glogster EDU) had amazing knowledge about how to be successful in the US market with educational products. Vit Horky (CEO of Brand Embassy) has a really interesting approach to business development, that we learned a lot from.

Unfortunately I was the only team member who could atend most of the program during the first month of the accelerator as the rest of the team had to stay home working on the app so we could launch it as soon as possible. Though we find the accelerator very useful.

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Meet the 2014 Founders: Gjirafa, Albania/Kosovo’s answer to Google

In our continuing series, we are introducing the StartupYard 2014 teams in individual interviews with their founders and key members at the accelerator. Here we introduce Gjirafa, in the words of CEO and Founder Mergim Cahani, of Kosovo. 

 

Mergim, how would you describe Gjirafa in a few words?

It’s an awesome animal with a long neck :laughs:.

Gjirafa is a full-text web search engine and a news aggregator specialized in the Albanian language. Gjirafa will bring relevant information that will be easy accessible to over 12 million Albanian speaking people worldwide.

So it’s Google For Albanian Speakers. Isn’t That Job Already Taken (by Google)?

You could say the same thing about Seznam or Yandex (the Russian search giant), but they’ve thrived in competition with Google. That’s a great model for us moving forward.  Competition between Seznam and Google have brought better results for consumers in the Czech Republic. Google doesn’t own the internet, and it shouldn’t.

And no, we aren’t Google. We have something that Google does not have. Gjirafa has access to local data, understands the market, and has been developing technology for full-text search in Albanian language. That’s something no one else has ever done, including Google.

Albanian stands alone as a language with no relatives.

Albanian stands alone as a language with no relatives.

Gjirafa is turning quite a few heads with our mentors at StartupYard. Why do you think that is?

Our team is built to impress, with a very strong business and academic background. Three founders have a combined 30+ years of experience, one previous successful startup, four masters degrees and one PhD. The advisory board features prominent figures in web search and management, Prof. Torsten Suel and Prof. Jay Nathan respectively.

We are very happy to be getting so much positive attention, but important to note is that mentors’ inputs and constructive feedback is shaping our product and company further. From day one at StartupYard our value proposition started to get better and better thanks to mentors’ feedback. The reason why most mentors and investors are interested, we think, is that our project has the prerequisites to make it promising: a strong team, an excellent market potential, and the technology – specifically our differentiating product features.

Mergim Cahani: Founder and CEO of Gjirafa

Mergim Cahani: Founder and CEO of Gjirafa

What brought you to StartupYard? What have been the benefits for you, so far?

I am certain that StartupYard is de facto the best accelerator that our team and project could have picked. In fact it is the only accelerator that we wanted to be part of (within the context of this project). It has just about all the ingredients of other accelerators, including the ones from Silicon Valley, and then some – that directly gives us better opportunities and increases our chances of success.

Mentors, investors, angels and VC’s, involved with StartupYard can more easily comprehend the potential of our project at our targeted market than other investors from other geographic areas. There are great similar success stories in the Czech Republic, and some of these investors are involved directly in those projects (www.seznam.cz is one example). They understand our product, they recognize its potential, and have a clear idea what it takes to reach our goal. This way, they can provide feedback that is so vital to company success, and some have already shown interest to be part of this journey.

Where to start with benefits of StartupYard :laughs: We love Prague, StartupYard at TechSquare has an amazing working environment, great people, a lot of events, and, can’t forget,  great Czech beer. As far as accelerating our project growth, we have meet some industry leaders, Chairpersons, CEOs, and investors from world leading corporations, who really helped shape our product and increase our value proposition immensely. Also there are a lot of perks, to mentioned one: we are en route to becoming a BizSpark plus company (that is around $60,000 in azure credit that we were planning to spend). Last but not least, people who run StartupYard know their business- they have a proven track record and experience that was evident from day one.

left: Cedric Maloux, Director Startup Yard. Right: Mergim Cahani, Founder CEO, Gjirafa

left: Cedric Maloux, Director Startup Yard. Right: Mergim Cahani, Founder CEO, Gjirafa

What are your near-term goals for Gjirafa? What products and services will be part of the ecosystem at launch?

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Our near-term goal is to launch within two months. We are planning to include a few “elect” services at the beginning. That means a full text search, news aggregation, a transport scheduler for Kosovo, Albania and Macedonia, weather widget, and Albanian web facts. All these services are one of a kind, as they currently do not exist anywhere. The obvious exception is text search, where Google is a player, but we think we can do a better job, as we are focused only on one language and one specific segment of the web. That’s worked for Seznam, and we think they’ve shown us the way to success against the Google Goliath.

How about your long term goals?

Our long term goal is to become the front page of the Albanian speaking web. To be synonymous with “Internet” in the Albanian mind. If you speak Albanian, when you open a browser, it will open on www.gjirafa.com. We will provide highly relevant services and ease of access to information that is geographically localized and based on the Albanian language. Gjirafa will be more than just a useful search engine, it will be everywhere for everything. I will not speak to specific services that we plan, but I can tell you that there is a full list on queue that we are prioritizing; each one of them more valuable than the next.

As a sneak peak, enabling e-commerce in Albania and Kosovo, at this moment, tops the list of our long-term goals. Replicating the platform to other Balkan peninsula countries, is also a viable option.

You’ve mentioned developing a unique search engine for the Albanian language. Can you tell us about the development process?

It was fun! :laughs: That may sound extremely nerdy, but I don’t mind. It was really fun.

Working on this from Kosovo was a different experience than the time I spent in the United States; where in my last job I worked in a typical corporate environment. Previous to that I was in Academia, and being able to work full time on a project that I loved, what can I say? It was thrilling.

I turned one bedroom of the house into an office (this startup was luxurious; no office garage)! I used a bit of my prior experience with developing large-scale full search engines, from my Masters program at NYU Poly School of Engineering, and the very valuable help of my mentor Prof. Torsten Suel, to create all the pieces needed for the Gjirafa engine; multi-threaded crawler, indexer, query processor, and a few things in between. I developed a prototype that was not the best out there, but it was good enough and I was happy with the outcome.

The biggest limitations at the beginning were hardware and bandwidth, plus latency, and occasionally an algorithmic problem that kept me up at night. Later, two friends joined me as co-founders, and now we are working on making the engine even bigger and better. One co-founder Ercan Canhasi, PhD, is working on the search engine, while the other co-founder, Diogjen Elshani, MS, is working on the business development side.

Why do you think competitors like Google haven’t focused on Albanian speakers,

Google hasn’t ignored the market completely. I think they’ll regret their absence.

The scalability of Google allows it to fit almost any market given enough data. But there are two problems here (1) currently there is not enough data for the Albanian language on the web, and (2) the Albanian language is one of the most lexically unique language in the world. Google can’t search something it doesn’t have; it can’t index information that currently does not exists on the web. As far as the language goes, Albanian is one of the a few languages that does not derive from another language; it is a branch on its own. Processing a language (intelligently), means some knowledge is needed for that language. Linguistic research in English, and for a lot of other languages, exists. There is almost no linguistic research for Albanian that applies in this context. We are currently researching and developing Albanian grammar and syntax for NLP.  We have done the groundbreaking work that will tie Albanian speakers together online, through their language.

Kosovo’s political situation has undoubtedly held back business development in the region. Do you see the situation as improved enough for the region to compete on a level with the rest of Europe?

It is true that the political situation in the region has set back development. But things have started to take a turn, and Kosovo and Albania are becoming emerging markets especially in technology development. Based on our web mining data, the Albanian web is still in the early stages of development, but it has doubled in the past year and it is continuing its growth rapidly. That might sound like not much, considering that the whole size of the web increases at the same rate, but the difference is that the Albanian web has been expanding its core economic value at a much greater rate than the average. It is developing, and that means there are enormous positive gains to be made across a huge range. The rest of Europe will not see its web experience improves by 200% in the next 2 years. Albania and Kosovo will see that kind of improvement.  This web infancy is one of the reasons why the market is not penetrated by global companies, which makes it a logical reason why our project represents a great opportunity right now.

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What’s your general strategy for marketing Gjirafa? Google has name recognition in search all over Europe. How can you compete with that position?

Our position is with the unique services that we provide for users that Google, and other competition, do not. People need information, and currently can not get it online, and we feel that this market has been left behind – but they will be able to find it on www.gjirafa.com. Also, we will provide a targeted platform for merchants that will enable them to reach their customers. That aspect of the online economy is completely absent in Albania/Kosovo. Can you imagine that? It’s 1999 in online advertising there. Imagine what that means for the future. Our marketing strategy is diverse and a combination of several channels. Without going into specifics, we have a few marketing strategies planned for direct and indirect marketing.

 

Gjirafa is planning to launch its full text search engine in July of this year. 
You can connect with Mergim via Linkedin. 
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