Business Irish

Friday 17 November 2017

A start-up specific procurement policy will fire enterprise

Continuing our series where business leaders suggest ways of kick-starting the Irish economy, Dylan Collins says we must embrace technology, and ensure we buy from our own startups

'A lot of people tell me that technology frightens them, or that they don't feel qualified to interact with it...'

IGREW up in a small village in Tipperary called Mullinahone, which is known for its ability to produce more county hurlers than most other villages in the country.

As an under-12 hurler I was trained by Jimsy Kelly (father of Eoin), and I will forever remember him hounding me to always follow through with my strike and not be afraid of the sliotar. Today it feels as if the same advice needs to be given to those in charge of stimulating our economy.

There's a lot of talk, in fact some very intelligent talk, but simply not enough action to back it up. For example, The Games Sector in Ireland: An Action Plan for Growth was released by Forfas in October last year.

This report was extremely well researched and contained some excellent initiatives, ideas and suggestions about building on our position as a major European gaming hub. But almost six months on, we've yet to see any taskforce, panel or committee created to bring some of those innovations to life.

Ireland is already home to names like Activision, Zynga, EA, Popcap and many others. The Forfas proposals could make us one of the biggest players in the world. Just what are we waiting for?

Amidst the rather dismal statistics which floated around last year was a rather surprising one: Ireland is now ranked by the World Bank as one of the best places in Europe to start a business. Even more surprising, we were ranked as one of the best countries to do business in (although I suspect the researchers didn't try to get an overdraft while they were visiting).

This is quite a remarkable achievement. In the depths of the worst recession since the Thirties, we have created a genuinely excellent ecosystem for starting companies.

Although it has quite a fondness for paperwork, Enterprise Ireland has created a support structure for new companies which is almost unheard of anywhere else in the world. And for all the startups which complain to me about its excessive bureaucracy, show me another national organisation which provides multiple investment funds, a network of international sales offices and a range of grants to accelerate company growth.

No, Enterprise Ireland isn't perfect, but we would have far fewer new companies without it. And we need as many new companies as possible: they are the commodity which will shoulder the responsibility for resurrecting our economy.

Yet despite the creation of an ideal set of parameters for new company creation, we're still facing 14.5 per cent unemployment rates. So what else can we do?

Startups and entrepreneurs are a function of population size. With that in mind, it would be great if we could somehow double the number of people living here. Sadly, other than kidnapping the entire island of Costa Rica or convincing every Irish woman about the joys of motherhood, this is unlikely to happen in a hurry.

So the question then becomes: what can we do to support and further encourage our existing startups?

There is a rather obvious answer. We can buy their products. I'm not espousing some kind of economic nationalism (at least not one involving tariffs), but rather I'm looking at the position the Government occupies as a significant potential customer. Every year various government departments and organisations spend tens of millions of euro on products and services which could easily be replaced with those supplied by Irish startups.

Not only will many of these startup alternatives be cheaper than the current solutions, but by virtue of age, many are likely to improve the actual performance of the department in question. This kind of startup-specific procurement would need to be managed carefully (particularly in terms of bureaucracy and company diligence), but it has generally worked well in the US. A 'startup first' Government purchasing initiative would boost the revenue of startups, increasing the likelihood they will grow further, contribute to more employment and in turn generate more tax revenue.

Can you honestly give me one reason why our own Government shouldn't buy from our own startups?

A lot of people tell me that technology frightens them or that they don't feel qualified to interact with it.

I tell them the same thing that Jimsy Kelly told me: it's not going to bite.

We simply cannot afford to look at technology as a completely separate world any more. Devices like iPhones and iPads are now used by both our oldest and youngest citizens and it's critical that every one of our leaders, investors and law-makers is conversant in the basic principles which underpin our most important industry.

Let me take a small step in that direction right here. Do you know what Open Source software is? Essentially, it's software -- developed by a community-- which may freely be used by anybody. That's a very simple definition, but easily understandable by people, regardless of their background. (You can read more about it at http://en.wikipedia.org/ wiki/ Open_source). Open Source software is used by virtually every software company in the world at some point -- multinationals and startups alike.

In fact, it's indirectly responsible for hundreds of millions of euro taken in tax revenues for Ireland.

In a country which is rebuilding itself with the help of technology startups the length and breadth of the island, it's critical that every one of our politicians is conversant in the fundamentals. There is absolutely no shame in not understanding how technology works, but it's inexcusable not to seek out some basic education.

I promise it won't bite.

Despite everything, we've created a truly world-class ecosystem for startups and have the ambitions to match, but we seem scared of taking the last step and turning all of this into reality. Perhaps this is due to a lack of understanding. Perhaps it's a simple fear of the unknown.

Ireland is now a major European hub for internet and gaming companies, but we are capable of so much more. At a point where we can lead the world in digital hurling, this is no time to be afraid of the sliotar.

Dylan Collins is executive chairman of Fight My Monster, chairman of Treemetrics and Enterprise Ireland's Startup Ambassador. Previously he founded Phorest, DemonWare (acquired by Activision Blizzard) and Jolt Online (acquired by GameStop); Twitter: @MrDylanCollins

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