Home to a number of key investors and co-working spaces, it is no surprise that the Norwegian capital has a thriving startup ecosystem.
Endowed with rich natural resources, Norway’s economy has traditionally been concentrated in the energy and fishing sectors. But, falling oil and gas prices has led to a flourish of tech entrepreneurialism in the country over the last few years. Coupled with a government-led strategy to diversify the economy, Norway now finds itself as one of the most attractive locations for founding a startup in Europe. This is reflected in the rapid growth in investment over the last few years. In 2018, total venture funding in Norway reached just over €207 million, an increase from €156 million in 2017 and €136 million in 2016. Investinor, the government-backed investment company, is the most active funder in Norway, while other key investors include, Snö, Alliance Venture, Viking Venture and Skyfall Ventures.
The Oslo Business Region drives the city’s startup ecosystem through pilot projects and events, such as Oslo Innovation Week, Oslo ScaleUp Day and Smart Mobility Hackathon. The cornerstone of the city’s innovation strategy is the Smart Oslo initiative, which aims to deliver ‘a smarter, greener, more inclusive and creative city for all citizens’. At the GovTech Summit in 2018, the Vice Mayor for Finance, Robert Steen noted that ‘high citizen expectations have catalysed the city’s efforts in the digitalisation and innovation of public services’. The city has responded to these demands, establishing the world’s first smart city accelerator, SmartOslo, which connects innovative startups with the municipality. Nikolai Astrup, the Minister of Digitalisation for Norway, will be speaking at the GovTech Summit on 14 November 2019.
Co-working spaces, including Huckletree, Mesh and 657 Oslo offer opportunities for startups to meet, collaborate and grow. In addition, the Oslo International Hub and Katapult Accelerator bring together international founders and expats looking to build startups in the city.
Top 10 GovTech Startups
No Isolation tackles loneliness and involuntary social isolation by developing communication tools and robots that can help those affected.
TikkTalk is an online marketplace that offers businesses, governments and consumers access to interpreters over video and phone conference.
Otovo is a smart energy startup that offers solar panels and installation services for state, commercial and residential properties.
Hjemmelegene is an application that allows patients to book a doctor for home consultations.
Documaster is an information management archiving platform that enables organisations to compliantly capture, process, preserve and instantly access their documents.
Spacemaker AI uses AI technology to allow cities, property developers and architects to make better decisions when designing building site.
Urban Sharing provides a SaaS-platform for micro mobility and shared, urban infrastructure.
Versor – Versor develops software for truly autonomous drone missions, leveraging an expertise in edge computing to turn real-time understanding of the environment into sophisticated behavior.
Sammevei is a smart mobility startup developing a ridesharing platform, enabling commuters to share rides daily with those with similar transportation needs.
Meshcrafts is a cross technology platform for payment and energy management with a focus on electric car chargers.
How to navigate GovTech: an industry obsessed with improving public services and empowering citizens
Last week a PUBLIC portfolio company, Echo, was sold to McKesson.
McKesson is a leading healthcare company for wholesale medical supplies and equipment, pharmaceutical distribution, and healthcare technology solutions, that reported revenues of over $200 billion in 2018. Echo is a free, easy-to-use service that delivers medicines, typically repeat prescriptions, to a patient’s door. Echo’s 2018 revenues – in case you didn’t know – were a little less than $200 billion!
So whilst McKesson is a healthcare giant devoting huge resources to pharmaceutical distribution, supplies and healthcare technology solutions, they still opted to buy Echo instead of developing their own Echo-like solution. Why?
I personally think it was a very smart decision. McKesson now has the opportunity to bring Roger, Stephen and the rest of the Echo team into their ecosystem: if they allow Echo to continue to be obsessed about building elegant, user-focused tech and removing the barriers to prescription adherence, they will make a healthy return on their investment.
An exit like this is great for investors but it is not a new model. Incumbents have been buying innovative technology companies for many years. However, now is the time for government-facing organisations to start looking over their shoulders and turning to tech for growth. We will come to expect more and more of these acquisitions in GovTech. For that reason, it is time for investors to wake up to the massive potential of GovTech. To recap why PUBLIC is particularly obsessed with the GovTech opportunity:
BUY vs. BUILD
This battle – “Buy vs. Build” – has been playing out amongst corporates and government for centuries. With the advent of new technologies (e.g. cloud computing, machine-learning and APIs), smart, obsessed engineers and entrepreneurs can benefit from very cheap infrastructure to develop step change solutions that can perform at a scale and cost-effectiveness never-before available to the markets in which they look to operate. The caveat is that you need to find this smart, obsessed talent and more often than not it is not sitting inside a large corporation or government entity.
Corporates, led by the large tech companies (and particularly the Chinese tech companies) have been quick to recognise this, fuelling spectacular returns for early stage technology companies (e.g. Facebook’s acquisition of WhatsApp). It’s extraordinary to think that some of these acquisitions are even highly cannibalistic, such is the pace of change that threatens those corporates. Think of FinTech, think of eCommerce, think of the restaurant, taxi and travel industries: incumbents across these industries have been replaced or forced to acquire new entrants building on better, cheaper technologies and delivering consumer-obsessed products.
As briefly outlined above, product-focused entrants have transformed every major industry – the public sector being almost a sole exception. But this is changing.
Government and perhaps government suppliers in particular, represent one of the last frontiers for major technological disruption as we know it. Looking at the public sector, we see three key hallmarks of an industry ripe for disruption (excuse the anecdotal examples):
An over-reliance on legacy technologies: 70% of the US government’s $82bn IT budget is spent on maintaining legacy system
A lack of investment in technology: From 2010 to 2015, government IT expenditure was static vs. 25% growth in the private sector
A small number of incumbents dominate: The top ten UK Ministry of Defence suppliers account for 40% of total vendor spend
Governments have traditionally been slow to adapt to new technology and market entrants. Low risk appetite combined with a frequently non-technology fluent buying and policy-making layer have led to public sectors being behind the curve. Added to this, some departments are faced with low managerial bandwidth and financial restraint.
Change is coming, however. As citizens’ expectations rise and public sector challenges become steeper still – mental health, social care and cyber security to name but a few – more and more public buyers are looking to new solutions from new technology. Legacy systems and cumbersome procurement structures can only hold back the GovTech tide so long.
WHY GOVTECH COMPANIES WILL BE SO VALUABLE
When looking at investments like Echo, investors need to understand why these companies will almost always develop better solutions than incumbent players, and hence build attractive businesses that will fuel acquisitive exits:
Good value for money for investors (nascent sector)
Passionate founders (mission-driven)
This last point is critical in understanding why new, well-architected platforms can add such enormous value when implemented across the public sector.
Take Echo. Echo is not just a company when viewed with a GovTech hat on. Echo has the ability to provide Public Health England (PHE) with data that it never had access to before (but desperately wanted). Thanks to Echo, PHE could actually search through data: which patients are taking what medications, when, and in particular where adherence is lowest. Echo could allow drug companies to action product recalls via push notifications. Echo could allow PHE to analyse cohorts of patients by postcode and draw up statistically interesting facts on populations. The examples continue. Whether McKesson knows what a beautiful business they bought is beyond my pay grade, but if they are able to let Echo flourish, we will all as citizens benefit from their great tech, excellently executed.
Here at PUBLIC, we specialise in backing companies with public sector applications, helping them scale across government by reducing the barriers to entry that currently exist. Our platform gives us the insight, power, and capability to take on incumbent providers, therefore doubling or tripling the addressable market for the companies we support. We are passionate about what we are pioneering: creating the environment for any company looking to engage and scale within government. More VCs and investors are joining us in this mission – it’s time for us to recognise the returns, as well as the potential for public sector improvement, that investing in GovTech represents.
Forward Health, a member of PUBLIC’s most recent GovStart cohort, has recently secured $3.9 million in seed funding. We spoke to Forward about how they got here, what they’re doing now, and what they hope to be doing in the future.
Doctors face an NHS overly dependent on inefficient ways of communicating. Rather than using the fast messaging services we all rely on, the NHS remains tied to outdated landlines and pagers. The solutions to which many doctors turn, like WhatsApp, are neither secure nor designed for clinical use. This was the situation facing doctors Barney Gilbert and Lydia Yarlott which led them, alongside Philip Munday, to founding Forward.
They wanted to provide a secure, easy and efficient alternative for clinicians to use – to fix the “broken communication in healthcare”. The idea is that the less time doctors need to spend waiting for messages to deliver, or landlines to be answered, the better. It would mean more time to spend helping patients – this is why Forward designed a secure clinical messaging app for UK-based clinicians.
Is it working? Well, according to co-founder Barney, Forward is already “saving them time and improving the quality of care they can offer to patients”.
For now, the app is being used by 5000 UK-based clinicians. From talking to Barney, it’s clear that this is only set to grow. Forward is currently in their “love” phase. Rather than rolling the app out to all UK clinicians immediately, Forward is determined to perfect their offering first. They want to know what makes their users tick, and be able to offer this from the start. Once they’ve understood what makes the first 5000 users tick, it’s about understanding the first 10,000, and so on.
We asked Barney where he saw the future of Forward going: “We’d like to be the UK’s leader in healthcare messaging by the end of next year.”
And after that? “Scale internationally”.
Forward’s Funding and GovStart
Forward has recently secured $3.9 million in seed funding, courtesy of Stride.VC accompanied by Albion Capital, which will go a long way to helping them achieve what they have planned for the future. As well as being funded by Stride.VC and Albion Capital, Forward is now over halfway through PUBLIC’s GovStart 2018 programme – we asked Forward about its GovStart experience.
Whilst PUBLIC provides its cohort with support by helping them achieve specific goals, Barney stressed it was the “intangible extras” that were most helpful. For them, this included discussions with startups data experts in different areas.
GovStart has given Forward the chance to interact more with other leading entrepreneurs and innovators wanting to make waves in the public sector. This has had a huge impact for Barney and for Forward: “It allows for the collision of ideas. It’s transformative and helps you think in a new way – that’s what is most helpful.”
Alexander de Carvalho, PUBLIC co-founder and CIO, had this to say of Forward’s recent successes:
“We’re so excited to be working with Barney, Philip and Lydia and the rest of the Forward team as they look to solve the huge problem of communication in healthcare today. The best way to improve care pathways and therefore patient outcomes is to build better, more joined-up systems that allow multiple stakeholders to collaborate in a truly connected way. The Forward platform does just that through a beautifully-designed, intuitive mobile app.
“The progress that the team has made over the past 18 months is extraordinary and I can’t wait to see what functionality they will be offering clinicians in the years to come.”
Join us in Paris for the first ever GovTech Summit, where we will discuss how technology innovators are transforming cities and governments across Europe!
Hanna Johnson, former N.10 advisor, joins PUBLIC as our new COO. Hanna talks about her experience and GovTech.
Before coming to PUBLIC, I’ve had a varied career – starting out in management consultancy with Accenture, then spending several years in the charity sector, before moving into Government to spend six years across DCMS and (most recently) Number 10, as an advisor to the PM. The common thread across all of my roles has been trying to make things work better; whether it’s a business process, a donor-charity relationship, or a public policy.
PUBLIC is, to me, the next step in that journey. The team have already done huge amounts in uncovering opportunities through the research programme, investing in and developing some of the best emerging players through the GovStart accelerator, and beginning to build the public service providers of the future in companies like Panopticon and Free Up. But there is so much more to do. I think it’s clear that some sectors – notably health – have been quicker adopters of new tech than others. And there are other areas, for example policing, where there is still a long way to go. What I think is a great opportunity though is that we now have Secretaries of State in the Foreign Office, the Home Office and in the Department for Health who have previously been in charge of digital issues and the digital economy. So, now more than ever, we have people in Government who know the value and abilities of the tech sector to deliver, and I hope that that will carry forward in what we see over the next few years. The opportunity for improvement is enormous – and the benefits for the public sector and the UK economy as a whole is so obvious – that it seemed like a no-brainer to me to come and join the PUBLIC team.
The GovTech Catalyst Fund: Supporting & Accelerating Innovation
Bhavin Kotecha and Rachel Guthartz look into the GovTech Catalyst Fund’s first five competitions, exploring the range of innovative startups who address the challenges.
This past November, the Government announced a £20m GovTech Fund to accelerate the development of public sector-focused technologies, in addition to a GovTech Catalyst team, who are responsible for nurturing and cultivating the UK GovTech market. This two-pronged effort will be instrumental in driving growth in the sector and attracting talent – whether internal or external – to solving public sector problems. It is worth noting that this money comes from Innovate UKand is procured via SBRI.
Part of the Govtech Fund will go towards a series of competitions which identify specific public sector challenges and invite startups to offer smart solutions. Ultimately, the competitions seek to “help the public sector identify and work with cutting edge technology firms”. Winning companies (4 or 5 for each challenge) will receive up to £50,000 to develop their ideas, with some companies receiving an extra £200,000 to build their proof of concept. A further £500,000 will be available to exceptional companies to continue product development, and to pilot their solutions in the public sector.
Last week, the first GovTech Catalyst round was kicked-off with the announcement of five challenges:
Tracking waste through the waste chain (opening June 2018)
Tackling loneliness and rural isolation (opening July 2018)
Cutting traffic congestion (opening August 2018)
Deploying smart sensors on council vehicles to improve services (opening September 2018)
The breadth of the challenges is remarkable, particularly in demonstrating public officials’ interest in exploring innovative and unconventional solutions for problems across the public sector. While the Home Office’s Daesh imagery identification challenge has a clear and specific ask, other challenges, for instance Monmouthshire Council’s call to tackle loneliness and rural isolation, are an open-call for innovative, out-of-the-box, thinking. Even more exciting is that there are ten more challenges to come over the next 18 months!
At PUBLIC we’re driven by the desire to bridge the public sector and technology, so naturally we thought we’d spend some time thinking about innovative companies who can address these specific tasks and have put together a list of 22 companies who are meeting the needs identified in these challenges in unique ways.
ASI Data Science: Having already worked with the Home Office to develop a tool which spots and blocks the upload of terror video content, ASI are a natural match for this challenge.
Cortica: Their AI platform uses facial recognition and behavioural insights to learn and operate in real-time the same way a person does. A very cool company coming from Israel with a wide ranging client base, with the right focus could do very well in identifying extremist imagery.
Retechnica: Create intelligent software, specialising in text analysis. They offer a text analytics API and web app that tags your content automatically.
aFFirmFirst: An image control and validation platform, currently focused on accreditation of brands to stop image theft. They will have technology that can approach this problem from a different angle and might consider turning their talents to solving a public sector problem.
DEFRA: Tracking waste through the waste chain
A new technological approach could help record, check and track waste, helping boost productivity, reduce costs, and protect both human health and the environment. The regulatory frameworks in waste planning and management are increasing, and commercial waste management is currently a very labour intensive and paper-based system in lots of large corporates. The industry is crying out for a digital solution to alleviate burdens on staff time, increase compliance (waste crime costs the Government £1 billion per annum), and drive better behaviour for a more sustainable economy.
LegalThings: A blockchain-enabled digital transaction management platform, currently working with the Netherlands’ Government to harness blockchain technology for waste transportation management.
Tillr: Flexible compliance platform that enables centralisation of multiple compliance processes, reducing costs and business risks, and embedding automation.
Zaptic: Provide a digital toolset to automate best-practice workflows and ensure that procedures meet standards in industries with complex supply chains, regulatory requirements, and distributed workforces.
AMCS Group: Provide end-to-end software and on-vehicle technology, enabling smarter more seamless, and digitally-fuelled waste and recycling management.
Monmouthshire Council: Tackling loneliness and rural isolation
The government recognises that rural transport is vital to local communities, and businesses. A technological solution, exploiting vehicles with spare capacity could support rural economies. ‘The Cost of Loneliness to the UK’puts the cost of loneliness to employers at £2.5bn per annum, and over 9 million people always or often feel lonely. There are multiple ways to address vehicle capacity and tackle loneliness, and a combination of some of the solutions below may directly solve this problem.
Drivy: Car rental marketplace which allows drivers to rent cars from people in their area.
HiyaCar: Peer to peer vehicle renting platform which has the potential to become an invaluable service to poorly-connected rural areas.
Neighbourly: A marketplace which connects local community projects with businesses for social good. It’s matching service could be expanded to connect individuals and businesses to vehicles with spare capacity.
No Isolation: Created to tackle loneliness and isolation, this startup develops communication tools tailored to the specific needs of different demographics.
Kraydel: Non-intrusive oversight, and an easy-to-use communication tool for senior citizens.
Department for Transport: Cutting traffic congestion
In 2017, drivers wasted on average 31 hours in rush-hour traffic– a cost of £1,168 per motorist, with UK commuters spending an average £135k commuting over the course of a career. In addition to the direct financial cost, traffic congestion also contributes to loss of productivity, high air pollution in urbanised areas, and poor population-wide mental health. Greater collection and new analysis of data could help target interventions to cut congestion, and reduce its numerous adverse effects.
Teralytics: Offer advanced insights into human mobility, working with telecom companies and data partners to capture more extensive data.
Valerann: Transform road studs into smart, wireless devices which allow detection of hazards, traffic management and data capabilities.
CityScience: Statistically evaluate system inefficiencies and develop clear roadmaps to reduced congestion.
Travelai: Generate detailed data on how people move automatically, using mobile phones.
Connected Space: Partner with organisations to create bespoke solutions, for instance creating platforms to help local authorities do more with their data.
Deploying smart sensors on council vehicles to improve services
Poor quality roads have led to an 11% increase in car breakdowns. With an enormous backlog of repair work, councils need to prioritise the busiest routes and sites near public services. Local authorities also need to be more active in their prevention tactics to address what is currently £30 million a year spent in compensation claims due to poor roads. If local authority vehicles can be equipped with innovative data capture systems, we could understand potholes, litter, recycling, parking, air quality and more in real-time, every day, for no added cost. This could mean reduced service delivery costs and better local services.
Mobilized Construction: Collect real-time data from a proprietary device fitted to dashboard, helping councils repair roads faster and at a lower cost.
BreezoMeter: Using existing or additional sensors, they enable local authorities to monitor air quality. Data is used to inform policy decision-making, facilitating better urban planning.
Wejo: Use connected car data to address challenges from traffic flow management to the availability of parking spaces.
AppyParking: Comprehensive parking app which shows real-time parking availability and collects data from sensors to give insight into parking bay usage and congestion.
Investing in startup-developed technologies like these marks a crucial step in public sector support for SMEs. As Minister for Implementation, Oliver Dowden remarked, the fund demonstrates the Government’s commitment to “providing more opportunities for tech businesses – including small firms – to access public procurement contracts”. We are keen to see how the competitions unfold, how they support a culture of innovation, build Britain’s SMEs, and accelerate the use of new technologies in delivering – and transforming – public services.
The Birth of GovStart: Come Write the Next Chapter
Daniel Korski, PUBLIC’s CEO and co-founder, tells the story of PUBLIC, and of its growth programme GovStart’s conception.
One moment I was walking through the famous black door at No. 10 Downing Street, one of the Prime Minister’s close advisers; the next I was being expedited out through the backdoor, having watched David Cameron’s resignation speech, and then followed him into the ignominy of unemployment.
I walked down Whitehall, wondering what to do next? Should I continue in politics, for example offering my services to one of the campaigns for the next Tory leadership? Or should I throw myself into the post-referendum debates that would help determine what the vote – and Brexit – actually meant? There were, thankfully, plenty of commercial offers. My phone had been filling up with text messages from people I had worked with in the City, offering lunches, coffee and jobs.
As I reached Trafalgar Square, I had resolved to do two things. First, I had to write a searingly honest account of why we lost the EU referendum. I felt I owed my perspective to future generations who would ask what had happened. And I knew that I would inevitably forget details and probably embellish events if I tried to write anything in the future. I also needed it to achieve catharsis; to move on. The article, which was one of the first accounts of the run-up to and details of the referendum, is still one of the most downloaded on the Politico website.
The second thing I decided was to devote the next couple of years to ensure the extraordinary technology-enabled transformation I had seen in sectors like financial services, retail and consumer goods, would also benefit the public sector. I have been passionate about public service all my life. While I have enjoyed stints in the private sector, I always yearned to return to public service, to solve problems for the many. Through work in London, Brussels, Washington, but also Kabul, Sarajevo and Basra, I have sought to deliver better public services, working on issues as broad-ranging as sanitation, energy, trade, and sanctions, as well as military and intelligence reform.
In my time in No. 10, and through conversations with the likes of Elon Musk, Reid Hoffman and Sheryl Sandberg, I had come to understand how the collapsing price of technology and the dissemination of know-how could help solve the most difficult problems.
In Government, we had set up the Government Digital Service, created Innovate UK, built the Open Data Partnership, launched the G Cloud, and supported industries like FinTech, AI, and genomics. Far-sighted predecessors and colleagues like Rohan Silva, Tim Luke, Jonathan Luff and Joanna Shields had backed the British tech industry, from its early beginning around Shoreditch.
But despite this there was still no pipeline of product-led startups that were looking to use their cutting-edge technology to transform public services.
Investors were reluctant to back companies that were focused on the public sector. And Government – ministers as well as officials – were not really grasping the opportunity before them, and were therefore not making it easier for new companies to compete for contracts.
That is what gave birth to PUBLIC and its GovStart accelerator programme. A belief that with a bit of external help – especially the triptych of insight, access and capital – technology startups could help deliver better, smarter and cheaper public services.
And a conviction that if we got it right we would help the UK and Europe position themselves at the forefront of an important digital trend. Perhaps even, in a small way, help overcome some of the challenges of Brexit.
There were, of course, many steps between then and now. Backers like Robin and Saul Klein, Brent Hoberman, Jon and Spencer Moulton, Stefan Glaenzer, Jonathan Marland, and Ned Cranborne, and many others, were key to getting the project off the ground. So were early collaborators like Eileen Burbidge, and supporters like Emma Jones.
Alexander de Carvalho joined as my co-founder and added commercial rigour and digital know-how to PUBLIC’s operation. Mark Lazar designed the GovStart programme from scratch, even though he had sworn, following a few years at Techstars, that he would never run another accelerator programme. Caroline Makepeace built the wiring of the organization and Edward Elliot made us known far and wide. Our PwC secondee Bhavin Kotecha brought much-needed financial modelling to our business.
Mentors like Bill Crothers, Theo Blackwell, Matthew Trimming, Ruth O’Neale, James Stewart, James Steventon, and Stephen Heidukewitsch, provided expert advice. We have since been joined by my former colleague from No. 10, Max Chambers, and Andy Richardson, the former VP of Technology at Thomson Reuters, who is our CTO.
As we looked to set up PUBLIC I traveled to the US and across Europe to look at different models and see how best to build the premier GovTech ecosystem. I was particularly impressed by Civic Hall and BetaWorks in New York, Brent Hoberman’s Founders Factory, The Family in Paris and Matt Truman’s TrueStart. I took the best from these and sought to adapt their advice to the particularities of the public sector. Corporate partners like AWS, Mishcon de Reya, and PwC helped further. Perhaps most importantly, was the response from the public sector. From No. 10 and HMT, Secretaries of State and junior ministers, from the Cabinet Secretary Jeremy Heywood, and Civil Service CEO John Manzoni, to GDS chief Kevin Cunnington, as well as PermSecs in many departments, there was nothing but support for what we wanted to do and achieve.
Besides the triptych of insight, access and capital, we now support companies with product development and fundraising, as well as PR and marketing. We also invest in companies, either because we want to follow-on companies from GovStart that go on to raise, or because we see a great startup outside the cohort that we want to back.
We have worked with many departments and mayors, like the West Midlands’ Andy Street, to open the public market for new solutions. And we’ve learnt a lot along the way – not least which departments are genuinely open to change, which frameworks and bids matter, and which digital programmes will actually deliver results.
The last GovStart cohort won contracts worth millions of pounds, received help to build or refine their products, support to ensure compliance with GDPR and cyber requirements, met ministers and officials, and learnt how to sell into the public sector – both when the public sector knows what it wants and when you have to persuade decision-makers and buyers that the best option is one they didn’t even know existed. We have – with the help of Microsoft – published research reports, which have sought to demystify the nature of public procurement.
In the process, we believe that we have, in a very tangible way, helped improve public services.
And that last point is what PUBLIC and GovStart is all about.
Alexander and I are clear: PUBLIC is a mission-driven business. Profit is our discipline, but not our purpose. We are primarily motivated by the promise of transforming public services through the magic that innovative technology companies bring. And so we cannot wait, as we open the applications to GovStart, to see the many ways that a new cohort of companies will seek to transform public services.
We have written the first chapter of GovStart, along with companies like Adzuna, Pockit, Eyn, Cera, RedSift, Flynotes, AsktheMidwife, Novoville and Calipsa. Come write the next chapter.
PUBLIC’s Programme and Marketing Manager Edd Elliott provides four quick tips on effectively communicating your GovTech idea to investors and the public sector.
PUBLIC receives almost a pitch deck a day. Many are fantastic, bursting with innovative applications that have huge benefits for the public sector. Needless to say, however, not all spring from the screen.
Communicating your company’s idea effectively is vital for everything from gaining business to securing funding. So many GovTech startups, however, overlook this key skill. It’s understandable: why agonize over a few sentences when you have a product to build! Time is always short for a startup – so use this cheat sheet of four quick tips on communicating your idea effectively.
On average, audiences read eight words per slide. That’s the same number of words as the last sentence. If you want to get noticed, you need to explain what your company does and why it does it quickly and efficiently – whether it be in writing or speech. Wondering how to do this? Practice explaining your company in:
One Written Sentence (no more than 18 words).
One Written Paragraph
One 30-Second Spoken ‘Elevator’ Pitch.
One 2-Minute Spoken Pitch.
Have these in your backpocket and communicating your startup becomes a lot easier.
Problem First, Technology Second
“Problem first, technology second” is a mantra members of central & local government repeat constantly when talking to startups. What does it mean? Public sector buyers want to know first and foremost that you are solving their problem. How you solve it – technology or otherwise – comes second.
Don’t fall into the trap of over-emphasising your technology: many startups do. Even if you’ve spent months slaving over your new chatbot solution, it isn’t, for the most part, what interests government buyers. Prove that your solution can viably solve a problem, whilst saving time and money – then begin to sell them on machine learning/blockchain/smart-sensors.
Demonstrate You Know the Sector/Domain
To gain any confidence that you are capable of solving a problem, you have to be able to demonstrate that you know that particular problem inside-out. You will not win over investors or public sector buyers unless you can show that you have an intimate knowledge of the sector or domain you are looking to transform. Lots of great GovTech entrepreneurs come out of the public sector looking to solve a problem they have encountered. If this is true of you, do not hide this fact. It is the quickest and best way to give your company credibility – and a clear area of advantage entrepreneurs have over incumbents. (NB: If you haven’t come out of the public sector to form your business, be able to demonstrate you have done the necessary research: you have talked to domain specialists, you have advisors who are experts in the sector.)
Avoid the Tropes
For an industry hell-bent on fashioning the new and creative, startup culture is remarkably infected by cliched language. In fact if a business could be constructed that generated revenue everytime a startup introduced itself as “We’re the Uber of…” or “We’re like Airbnb but…”, it would be well on its way to unicorn status. Don’t overuse the term disrupt; don’t create a quadrangle and insert your company in the top right. Anyone who has been to more than one Demo Day will find it tired and tiring. Just be clear and concise about your company, using terms anyone can understand. Clarity and honesty will be refreshing for investors and public sector buyers alike.
4 Tips for GovTech Startups Looking for Investment
Finding investors is always hard. Here are four tips to help your GovTech Startup find the right investment.
Seek investment from those who share your sense of “missionism”
When you are looking for capital, make sure that you raise money from investors who share your vision and are prepared to back you to deliver that vision. Breaking into a nascent market like GovTech requires patience, trust and support. Starting your journey with the wrong investors could prove detrimental when you look to raise further capital or ride out the inevitable bumps that all start-ups experience.
Pools of capital are increasingly available (e.g. in the form of grants) that you can access and the mindset of traditional investors and wealthy angels is also starting to change.
Make sure you know your customer inside-out
Knowing the public sector is important when it comes to gaining investment as a GovTech startup. If you haven’t worked in government or for a government agency, you should try and ensure that you either find a co-founder, or prioritise hiring someone early, who has worked in the space (e.g., doctor, fireman, local government official etc.). That person must have:
the domain expertise.
a foundational understanding of the specific problems your technology can address.
a plan for how your solution can fit into existing workflows.
perhaps most critically, a commercial sense of why a civil servant will procure your solution.
If you are unconvincing on any of these points, you should expect to receive a hefty amount of skepticism around your business plan when approaching investment.
Economy, Efficiency, Effectiveness
The National Audit Office uses three criteria to assess the way in which spending is allocated in the civil service – and investors will also be looking for you to explain how your business satisfies these requirements. Economy: Explain why your solution represents the best value for money. How can it help a department to deliver a required service on budget, on time and alongside other resource constraints? Efficiency: Can you demonstrate how your solution will offer an acceptable return on the money and resources invested? Effectiveness: Can you convince a public-sector procurement officer that your solution will deliver what it is intended to deliver?
Convince an investor of these three things and you will have taken a large step towards gaining investment.
Develop your sales pipeline
Few things give investors more comfort than the realisation that you have lined up a clear pipeline of potential, paying customers. Starting to work on your sales pipeline early will often help you iterate and shape your solution for the better. You will also develop more confidence in your business plan which will be apparent in subsequent fundraising meetings that you have. Having customers lined up – both public and private – will always go down well.
Public brings together experience from the public sector, technology and finance to help startups solve public problems.
Everyone deals with the state. You register to vote, receive treatment in hospital and apply for licenses. Some of our interactions are regular: sending in our tax returns each January, for instance. Others are a little more irregular: registering a birth, or a death in the family.
Scaling our interactions with the state up or down according to circumstance should be as easy as shopping on Amazon. Unfortunately, the kind of transformation that we have seen across a range of markets — from retail and banking to food delivery — has yet to considerably impact many public services.
Public sector services are often slow, rarely on mobile, and often struggle to adjust to citizens’ ever-changing needs. There are fantastic pockets of reform, both locally and centrally. However, whilst new technologies like AI and blockchain are much talked of, public services have yet to adopt these technologies (and others) at scale, if at all. Incumbent vendors still dominate public sector deals, and most digital entrepreneurs give the often imposing public sector market a wide berth. The result is a far lower quality, and a far higher cost of service than what citizens should expect.
When we first met over lunch, we quickly recognised that the situation could only be remedied if we could get more technology startups and digital entrepreneurs to focus on public sector problems. And to do that we needed to help provide them with the right combination of insight, networks and capital. And that’s why we built Public.
For us, the kicker was simple: if we could succeed in bringing smarter, more efficient technology solutions to government, we could dramatically improve the costs of delivering services to all citizens and transform the experiences that we have when dealing with our local or state governments. Having spent many amazing months refining Public’s proposition and building out the Public team, we have never been more convinced that our hypothesis is strong and that we have a unique opportunity to meaningfully impact public services in the coming months and years. We hope you will join us in our journey. Daniel Korski and Alex De Carvalho, CEO & CIO
Join us at The GovTechSummit in Paris on 12 November 2018 to bring entrepreneurs to the public sector!