Full transcript: Samad Masood on London Real
0:20 Cool, guys. Let’s do this, yeah? Okay. This is Silicon Real, the video podcast dedicated to the people of the London technology startup scene. I’m Brian Rose. I also host London Real, which is a similar three-person trial log format. We have guests like Tim Ferriss from the 4-hour workweek.
0:38 We had George Galloway from Parliament in the air. We had Max Kaiser from Russia Today yelling about Bitcoin, but my co-host today is mr. Joe Scarborough He is a former CFO of an oil and shipping company and now I believe you’re the co-founder of to be seen dot co dot uk that’s right, which is the online community for the entertainment industry and more importantly Joe has a beard and He is one of three men with beards in this country called the three beards and they host a variety of things including the weekly silicone drink about, the monthly don’t pitch me bro and the quarterly digital sizzle. Is that right? And if you haven’t been to the drink about you got to go it’s kind of like something we do after Silicon Real every week. It’s a basically a meeting of tech people either interested or in the tech business or sometimes if you want to just go look at people in the tech business like a zoo you can show up it doesn’t cost you anything you don’t have to reserve it’s got a cool vibe it’s a lot of fun and I always tell people it’s strange because you meet people who are excited about their jobs which is not a normal thing so it’s a lot of fun come check that out Joe thanks for being here I appreciate in the in the hot chair and our guest today is Mr. Samad Masood who is the program director of the FinTech Innovation Lab here in London we’ve been talking about this for the last couple episodes here on Silicon Real I
1:57 Really want to get to the bottom of this thing you’re also a technology research manager at Accenture where I believe you manage what UK technology and global infrastructure? Yeah research of research industries. Also your career began I think as a technology journalist and you became an analyst right? Yeah yeah that’s so kind of yeah I’ve always been in some way observing the technology industry but I’ve never really actually done any technology or created a startup myself which is you know yeah puts me in a strange position actually. Well that’s good well we’re gonna talk about this whole incubation You are the program director of the FinTech Innovation Lab, which basically is an annual mentorship program to help entrepreneurs and early-stage companies that are developing cutting-edge technologies in the financial services sector.
2:45 Is that about right? Yeah, that’s pretty much it. The FinTech Innovation Lab is the difference between the lab and other accelerators that can see is really what we’re doing is bringing together a bunch of really big IT buyers rather than let’s say investors. So we bring together about 14 large global banks. You can see on our website who they are but it includes Goldman Sachs, JP Morgan, Citibank, Barclays, RBS, Deutsche Bank, UBS, you know it’s probably easier to list the big banks that aren’t aren’t there. And it’s run by Accenture which I work for, and the idea is that we have startups applying, they pitch to the banks directly, and we’re not just getting sort of like the junior guys in the banks, we have the top IT directors or the European CIOs or global CIOs from each of the banks, and they sort of listen to these pitches, together the banks choose the startups that they want to go on the program, and then the three-month program sort of kicks off.
3:57 And those startups on the program, it’s kind of, mentorship is part of it, but it’s also really a kind of like a agile development opportunity because the startups on the program basically get to meet a lot of the different people within the banks who might use their technology, who might be involved in implementing their technology if the bank did buy it, who might have good feedback in terms of how they should shift their proposition in terms of enabling the bank to buy it or hitting on the right thing. So for example, a startup might come and they’ve got some great technology that they think does A, but a couple of the banks actually really think it can do B, and another bank thinks it can do C. So on the program, they can explore A, B, and C with all those banks in a non-salesy environment and understand which of these propositions which of these use cases might be better for them to take.
4:52 Maybe they can take both of them. Maybe the banks will help them or be interested in both. Maybe as a business decision, they can go down two routes or stick with one route. And at the end of the program, they really should be in a much stronger position with their business in terms of understanding the pressures and the things they need to do to sell to a large corporate. Banks are the biggest IT spenders, private sector IT spenders, going.
5:21 And selling to a bank is a really complicated thing. And it’s almost this kind of thing of pride that they say in the industry, if you can sell technology to a bank, you can sell it to any large corporate, because of the regulatory issues, the security layers that you need to get through. And all the different people you need to kind of get to say yes before they actually start even looking at procuring your your technology. So at the end of the program you should be in a position where you’ve had loads of feedback from multiple banks and you’ve been able to understand where you should be putting your investment. In fact we finish with an investor day where it gives you at the startups an opportunity to pitch their new propositions to investors. Basically saying you know before the program we had this technology that we wanted investment but you didn’t know whether any large corporate would buy it. We’ve We just spent three months with the world’s biggest banks and, yeah, actually three or four of them are really interested in this, so, you know, show me the money, you know, that kind of thing.
6:22 It also… What’s the timeline for this? Just to give people… I know you have like a September deadline for people applying and then I think you do kind of like a Dragon’s Den choosing process and then you incubate what, first quarter next year? Yeah.
6:34 So the applications are open now and they close on the 8th of September. The process is we have executives from the banks who are scoring those applications, and the top 15 or so applications will go through to the Dragon’s Den, which is the interview day. Are there any limits on who can apply? I guess a public company can’t apply, does it have to be kind of small? Actually the way we define it is you have to have minimum, you have to have a beta technology, so you can’t just be coming with an idea, you have to have some beta product at least that you can play around with and show.
7:12 But at a maximum, you can’t already be established in the financial services industry. It’s gotta be innovative, it’s gotta be new. So if the banking industry already knows you as a company, then you’re not for this program. Obviously, if you’re a large company that already can’t spend sales dollars and marketing dollars to get into the banking industry, then the bank simply won’t choose you because they know you can do it this yourself. And they are honestly there to help small companies and entrepreneurs get a foot in the industry.
7:47 They really want to see new innovation and they want to help. They know how difficult it is for smaller companies and they know that that makes it harder for them to buy and find smaller companies and new ideas. So really the definition is if the banks think that they can help you and they can help you significantly change your growth potential through this program, and they think that what you have is something that they can use, then you’re right for it.
8:14 It doesn’t matter if you could be a company that’s been going 15 years and employs a few hundred people, or you could have been going two months, it’s as broad as that. It can’t hurt to apply. It can’t hurt to apply, basically. It can’t hurt to apply. That’s September, and then there’s the Dragon’s Den selection.
8:29 When do they choose who’s going to be incubating? By the end of October, the startups or the companies that have been chosen will know, and then it starts in January until March, the actual program runs, because it takes us that long to kind of, and we’ve got Christmas and all that, but once we’ve chosen the companies, then we work with the banks to really understand which are the best banks to be directly responsible for mentoring them. So on the program, you can talk to any of the banks, but specific banks will be given responsibility to mentor you directly.
9:02 So that we don’t get to the end of March and no one’s actually, we forgot about one of the companies. Someone is gonna be responsible for each company. Do they move in together into a space? Yeah, so last year we were at level 39 in Canary Wharf and that was a great space. We were one of the first programs there.
9:21 So we do house everyone together. The idea being that it’s gotta be as easy for the bankers. They don’t pay anything for this. We don’t pay them anything. They’re using their free time.
9:33 So it needs to be easy for them to come. And if it’s in the Square Mile or it’s in Canary Wharf, then that’s easy for the bankers because that’s where their offices are, so. Okay, and then Jan, so Jan to March, you incubate and then there’s like a, is it a pitch day at the final day in March? Or do people present all their tech to everyone? Are there VC people there on that final day?
9:54 I know you’re not trying to necessarily foster VC. you’re trying to foster the growth of the company. We call it the investor day. We have a sister program in New York, and they call it the demo day. And I think their format is slightly different where they’re kind of demoing what they’ve done.
10:12 What we do is we take half a day. We invite a lot of senior bankers. We invite a lot of media. We had it last year at the mayor’s office. Hopefully, we’ll have it there again this year if we can find a big enough space there.
10:27 Cool. We had the deputy mayor presenting. Boris didn’t show? Boris, yeah. Boris has put his name to our program, but he’s a very busy man.
10:36 He is busy. Very busy man. But the deputy mayor is also perfectly suited because he’s a deputy mayor for business. He’s also been an entrepreneur himself. So he actually gave a really great speech on the day about the challenges he knows that everyone faces and how this sort of a program can really help London and things like that.
10:54 So it was really great. But the benefit for the startups is, yeah, we have investors there. But I coached the startups on that day, really, to focus on what’s new about their proposition. Don’t go into the details of the tech or demoing. It’s going straight to the, we help this industry like this, or we help businesses save money here or make money here.
11:19 We reduce the cost of that. Really get down to the specifics, really excite people. And then we have networking afterwards. So because people can come and talk to you afterwards, really the benefit is, yeah, there’s investors, there’s other senior bankers there, there’s some government people, but there’s a lot of media. And the occasional beard.
11:36 And the occasional beard, yeah. We invite the three beers, we invite other people in the ecosystem, because for us, it’s just trying to get these guys as much exposure as possible. You know, I got introduced to you a few weeks ago at one of the drink bouts, I think Bryce introduced me, and you told me about this program, and part of it, it almost seemed like philanthropy, because like you guys set it all up, bankers donate your time you know Accenture doesn’t really get anything specific about it nothing financial yeah it’s a it’s a strange program in that sense I mean you’ve probably seen a lot of incubators in in the area but most of those take equity sticks and stuff like that but why why are you guys doing that or why is your program set up like that I mean I I agree with you I think it’s a great it’s a great model when when and I have to say I can’t take any credit for coming up with it and when when when I was told you know well or asked or told to do this program.
12:26 I was told, yeah, this is how the program works. And I was sitting there like, wow, this is awesome. It all just kind of fits together nicely. The banks get something out of it, et cetera. I’ll explain Accenture’s position on it and why they’re involved and why we came up with this.
12:41 For people that don’t know, can you tell people what Accenture is? Because some people are not. Accenture is the world’s largest IT services and outsourcing company. and we focus on providing IT consulting, IT implementation, outsourcing, we do some business process outsourcing, and we’re a global company. I think we are hitting about 29 billion revenues and we have about 260,000 employees, so.
13:09 They’re big. Yeah, we’re a very big company. But we’re also renowned for being very flexible and very, you know, we’re at heart consulting and technology services companies. So we’re kind of, you know, we mold to whatever the industry is doing and we partner with a lot of things. I mean, IBM is one of our biggest competitors but also one of our biggest partners.
13:35 You know, it’s one of those industries where there’s a lot of this kind of co-opetition going on. So we’re quite comfortable with that sort of stuff. You were saying, so when you got told about the program, you were kind of surprised. Yeah, well, I was happy that such a program kind of existed because there is a challenge, I think, with accelerators putting in equity stakes and whether that kind of changes the focus and such. And I think really what it boiled down to was we wanted to do a couple of things.
14:09 So we wanted to help London And in New York, where the program started, the aim was to help entrepreneurs in New York. And we partnered with the New York City Investment Fund, or it’s actually called the Partnership for New York City Fund, which is a nonprofit fund set up to invest in entrepreneurs in New York in lots of different industries. And they worked with Accenture to come up with the FinTech concept and how it worked. And we thought, well, we can apply this to London as well.
14:39 And the aim is that we can take an asset that a city like London has, which is financial services, and the asset of tech city, and Silicon Roundabout, and all the great things that are happening here. And try and bring those together in a kind of, I kind of think of it, it’s where the rubber hits the road. You’re getting companies, and you’re getting people who buy technology, you’re getting people who make technology, people who buy technology, and you’re getting them to actually give it a go and try it out over a three month period.
15:12 This would never happen without you guys as a middle man. Yeah, and let me explain why we do it, specifically Accenture gets out of it. So there’s, you know, all these banks are our clients and we want to be able to provide them a platform for innovation. You know, all these banks do this sort of stuff separately. They have their own engagement with startup communities or their own innovation programs.
15:36 But by being a sort of middle man, we bring together all the banks together in a kind of independent way, and they can then collaborate together on things. Let their guard down a little bit. And let their guard down a bit. It’s no one bank leading this. So, and obviously we get a bit of kudos for that.
15:54 You know, I mean, we’re helping the banks. The banks think that, I call it the, you know, the Accenture’s cool factor. You know, we want the banks to think we’re cool. And, you know, that’s one big objective. But another objective is really investing in London and investing in the economy.
16:10 We’re a massive part of the UK economy. We’re massively involved with loads of companies. And it’s in our benefit, and it’s also in our own being part of the community to kind of invest back and help entrepreneurs grow. The third thing is also it just gives us insight into what’s hot, what hot technologies are happening out there, and it’s an easy way. So if you think of all those things, and it works out for us.
16:43 Joe, you’re a finance guy. What comes to mind when you hear about this? You might have known about it last year, but what goes into your mind when you hear him describe that? I think it’s good. I don’t think enough of the bigger financial institutions really put enough value in the type of innovation that’s in a startup.
17:01 They all innovate. They all have to innovate in order to keep up with the market. but to get a really, the kind of just do it attitude that you get in a startup, I think it’s really important for them to kind of get with this kind of program and with that pattern of innovation that comes in a startup and that is fairly radically different to what happens in their own kind of innovation departments. You know, we always bump into the innovator’s dilemma on this show.
17:24 I mean, I worked for almost 10 years in banking at a company called iCap PLC and you know, we saw technology coming, we saw electronic broking coming and we ran from it. We were like, let’s keep making our money in our old school business model. We’ve had TransferWise here, we’ve had John Collison from Stripe here. They all talk about how, you know what they say? They say they’re not worried about the banks ever competing with them because they probably won’t do it till it’s too late, till they have to buy the technology, that kind of thing.
17:49 But obviously what you’re doing is trying to subvert that. You’re trying to kind of tackle that innovator’s dilemma and get what the innovator’s talking with the old school guys. Yeah, I mean, you know I the innovators innovators dilemma is it’s one of those things. Sometimes I wonder if it’s ever it overused No, no, no, not at all. I think it’s a real thing. It’s a real thing and The fact is if you’re making money out of something that has made you money for a long time And then you see something new that makes you much much less money In fact, you have to sink a lot of money into it for an outcome. That’s undefined and five years in the future I’d like to meet the guy who makes that decision because I don’t think many of us could make that decision and you know it’s a natural human thing and what I’m in my personal hopes for this program are that by bringing the banks together, because one of the key things in our program, once we get to the end of the program, all the banks sit together in a room, all their senior guys who met at the start and chose the startups, they sit together and we do what’s called a chaperone review. Chaperone is the term we use for the guys within the banks who are mentoring directly or kind of chaperoning the start-ups through their program. Sherpa might have been a better term, chaperone’s a bit creepy, but…
19:09 Sure, sure, it was a little creepy too. Yeah, I don’t know, I mean, I see you’re on some… Banks carrying their bags. Basically, yeah, I couldn’t think of a better one, But the chaperones then report back to all the senior sponsors, so the CIOs from the bank, and they get to share that. So they all hear what the other bank thought about this company or that company.
19:31 And I think there’s a big opportunity for them to, you know, a lot of people say to me, well, surely they don’t want to share that information. And yeah, there are certain technologies and certain startups which would be so differentiating for one bank that it wouldn’t work in this format for the program. But more and more of technology, I mean, some would say 80% of technology used by corporates is non-differentiating. It’s something that everyone does anyway, and if we can all do it cheaper, then great.
20:00 And it actually creates, you have this room full of the banks, you have the startups, and let’s say there’s one startup that they all really like, and some of the banks didn’t have a chance to work with them so much on the program, but they hear the other banks are saying, yeah, that’s really good. Then that gives them the incentive to try and get over those innovation barriers and go, well, we better quickly execute on this because all our competitors are also keen on this technology. And, yeah, the person who gets it first just gets to cut their costs sooner, you know, and it’s not going to, you know, make or break one bank over another, but it means that you can do it quicker than the other bank.
20:37 And so, ultimately, it’s giving them some incentive, some, you know, they’re collaborating, but they also get to a stage where they go, we better do this quicker than the next guy because we’ve all seen this now. Have you ever had a friendly conflict at the beginning when they’re picking which startups they want to work with or you’re kind of separate? Oh, yeah. Yeah. I mean, we’ve had startups where I’ll say to the room at the end of the interview, does anybody, who wants to mentor this startup and everyone’s hands go up here?
21:03 Okay, that’s not going to happen, you know, and so you’ve got to, you know, but they’re all good guys. They’re really, I’m really, really happy with the people involved in the program from the bank side. They all take it in the essence that it’s meant to be. And everyone sees it, first and foremost, as something to help London, help entrepreneurs. Going through this program does not guarantee you a sale with a bank.
21:27 It is very, very difficult to sell to a large corporate. And it takes time. But it gives you a big, big boost. And if you get to the end of the program and you decide that, yeah, you don’t want to sell to a bank or a large corporate because you’ve been through that intensive peer process and realize, you know what, I don’t have the funding or I don’t actually, my proposition isn’t watertight enough for this, then that’s great too, because you learned that in three months then taking three years and meeting two or three banks.
21:58 Right, so what happened last year? How many companies get along? What was their fate? And what are you gonna do different this year? What did you learn in the process?
22:06 So it was our first year in London. Because New York has been going for five or six years. New York is now just finished its third year, so New York was finishing its second year as we were starting our first, and we had 62 applications, and of those, we sure this did 14, then we were aiming to choose 6, but we squeezed in a 7th, we all agreed that we can get another one in here. And the companies, some are quite well known now, I guess, within London, but Digital Shadows was one. And Growth Intelligence. BehaviorSec, which was doing behavioral security.
22:55 Then there was a company called Call Trunk, which is now called Open Voice. They sort of pivoted and decided they were going to be focused on something slightly different at the end of the proposition, at the end of the program. The open bank project, and Kibu was another one, which is personal finance management tool, and I’m gonna embarrass myself by forgetting one of them. Have I given six or seven? I’m sure there’s one of them.
23:21 Digital shadows, growth intelligence, open bank, behavior’s sake, yeah. Okay, and so did any of those end up raising money? Did they work with the banks? Did they obviously if you still remember their names, they’re still around. Oh, yeah Yeah, I’m in touch with all of them and you know, we’re still Most of them if not all of them are still having discussions with the banks. Okay, you know and You know in oh, I forgot war attack is the seventh war attack was a really really interesting company and they’ve done really really Well out of this and and they’re actually not just applicable to financial services So they do virtualization of Java and which I’m already getting technically out of my depth there But what it does is enables you to virtualize Java implementations much more than just beyond the hardware level. So you’re going to the software level So is there anything you’re gonna do differently this year after last year or is it kind of the same model?
24:19 You said I mean must be climbing a big learning curve. Yeah, we learned a lot of stuff And there’s a couple of things that we’re doing differently. So So first is, during our first year, during the program, each bank had an event. So each bank, every week, we’d have one or two events with the banks, and one bank would basically open its doors, invite all the startups to their bank. Sounds like a fraternity rush, by the way.
24:48 Like everyone wants to be their big brother, and they want to show how cool their house is. Exactly, yeah. And they would then put on a few drinks or nibbles, and they would give a presentation on their bank or a theme, we asked them all to give a presentation on a theme. So some of them did like procurement, some did security, some did like the growth of technology and banking, some, you know. But really the aim was for us to get a few more people within the bank socializing with the startups, but also for the startups to kind of get a bit of insight into the different cultures of the banks.
25:19 And it’s quite eye-opening when you go to 12 different banks, you know, from which come from, you know, two different continents And they’ve all got different cultures. They’re all very different types of banks. So that worked pretty well. But what we learned from that was actually one of the things that worked really well was speed dating. And what we’re doing this year is in the first two weeks of the program, it’s going to be intense.
25:43 But we have each bank will do half a day of speed dating on their own premises. So all the companies turn up, and they get speed dating with a series of different executives. So banks, you have the IT guys, you might have people from different parts of the IT division because IT divisions are massive companies in themselves. Then we’ll have senior executives from different parts of the business, so the business side. So that might be retail banking or mobile banking or might be different trading desks, et cetera, or wealth management, et cetera.
26:18 And that gives those senior executives an opportunity to very quickly meet these startups. And if it sparks off any initial ideas of, yeah, that’s great, that we should talk more. It’s a lead generating. And the chaperones, who I mentioned earlier, who are kind of from each of the banks and helping this, that gives the chaperone and each of the startups a few leads at the start of the program to go, OK, let’s follow up these guys. Or we thought you’d be a real hit, but you just spoke to the most senior guy in that division, and he doesn’t get it.
26:51 So we need to find another way to get to him or we need to actually think about you know There was that other guy who really liked what you’re doing and thought you know You could apply it to that part of the business in this whole process I’m just curious how much is the technology and the business idea and how much is the person behind it? And that’s why we do this show to find out the people behind the tech and a lot of people that have been here said They invest in people ultimately, you know, so I mean I you know speed dating I guess is getting to know the person But you must see it on the front lines. I mean, obviously, a really cool motivated guy with no business plan is of no use to them.
27:23 But how much is it? I mean, one thing I’ll say is that speed dating is not the best way to learn someone’s personality or whether you can work with them. It’s a quick way to really quickly. Is this from your own personal experience on the dating team? Yes, no, no, no.
27:40 Yes, it is. You’re right. You exposed me. I’ve speed dated before. Yeah, it’s a bitch.
27:45 Yeah, but the speed dating thing, you know, it’s great for like very quickly getting a lot of information and then having a few early thoughts and then following up with. But in terms of your question, is it the person or is it the technology? From my personal viewpoint, I would say it’s 90% the person. Because it’s like all business and I think, again, this is me talking and my experience as a journalist and seeing the dot-com crash and then seeing the new bubble being created right now.
28:23 It’s about business, it’s not about technology and business is about trust and it’s about knowing you can work with someone and feeling that, I mean there’s this term shared value which is terrible, it really means you get something out of this, I get something out of this and if we both know what we’re both getting out of this, that’s cool, we’re okay with that. And actually, what I’ve learned by seeing businesses interact with each other, if one business doesn’t know what the other business is getting out of this, then they want you to make something out of this, because they want you to be as driven into it as well. So actually, a lot of the startups who come to me and say, I want to apply.
29:02 What am I going to say? What should I focus on? I always say, focus on the business side and focus on what you want from this, because It’s human beings who are choosing you, and those human beings want to help you. They want to see you grow. They want to sit back and go, I wasn’t involved in that guy, he’s doing really well now.
29:21 And they want to invest in you. And we have certainly had examples of great technology which didn’t get through because the panel did not think that the person was someone they could work with. I want to ask Joe the same question. You wrote elbows with all the people at these drinkabouts, and don’t pitch me bros and and everything and I mean, you get to know all these personalities, you probably hear business ideas that overlap each other and things. Would you say 90% or what’s your take on that same question?
29:51 Yeah, yeah, but 80 to 90, definitely. I thought you both were gonna say 50-50. No, no, no, no, no, it’s so much about people. My wife’s a great one, she’s like this tech thing, it’s sucking the emotion out of things. It’s really not, it is all about people.
30:07 Silicon drink about is about people. and then pitch for you is about people helping people with their propositions and it’s just its relationships and the more people understand that if you help somebody and you don’t expect anything in return that kind of pay it forward culture you will get it back because you will get a reputation as somebody that helps and then people will want to help you. Yeah, which is pretty much what you guys do, pretty much what you guys are doing.
30:30 Yeah. The thing is I’ll say particularly in B2B technology, so in B2C technology I’m simplifying it, but you can basically create an app or a website and test the market straight away. When you’re selling to businesses, it’s a lot more complicated because you have to customize your product. So it’s probably if you came to a business with a product that’s only half thought through, but then you worked really closely with them to think that through with them.
30:59 You probably have just as good a chance as coming to them with something that’s fully thought through and it’s like, you know, it just takes time and trust and relationship to do that. And that’s what we’re, you know, most of the startups that come to us have, you know, they’re not fully baked. They’ve got technology. They’ve maybe got making a bit of money. They want to see if they can make this work with a large corporate. And that’s what we’re trying to help. But all that is based on trust, relationships, people being able to communicate. And, you know, people will help you. People will help.
31:31 If you’ve got half an idea, they’ll help you make it into a full idea because they can see the other side of what they would do with that technology. Right, they get personally invested probably in what you’re doing. This is a part of the show where we try to ask you a couple of devil’s advocate questions. I think you have one ready, but I was mentioning the Innovation Lab to a few guys that have come through here and sat down at that chair, and one thing someone said was they thought at this day and age in 2013, there might be over incubation, as in you get all these guys ready, you set them up for these, they think they might get funding, and then just stop and it’s like okay now 15 companies have been set up they’re not gonna get any funding and they’re not any further and I must say after you describe it it seems like a lot of upside getting to know these people but do you hear that argument a lot and what do you say to that so yeah I mean I’ll be interested in your your view on this I think the over incubation I I think there can be too many things going on that becomes a distracting for an entrepreneur that there’s so many things that they could get involved in they’ve got to really make some tough decisions about do I apply to this accelerator do I take this guy on as my mentor you know how do I get rid of him if he’s terrible six months out of your business cycle you’re going here going there exactly
32:46 And and there can be too many things but I don’t think that’s that’s up to the individual to decide what’s best for them and there’s having loads of choice and loads of activity in the ecosystem I think is great I’m really happy that there’s the opportunity that we could even be suggesting there’s over incubation. But there’s one thing I’d like to pick up on what you said about getting investment. And one interesting thing is that in our program, like I said earlier, I see it as where the rubber hits the road.
33:14 You’ve got some technology and you’re working with clients. It’s not you’ve got some technology and you’re working with mentors to get you to a stage to get some, to sell some equity to then maybe see if you can, you know, which actually B2C works in B2C probably better, because like I say, you don’t have to work on long sales cycles, you can just put your app on an app store or set up an online website and just do some PR and marketing and you can see pretty quickly. In the B2B world, some of our companies and some companies that would come to us, I wouldn’t be surprised if they don’t actually need another round or they come out of the program in a much better position to negotiate for better investment times because they’ve got customers.
34:04 They’ve got big customers and all they need to do is keep growing that. I think there’s a hangover from the dot-com era where we think, you know, an exit means a certain type of thing. I think there might be a new generation of entrepreneurs which are thinking, and I think you can look at someone like TransferWise, and you were sort of saying that as well, you know, they’re not scared of the banks, they’re just going on doing things. You know, companies now, there’s the opportunity for you to just get on with it and do it.
34:37 And you don’t need to be thinking just about when is my exit? Yeah, I find it’s, I mean, we had Simon Cook from DFJSPRE, you know, big VC manager, He said the same thing. He said you shouldn’t be working toward getting my phone call You should be working toward you know getting cash flow building your clients making your customers happy It’s not like I give you you know a chunk of money, and then everything’s gonna be okay You know so he was he kind of reiterated that Joe. What’s your thought on that on that same question?
35:04 Um I think the incubators are the same as anything else there is there are a lot of incubation companies or organizations out there and I think in the same way that some businesses are good, some businesses are bad, some are kind of good at what they do, maybe they change it up a little bit. The same thing will happen with incubators, the startups will go in and they’ll either come out better and tell everybody or they’ll come out and say, I’m not really sure that was worth my time and that will get around and the incubator will either need to improve on those points and become a more value add incubator or it will just stop running Because whoever, if the incubator is passing those on to investors, and the investors are not really impressed, then they’re not doing their job on that side.
35:46 It’s just one of those natural cycles where if there are too many, then the weakest will just have to drop off, and the strongest will prevail, and the startup community is such that the strong ones and the ones that really provide value, everybody will know about. Because they will say, I went there for six months, best thing I ever did. And that’s not to say that there’ll be five or six that are the really strong ones. incubators provide different values or different startups, you know. So if one has got a much better kind of retail proposition and they can help in that sector much better, then they’ll get renowned for that and then they’ll start to attract just those types of startups. Yeah, you know, it’s something Collin and I were talking about, I mean, just getting the ear of someone that knows the CTO at a big bank, I mean, like you said, doing business into a bank is such a difficult process. So like just giving people that introduction, that kind of information flow. And like you said, ultimately you’re introducing these people to their future customers, not their future investors. And I’d say it’s not just, you know, I don’t want to be beating up the banks because all large corporates are difficult to sell to, all large businesses. And what we hope with the FinTech Innovation Lab is that you have, if you’ve been able to do it with the banks, then it should be a breeze doing it, you know,
37:02 Another another call for it, you know, you know one thing that always comes up on the show is You know silicone roundabout versus silicone alley silicone valley, you know We always seem to talk about this and i’d love to get your thoughts both of your thoughts as as you know Where are we? Obviously, we don’t see those big public exits that the state has Everyone has to admit that fintech is one of the most exciting things going on in london But in your opinion, what do you think is missing in london? Or is there anything missing when it comes to those major centers as far as a mentality?
37:32 Does it need more things like what you’re doing? More exposure to investors? I’ll be cautious here because I’ve not done any, having a research background, I’ve not done any real detailed research into this, but if we were just going to go be completely simplifying it. I would just say the fact is there’s more money in America, you know, that’s it. People talk about, yeah, in Europe, in the UK, we’re a lot more cautious, and I think that’s true. We’re culturally more cautious, that’s totally true, but they also have more money. So I think we’ve got to get over that, and the getting over the we need the big exit in Europe, I’d rather say we just need the great businesses, we need the profitable businesses and actually what’s better bootstrapping than never getting your billion dollar investment but becoming a 10 billion dollar business without it, you know, because it’s tough in Europe but it creates and I think it always has created a level of innovation particularly in the UK which I personally think comes out of, you know, the culture and attitude we have here, which is, you know, we’re kind of, we’re hard on ourselves, we don’t make it easy for ourselves. And, you know, it’s a completely different attitude from the US. And the US has done, I mean, we all know awesomely at this sort of stuff. But, you know, the UK isn’t too bad, really. For our, you know, we punch above our weight historically in terms of innovation. And I don’t think
39:12 We should worry too much about trying to replicate another model. Joe, is that something you come up with all the time? Do people bring it up or do you think about it? Yeah, I hate the where is the next Silicon Valley question. I don’t want it to be another Silicon Valley.
39:29 It is what it is. I want London to carve out its own shape. It doesn’t need to replicate anything else. Obviously, it is a number two or perhaps a number three in the world for startups. But it’s just, it’s on a path and I think it’s only going to go on to do bigger and better things.
39:48 Especially in finance. Yeah, and it’s on the doorstep of Europe, it’s got so much potential. I think when the Americans go straight to Europe, they usually screw it up, you know. It’s hard to understand it without being here, you know, kind of on the doorstep, you know, how it works. So I want to ask you a question.
40:03 If they sacked you from Accenture tomorrow, hopefully not. But if they did and you had to sign like a non-compete, you couldn’t do any research, You couldn’t do anything like that. And I gave you some seed capital, you know, five or ten million pounds, what would you do with yourself? You know, is there a startup you would like to go run after? Or you can’t go to an island, is what I’m trying to say.
40:23 Damn. I bet I could buy an island and then sell some… Yeah, I mean… You don’t seem like the kind of guy that would sit still. I could be the Uber for islands.
40:31 Okay. Yeah, yeah. I find capacity on beaches and I’d resell it. Let me answer your question in a different way, I don’t see myself as an ideas guy but a lot of people talk about making your luck or creating opportunities and such and I’m coming to think that actually what it is is you’ve got to look at what assets you have in your, and that might be your personal skills or it might be something you literally own or access to a network you have, or you’ve got to look at those assets you have and then how you can turn those assets into something that’s profitable and fulfills you as a person.
41:18 Rather than going, I want to create the best website dedicated to peanut butter based recipes in the world, but actually I’ve never made peanut butter, I don’t know anything, but I’m going to teach myself in Scratch. Don’t try and pick this sort of ideal, what you really want. Look at what you’ve actually got and how you can turn that into something really amazing because the stuff that you’ve got and the experiences that you’ve had, no one else has that.
41:42 And all you need to do is piece that in the right order to create value for someone and whether that’s, you know, making, you know, getting employed by someone else or whether it’s making something that you run yourself, it doesn’t really matter. Because for me, I know this is going to sound really cheesy, but it’s a bit more about personal fulfillment and, you know, I just want to feel happy with myself that I’m I’m doing something that I enjoy, and I’m very lucky right now to be doing that. Joe, you must see that a lot, where people have a great idea, but then if they look in the mirror, it doesn’t reflect what they have.
42:14 I mean, we had Jeff Lynn from Cedars here, and he was going to business school here in London, and he met a guy who needed basically a lawyer, which is what Jeff is, and needed someone who could sort through all these legal docs to do these startup companies, and he’s like, that’s ultimately why he partnered with me, because he knew what he brought to the table. But I mean, do you see that in the drink about, where a lot of ideas are flying around, you’re like, okay, what have you got or what are you good at? Yeah, I mean, you see a lot of ideas being discussed and quite often people say, hey, do you want an idea?
42:40 I’ve got an idea. I’m never going to do anything with it. I think it’s great, but I’m just not the right person for this idea. And they’ll give it away and someone else will go, oh, I kind of like that, you know. And so that kind of happens all the time and you’re fine with people that are doing their thing.
42:56 They’re concentrated on their thing, but because they’re ideas people, they’re still coming up with so much stuff and they’ll just talk to everybody about it. They don’t keep a secret black book of their best ideas that they’re going to do when they get around to it, because they know that someone else will come up with it eventually, so just chat about it. Ideas kind of evolve that way as well. You say one thing and someone else goes, oh yeah, but kind of what you were saying earlier, if they’ve got proposition A, but actually it fits on B better, just chatting to people and kind of being open about your ideas actually helps those ideas evolve.
43:24 So yeah, they kind of fly around all the time. That’s well said. All right, Samad, I’m going to hit you with the advice question. This is a good one. make a phone call to the 20-year-old Samad and you could give him a bit of advice what would you tell him to do or not to do? I’d be like I’d say listen to listen to the old guy on the phone and the 20-year-old will be going what who who yeah I’m not saying you would take the advice what would you tell him? I would probably say yeah just do more exciting just do more adventurous things, take more risks, because ultimately it’s probably going to work out in the end.
44:06 What I realize now about what bootstrapping really means and what I’ve learned from seeing entrepreneurs and seeing the courage they have is that ultimately you will make it work. So it doesn’t really matter where you go and how you stumble or whatever, because you will make it work. You’ve got those skills to do that. And I would just tell the younger me to just be a bit braver, I think. It’s something we hear a lot, everyone always says, especially when you’re young before you have the mortgage payment and before you have the diapers, just to go out there and just do some crazy stuff and take some chances before you have all those commitments.
44:44 Yeah. Well, I don’t have those commitments now, but yeah, I agree. And on that same note, what’s the best advice you’ve ever been given? actually that phone call one, so it was listen to people who are older than you. Really?
44:59 Yeah. Because a quick little story, I was at a bar, it was a big night and you know, lots of people there and was outside chatting to a guy, turns out he’s 10 years younger than me and the other guy is 10 years older than me. And so we’re like, oh wow, we’re all like 10 years apart. So that me and the younger guy turn to the older guy and say, so tell us, tell us, what’s it like? What’s the future like, you know?
45:27 Because you’re obviously still cool. You’re hanging out here, and he goes, yeah, yeah, OK, well, the one thing, the one thing, you guys really need to know, the one thing you need to know. Listen to the older people, because they really know what they’re talking about. While he’s saying this, me and the younger guy change subject, which is like, yeah, and he’s in the background going, guys are that old lady who told me, And I really wish I, you know, um, so it’s kind of, you know, for me, it’s, uh, that’s my advice, but like all advice, you’re probably not going to stick to it.
45:58 So yeah, well said. And the final part of that question is, you know, to the 20 year old listening or the 25 year old that, you know, is starting in the business, you know, starting and wants to maybe be a tech startup someday or maybe one day get into the fintech innovation program. What advice do you have to them? I would say, don’t believe the hype, that was one thing that has stood me very well is to just be, don’t get carried away with things, try and think very, you know, however cool or modern or new something is, or an idea is, always try and go back to basics and to learn those basics you just try and be, you know, a good normal human being and focus on your personal relationships, your own personal life, because you ultimately can’t, you don’t have a yardstick to measure good or bad ideas against if you yourself aren’t a normal consumer and have your own life and your own interests.
46:58 So just be as normal a person as you can, enjoy yourself, do what you want, and those ideas, other things that you want to do, if you want to be an entrepreneur, just have a normal life as well. Don’t forget that you’re also human. If you lose that humanity, it was pointless doing it in the first place. It’s an interesting spin because everyone has all these new tech ideas, but business is as old as the Bible. The quote of the episode for me is what you’re saying, business is all about trust, really.
47:29 That’s what doing good business is and getting to know people. As cool as your idea, as virtual as the world might be, as we know what to drink about, you pretty much do need to sit down and be around people. One of the reasons you put everybody in the same spot, because I think you need physical density of people to get those ideas to happen. You can’t do it all online and stuff. So Joe, before I wrap things up, what did I miss? Is there anything I didn’t ask him or anything that was on your mind?
47:53 Yeah, what I’d like to know is how close have you come to jumping ship and joining one of the things that you research? Because you just think it’s great. Good question. Well, I did it. I used to research Accenture and I joined them. And when I left, a lot of the people I worked with were saying, oh, at first I was a journalist, then I became an analyst, which was considered jumping the fence, and then as an analyst, I was analyzing the IT industry and Accenture, so I’ve already done it, and it’s paid really great dividends.
48:30 I love the company, it’s a great company, it’s got great people involved in it, and I was really happy I did that. I think because my very first proper job was writing for a magazine that was trying to be like the Red Herring for Europe, if you guys remember that magazine, and so it was trying to write about venture capital in Europe and tech, and it launched in September 2001, I think. Basically, it launched just after the dot com. After the NASA crashed in June, or whatever.
49:09 Just around you know September 11th and so I spent a year trying to research VCs that weren’t investing and startups that weren’t going anywhere and I learned very quickly that what the hype is and was was and so I you know yeah there are some companies I see that go I just think wow that is a really solid idea that’s brilliant that’s going to be amazing and then I look at myself go I’m not really sure I can add anything to them so it goes back to that assets thing you You know, if I see somewhere that I see a great marriage of what I know and can do with what they know and can do, then I’m always interested, you know. So you’re not tempted to jump into one of these start-ups, you’re just happy to kind of incubate them and help them along. Yeah, for now, yeah, I mean, for now, the job I’m doing now is something I’ve always really wanted to do, and I’m very lucky to do it, so, you know, I’m happy to help.
50:00 I want to help people, I want to see new technologies, I want to see how business works, and I’ve got a lot to learn. So you can learn from that. Excellent. All right. We’re talking about days, I think, by the time this gets published until it’s for people to apply.
50:12 So tell them again how they can apply, what do they do? So they can go to the website, fintechinnovationlablondon.co.uk, you can Google it, and the application form is on there, September the 8th is the deadline. So please get your applications in. Yeah. And they get to hang out with you as well.
50:31 If they want, yeah. They hang out with me. They hang out with you and they can meet Joe at the end in March. Yeah. Oh yeah, you can meet Joe.
50:40 You can meet Joe whenever you want. Yeah, any Friday. Sorry. I just basically invited the whole company. That’s fine.
50:45 That’s fine. That’s what we do anyway. It’s cool. We promote it every time. And what about, are you on Twitter?
50:50 Do people want to get in touch with you personally or do you not want them to? I don’t use Twitter personally much but if you do want to find me, it’s bad mood and my suit. Really? Wow. Bad mood and my suit.
51:02 Okay. Awesome. I think it’s a great idea. It just sounds like this whole pay it forward thing, which is kind of what we’re trying to do with Silicon Real and just feature all the cool people out there and hopefully people listen and get a bit of an education. I think that’s what the beers are doing with all their events.
51:16 So I’m really curious to see how this turns out the next seven months. We’re gonna be following it very closely. Yeah, no, I’m very happy about that and very pleased and thank you so much for having me on. It’s been great. I think what you guys are doing is awesome.
51:29 Thanks, it’s been fun. It was on a whim. It really happened randomly if you don’t know the history. I mean, we had been in London really here for like two years and then I was like, I’ve never done anything about the silicone roundabout. What a douche.
51:40 And so then I found Bryce and then Bryce came on and then boom, boom, boom, it’s silicone round. So it’s crazy how quickly it happened. But speaking of the beards, what’s coming up, Joe, for you guys? You guys are always busy. Wow.
51:51 Well, we just had a big summer party at the weekend, which was fantastically filled with rainwater, which was just great. I mean, it’s lovely today. It was over the day before, it was over the day after. Great. But yeah, we launched our own beer.
52:01 So we’ve got… What’s it called? No, no, no. We’ve got Fail Faster Lager and Minimum Viable Pale Ale, M-E-B-A. See what we’ve done there?
52:10 Yeah. And today we’ve just announced that we will be launching Silicon Drink about Amsterdam on September the 20th. That’s big. Yeah, that’s huge. Fantastic.
52:18 That’s huge. And maybe there’ll be some more locations later in the year. Okay. And obviously, the drink about every week, well, I’ll be there as well. And then you’ve got your Don’t Pitch Me Bros monthly and your next sizzle is probably three months from now, right?
52:30 Yeah. Okay. Thanks for coming on. That’s the toughest seat in the house. It’s very hard to be there.
52:36 You did a really good job. If you’re listening to us on iTunes, you can watch these videos on the YouTube channel, SiliconRealTV or on Twitter, at SiliconReal. We’re really here to feature the people of the community. So if you have any ideas of who you wanna see on here, just email us, let us know. And also, we’re not only gonna have the successes, we’re gonna put a few guys that have failed.
52:55 We want a few guys that have just started up and then obviously the founders and CEOs as well. So we’re gonna bring all of that at you And yeah, that’s it guys, we say it’s about the people at Silicon Real, that’s what you guys said, 90% people. So I’m really curious how this whole program goes and thanks a lot for coming. Cool, thank you. All right guys, take care.
