IN THIS week's SME Focus we hear from an entrepreneur who found cost and lifestyle considerations convinced him Scotland was a good place to start a business.
What is your business called? doc-department
Where is it based? Leith, Edinburgh
What does it produce, what services does it offer?
Outsourced technical writing and product information services.
Traditionally this would have been writing user guides and instruction manuals ready for paper distribution. Today, our clients need a digital solution. Once created, content can be presented in whatever format is required, from paper through to rich media, for example, videos, 3D images or dynamic content.
Examples of our work include providing information for new and existing customers to the staff members who answer help desk calls from those customers, and marketing information for potential customers who demand more details about the product before making the purchasing decision.
Who does it sell to?
Our clients are mainly small/medium sized companies with turnover from £5-50 million. These are typically software and hardware companies producing products for business.
What is its turnover? £150,000
How many employees? Three
When was it formed? 2008
Why did you take the plunge and what were you doing before?
While studying at the University of Aberdeen I spent a lot of time with exchange students. I was embarrassed that they would always point out how bad UK people are at learning other languages. So much so that after graduating I packed a bag, disposed of everything else I had, and moved to Germany to learn their language.
I spent a year as a language student at the University of Eichstaett before landing my first job at a technical writing company. The company was looking for native English speakers who could speak German and had a degree in Biological Science. I had no idea what a technical writer was at the time, but my profile was almost perfect.
Our clients were German medical device companies, so I got to use the knowledge I had learned during my degree, improve my German, and learn about German business culture.
After that I worked as a consultant with multinationals such as Schlumberger and Roche helping them streamline and automate their product information and user documentation processes. During this time I noticed that I was implementing pretty much the same systems and processes for each client. I realised that if I could make these content production processes available as an outsourced service, companies that previously would not have had the resources to access such processes would be able to compete on par with the big boys.
After a company's website, the support documentation is the place where most customers consume content from the company.
When I decided to start the company I was living in Henley having returned to the UK from living in Germany and Spain.
My flatmate at the time had recently become engaged, so it was time for me to move out. This forced me to think more about where I should start the company. I was self-employed with clients in Germany and the UK, so I was not really tied to any location. Given that that this was a new venture I wanted to keep costs down, and Henley was not the place for that.
In the end I selected Edinburgh. The cost of living is 30 per cent lower than London, property is cheaper and it seems there is a good local market for the company, and there are no direct competitors. Add in easy access to the mountains and it was an easy choice.
One day during my first week of business I was rushing between meetings and got stuck in a traffic jam. I was annoyed, but then noticed the view out over the Forth towards Fife. There was still snow on the hills and I thought if you are going to be in a jam, this was the place to be.
How did you raise the start-up funding?
It has been self-financed. I put £30,000 into the company and rolled existing contracts into the new company. This provided the initial revenues, and profits have been reinvested.
What was your biggest break?
Signing up IndigoVision, which makes IP video security solutions that have both software and hardware components. Edinburgh-based IndigoVision was one of doc-department's first clients in 2008, and we are still working with them today. As an established brand they help provide doc-department with credibility and proof that we can deliver on our promises.
What was your worst moment? The initial purpose of doc-department was to develop a cloud document authoring solution. However, it became clear that doc-department didn't have the resources available for this. So I had to change strategy, a pivot as it is now called, and focus resources on developing the service side of the business.
After the decision was made we made the necessary changes without too much disruption. This meant changing our pricing structure with existing clients. These were difficult conversations at the time, but in the long run it was actually a change for the better for clients and for us.
What do you most enjoy about running the business?
Solving problems. I love the challenges that problems present, both client issues as well as our own business challenges. There are often many elements that need to be brought together including technology, people, processes.
What do you least enjoy?
Selling. I suppose it is a classic issue encountered by people who are passionate about their profession or trade. They would rather be doing what they enjoy than feeling forced to do something that takes them away from that.
My biggest bugbear is overly complicated government initiatives. The cycle-to-work scheme (which lets employees of registered firms buy bikes tax free) is a case in point. A member of staff has recently bought a bike through the scheme so the scars are fresh.
I like the objectives of the scheme; I am a keen cyclist myself but the way it is accounted for makes it a nightmare.
If such schemes and tax matters were simplified, it would be easier for small companies to manage their tax affairs without relying on external professional services. This would help reduce the cost of doing business and lower the barrier to starting one.
What are your ambitions for the firm?
I want doc-department to become the go-to company for product information and user documentation in Scotland.
What are your top priorities?
Clients, staff training, transparency, innovation, simplicity.
What could the Westminster and/or Scottish governments do that would help?
Reduce the cost of employment. As a small business owner, cash is the most important thing to me. Any cash that goes out of the door is less cash to spend on developing the business or staff.