‘Finding the pain’ gets Kiwi start-up Cyberglue out of sticky place

Start with the customer, find the pain in the marketplace and develop a product to address that pain, advises high-tech mentor Tony Seba

A few years ago, despite having great technology and a good client base, Cyberglue found itself mired in a sticky patch.

The Auckland-based software start-up was unfocused and found it couldn’t gain traction in the market. It was also being forced to deliver services around its software, making it very hard to export to larger markets.

Cyberglue was launched in 1998 with the aim of pioneering out-of-the box e-business systems and products in what would now be called the enterprise content management market. It quickly won customers such as the AA, BMW New Zealand, Sovereign Insurance and Finance Direct, as well as others, says director Richard Gill.

“The problem was we were spread over so many sectors. We had really good technology, but it was hard for us as a company to gain forward momentum.”

Sometimes it can be very hard to see a way out of a situation like that, even with the 20 years of high-tech experience Cyberglue’s founders had to call on.

Gill says international high-tech mentor Tony Seba was instrumental in helping the company find its way. Seba, who teaches courses at the University of Auckland Business School, became Cyberglue’s “voice of conscience”, he says.

“We are a completely different company now as a direct affect of his method,” Gill says. “We were looking for change and knew we needed to do something. Gill says he was aware of ideas such as those Geoffrey Moore espoused in 1991’s Crossing the Chasm, which addressed the difficulties technology companies face in moving from early adopter success into the mainstream. But it was Seba, he says, who provided the practical link — the method which allowed the company to achieve success.

Under his guidance, Cyberglue focused on one niche market, membership societies, and delivered a packaged software system that helped such societies manage their member communities. Already the software is winning users, and both Australian and US business success is on the cards, too.

“What he did made a real difference, by opening our eyes,” says Gill. “There’s theory and also a practical set of processes and tools to apply it.”

Every year, the Venezuelan-born Seba delivers short courses at Auckland University, delivering the same material he presents at his native Stanford University in California. He helps his students, mostly mid-career professionals, find a market, package their products and find partners to help those products succeed.

“It’s not a lecture,” he says. “I learn as much as I give. I’m challenged all the time.”

Seba says his students take time off work to do the course and they don’t accept any “BS”.

“I don’t want to solve problems but to lead them in a way of thinking,” he says.

Seba’s advice is to start with the customer, find the pain in the marketplace and develop a product to address that pain.

“By finding the pain you will find folk that need the product and are willing to pay for it,” he says.

Seba’s courses are heavily case-study based. He asks, for instance, why Apple’s iPod turned into such a winner. Most people say it’s because of the brand or the marketing.

However, Apple has always had a strong brand and great marketing, but had never before produced a clear category leader.

Seba explains that the iPod was not an immediate success. It was just one of many players on the market. It was iTunes that rocketed the iPod into category leadership, from October 2003, he says.

It was also iTunes that alleviated the pain in the market and made using digital music, and later other content, easy to access and manage.

Seba says New Zealand companies seem to think that because the local market is small they have to be generalists. He says this is absolutely wrong because to be world class you have to be focused. If you are world class, you can also move into much bigger markets.

For Gill, the few days he spent with Seba made a real and continuing difference. Now, when making important product or market decisions, he asks himself: “What would Tony say?”

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