I spent my first half day at the SoMa Hub yesterday.  Along with a rather nice BBQ on the roof, my motivation for turning up was to listen to Diego Alcaino talk about his government’s rather novel approach to sparking entrepreneurial behaviour in Chile.  

Diego kicked things off by explaining how this is a politically inspired pilot program that is aimed at attracting entrepreneurs from around the world to come and set up business in Chile.  They are interested in what Entreprise Ireland might call High Potential Growth Startups although Diego didn’t quantify what this meant in terms of turnover or potential employment capacity.  They rather keep a broader view simply looking for companies which have the capacity to grow fast and play on a global scale.  

The nuts and bolts of the program are these:

• The Chilean government is seeking to attract 25 startup companies to move to Chile by offering a $40k grant. 
• The grant can be spent on anything from founder salaries (up to $2k per month) to advertising or hiring local talent.  There aren’t any real restrictions here so long as you don’t spend it on a world cruise.
• The cash can be provided upfront as a lump sum or on a monthly basis.  A guarantee is required in the upfront scenario in case you don’t use the money to fund your startup.
• You are required to attend local networking events in Chile in order to promote communication between the local entrepreneurs and the successful applicants.
• The founders themselves have to be based in Chile for at least six months.
• There have been about 60 business plans submitted, of which 6 had been accepted and are already in Chile.  They are looking for a further 19 startups to join them by the 22nd of September.  
• This is a pilot program that will expand to 1,000 entrepreneurs should the initial program be a success.

Applications are processed within 2 weeks and there seems to be a rush on to get entrepreneur down there are soon as possible.  An applicant can be anyone from someone with an idea to an already trading company.  

A local visa and help opening bank accounts and acquiring documentation is provided as well as an office space in the centre of Santiago although the venture can be based anywhere in Chile.  

Aside from the financial incentive, here are the headlines as to why you might want to think about Chile as a base for your startup in any case:

• It is widely perceived as one of the most developed economies in South America with a stable government and good infrastructure. 
• While Chile has a reputation for being more expensive than neighbouring Argentina, prices on anything from engineering talent to legal advice and living expenses are about 50 – 70% cheaper than you might find in Europe or CA.  
• The time zone is somewhere between the US and Europe, making marketing to both territories feasible.  

I was pretty impressed with Diego’s presentation.  I got the feeling that this was a program that was been driven from the department of the Economy directly as an election promise.  Diego seemed to be a political appointee and there was a definite sense of excitement about the program as a different innovative approach to boosting Chile’s position when it comes to creating startups.

The one previous Global Meetup went down fairly well.  It seems like a good opportunity for people to pitch their business, regardless of where they are, right to the heart of silicon valley.  This month’s event has an international focus and when I saw that no-one was organising the London leg of the show, I thought I’d lend a hand.  We have a great sponsor TheFlyingBurrito.co.uk on board, and so far there are about 20 people interested in coming along.  I have about 10 people interested in pitching on the night. The format will be as follows:

5.30:  Brief introduction and thanks to our sponsor The Flying Burrito.

5.40: Pitch #1 + scoring

5.55: Pitch #2 + scoring

6.10: Pitch #3 + scoring

6.25: Pitch #4 + scoring

6.40: Pitch #5 + scoring

6.55:  Announce our winner

7.00:  Link up with live podcast + streaming of the show on u-tube

8.00:  Wrap up + drinks next door.

The scoring will consist of asking the audience to rate the presenters pitch, and concept idea. We’ll (roughly) average the results and mark each person accordingly.   The person with the highest score will go forward on to present during the show.

If you would like to come along – register here.  Drop me an email if you’d like to present.  There is a £5 attendance fee payable on the night.

Why am I doing this?  Well, to be honest, I’ll be heading state-side in a couple of weeks, and I thought it’d help raise my profile a little, so when I get there, I might get to hit the ground running in terms of meeting some interesting folk.  Lets see if it works.

Sugar and Spice started off 7 years ago as a preserve export business but while jam started to go out of fashion, a sideline cookie business started to pick up. Frank’s background in corporate sales obviously forms the backbone of their success. Having initially supplied a few local providers, when McDonalds approached them they actually had to turn the international behmoth away for lack of production capacity. Interestingly McD’s took an interest in the Chicago born entrepenuer and invited him in to explain his plans for future growth. “They literally saved me from making the biggest mistake of my life” Frank told us as he explained how the management in McDonalds helped to edit the designs for what was to become an 800sq m. production facility in the heart of Bunos Aires.

In the early days it was all about building client lists and calling them weekly to see if he could supply product to grocery stores, supermarkets and local newsagents. As time went buy and demand picked up he had to classify the clients by size as it became too much of a strain to call every single customer. The top clients got a weekly call, while bi-weekly and monthly clients got less attention. Nowadays the clients tend to call him but there is still a lot of face to face meetings to keep the ‘old fashioned’ customers happy. “When I stopped calling around to a few stores, I noticed a dip in sales”.  He took on a sales rep to help keep in touch with customers while he turned more of his attention to keeping things running smoothly back at base.

I was fascinated by the the idea of the cookie business because the third party stores provide such an excellent sales channel. When I first saw Levi Roots receive funding on Dragons Den I began to realise what a wonderful business supplying food to supermarkets could be. The value of each purchase is small but it repeats and creates a beautiful cashflow.  Convincing our clients to upgrade or sign up can feel like a hard won battle, person by person, but in this sector, once you are on the shelves, the product literally sells themselves.

If only there was a way to put a website on a supermarket shelve and have people come along pick up copies. Of course there are drawbacks. Getting paid is getting a little trickier than it was as with all businesses that invoice rather than accept payment upfront. He had no regrets though and when asked if he would sell his product online he made it quiet clear he was happy to let his customers deal with the end customers. A short lived cookie home delivery catalogue soon got the boot when he found himself trapsing the streets of Buenos Aires trying to find the house he was due to deliver 2 packets of cookies too.

Branding seems to be the other key to success. While early on, the supermarkets looked for their own branding, now the Sugar and Spice name has established itself. Supporting a number of local charities that Frank himself is involved with no doubt helps to re-enforce this brand. This brand found its beach head market in the local expat community.  Sponsoring local meetups helped to establish demand and Sugar & Spice still sponsor the sweet table at local events to this day.  For the moment there doesn’t seem to be too much in the way of competition for his ‘premium’ cookie. Consumers seem happy to pay up to three times as much for his slickly packaged product as for the cheaper competition.

What I took most away from the talk was undoubtedly how ‘work a day’ they’re success had been. It was obvious that a lot there had been a wide range of marketing activities used over the years, not all of them successful, but in reality it was all about gradually building up the business day by day rather than coming up with some kind of master plan for world domination.

There is still plenty of room for expansion in Buenos Aires but Frank hopes to expand his line abroad in the coming years.

• What tasks can be oursourced?
• Which websites to use?
• A walk-through of outsourcing a job
• How to specify a job correctly
• What sort of savings can be made?
• What are the common mistakes?

Why don’t business plans shoot for enough money? Fresh from the excellent bizcamp.ie I was struck by how many people there were stuck on investment as a model for building their business. Along with investment comes almost inevitable gesticulation when it comes to market size and potential revenue generated.

Is it not cool to generate enough money so you can have enough of all of the above?

New to the group was Ana from Event Elephant who had some great contributions in the evaluation section of the forum. Des from WithU also made his first appearance.

What stood out at this event was a review of our first ’sprint’ event. A sprint is a small project of about 40 hours of work undertaken between meetings. In this case, Simona, Priscilla, Niall and myself kicked off by trying to come up with an intellectual property product to be sold online. Niall works as a voice-over actor and the plan was to find out of coypwrite material online, record it and sell the result online. It was inspired by an idea an old friend of mine had seen work successfully for printers off-line. We worked up a project plan …

The idea was to create a product that could generate an income long after we had finished spending our fourty hours on it. We had an initial meeting to decide on what material we would record. We were mostly working from titles found at http://www.gutenberg.org/. An initial plan was to chose of the popular self-help books like ‘The Prince’. We soon figured out that a book on world domination written by an italian might not go down all that well in an Irish accent. Instead, Simona did some research on popular search terms that would suit an Irish accent, such as ‘leprechaun’ and ‘banshee’. There was good traffic for these keywords so we chagned tack and selected a few old irish fairy tales.

Recording the stories themselves proved to be the most time consuming part of the exercise. We had a final project meeting on the night before the mastermind to try and pull everything together into a sellable product. The result was www.irish-story.com. How much money will we make? That is hard to say until some traffic has built up. We did at least get something up and running with not a lot of effort. Its just a question of how long it will take to recoup that effort.

So what shortcuts did we take? Well I guess you’d have to be there find out. Most of the project went according to plan apart from the fact that we had to abandon plans to sell the book on iTunes as only audible.com is allowed to supply books to the Apple company.

You can check out Simon’s slides below.

| View | Upload your own

As a wanna-be rich entrepreneur myself – I was glued to every word. Although he may not be MBA professor material – he undoubtedly has a firm grip on the mind of an startupper. About half way though his presentation – he began to debunk some of the mantra’s professed by the Rich Dad crew. Keith started off his training career with Kiyosaki but its obvious there was a parting of ways at some stage. In southern tones, he started to dismantle the concept of “passive income”. In his own words he described the concept as ‘monumentally stoopid’.

I have to admit – my heart skipped a little when I heard him say this at first. I’ve been harping on about creating automated passive incomes for more than a year now and to hear someone with that kind of track record come out against the concept had me wondering. Of course- it was maybe more of a headline grabbing technique than it may first appear. Keith talks about leveraging your effort rather than creating a passive income stream. There is always work associated with money flowing into your bank account. At the very least there are accounts that need to be signed off. Of course – at the beginning there is far more than that to be done. Creating a passive income requires a massive effort. Like trying to manually push a fairground carousel into action – you need every ounce of energy to begin with. Even when the edifice is slowly making circles, you still need to keep an eye on it – pushing the odd horse as it floats by to keep the momentum up.