As you already know, I had the chance to attend Dublin Web Summit mid-October and I’m going to share what I’ve learnt and experienced there.
First, DWS is probably the best tech startup event in Europe (OK, I haven’t been to all of them – I’ve also heard lot of good comments on Pioneer Festival). Or at least the biggest: Around 300 startups (among them, the Swiss startups mobino, 3Baysover, Alensa, InZair) were present at Startup Village. More than 4’000 startup-minded people (8x as much as the first edition back in…2010!) from over 45 countries attended. Top speakers from around the world (founders from Pinterest, Skype, Flipboard, etc.) presented their point of
view or shared their industry knowledge on 3 different stages (main, digital marketing and cloud stages). Moreover, each startup present at Startup Village participated to a
competition with a prize money of EUR 100’000.-.
To ensure a good visibility for the startup pitches, the organizers had the clever idea to place the startup stages in the middle of the event and that was one of the first place you were seeing when entering the event.
Dublin Web Summit prepared networking opportunities (some were a bit of a flop, though), among one an amazing one: the investor area. Originally, you had to be part of the Startup Village to have the possibility to pitch the available VC’s or Business angels on a 1-to-1 basis. But in the end, everyone and his brother seized the opportunity (I, too!) to present his project… 2 minutes each, so you had to be effective! As you see on the picture, people were queuing… Good point was that investors were 100% available during this time and you didn’t bother them pitching inappropriately. But when you’re the 20th to pitch someone, what do you expect from it? They won’t commit to anything. But if they tell you that your project sounds interesting and prove it by giving you their business card, you’ve already won something! And if you can surprise them, it’s even better… you’ll “erase” the other pitches and they’ll remember you (OK, it sounds hard… but keep in mind that startup are hard and you have to fight fiercely).
To illustrate the startup spirit of the event, here’s a quote from US rockstar Darmesh Shah:
Pssst. Don’t tell anyone, but websummit has more startups than ANY event in the U.S. GO DUBLIN GO!
The single bad point I’ve experienced there (yes, nothing is perfect) is that the presentation schedule was rarely respected. If you didn’t stay listening all the presentations, odds were high that you’ll be missing the ones you were really looking for. That happened to me 2 times – yeah, I was more networking that listening ;-)!
Beeing at StartupStay home (they’re based in Dublin and London), I took the opportunity to experience the service. What a powerful extreme networking tool! When you’re going to a conference, you have often few insights of how vivid the local startups ecosystem is and how it works. I’ve been hosted by Pierre-Alain, a French entrepreneur working at SAP in Dublin and building his recruiting startup project during the night. What a warm welcome by him and his family! We’ve not been a lot together during the 2 days I was there (he hadn’t time to attend DWS) but the discussions we had made me feeling we know each other for years. What other traveling tool bring you so much as simply free hosting? Now that I’ve experienced StartupStay, my excitation on this service is even higher and I can only encourage you to use it! Of course, this kind of hosting is not for everyone: if you need time to be alone after a crazy business day to recover, it’s maybe not the the most appropriate hosting possibility.
Pierre-Alain and other Ireland-based entrepreneurs shared with me some insights about the place:
- 90% of the whole Irish business happens in Dublin area. The rest of the country is mostly dedicated to farming, except Galway and Cork (which can be named as “Apple city”, because of the establishment of the American giant). Dublin is as big as ZH, but Swiss wealth is distributed across the country (think at Basel, Geneva/Lausanne, Bern and Zürich areas). This closeness of everything is an advantage and even if we have good transportation means in Switzerland, this distribution can be a hurdle.
- Incredible number of big corporations (all US giants are there for their European operations: twitter, Facebook, Paypal, Google, Microsoft, EAsports, but also European ones like SAP);
- These big corporations are now hiring like crazy. That can be seen as even more difficult for startups to hire tech talents (as everywhere: good tech talents is always a scarce resource), but Ireland government is aware of it and facilitate a massive selected immigration. They don’t mind to go hire tech talents from Spain, Greece or Portugal… Hiring marketing, sales and communication talents doesn’t seem too problematic;
- Unemployment rate is high in Ireland (14%, but mostly within less qualified people segment) and State needs to invest massively;
- Ireland is a true gate to USA: the US East coast is populated by a big proportion of Irish descendants. US companies don’t fear to handle with Irish companies (same cultural approach and language), even if you’re not Irish originally and you speak English with a French accent and Dublin has frequent flights to major eastern American cities;
- Good place to be as an employer, as the social charges are mostly supported by the employee: 21% up to a yearly salary of EUR 32’000.-, 41% above). In comparison, social charges rate for employers stays around 12%;
- On the negative side (yes, there are some points!), it is extremely difficult to fire someone (even more than in France apparently – which is already crazy). But according to Pierre-Alain, there is often no need to fire someone, as people simply leave when there aren’t happy in the company. There are sufficient opportunities available to find a new job. Or immigrants just leave the country if they don’t feel well;
- There’s a vivid startup ecosystem in Dublin: alongside local investors, UK- and US-based Venture Capital funds are investing there. Additionally, Irish Government is providing massive support (funds, advisory services, help, etc.);
- The insane real estate boom observed until 2008 has brought a lot of apartments or houses at an affordable price on the market;
- Ireland is really strong about everything regarding content and copyright. Almost every thing about copyright outside US is based there and you have therefore a facilitate access to negotiate license right (think about music!):
- Finally, Ireland applies a flat tax of 12% for companies (that’s maybe not so relevant when you’re starting).
During DWS, I’ve met David Scanlon, deal sourcer for Enterprise Ireland (a government agency dedicated to help Irish companies succeed). His company currently works with more than 2’500 Irish companies and have 30 offices overseas to open doors and do some business development for them (in the same time, Switzerland has only 10 offices distributed around the world (Swissnex) – for a population twice as large). Enterprise Ireland also manages an investment fund, for which it plans to invest in 100-150 companies per year. For instance, they’ve invested in 147 companies in 2011, and have experienced 20 exits (for a total selling value of EUR 800mios). Enterprise Ireland has to financial vehicles:
- 60 companies per year receive a EUR 50k investment. 150+ startups apply every quartal and “only” 15 are awarded a convertible loan (with 3% coupon rate and 25% discount rate after 5 years max.)
- Co-investment comprised between EUR 150 and 500k. This fund is available as a matching fund and can cover 50% of the financing round.
Enterprise Ireland has decided to never convert for more than 10% of the company shares (which is good!) and never take a board seat. It needs to believe that your innovative company will create more than 10 jobs in Ireland during the following 5 years and will generate at least a turnover of EUR 1mio (for a startup, it seems obvious, though!).
After convincing them than your project can have sustainable success, what do you need to be supported? You have to move your HQ there and top management has to be in Ireland enough of time. And all tech IP and copyrights has to belong to your Irish entity. Application process can be as quick as 6-8 weeks (if it is complete) and success rate is really high if your case is submitted to the internal committee.
Moreover, Enterprise Ireland is not the only governmental support you can get. You can also get some financing or subsidies by local support agencies (which are at some level supported by EI).
What does all of this mean for web & mobile startup founders? The best startup hotspots in Europe are still London and Berlin, but Dublin has also strong arguments. Should Swiss web startup founders investigate the possibility to relocate?
To be honest, I don’t know if the location will make your startup succeed. I guess no, but Ireland has strong advantages that Switzerland doesn’t have. Yes, Switzerland produces a lot of innovation, but what do we do with it? Innovations without market success don’t help the country to develop itself.
Ireland has a delicate economic shape, but has set extremely high ambitious goals to recover. They have deeply understood what startups need and invest massively in innovation transformation.
In Switzerland, I have the impression that we are still to shy to take the next step. We could be an interesting location for web & mobile startups (in comparison with Ireland, Switzerland has at least a better climate!), if we had a real political commitment to.
So what? Maybe Switzerland has still a too strong economy. But it’s changing (see all the firing announcement of last weeks) and we should act now if we don’t want to see Switzerland diving…
I’d love to read your comments, so don’t hesitate to participate to the discussion!