HNW Magazine Jan/Feb 2012

LINKING ENTREPRENEURS & INVESTORS UK-WIDE IN THE NEXT ISSUE

High Net World Magazine JAN/FEB 2012

Steve Moffat Of Shhh-oohs and Chictopia

IN THIS ISSUE

Nullius In Verba Take No One’s Word For It Also inside: TECHNOLOGY WAVES AND THE HYPERNET

Predictions & Positions: Armageddon in a Tea Cup

GOOD vs BAD LEADERSHIP SHOWCASE INVESTMENT UWI TECHNOLOGY TORRES PILOTING AMBITION PRACTICAL BUSINESS THE LAW OF CONFIRMATION BIAS THE PHILOSOPHY OF BUSINESS FAILURE

STEEL’S VIEW

GECKO’S DIGITAL LENS

RUTHLESS

PAST IMPERFECT-FUTURE TENSE Page 7

BIG AUDIENCE, NO MONEY Page 9

A SLOW ASSASSINATION Page 39

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HNW MAGAZINE JAN/FEB 2012

In this issue

The Editor

SPECIAL REPORT

Technology Waves & The Hypernet

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18

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Some Waves - like the PC revolution, client/ server, the Internet, and social networking are so big that they change the world.

FEATURES

How Entrepreneurs Can Thrive in the Recession

COLUMNS

Pete Higgins retells the moment of doubt four yerars ago that led to the invention of the UWI Label and its multiple market applications.

The Amanda Kremer Interview

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Why the firebrand who runs pure networking organisation Thrive for Business was a bit reticent about being interviewed by HNW.

2012: Predictions & Positions 18 The Latin expression ‘Nullius in Verba’ is translated as ‘take no one’s word for it’, and there’s no better phrase to describe the coming year.

Good vs Bad Leadership Hard times and the Hirsh study: Why leadership skills are important at all times but paramount during difficult ones like we’ve recently endured.

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Loosely translated it means ‘take no man’s word for it’. There’s a lot in that. Too often in the swell of a digital information age that we’ve yet to learn to control, and media channels far more lobbyists than enlighteners, we drown in the perspectives of relative strangers.

And then we buy into the perceived Armageddons; bird flu, killer bees, water wars, global warming (oh, yes I said it), Greece & Portugal, Y2K and, of course, who can escape the rise of the Mayan calendar.

PSYBT director Geoff Leask and Company Creators’ Alastair Balfour help highlight the importance of developing business strategies for young people.

HNW’s Investment Showcase

There’s a wonderful Latin phrase, first introduced to me by the investment Sage of Linlithgow Alan Steel that reads ‘Nullius in Verba’.

Raising Funds Steel’s View Gecko’s Digital Lens Interview: Amanda Kremer Mike Williams Leadership Steve Paterson Ray McLennan

2 7 9 11 25 32 35 36

REGULARS Showcase Investment Ambition The Networks Employability International Client Service Practical Business Technology Ruthless Diatribe

3 5 14 16 23 33 34 37 39 40

It reminds me of William Shakespeare’s Macbeth, and the title of William Faulkner’s fourth novel The Sound and the Fury, and the phrase: “And then is heard no more: it is a tale told by an idiot, full of sound and fury, signifying nothing.”

These end-of-the-world stories are exactly as the bard described.

Perhaps we should take Shakespeare’s lesson and pay closer attention to what we can prove is true, investigate and understand, rather than what we’ve been told and somehow accepted without verification.

After all isn’t challenging belief systems and what is purported to be truth the mother of invention, of entrepreneurialism?

Emerson HNW Magazine Editor

Published by Bronx Media Limited Registered Office 4/2b Carpet Lane, Edinburgh EH6 6SP Editor Ed Emerson, ed@hnwscotland.co.uk Contributors Alan Steel, Gold? Let It Be; Mike Octigan, Measuring Social Media; Mike Williams, The View from Manhattan; Steve Paterson, A Tale of Two Cities; Ray McLennan, The Legal Market Gold Rush; Marie Marin, Third Sector Self-Reliance Client Service John Kennedy Operations & Distribution Cath Emerson, cath@hnwscotland.co.uk Graphic Design Full Circle Graphics, www.fullcirclegraphics.co.uk The views expressed in HNW Magazine are those of invited contributors and not necessarily those of Bronx Media Limited. Bronx Media Limited does not endorse any goods or services advertised or any claims or representations made in any advertisement in HNW Magazine, and accepts no liability to any person for loss or damage suffered as a consequence of their responding to, or reliance on, any claim or representation made in advertisements appearing in HNW Magazine. By responding or placing reliance, readers accept that they do so at their own risk. ©2011 Bronx Media Limited. Reproduction in whole or part is forbidden without the written consent of the publisher.

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FUNDING

HNW MAGAZINE JAN/FEB 2012

Top 10 Tips: How Entrepreneurs Can Thrive in the Recession Thrive for Business’ recent guest speakers, Prince’s Scottish Youth Business Trust (PSYBT) director Geoff Leask and Company Creators co-founder Alastair Balfour, helped highlight the importance of developing business strategies for young people and their contribution to the economic development and community regeneration of Scotland.

GEOFF Leask explained that, within PSYBT, even those who are most disadvantaged are prioritised in order to truly make a difference: “We believe in not just giving money, but the whole package.”

1) Get a specialist who knows what they’re doing. It’s not a game. There is no point approaching a bank alone as they are usually not interested unless you owe them money.

This package of support includes their Market Test Grant, a recent innovation at PSYBT allowing business ideas to be tested in market conditions to determine sustainability and customer interest.

2) Unless you convince people their money is safe with you, no one is going to give you any. And unless you’re willing to put up some of your own cash first, no one will trust investing theirs.

The result of his organisation’s efforts across over 600 businesses has been an increase in survival rates in year 1 of 80%, and year 2 of 60%. (You really should have comparison numbers from the previous years).

PSYBT are set to publishing their top 100 business list soon, comprising companies with turnover in excess of £5 million per annum.

Alastair Balfour of Company Creators stated his company’s aim, which fills the gap between funding and business support, is to target 18 – 25 year olds.

However he also made clear his perspectives on the importance of teaching the principles of business as early as primary school.

Alastair Balfour, whose Company Creators currently support over 150 companies, offered his top ten tips to the Thrive for Business audience about the Do’s and Don’ts of raising finance:

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3) Always under promise on revenue projections to ensure you always over achieve. It is vital to undersell what you think you can achieve in order to build credibility. A leading cause of businesses failing is not meeting sales targets.

4) Investors and banks look at the people that make up your company, they look and analyse your team. Don’t just hire anyone. Ensure you have a solid, trustworthy and complete team who know what they’re doing before you even try to raise finance.

5) When at the bank ensure you have a simple and clean spread sheet including your basic assumptions,

P&L, cash flow, balance sheet and sales targets. Bankers like simplicity and neatness. If one number changes at the top even as an assumption, you can easily and clearly see the changes down the sheet.

6) Target your investors and do your research. Different investors have different appetites for businesses.

Make sure you target the right investors who are interested in your type of business.

7) If you don’t know any bankers or investors, find them and build trust and relationship. You won’t get anything from people you don’t know.

8) Ensure business plans are relatively small, around 10-15 pages filled with illustrations, graphics and photos of your team members.

9) Don’t show negative numbers or losses!

Find ways to eradicate them before going to investors.

10) Don’t seek funding without clearly showing you have customers already interested. Show where the money is coming in.

And as a final note he says: “Raising finance should be taken seriously. There is a science to fundraising – it’s a process. Be prepared not to succeed at first and above all, have specialist people involved.”

SHOWCASE

HNW MAGAZINE JAN/FEB 2012

Showcase Investment: UWI Technology The continual questioning of the status quo, what is assumed to be true or considered best practice, is the lifeblood of entrepreneurialism.

OR as Italian physicist Galileo once wrote, ‘doubt is the father of invention’.

Pete Higgins, founder and CEO of UWI Technology in Edinburgh, can certainly relate.

Addressing a small gathering of the High Growth Group – brainchild of Designate’s Jordan Fleming - at Mark Greenaway’s Restaurant in Edinburgh, he retells a moment of doubt four years ago that led to the invention of the UWI Label - a product that accurately informs a product’s ‘use within’ expiry period and offers multiple market applications.

“It was March 2008. I was making lunch for my eight year-old son one weekend,” recalls Pete. “I was about to use a jar of mayonnaise from the fridge.

“The contents looked ok and there wasn’t really a smell but on the back of the jar it said ‘use within four weeks’. Now, if any of you here are like me, I can’t even remember what I was doing last week much less four weeks ago!

“As this was going to be used for my son, I didn’t want to risk it. So I threw the jar in the bin and made something else instead.”

Pete continues: “After coming up with an electronic solution, then a hybrid of electronics and chemical, and working with a fantastic team at Heriot-Watt University, we developed a wholly chemical solution.

“I have been working with the University for the last 16 months. The idea of the label is simple, but the technology behind it is a little more complicated.”

The UWI Label has been recognised at the John Logie Baird Awards as a finalist for Early Stage Impact Through Innovation.

“UWI has a patent in place for the design, a manufacturer on board and a Smart Award in place that finishes in the next few months. We’re moving to creating demonstrator labels and the delivery of a bespoke suite of labels depending upon the client.”

The company is seeking further investment of between £500k and £1.1m, the level of which will dictate the scale of product acceleration.

A first hand view of the UWI Label immediately lends applications across the food & drink, pharmaceutical, aviation and other sectors.

It appears as a thin light cardboard tag that is calibrated and colour-coded, and attaches to both the top of a jar lid and down one side.

The label is activated once the tag is torn at the time of opening, and the countdown

from green (fresh) to red is calibrated based on the products ‘use within’ designation.

“Now we’re seeking the next round of investment as our Smart Award runs out this year.” http://uwitechnology.com The Facts UWI Technology has developed a “proof of concept” smart label intended to supplement the “use by date” on jars of food with “use within” indicators following opening.

Significant market interest has been shown from the life science and food sectors, however a range of other target markets exist.

To date the business has secured £50k private investments and also a further £50,000 in prize money as one of nine regional winners at the Barclays One Small Step business competition.

An additional £70k award was secured in August 2011 from SMART to support further development from a lab based concept to an offering closer to the commercial product.

CEO and founder Peter Higgins, was previously the MD of CGI Media Ltd who offered visual imaging/computer simulation service primarily servicing architects, property developers and letting agents.

The episode got him thinking; first about the contents of his refrigerator, then his cupboards and the issues that could be lurking there. It eventually became recognised as his ‘eureka moment’.

The ‘use by date’ accepted globally as a time-bound warning on freshness - usually in very small writing – has always neglected to inform on when the countdown for food or other products spoiling actually begins.

“I’m no scientist but my training as an architect taught me there are always alternative solutions to the problem, they just may not be so apparent to begin with.”

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SHOWCASE INVESTMENT

HNW MAGAZINE JAN/FEB 2012

Piloting Ambition Elena Torres The good news today is that demand levels have increased on those last seen as far back as 2009, which signals a healthier market.

We are already seeing encouraging signs of a busy January 2012, which is traditionally a slow month.

That said, Europe is up 37% on demand from this time last year; an interesting development considering the Eurozone issues so often referred to in the daily media.

In the early part of the year, I saw steady growth from regular travel patterns in business and winter sports. Then, like others in the global travel industry, we felt the impact of the ‘Arab Spring’, with political instability in those parts of the world leading to a marked reduction in travel.

I founded Exec Air Charter Ltd in 2006 at a time when the economy was booming and business was relatively easy to find.

IN those days of big international mergers and acquisitions, the private air charter business was widely regarded as a good barometer of how well luxury markets and high net worth individuals were behaving.

The same is true today.

So is there really a recession at the top end of the market?

There is no doubt that the world economy is depressed, but there are clear signs that the luxury markets are, to a large extent, immune from recession and are actually recording growth.

I read with great interest last week of reports that Rolls-Royce car sales are booming, as are Bentley’s - they posted a 37% rise in global sales – with good performance in China and the U.S. These numbers demonstrate exports and foreign business will play an important role in moving the UK out of this recession, as well as keeping certain business heads above the water.

For me, 2011 was a very interesting year.

In the early part of the year, I saw steady growth from regular travel patterns in business and winter sports.

Then, like others in the global travel industry, we felt the impact of the ‘Arab Spring’, with

I am increasingly confident that 2012 will be a better year for the luxury sector than the last one, with demand continuing to come from foreign business as the UK economy moves more slowly – a fact borne out by the luxury car business and my sector, private air charter.

I should say that I am confident of better

“

In the early part of the year, I saw steady growth from regular travel patterns in business and winter sports. Then, like others in the global travel industry, we felt the impact of the ‘Arab Spring’, with political instability in those parts of the world leading to a marked reduction in travel. political instability in those parts of the world leading to a marked reduction in travel.

The Summer charter demand remained strong, driven largely by Russians travelling around Europe and the Mediterranean.

August brought about a slight dip in demand for ‘light jets’, which suggests that European travellers were using charters services less often.

However, those effects were offset to some extent by an increase in demand on heavier sized jet charters - again mainly driven by the Russian business traveller – and an upturn in demand for more economical super-light jets.

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times ahead for the UK and I am putting my money where my mouth is and launching a second business - http://www. xclusivetravelclub.com – aimed at growing demand for exciting luxury travel products and services.

In any recession businesses like mine have to fight hard for customers and that should simply mean better customer service and better value.

And on that premise I’m looking forward to a busy 2012.

Elena Torres

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STEEL’S VIEW

HNW MAGAZINE JAN/FEB 2012

Past Imperfect Future Tense?

What a pity it’s still the case private investors rely on the media for investment or economic information.

I write this around the day when most of us give up on New Year’s Resolutions, but I have a plea.

Make one new resolution and stick to it: Stop listening to the media on this because they haven’t a clue.

Think about how many wrong predictions have been made by them, and their so-called experts.

Two years ago it was the collapse of Dubai that was supposed to be the end of the World.

Then it was Greece, Ireland, Iceland, and Bird Flu. Last year it was the Japanese tsunami, the US debt downgrade and the Euro crisis.

Every day we’re told the Stockmarket goes up or down because of one fact or another – a constant focus on kneejerk

short-termism and an obsession with disaster.

Weren’t they supposed to bring down the World economy?

And yet we’re still here.

So How About Some Perspective?

Here’s a bit of perspective – the total GDP of these four is the same as the increase in GDP last year of the US and China.

How about paying attention to facts rather than disaster tinged fiction?

Their total GDP is less than the annual income of the UK, or Brazil.

Let’s take one example, this thing they call GDP. In a conversation over lunch last week with a real expert who does know what’s what I asked how they calculate it.

Big global impact? Not really.

Let’s face it most of the stuff we’re told by the Government or the Inland Revenue is wide of the mark.

Or completely wrong!

I don’t know anybody who has ever been asked what their GDP is - that’s income and the impact on the economy so that you’re informed – but it’s an estimate.

Techniques like that create sampling error which could be plus or minus 2%, or maybe even higher.

So when you’re told that Italy’s GDP plummeted 0.2%, don’t believe it. It might have actually gone up.

Remember PIGS (Portugal, Ireland, Greece and Spain)?

Today we all know the Euro is going to collapse, the UK economy is stuffed, and the US, at best, is a basket case (tongue stuck firmly in cheek!).

And everybody knows there is no point investing in stockmarket funds.

Which is probably why in November 2011, record sales were recorded from equity funds.

What happened to it? It went to the flavours of the day; Cash, Gilts, etc…

As to this year, we’re probably in for another few months of volatility.

But I think 2012 could be the year when the surprises are pleasant ones, those coming out of left field, creating gains for patient investors who buy quality funds managed by old heads who have been round the block a few times.

And there should be good news coming from China.

We shouldn’t ignore this is the year of the Dragon, a Chinese year of good luck, confidence and optimism.

As an investor you have to consider whether the World economy is growing or contracting.

It is growing, interest rates are at a long term low and there are companies whose share prices are fantastic value for money.

I know where I will place my investment money and it’s not in deposit and Bonds!

Alan Steel, Chairman, Alan Steel Asset Management

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GECKO’S DIGITAL LENS

HNW MAGAZINE JAN/FEB 2012

Show Me the ‘Social Media’ Money The choirs of social media acolytes, and the eventual nodding acknowledgement from old school marketers, convinced you that the fundamental shift in communications called social media was here to stay.

AND while you knew that the development of an online audience for your business would require some investment, in both time and financial terms, the expected return on that investment or RoI looked good.

In fact many suggested that there’s “gold in them thar digital hills”.

So you put together a plan to build that online audience and called it, well, “IT”.

Slowly “IT” grew, accruing a digital following from Facebook, LinkedIn, Twitter, Kiltr et al.

Thereafter a bevy of website registrations followed, alongside a smattering of networked contactsturned-connections.

For impact you added business pages on social media channels and even a pinch of growth from those who ‘happenedupon-you-online’.

Now your “IT” audience has become significant; a diverse hierarchy of decision-makers across multi-disciplinary multi-sector businesses.

Score!

But a funny thing happened on the way to monetising that online audience.

You thought that just by creating that audience it would somehow become valuable.

The spectacular dot.com collapse of over a decade ago is testament to how many companies died on that particular vine.

Now your “IT” half-strategy has begun to leer back at you through the pages of the monthly accounts, like the eponymous Stephen King horror genre clown; a yetto-be monetised monster.

And this particular misery really likes company, and companies, the types that badge headline articles about overpriced social media sector stock market IPOs; deriving exponential values against multi-million subscriber audiences with no real discernable revenue streams.

The sector seems to have got hold of Nick Leeson’s calculator.

Note to self: Don’t buy that stock.

So show me the social media money, Jerry. How do you monetise “IT”? Or is the eponymous clown at the centre of your company better off dead?

First, you have to build genuine online relationships. And that’s not so easy.

Social media is neither a panacea nor a quick fix. There is much trial and error.

But while challenging, it’s not impossible.

So because the editor is a Yank (and a New York Giants fan) I’ll exemplify the point with an American Football Team, who just happens to be the Giants’ archrival, the New York Jets!

The Jets backed the very first revenue generating Facebook app which allowed

NFL fans to do online what they would normally do in the stadium or at home; root for their team, predict results, and bring together like-minded fans globally for a virtual tailgate party.

The app, Ultimate Fan, lured MetLife, Motorola, SNY and HotelPanner.com and delivered 10% of the team’s entire sponsorship revenue and is targeted to deliver 50% soon.

So what did they actually do?

They got inside their own fans heads a bit, understood what they wanted and appreciated, engaged with them in an environment of excitement and then socialised the circle with all the things you would do and experience in the ‘real world’.

The Jets (there I wrote it again) Tweeted regularly, took advertising space to promote a contest to win playoff tickets and really made the fans feel closer to the team.

The real genius of the concept is in how they leveraged social media to capitalise on the fans’ passion and then actively shared in it.

And thus monetised “IT”.

Ultimately, it’s fine to start by building the brand through social media channels.

But you have to build magnetism to make money.

That’s the biggest lesson we need to learn in the digital sphere.

Mike Octigan, MD, Gecko New Media

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AMBITION

HNW MAGAZINE JAN/FEB 2012

Amanda Kremer: Thriving in Business “I quite literally broke the phone my first year in business. No headset, just a handset. I picked it up and put it down so many times I actually broke the spring.

When the BT guy showed up I got some strange looks. That’s how hard I worked – it tells you how much it takes to get there.”

I’M nestled amongst the fireplaces, whisky tumblers and trench coats of Edinburgh’s Scotch Malt Whisky Society on Queen Street, the more central yet slightly less convivial of its two locales.

Seated opposite is Amanda Kremer, best described as the absolute singularity of workplace enthusiasm and the founder and managing director of Thrive for Business.

And a strange irony indeed that she, who runs what is arguably Scotland’s most successful pure networking organisation, was initially quite reticent about being interviewed by HNW magazine.

Twenty minutes into the conversation and we’re ensconced in a reveal of the business she’s built over the past six years, the continuous coal-face R&D approach and the blistering pace at which she began and has somehow, throughout, maintained.

If ever an individual had earned the right to hang ‘never stop improving’ above the door of her company it’s the rather diminutive entrepreneur eschewing the single malt option this evening for an obscure type of tea.

“When I look back,” says Amanda, “My first year was really good. No overheads, working in the house, essentially I was self-employed. I launched in 2005. No website, business cards, marketing or branding. It was just the phone and me.

“I used to call people to come along to a gathering, paying £10 at the door. I did it by tapping into my existing network and expanded it at every opportunity.

Being that close to the business was like operating ‘Thrive Live’ which meant I could see when the product was working and when it wasn’t.

“Then came the office move. Or so I thought. There was a verbal deal which fell through, followed by an interim

“

I quite literally broke the phone my first year in business. That’s how hard I worked – it tells you how much it takes to get there. arrangement. You learn as you go with some things. This is what business is.

“What I had decided at that point was Thrive needed to be in the centre of town in Edinburgh. If you’re RBS you can handle Gogarburn or the outskirts of the city. A smaller player ends up spending more money on taxis than rent. It’s a question of logistics and presence, just

”

like in networking.”

Amanda’s background was sales and relationship management and, just prior to launching Thrive, in IT support.

“I went to a lot of events. You learn quickly that SMEs don’t advertise, they network and then buy products and services from each other.

“

A friend of mine finally said to me: ‘Look Amanda, you’ve got to think of the business like a bus. You’ve got to get the bus, drive the bus, get the right people on the bus, then get the right people doing the right jobs on the bus, and then continually make sure the bus is headed the right way.

”

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AMBITION

“

HNW MAGAZINE JAN/FEB 2012

In business it’s never just one thing. Everything has a relationship to everything else – doing a lot of things together consistently.

“So when I went to events, I went to win business. And it was the same barriers every time I walked in - everyone standing in huddles. It’s hard to break in.

But it was there that I spotted the gap; lot’s of networking going on but no real training on how to do it. That was the kick start for Thrive. My Eureka moment.

“From that point on it was all about results driven networking and has been ever since. The challenge hasn’t been so much about trying to discover a new business focus, it’s the continual evolution of that core idea; keeping it fresh, engaging and valuable to businesses.”

Amanda soon discovered that necessity truly is the mother of invention and while growing industry specific ‘clubs’ she realised that once the categories were all eventually full it became the ‘same old, same old’.

“My heart sank at that revelation,” says Amanda, “the point where these regular gatherings became less and less interesting. What followed were declining attendee numbers. We needed a new focus. And that’s when the speakers came into place and it started to turn around.”

Her frankness is compelling as is the business’ post-Eureka moment response to a potentially debilitating, and likely industry-wide, problem.

“I think it’s the best way to launch a business is when you see your opening,

”

your opportunity. You find a niche, a gap, something you believe in, and you make it happen. Even if you have to break the phone to do it! And I still say that to my staff today.”

Amanda brought in an investor after the first year. She chose a relative, not an uncommon move, someone she knew and trusted and someone who believed in her and what she was doing.

“The investment provided a nice cushion,” she says. “It was then I wrote a proper business plan. But what I found was that no one could work to my expectations. My first employees were a steep learning curve, and I’ve paid more than my share of tuition since.

“When I became a real business, with overheads, staff et al, it was a real pain; hiring the wrong people, not training them properly, not inducting them the right way.

“A friend of mine finally said to me: ‘Look Amanda, you’ve got to think of the business like a bus. You’ve got to get the bus, drive the bus, get the right people on the bus, then get the right people doing the right jobs on the bus, and then continually make sure the bus is headed the right way.”

After 12 to 18 months in the ‘real business’ stage Amanda says she figured out the crucial KPI of matching ‘deal value and salary value’, as well as how to keep the members coming in.

“In business it’s never just one thing.

Everything has a relationship to everything else – doing a lot of things together consistently.

“We’re at a really exciting stage now in terms of sustainability and the absolute endgame of ensuring that this business is here for the long-term.”

So can Thrive for business still thrive and make money without Amanda Kremer?

“That’s my definition of a successful business.”

And what about 2012?

“With Thrive it’s all about new memberships and new networking products this year,” says Amanda. “Two new conferences, based on market research, will combine different event formats and in doing so ensure the best use of time and delegate-to-delegate engagement.

“We’re also working to remove the randomness from networking, as well as seeking to work more closely with longterm members and their companies in order to take ownership of other event programmes and activities.

“There’s a pilot a consultancy initiative on networking skills training in the university sector on the horizon too.”

I’m not giving in and return to my question; is there a Thrive for Business without Amanda Kremer?

“I jump out of bed in the morning.

That’s how I feel about going to work. But I am trying to make myself redundant from the business every day.

Watch this space.”

AMBITION 13

THE NETWORKS

HNW MAGAZINE JAN/FEB 2012

HNW magazine prizes its relationships with leading organisations in the entrepreneurial and investor sectors and is delighted to provide direct links and information to these organisations below.

ASAM – www.alansteel.com If the confusing messages in the financial media leave you not knowing which way to turn, and you want to reduce your risk and organise your future with more certainty, contact Alan Steel Asset Management’s award-winning team.

LINC – www.lincscot.co.uk The national association for business angels in Scotland, with a membership network of hundreds of investors including those operating individually, many of the best known groups and syndicates, and a number of significant private offices.

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WeDO – www.wedoscotland.co WeDO (We Develop Opportunities) is one of Scotland’s most exclusive collaboration organisations bringing together some of the country’s most successful and emerging high growth entrepreneurs to share knowledge, ideas and experiences.

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Footdown – www.footdown.com Mentoring. Insight. Coaching. Footdown is passionate about improving the performance and quality of leaders, and works from within a peer group to inspire, inform and help leaders respond better to all challenges.

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Scottish Social Enterprise Coalition – www.socialenterprisescotland.org.uk Social Enterprise Scotland is the national collective voice for social enterprise in Scotland, bringing together social enterprise and its supporters into a strong force for change.

Kiltr – www.kiltr.com Kiltr is a leading edge professional social network for everyone with a Scottish connection, founded with the local-to-international Scottish Diaspora at its centre.

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EMPLOYABILITY

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The Social Enterprise & Employability Marie Marin is no stranger to being in the spotlight.

The founding CEO of Employers For Childcare Charitable Group runs one of Northern Ireland’s most successful Social Enterprises and regularly promotes the concept.

BUT while the business model of addressing social or environmental need is one in which she feels entirely ‘at home’, the development and eventual success of the organisation was a challenging journey.

“The process of transformation was painful”, says Marin.

“We developed from being 100% grant dependent to being 100% self financing in just 4 years.

The Scenic Route “That might look very impressive, and I would love to say that I knew exactly what I was doing at every turn in the road, but that would be a lie.

“Rest assured if anyone ever took the scenic route to get from A to B, it was me!

“But all those long and winding detours proved invaluable in terms of our learning and most of all in terms of the mindset shift which was absolutely essential for me personally to go through.”

Social enterprises are businesses which exist to address social or environmental need. Rather than maximising profit for shareholders or owners, profits are reinvested into the community or back into the business.

Marie comes from a community and voluntary sector background, working with long term unemployed and women’s groups.

“Like so many others in our sector, I could fill in a funding application with my eyes closed. Furthermore like so many others, I thought profit was a dirty word. Years of reliance on public funding taught me nothing about enterprise”.

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So What Changed?

“I had a shocking conversation with the accountant in 2006 and I realised that without immediate revenue increase, the charity that I had devoted 8 years of my life to, just wouldn’t see another Christmas.”

Marie explains, “We address childcare as an economic and a labour market issue.

“Our charity provides free confidential services to parents, advising them on how to access and afford childcare.

screaming. I felt like an alien on another planet where everyone spoke a different language.”

Marie Marin goes on to describe one of many ‘defining moments’, when she was advised to employ a Telesales Executive.

“It took me 3 months to say that word out loud. I thought I can’t do that. We’re the third sector. We don’t employ sales people.”

“But thankfully I took the plunge and employed ‘Johnny’ our telesales person.

“Although two years earlier we had set up a Childcare Voucher business, whereby we administer a tax relief scheme which enables both employers and employees to save money - and through which we generate income - at that stage we simply weren’t ‘selling’ enough to meet our expenditure.”

“Today we have a team of Johnnies and I can quote our profit margin, annual turnover and marketing strategy with my eyes closed.

Marie realised the organisation had to do something drastic.

Marie Marin is the founding CEO of Employers For Childcare Charitable Group, one of Northern Ireland’s most successful Social Enterprises.

“We had already built up an excellent reputation with local companies, so I emailed them asking for senior executives to help us become more business focused.

“The response was overwhelming. I ended up in the bizarre position of interviewing and selecting Managing Directors and Accountants as new Board members.”

Marie describes the months that followed as difficult.

“I felt completely out of my comfort zone.

They grilled me on our profit margin, sales conversion rates, annual turnover and marketing strategy.

“I just smiled sweetly and said I’ll get back to you on that. Inside my brain was

“Today I think profit is a lovely word… it’s what you do with it that makes the difference.”

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FEATURE REPORT

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Predictions & Positions There’s an old English proverb; “An empty can makes the most noise’, describing people that talk too much as compensating for a lack of knowledge.

To the herd that noise can be a powerful aphrodisiac, turning one misinformed opinion into a wholesale self-fulfilling financial prophecy.

Stock markets are driven by mass sentiment; our communal need to fill up empty space with conclusions that either settle or corroborate fear.

Ruminating on noise, particularly media noise has far reaching implications.

And in the period following a global recession the herd is exponentially more sensitive to both empty cans rattling with unfounded opinion, and the considered views of those with a vested interest.

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We should think of the daily musings of the dead tree press and announcements of impending calamity as space fillers, like bad music that plays while you’re on hold, late night infomercials and even the fifth series of The Sopranos.

We need to look beneath the lid; to adopt the Latin phrase Nullius in Verba as economic gospel; “take no one’s word for it”.

Nullius in Verba is the motto of the Royal Society of London - mantra to the fellowship of many of the world’s most distinguished scientists - inspiring the need to regularly question and test understandings and conclusions.

And as we travel down the road through 2012 I can think of no better roadmap to navigate the obvious proliferation of ‘in Verba’ out there and distinct lack of ‘Nullius’.

The Five Little PIIGS Last year we heard the oft-repeated bad fairy tail of the “Five Little PIIGS” (Portugal, Italy, Ireland, Greece and Spain). Their respective Eurozone financial non-compliance and accumulated debt mountains were presumed to derail the rebounding global economy.

But that’s just noise. Those who believe

FEATURE REPORT

HNW MAGAZINE JAN/FEB 2012

that Greece, whose GDP is less than the US state of Florida, can singlehandedly alter the planet be now calm. All the PIIGS together represent less than 4% of global GDP, not good news if they all default but hardly meriting Armageddon.

on the street who are sold bad news at every corner shop is about as reliable as using a blindfold and a dart board.

China

The Eurozone

Should our children learn as China takes over the world?

The Eurozone is a patchwork of political authorities attempting to house divergent geographies and histories under one roof.

China reminds me of Japan in the 80’s. Same idea; that our youth adopt hy_jungo the lingua franca of Japan as it would soon rise to control the world.

That one didn’t quite work out.

Consider that the wheels are already starting to come off China’s wagon as central authorities had to recently bail out the country’s largest banks in 2011.

Reckless banking is not just the domain of western society, and doesn’t bode well for impending world domination.

Entrepreneurs Even the entrepreneurs have gone missing according to the revered Global Entrepreneurship Monitor (GEM) Report – an apparent ‘Lost Generation’.

Seems we forgot that start-ups are up at their highest levels since 2003 and comprise an enormous list of new wealth creators, albeit a less visible group due to a lack of company exists.

Still, it’s not quite time to file a missing persons report.

But financial markets malaise, short-termism and the search for entrepreneurs were not the only issue restricting our views.

Employment Disappointing employment numbers have become a mainstay over the past four years.

But how do we arrive at these in the UK? Do they not just pull them from Job Centres?

Nope.

‘They’ interview about 7,000 folks a month randomly and extrapolate to the population. No kidding!

Not exactly an accurate assessment of a perceived problem? Surveying folks

Subsequent employment headlines augur self-fulfilling prophecies of gloom.

Following WWII, European economic and political integration made sense via the USA’s Bretton Woods agreement that crafted an economic grouping to regenerate Western Europe’s economic fortunes.

Thereafter the need to remain united was at least twice underpinned; first after the US abandoned the Gold standard in 1971, and thereafter during the spectre of a unified Germany in 1989.

The failure to police these standards has resulted in Greece’s (and others) violations of the Growth and Stability Pact – perhaps the most egregious, and France and Germany, who helped draft the Pact, contravening the rules since the beginning.

Rules and logic would suggest simply getting rid of the offenders, except that the Euro-authors decided that expulsion or self-imposed exit is technically illegal.

Blackadder We decided to draft in our resident expert Blackadder, and his quizzical assistant Baldrick, to help explain the problem in a more coherent and understandable way: Baldrick: “What I want to know Sir, is before there was a Euro there were lots of different types of money that different people used.

And now there’s one type of money that the foreign people use. And what I want to know is, how did we get from one state of affairs to the other state of affairs.”

Blackadder: “Baldrick. Do you mean, how did the Euro start?”

Baldrick: “Yes Sir”

Blackadder: “Well, you see Baldrick, back in the 1980_s there were many different countries all running their own finances and using different types of money.

On one side you had the major economies of France, Belgium, Holland and Germany, and on the other, the weaker nations of Spain, Greece, Ireland, Italy and Portugal.

They got together and decided that it would be much easier for everyone if they could all use the same money, have one Central Bank, and belong to one large club where everyone would be happy.

This meant that there could never be a situation whereby financial meltdown would lead to social unrest, wars and crises”.

Baldrick: “But, this is sort of a crisis, isn’t it Sir?” Blackadder: “That’s right Baldrick. You see, there was only one slight flaw with The Plan”.

Baldrick: “What was that then Sir?” Blackadder: “It was bollocks!”

Small Business Ralph Waldo Emerson wrote ‘What lies behind you and what lies in front of you are tiny matters in comparison to what lies inside of you’.

Is it surprising that 8 out of 10 small company owners see their businesses growing in 2012?

It shouldn’t be.

Some 14% of this group is beginning to trade internationally and according to research of 1,000 SMEs carried out by HSBC. The UK needs job creation and that won’t come from bank funded support this year, certainly not in any significant increase over the last two years.

Big Business What’s more shocking than the Mayans prophesying the world will end in 2012? That London continues to lead continental European IPO activity.

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FEATURE REPORT

Research from accountancy firm PricewaterhouseCoopers (PwC) revealed that Q4 of 2011 saw 78 IPOs raise €866 million (£714 million), a dramatic 83 per cent decline year-on-year.

London dominated activity raising €800 million or 92% of total European IPO value.

It would be easy then to assume an IPO drought but annual European IPOs raised €26.5 billion, in line with 2010 – with London generating a total of €14.6 billion, more than half of money raised, from a quarter of all IPO deals across Europe.

In the US mega deals meant that the first half of the year raised €25.6 billion in 2011, a 13.4 per cent decrease on 2010, and largely attributable to the IPO of General Motors.

The Angels The new Seed Enterprise Investment Scheme (SEIS), commencing from April 2012, will encourage investment into new early stage companies.

This is the ‘BASIS’ proposal that was set out in the consultation carried out earlier this year. SEIS will: - Be similar to the current Enterprise Investment Scheme (EIS) but will focus on new early stage companies. .

- Provide income tax relief of 50% for individuals who invest in shares in qualifying seed companies.

- Eligible companies will need to have 25 or fewer employees and assets of up to £200,000.

- The Chancellor announced a one year CGT exemption for any gains made on the disposal of assets in 2012-13, and then invested through SEIS in the same year.

Counting the New Wealth Creators We don’t actually know how many start-ups there are every year. VAT/ PAYE registrations are the most reliable official indicator of business startups but they exclude the small and incubator stage businesses.

Within those parameters start up rates in Scotland and Wales appear equal at a dismal 34 registrations per 10,000 of the adult population as far back as 2009.

The UK figure is 47 start-ups per 10,000.

According to the Committee of Scottish

HNW MAGAZINE JAN/FEB 2012

Clearing Banks 2010 recorded 15,439 start ups, slightly down from 15,726 in 2009, but once again available information excludes several major banks including Barclays, Santander, Cooperative Bank and HSBC – two of which are considered active in the start-up community.

The Business Gateway claimed assistance with 11,242 businesses to the end of March – the highest figure on record since Business Gateway was set up in 2003.

GEM research, which is essentially an annual opinion poll of national entrepreneurial levels, incorporates 59 economies worldwide and over 180,000 individual interviews measuring entrepreneurial activity, attitudes and aspirations.

The most recent survey found Scotland’s total early stage entrepreneurial activity or TEA rate comprising nascent entrepreneurs and new business owners was 3.7 per cent of the working population against 5.6 per cent for the UK. The Welsh Youth Entrepreneurship Strategy (YES), launched in 2004 is now the benchmark as it sees more young people in Wales now want to set up their own businesses.

Scotland’s Determined to Succeed programme focusing first on primary and then secondary schools over the past decade has been funded to motivate students to think about setting up their own businesses.

The results have been disappointing, even in further education colleges.

That said Wales and Scotland are statistically still very similar.

USA US GDP in the US last quarter reached $15.180 trillion or roughly $3.75 Trillion a quarter.

Some numbers we lost in the mess - US manufacturing is actually making a comeback with output and exports setting several new highs in 2011 - The manufacturing benefit spreads between China and the US are shrinking rapidly, and the world is taking notice.

- China’s lower numbers in recent months are not just related to their previous money tightening policies, we will see that in a few more quarters.

- Magicians make their money by slight of hand and China’s public statements over the next 12 to 18 months will work hard to do the same.

- Corporate profits, cash flows and balance sheet health all ended the year at new highs.

- Disney had to close its gates during the Holiday break after attendance limits were reached (for only the second time in the Disney World’s history).

- US jobless claims fell into territories not seen in many years.

The bad side is always much easier to believe. It’s sexier, sells more newspapers and spikes adrenaline. It’s also an empty can making more noise than the facts.

Nullius in Verba.

However, individual education facilities run their own programmes, like Heriot-Watt University’s Converge Challenge where potential entrepreneurs from across Scotland get the opportunity to develop and pitch their ideas.

Similarly, the Prince’s Scottish Youth Business Trust funded 646 young people in 611 businesses and Ernst & Young’s renowned Entrepreneur of the Year award has for 13 years had little difficulty finding new blood.

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helen.brown@barnardos.org.uk 0131 559 3940 HnW MAGAZINE aUGUsT 2011

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ECONOMY & INTERNATIONAL

HNW MAGAZINE JAN/FEB 2012

International Focus on...

Ireland Bad news is easy to lump together, to pile up and point at, wax dismissive about and from that altar preach a dissuasive mindset.

THE Republic of Ireland (RoI) is a haven for this type of ‘red ink’; the record setting unemployment figures, banking scandals, a property bubble that spectacularly burst, the fall of the ruling Fianna Fáil party, distant echoes of 100,000 protesters on the streets of Dublin back in 2009, and an Irish Stock Exchange - once the 10,000 point darling of 2007 - now meandering at a 14-year low in the 2,000 range.

Sweet Molly Malone, wherefore art thou Celtic Tiger Economy?

But what’s this about Ireland being on track to meet its fiscal targets according to the EU and IMF review? A deficit that beat expectations in its reduction to 10% of GDP and, with a tough 2012 budget unveiled, an expected further reduction to 8.7%.

That’s not to say that higher taxes won’t damage disposable income and help increase outward migration, but of the ‘big five’ uber-indebted Eurozone countries, Ireland has been the most successful in the path to economic recovery so far.

Additionally the Government’s debt swap deal will help ease the burden of a Euro 11.8 billion debt redemption scheduled for January 2014.

Now that may not exactly silence the doomsters but there are notable positives beyond the negative headlines.

Certainly the common language, geography, legal and regulatory frameworks have helped Ireland remain the UK’s fifth largest export market – that equates to £42 billion worth of trade between the two countries every year, or 6% of total UK exports.

In fact Ireland ranks first in certain sectors such as food & drink, clothing, fashion & footwear, and the UK exports more to Ireland than to Brazil, Russia, India and China (the BRIC economies) combined.

And throughout the heralded 2008-2012 recession, year-on-year exports between the two countries have continued to rise.

Suffice to say that Ireland ‘emerged’ from recession in early 2010 and predicted positive GDP growth for 2011 despite high unemployment and some contracting industry sectors.

This was evidenced by growth areas across the ICT, Pharmaceutical, Life Sciences and Agri-food industries as Ireland plays home to a large variety of these multinationals, many of who have their European HQs in Eire.

In fact nine of the top ten global pharmaceutical companies are located in Ireland, alongside seven of the top ten global ICT companies including GSK, Dell, Microsoft, Accenture, Google, HP and Pfizer.

Tax priorities have also changed according the ESRI (Economic and Social Research Institute). While it was the highest earners who took the biggest hit from Irish austerity budgets early on, Budget 2012 has turned toward those on the lowest incomes.

And thus the now well established ‘two speed’ Irish economy; on the one hand exports are expected to grow with rising global demand as the domestic economy struggles in the face of public spending cuts, alongside weakness in the construction sector and pressures on consumer spending.

To say the outlook is more of the same would be fair; interest rates will edge up against rebounding French and German economies, unemployment will rise albeit more slowly as outward migration increases.

But there is there is hope that continuing global demand for Irish goods will drive a rebalancing of the general economy and the jobs market faster than the current glacial-pace.

The message here is not to be too dismissive, for within the bleakest periods often wait the best investment opportunities.

Outside the congregation of negative sentiment Ireland just might represent an opportunity that many will regret not considering in years to come.

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MIKE FROM MANHATTAN

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MIKE WILLIAMS: THE VIEW FROM MANHATTAN... for 2012 All glasses we wear are tinted. They are tinted by what we think. And so we must be clever in our thinking.

IN the words of my good friend Alan Steel in Linlithgow, Scotland “Nullius in Verba” which loosely translated means ‘take no one’s word for it’.

higher profit-producing platforms. If we stand by and wait until those futures are “clear”, we have completely missed the benefits created by the dark times.”

Why? Because it’s easy to hear, read, ingest and promulgate bad news. That bad news creates a negative herd mentality followed by self-fulfilling prophecies of recession, investment reticence and ultimately future remorse when they get it wrong.

So what should we as investors and entrepreneurs focus on over the next 10 years:

There’s always going to be an epidemic to fear to cling to, a China syndrome to consider, a Eurozone debacle, and all endorsed by the daily “dead tree press” utterances of doom & gloom.

Fear is a powerful commodity upon which many businesses trade.

2012 And The Next Decade Most of the greatest investments ever made over our lifetimes have come in dark times - new tools, better technologies, more productivity and higher profit-producing platforms.

If we stand by and wait until those futures are “clear”, we have completely missed the benefits created by difficult times.

It always works that way Today, the Euro is hitting 18-month lows in values, gold is 20% off its recent high and the Dollar, well, the Dollar is breaking out and will rally because the US is improving more than most understand.

“Most of the greatest investments ever made over our lifetimes have come in dark times - new tools, better technologies, more productivity and

1) Look to equity exposure, because everyone hates stocks right now and the crowd is selling left and right. Even Buffett is buying tech stocks (IBM).

2) Buy, own, or rehabilitate and rent real estate. Why? Because no one wants it, rates are at record lows, it is very tough to do deals and opportunity is always wrapped in things that appear tough.

3) Start and own private businesses, preferably online businesses if you can, and those that are Internet-based where possible. Application or appgenerating businesses are icing on the cake.

Get The Facts, Not The News Making money over time means learning to simply ignore most of what is going on in the news. By example, what the news won’t tell you just now is: • Profits in the US have never been higher as we close the books on a volatile 2011.

• Margins and productivity forces have never been more beneficial to the bottom line.

“

• Debt restructurings have never been more opportunistic as 30-year auction levels hit new low rates.

• Companies are improving already robust balance sheets by the quarter.

• Markets are priced at roughly 12 times trailing earnings - nearly 11 times next year’s and far below that in many misperceived cases.

• T-bills turned negative, meaning investors are paying the U.S. government for the privilege of borrowing their money.

• In the first 10 months of 2011 stock funds squeaked out a $4 billion net inflow, while fixed income-focused managers collected a monster $86 billion.

In Summary We have spent the last 5 months reacting, repairing and gaining balance.

We have been jousting with the massive fears created by those 6 short trading days that kicked off August 2011.

All wealth is created by taking risk. Most wealth is extracted from dark moments in time and we are staring into the abyss.

Grab your tinted glasses and let’s get moving.

Mike Williams is President of Genesis Asset Management in Manhattan, New York.

Most of the greatest investments ever made over our lifetimes have come in dark times - new tools, better technologies, more productivity and higher profit-producing platforms. If we stand by and wait until those futures are “clear”, we have completely missed the benefits created by the dark times.

”

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Technology Waves and the Hypernet

A few weeks ago, I had the chance to go surfing off the coast of Waikiki.

The waves there are perfect because they are just the right temperature and they are forgiving enough that I can get up on the board and have a great time, despite being pretty out-of-shape.

I have always been inspired by the metaphor of surfing.

On one hand, you are out in the ocean, paddling as hard as you can until you find the next wave.

It’s up to you to pick the right one and control yourself and the board the best you can as you ride the wave into the shore.

But there is also something vastly larger and more dynamic at work because

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every time you get up, the entire power of the ocean is behind you.

Some waves are too small to be interesting. Some (like the PC revolution, client/server, the Internet, and social networking) are so big that they spawn entire new industries and companies that change the world.

And that awesome power makes the entire experience possible.

Waves in the Technology Business The metaphor of surfing has guided my framework for thinking about the tech business ever since I was writing programs for the Apple II and the original IBM PC in Junior High, and later as an entrepreneur and now as an investor.

In the digital world, rather than the forces of gravity and the tides and the water itself, the motive power comes from exponential technology factors

such as Moore’s Law (which doubles the performance of computing every 18 months), as well as storage (which advances even faster), and networking connectivity (which is slightly slower).

Because of these powerful forces, new waves gather in the tech business all of the time.

Some waves are too small to be interesting. Some (like the PC revolution, client/server, the Internet, and social networking) are so big that they spawn entire new industries and companies that change the world.

These waves guarantee that there will always be a new supply of innovative companies who push the technology industry forward.

Technology Waves: Overview In my experience, every decade or so, we see a major new tech wave.

“

Some waves are too small to be interesting. Some (like the PC revolution, client/server, the Internet, and social networking) are so big that they spawn entire new industries and companies that change the world.

”

SPECIAL REPORT

HNW MAGAZINE JAN/FEB 2012

Today we are at the mass adoption phase of the social networking wave.

We have observed that these waves tend to follow a pattern.

They start with infrastructure.

Advances in infrastructure are the preliminary forces that enable a large wave to gather.

As the wave begins to gather, enabling technologies and platforms create the basis for new types of applications that cause a gathering wave to achieve massive penetration and customer adoption.

Eventually, these waves crest and subside, making way for the next gathering wave to take shape.

We have observed that these waves tend to follow a pattern. They start with infrastructure. Advances in infrastructure are the preliminary forces that enable a large wave to gather.

A similar story could be told for every wave back to the PC revolution (which incidentally had infrastructure such as semiconductors and disk drives, enablers such as DOS, PostScript, and NetWare, and apps like Microsoft Office).

The Importance of Enabling Technologies Another interesting feature of most tech waves has been that the enablers (Microsoft with DOS in PCs, Oracle with Relational Databases in client/server, Facebook with the social graph) have

Technology Waves

Applications

Infrastructure

Enabling tech/ platforms

Note: Enablers (1) leverage new infrastructure innovation and (2) make it possible for apps to take it to mainstream audiences.

In the recent social networking wave, broadband penetration created the infrastructure for billions of people to be always connected.

Next came the enabling platforms from companies like Facebook, Twitter, and LinkedIn, who created the various types of social graphs and connection frameworks for people to socialize.

This was followed by applications such as Zynga that took advantage of these underlying platforms and connections, along with business software companies like Bazaarvoice and Jive.

What It Means for Entrepreneurs and Investors One of the other features of this metaphor that I like is that it provides a good framework for investors and entrepreneurs.

In Silicon Valley in 2005 many VCs were saying that consumer internet companies made no sense – that the dotcom bust proved that “you can’t make money with just a lot of eyeballs.”

But what this analysis missed was that we were in the beginning phases of a new wave called Social Networking.

The Internet wave had crested and a new wave was gathering. Twitter turned out to be one of the key winners in the enabling technology/platform phase.

By 2006 applications leveraging the connections created by Facebook, LinkedIn and Twitter included Bazaarvoice, BranchOut, Chegg, MassRelevance, Modcloth, Socialware, Spiceworks, and many others. During this period of time, we saw many “Facebookkillers” or “Twitter-clones” or “LinkedIn for another segment” types of companies.

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2

massively valuable.

turned out to be natural monopolies.

They appear just as the early infrastructure has been built and create a way to translate the new capabilities into a platform for applications that eventually reach very large audiences.

Enablers are the special companies that convert the energy of a gathering wave into the opportunity for a new set of technologies to affect millions or even billions of people.

There are very few companies that end up playing this critical enabling role, but the companies that win end up being

Why It’s Too Late to Start a Meaningful Social Networking Company When the cycle started to move from enablers to applications, it was a very good time for two reasons.

First, it was late enough that companies could make a bet on a few platforms that had achieved scale and were likely to achieve much greater scale.

The Internet wave had crested and a new wave was gathering. Twitter turned out to be one of the key winners in the enabling technology/ platform phase.

But, it was also early enough that the map of the world had yet to be drawn for apps.

This meant that companies could acquire users for much less money and monetize them better because there was less competition.

These companies also had the opportunity to build network effects among their users and create sizable entry barriers, particularly in terms of scale and distribution strength.

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But the social networking application space is now very crowded.

The wave is about to crest. There is more competition for users which means that the costs of acquiring users is increasing while the lifetime value of users for new products is under more pressure - a natural part of how a tech wave evolves.

In the early days, there are very few “surfers.” There is plenty of room for everyone.

But pretty soon, lots of people crowd to the same beaches and it’s just not the same.

Anyone who surfs during a busy time in Santa Cruz has probably experienced a crowd of angry surfers acting territorial and saying “dude – get off my wave.”

That’s what life is going to be like for new social networking start-ups going forward.

But don’t misinterpret this point. Social networking is not “dead” and we’re not in a “bubble”.

Social networking will matter for sure in the future. But entrepreneurs from this point on should look at it as a “feature” rather than the next great start-up opportunity.

Enter the Hypernet (WiFi) In the last few years, the new infrastructure has been put into place for a major new wave.

It combines the web plus cellular plus WiFi (which we call the Hypernet), along with potential new user experiences that involve billions of nodes and millions of clouds (which we call the Hyperweb).

And a handful of entrepreneurs will begin to build the enabling platforms that define some of the great technology companies of tomorrow.

Will it be bigger than social networking?

You bet it will, and mainly because it has a larger hardware component to it which make for even larger ripple effects and the value multipliers are even stronger.

Key Takeaways Technology waves are a powerful framework for entrepreneurs and seed investors who wish to start or invest in companies that have a chance to be extraordinarily valuable.

Technology waves evolve along a pattern, starting with infrastructure, moving to enabling technologies, and

then kicking off a phase of applications that take the wave to mass adoption.

The key is to recognize what phase of the wave you are in and align your start-up or investment strategy with reality.

The enabling technologies and platforms that win are natural monopolies.

Applications build on the enabling technologies and platforms that consolidate and take the technology of a new tech wave to he masses.

The applications companies that win are those which wait long enough to make the right platform bets, but enter early enough that the map of the future is yet to be drawn.

Social networking is the current Tech Wave, but it is shifting from a new cycle where there are opportunities to build big start-ups, to a mass-adoption phase where social networking is now a “feature” rather than uncharted territory.

If social networking can be thought of as a part of the ocean that is crowded with surfers, the Hypernet and Hyperweb is the opposite.

Right now there are very few paddling in that water and right now there’s room for a lot more people.

Will it be bigger than social networking?

You bet it will, and mainly because it has a larger hardware component to it which make for even larger ripple effects and the value multipliers are even stronger.

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LEADERSHIP

HNW MAGAZINE JAN/FEB 2012

Good vs Bad Leadership = 15% Swing In Business Profitability Ros Taylor

Once upon a time not so long ago a man named Howard Shultz, CEO of Starbucks, followed his appetite to try new things and installed ice cream makers in his US shops.

AFTER monitoring sales he discovered the customers didn’t like the ice cream, at least not enough, and after just a few weeks he pulled it.

Shultz, who had taken a handful of locations in 1985 to over 3,300, and developed sales of over $2 billion by 2000 before handing over the reigns to new CEO Orin Smith, referred to the ice cream saga as a ‘fast failure’.

ever achieved in psychology…that a leader’s behaviour influences an organisation’s profitability by 15%; up 15% if a skilled leader down if a bad one (British Psychological Society Magazine, September 2009).

How solid are the results? The predictability is twice that of Viagra (and its obvious effects) and four times that of Ibuprofen on a headache.

Still hungry he moved on to his instant coffee idea, which is set to make him $1 billion.

It’s incredible how profoundly one bad leader can affect the performance of a top team.

It’s a key lesson in leadership, that positive thinking is very different from wishful thinking.

The Top 3 Leadership Skills

Hard Times & the Hirsh Study Leadership skills are of importance at all times but are paramount during difficult ones. In full view of the new year how will leadership help companies negotiate the expected economic turbulence of 2012?

A renowned study by Jacob Hirsh of Toronto University revealed the true impact of a leader’s behaviour on his/her team, department or organisation.

And it should be noted that Hirsh’s result delivered the highest correlations

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Skilled leadership is not just a ‘nice to have’ element of a business but an essential for improved performance, especially at the moment.

So what are the top 3 leadership skills for 2012?

Be Optimistic: Find a way to remain optimistic. Nobody wants to be a follower of the cynical and depressed.

As leaders we need to pursue positively what works in our businesses while swiftly cutting back on what doesn’t.

Monitoring sales and staff performance is even more of an essential in 2012 as we all have to do more with less.

And it should be noted that Hirsh’s result delivered the highest correlations ever achieved in psychology…that a leader’s behaviour influences an organisation’s profitability by 15%; up 15% if a skilled leader down if a bad one.

Be People Focused: Work at being relaxed. When we are stressed we tend to eat badly, sleep poorly and become irritable with those around us just when we need their cooperation. When we are anxious it is all about us and our selfish agenda whereas good leadership is all about others and where we can take them. When we relax the posterior part of the brain is activated which focuses on other people. A leadership essential!

Be Contrarian: Do things differently.

Involve staff or even clients to come up with ideas that can help the delivery of services or products in a unique way.

2012 is no time for the outdated. So many companies still imagine ideas and strategy should emanate from the top without realising that everyone involved in the business will have a view.

It’s sometimes the young trainee who comes up with new ways to improve the product or service line and saves the company millions.

CLIENT SERVICE

HNW MAGAZINE JAN/FEB 2012

The Client Service Factor John Kennedy

Perhaps Forbes magazine’s recent article Why Customer Service Is The New Marketing 28th December 2012 provided this year’s gauntlet for delivering increased value in the business-to-business/consumer relationship: “…Treat your customers as if they were newspapers reporters; this is the new mantra for savvy companies of all sizes. As consumers, we’ve become disenchanted with advertising and marketing of all sorts, having being duped, tricked or made to feel foolish on more than one occasion…”

WE all appreciate great service in both our personal lives and our business lives so why is great service such a rare commodity?

This is still true even in an economy where clients are harder to find than ever.

Periodically, business experts focus and comment on ‘service standards’, that unwieldy gray area of refined and renewed pleasantries gleaned from client perspectives that all too often come unglued by the phrase: “We need to do more”.

And thus, delivering excellent client service is often promised by many organisations but the reality, as we all know from our interactions with many organisations, can be very different.

The barriers that need to be addressed in order to create a customer service culture must be understood on two levels: Individual Factors Supplying a ‘technically’ competent service is no longer the differentiating factor that it was in the past.

We probably all have technically competent competitors who could supply a service of the same type as we do, even if we are reluctant to analyse ourselves in such a fashion; confirmation bias is tantamount to client attrition and subsequently, profit loss.

Our clients are very often making their purchasing decisions based on other factors not directly related to our real or perceived technical genius.

If we are deemed as specialists, experts or leading practitioners in our fields we inevitably consider our reputation to automatically bear acknowledgement of how wonderful we are in our jobs.

Though many professionals train in very specific fields for many years their client service and business skills are often secondary, and indeed may be regarded as less relevant to their roles.

That error of omission arrives in understanding and engaging with customers; where business is built, thrives and overcomes those competitors still suffering from their own confirmation bias.

Take the lesson that while we often build our organisations around delivering core skills, lest we not forget to focus on what

the client and the market may actually need.

Organisational Factors Delivering high levels of client service is an organisational challenge for many reasons.

The culture of your entire organisation must be as client focused as possible with everyone at every level understanding the value of each client interaction.

Easy said, difficult done.

The challenges are significant because our organisational systems often evolve to help internal efficiencies and not to deliver value to our clients.

Our own mindsets focus on the technical aspects of what we are doing more than the service that the client is experiencing.

Reward systems are then geared directly towards revenue in the short term rather than the lifetime value of the client over a longer period, that which actually drives profitability and growth.

The Benefits of Delivering A Great Service Great client service is rare.

It is therefore one of the clearest competitive advantages in any business sector.

To develop a position as a client service leader is definitely a challenge for you, your people and indeed all your systems.

The results however can be spectacular across client retention, profitability and staff motivation – only those crucial elements of business performance and survival!

John Kennedy, john@b4-business.com

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PRACTICAL BUSINESS

Practical Business HNW Magazine’s Practical Business section looks at key areas of business needs across legal, accountancy, marketing, finance, property, strategy development and other key areas of support. In this issue we look at; how tech advancements have enabled mobile users to migrate tasks traditionally tied to the PC, how confirmation bias in the legal sector is distorting some perceptions of professional services in the modern era, and how research has identified the contributing and causal factors in business failure.

ACCOUNTANCY: The Philosophy of Business Failure

LEGAL: The Law of Confirmation Bias

TECHNOLOGY: Tech Plateaus in 2012

Research has revealed the causes of business failure arrive in both a major and a minor key.

Looking for evidence that we’re right; or that things are the way we believe they should be.

The new wave of technology has disrupted the way we work and play beyond all recognition.

ACCOUNTANCY

HNW MAGAZINE JAN/FEB 2012

The Philosophy of Business Failure

“A man who has committed a mistake and doesn’t correct it is committing another mistake.”

Confucius, Chinese Philosopher

OK, admittedly the 20th-21st century fortune-cookie version of Chinese philosopher Confucius’ teachings, taken entirely out of context, does him and other ‘special wise men’ of ancient cultures - Aristotle, Solomon, Pythagoras, Plato – little by way of social, political or literary justice.

But Confucius’ quote does resonate in the context of learning through failure to ultimately achieve success.

So consider the opening paragraph above like an apology in the true Socratic sense; the preamble to an explanation before the hemlock of poor financial strategy takes hold of a company’s final gasping breath.

Timely as well. It is the turn of the year when we consider such things; strategy and tactics, mistakes and the machinations of change to correct them, all in full view of an infantile 2012 as we ponder the annum’s likely heroes and forthcoming failures.

All too often a company’s financial management occurs like a rank amateur placing a bet on the Grand National at Aintree; close your eyes and point to a pony.

Research from a variety of sources over the last 3 years post credit crunch 08’ has gone some way to identify the causes of business failure. And they arrive in both a major and a minor key: • The Minors or secondary causes which don’t cause business failure but contribute to it.

• The Majors or core business reasons which do and will lead to failure The Minor Causes of Business Failure: 1) Increasing raw material costs.

2) Big (IT) projects out of control.

3) Failure to communicate business goals & objectives.

4) High cost structure compared to competitors.

5) Poor quality management (financial) information.

If any or several of the above look strikingly similar to what’s going on in your own business or organization at present, worry, but know that none of the foregoing cause business failure in their own right.

However, they will contribute towards it.

And with such a bunched field and high dangerous fences to jump who knows who will succeed the hurdles and who will fall down.

Symptomatic of being an Accountant is the recognition that poor financial information is particularly galling, as it is avoidable with only a small amount of investment.

The fact is in business, unlike Aintree, you can make a good attempt at predicting the fallers.

Still further baffling is the number of times you meet new clients and they really haven’t got a clue what’s going on

Meanwhile, cash remains king; king of pain in some instances and the number one reason for business failure.

in their business and/or market.

The Major Causes of Business Failure 1) Over reliance on a few key customers 2) Changes in market demand 3) Poor management, procrastination and non decision-making 4) Overtrading 5) Failure to collect debtors The first 2 causes above are clearly linked to falling sales but they are essentially the problem of poor and unresponsive management (cause 3 above) and non decision-making.

Overtrading is one of the most common causes of business failure. But it is equally difficult to control when sales increases are tantamount to more cash being sucked into stock and debtors.

Meanwhile, cash remains king; king of pain in some instances and the number one reason for business failure.

And if you know the philosophy for failure you can then reckon that which brings success: • Decisive management who know their markets and competitors.

• Leaders who use accurate, comprehensive management information.

• A loyal, growing customer base.

• Tight cash controls.

If as Einstein or (arguably) author Rita Mae Brown wrote that insanity is: “doing the same thing over and over and expecting a different result” then change in the face of failure arrives as the best strategy, a dose of sanity, and a business philosophy for success.

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LEGAL

HNW MAGAZINE JAN/FEB 2012

The Law of Confirmation Bias Richard is the managing partner of a medium sized law firm.

He’s also the largest equity partner and when the accounts are published and they show the largest pay out, it’s Richard who gets that money.

NOW I know Richard reasonably well, we never walk past each other in the street without stopping to chat and we’ve had a few coffees together and a discussion about the whole legal services situation.

I always ask how he is getting on and how his firm is getting on and he always exudes positivity. Things are great, they’ve merged ( err...taken over) a few

other firms and are “well placed to meet the challenges that the coming changes might bring”.

Or so he says.

The firm Richard manages is a Limited Liability Partnership (LLP) so the accounts are available online.

But what’s odd is not only does Richard say everything is alright, I think he actually believes it’s alright…the psychological term for this is “confirmation bias”, where we look for evidence that we are right; or that things are the way we believe they should be.

I’ve looked. In fact the last few years’ accounts are available online and I have them.

The unfortunate thing is that although this makes Richard feel better it means that his behaviour is worse.

From what I can see, Richard is taking home nearly 40% less now than he was 5 years ago. Turnover is £2m down and I know for a fact that his staff have taken pay cuts, some have left.

Like a rabbit caught in the headlamps, he is looking at the wrong thing and worse still, he’s not moving out of the way because he’s only focussing on evidence that confirms his position.

But what’s odd is not only does Richard say everything is alright, I think he actually believes it’s alright… the psychological term for this is “confirmation bias”, where we look for evidence that we are right; or that things are the way we believe they should be.

He tells me that social media is a fad, twitter is a waste of time ( “I don’t want to know what you had for breakfast!”) blogging is ridiculous, online documents will never work, we don’t need to spend money on marketing, we don’t need to take credit cards and so on.

And they’re not hiring.

I’ve also done a bit of secret customer work, not exclusive to Richard’s firm, and called up posing as a customer looking for legal services.

He looks around his office and sees busy employees, the court department is buzzing (it has to, it’s holding up the rest of the firm!) and all the clients they inherited from the “mergers” has boosted their list of customers.

They never called me back.

WIP remains strong.

But then again, neither did 7 of the 12 firms I called, so nothing unusual there.

So, what’s the problem?

But what’s odd is not only does Richard say everything is alright, I think he actually believes it’s alright.

There is even a psychological term for this called “confirmation bias”. It’s where we look for evidence that we are right; or that things are the way we believe they should be.

Like a rabbit caught in the headlamps, he is looking at the wrong thing and worse

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still, he’s not moving out of the way because he’s only focussing on evidence that confirms his position.

Bias is stronger for emotionally charged issues and deeply entrenched beliefs and I know from my conversations with Richard that the issue of Alternative Business Structures is an emotionally charged one.

I asked Richard how he could sustain a 40% drop in income.

He denied any such thing despite my logging in to Companies House to show him how I knew.

Then he went on to tell me that he no longer had any school fees to pay, so his disposable income had actually gone up.

Well, I guess that’s ok then.

Ray McLennan

TECHNOLOGY

HNW MAGAZINE JAN/FEB 2012

Tech Plateaus in 2012 “The pace of development of mobile devices, networks and applications has been breathtaking in recent years but signs are that this is slowing.”

THE last 5 years has seen the biggest shift in business and personal computing in a generation. The new wave of technology has disrupted the way we work and play beyond all recognition.

10 years ago, it was inconceivable that Microsoft would ever succumb to threats from credible competitors, particularly in the workplace, but we now have a 3 horse race for the hearts, minds and currency of end users with Apple and Google making significant inroads in to Microsoft’s traditional stronghold.

The key to this transformation is the rise of the mobile device. Major advancements in the hardware, communications and cloud services have enabled users to migrate tasks traditionally tied to the PC to their device of choice and, critically, to perform these tasks while on the move.

There is balance to strike between providing the access users want, securing digital assets and maintaining standards of service.

Those of us with teenagers are well aware that the next generation of the workforce is not going to be reliant on the Windows PC as the “be all and end all” of office productivity. Corporate staples such as email and the humble desk phone will be

snubbed in favour of social networking, real time communications and online collaboration. Businesses need to realise and prepare for this to avoid being perceived as dinosaurs by the emerging talent pool.

Business users now increasingly want to break free of the restrictions of the corporate desktop, and this “Consumerisation of IT” brings with it a unique set of challenges.

Central to this is the complexity and risk of connecting what are essentially consumer devices to corporate infrastructure.

The security and data protection we take for granted on corporate desktops (authentication, virus protection, backup) is not mature, and in some cases not even available on these new devices.

There is balance to strike between providing the access users want, securing digital assets and maintaining standards of service.

The demand for ubiquitous, always on, high speed wireless access to support these new devices is also driving businesses to rethink their networking strategies. More than ever, the idea that work is something you do, not a place you go appears to resonate.

The pace of development of mobile devices, networks and applications has been breathtaking in recent years but signs are that this is slowing. The most recent generation of smart phones and tablets from the major manufactures hints that we may have reached a plateau on what can be squeezed in to devices while maintaining affordable costs. That being the case, the battle for market share is likely to be fought and won on applications and content as vendors struggle to differentiate themselves in the market. This will benefit the end user as applications become even richer and more powerful at no or low cost, boosting capabilities and productivity of their treasured mobile device.

Microsoft’s domination of the end user computing device is over but don’t write them off just yet. The partnership with Nokia will yield competitive and, importantly, cool devices and the upcoming releases of the Windows platform on smart phones and tablets will make ground on Apple and Android.

In a business context, Microsoft will continue to dominate the back-end infrastructure so the integration of Windows mobile device in the corporate world should offer some advantage.

Tommy Mitchell

There is balance to strike between providing the access users want, securing digital assets and maintaining standards of service.

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Can you help a social entrepreneur in your community to make a difference?

Do you have an enterprising idea that will benefit your community?

Firstport (www.firstport.org.uk) supports new and emerging social entrepreneurs across Scotland. This new ESF project, the Social Enterprise Skills Exchange (www.sese.org.uk) aims to match business skills and experience to social enterprise initiatives. If you have skills and expertise to offer or have an enterprising idea that will benefit the community, visit our website and get involved!

To find out more contact info@firstport.org.uk or call us on 0131 220 0511 Social Enterprise Skills Exchange is owned and operated by Edinburgh Business Development, Firstport and made possible through funding from the European Social Fund.

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RUTHLESS

HNW MAGAZINE JAN/FEB 2012

Ruthless in Russia The Slow Assassination IT’S the largest country in the world and the UK’s twelfth largest export market, but some view Russia’s widely acknowledged corruption issues, and limited personal safety and property rights protection, as reason enough to eschew doing business there.

“The facts remain that UK exports to Russia increased by 51% - totaling £3.45bn - in 2010, and over the past decade UK-Russia trade has been growing at an average of 21% year-on-year.”

Impressive numbers considering 1/3rd of that growth occurred during a global recession.

And research from Scottish Enterprise and its global arm, Scottish Development International (SDI), show a country longentrenched in economic modernisation and infrastructure development mode.

More enticing still, on the cusp of the 2014 Sochi-based Winter Olympic Games, are emerging opportunities in sports and leisure infrastructure which now sit comfortably alongside the more established export market mainstays of construction, advanced engineering, financial services, ICT and power and energy.

And the ‘but’? Not yet.

Domestically, 2011 proved a record year for investment in Russian real estate, to the tune of Euro 4.55bn – 1.5 times higher than the previous record year in 2008.

Morgan Stanley topped the deal charts with the Euro 840 million purchase of the St Petersburg-based Galleria shopping centre, followed by VTB Capital and Texas

Pacific Group’s move on Moscow’s White Square Business Centre, and the sale of central Moscow’s Ritz Carlton.

Moscow, as usual, accounted for the majority of property investment at 74%, followed by St Petersburg at 22% and then a bevy of smaller investment pools across the Russian cities of Kaliningrad, Kaluga, Murmansk, Ulan-Ude and Samara.

And now for the ‘but’, underscored by Russian foreign minister Sergei Lavrov’s recent visit to London to revive bilateral relations, business ties and attract further exporting.

For beyond extolling the virtues of investment by multi-nationals like BP to support his mission, from behind the iron curtain comes a multitude of tale of bilateral trade gone horribly wrong.

But none as shocking as the Telegraph’s (William Browder, 5th April) story about a UK national and formerly the largest foreign portfolio investor in Russia with £2.8bn under management.

His campaign to confront and clean up a multi-billion dollar corporate malfeasance taking place in the Russian state-owned energy company Gazprom in 2005 eventually led him to be declared first ‘a threat to national security’, and later deported and barred from reentering the country.

And then things really got bad.

Two years on and Russian police raided his office and seized documents that were then used by officials to forge billions of dollars of fake liabilities, as well as embezzle the taxes his company had paid to the Russian government in the previous year.

What followed was the ‘overnight’ approval of the largest fraudulent tax refund in Russian history - US$230 million - paid out days later to a nefarious group of individuals while the portfolio investor and his employees received anonymous death threats.

A young Russian lawyer, Sergei Magnitsky, was hired to investigate the issue – and who eventually testified against senior police officials, judges and the criminals involved.

Sergei was thereafter arrested by the same police officers against who he had provided evidence, locked away without bail or trial, denied medical care and family visits, and tortured.

After 358 days in detention, he was found dead. The Wall Street Journal described his death as a “slow assassination”.

But is this an isolated incident?

Browder goes on to name Mikhail Khodorkovsky and how his company Yukon Oil was expropriated by the Kremlin, how oil giant Shell was forced to sell a 50 per cent share of its lucrative Sakhalin Island project under threat of serious criminal charges, BP’s £148 million tax bill and expulsion of 148 employees, the stories of companies like Telenor, Ikea, NewsCorp, Motorola, Nestle and a host of others enduring similar illegal sanctions.

While potentially difficult reading to those considering expansion or investment in the Russian market, this particular jurisdiction requires a more balanced view than any set of pure statistics in isolation could ever provide.

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DIATRIBE

HNW MAGAZINE JAN/FEB 2012

When Reputations Mean Business During one of the many recent storms of publicity surrounding banks, The Times opined (with a hint of regret) that in Britain today, there exists “a court of public opinion to which everyone is accountable.”

THE paper is undoubtedly correct, and business owners and leaders should listen carefully and start thinking more strategically about reputation and how they might withstand the white heat of a crisis.

This is, after all, the age of round-theclock, non-stop news programmes and newspapers fighting for survival in a cutthroat media environment.

of a problem, when getting off the front pages seems to be the only consideration.

They might then convince themselves that because the media and politicians have moved on to some other hapless target, they are quietly being rehabilitated.

It is a world in which we are all ‘citizen’ journalists and photographers armed to the teeth with mobile phones, cameras and the instant publication mechanisms of Twitter, Facebook and YouTube.

But it simply doesn’t work like that.

When the next crisis hits, that infamous court of public opinion will immediately judge you against what it knows. And if the last they heard of you was during some other crisis, then prepare for the worst.

Hard-earned reputations and brands, built over many years, can be undermined in the course of a day if the risk is not carefully managed.

Whether you are guilty of incompetence or simply a victim of circumstance, the bright lights of a crisis will illuminate your every move.

“Having directed communications for airport operator BAA through a number of high-profile crises, including the terrorist attack on Glasgow Airport and the opening of Terminal 5, I’ve learned a thing or two about managing communications in a crisis.”

If you have not spent time building trust, essentially your credits in the bank, with the media and politicians and customers and so on, then you have in effect handed them a license to say whatever they like about you, and you’ll be running to stand still during the crisis itself.

The key is fast and unequivocal communication to all of your stakeholders, and having a wellrehearsed plan.

“When the next crisis hits, that infamous court of public opinion will immediately judge you against what it knows.”

But perhaps more importantly, I have learned that communicating all of the time, and building relationships with customers, the media, politicians and regulators especially during the good times are the most essential and often unwritten components of a good crisis management plan.

It is still the case that some company Boards and senior executives are lulled into thinking that a low profile equals a good or improving reputation, particularly in the immediate aftermath

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It need not be complicated – I simply argue that companies manage

reputation risk in the same way that financial or operational risk is managed – in an organised and transparent way and with rigour.

Understand the risks, and how they might affect your business, and then mitigate them.

It is no doubt easier to measure the loss of an important contract or the implications of an industrial accident – but a brand or a successful business leader is, arguably, nothing without a good reputation so why not spend time thinking seriously about it.

Put that reputation at the heart of your company strategy and resource it properly.

Too many business owners and leaders rely on traditional communications arrangements; PR advisers, or specialist crisis managers, that can be called up when the proverbial horse bolts.

That is all well and good, and you will certainly need them. But the smart companies will do more to ensure the stable door is firmly closed and secure in the first place.

Malcolm Robertson is HNW Magazine’s guest columnist and director of MGWR Ltd.

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The Converge Challenge

Business Plan Competition

2011

Congratulations ‘Bellrock Technology, University of Strathclyde’

1st prize Winner of £25,000 in cash & £20,000 in business support

Thank you to our sponsors

For information on Converge Challenge 2011, go to

www.hw.ac.uk/convergechallenge

Distinctly Ambitious www.hw.ac.uk/convergechallenge