Start-up star Alexei Dunayev tells Dionne Christian how a simple idea can be built into a global business.
So 2014 is the year you will start your own business but what steps to take to go in this bright, new direction? It's an age-old dilemma but there are lessons to be learned from the new breed of entrepreneurs like Alexei Dunayev.
The 32 year old Ukrainian-born and English and New Zealand raised co-founder and CEO of online transcription service TranscribeMe.com launched the start-up just over a year ago. It has already expanded into new territories and grown staff numbers, offering voice-to-text transcription services in New Zealand, the United States and now Europe. It employs a 25 strong sales and technical team and around 10,000 registered transcribers who work remotely across the world.
TranscribeMe may be a start-up but Alexei and his team founded the venture based on real-world practicalities that can apply to all new businesses irrespective of whether they're online or not.
He believes the key to success involves qualities like being able to develop a clear and coherent vision and demonstrating a willingness to work hard toward your chosen goal; seeking advice and accepting feedback; having an adaptable mindset and being focused on what you aim to do.
Like writers who are advised to write what they know, Alexei says the best ideas are likely to come from your own circumstances and seeking solutions to a problem you and your family, friends and colleagues have.
"Ideas are often influenced from your age and where you are at in life," he says. "It's all about being open and aware of what's going on around you.
Alexei got the idea, in part, because both he and his wife, architect Dr Alexandra Dunayev, wanted a more efficient way to transcribe notes for their respective university assignments as it occupied a big chunk of time.
Simultaneously, classmate Victor Obolonkin was working on his MSc in Computational Biology at the University of Auckland and using speech recognition technology to make it easier to track endangered kokako birds in New Zealand forests. The two saw a way to apply this technology to voice-to-text transcriptions and, in turn, hit upon an idea for a service they suspected would be useful to a range of businesses and industries worldwide.
Alexei says for him, meeting a human need and servicing customers will always be TranscribeMe's focus. He acknowledges this inverts modern economic theory that success is about outsmarting your competition.
By all means, he says, pay attention to your competition but remember you're in business to do something new: "You're bringing a service to people to the table and that's your mission: it's to serve your customers."
Alexei, Victor, Greg Feerer and the dedicated team who came together at Start-up Weekend Auckland, began business development long before they sat down at their computers. In their case, armed with pen and paper, they listed all those they thought could use a transcription service; then telephoned them and asked. This meant changing their focus early on so, while it's vital to have a clear idea of what your dream is; being adaptable enough to accommodate suggestions, constructive criticism and feedback from customers and mentors is just as important.
TranscribeMe founders initially invested some of their own money, and worked without drawing a salary, before looking for outside investors. They last year received $1.2 million in funding from New Zealand and Silicon Valley investors including the local Ice Angels investment group.
When it comes to businesses like his, Alexei cautions for every one receiving funding, there are as many as 90-95 others who don't.
"I presented to around 500 investors, often in groups, and got knocked back by about 95 per cent of them so yes, get used to rejection but try not to see it like that. I've looked at it as an amazing opportunity to learn from people who are smarter because there will always be someone smarter than you in the room; someone who has already been through a similar experience."
He says looking for funding requires you to recognise and be forthright about the business strengths and weaknesses. This process can allow founders to be more strategic about what they're doing by refining ideas and even if you don't walk away with a cheque, you may obtain good advice and constructive feedback.
Starting any business is about having a passion for what you do and a dream you believe whole-heartedly in. You've got to be prepared for the long hours, the return to the 'drawing board' when things don't go as planned and dealing with the realities of marketing, creating a customer base and financial planning. Often you'll be doing a bit of everything simultaneously.
"In New Zealand, we have an amazing ability to tackle any problem which is just as well because early on you'll be the CEO, the programmer and the office cleaner and, like we did for the first few months, you may not be drawing a salary for quite some time," says Alexei.
"There are a lot of success stories - and success should most certainly be celebrated - but the reality is that there's not a lot of money in such businesses; at least not in the initial stages. You think you're going to make money by selling your business but that may never happen and if you do, that could be a long time coming.
"You're creating something that has not existed; You can't look at it as a 9am - 5pm job because it has to become your life and if money is your main motivation, you'll burn out."
Alexei says business success is about building good habits early on. From the beginning, the aim was to take TranscribeMe global which meant thinking beyond local boundaries.
"We knew we wanted to go global so we did it from the outset which meant we were essentially running two businesses. That was tough because if your customers are online in New York at what is 4am in the morning here in Auckland, then guess what time you'll be up?
"New Zealand is a wonderful place to set up a business, to bring people in because New Zealanders have a 'can do' attitude and they really can do all sorts of things. We have an amazing ability to tackle any problems and to work hard at it. I think that work ethic has developed out of primary industry where you have to, for example, get up at 4am to milk the cows and still be working at 7.30pm. You want that sort of work ethic and problem solving ability when you launch a start-up, but New Zealand is a small market."
What is TranscribeMe?
• TranscribeMe - converts audio and video recordings to text, combining speech recognition algorithm technology.
• TranscribeMe was named Best Tech Start-Up at the ExportNZ Awards 2013
• TranscribeMe has a team of more than 10,000 transcribers, based from New Zealand to North America, the Philippines, Pakistan and Ghana.
• The company is looking to expand its service to China and the Spanish speaking world.
Alexei's top tips:
1: Develop a vision of the future that you want to see, and share it with the world. Don't keep your big idea a secret, share it with people around you. It's likely that you will receive great feedback and develop your idea further with help and support from others.
2: Actively seek advice, and more importantly, listen to the advice you receive. Draw on the experience of your mentors, your advisors, your team members and your supporters. Seek advice that stretches you and makes you grow out of your comfort zone.
3: Focus on what's important, and don't waste time on secondary tasks. Make lists of things to do, prioritise them, and execute relentlessly. Make the best use of your time, it's limited; use it to complete the top priority daily tasks you set out for yourself.
4: Hire slowly, fire quickly. There is a difference between difficult decisions and unpleasant decisions, and firing someone who is not performing is typically the latter. Unpleasant decisions are usually not difficult, so get over it and make the right call.
5: When hiring, remember that A-players hire other A-players, and B-players hire C-players. Only bring A-players onto your team, create an environment for them to succeed, support them in any way necessary and help them focus on what they do best.