We believe IoT entrepreneurs need to ask themselves a central question: Am I meeting a genuine market need? Answer ‘no’, and we would advise a re-think or event call a halt to their project entirely. Because in our experience there are occasions when a creator’s passion, eagerness or lack of perspective can blind them to the obvious insight – without demand, there is no market (and consequently no commercial imperative) for your product.
The question: Are you providing a solution to a problem? Is front and central for us. Only if an early stage company can answer confidently in the affirmative will we invest.
This logic applies to the IoT transport sector. We can see a clear example when we consider how difficult it is to park in central London.
Traffic is heavy during the day. So you can be looking for a spot, only to discover that once you’ve found one, you need a permit or you have to pay exorbitant fees to park in your desired location. The result is stress and frustration in equal measure.
So, let us introduce AppyParking. An app that uses a smart city platform to show drivers the nearest and cheapest off and on-street parking. Through kerbside mapping the company can enable both public and private sector to manage and control parking for the better. The solution layers a digital infrastructure over the existing road network to add extra intelligence and convenience to users.
Frictionless payment is also a part of the app, delivering a win-win for users and local authorities. Plus, there are environmental advantages. Congestion and pollution are reduced as fuel consumption is reduced along with the time spent searching for elusive parking spaces. A genuine market need is being met and its one of the main reasons that AppyParking was considered a good target for investment by our organisation.
Another reason we backed AppyParking is that we had confidence in the business’ management team. Many founders are big on innovation and passion, some possess the requisite technical know-how. But not all founders show the commerciality and tenacity required to scale their product and business. Plus we look for individuals who are able to demonstrate people management skills and a talent for sales and marketing. In short, we back the best and we expect a lot – but we also offer a lot of support and encouragement in return.
We ask our IoT entrepreneurs to be honest in their self-appraisal and come to us prepared to discuss their strengths and the areas where they are likely to require support in order to shore up their capabilities and progress their business ideas at pace.
With this kind of honest engagement, Breed Reply can really make a difference to start-ups and early-stage IoT companies. Unlike other tech investors, we employ an active operational investment model that sees us getting hands-on with our investees to provide day-to-day support across core business functions.
Wherever you are based in Europe we’re happy to hear from you if you meet two critical critera. 1) Is your business model sustainable and scalable? And 2) Do you solve a persistent market problem?
Get in touch.
(From the blog originally published in IoT Now Trasport on the 29th June 2018)