NZ Entrepreneur Magazine - Issue 10

NEW ZEALAND’S E-MAG FOR ENTREPRENEURS AND BUSINESS OWNERS

August 2013

Going Global Entering the US market

Business Lessons How to sell more!

10 Questions with

Rod Drury of Xero

Profile on #nzentrepreneurs Lee Bennett & Steven Almond Silicon Valley - The Kiwi Landing Pad

case study: stray

“I’ve forgotten about reliability issues because there are none.”

Brett Hudson Operations Manager, Stray

Stray

Stray Limited is an adventure bus company taking travellers to out-ofthe-way places around New Zealand. We caught up with Operations Manager, Brett Hudson to talk about 2degrees and their business.

Adventure Travel 50 staff 41 mobiles Around NZ Joined 2012

Why does stray need mobiles?

Our tagline is “off the beaten track” so we’re not staying at your main destinations. We’re getting out there to the extremities of New Zealand and our sole way of being in contact with our drivers is through phone communications. We have changes happening all the time and we need to be able to contact our team in real-time.

What Was your old provider like?

There were large phone bills and if we had a problem like a phone outage it seemed they were either busy or they weren’t organised, and couldn’t get back to us. It was very frustrating and it became a constant problem within the business.

and What impact is 2degrees having?

It saved us $60,000 in the first year. In the second year, it’s going to save us that again. All this will go back into marketing campaigns or growing other parts of the business. The other impact is having an Account Manager I can get hold of to get solutions to my problems when I need them.

What difference do mobile devices make?

Our drivers are now able to use their smartphones and other mobile devices to show videos, photos and information about other tour packages and options available, like our operations in Thailand, Laos, Cambodia and Vietnam. We couldn’t do that before and it has made a huge difference. Of course, they’ve now got email and internet access too.

“You need damn good partners for successful business, and 2degrees I put in that category.“ Brett Hudson, Operations Manager

hoW is the coverage?

The coverage is fantastic. Regularly, I’m on road trips across New Zealand and off the beaten track and haven’t experienced issues with coverage. With our old provider there were a lot of black spots around Auckland and I don’t get those with 2degrees. And the bus drivers could be at Cape Reinga, they could be at Stewart Island, they could be down the West Coast; so in all sorts of different coverage areas and 2degrees works well for us.

3 x $89 plan

37 x $49 plan

1 x $149 plan

hoW reliable is the netWork?

Since I’ve been with 2degrees I’ve forgotten about reliability issues because there are none. Previously I regularly had issues.

I would be on the internet and it would drop out and when I sampled a 2degrees SIM card in there, I was amazed at the speed, how much quicker it was. I would regularly be on the phone with the last network and it would just drop a call. I don’t get that any more. As I said, the word reliability has disappeared from my vocabulary because it is so reliable.

For video case studies about Stray and other businesses who have made the move to 2degrees Business, please visit 2degreesmobile.co.nz/business

better 0800 022 BIZ (249)

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2degreesmobile.co.nz

businesscare@2degreesmobile.co.nz

BUSINESS

Contents 4

From the Editor

6

Going Global

10

Kiwi Landing Pad

12

10 Questions With Rod Drury From Xero

16

How To Sell More

18

Profile: The Makerspace

22

Profile: Blender Design

24

Tomorrow’s Entrepreneurs

26

IP In Action: Watch Your Words

28

Entrepreneurial Intelligence With Sandy Geyer

30 The Paddock 32

Parting Shot

Subscribe to NZ Entrepreneur for free!

ABOUT / Short and sharp, New Zealand Entrepreneur is a free e-magazine delivering thought provoking and enlightening articles, industry news and information to forward-thinking entrepreneurs.

EDITOR / Nick Harley ART DIRECTOR / Jodi Olsson GROUP EDITOR / Nick Harley CHIEF FINANCIAL OFFICER / Alastair Noble CONTENT ENQUIRIES / Phone Nick Harley on (021) 052 9770 or email nick@nzentrepreneur.co.nz ADVERTISING ENQUIRIES / Phone Jennifer Liew on (027) 4398 100 or email jenniferl@espiremedia.com

From the Editor

A

ADDRESS / NZ Entrepreneur, C/- Espire Media, PO Box 99758, Newmarket, Auckland 1151, NZ WEBSITE / www.nzentrepreneur.co.nz

ISSN 2253-5683

s you know, New Zealand is slightly isolated geographically from the rest of the world, making travel more expensive and a bigger problem for Kiwi busi-

nesses looking to scale.

Sometimes it can also stop small businesses from wanting to expand, meaning that many create businesses solely for the New Zealand market and focus their efforts locally when they could be doing it on a bigger scale. This isn’t necessarily a bad thing, some companies are able to grow sufficiently within New Zealand borders, there’s nothing wrong with that, but the population is small in New Zealand and naturally, so is your potential market.

With a few small changes, could you adapt your business to serve people in other, foreign markets? Could you be doing what you’re doing on a bigger scale?

This issue of NZ Entrepreneur looks at a few Kiwi businesses that have built their companies with global ambitions and features the support systems they used to do it. What can we learn from them?

Entering foreign markets takes time, planning, capital and guts but historically there has never been a better and easier time to do it.

Nick

Email nick@nzentrepreneur.co.nz LinkedIn http://nz.linkedin.com/in/nickharleynz

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NZ Entrepreneur is a GREEN MAG created and distributed without the use of paper so it’s environmentally friendly. Please think before you print.

Thank you!

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ENTREPRENEURSHIP

Going Global Successfully Entering Overseas Markets As one of the biggest and most lucrative markets on the planet, the United States offers both opportunities and challenges for businesses trying to make their mark. Mako Networks is one Kiwi born company looking to take on the world, we talk to founder Simon Gamble about the journey so far and what he has learned along the way.

By Nick Harley

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The be board have alr and d you a t

Left to right: Bill Farmer, Chris Massam and Simon Gamble

Tell us about Mako Networks? How did you come up with the idea and what’s the story behind the business?

locations and manually setting up each connection. We wanted

Mako got started in 2000, after Chris Massam and I met working at Telecom Xtra. This was back when broadband Internet was first starting to catch on for businesses in New Zealand, and there were relatively few connections in the country. But quite early on, we were able to see that businesses needed help securing their computer networks and setting up a good firewall.

Then in 2003, two important things happened.

Chris and I thought there was an opportunity to manage the Internet connection at these businesses as a service and started out on our own as YellowTuna Networks. We would go out to businesses, build and manually configure Linux-based firewalls so that they could make use of the greater speeds broadband afforded while still maintaining the integrity of their network.

Things were great, at first.

We quickly found out that the business model we had simply wasn’t scalable. The better we did and more customers we took on, the more time we’d spend driving between customer

to continue to grow the business, but were a little bit stuck on the ‘how’.

First, Dennis Monks joined the company. Dennis is an exceptional technical mind and developed a patented technology that would allow our networking equipment to be managed centrally from the cloud. That way, when a new unit gets plugged in somewhere, it can automatically download all its configuration data from a central location, without us ever having to go out and configure it. Once we had the cloud technology in place, our system was almost infinitely scalable.

The second major event was having Bill Farmer, a serial entrepreneur, become our CEO. I had come to know Bill through motor racing and asked him if he could help us. Bill has vision, passion and a wealth of business knowledge, his experience and leadership have proven invaluable as the company has grown.

And that’s how the Mako Networks we know today got it’s start.

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There is no substitute for getting time in front of the people you want to sell to.

SECTION

How did you know it was the right time to start exploring foreign markets?

It wasn’t long after we started producing our own firewall appliances that we started looking for ways to take the business international. We were aware from the beginning that the market for a technology solution like ours was much larger than New Zealand, and we wanted to tap into that market opportunity to help grow Mako.

Plus Bill had a wealth of global business experience and was able to help us navigate some of the early issues when trying to internationalise the business.

Our first offshore business took place in the UK in 2005, and we soon expanded to the Middle East and even South Africa.

The company has continued to grow and is now also doing business in Asia and is putting a lot of effort on opportunities in the United States.

How did you approach your entry into the US? Did you just hop on the plane or did you have things already in place?

We had been researching our entry into North America for a number of years—attending trade shows, visiting prospective partners and customers, and participating in payment industry conferences. By the end of 2011, I was up in the US every six weeks. The amount of business for us to do was staggering and we decided to open up our first US office as a result of all the background work we had done. We found it’s important to have a physical operation in place, as people want to do business with a ‘real’ company, not a virtual one.

So we went through the process of an executive transfer visa to move me up to the US on a more permanent basis. As we explored that process further, we discovered the challenges of the US immigration process.

For example, part of the requirements were that we needed to maintain a place of business in the US during the visa application process, but weren’t allowed to actually conduct any business there during this time. It took a full six months to get a visa to live and work in the US, and during this time I continued to travel there regularly.

We needed to find an office solution that was flexible, affordable, and would help us to meet immigration requirements. Which is how we found the Kiwi Landing Pad in San Francisco.

Once in-country, that’s when our growth opportunities really took off.

An original co-founder of Mako Networks, Simon manages Mako’s North American operations from San Francisco

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Do you think more Kiwi businesses should aim to go global?

Going international isn’t for everyone or every business. But for those that are serious about growing their company and revenue, the potential of the US is difficult to ignore. Most entrepreneurs and business owners are already working pretty hard in New Zealand to win customers and build their ideas. But you can work just as hard in America and the payoffs are exponentially greater. We’ve seen our US sales pipeline grow tenfold in the last 12 months.

What challenges have you faced when trying to become known in such a large market?

Coming into a relatively established technology market as an outsider is certainly a challenge. We’re a network management and security provider, which means that customers are entrusting us with their most sensitive data. And to come in as an outsider from a place most US companies have only heard about, you have to work very hard to establish trust and confidence in your solution.

As an example, we recently secured a large contract here in the US with a major corporate company with thousands of locations. But after the selection committee had picked our solution, there was another review by a separate decision review board, which asked us to complete a stress test to demonstrate that a company like ours that came from overseas could adequately service their company. Fortunately our solution was up to the task, but it goes to show that you do need to prove yourself here to a certain degree.

The Mako System has some important industry certifications that have also helped reinforce our credibility with prospective partners and customers. A key differentiator for Mako is our Payment Card Industry Data Security Standard (PCI DSS) certification, which no other network management company has. That certification serves as a third-party validation, and gets us a seat at the table for a lot of business opportunities.

Is it expensive to explore a foreign market or could you do it cheaply? What do Kiwi businesses need in order to be successful when expanding overseas?

There are relatively inexpensive means of exploring a foreign market to decide if it’s right for your business. We have found New Zealand Trade and Enterprise to be an fantastic resource for information and contacts for different markets; we had great help from NZTE when we were evaluating Southeast Asia to help us understand the market opportunity of each country and to help facilitate introductions to potential partners.

You’ve got to be prepared to do a lot of travel and spend a lot of time away from family and friends to really decide if a foreign market is right for your business.

What three pieces of advice would you give to anyone looking to break into the US in particular, or any foreign market?

Establish a base of operations near your potential customers.

There’s no substitute for getting time in front of the people you want to sell to.

Be patient. The US immigration process is long and difficult, and it would certainly pay to have some professional counsel along the way to help things go smoothly.

Jump with both feet. Show that you are serious about planting your flag and integrating into the country.

How did you get involved with the Kiwi Landing Pad and how have they helped you?

We came across the Kiwi Landing Pad in mid 2011 when we were researching the various requirements for immigration and were evaluating potential US office locations. We had a good idea that we wanted to be based in the San Francisco Bay Area; for tech companies, there’s no better place to be.

But finding something that met our needs was proving a challenge. With the KLP, we were able to walk right into an environment designed to help foster our growth and establish an in-market presence.

The KLP has a philosophy that you should never make a cold-call while you’re here; there’s always someone that knows someone and can help facilitate an introduction. That’s certainly been my experience. We’ve been able to meet some excellent partners, prospects and all-around interesting people through the KLP directors and tenants.

For more information about Mako NetworksEmail: info@makonetworks.com Phone: +64 9 448 1340 Web: www.MakoNetworks.com Twitter: @MakoNetworks Facebook: www.facebook.com/MakoNetworks Delicious: www.delicious.com/MakoNetworks

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E cos y ste m

Kiwi Landing Pad S

upported by prominent New Zealand technology investors as well as the New Zealand Ministry of Business, Innovation and Employment, Kiwi Landing Pad can offer New Zealand technology companies either short or long-term residence at their office in San Francisco. Tenants gain access to a wealth of experience and are able to create invalu-

able networks in the US technology, business and investment community. Kiwi Landing Pad was established in 2011 to help selected high growth New Zealand technology companies establish and grow their business in the USA.

What kind of services do you offer to NZ businesses at the Kiwi Landing Pad? Kiwi Landing Pad (KLP) was established as a non profit in 2011 by leading New Zealand technology entrepreneurs. KLP provides a landing point for an increasing number of Kiwi technology businesses wanting to expand into the US. Being a resident at KLP means reducing a lot of the risks and time taken around initial office setup. The real value for companies is being able to help accelerate their business development plans through the knowledge, networks and curated community that has been built around KLP. How do Kiwi businesses get involved with Kiwi Landing Pad and what requirements do they need to meet?

Setting up business in the US is expensive and time consuming - we work with technology companies that have the resources and commitment of key people to focus on the market intensely, which makes them credible and viable in the local environment which is very, very competitive.

Anyone who is not prepared to do that is not a target for KLP as ultimately it affects the credibility of our sponsors and community which is a extremely valuable asset in the business culture of the USA.

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Kiwi Landing Pad offers many services to help Kiwi businesses

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Entrepreneurs offer their advice at a Kiwi Landing Pad event

Residents relax in the ecentre kitchen

Who’s behind the Kiwi Landing Pad? Catherine Robinson - Director, San Francisco Catherine is a specialist in communications and marketing for technology business with particular focus on brand creation, media relations, shareholder communications and internet marketing strategies for early stage technology companies.

Catherine relocated to San Francisco following the acquisition of Aptimize by NASDAQ listed Riverbed Technology in July 2011. Prior to this she was a founding team member of ActionThis, an online project management software start up and Xero an online accounting software company.

Catherine joined the Kiwi Landing Pad as it’s Director based in San Francisco in September 2012, and brings her extensive experience in commercialising technology and strategies for entering the United States market.

John Holt - Managing Director, Wellington John is a serial entrepreneur passionate about Technology, Innovation and New Zealand. Based in Wellington New Zealand, John has worked as a senior executive in multinational corporations Xerox, HP, IBM and ANZ Banking Group and now focuses on internet based technologies and commercialisation opportunities.

In 2006 he co founded Sonar6 an HR Technology company which he was CEO and Director of until 2012 when the company was acquired by NASDAQ listed company Cornerstone on Demand.

John acts an advisor and part time executive for a number of tech companies in New Zealand and San Francisco and is a Director of Generator, Kiwi Landing Pad and Technology and Innovations New Zealand.

The Go Vocab team (featured in issue 6 of NZ Entrepreneur) working from the KLP For more information about Kiwi Landing Pad Web: www.kiwilandingpad.com Twitter: www.twitter.com/kiwilandingpad Facebook: www.facebook.com/KiwiLandingPad Flickr: www.flickr.com/photos/kiwilandingpad/ Email John Holt: john@klp.org.nz Email Catherine Robinson: catherine@klp.org.nz Special thanks to Kevin Ptak from Mako Networks

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ISNETC ER W T VI IOE N

10 Questions with

RodofDrury Xero Great businesses are started every day when people act upon an opportunity. Rod Drury is one of New Zealand’s most successful and best known entrepreneurs, we talk to him about the story behind the Xero, the future, and what makes him tick.

You’ve built many businesses including Glazier Systems and Aftermail but you’re best known for your success with Xero.

When you first founded Xero, was your vision for the company similar to how the business looks today or is it different to how you imagined it turning out in those early days?

foundations, but we are still in the early stages of our journey.

It’s really exciting how the opportunity and strategy behind Xero is playing out as expected. We saw the small business transition to the cloud as a once in a lifetime opportunity and our team is executing the strategy very well.

Not at all. When I got a School Certificate (the former secondary school qualification for high school students in Year 11) I was the most educated Drury of all time. I was fascinated by software and the scale it gives. With software you solve hundreds of problems a day and you see cause and effect. I think software provides accelerated feedback cycles so you learn, reinforce and create confidence. That thinking is also a key skill when building businesses and teams.

As you progress through each business you gain more experience, networks and capital and your personal goals change. Glazier Systems was about creating a job to use the new programming tools we wanted to work with. AfterMail was designed as a trade sale from the start so we could make some money. After selling AfterMail to Quest I saw what doing a public company in software could look like and that seemed like a great challenge, and a lot of fun. So the goal was to build a long term, scalable and global business and see how far we could go.

Starting a business is a scary thing that puts off a lot of people.

I’m more excited about Xero now than when we started.

We’ve eliminated a lot of the early risk and have built the core

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Our vision is to be a globally admired company that makes life easier for millions of people around the world. We get such a kick when people let us know they now find accounting fun.

Do you come from an entrepreneurial background?

What was the most painful lesson you’ve had to learn in business? Have you experienced any bad times?

Pacific Fibre was a good experience. It was financially painful but it was more the frustration and lost opportunities that rankle today. I’ve largely avoided real problems by treating what I do as a portfolio and by being aware of opportunity

UK Xero team members at the eWay global balloon drop

costs. When things aren’t working I try to quit them as soon as I can as my time and resources will be better spent elsewhere.

So I think failing quickly is a key skill for entrepreneurs.

The things that stick in left my to mind that wereBanks, notably bad are Dan Alpe From right: John Tim Alpe, mainly when people let you down. Normally that comes from failure or a fear to communicate bad news. I think it’s so important to surface issues early so you have time to fix them.

What achievements are you most proud of during your career and is there anything that you still want to achieve but haven’t yet?

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I have to pinch myself that we started this from scratch

Hopefully this doesn’t sound too cheesy but when I see our team doing awesome work that was even better than I imagined (which happens a lot) I get a huge buzz. We have over 500 people in an awesome company.

It was only a few years ago there were just four or five of us crammed into a small apartment. Now I go to Melbourne and we have a building with our name on it. We are creating something, a really special company, and I have to pinch myself that we started this from scratch.

Listing on the stock exchange was a real highlight. Seeing your company on the NZX Main Board and then in the nightly news was crazy, but it is a double edged sword and we have to deliver to our shareholders.

We are going hard for growth, which means investing ahead of revenue to create a bigger long term business. That is very

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ISNET C ER W TVI IOE N different from most businesses and it’s the right thing to do.

But I am looking forward to when the lines cross over and we can also say we are a profitable company as well. I think when we hit that point I’ll feel like we made it. I’m looking forward to what Xero feels like after that. It will be a strange feeling after having our heads down for so long but one I really want to experience.

Xero listed on the NZX reasonably early compared to other companies who look into an Initial Public Offering (IPO).

Do you think other businesses should consider this an option to raise early stage capital?

I think our playbook is now understood in the tech sector. So for the right type of company, and the right type of people, following what we did will make sense.

It’s not for all but I’m very proud that we have created a new option for entrepreneurs in New Zealand.

What are the most important business skills you would advise up and coming entrepreneurs to develop?

Being an effective communicator and networker. I’m always trying to create benefit for people in my networks and it tends to come back with a multiple. Having the ability to get the resources to build a great team to execute strategy is what needs to be done.

Xero now has several offices worldwide - including San Francisco

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You could have picked anywhere in the world as a base location for Xero, why did you choose Wellington?

Wellington is a great place to build a software company.

Already we are global with over 12 offices. So Wellington is a good place to start and be the head office but we are operating in four countries. Wellington, as a capital city with Government and bad weather means that it has always had a strong technology sector. So the skills are here.

Also, simply, it’s where I worked and built networks. I was here for the windsurfing but with kids that’s a bit more challenging and so I now live in Hawkes Bay and commute.

Why do you think you’ve been so successful? Is there a secret formula?

Software and software businesses give accelerated experience.

I have a passion for the power and elegance of software and have been lucky enough to be around when software evolution has created business opportunities. Over time you can become more confidence and go bigger and bigger. I’ve learnt to see the possibilities and communicate a vision and then prove it.

So I think it’s learned behavior, affinity with myself personally and timing coming together. So far it’s taken over 25 years.

It’s been weird seeing the increased profile. That’s a byproduct of being successful I guess, but I find it a bit weird.

I still spend most of my time thinking about software and strategy and getting our product out the door.

Rod pictured with award winners at Xerocon What do you think are the things New Zealand needs to improve upon when it comes to creating more successful businesses?

That there has never been a better opportunity to do things globally significant and still enjoy our fantastic lifestyle. No one is holding you back. We also need to feel responsibility to contribute to exporting. If we want better schools and hospitals we simply need to sell more stuff overseas.

Working internationally is a great experience and can be a lot of fun. So we just need to go for it.

You’ve already achieved so much in terms of business success. What’s next for you?

It still feels very early for Xero. It’s the longest job I’ve had yet but I’m enjoying each phase. Right now we’re in the massive expansion phase. We’ve added 200 people so far this year and it’s very stimulating to grow that fast but maintain our culture, but it’s working. We already have 60% of our revenue from offshore so we are in transition from being New Zealand centric. We have so many other phases and experiences to come so there is a lot to look forward to.

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There has never been a better opport unit y to do things globally significant

To find out more about Rod and Xero, visit their website at www.xero.com

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G SE etting C T I O N I t D one

How to sell more Know your key benefits One of the most well known pieces of advice in selling is that customers buy benefits, not features. Yet for all the talk, it’s unbelievable how many sales people and business owners let themselves and their fantastic products and services down by ignoring this simple rule.

I

n selling, and in business, one of the traps we fall into is that because we’re dealing with our products and services every day, we start assuming that our custom-

ers know just as much about them as we do, and therefore should already know why they should buy from us and not our competition.

But the fact is, nobody knows more about our products or services than us and it’s our job to convey exactly how the features and benefits of our products and services will make the lives of our customers better in some way.

Think like your customers think To be able to present your features and benefits to your prospects effectively, we must first learn to think like them and to understand the underlying problems people are really trying to solve whenever they make a purchasing decision.

One of the difficulties in selling is that often people won’t tell you the real reasons why they want to buy. Think about it – would you ever tell a salesperson that the real reason you want that new car is to turn heads whenever you’re driving through town?! Fortunately though, the real motivation

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behind most buying decisions (the underlying motivators or “needs behind the needs”) can be traced back to just a few well established human needs.

Almost every decision we make, including our buying decisions, is geared towards satisfying one or more basic human desires. And no matter what it is that we’re considering buying, chances are that you can trace our surface reasons for buying back to one of the following reasons: Security/Safety – We want peace of mind.

Wealth/Money – We’re interested in either making more money, or reducing expenses.

Popularity/Respect - We want to be respected and liked.

Health/Long life – We want to be healthy.

Love/Sex – We want to feel loved and desired.

Save Time – We want more time to do the things important to us.

So whether you’re selling in a retail environment, business to business or providing services to the general public, take some time to do the following exercises and start putting these key sales skills into practise today.

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Step 1 Choose one of your key products or services and make a list of the different types of people to whom this product or service is generally sold. Are they students? Mothers? Surfers?

Gardeners? Old people or young people? Rich or poor? And if you’re selling to other businesses, who are the key people within your customers organisations that are involved with the decision making process? For example, are you selling to General Managers? Financial Controllers? Office Managers?

IT Managers? Shareholders?

What is it about your product or service that is unique, or beneficial or different in some way?

Once you’ve done this, write down the underlying motivator from the list above that is most likely to apply for each type of customer. For instance, if you’re selling laptops to businesses, the General Manager is most likely to be interested in increasing productivity (increasing profits), while the Financial Controller is most likely to be interested in how the purchase affects cashflow (reducing costs) and the IT Manager will most likely be interested in whether the specifications of the laptops are up to scratch (security of data).

This is especially important in business to business sales as you can start to see that even people from the same company will have different motivators for going ahead with a deal and will often require you to present different features and benefits to each of them if you are to secure their business.

Step 2 Next, make a list of the 5 main features of the particular product or service you’re selling. What is it about your product or service that is unique, or beneficial or different in some way? This can include physical features (eg “shock resistant rubber casing” on a mobile phone), service based features (eg “your accounts done within 10 days” for an accounting service) or quality based features (eg “built by fully certified Master Builders” on a residential apartment block.)

Step 3 For each of the 5 features you have listed in step 2, write down two major benefits that each feature provides your customer using no more than a sentence for each one. When doing this, imagine that you have just told your prospect about one of the key feature’s of your product or service and they have now said to you, “So what?”

The idea of this step is so that you can convey how each feature will be of benefit to your prospect quickly and concisely. For example, using the apartment block scenario, the feature might be, “All our apartments are built by certified Master Builders…” and one of the benefits of that might be, “…Which means they meet the highest standards of quality and building compliance.” Or another benefit might be, “…

Which means all workmanship is guaranteed for a minimum of 10 years.”

Step 4 By now you should now have a list of five key features and a total of ten benefits of those features. And now for the most crucial step.

Once you’re clear on the key features and benefits of your product or service it’s essential that when presenting them to your prospects that you take the final step of linking them back to the underlying motivators of your potential customers, whoever they might be.

Next to each benefit listed, write the underlying motivator and type of customer that is most likely to be interested in this benefit from your list in step 1.

Again using our building example, the underlying motivator that the benefit of “meeting the highest standard of quality” might satisfy, could be the purchasers need for being seen to own an attractive investment property (respect). And the underlying motivator that the benefit of workmanship guaranteed for 10 years” might satisfy, could be the need to have peace of mind that they made a sound investment (security).

Once you’ve completed this final step you should now have a good idea of exactly what features and benefits your prospects are likely to be interested in.

Just knowing this will make you more confident, you’ll appear more knowledgeable about your business and you’ll be more effective showing your clients how your company can help solve their problems.

Richard Liew is an Auckland based entrepreneur and founder of NZ Sales Manager and NZ Entrepreneur magazines. He is also CEO of Espire Media. Link up at http://nz.linkedin.com/in/richardliew

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The

Makerspace Want to make rocket powered race cars? Create a 3D printed prototype of your new product design?

Keep the kids busy with a practical learning project? Or just generally tinker with laser cutters, routers and angle grinders? Whatever crazy things you have in mind, the Wellington Makerspace will be able to help you out.

T

he Makerspace is a one stop shop for people looking to produce ideas and inventions into physical products and businesses wanting access to smart design ‘nous’

all without needing to invest thousands of dollars to get the right machinery, tools or employees for the job.

Fresh of the back of an amazingly successful Makertorium event (a joint venture between The Wellington Makerspace, Makers Org NZ, Mohawk Media, Diatom Studio, Pixel Brid, Marmalade Monkey and Wellington City Council) Lee Bennett and his business partner Steven Almond are now throwing themselves into more and more projects as the Makerspace expands its services.

The partnership came together after Steve turned up on the doorstep, bored with his OE and wanting somewhere to make the most of his industrial design skills and experience. At the time, Lee needed some help, so leapt at the opportunity. It’s a match made in makerspace heaven – Lee’s background in the engineering and film industry brings local and national connections alongside years of experience magic-ing products from the depths of imagination. Steve’s skill in design and prototyping brings the detail and focus required to make practical, saleable items. The personality combo is important – as for all startups there’s got to be a complementary approach; ‘Lee’s the say-it-how-it-is salesman and promoter and I’m the calm (or balm!), tenacious completer’ says Steve.

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The Makerspace have monthly memberships available

Lee Bennett (left) and Steven Almond (right)

It hasn’t been easy for Lee and Steven after starting the business from nothing just 12 months ago, including figuring out how to get a 1.5 ton machine up a flight of stairs in time for the grand opening.

“We’ve spent all our savings, all our partners’ savings and maxed the credit cards. We’ve still not quite got used to that ‘day-before-the-20th of the month, butterflies in the stomach’ feeling that comes with managing cashflow down to the last cent!” Lee says. With no previous experience running their own companies, the duo have taken heart from talking with other entrepreneurs, including Lee’s girlfriend who has her own business too. “Understanding that they’re not the only ones with no work/life balance, that being tired and making up the rules as you go is normal, is a relief.”

The Makerspace runs workshops, has monthly memberships for people wishing to access the Makerspace’s facilities on a regular basis and is also a professional design studio with relationships with suppliers of raw materials, and thus, access to them at low cost. Because they chose the name Makerspace and identified themselves with this ‘movement’, the first product offering was the memberships to achieve a vision of creating a space in the city where people with no access to cool tools could make their designs a reality. Sadly there were more maker ‘groupies’ than makers willing to pay to participate, so the team had to pivot to find ways to pay the rent. Part of the reason for this, the team felt, was that people thought that 3d printers, laser cutters, routers were all shortcuts to making things, and were put off by the time still required to bring a design to life. A little bit of the ‘I want it now’ mentality.

With this in mind, and building on the success of the earlyestablished ‘Mini Makers’ workshops, education is now a core strategy for the business. Via the online Meetup group,

the Makerspace runs 3 - 4 workshops per week to introduce people to the laser cutter and the software that drives it, along with 3d printing, jewellery making, Z-brush, Arduino, screen printing and more. An outreach programme into schools is also underway.

Alongside this, Steve and Lee have gone back to what they’re brilliant at – taking ideas and making them into real things.

The heart of the Makerspace is now a prototyping facility, a high-end design and build workshop that has attracted the likes of The Body Shop, Icebreaker, ESR, Te Puni Kokiri and the National Library to contract the team to deliver new

“

Ask yourself the question.... would you rather be working somewhere else?

Sr P EC o Tf Ii O le N:

The Makerspace produce custom commercial work products and services for them. Local small businesses have also engaged their services to develop cool signage, interactive displays and quirky installations.

‘We’ve not put the ‘makerspace’ concept completely behind us – we’re not totally mercenary!’ Lee says. The memberships are still popular and the existing members bring fascinating projects that inspire some great discussions at Friday drinks. The Makerspace also hosts groups of at-risk children each week to expose them to new ideas and build their skills, giving them opportunities for work they might not have thought possible.

It’s been a classic roller coaster ride for the Makerspace team but worth every moment. Neither Steve nor Lee can imagine working as an employee for anyone, ever again.

Reflecting on the privilege of directing where the company heads, the choices to be made about who to work with, who to hire, what to do each day, keeps Lee and Steve motivated and they advise other entrepreneurs to do the same. ‘It makes us grateful for what we have, even though its hard, the tough times are still under our control. We might be here late on a Friday night, early on a Sunday morning and all the rest of the hours in the week, but it’s our choice.’ Asking and answering the question ‘would you rather be working somewhere else’ is a great way to remind yourself of what you’ve got on days you can’t see the wood for the trees.

Other advice from the duo – give back to the community

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and your networks. Putting on Makertorium was a huge investment of time and money but it bonded the fledgling business into the network of ‘Makers’ in New Zealand and put their brand top of mind for Wellingtonians by giving them a mind-blowing experience that many people are still talking about. Throwing parties at the space and running workshops at a loss also cost financially, but the networks that they’ve built as a result of all of these activities pay the investment back on a daily basis. Supportive suppliers, referrals, partnerships with local companies etc.

Just be true to your vision. It’s been a complex path to navigate from Makerspace to more of a ‘space where making happens’ and the team have fended off negative comments from some of the Maker community who are uncomfortable with the commercial aspect to the business. By sticking to what they love, what they’re good at and what clients want, there’s a viable business at 6 Vivian Street, Wellington that will be making magic (and much more) for years to come.

Find out more at: Website: www.wellingtonmakerspace.com Facebook: www.facebook.com/TheWellingtonMakerSpace Twitter: @wellymakerspace

One simple search and I’m in business!

Get your business off to a great start Securing a business name is simple with the new ONECheck online tool from Business.govt.nz Simply enter your proposed name, hit search and you’ll find out immediately if your name is available as a company name, website address and trademark.

ONECheck

It’s quick, easy and one of the most valuable things you can do for your business.

Check it out at www.business.govt.nz/onecheck 21

SECTION

TAKING THE PLUNGE

Oliver McDermott (left) and Ben Thomsen (right)

Blender Design

Oliver mCDERMOTT Profile by Nick Harley Each month, we talk to up and coming New Zealand entrepreneurs who have set about turning their idea into a real business. Here we speak with Oliver McDermott about his company - Blender Design

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Briefly tell us about your business?

Blender Design Ltd was founded by Ben Thomsen, Charlie Moran and Oliver McDermott in 2006, at the end of their Industrial Design degrees. The trio were eager to pursue their passion for innovative product design. With this passion, and the constant pull to create new things, they set out to help companies be ‘better by design’.

The name Blender was chosen to represent the combining of their individual skill sets and expertise. It also appropriately symbolizes the blend of so many important facets of design.

Ben and Ollie took over Charlie’s share of the company in 2010 to form the management team that drives Blender today.

What is the big goal for your business?

The Blender vision is to be a leading design brand recognised for creating the highest quality, innovative products designed in New Zealand and sold to the world!

In this sense, we are focused on high-value exports which highlight our kiwi ingenuity and design talent on the global stage. The Blender team is committed to building successful products and businesses from great ideas.

What inspired you to take the plunge?

I’ve always been pretty entrepreneurial, I started my first company importing ergonomic laptop stands when I was 19. In our final year at university a group of us got together and went to the Milan Furniture fair to exhibit our furniture designs. It was our first taste of the design industry at an international level and inspired three of us to take the plunge and create our own consultancy. When we graduated we just went straight out and looked for clients who we thought we could help. I haven’t looked back since.

What have you found to be the most challenging aspect of building your business so far?

By far the most challenging thing for me personally has been having to play so many different roles in any given day. Time management and self organisation is essential. The biggest challenge for our business so far has been building our network of key partners and suppliers, they are so important to us.

What keeps you going when you feel like giving up?

Knowing that I’m creating something that I really believe in, something that matters and something I am passionate about. I really enjoy the challenge of owning a business and the people too, it’s the people that really make it: our staff, our clients, our partners. We have a great team, an innovative culture and we’re all committed to a common vision.

What advice would you give to any people reading this who are thinking of starting a business?

Surround yourself with the right people and build a good support network. This is so important, you can never have too much advice. Maintain a laser like focus on your vision or purpose and don’t be tempted by distractions that steer away from it. Work your ass off and the rewards will come.

Website: www.blender.net.nz Facebook: www.facebook.com/blenderdesignltd Would like to tell our readers your own story? Get in touch with Nick at nick@nzentrepreneur.co.nz

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T o m o r r o w ’ s E nt r ep r ene u r s

Young Enterprise Terry Shubkin, CEO Young Enterprise Trust

M

ost of our day-to-day work involves helping young people develop their entrepreneurial skills and talents, but there is one time of the year

when we have an additional focus. In 1994, Young Enterprise Trust established the New Zealand Business Hall of Fame, which recognises those who have made outstanding contributions to both their industry and community.

More than 130 New Zealanders have been inducted into the Hall of Fame, which reads like an honour roll for New Zealand business. Sir James Fletcher was one of the first laureates to be inducted in 1994, alongside Sir Woolf Fisher, William Goodfellow, Bryan Todd, James Wattie and Jack Newman. Since then they have been joined by

the likes of Sir Logan Campbell, Robert Hannah, Apirana Ngata and Wilson Whineray.

At the end of July we hosted the 2013 gala dinner, and inducted eight new laureates into the Hall. Every year, each laureate and their family is accompanied by a secondary student, often one who is taking part in a Young Enterprise programme. This is important to us – it is a visible connection between our work with young people, and the Hall of Fame.

We will be calling for the 2014 nominations to the Hall of Fame soon – if you know of a businessperson who has made a huge impact on New Zealand, we’d love to hear about them.

Eight new laureates join the NZ Business Hall of Fame

E

ight new laureates have been inducted into the New Zealand Business Hall of Fame. The event was held on 31 July at The Langham, Auckland, and the laure-

ates were inducted into the Hall of Fame by the GovernorGeneral, Lt Gen Rt Hon Sir Jerry Mateparae.

The 2013 laureates included: •

Sir John Anderson, inducted for services to banking

•

Sir George Fistonich, winemaking

•

Sir Colin Giltrap, motor industry

•

Sir Dryden Spring, agriculture

•

Hugh Green (1932-2012), construction

•

Mary Jane Innes (1852–1941), brewing

•

Val Barfoot (1897–1987) & Maurice Thompson (1907– 1968), real estate

Living laureates and their families were interviewed onstage

by Fairfax Media Business Editor Fiona Rotherham, and they provided insights and anecdotes about their business success.

Sir George Fistonich explained why he turned his back on a building career to go into winemaking at just 21 years old, while Mary Jane Innes’ great-great-grandson Charles explained what life was like for one of New Zealand’s first businesswomen.

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Deputy Prime Minister Bill English was also in attendance and spoke of the growing recognition of business and enterprise in New Zealand.

“I think something pretty special is happening in New Zealand about business. I think today New Zealander’s have a better understanding of the contribution that business makes to their livelihoods, their community and their country, than at any time that I can recall. I think they know that the dynamism, the creativity, the risk-taking and the success of business is what gives them jobs and incomes, and if they want more of either, they need more successful business.”

One of the highlights of the evening was a speech by Young Enterprise Student Ambassador Darren Ritchie. Darren, from Mt Hutt College, was chosen to speak on behalf of all Young Enterprise students. He spoke about the effects of having instant data at your fingertips, saying that a world of unlimited information creates both opportunities and challenges.

“The possibilities and opportunities available to youth are mesmerising. But the burden of all this information creates inertia, it stops us from moving forward. Competing interests, ideas and advice provide limitless pathways but fail to give us direction. This is where I ask for your help. You can help us consolidate and break free of this information overload.”

2

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Darren Ritchie from Mt Hutt College gives the closing address at the NZ Business Hall of Fame 2013 (Inset - Sir George Fistonich accepts his citation into the NZ Business Hall of Fame from the Governor-General. To the right is Sir George’s grandson and student escort Milan Fistonich)

Darren said that his experiences with The Lion Foundation Young Enterprise Scheme have changed his perception of the business world, and asked the audience to help other young people open their eyes to the possibilities that business provides.

“

The possibilities and opport unities available to youth are mesmerising

Support Young Enterprise Trust at Give A Little

“You can make a difference. You can help ground youth and provide pathways to the future. You can play an important part in developing the innovators, thinkers and business leaders of tomorrow.”

Young Enterprise Trust is dedicated to growing a more prosperous New Zealand through enterprise.

Our aim is to ensure all New Zealand students participate in experiential enterprise education and financial literacy programmes. Young Enterprise also runs the Fairfax Media NZ Business Hall of Fame, which recognises New Zealanders who have made outstanding contributions to business and the community.

I P / I nno v a tion

Watch Your Words The Google AdWords policy has recently changed. Corinne Blumsky outlines the changes and suggests ways to protect your trade mark from being used by a competitor.

What is Google AdWords?

Any retailer doing business online needs to know about Google Adwords.

Google Adwords is the system that Google developed to help a business market its products or services in the Google search engine and its affiliated sites.

Google Adwords is a useful tool to help get your business’s name to the top of Google’s search engine rankings. It allows retailers to purchase keywords that consumers use to find their products online.

When a Google search is made and that search includes a purchased keyword, the purchaser’s advertisement will appear as a ‘sponsored link’, usually to the right or above the main search results.

still has a complaints process which you can use to object to your trade mark being used by a competitor.

Other legal action may also be possible like passing off or a breach of the Fair Trading Act. What should I do to protect my trade mark?

There are some basic steps you can take to protect your trade mark. Here are a few suggestions.

•

Register your trade mark if you haven’t already. A trade mark registration provides the best basis for protecting your trade mark for the goods and services that you provide.

Google will only investigate a trade mark complaint if you can establish you have valid trade mark rights. This is much easier with a trade mark registration.

•

Review your trade mark registrations. Make sure your registration covers the trade mark you are actually using for the goods and services you provide. It is not unusual for a trade mark to be tweaked and changed over time. Nor is it unusual for a retailer’s product offerings to change over time. If the trade mark you have registered differs from what you have a complaint about it will be more difficult for Google to validate your rights and act on your complaint.

•

Conduct regular searches of your trade mark on Google. Set up a system to ensure that those searches are made. Google doesn’t monitor the misuse of your trade mark - this is up to you. If there is use you are concerned about, seek legal advice on your options.

•

Be careful if you intend to use someone else’s trade mark in any context. Just because Google’s AdWords policy has changed doesn’t make you safe from trade mark infringement. If you are not sure, ask someone who is.

A keyword can be anything written. It can be something generic, like the word “clothing”, or it can be a business’s trade mark.

The system is a ‘pay per click’ system, which means you can dictate where your advertisement appears through bidding for a series of keywords. You only pay the amount you have bid for if someone clicks on your advertisement as a result of a web search.

What’s changed with Google AdWords?

Google has recently changed its AdWords policy in New Zealand and Australia regarding the use of trade marks as keywords.

Google’s previous policy meant that if a competitor was using your trade mark as a keyword, you could complain to Google using its complaints process and Google would stop that use.

According to the new policy introduced from 23 April 2013, Google will no longer act to restrict someone else using your trade mark as a keyword.

What does the change mean?

What the change in Google’s policy means is that it will become more common for businesses to purchase keywords based on their competitors’ trade marks.

Importantly though, Google hasn’t changed its policy on trade marks appearing in the advertising text. If your trade mark appears in the text of a competitor’s advertisement then Google

The last word The same care should be taken with choosing and using Google Adwords as with any other form of advertising. Be alert to others purchasing and using your trade mark as an Adword. Also be careful about the words you choose!

Written by Corinne Blumsky. An edited version of this article was published in NZRetail magazine, issue 719

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NZ Entrepreneur Club is a supportive community group for individuals who are currently in the process of building new businesses and startups. We get together on a regular basis, face to face (where possible) to talk about entrepreneurship, business, marketing and success in life. Come along to our next meetup!

Wellington Next Event - Monday 3rd September - 5:30 PM

Join this

Wellington Organising Team Jono Rowe

Nick Harley For more information visit: www.meetup.com/The-Entrepreneur-Club-NZ

Auckland - Coming Soon!

Christchurch - Coming Soon!

If you are interested in helping to organise regional entrepreneur events in your area then please contact Jono or Nick for details.

Competition Winner!

Last month we were giving away a free copy of Sandy Geyer’s new book “Path of the Lion” to one lucky reader!

Congrat ulations ....

Jesse Cleave Howick, Auckland

Well done Jesse a free copy of the book is on its way to you!

Thanks to everyone who entered.

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PS E ER C STOI O NN AL T RA I N E R

Entrepreneurial Intelligence with Sandy Geyer Are my employees the problem?

By Sandy Geyer I’m not sure if it’s just me that feels this way but why is it that most employees are so lazy and don’t use their common sense? What’s the point in hiring people when I just end up having to do their jobs for them? How do other employers do it? What am I missing here?

What you are missing is that leadership is everything in this area and you are at the root of your problem. There is no doubt that it’s difficult to find committed people, and the work ethic in general seems to be getting worse, but we have to be responsible for who we take on. Here are some tips to employing the right people: Always hire the traits which are the hardest to teach ie. accountability, honesty and focus. The candidates need to prove these from previous work experience and their professional development journey so far. Check references carefully and make sure all periods of work are covered with references available. If they are late for the interview, misspell words in their CV, dress inappropriately or don’t communicate well - stay away from them. How they present themselves on their “best behavior” (in an interview) is a very strong indication of what you might land up with and if you have a negative instinct, listen to it, even if they have the most impressive skills base. A very experienced entrepreneur once told me that if we take the time to employ properly, management is easy, but it also works the other way round - and he was dead right.

Use employment tools such as personality profiles and proficiency testing. This gives you important insights into their strengths and motivations and a good idea of what they can actually do. Also, these insights assist you to manage them effectively and motivate them appropriately.

Base their wages on performance and not hours. If you pay them to show up its likely that’s all they will do. Remunerating for performance creates a win-win situation from the start and they are automatically incentivized to want to do well.

Unless your company requires access to facebook, twitter etc. during working hours, block these applications as they cause major loss of focus and productivity. Don’t get too attached to your employees. Being the business owner can be lonely and it’s tempting to befriend our employees; but at some point, someone has to be the boss and offer guidance, and maintaining a professional distance equips us far better to deal with employee related issues appropriately as they come up.

Don’t take non-performance personally. In most cases non performance is due to lack of understanding, difference of focus or unconscious incompetence. Try to get a good understanding of why the person is not performing and deal with it constructively through better communication and skill training, or start termination proceedings if all else fails. Losing productivity and employees is distressing but it’s all part of being a business owner and it’s seldom a personal issue.

In each issue Sandy will be answering commonly asked questions from new entrepreneurs.

If you have a question for Sandy to do with entrepreneurship, building successful businesses or the challenges and difficulties faced by entrepreneurs, email the editor at nick@nzentrepreneur.co.nz.

Sandy Geyer is an entrepreneur and mentor and teaches the principles of entrepreneurial intelligence (EnQ), to entrepreneurs in New Zealand, Australia and South Africa. You can visit Sandy’s website at www.enqpractice.com

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SE T hC e TpI a O ddoc N k

What’s on for entrepreneurs?

The Conference for Entrepreneurs Morgo is the annual get together for people actively engaged in building high growth companies into the world – CEOs, CTOs, CFOs, founders, very active board members etc.

Date: 4th - 6th September 2013.

Where: Hilton, Queenstown

Startup Weekend is where entrepreneurs, developers, and designers get together to form new businesses in a 54-hour marathon of inspiration, perspiration, collaboration, and fun!

We attract people with all skill levels in a friendly, welcoming, yet challenging environment.

For more information visit: www.morgo.co.nz

Palmerston North - 20th September 2013 Universal College of Learning For more information visit www.palmynorth.startupweekend.org Dunedin - 20th September 2013 University of Otago Business School For more information visit www.dunedin.startupweekend.org/

IOD COcktail Functions Taranaki - 27th August 5:30 PM - 7:30 PM Canterbury - 16th September 5:45 PM - 7:45 PM Auckland - 20th September 5:30 PM - 7:30 PM Wellington - 27th August 5:30 PM - 7:30 PM For more information visit: https://www.iod.org.nz/BranchesEvents.aspx

Upcoming ICEHOUSE Events The Better work tour

First Wednesdays

Wellington - 11th September

On the First Wednesday of every month, The ICEHOUSE opens up to ambitious entrepreneurs who are hungry to understand the steps to start-up business success. Access our knowledge, tools and contacts to discover how to turn your idea into a business success.

Auckland - 13th September

Date: Wednesday, 4th September 2013.

For more information visit: www.bizdojo.com/event/index.html

For more information visit: www.theicehouse.co.nz/first-wednesday

What coworking can teach us about the future of work Christchurch - 9th September

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SECTION

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“

I like thinking big. If you’re going to be thinking anything, you might as well think big.”

Donald Trump

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