Not just money, investor helps with market access
Big step forward in vision to develop SAP-level business software at Asia prices
REZA Ismail (pic), director at Rofarez Solutions, has a big dream for his software startup: “Our vision is to develop SAP level business software, deliver it on the cloud, akin to flying in a world-class airline at AirAsia prices.”
Having what the folks at Silicon Valley like to term as a BHAG (Big Hairy Audacious Goal) is one thing, but having the potential to pull it off is something else.
But Reza at least was able to convince the folks who run Microsoft’s BizSpark startup program that he has something special in him for them to sponsor his participation at DemoAsia held in Singapore earlier this year.
Reza was one of only 12 BizSpark companies from Asia that were sponsored by Microsoft to participate at the event where startups launch their products to an audience of potential investors.
So how did he find the overall experience at DemoAsia? Although he gives it the thumbs-up, he felt that it could have been organized better. “However, being its first time in Asia, I understand that the organizers would probably need an event or two before getting it down.”
This was also the opinion of Chun Dong Chao, a partner in Singapore-based Crystal Horse Investments which has made seven angel investments in Malaysia, including iBilik.com. Crystal Horse is also the official fund manager of Angel's Gate, Asia's first reality TV series with a focus on business and entrepreneurship.
Chun felt the event did not meet his expectations but also put it down to it being organized for the first time in Singapore. While he expects an improvement should it be run again next year, at this point in time, it is unclear if DemoAsia will be held in the Lion City next year.
Part of Chun’s disappointment was down to the fact that he already knew most of the investors attending the event – which either points to the fact that the pool of regional investors interested in tech startups is quite small, or that the widely-traveled Chun just has a large network.
Interestingly, five of his investee companies did receive funding after DemoAsia but Chun says he can’t honestly point to DemoAsia as being the deal clincher. “The discussions were already ongoing before DemoAsia, so I can’t pinpoint the event as the catalyst for their subsequent investments.”
However Reza can. “I actually found my angel investor at DemoAsia.” For someone whose pitch had not been well received up to that event, Reza is predictably over the moon.
“The investor wanted to diversify from the current business he is in and also saw that he could add value to use by helping market out products in Singapore and the region. For me, I not only get an investor but someone who can help me with market access,” says Reza.
In the following Q&A, Reza shares a bit more about his motivations for launching his start-up at http://www.dappleworks.com/ and what he has learnt along the path less traveled.
DNA: Where have you worked before and what is your domain expertise?
Reza: Main companies that I have worked with include Formosa Prosonic Industries, MYOB, Malaysia Airlines and CIMB Bank. My domain expertise is definitely software development. Right now I'm focusing 100% on cloud software development.
DNA: What problem are you trying to solve and what is your motivation or reason for wanting to solve this?
Reza: We want to develop great software at an affordable price, hence our vision. Our focus is to provide easily accessible business software for small businesses that will empower them to run their business more efficiently.
As we all know, with the cloud model, software is not purchased outright, but somewhat 'leased'. Therefore businesses can slowly shift their IT expenditure from capex to opex (capital expenditure to operational expenditure). The idea is for them to start using software like using electricity, where you only pay for what you need.
DNA: Describe your product/service and is it any different from what exists in the market?
Reza: We are providing cloud-based business management software. Our product is in its infancy right now. Our current release is an employee services portal which includes Human Resources-related items such as Employee Data Management, Online Leave, Claims, Timesheet and Resource bookings.
We are in process of developing more business apps such as Invoicing, Accounting and Payroll modules.
There are many of these apps available in the market. But not many are fully integrated in one platform; or delivered via a cloud software-as-a-service (SaaS) model, which enables us to host multiple clients in a single application instance – and this in turn saves us a lot of cost hosting the application.
Thus we are able to transfer our cost savings to the customer in the form of a very affordable subscription model.
Not many are also staying true to the web business model. Our apps are free ... for a limited number of users. If you have a larger organization or require more transaction capabilities, you pay for that.
DNA: Where is your funding from and how much equity do the founders still hold?
Reza: We started off self funded and only recently have partnered with an investor from Singapore. Our founders still hold a majority equity of over 50%.
DNA: How long have you been at this?
Reza: I formed the company in December 2010, but only started actual work about mid-2011. So we've been doing this for just over a year.
DNA: What has been the toughest hurdle so far?
Reza: Toughest hurdle is finding good programmers to help code this monster!
DNA: How do you keep yourself motivated?
Reza: Knowing that if I am successful I will be able to provide my family with a better life.
DNA: What has your experience with VCs/angels been like before you raised angel funding from DemoAsia?
Reza: Not well received :)
DNA: What have you learned about being an entrepreneur so far?
Reza: In this day and age, nobody wants just another idea. It's a cliché but talk is cheap. You have to at least get to a stage where you can showcase your product and go from there.
Being a technopreneur focusing on software products actually makes it worse. Your products are intangible, just a bunch of code. People will throw money at you if you are building a condo.
So you have to find a way to at least make your product 'virtually' tangible somehow.