Business IT Online: David Cruickshank
David Cruickshank became bored of his consultancy job and now runs Business IT Online. He tells us why
David Cruickshank was travelling in New Zealand with his wife when he realised that he was tired of his job and that there must be something better. He now runs Business IT Online and says that since going it alone he has never looked back. Name: David Cruickshank Age: 29 Business: www.businessitonline.com Type of business: Online small business software Start date: January 2004
When did you first decide you wanted to start your own business?It was whilst travelling with my wife in New Zealand in 2003 that I realised my consulting job wasn’t fulfilling me. Setting up a new business is the ultimate challenge and that is what I look for in my life – big challenges and opportunities. I haven’t always wanted to run my own business but once I considered it as a serious option I have never looked back.
Tell us about your businessBusiness IT Online is an online small business software application. We believe that the days of installing software on local computers are numbered because the costs are too high. So we supply software-as-a-service over the internet, which has many benefits to our customers including low costs, anytime/anywhere access, real-time data use for multiple users from multiple locations, free automatic upgrades and data backups and an extremely secure environment for their very important data.
Was it your first business idea and where did it come from?No, not the first, I rarely go a week without thinking of a new business idea! However, this one is different because it came from work done for our clients. We started off in business by building tailor-made software applications for clients and we found that most of them were battling with local IT infrastructure issues and were paying large user licence costs. They told us that it was costing a lot of money and that a low cost method was definitely needed.
Was your decision to start a business inspired by any other companies or individuals? If so, who? I was initially inspired by Stephen R. Covey’s book ‘The 7 habits of highly effective people’.
What makes you think there’s a market for your business?Online software is becoming more mainstream as pioneered by larger vendors such as Salesforce.com. Internet-usage is growing and Broadband uptake is very fast. Remote working is more common and small businesses need reliable and affordable software. All the signs are very good.
Once you’d decided to start a business, what did you do first? I knew I wanted to start a business, but back in 2003 I didn’t know what kind of business. So my main objective was to speak to people who were already running a small business. I was still working in a big company and I wanted to get perspective on what I was thinking of doing.
What research did you do?I spoke to as many small business owners as I could and I networked like crazy. I found that there are a lot of small business communities and that the environment is totally different to working in a large company. People want to help and there is a lot more genuine altruism. The research showed that although our target market is not all that technically savvy, many are definitely on the look out for more affordable and convenient software.
What advice did you seek?I sought marketing advice. My business partner and I do not have a marketing background and it was clear to me that this was a key area where we needed to learn a lot and fast. We did talk to Business Link and to other advice centres. The information was informative and quite useful, but there’s no substitute to getting out there and learning by doing.
What other help did you get?Friends that had already started up were a good source of help. They pointed out pitfalls to be avoided. Websites such as this one are great for a breadth of information and advice.
Does the government need to provide more help to people trying to start a business? I do think that the government could make it easier for startups and small businesses. As I’m sure your readers are aware, a lot of the red tape does provide a disincentive to startups. Cutting down the red tape around areas like setup, employment and PAYE would make a difference.
Talk us through the process of writing your business plan. We didn’t get any help and we didn’t use software – but I did download a few samples from the Internet. It took a few weeks and we still revisit it every six months or so. If done properly, I don’t think it is ever easy for a startup to write a business plan. It took a lot of discussion and a lot of thought.
How useful has your business plan been and do you think you’ll stick to it as your business begins to grow? Writing a business plan was important for us. Not because we specifically needed the document but because it helped us to focus. It is easy to lack focus and the business plan helps you to formalise and structure your efforts. We have already diverted from the original business plan but small businesses should expect to do this. Strategy should evolve and the business plan should be used to validate and focus that evolution.
How much did it cost to start the business? £10,000
How did you fund this?Funds came entirely from our own savings
Similarly, how are you funding your running costs until the business takes off?We have used revenue from tailor-made software development projects to fund the running costs of the business and this has worked quite well, although it has felt at times as though we are running two businesses.
Have you made any provisions for business not being as prosperous as expected? Please explain them. We have a solid client base for our tailor-made software development service. That area continues to bring in a healthy revenue.
When did you stop working?I stopped working 3 months before starting up. I wanted to take a break and get my head clear. This was quite a big step for me. Going from an environment where everybody is telling you what to do, to one where nobody does is excellent but also requires a large shift in mindset. The biggest learning has been my interpretation of results. Negative results as an employee are often treated as failures. Negative results as an entrepreneur must be treated as learning experiences and are as welcome as positive results. No entrepreneur will ever have claimed to have not experienced negative results – and plenty of them!
Are you working from home or from premises? We started off working from my home and this kept costs down. It’s not something we wanted to do for too long and when a great opportunity arrived for an office we grabbed it. We are delighted to have found them and they are within a large block, which gives the environment a great small business community feel. We have no plans to move and it is very useful being only a short distance from home.
How many hours are you working at the moment? About 60 hours a week, but you rarely stop completely.
How are you managing your day and what steps have you taking to ensure you’re able to get everything done without working around the clock?The key for us is the weekly management meeting. Most of the activities for the week are discussed and reviewed on Monday morning. From there we have a key list of objectives which we perform and review the following week. Obviously, a number of ad hoc tasks pop up regularly, but they are prioritised and scheduled in – and our shared scheduling module on Business IT Online is a great help for this.
What about staff, is it just you? It’s just the two of us at the moment. There is always more work to do than there are people to do it but that’s normal.
Is the amount of red tape that comes with taking on an employee something that concerns you? We don’t plan to have a high number of employees in the future, although we will need some. Software businesses are generally fortunate not to need a high staff count. There is a lot of red tape with taking on an employee and it certainly does make you put it off as late as possible.
What marketing and advertising have you done so far? We have used Google Adwords, online PR, networking and a limited amount of banner advertising.
Where do you hope to be in 12 months time?I would hope to have released another two software modules on the site and be in the process of considering an international launch.
What are the main obstacles to growth? Marketing. Our market is large and marketing can be expensive. We need to be clever about our routes to market, so as not to blow large sums on inefficient campaigns.
How do you plan to overcome these?We have a number of interesting opportunities to focus on a niche market segment that has a significant need for our product. If we can successfully market to that niche, then we would look for outside investment to fund further niche marketing opportunities.
Tell us about your website. Our business is our website. We worked with a friend of ours who is a creative designer and built it ourselves. It is work-in-progress and will evolve as our marketing message evolves. It is extremely important that it conveys the concept of our software in a simple way. We will constantly be reviewing and improving it.
What are your main ambitions, to make a lot of money or enjoy what you do?My number one motivation is health. My father died young and I found myself living an unhealthy lifestyle as an employee. Although I wouldn’t call myself an athlete now, the control I have over my own time allows me to run a much more healthy lifestyle. Enjoyment is next, although I would say that one needs to be making a certain amount of money to be comfortable and therefore to completely enjoy it.
What have you found difficult about starting up and what do you wish you’d done differently?It has surprised me how long everything takes. I like results, but when you run a business you need to be committed to a learning curve that takes months rather than days and that can be difficult. The feedback loop is riddled with ambiguity and you need to be extremely self-confident in your own ability to assess whether you are heading in the right direction. I think that market research is an area that I would have put more time into. There is nothing more valuable than your prospect or customer’s opinion.
What skills and personal characteristics do you need to start your own business? Self-belief, confidence, determination and organisation.
So what advice would you give to anyone thinking of starting a business?Step out of your normal environment and talk to people who are already doing it. Talk to as many entrepreneurs as you can meet and ask them lots of questions. If you’re still keen, talk to as many prospective customers as you can and ask them what they want from the product or service you plan to sell.