Tuesday 23 January 2018

Web Summit looks to new markets and eyes sales of €100m

Co-founder with tech in his blood is relentlessly focused on global success

Paddy Cosgrave, co-founder, Dublin Web Summit
Paddy Cosgrave, co-founder, Dublin Web Summit
Adrian Weckler

Adrian Weckler

FOR many, turning 30 is a time for reflection. Career. Family. Weakening knees. For Paddy Cosgrave, co-founder of the Web Summit series of conferences and recently turned 30-year-old, it's a time to ponder the figure of €100m. That is where the Web Summit is heading, based on its co-founders' current business trajectories.

That is where the Web Summit is heading, based on its co-founders' current business trajectories.

"Yes," said Mr Cosgrave. "It's global ambition and we have gone global. This year, we went to San Francisco for the first time. We did two conferences in New York, one in Berlin and two in London. We even did an event in Ethiopia. And we're going in to Asia next year. So yes, the company absolutely has global ambitions."

Two-and-a-half years ago, Mr Cosgrave was putting the finishing touches to a fledgling tech conference from a bedroom with two co-founders, ex-journalist Daire Hickey and young accountant David Kelly. Next month, the Web Summit, employing 35 people, will commandeer the entire RDS for Europe's largest tech startup conference.I

It's not simply fashion or hype. Mr Cosgrave's creation is hard-nosed, grown-up business.

"The biggest investors in the world don't tend to take three days off work and fly half way across the globe for the sake of it," he said. "They will only do that if (they) have an opportunity to find great companies to invest in. On our end, it's a pact, a promise that we will go out into the world and find incredible early-stage companies."

That deals are done is not in doubt. In 2011, the online car-sharing service, Uber, secured almost €30m of funding arising from a Web Summit-related meeting with Goldman Sachs and US venture capital firm Menlo Ventures in Dublin.

"The last three years have been like an MBA on steroids in how to become a VC," said Mr Cosgrave. "Because ultimately, we're matchmakers on a global scale."

While the IDA is regularly associated with the Web Summit as a financial backer, it is Goldman Sachs, Nasdaq and other global institutions which provide the company with much of its muscle, both financially and in terms of influence. This has given Web Summit staff a very different perspective on how to do business. Youth is not a disadvantage: those in the company who deal with speakers or senior attendees are often just out of college.

Mr Cosgrave is not your average geek. There is no hint of an introvert or of someone who might be happy to lock themselves away for days coding software. He is outgoing, social and affable. He is also said to run the company with emotion and, sometimes, a hard line: he is known to tell staff that they are part of a mission and not just a company.

Although principally an entrepreneur and organiser, Mr Cosgrave has tech in his blood. His father recently gave up farming in Wicklow to become a full-time programmer. As a child, Mr Cosgrave recalls evenings in farmyard sheds with his father hosting meetings where the Nintendo game 'Duck Hunt' was put on show for curious agrarian colleagues.

"He used to milk cows early in the morning and get on to the computer when he could," said Mr Cosgrave. "My mother wouldn't let him play 'Duck Hunt' in the house. This led to one farm in rural Wicklow being the centre for 'Duck Hunt' among farmers in wellies."

Mr Cosgrave is more than just the Web Summit's figurehead. He also owns most of the company. The only other two shareholders, according to Mr Cosgrave, are co-founders Mr Hickey and Mr Kelly. So if and when the company is bought, it will be principally Mr Cosgrave who reaps the financial benefit.

Lately, there have been plenty of offers.

"There's been interest, yes," said Mr Cosgrave. "But no way. Now is definitely not the right time. The opportunity is way bigger than just selling up and making money."

Calculating the company's value is not easy. Its last set of accounts showed a €450,000 profit for its first 15 months of existence. Since then, the company's revenue has soared and is believed to be well over €5m. "In revenue terms, we're seeing triple- digit growth annually," said Mr Hickey. "That's an exceptional performance for a company in the tech space that does not make software."

One reason why Mr Cosgrave has little intention of selling up yet is because of the opportunities he sees in bringing the Web Summit model to other sectors. Two in particular interest him: health and education.

"I think we should be in both those areas," he said. "If you look at both of these sectors, they are areas that can be utterly disrupted by software and hardware. If you look at how much governments spend on health and education and then look at the amount that private citizens spend on it, it's a huge opportunity. We're in a very good place where we could bring the most disruptive companies to those spaces, as well as active investors and the media. Once you bring those elements, you're back to match-making with incumbents, investors, government decision makers and the private sector. Software is eating the world. I think we're in a great position to get in here."

Looking through some of the IT processes that the company's programmers have adapted for selling and analysing the Web Summit, it's easy to see the basis of Mr Cosgrave's enthusiasm. Instead of using off-the-shelf software to squeeze conference preparations into, the company has effectively reinvented online tools to cut through common problems that conference organisers – and attendees – face.

Ultimately, there are other things that Mr Cosgrave, Mr Hickey and Mr Kelly are contemplating. Becoming investors is one. Trying to set up a new media entity is another."We'll always have media," he said. "But we've got to be careful. One of the reasons we get good coverage for the Web Summit from international media is because they see us as media-neutral. Whereas TechCrunch, GigaOM and PandoDaily, all of which are influential, just won't cover events that their rivals are involved in."

For now, the trio are working 16-hour days preparing for Europe's largest tech startup conference. The next time anyone looks closely, their company is likely to be worth a lot of money.

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