The Birth of a Business

The business term 'a startup company', which we became very familiar with during the dot-com boom, has now become a common term.

A startup is a company or temporary organisation designed to search for a repeatable and scalable business model. Unfortunately, it is quite a common occurrence that these companies do not survive beyond their introductory phase.

Most entrepreneurs create startups in order to evaluate and research business ideas, which may lead to the creation of a new product or sometimes even a whole new industry.

For most of us, the image we have of entrepreneurs today has been developed with the help of television shows such as Dragons' Den, Be Your Own Boss or The Apprentice, to name a few. These reality shows, emphasize the importance of being able to elaborate on a business idea, to develop the necessary business skills, and hopefully to get the seed money needed, in order to start a business.

I find these shows very educational and they seem to be very appealing to young people like me. I recently discovered there is a big initiative focused towards helping startup companies in the Information Technology sector to develop their business ideas further and hopefully become successful.

For example, a few weeks ago The Telegraph helped organise the London Startup Weekend. Startup Weekend is an international organisation of active entrepreneurs who focus on founding startups and launching potentially successful ventures. During 2012 they organised more than 600 events in 100 countries around the world.

Those events encouraged application developers, designers, marketers, product managers and startup enthusiasts to come together, share ideas, form teams, build products, and subsequently launch a startup. The winner of each national competition represent their country in an international event, where people from all over the world vote for their favourite startup idea such as their favourite web application.

I'm writing about this because I have a personal stake in the competition - my cousin took part in the recent London event and actually won the UK competition with his team, Smartward, and then came third overall in the international competition.

These startup events are very important in helping bring awareness to the industry and encourage young entrepreneurs to participate and become part of a wider network of individuals and companies who can assist each other in achieving their goals.

By participating in these events, we can build our confidence, meet other people with similar interests and in general develop vital business skills early on in our professional lives.

I am sure we all have a lot of business ideas for a startup or a web application, but those ideas will not become reality unless we decide to take them one step further. I believe that by taking part in events like the London Startup Weekend, we will be making a good start towards turning our ideas into reality.

And finally, as the Chinese proverb says: "A good start is half way to success."

This post first appeared in The Accountant (December 2012)

M for Motivation

When taking the early train into Central London, I see many people commuting. When looking around the carriage, I think to myself, “Where do people find the motivation to get to work?”

<!--[if !vml]--><!--[endif]-->Trying to answer this question, my dad recommended I’d read a chapter from the book “The Upside of Irrationality”, written by Dan Ariely. The chapter of the book was called “The Meaning of Labour”. 

In the book, Ariely talks about experiments he and his colleagues at MIT had carried out. Amongst all the experiments he described, there was one I liked the most.

 Two participants were asked to build Lego robots and they would be paid a decreasing amount of money for every one they made.

The first participant was told that the robots would be kept in a box for later use. He started building the robots and soon enough, after ten robots, he gave up, because he realised that the price of the 10^th robot was half of what he was paid for the first, so economically it didn’t make sense for him to continue.

The second participant was being paid for the robots in the same way, BUT after finishing one, and began the next one; the assistant was dismantling the previous robot in front of his own eyes. The participant was not happy with the dismantling and gradually his motivation to build the robots diminished. Even if he was to be paid the same amount as the first participant, he saw no point in continuing after the fourth robot was built. Clearly, money was not the issue for stopping.

The first participant was able to point at the finished robots and feel pride for what he had achieved. The second participant felt that he had nothing to show for his work and saw no point in completing the task.

I am sure that while reading these lines, you can feel the “emptiness” the second participant felt, when they destroyed his robots. So as you can see, that feeling worked against the participant’s willingness to continue with the experiment.  

This experiment made me look back at my Internship during the summer, where I was analysing time-series of data and producing daily reports and charts. In the beginning, I was focusing on producing the reports as fast as possible. After a while, I noticed that some of the reports were not being used. The reason was that the markets were moving very fast and the conditions were changing all the time, so my work was not up-to-date. I discussed this with the manager and he ensured me that my analysis was of good quality, but as the market conditions change, the reports were “yesterday’s” news. That made me feel demoralized, but this was the “nature” of my work.

It seems that what bothered me the most was the fear that my work was not being recognised, thus impacting my motivation. The reassurance from my colleagues helped me overcome this feeling.

Just as I am writing these lines, I realised that writing this blog is similar to building “lego robots” that may soon be dismantled. Perhaps only my family reads them. Not knowing how many people read my posts can be demoralising, but I am not giving up. As someone famous said: “Motivation is what gets you started. Habit is what keeps you going.”

It seems that the field of psychology can play an important role in helping us develop our own understanding of what motivates us and how to improve our performance. It may also help employers understand that more money is not always the best way to increase productivity and performance.

Ellie Fanis
BPP University College


If you would like to learn more about Dan Ariely and his experiments, please refer to the  page "Taking account of...: Page 4: YouTube...if you want to"

This post first appeared in The Accountant (December 2012)