A Quick Q&A with CityFalcon
- Tell us what you do and what sets you apart from the competition
CityFALCON provides personalised financial news by leveraging artificial intelligence, push notifications, and voice technologies. We do NOT create content but focus on user and business experiences using existing content and emerging technologies. Our clients include BNP Paribas, FinTech companies, and retail traders and investors.
Financial services is years behind in terms of technology and client experiences, and we are changing that with CityFALCON. Competition would be a more valid concern if we were operating within the general consumer space, where we would face serious competition from the tech giants such as Google, Apple, Facebook, etc. However, in financial services, we’ve found that our competition is slow-moving and hesitant to implement disruptive technologies. Rather than worrying about these companies, we focus on staying ahead of the new, nimble start-ups; and keeping up to date with the latest changes in technological trends, especially artificial intelligence. We also operate as a lean start-up, maintaining a much more strict cost management strategy which means that we only need a fraction of the resources that the big giants require and control.
- Raising funding is always a major challenge for startups. What is the key to getting investors to back your company?
It has been very challenging for us to raise funds at CityFALCON as an early-stage product company trying to take on the big players in the financial news services world, but we are thankful to have made it through the toughest stage. We’ve managed to raise almost £1m including two rounds crowd-funding on Seedrs. Let it be known that without these people, there is no doubt we would have struggled.
I believe that that there are 2 factors that affect your ability to raise money for a start-up in a risk-averse environment – 1) Relationships, and 2) Fear of losing out.
Relationships – “VCs invest in their friends” is what you’ll hear a lot in the valley, and it’s true in several cases. When you see an early stage investment from a VC, one of the key reasons is usually that it’s based on of existing relationships. You’ll also find examples of people working for VCs who start their own companies and consequently get their first investment from those VCs.
Fear of losing out – If you don’t have the necessary relationships, then this is really the only other way to get funding. The UK is obsessed with traction and ignore other reasons to invest in an early stage company – technology, product, and team. If you can show users and/or revenue, people will be interested in your product. For example, in 2013 Done NGuyen developed the mobile game Flappy Bird, which quickly gained in popularity. By January of 2014, Flappy Bird was the most downloaded (free) game on the IOS App Store, and Nguyen was making $50,000 a day in revenue generated from sales and in-app advertisements. Investors will of course run to invest in such a company.
It’s obviously unlikely to succeed purely on luck and timing, but you will need a bit of both ingredients in your entrepreneurial recipe to accompany your skill and passion.
Being in the right place at the right time can get you connected with the people that will help you, or even give you the impetus for your original idea. This isn’t something you can plan for, but what you can do is put yourself out there to attract the right moment.
Capitalise on the opportunities presented to you, and don’t let the people you meet slip away if you think they can be helpful in the future.
The majority of the time I’m pitching in the UK, I ignore the problem/solution format and start with traction. Creativity, demonstration of the risk of losing out, strong leadership, and the willingness to form solid relationships with investors will all help you raise the funds you need; believe in your company, and you’ll eventually get that start-up capital necessary to bring your business to fruition. Fundraising is one of the toughest things I’ve done in my life but at the same time it has been very fulfilling.
- Tell us about your decision to use Seedrs to crowd equity fund – and any tips to attracting investors to the platform.
We’ve realised that the people that are most likely to back you are the ones whose problems you’re solving. We chose crowdfunding 1) to allow our users to also become investors, 2) as a tool for marketing and PR, 3) because a platform such as Seedrs allows us to accept small cheques, and 4) mostly because most European VCs that claim to invest at the seed stage are more risk averse than my late granny.
To be completely honest, fundraising is one of the most boring, stressful, and at times, a time-wasting thing you have to indulge in as an entrepreneur. A crowdfunding campaign entails cumbersome but required due diligence, FCA rules, expectations management and interaction with tens to hundreds of small investors. As the sole founder, the crowdfunding months have been quite demanding for me, as I went through the rigours of fundraising while tackling the ongoing challenges of running my business. However, when the progress bar reached our minimum target of £150K, I can’t express how happy, satisfied and relieved I was – all the effort was worth it, after all.
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- What is the biggest mistake you’ve made so far in your startup journey?
Motivating employees who are not money driven
Entrepreneurs are a demanding and highly-motivated breed, with non-traditional factors besides financial compensation motivating their performance. While in principle we expect everyone on our team to be motivated by the same factors, primarily income, this has proven to be far from the case. Entrepreneurs are very different from the traditional employee, and have a much larger stake in the company. Therefore, factors such as interesting work, a stimulating work environment, active growth plans and an entrepreneurial work culture take a larger role in driving our employees. One thing that I have personally learned as the CEO of CityFALCON, is that you can’t always motivate people with money. In fact, I lost one of my star developers in 2015, because I failed to realise he was motivated solely by the quality of work. Money and everything else was secondary.
- Tell us how to attract and retain talent at your startup. Any tips for keeping employees happy?
We have learnt the importance of fostering a stimulating and entrepreneurial work culture, where our employees are constantly provided the opportunity to branch out and tackle new projects, and encouraged to pursue their own self-learning. We have taken active steps to better inform and involve our employees in the strategic decision-making of the company, and solidify our team dynamic through an increased number of meetings and team activities. Traveling together to exotic locations has helped improve the team spirit and boost the morale of the team.
- What were you doing before you set up City Falcon and how has this experience helped you as a founder of a new business?
- Running a start up is hard work – any tips on managing stress?
Control things you can control, and leave others to luck and timing. Keep yourself out there to take advantage of any opportunities. 2) Yoga and meditation 3) Competitive sports – Sports bring discipline, planning, strategy, teamwork, passion, tenacity, self-confidence and acceptance of defeat at times. Granted, taking your mind off your start-up can be difficult, but a 3-hour table-tennis session during weekdays can often serve as an important distraction that will be beneficial to you in the process, 4) Stop worrying about failures and stop getting too excited. 5) Hire quality people around you – Leverage your own strengths and hire people who can compensate on your weaknesses