First bona fide pitch to investors. New for them, and new for me too. I have plenty of experience with world premiere’s, at least in educational terms. I present ways of thinking, concepts, and so on, to kids in mathematics classes. Yes, most of the concepts are known, most from the last few hundred years, nevertheless they are new and fresh to the listeners. An Ecosquared pitch is a world premiere for first time listeners.
From an introduction by Michelle at Business Gateway, Finlay listened to Ecosquared and invited me to Perth & Kinross’ Angel’s Share event. There were five companies pitching, ranging from a website that enables group booking (nice solution), a lighting company producing back-lit tiles and a zero-volt supply system (cool tech), a craft distillery (very professional set up), and an electronic tagging system using NFC (a clear future market for this). And Ecosquared, the value-tracking app.
how d’it go?
I gave myself a 4 out of 10. My lawyer said it was excellent, and the LINC representative thought so too, and the gateway investor who gave us a Pitch Perfect training day last week also thought it was great. I gave myself a 4 because although it went well enough, it didn’t bring the audience close enough to the actual WOW of what Ecosquared is. I believe that if I can do that, a quality of response will be evoked. Literally, an inspiration. If we get that, we get investors signing up.
Let’s be clear about this. It is not putting down my skills. Not at all. It’s about the challenge of heightening listening such that people can perceive A) what ecosquared is and B) the potential within our reach. I don’t provide a vision. Or at least, I point out enough that the vision occurs to the listener. The connection is made in the listener’s mind, not mine. And I am not ‘making’ this connection in their head either.
I gave myself a 4 because I crossed the boundary, and mixed my vision with their perception. Does this make sense? Actually, it doesn’t need to — what matters is that people see its potential, and when they do, they can’t help but be amazed by what they see. The true inspiration is in their mind. This is not an esoteric point — it goes to the heart of Ecosquared: can Ecosquared deliver a non-intrusive rating system? It’s not about pushing, and advertising, and shouting; it’s about listening, valuing, and acting on one’s values, whether lolcat amusement last week or political votes once every 4 years.
I had a few conversations with investors afterwards. Some were impressed enough to suggest they would like to share Ecosquared with a few associates. Others were still struggling with the premise of Ecosquared, specifically the Gift-Mechanism. We talked a little, and I will follow it up with sharing the mathematical model of the GM. The math is solid; I’ve no problem with that. It’s the debate around the psychology which is the issue.
I’ll also be sharing the prototype with them. Very close to tying up the FE to the BE for today, but couldn’t quite. Looks like Friday. I am a great believer in experiential learning, whether it is learning to ride a bike, or algebra, or Ecosquared. My only worry about the prototype is that people won’t be able to see beyond the rather clunky interface. Like the first cars appeared noisy and smelly, so it took some enthusiasts to see beyond that and to exploit its actual function.
Best result of the day? Finlay at the end mentioned that the guy doing the photos — constantly crawling around throughout the whole 3 hour period — said it was ‘amazing’. For some reason, I find that has brought me the biggest sense of satisfaction. Of course I’d love for the investors to love my presentation and invest in Ecosquared — and I hope they will! Nevertheless, there is something very satisfying about hearing a positive response from an oblique angle, from someone who couldn’t help but be engaged. What do you think? Is my observation misplaced?
Get working prototype — if you want to test it, stick your email in the landing page — ecosquared.co.uk
Respond to any invitations to speak to investors, through LINC or otherwise.
I’d rather keep presentation to a minimum just now. Once we get £60k, have a working beta app by the end of summer, I will be happy about shouting it from the rooftops. For now, dealing with the shocked response in people is… not realised fully in a positive sense. Yes people are engaged and interested, but they are often overwhelmed as they try to simulate it in their own minds; the mental furniture of the current economic system gives little room for manouver. And I have noticed, beyond the genuinely open-minded, quite often the more intelligent the person is, the more contradictions it triggers, whether investors or intellectuals. Then again, flight is a rather tricky thing to get your head around, as is a bicycle if you think about it — certainly before a century ago, such things were simply flights of fancy.
Steve Jobs called a computer ‘a bicycle for the mind‘ — hear it in his own words. Ecosquared is a social bicycle. £60k gives the world an accountable, enumerated gift-economic a go.
It has taken a season to vet lawyers and accountants and assemble all the pieces for a business proposal. Could it be faster? Of course, but not given the current financial landscape and my lack of qualifications (being a math teacher doesn’t open up a world of connections in the adult world…). That’s three months of no income. I’ve read about other start-ups that haven’t had revenue for a couple of years, and they even have the audacity to promote a ‘lean’ business methodology. That’s not lean, that’s starvation-lean! And since they are heralded as successful on linkedin, it means they are being patronised by a parent company, and for me that’s cheating.
In business speak, I am now investor ready. Now it involves facing risk, or the perception of risk.
some basic math
The history of risk makes for fascinating reading, eg Against the Odds. I have always been drawn to the particular conceptual framework around probability. Three things stand out. First, teaching young minds probability is a real eye-opener. Any adult takes for granted that flipping a coin produces a 50/50 chance, getting an Ace of Spades 1/52. But this wasn’t God-given; this is mathematical application, and it doesn’t come naturally to young minds. Why not? Second, probability is contained within statistics, and I hate statistics since it is overly applied and misapplied. Third Bayes Theorem, something I have dived into over the years, and still have not been able to ‘tame’.
At the core of probability is time, at least for the applications that attract my attention. It is the perception of future events, a way to enumerate possible futures to help guide present decisions. This is fine for certain mechanical systems, eg cards shuffled in a deck. But not that useful for a system which involves consciousness. Just look at the Prisoner’s Dilemma, and thats a simple case. Its the capacity of participants to second-guess outcomes which elevates such systems beyond the complexity of purely mechanical systems. Whether it is a class of kids, or investors playing on the stock market, complex dynamics. Chaos Theory 101.
what is a business plan, after all?
It took me months before I realised what it is, or at least half of it is. Costs. A business plan is primarily a summary of future costing. It is the basic burn-rate of a company over the coming year, at least. That’s half of it. The other half is smoke-and-mirrors.
Whatever anyone says, a business plan attempt to forecast future adoptive behaviour — will people buy the thing or not? Sure, if your company is a new brand of ice-cream, there’s reasonable data out there to base your figures on; stock only one line on the shelf versus three wide, will influence whether the tub is picked up or not. But introducing the very notion of ice-cream is quite another — Steven Johnson’s mentions this in his excellent series which also makes for fascinating viewing.
When it comes to innovation, genuine market-creation, forecasting adoption figures is entirely speculative. Appreciation of risk is nowhere near a mechanical affair. And yet, it may have an equivalent level of simplicity to it, especially when faced with lack of evidence.
so how does an investor decide what to invest in?
I only know one bone fide entrepreneur who managed to win £110k from an investor match funded by Welsh government after months of stressing; within the year, the money was gone and he had established his original invention wasn’t viable — and he was going for a second round! A consequence of our current enterprise system is that once people invest, especially government bodies, it is hard to pull out until they get their return. Which results in investors and governments being reluctant to enter an investment relationship in the first place, introducing more checks and compliance tests at the outset, thus inflating initial costs. A nasty feedback loop.
This is biggest problem, as all entrepreneurs know, the stepped investment route. Originally, I asked for £30k, but this has grown to £60k, and it has been suggested I put together a £125k business proposal to reach the ‘lower boundary’ entry for VC’s. Again, what happens is that while the vast majority of entrepreneurs are ‘genuine’, wily ‘serial entrepreneurs’ know how to stay on the treadmill, just look at this outrageous trail of mayhem.
The consequence? The entrepreneurial scene, for investors, is like the stock-market. Few invest in the actual product or service of a company, it is merely a numbers game where stock goes up and down. The only difference being, perhaps, investors are betting on people, not companies. More like horse-racing gamblers than poker-players. And as a 45 year old ex-math teacher, I’m not the youngest horse in the paddock.
ok, what’s the simple answer?
It comes down to this: Has it been done before? If not, can it be tested, and how much will that cost?
Ecosquared is simple. Very very simple. And it is entirely natural. Given our current state of institutionalisation, however, it appears ‘counter-intuitive’ to the point that it is invisible. I watched Mel Gibson’s Apocalypto last weekend again, for all its flaws it is a truly remarkable blockbuster; have you come across the invisible ships proposition? A Gift-Economic evokes a similar response from members of a 3,000 year culture based on a transaction-economic.
First and foremost, it takes an acute mind to see Ecosquared. Certainly, I have found paper to be a terrible medium; however, I do find that everyone I engage ‘gets it’ in person. Still, this requires effort because it is mistakenly understood as ‘an idea’ rather than ‘a tool’. Once we get a prototype, and people experience it, even a child will get it — why? because we all grew up in a gift-economic, its entirely natural.
Second and more importantly, it takes courage to appreciate it. For an intellectual, this means admitting how new it is. Experts find this hard because they make their living based on what they do know. For an investor, this means acting on it, ie investing.
Most investors want to know how they are going to get their money back. Which is entirely reasonable for most kinds of investment — new brands of ice-cream say. However, with market-creation, as we have shown above, the rules are different.
We got first prototype running for under £1500, and I use it to track my engagement with people. Didn’t turn the light bulb on with investors. So, approaching the end of £3k and close to second version prototype. It will be clunky, chances of it going viral are slim, but it will reveal a glimmer of its potential. To the right people this will be enough. Enough for a £60k experiment which might show a greater acceleration than any bit of technology in history.
And besides, in a gift-economic, risk is a misplaced factor. I will leave that for another post to describe.
This won’t excite anyone else on the planet, but I noticed it.
I was replying to an email from Scotland’s talent scout for Angel’s Den. His email went to the heart of it — understanding Ecosquared, explaining it, and trust. For the later, he’s actually introduced me to a colleague of his from Oak Team, to check the worth of our system, before he can approach individual investors. So far so good — though if we were operating Ecosquared, all this would involve moneyflow.
I finished my email thanking him for his candour — I am so glad I am operating in Scotland! — up-front and honest is the way I like it. And I mention (in parenthesis) that I am recording it. I sent off the email, and went to the Ecosquared Prototype app and dutifully recorded my evaluation of the engagement: partly for his observations (he said it was a waste of his time or it was brilliant), and partly for what was evoked in me (genius is in the mind of the beholder). He’s second on a specific list of people (the people I have introduced to the app, not the core group), and fourth in terms of SQ. I sat there, checking the evaluations, how people compared, and thought yes, that’s fair, at least from my point of view. And is the SQ fair? Difficult to say since there’s not enough density of engagement. SQ matches my evaluations just about perfectly with the exceptions of Colin and myself.
And then this happened. I closed the app and noticed that it was on a side page. I flicked to my home-page. I use Ecosquared all the time. I like using it. It is useful to me. Yup, home-page is where it deserves to be. Here’s what it looks like now:
Gmail, Maps, a torch (I have used this a few times, very practical), and now ecosquared. What did it replace? Google Play Store. Yup, it ousted one of the Google products. Question is, will it ever replace one of the docked apps? Phone, Chrome, Camera, Settings…?
ok… anything slightly bigger to share with us, David?
In the wider world, things are going relatively well. Jorge is making headway with the back-end coding of the Gifting Mechanism. My God it has been a rigmarole getting a server and server-admin, and we’ve got a new URL to operate in the background. All his work is being hooked to the front-end, so we should have something to see pretty soon. All very exciting, in a back-end kind of way.
Meanwhile, I’ve spoken with Kevin from the Alba Innovation Centre. Once before Christmas, and twice since new year. He’s set up a meeting this Friday with an IP specialist and a regional manager from Scottish Enterprise. We agreed last week to meet at Kevin’s offices in Livingstone Tuesday. At his request I have been writing up a business plan over Christmas and New Year. Finally I have succumbed to ‘business sense’. Business Plan, horrible thing for what Ecosquared is, wrong tool. It reads more like an academic paper, nearly 50 pages. And on Monday, I decided to pivot, the lean-business term to basically signify a change of direction, taken from basket-ball I believe. I forked a business plan exclusively concentrating on the Gifting Mechanism. Much more succinct, and much more attractive to investors.
Mistakenly thinking Livingstone was south of Glasgow, I thought it sensible to make a few appointments in Glasgow to make the journey from Dundee worthwhile. I called up three angel investor groups, two responded positively: Lancaster Capital (the chap running caught me when I got my first knock-back last year; there’s a story behind that which I will go in to one day if that avenue turns out well), and Kelvin Capital. Meetings went well. Why? Because of the maths! I’ve modelled the Gifting Mechanism using InsightMaker. Take a look at the following.
I’m not going to explain it. Perhaps it will make sense to you, or perhaps it just piques your curiosity. But it sure is exciting.
My parents have been ill. Influenza of some sort. They are rather old, and it has floored them. My father in bed for a week with aches in his bones. Illness like this makes them age visibly before my eyes. My mother hobbling around, coughing to the edge of the very end of her breath. I’ve seen news reports about flu and how significant it is to that generation, but only in person does it have meaning. Honestly, their mortality is visible, to themselves too. Definitely a wake-up call.
Why mention this personal thing in this Ecosquared blog? Because the thing that is missing when I talk to people is the real experience. Adults are so used to simulating things in their heads, with business plans and financial projections, etc etc. The level of misunderstanding that Ecosquared triggers is very very basic. People think it is about ideas, on models. It is not. It is based on genuine, real relationships between people. Friend, family, living relationships, of blood, of feeling. This is why it will work. Not because it is commercial. It is real. It is an accounting system which tracks genuine value between people. And old people in our society deserve all the help they can get. Ageuk is one of the charities I’d like to pull in for the soft-launch in Easter.
It’s less about age, it’s more about wisdom. If the app doesn’t help us generate a sensitivity to wisdom, then it isn’t worth it.