[15.11.2007 first posted on silicon republic]
A motley crew of 13 of Ireland’s youngest and brightest tech start-ups have banded together under the label of ‘Paddy’s Valley’ and are heading to Silicon Valley in California on 2 December, with the aim of learning from the big guns such as Google and Facebook.

They are also seeking what one company calls “the enormous pile of venture capital looking for a home”.
Paddy’s Valley came about when organisers Damien Mulley, Conor O’Neill and James Corbett looked to Silicon Valley and the numerous investment opportunities there, thinking the trip could help cultivate an enterprise culture here in Ireland. Their motto is: “If we can’t bring the valley to Paddy, we can bring Paddy to the valley.”
Marcus McInnes, CEO of photo sharing website Pix.ie, which is essentially an Irish version of the well-known Flickr, but with more storage to offer, says he is heading to Silicon Valley with the intention of raising a second round of finance. If nothing else, he will speak to investors and find a fit between what his company is doing and what the investment community wants from companies.
“The valley is the hub of where the web happens and a large part of the trip is to soak up the atmosphere that exists out there. “We want to see what people are doing in that region because they represent what is coming next,” adds McInnes.
Joe Drumgoole, CEO of PutPlace, a web-based storage service for digital media, maintains that heading to the US is not symptomatic of a lack of support in the form of initial guidance and incubation centres for start-ups in Ireland.
His company started out in the Project Development Centre (PDC), an initiative by Dublin Institute of Technology, and recently moved to the Digital Hub in Dublin City. “The PDC gave us a small stipend and hooked us up with Enterprise Ireland; I don’t think we would have been able to do it without them to be brutally honest. They gave us so much support in the early days when no one wanted to know about a guy with an idea,” he says.
Much of the funding in the initial days was provided by Drumgoole’s personal finances. So, while he believes there is an appetite amongst venture capitalists in Ireland for a host of medium-range start-ups, he says they are not just going to invest in a person with an idea. “If you can get over the initial product hump, start to generate some customer interest and put together a reasonable management team, you have a reasonable market opportunity. Venture capital has always been available in Ireland for the right types of companies,” he adds.
All these web start-ups are saying the same thing; they are not going over to Silicon Valley as part of a ‘brain drain’ tour group, with the sole aim of netting a buyout from a big US company.
The members of Paddy’s Valley want to capture the spirit of entrepreneurship and investment that is a key attribute of the Californian tech climate, but they need to learn the skills.
“The funding pool for internet start-ups is very competitive and we know that. It is very difficult to even get past the first conversation with a venture capitalist,” says H�l�ne Haughney, CEO of mobile web service start-up, Nubiq.
Any help it can get in terms of refining its pitch, understanding what venture capitalists are looking for and what it might need to do to change its marketing strategy or business models is what Nubiq is going after.
“Talking to people who have been there and done that will really prepare us for next year when we seriously go after funding. You need to be able to define what you should say in those six slides or during the elevator pitch - can you sell your company in those twenty seconds?” explains Haughney. “We all want to be the next Google or Facebook. It is possible if you have the right goal, the right mission and the right team behind you.”
Although the members of Paddy’s Valley are self-funding their journey over to the US, the presence of other like-minded companies, as well as the professional support of Enterprise Ireland, is all-important.
“By yourself it is very hard to penetrate the inner circle of a lot of these companies, but when you go over as a kind of trade federation you get much higher-level access to companies such as Google, as well as the people providing venture capital.
“With an Enterprise Ireland and InterTradeIreland endorsement, it gives you credibility in front of these people as well,” says Drumgoole.
Enterprise Ireland came on board the Paddy’s Valley trip around four months ago when it heard that some Web 2.0 and blog-based start-ups were heading to Silicon Valley, some of which were its clients.
“We thought it would make sense for us to add as much value as we could to their trip through elements such as organising the pre-tour session in Dublin to help these companies with their pitching skills,” says Nick Marmion, regional manager for Enterprise Ireland in California.
It is hard to know if coming back with all these skills and contacts will help the Web 2.0 or ’software as a service’ community in Ireland secure native funding as easily as their counterparts in the more traditional software and hardware sectors, however.
Regina Breheny, director- general of the Irish Venture Capital Association, says, while there is no question that the venture capital scene is more skeptical of Web 2.0 companies, the fact of the matter is: “Technology is technology”.
“They are perceived as high risk, but the rewards are greater and there is a blurring of what is software and what is a service,” she says.
“I would say the venture capital and angel community in the US is much more willing to take risks than the Irish,” echoes McInnes.
“They are prepared to understand the different exit strategy that exists for web companies, whereas the Irish investment scene doesn’t often fit with that. The traditional exit for a web company is to be bought, whereas for a traditional company it is for it to grow.”
Firm only ‘for sale’ if the price is right
It has been through the acquisition of small start-ups that giants such as Google and Yahoo! have continued growth and maintained their reputations as creative powerhouses.
Waterford-based Nubiq began in 2006 as a Waterford Institute of Technology campus company and develops tools such as Zinadoo - which helps people create and promote mobile web content - and Mobiseer, which is essentially a search engine for the mobile web.
H�l�ne Haughney, CEO of Nubiq, sees next month’s Paddy’s Valley journey to Silicon Valley as a scouting trip and an opportunity to meet potential partners or venture capitalists, with a view to entering the US market.
“From a product strategy point of view to operating in the US market, we can find out what we need to do - do we need to find a partner or can we go it alone? It is also with an aim to meet potential partners - people we can network with over there - and to meet with venture capitalists to discuss Nubiq with them and get their feedback and input on the direction we are taking.”
Google is the one company Nubiq wants to meet most because, as Haughney says, it’s a hot time for mobile web discovery and directories.
Development aside, if Google offered to buy Nubiq for a healthy sum, Haughney would say ‘yes’ with no hesitation. “I don’t think anyone would say no to Google,” she says, laughing.
By Marie Boran
Pictured: Marcus McInnes, chief executive of photo sharing website Pix.ie, one of a number of companies going to Silicon Valley to see what they can learn from successful companies such as Google and Facebook