By Conor O'Neill | January 29, 2007
Thanks to Damien for quoting me in The Tribune yesterday. I thought it was an excellent article both on BarCamp and on raising funds. I’d like to explain my quote a little more here. Basically it concerned the Ã¢â€šÂ¬175m the Irish government have given to a set of VCs here. The VCs have to raise matching funds and then start backing businesses here. Many of us have a problem with this idea and my quote was in that context.
I simply feel that our taxpayers money would be better spent skipping the middle man, forgetting about direct ROI and focusing on helping as many small early-stage ventures get off the ground as possible. The idea of matching funds is clearly based on trying to avoid abuse but it locks out so many people who do not have access to funds like that. How many average wage-earners can find up to Ã¢â€šÂ¬32.5k to spend on an idea and give up their job in the process?
I talked to a French entrepreneur recently and he said that they can get unsecured loans of up to Ã¢â€šÂ¬60k via the government. I’m a big fan of this idea. Irish government agencies should allow every loon, whacko and dreamer to present an idea to them. If it sounds like they can build it then they get a Ã¢â€šÂ¬60k unsecured loan almost immediately. No financial predictions, no market analysis, just a simple “can you really build this thing?”.
For that money they have to build a prototype of their idea. They come back when they are done and if it works, then they get a another block of money. And so on up to a max of perhaps Ã¢â€šÂ¬200k. If they are successful, the loan is re-payed with interest and the ROI for the government is more high value employment and tax revenue. If they fail, then at least they still have a roof over their heads and experience which will be invaluable in their next job.
What County Enterprise Board would have given a penny to Woz and Jobs? Who would have thought a bunch of file-sharers could create a phenomenon like Skype? You want to do what with videos in tubes? There are tons of examples of ideas which on the face of it had no hope commercially. I’m happy for my tax Euros to be spent helping the crazies implement their visions. Most of them will fail honourably, a percentage of them will be gangsters and then we’ll have the ones who change the world. I think it’s worth the gamble and if it doesn’t work out then it has probably wasted less than an average day in the health service.