Brendan's Blog

Whistles.co.uk

2009-11-10T12:48:00.003Z

I saw today an article on econsultancy about a relaunch of a womans clothing site called Whistles.co.uk. Given I don't buy many woman's clothes I may be way off the mark commenting on this but my sense is that they have done something very clever perhaps for the first time.

I think they have created a pleasurable browsing experience and combined this with ease of purchasing. What's unique about that you might ask? Surely there are lots of good ecommerce sites that look nice aren't there? Well; No! Actually I don't think there are. It has been a problem that has always exercised my mind and I think a lot of it has to do with understanding that the way we shop for computer parts or objects which we don't attach to our body is very different from the way we shop for those that we do.

What is the ideal way to choose clothes? To try them on your own body, you get the size, the feel and the look in front of a mirror. What's bad about that though? people waiting around crowded changing areas, lots of changing rooms, for some too much fuss. What's the second best way? Projection + Practicality. You see a model with the clothes on and think damm that looks good if I buy that I will look good too, next thought is what size am I once you know that you can buy.

It's worthy of note that some guys don't even project before they buy, clothes can be purchased purely on the basis of practicality rather than as any form of self expression. Also of note is that a lot of people using flash to develop web sites that are capable of an ecommerce element have tended to be more practical types. So what I think is different is that ecommerce has finally figured out its strong card.

That is when I go into a store there is only so much wall space for pictures of models. In fact probably less than 5% of the clothes in a typical store are represented by models in posters displayed at that same retail outlet. Whereas on a flash web site there is potentially an unlimited amount of space so 100% of the clothes I want to buy can be modeled. The success of clothes by mail order was driven by this, they figured out that projection as well as practicality was key to generating intent to purchase so most lines were modeled and pictured.

The new flash technology is taking this further. Now I am not saying the web site is the height of usability. Simply that it has a nice balance, it is pleasurable to browse around and this allows me to start the projection of what clothes might look like in aesthetically pleasing surroundings. This type of experience is a marked change from browsing in a more functional layout which typifies most ecommerce sites in this sector and in general. Yet under the hood is the power to quickly switch my mind from projection to functional "what sizes are there available?" mode and back again with minimum hassle.

Thinking also of the success of zappos I think part of it at least was down to the fact that they focused on shoes first. A shoe has a definite form, you can browse it comfortably in a functional environment because you know the shape it will be on your body is the same as the picture. A flat picture of a pair of jeans does not do that you need to see what it looks like on a model what is the cut like in real life to get the same projection going in your mind.

In short whistles doesn't hurt my head and that can only be a good thing hopefully they will launch a menswear range soon.

Saturday afternoon inspiration

2009-02-28T19:23:00.002Z

I was doing a bit of thinking today about defining Fubra's goals and my own for the next few years and I have stumbled across someone who is quite inspiring his name is Sir Ray Tindle and he actually lives near me in Farnham, perhaps I'll get to meet him one day.

I was curious about him and so I checked out his accounts and indeed he has built a pretty amazing business since the second world war which now has nearly 60m in assets no debt and is consistently throwing off over 5m a year in profits.

The most inspiring thing about him is that he has does all this by running lots of newspapers I've never heard of, local ones that I didn't think could be hugely successful especially given the recent performance of many of the larger companies in that space. Sir Ray has had a single minded focused approach to his business. He understands local newspapers are about local issues and never tries to grow them beyond the locality they serve.

There are a number of lessons I have learnt from reading about Sir Ray Tindle and the first one is quite important. It's a lesson I thought I knew a lot about and that is that with hard work and focus you can achieve anything given time. Over the past few years my focus has waned and I haven't been happy with what we have achieved at Fubra. I put a lot of this down to seeing and getting carried into the excesses from a period of unsustainable borrowing which caused me to focus externally and procrastinate for a period of perhaps two years or so, short termism set-in and I became envious or angry at the perceived wealth of those who appeared to take a short view and keep winning.

Al Ries is a person I think is smart and he has a video about all about focus.

I always recommend it to people but it hasn't been until I read about Sir Ray Tindle today that I really started to believe what I was saying to others properly. I used to think Fubra was unfocused because we have lots of web sites, have built loads of tools but we are not in truth I think Paul and I know very well what our focus is. I am not as sure we have communicated that very well to others around us including our staff, our customers and our visitors.

I've decided I really want to start doing a better job at communication so I will be starting today defining a clear road map for what we will achieve as a minimum in the next 5 years. In truth I will be happy anyway if I can continue to experience the determination and enjoyment it's clear Sir Ray still gets from sitting at the helm of one of the most interesting businesses I have come across in a long time.

Which leads me to the most important thing I learnt from reading about Sir Ray Tindle - make haste slowly.

a priori truth

2009-02-03T00:31:00.004Z

I am completely fascinated by starting to re-read Discours de la méthode pour bien conduire sa raison, et chercher la verité dans les sciences at the moment.

"I entirely abandoned the study of letters. Resolving to seek no knowledge other than that of which could be found in myself or else in the great book of the world, I spent the rest of my youth travelling, visiting courts and armies, mixing with people of diverse temperaments and ranks, gathering various experiences, testing myself in the situations which fortune offered me, and at all times reflecting upon whatever came my way so as to derive some profit from it."

Having foundations in life is really important, following your principles everyday, even more so, reflecting when you don't, still more.

I feel very lucky to know that.

10 Credit Crunch tips for first time Entrepreneurs

2009-01-15T00:17:00.003Z

Here are a few tips I think can help start-up companies to be successful based on my own experiences I hope you find them useful.

1. Buy something for a £1 add some value sell for £2 just to start off with.
Trying to climb everest without the proper equipment is a sure route to failure. By starting a small business which buys goods and sells them you will learn to deal with customers and how to satisfy them. If they feel like are getting a good deal they should tell their friends about you and you will sell more. If they don't like your business they will either buy once and never again or they will tell you they are unhappy. Ask your customers what they think of your products they will tell you.

2. Focus on the value of everything not the price.
Good entrepreneurs pay the value of everything they buy not the advertised price, in this world everything is negotiable and you should learn very quickly there are lots of mispriced products and services around. Every single mispriced product presents an opportunity to save if you are buying it or to compete if you want to sell it.

3. Get some grey hair on your team early on.
There are lots of people who have run their own business and if you are just starting out the CEO of Tesco might not have time to help you out but successful local business people would probably be only be too happy to help you out, network with them ask them if they would like to be a non-executive director for your company for a very small shareholding and if they can help you with occasional advice and counsel. Maybe try and see if there is a service or a product you can offer them first to build a relationship with them.

4. Your customers are your best friends treat them like it.
One happy customer tells more than one person, lots of businesses have customers but not as many take the time to get to know them and ask them how they can better serve them. Make sure you are not one of those businesses. How about offering your customers a referral fee if they introduce their friends, I did this early on by giving £50 to all my previous customers if they helped me sell my next computer.

5. Don't believe the business haters.
The people closest to you, your best friends and family especially if they have not run a business may not be as supportive of your new venture as you first expect. This is probably because they care about you and don't want to see you fail or get hurt, for a lot of people starting a business is just too big a risk but if you have taken the plunge you are obviously not one of those people so stick it out.

6. Learn the importance of equity.
I like to talk about equity because that is what you are building the value in if you choose to start a business. When you first start the equity you have is worth the market value of what you are going to put in to the company. If you are trying to sell it for more than that to an investor you need to convince them why and probably how you are going to increase the value of the equity on offer. You should hold the equity very precious if you don't care about your company no one else will but remember those who seek equity must do equity so give it wisely to people who can help your company grow.

7. Put an A4 sheet on your wall with your short term target.
You won't always need to literally do this but it helps. Writing down targets you must hit reminds you of their importance and by putting the date you need to do it by applies pressure you will need to hit them.

8. Keep growing every day and keep a long term view.
Drive your company using an inner scorecard, there are plenty of pressures around in the world, other companies paying higher wages, spending more on marketing and seemingly doing much better don't focus on that at all it's irrelevant. Focus on what is important to you and make that focus providing a great long term viable company that people love working for and you enjoy growing. Envy is the enemy, think of your company as a mission.

9. Remember hard work counts for a lot more than an idea.
I like to say even if you have a crap idea and you work hard on it you can make it a success. When we started Fubra our first product was selling .it domain names to UK companies. As it turned out in 2000 our potential customers only just realised they wanted a .com/.co.uk and .it names were really not selling well but we worked very, very hard and managed to gain enough customers to pay our expenses. This gave us a platform to grow further in to more profitable areas. Our next idea was selling software and was better because it brought in millions in sales.

10. Network up, research, research, research, and innovate.
Always try and connect with people above you in business that way you will learn from them, research all your competition and companies in general in depth. Some of the best web entrepreneurs I know are plugged into the internet they know literally everything that is going on they use this information and their connections to validate their own plans. Finally innovate! Make sure your product is different and adds value to the market place but is close enough to a working idea to give you confidence you are in the right market. Leave brand new markets and ideas to the competition once they have validated the space innovate quickly behind them but make sure you ski your own tracks and add value.

JPR, Yell and SEAT Pagine Gialle

2008-12-29T18:50:00.004Z

Watch out equity holders free cash flow won't be around much longer and your equity is going to be pretty much worthless by 2010 if you have any in these companies.

These are all classic examples of companies that are inherently strong businesses gearing up massively on debt which will prove hard to re-finance and not really having that great growth strategies or being able to develop any as they spend all their time looking in the rear view mirror.

I was talking to Paul yesterday about how we should offer to buy Thomson Directories from its Italian owners SEAT Pagine Gialle as a joke I'm not sure we could afford it right now but you never know. The £3.8bn of debt SEAT Pagine Gialle its parent has is crippling it and is sure to make good assets like TDL come onto the market at even lower fire-sale prices later in 2009 and if they don't I am so happy that all our main competitors in the local advertising space are basically at the mercy of the debt markets as well as without much of a clue about online strategy.

Listen to this quote from Tim Bowdler MD of JPR getting all angry about someone accusing him of ruining the business by gearing it up like LCD TV's are going out of fashion: "Most analysts in 2005 were saying we should take on more debt. It is very easy to sit on the sidelines and appear wise after the fact. Back in 2005 nobody was suggesting our strategy was flawed."

There are a lot of responsible business owners who didn't take the route you took Mr Bowdler but now like Yell with it's £5bn debt you and your fellow shareholders are going to be well and truly diluted as the free cash flow you thought would be there forever starts to decline sharply and the bankers come calling.

Please don't invest, just buy stuff instead!

2008-12-14T13:16:00.009Z

I have had a chance to have a good look this weekend at the Nesta proposal and watch the videos from the presentation and I thought I would make some comments on what I think about attacking the recession and how I think the UK might better equip itself to do so.

Firstly the concept of attacking a recession is a great one, there is both a real and present threat to the UK and more opportunities now for motivated people to really make a difference to their own futures and to the future of the UK as a whole as we enter this new recession. In general it is in my nature to strongly oppose government intervention like the banking bailouts, the pay greedy people's mortgages for a year because they overstretched plan and even the new £1bn investment in start-ups plan and there is a very simple clear reason for this opposition which is that the government, just like pension funds is an awful investor.

The sums of money they are dealing with and the long line of consultants waiting to help them deploy their lazy capital by working with start-ups confused by the red tape for a fee of course. Makes this £1bn investment a complete waste at worst and a very inefficient way of dealing with the problem at best.

So what is the answer then well I think it's all pretty simple but I am going to give you an example of how the government is monumentally failing in this area as I have been looking into it. The answer is that instead of thinking it can help it's people and attracting all the lazy give me some money non-value adding consultants it usually pays for advice. It should try and attract smart, motivated hard working people who just want to turn a profit and advance society. But how does it go about doing that?

Again it's pretty easy, smart motivated people want to get on in life, they don't like handouts and they work 10x as hard if they actually have to and want to at the same time. What they tend to like is equity in their businesses, and a feeling of making a difference for that they need customers not investment. What Nesta needs to realise is that with the greatest of respect pre-revenue businesses are nonsense and we shouldn't be investing in them as taxpayers because they don't make any money!!! Leave that to the experts! Just like we shouldn't be investing in banks who are pre-realisation that tier 1 capital ratios actually matter! Instead we should look to Silicon Valley. Silicon Valley was built on the US Army as a big initial customer paying for radio technology the US was fighting a war and at the end the big customer was gone but it didn't matter because lots of other customers had come along who wanted to buy the technology.

So all Nesta has to do is help government departments put money in the front door as revenue to companies instead of in the back door as investment. It especially needs to help the most inefficient arms of government buy from companies who show a commitment to re-investing profit in R&D. This simple change of thinking inside government will provide all the necessary stimulus to our economy that we need and make us world leaders.

What else can the government do? well potentially a lot more but here are some realistic suggestions that will help it get the UK where we need to be:

1. Reform and heavily promote Supply2.gov.uk put it at the heart of the revitalization strategy.

Supply2.gov.uk is a procurement portal for government to buy things from private companies in principle this is a great idea but there are some massive problems with it. Firstly it is so heavy on policy that when as an entrepreneur I went to tender for a contract with Portsmouth city council in our area of expertise we were not invited to tender even though we own our own data-centre, host and advise on some of the largest web sites in the UK and have loads of cash in the bank and employees to deliver the contract for the PCC we fell short by 100 points! This is not just us loosing in the tender process which might be understandable this is us not even being invited to tender despite completing a 16 page pre-qualification questionnaire about ourselves. I am not going to be that bothered if we don't get government work as a business because fortunately we don't need it. I did it as a test after reading the register article I link to above. But I was genuine I would have liked to have been considered and I did express an interest and what's more I think we could have done the job very well or at the very least made the council more aware of the costs involved which are probably exaggerated by incumbents who are just out to rip government off and know how to score more points in a badly defined tender process.

This is the second huge problem government is not a great investor but it is not a great buyer of services either, this comes partly from the fact there are so many competing interests and no strong leadership saying what is needed and will be bought but also from the fact that they is corruption and lazy but large private firms who have dealt with government before tend to get all the work from government rather than smaller more innovative firms who would love to work with government if it would only stop bean counting everything badly and let them tender for work!

Apart from this private firms have to pay to join supply2.gov.uk if they want more areas and this is crazy! If the government should do anything for free it is tell its people and companies openly and transparently what it wants. I also think the entire tender process should be fully transparent for maximum competition this means that as a company I have to publish at least the pricing and full description of services offered part of my tender so my competition can see it and try and undercut me on the contract and I can be held to account by other interested parties and tax payers at large who will ultimately be footing the bill for my services.

Then there needs to be a recognition that entrepreneurs don't mind filling in well thought out forms we just hate pointless ones that inexperienced procurement admins think up which comprise 80% tangental questions that don't have any bearing on if you can deliver the contact or not and yet comprise most of the point score! It's accountants who get their kicks from that kind of thing and that is because they get paid by the hour to fill it out! When did they last save the British economy?

So what can be done to achieve this? Well start by setting an example, there are lots of great small businesses who would love the chance to reform supply2.gov.uk. I think a more transparent community lead web site could be built in about 6 months by a team of very clever people for less than £250,000 and if they don't want to help government Fubra will and I am sure there are other companies equally if not more qualified for this who should post a comment on my blog to bid for the project perhaps the government could express and interest by leaving a comment and give us all an address to send our tenders to?

2. Pass legislation that specifically heavily discourages the third sector from entering into inefficient contracts.

Companies who are bidding will of course need to make a profit but often the key problems that keep smaller private businesses out of the running is that big deals are done with huge contractors for 3 and 5 year terms. These projects inevitably fail, overrun and generally cost much more because big companies are so inefficient. What we need is the government buyers having to apply a ratio just as data centres are starting to do with DCiE = (IT equipment power)/(total facility power). which will be the core metric for determining if a company is suitable more or less suitable for government work. Using accounting systems like Clearbooks this could be quickly inspected and I would propose that the metric should be:

GCEN (Government contract efficiency number)
=
Number of stakeholders above the average national wage inside the business, includes directors, shareholders, staff and contractors who are not working more than 80% of their time on qualifying R&D projects. Based on cash payments share based payments attract a fifty percent discount as long as shares are not allowed to be sold within 5 years of being awarded.

This simple number shows how many people in a company are being over paid vs its peers and has a leveling effect that does two things. One it means that if large companies want government work they have to reward their highly paid staff in equity not cash and invest heavily in qualifying R&D which creates a natural motivation for efficiency from within the businesses management. Two it means that small companies will right away have far lower and more attractive GCEN's than their larger counterparts and therefore as long as government legislates well to ensure all third sector work must heavily weight the GCEN as part of their assessment of a tender I would suggest it should be 50% of the points then this could be transformational for the way government buys things.

This means huge pay cuts for middle managers and people who add little value everywhere unless they can show their stuff and improve company efficiency no more lazy money.

3. Choose what the country needs to buy and start buying right away!

My business partner Paul wrote a post about Obama's new apollo project, although I am not sure how the investment will work and I would fundamentally oppose direct investment I have described above if the UK follows America and decides to spend more of the government budget on energy transformation then that is a scientific catalyst. What is needed is not just one large area like this but more of them where the government specifically commits to buying things which don't exist yet at the required efficiency IF and only IF private companies can deliver them to that standard.

I can tell you one thing I have learnt in business is that when the government says we are going to invest or buy things with no pre-condition nothing changes. But is is a very different matter if the government lays down the gauntlet to capitalists and scientists by saying, Solar energy is crap right now the cost per Watt is just too high but if you can produce it for £X/ Watt then we will buy it from you. Can you imagine the innovation that would drive? I am getting excited just thinking about it both as a challenge and an opportunity.

4. Reduce the welfare state

This is the hardest for a Labour government and completely clashes with their ideals but fundamentally welfare is a huge disincentive to innovation it is the curse of nationalised risk which should be on the shoulders of a countries people if it wants to progress not being passed on to harder working creditor nations as huge national deficits. The government needs to recognise people are like a bird who hasn't taken its first flight yet, they need pushing out of their comfort zone and for lots of the population who are not naturally excited or positive about life they actually need to need to innovate not just want to before they actually will. So cutting out or down benefits or even channeling them towards progress rather than living expenses would be a huge move forward for the UK. I am convinced if I was on benefits and they halved in cash terms but the other half was still there it's just it could only be spent on science, maths, IT lessons and equipment then as a nation we would begin to realise where the governments priorities lie and I have every faith that as a nation we will also start reacting to them positively.

5. Believe in open source, lightweight standards and collaboration. Patents and complex standards protect the lazy

There needs to be a realization that small companies are not going to be as good as large ones at business processes, health and safety, accounting and lots of other things but they are good at delivering the end product and far cheaper than their larger counterparts. But what has changed dramatically with the Internet is the ability for small companies to compete and Government has yet to wake up and realise that. Look at the tools they have now from new project management tools, to accounting tools to customer service tools, to hosting, all of these online tools are making it easier for companies who could never have afforded to before to compete with much larger ones for a few hundred pounds a month in costs. Technology has made things cheaper and more Government attention towards getting involved with open standards and policy setting which in theory it could be good at, if it realised that is its core role. This should mean that small companies have an even larger advantage.

In fact this is the economic dream that everyone can be self supporting because the tools are out their to help them achieve the things that they can't on their own and connect with others who can help them allowing them to specifically focus on adding the maximum value to society through their own unique or valuable specialist talents. It's getting closer but if we don't take this recession as a huge opportunity then other countries will beat the UK to it and we will end up stuck as a nation of shopkeepers or should I say buy to let landlords which is so much worse than the napoleonic accusation! We need to realise we are at economic war and if we loose we will be all be the poorer for it so Nesta got something very right we need to fight the recession!

As a final remark we need less egos in power, put doers in power not people who say things like we have made this progress and that bit of progress in an attempt to justify their own existence. We are not doing well we are doing terribly that is why we are in a mess and even if we were doing well telling everybody we are makes us all feel lazy. That's what's so great about recession fear is a very powerful motivator! So lets start acknowledging that we are not doing well, that risk does exist and that everything won't just be ok if we all freeze up and do nothing. Instead lets all actually start to choose to work harder and pull together as a country to get out of this mess.

I bought GOOG @ 252 today

2008-11-24T22:27:00.010Z

So I couldn't wait for 150$ I thought I had the discipline but it just seemed like too good a day to miss today. The whole market was rallying and Google was down over 3% again. I am not sure if there will be more forced selling pushing it down loads more but I still have half my money to invest if that is the case.

Why am I so keen to buy GOOG?

Well first let's look at its R&D spend. It's massive part of its expenditure as a percentage and I expect favorable tax treatment from the new Obama government as well as the UK government where Google conducts a lot of Mobile R&D. In fact all western governments will be pouring massive tax breaks on R&D as part of stimulus packages and Google will be a massive beneficiary.

Then let's compare its other selling expenses to it's main competition as a propotion of total expenses Google spends far less than Microsoft on general admin and selling expenses. This tells me two things, if Google can get 1 million new apps users in a year on the cloud before Microsoft even gets its cloud offering together and Google is only charging 25% of what the equivilent Microsoft product would cost. It doesn't take a rocket scientist to realise companies will switch to Google Apps in the recession in droves. And what's more they are already doing it without a big sales push from Google. Their products are so cheap compared to Microsoft equivilents (around 25% comparing like for like at enteprise level) it's a no brainer.

Microsoft has 60bn in revenues that Google hasn't tapped in to I think Google will successfully take half MSFT's customers in this down cycle who will pay Google 25% what they pay MSFT that is an extra 7.5bn of income and guess what I don't think Google will acutally need too many more servers to handle it. Further Google's fee is renewable annually whereas most IT departments refresh software every 2-3 years so that means Google in the long run could be getting nearly as much as MSFT was from the same customer but on a different cloud compute model.

Of course MSFT will try to catch up with Google on this point but the key is that MSFT sells a lot of what it sells because of the strength of VAR's and if MSFT goes to the cloud and tries to sell direct like Google then it will isolate that channel and erode margins on it's traditional business at the same time by putting huge downward presure on margins for VAR's with the presentation of cloud compute offerings on a utility model.

Google has big plans to be grow and an extra 7.5bn is a good start but really I would like to see net income at over 50bn so how will they get there?

I think they can do this through the seamless integration of all their products. With Microsoft I found out about new products when I sought them out. With Google I am stumbling on great new products every day. Take analytics which Google has created for webmasters to optimise their site, it's free but its driving huge value for webmasters using it. These webmasters are going on to then spend more on adwords as a result of having better web sites and earn more from ad sales with adsense as a result of optimising pages for advertisers and users. I expect Google to earn around 6.2bn from ads this year and for that to increase to 9bn next year.

So in short if Google gets agressive in 2009 even with a recession it could be looking at earnings north of 10bn and I think a lot of this will come from market share growth as users migrate to better products.

I have to say this is a pretty bullish case for adoption and I am an early adopter so I might not be the best at timing the general market reaction but I really love a lot of Google's products and I can only see them getting more of my companies money as time goes on so there is no reason not to expect this to be the case for all companies.

Google is also frugal but not afraid to make big investments in long term growth which really suits a downturn well.

Market, Sector, Stock.

2008-11-19T03:46:00.002Z

That's how it works with investing on fundamentals if you are investing in a bull market make sure all of them have a great story before you put your money in and if you are shorting in a bear market make sure they all have a terrible story.

It's served me well when I've followed it. But of course like most investors I relish the thought that I might some how be able to time things. I am sometimes wrong but often right and the more money I am betting with the more right I tend to be. So some my tiny readership might be interested I am nearly ready to buy a stock called Google with about 90% of my liquid net worth.

I don't expect either market recovery though or tech/ad sector recovery either though so this is a bit of a long term punt and so before I buy I am waiting very carefully but alert for my trigger signal. Lots of people have talked of capitulation day and I am waiting for just that day to buy when everything plunges on much larger volume than has been seen in the recent falls and it is obvious there is proper panic and value destruction.

I think we might see $150 if that day comes this year or early next but whatever the price when there is heavy selling of everything on large volume I'm buying and holding GOOG. I think it's like holding a global index but without as much inefficiency built in to the value.

I don't think that's even possible.

2008-11-19T03:40:00.002Z

Of course it is I said and then proceeded to explain just how it was possible. I got a skeptical look back that conveyed neither complete disagreement nor belief in my proposed solution.

It was a strange thing to hear an entrepreneur I think so much of say something like that. I wonder if this recession is really getting to people already.

Growing on Me

2008-08-01T22:13:00.003+01:00

After my first angel investment earlier in the year in Recommendations Ltd which launched RecommendBox and is now working on an exciting relaunch called Njoyed.com I have decided that I like investing in companies if I can help out with money and ideas.

I was recently approached by Ajay and Peter who are running a really exciting gardening web site called Grows on You and asked to invest in their company 4Rounds Ltd. What I love about their site is that it targets older people and I have always thought they are the people with all the money so why bother going after young people?

They are both pretty focused and seem to be building a great business so far even though it is still early days I have a feeling that they are both going to do very well from this venture.

The have an amazingly simple little tool that lets you pick a colour and shows you plants which are that colour. You can then get involved in the community and ask gardening questions as well as browse pictures.

But my favourite bit is what they are working on now which is a gardening shop. I was talking today about how especially with garden machinery they have a great opportunity to fill the gap left by the spread of B&Q'esque stores which have flattened small garden shops and left consumers wondering where to turn for advice on what are pretty significant product purchases like lawnmowers.

I love this recession already and it hasn't even started

2008-08-01T21:46:00.003+01:00

I was just remarking today how pleased I am we are entering a recession. A lot of entrepreneurs I know have been preying for a downturn for a few years now which might seem a bit perverse because surely it will surely hurt a lot of businesses.

But I usually hang around with people who run ultra low leveraged businesses like ours and the downturn seems like one massive opportunity to pick up lots of valuable assets on the cheap.

I have only been running our business for 8 years now though so I haven't been through a proper bust and I am finding myself frantically searching for more opportunities which can only be a good thing. I think the best businesses will ride the cycle and I hope all the hard work we have been doing investing back in our company means we are set to prosper from it.

For now at Fubra we are working on a platform to allow us to integrate other web sites into a common development framework whether we buy them or build them. We have our login component sorted (Fubra Passport) and we are just about to launch the payments component (Fubra Payments) work is also nearly finished on the underlying hosting infrastructure although we are having a few issues with our storage lately we need to iron out.

I think one area for growth is debt counseling and online budgeting, Paul was telling me only yesterday how he is spending a lot of his time getting his family and friends on budgets and I think their is a big demand for some kind of personal finance tool to help people manage their money and budget better in a downturn. To this end Fubra has just invested in an exciting accounting start-up for small businesses that we think can also address this need called Clear Books

Then we have HousePriceCrash.co.uk which is going from strength to strength at the moment and PetrolPrices.com whose growth is also phenomenal. Another area is voucher codes that Duncan is looking at which I think will have big growth.

I'd love to hear your ideas of areas you think will have good prospects in a downturn if you are reading my blog.

What a day!

2008-07-29T23:35:00.002+01:00

We have had a very long day indeed today at Fubra well some of us anyway (I sent most people home). It all started early when we were in to let the electrical contractors in and the electricity board cut the power to half of Aldershot so that they could wire up my latest crazy plan to build a data centre ourselves.

We've had major works going on for the past few weeks and things are coming on well. So much so I am hoping that we will take delivery of our new air conditioners from China tomorrow and start to put the finishing touches to our latest project like, sound proofing, security and fire suppression systems.

Early in the morning just as we were finishing preparations the electricity company ahead of schedule brought the power down. This was when the problems started, we had a failed array as a result of an unclean shutdown that spent half the day fscking before we decided to just start again and restore from backup after finding it was pretty much beyond repair. As if this wasn't enough we had to migrate all the servers to a new rack in our data room and what is proving to be a very temperamental storage array at the bunker decided to lock up on us right when we had no power or internet at the office to try and fix it.

Anyway it's all done now and I am getting pretty excited about wrapping this project up over the next month.

70k cheap?

2008-06-03T23:01:00.002+01:00

Martin Lewis writes in his Petrol Saving article about our site PetrolPrices.com:

As it requires registration, it’s collecting a huge database of customers which it can use to develop other services and referral systems to capitalise on. It already has links to car and home insurers on other bits of the site. Unconfirmed industry rumours suggest it originally paid £70,000 for a year’s data. Website technology is cheap to implement, so this is a cost-effective way of building a popular consumer service website.

I don't think it's particularly cheap but Martin is right when he says it's cost effective. When we started the site, like with OurProperty.co.uk before it, we had started to pioneer a new business model that is known at Fubra as "FREE"

Our idea wasn't that simple in fact it seems to perverse to most commercial people I speak to. So for the past few years I have had to put up with being mocked as those around me pretty much thought we were insane. But there was method to our madness.

In fact it turns out you can build up a fairly strong brand if you spend money on helping consumers in a cost effective manner as I am sure Martin knows only too well.

We have a few exciting plans for commercialisation of PetrolPrices.com nearly ready to be implemented and the great news is that I think they should take the site from a loss making one to a solidly profitable one allowing us to keep helping consumers save money on fuel for ever. What's more our plan should mean that the site becomes even more useful as an everyday tool and helps existing and new users save even more money on fuel as a result of an exciting piece of technology we are developing.

Faithless

2008-06-03T22:58:00.002+01:00

I find it can really help if you want to work harder than you have ever worked before if you have a good track of loud music playing in your ears.

One of my favourites is Salva Mea by Faithless.

The UK Libertarian Party Manifesto

2008-05-31T11:02:00.002+01:00

I'm very glad I found and joined the UK Libertarian party and I am impressed with the majority of their manifesto.

I hope if you read my blog you will check it out. The reason I like them so much apart from them aligning with my political views is that they are a breath of fresh air in an environment where politicians just tow the party line and rarely propose any radical changes that might bring a lasting benefit to the population.

This is a hugely radical manifesto and I will be the first to admit I am not sure it will all work out 100% in fact in the short term there would likely be huge resistance to the changes proposed as people fear what they might mean. But in the long term the ideas are sound and should produce a more productive population who lead more worthwhile and free lives instead of a population working for the state in one way or another that we have now.

If you have ever talked to a local politician about policies which I have it's interesting to note just how unimportant there are to them. Politics has become about cheap point scoring based on weak argument. It would really take putting a party like the Libertarian party in control to ignite interest in politics again and engage the population. I know I am so refreshed already to find a group that actually has some interesting policy proposals.

I wonder though just how popular the party will become given the radical nature of their views please do leave your comments about them.

Cheap travel insurance

2008-05-11T10:57:00.004+01:00

I am really pleased with all the hard work everyone at Fubra has put in to launching our updated travel insurance guide lately. We have had a long time where a lot of the projects we have been working on haven't been quite ready to promote to lots of people and in a way travel insurance guide still has a lot of ways it can improve but for the most part it's a great start and I feel it's ready to shout about.

The front page has been updated to include a quote form that allows you to quickly compare the 47 travel insurance companies that we have conducted extensive research on and find the best deal. So next time I am renewing I know I can be confident that I will be able to use our site to find the best travel insurance deal.

Now that I have figured our how to do screen grabs on my macbook I am addicted so I will leave you with a quick Command + Shift + 4 of the front page quote form:

Why fund managers are too stupid to manage my money

2008-05-11T10:27:00.011+01:00

I was browsing the times web site today and I noticed an advert for First State Global Resources Fund.

As with all these adverts it claimed that Real specialists know how to look for opportunities. That's all very well and good but real specialists know a bit more than just how to look for opportunities. Real specialists know a bit about the sector they operate in:

But the difference between these fund managers who claim to be Real specialists and investors who actually are is that Real specialists also know that whatever 5.1 trillion is as a number, and it could, to be fair, be two things it is certainly not 5.1 billion!

So if you are looking for somewhere to invest and you want a fund who don't have a basic handle on large numbers then this one could be your best bet:

Moats and Drawbridges

2008-05-02T00:37:00.002+01:00

I was thinking today about something I heard Warren Buffet say once when he was talking about his investment in Coca-cola. He owns around 7% of the Coca-Cola corporation and one of the main things he said he looked for in an investment was a moat.

Building a line of defence around a company is the key to creating true value inside the business because without defences from outside companies and people who, in general, want to take as much of your business's money as possible can drain your business quickly. But Buffet meant he looked for a moat to keep out the competition not a moat to lock in value. I think moats do both things and for a fledgling business both are equally important.

In my business life so far there have been a few moats we have used to keep out the competition and some moats I have seen other businesses use as well for the same purpose. I thought it would be good to recap on them in order because I think your moat naturally deepens and widens as your company grows until one day you realise you need a drawbridge. For me the sign of a successful company is a suitably qualified drawbridge operator which I will come on to in another post.

Secrecy with a shovel
The first moat we built in our business was a weak one and like most businesses we dug it because we were terrified of losing everything. It came about as we started to hire people. We were a young company and we thought that everyone who worked for us would inevitably want to start their own business.

Of course to any entrepreneurs this makes perfect sense, why work for someone else if you can go it alone? So the moat we were digging in this instance was a moat around our business that helped us keep everything we did a secret. We thought that if our staff and our competition were unaware of how much money we were making it would help us protect ourselves from them getting the overwhelming desire to build their own company and prevent our competition from copying our business models.

At an early stage in a business perhaps this is exactly the type of moat you need and would explain why so many start-ups are keen on NDA's and some I know shroud themselves in a cloak of total secrecy. This is especially prevalent in the SEO world or anywhere a kin to this like consultancy where knowledge is the asset being traded and the businesses concerned feel especially weak.

Secrecy is all very well but it is quite stressful. My theory is that if a business gets past the secrecy stage complexity takes over the secrecy part of the moat and the business goes from trying to protect it's vital assets to not needing to bother as they are much more difficult to figure out in the first place.

Step two, Search engines
The second moat we dug around our business was a function of our knowledge. We became particularly good at understanding search engines and used this knowledge to build a number of top search engine positions which helped us derive a healthy income.

Search is such a huge business this moat served us well much longer than our secrecy moat had done but we always realised that this moat was filled with water and anyone with a search engines permission could use the moat to take out businesses market share. We would never be able to fully control our search engine listings and I had always been fascinated by huge corporations and how they managed to grow so big because it didn't seem they did too well in Google. Apart from referrals from contextually relevant web sites search engines seemed to be the biggest sales driver for our company early on but there was a limit to the number of top spots you could occupy to grow your revenue.

Technology a barrier to entry?
The next moat we decided was important to dig was a technical one. We were a software company after all and we could code good software so if we coded stuff that took us a long time it was a fair assumption that it would take others and equally long time to copy us and compete.

We started to build a platform to help us deploy web sites and features more quickly across a huge number of sites. These technical steps were often an invisible moat. If you have ever wondered why Youtube grew so large you will realise that it wasn't the first video web site to offer the model in fact there were quite a few before it. Instead one of its key strengths was the technology they hacked together and developed that allowed them to serve the huge pent up demand for video sharing that existed. Very few other companies had the technical know-how or finance to support that kind of growth. Yet to the outside world it seems simple to put a video on a web site.

Of course technology is a great moat but it can only go so deep. There are a lot of hugely talented technical people out there ready to apply themselves to successful ideas and if your one isn't secret and you are not top of the search engines you may well find all the moats you have built up to now offered you little protection.

Branding, perhaps marketing isn't all fluff.
Instead I think that the only moat deep enough in many instances to give a company pause for thought when it comes to deciding if they now need a drawbridge is branding.

Branding is the single biggest value creator in a businesses tool kit. A business with a leading brand in a particular sector is almost untouchable as long as it continues to execute on a strategy to protect that brand it will lead a market forever despite the best efforts of even very powerful competitors to thwart it.

That's a pretty big statement to make and it comes from the mouth of a technologist who up until a few years ago thought all branding and marketing consultants were a complete and utter waste of space. I have to say that belief is still relatively intact given the fact most of them don't really understand what it takes to build a leading brand. Most of them are called in at a later stage to advise after the heavy lifting has been done. Nevertheless anyone with a Hitwise subscription and an obsession with data will quickly notice if they didn't already know just how much value a strong brand can deliver.

Nowadays I will always thing before we embark on an idea can this idea be a leading brand in the sector we are entering into, whereas before I just asked myself can I get this domain to number one on Google.

So what of a drawbridge?
Well assuming you have been lucky enough to build a successful company you will have had to let some people into your company to help you and you will have probably partnered with some other companies. You will almost certainly have had to let these people cross your moat hopefully via a drawbridge someone controlled.

In another post I will cover the role of a suitably qualified drawbridge operator because I think that is one of the key's to becoming a truly successful business.

San Francisco here I come...

2008-04-19T16:31:00.002+01:00

I am putting 3 new destinations on my places visited in America list over the next few weeks and number 2 is San Francisco where I will be staying tonight and for the next 10 days.

It's a four and a half hour flight from Chicago (ORD) to San Francisco (SFO) so I'm not looking forward to that too much but the rest of the trip should be very interesting. What I think is most interesting looking at San Francisco is just how small the web world actually is.

I remember when I first read Paul Graham's take on why Silicon Valley is the place to be I thought it was non-sense and you could build a successful start-up company anywhere but I am already starting to see why if you locate in Silicon Valley it can really improve your chances especially if you are a business that takes venture capital.

I am trying to figure out if there is one huge bubble in the Internet sector right now. At the moment I think we are about to enter the huge wave of greed to drive everything to insane levels before it all collapses. I don't think markets can ever escape cycles and what I am interested to learn is can there be a huge 2 year boom in the internet sector whilst credit is tightening and easy money is drying up elsewhere.

I am looking forward to learning a lot from some of the people on the front line in California over the next week.

That's more like it!

2008-04-18T15:55:00.002+01:00

I was pleased to wake up today to a 17% jump in GOOG after my correct (for once) prediction on the price.

If anyone has any money I suggest you buy some more Google shares right now this could be quite a steep accent from here.

Not all Hiltons are the same

2008-04-18T15:36:00.002+01:00

I have stayed in two Hilton hotels in my life. The first was The Waldorf Towers in New York and I am currently staying in the second the Hilton at Chicago O'Hare Airport.

The Waldorf was amazing in every conceivable way in fact I would go so far as to say it's my favorite hotel in the world and I will definitely re-visit. But the O'Hare is horribly standard.

I do have a great view of the airport which is surprisingly cool but I am sure dear reader you know what I mean when you get off on the wrong foot with a hotel. It all started for me when I realised the wifi wasn't free. It's a small thing but when you pay a premium price you expect things like that and in fact the next hotel I am staying at whose prices are considerably lower does in fact include it.

I am probably just nit picking it is an airport hotel after all so I am not sure why I expected much.

I have to say I am glad to see Conrad Hilton's Be My Guest takes pride of place next to the Holy Bible in the bedside draw at least they managed to keep some consistency and make me laugh.

It's good being in Chicago though and I am looking forward to a meeting I am having later today with Ron from Ticket.TV.

Google gets deeper and wider in one week

2008-04-12T10:04:00.003+01:00

This week has been a week where Google has made two significant new announcements. The first was the launch of Google App Engine which will allow web application developers to use the scalable Google infrastructure platform to build web applications. The second was the announcement that Google's crawling team are now filling out HTML forms to crawl deeper parts of the web.

At Fubra we have been building technology that crawls the deep web for quite some time now and we are about to launch some new services as a result of that work which we hope will be popular. We have also spent a long time building a platform to scale the web applications that we build easily and allow other companies to do the same.

I don't feel at the moment that Google's announcements put them in direct competition with what we are trying to achieve as a business because our approaches are slightly different. Google is trying as usual to create a one size fits all infinitely scalable solution to a problem that most people have difficulty comprehending and we are going for the slightly less ambitious route of concentrating vertical by vertical and trying to add value in each area.

But these moves gave me pause for thought. It's a glimpse into the 100 year plan which I had suspected would be a direction Google would take. Google wants to be the ultimate middleman and I think at this juncture it needs to consider the impact this will have on the G-economy. I want to look at the past to recap where we are at now and then think about what this could mean for the future.

The first thing Google tackled was thin affiliation. These were web sites that essentially re-presented paid search result feeds and who's sole goal was to appear in the Google natural results. Having been involved in the creation of some of these sites in 2001 I recognised the limited value they had but they did have some small value because they helped smooth the listings where Google had bad results anyway they provided another result to help users navigate. Google gradually improved its results further and these sites were an unnecessary pest but the businesses running them were often creative and evolved to cloak the fact they were simple affiliates using technologies like XML integration with partners or taking a different route and upping their game to provide the next level of value.

We participated in this step too realising that Google ultimately wanted results which would provide better value we built some of the first vertical comparison search sites initally we started with one for airport parking and quickly moved on to one for car hire. On all the sites we built them to provide extra value for consumers and they do just that. Interestingly though it was in 2004 that I started to become worried that despite us providing extra value Google would ultimately look to eliminate vertical search web sites and link directly to service providers themselves by building what they later dubbed universal search. I am glad I thought this and it has taken them 4 years to actually start coming out with decent in roads into the plan because it gives me a little confidence I have an idea where they might be heading over the next 4 years.

So in 2005 our business evolved again to license data and create original content that was not simply re-ordered content from a number of other web sites but content we owned and which Google would have no choice but to link to. This turned us from thin affiliates, to value added affiliates to media owners. At the same time we also decided to build our own platform which we would be able to sell to help other companies with the same task.

Taking these steps has ultimately saved our business and going forward I have a plan to compete with Google's one box universal search by lots of one box vertical searches which I think ultimately will be a lasting strategy given the difficulties I think Google will now begin to face. Where I think there will run into trouble now and in the future is in two areas.

Firstly they have a product line extension issue that they may fail to address. The first thing which comes to mind when people say Google is search. So the technology side of the business whilst it is very important to Google probably needs a new brand if it is going to be as successful as Google wants it to be. After all the same company that helps me find stuff isn't the same company in my head that helps me build stuff. Gmail I thought was pushing it a bit too far but ultimately they have turned that into a fairly successful line extension by searching email well and thus giving people the Google searches mail well too connection in their heads. But Google App Engine is too big a product for the Google brand and if they start to blend the platform and search side of the businesses more I think they will start to hurt their business and brand overall.

Secondly they have an economy of millions of small web sites relying on them and as you can see from Fubra's beginnings if you manage to get a foothold and carve out small bits of value then ultimately you can use that to try and grow into something that offers more value which is what Google really wants. But with Google coming in and playing around by trying to do vertical search itself and hosting as well they need to realise that these areas are currently the bread and butter for a lot of the next generation of content creators who are likely to be in the early stages of their development. If Google does manage to do both these things successfully it could start to have a very damaging effect on new start-ups and innovation in the internet and media sectors and ultimately leave Google with less content to spider and a worse search experience.

I think that there will be some very interesting further developments lying ahead and I continue to be excited about them.

RecommendBox

2008-04-09T17:51:00.006+01:00

I am quite excited this week to get involved with a new social networking start-up called Recommendations Ltd that are trying to attack a problem which I think is as yet unaddressed.

The business plan is simple: To facilitate the sharing of great recommendations between friends. Of course the key will be in the execution and it's a lofty goal with email, word of mouth and phones as key competitors in the space.

I think this is why a lot of people I have talked about the business to have been initally critical of the service, which is still in its infancy. But this is is a business that will either go big or go home so it's bound to be a bit misunderstood early on. What I think is very positive is the feedback they have given so far though and how quickly Robert and Scott the founders are acting on it. People like responsive start-ups and I think the road map they have will help them build a business that gets traction and grows fast as well as becoming profitable very quickly.

Funnily enough compared to investing in commodities on leverage an internet start-up seems a bit sedate. But I guess since we are going into a credit crunch you need to get a bit conservative with investment stratergies so I thought I would stick to what I know best.

My Google timing must be improving

2008-03-11T19:29:00.002Z

I am notorious for losing my shirt on Google share bets at results time in fact I have lost so much money on Google I feel a bit ill when I think about it. I am so contrairan I have gone long on every results day where their shares have taken a beating following results and only once when they have risen!

This time I think I might have got my timing a bit better I have just picked up some Google shares this morning at 430 and Viacom have just lost their suit as well as the good news about the DoubleClick acqusition so I think today is the reversal day. Or the markets could crash and take the stock down with them.

I have bought them in my ISA so I am planning on just holidng them now until Google is worth more than Microsoft because guessing what stupid investors are going to do following results is bad for my health and I think GOOG is the new BRK.A at this point.

Natural Gas is where it's at!

2008-03-11T11:11:00.003Z

If anyone wants to know one of the best commodities in the world it's natural gas. I find it ironic that there used to be a time when it was cheaper to burn it than to sell it because of government intervention in the US.

This is so crazy we should protect our natural resources not plunder them! From an investment perspective what makes it one of the best investments in the world for the next six months and one that has been a top performer for me in the past six is the simple fact that in terms of BTU output natural gas is hugely undervalued against oil. Energy should be equal in BTU per dollar cost in my view so I am continuing to invest in natural gas whilst oil approches my 200 dollar prediction.

It has just broken through 10 dollars after a huge move and I don't think it will be too long till it hits 20! Hopefully this will be short lived but there is something that is making me very worried for the economy and a little excited I don't have my savings in pounds at the same time. I feel like some kind of superspike will happen across the board in commodities perhaps when Gold breaks 1000 USD.

I was talking to the papers yesterday about the £1.50 prediction for petrol and it feels closer than ever now. I have started driving less and taking the lead out of my right foot as well so things are pretty bad. The story is the same in the office people doing 55mph even though they hate it and a range of gentle breaking techniques making lunchtime conversation. For what it's worth I think that any super spike will have an immediate impact on demand which will bring it all crashing down shortly after but not below 100$ so £1 a litre I think is unfortunately here to stay.