Is any industry safe from Dublin Techs disruptive force? The Big Read, sponsored by Vodafone.
When Jos White of Notion Capital was recently asked about the Software as a Service (SaaS) ecosystem in Europe, he offered a suitably intriguing response. Every industry is being disrupted by tech, he said. It makes sense for a SaaS business to locate where the traditional industry it’s trying to disrupt is located. Take London for example, the traditionally strong industries like finance, advertising, and fashion are all being disrupted by SaaS.”
The idea that tech startups emerge or choose to locate in areas where their target sector has been particularly strong makes a lot of sense. For one, the insiders who know the industry well enough to spot the gaps and see opportunities for innovation when they arise are already present. Secondly, the customers of the existing industry are likely to be close, and the relevant industry-specific supply chains, infrastructure, and ecosystem are already likely to be in place. So all that remains in a lot of cases is, as Aaron Levie famously Tweeted back in 2013:
Tip: Take the stodgiest, oldest, slowest moving industry you can find. And build amazing software for it.
— Aaron Levie (@levie) 9 October 2013
It comes as no surprise, then, that the recent pre-release of the Dublin Startup Database, compiled by the Dublin Commissioner for Startups, points to a similar trend emerging in Dublin, where long-standing, deeply-embedded sectors like advertising & marketing, entertainment & publishing, finance, travel, and education have become the target of progressive startup innovation:
Which sectors are making the biggest impact globally?
Advertising & Marketing
Largely credited to the creative culture of the Irish and the presence of international digital advertising giants like Google, Facebook, LinkedIn, and Twitter in the city, Dublins AdTech scene has given rise to exciting start-ups like ViddyAd, PageFair, and Popdeem to name but a few.
Entertainment & Publishing
A PWC report published in November 2014 predicted that digital revenues in the entertainment and publishing sector would outstrip traditional revenue sources by 2020, pointing to the need for media organisations to change their business models in order to monetise the digital consumer. Dublin startups like Soundwave (recently acquired by Spotify) and Social Honey are determined to take advantage of this need.
Much has been written about Dublins burgeoning FinTech sector, which might be seen as the inevitable offspring that resulted from leaving a group of global finance and tech players alone in their Dublin Docklands bedroom with the door closed. The merging of these two great forces has led to the creation of some very disruptive FinTech startups: CurrencyFair, TransferMate, and Fenergo.
For many reasons, historical, cultural, and socioeconomic, we Irish are a people that love to travel. For a country of 4.5 million, we are home to the largest airline in Europe and the busiest airline in the world. It follows then that the citys travel tech sector plays host to global multinationals like TripAdvisor and Airbnb, plus innovation labs, international events, and world-class startups like Boxever, MTT, and CarTrawler.
What other trends can we see in Dublins startups?
Beyond the confines of these sectors, a broader pattern is becoming apparent (see Figure 1), with a large proportion of Dublins startup founders opting to develop Enterprise-focused, B2B products as opposed to B2C offerings. Larger contract values, longer customer relationships, complex decision-making processes, and sophisticated buyers broken down into vertical-based target segments are all typical characteristics of the enterprise technology market – one in which Dublin has a strong pedigree, and with which its entrepreneurs feel right at home.
A further noticeable trend coming out of the startup database is the proliferation of companies spinning out of the large tech multinationals in sectors like eCommerce, Big Data, MedTech, and Social Media that have become established in the city. As Conor Stanley of Dublin-based investment firm Tribal VC puts it: What’s interesting about Dublin is the US companies with very senior people operating out of here that are increasing the talent pool. A lot of people have moved from Twitter and Facebook to Intercom, for example. When Dublins startup companies scale up, they will have access to that talent.”
Its an exciting time to be involved in Dublins startup ecosystem: this ever-expanding list of new companies offers a very positive sign for the citys future.