How To Get Traction For Your Business

Alejandro CremadesContributor

EntrepreneursAuthor of The Art of Startup Fundraising & Serial Entrepreneur

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How do you get and maintain traction for your startup business?

Traction is probably the most important part of launching and running a business today. If you’ve got traction across the right metrics, everything else will take care of itself. The funding will find you, you’ll find a way to be profitable, you’ll attract great talent, and you’ll enjoy what you are doing.

Of course, traction is tricky. Especially in the early days of being a startup, where you can’t just go and buy growth by buying another company that has it. Some will tell new business owners to be realistic and that growth is never a straight trajectory upwards. If you’ve haven’t planned to maintain traction, there will be lots of plateaus.

Yet, today’s investors demand traction. Funding rounds are getting closer together. If you aren’t delivering on your promises of progress and growth, and you only have a 12 month runway, that next fundraising round may be pretty dry and deserted.

In fact you will be expected to allocate one entire slide of your pitch deck to traction. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash. Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).

Traction doesn’t have to be profit. It doesn’t even have to be revenue. Or it may not be in size of customer base. It may not be rolling out the next two products you hoped. It is probably one of these things, though it doesn’t have all of them. Just show the one single metric that determines the health of your business and make sure this metric is growing by at least 10% month over month consistently. Make sure you have been (boldly) realistic with your milestones so that you aren’t always failing on hitting them. As a founder you always want to under promise and over deliver.

So, how to you keep the graphs going in the right direction?

Ask for the Sale

The number one rule of getting sales is asking for the sale. That applies even if you are seeking users for your freemium model startup. If you don’t ask, you don’t get. The one who asks will get the sale.

This can be a trap any and every business, of all sizes can fall into. Some do it because they’ve become too overconfident and lazy. Others are too shy because they are just starting out.

My friend Tim says he just went into the local Apple store on Black Friday, thinking he’d scoop up the newest phone to document his travels. There were no Black Friday sales deals there by the way. There were 20 or so Apple staff in the store, all seemingly playing on their own tablets in groups, and he wasn’t able to make eye contact with any of them. He left the store without spending a dollar.

He’s not a very patient guy, but tells me the same thing happened at Tesla not too long ago. Walked into the showroom, walked around, waited. No one approached him. He left and bought two new cars from another dealer.

Those sellers may appear to be able to afford to miss out on a $1,200 phone sale or a couple $150,000 car sales. Though, what about 1,000 missed opportunities? What about 1 million? What if that happens next year too. What if each person who went to another brand brought at least 250 people from their sphere of influence over to that brand with them?

You’d never do that, right? You’d never ignore a customer. Not one with money in their pocket and ready to make a purchase on the spot, right?

What if they waltzed into your Wall Street office of Fifth Avenue store in their gym clothes? Would you still be bullish about asking for the sale? Or would you let them slip away? What about the thousands of people who probably see you online on social media and pass you on the street every day? Are you actually asking for the sale? Or are you letting them look around your store (or Facebook page or blog) and then letting them hop over to the competition because you ignored them? Worth thinking about.

Pick Up the Phone

Not many people may actually use the phone as a phone any more. That’s what makes it so great. It’s too easy to shoot off an email or DM. It’s too easy for people to ignore those. Now, if you have them on the phone live, and you ask for their help or a sale, it’s a lot harder for them to say no.

As a side note, make sure you are always leaving your cell phone number in your pitch deck at least twice. This is on the cover slide and on the thank you slide. If an investor wants to talk you should make yourself available always regardless of the time.

Control the Press

Press releases are a fantastic way of creating and controlling the buzz around your brand and company. You no longer have to sit there and hope you get picked up by the media. You don’t have to go buy a whole newspaper like Sam Zell or Jeff Bezos. You can use various online platforms to publish your own news. This can be perfect for breaking through these plateaus and staying trending.

Moreover, you should be following reporters that cover your space on Twitter and engage with them as much as possible so they have you top of mind. Leave thoughtful comments on their pieces as well. There are also other tools such as HARO where reporters are constantly asking for sources and being there as a founder to pick up the opportunity when it comes along is key.

Go Where Your Users are

If you are having problems connecting with those you thought your customers and users were going to be – go where they are. Go get in front of them, be hard to ignore, talk to them. Make them aware of your product. Tell them this solution to their product exists. Get their feedback and record it.

Networking events are great for this. So are other industry conferences and trade shows. Thought this can just as equally be applied to your local gym, the boat club, golf course or pub. You can look for events on platforms like Eventbrite or Crunchbase.

Giveaways

Give stuff away. It may not be your main product, if you can’t afford that. Just make it something that gets their attention and is relevant. It’s a great way to show you notice them and to build relationships.

In this regard, you can also pre-sell your product rather than giving it away by launching a crowdfunding campaign on platforms like Kickstarter or Indiegogo. This could also contribute to building a loyal following.

Invite Testers

Whether it’s a popup shop, a tradeshow, or online, getting people to try your product is an excellent gateway to get them to make the leap, and then rave about it. Collect reviews and all the data you can.

Both giveaways and trials can be very valuable when targeted to influencers. Of course, the biggest influencers can also be the hardest to reach. Trying to get Seth Godin to read your book, or Warren Buffett to review your investment algorithm, or Lebron James to wear our clothing may not be easy or fast.

Though there are thousands, if not at least hundreds of micro-influencers who are easy to reach, that will appreciate your offer, and can have a great impact on driving others to you. Many companies are now seeking Instagram influencers as is one of the most powerful engines from an influencer marketing perspective.

If you don‘t have a budget in place to pay these influencers, perhaps you could reward them with advisory shares that have a vesting schedule subject to accomplishing certain type of milestones.

Partnerships & Collaborations

Bigger leaps and hacking traction is easier when you can tap into existing audiences and flows of money. If you could get on the shelves of Walmart, your traction ahead of your next round would probably be incredible.

Ask who it is that has already cultivated a big audience of your target users. Who do they trust and look to for recommendations? Who is already spending money to market to them?

Collaborate on marketing and minimize or eliminate your own marketing expense. Cut a limited time exclusive deal if someone can connect you to a whole store of customers. Exchange content to benefit from that online traffic. Or consider a licensing or affiliate arrangement where you only pay out for leads that are closed.

Ultimately finding powerful organic distribution channels is the best way to grow your company and an unfair advantage to those competitors that are relying on advertising.

Ask for Introductions

Whether it is traction on a fundraising round, users or traffic, ask for introductions. Who holds the keys to these things? Or who knows how to put the right content together to open the doors? Ask for introductions. Ask other entrepreneurs. Ask for introductions on LinkedIn.

Track The Data

You should have tools like Google Analytics or Kissmetrics in place to capture data around how customers are behaving with your service or product. Especially if you are an online operation. By tracking the data you will be able to make better informed decisions and also understand where you need to focus to fix certain issues or where to double down the efforts.

If you are looking for other ways to gain traction and to listen from others that have done it with success in the past, I strongly suggest listening into the DealMakers Podcast to hear how other successful founders have made it, as well as what investors are looking for.

Masayoshi Son finds easy way to make US$1b a year

FRI, APR 05, 2019 – 5:50 AM

The 0.7-1.3% range that SoftBank charges its Vision Fund investors implies Mr Son could net roughly US$1 billion a year in fees – without needing any exits for his unicorns.

MASAYOSHI Son is a very clever man. SoftBank Group, his giant Japanese conglomerate, is in talks with investors to add as much as US$15 billion to its Vision Fund, according to Bloomberg News. The US$100 billion venture capital fund has already deployed more than US$70 billion in tech companies.

Mr Son is right on the money. Even if you set aside the race to spot the next Uber-style unicorn, there are other reasons for wanting to double down on this fast-growing and lucrative part of the asset management industry. Management fees for alternative investing, where venture capital belongs, account for 43 per cent of total payments for asset management services, up from only 17 per cent a decade ago.

The 0.7 per cent to 1.3 per cent range that SoftBank charges its Vision Fund investors implies Mr Son could net roughly US$1 billion a year in fees – without needing any exits for his unicorns. That return beats what BlackRock can make from its smart-beta ETFs. Mr Son can generate the equivalent of one unicorn a year in fees by just selling himself to investors as a tech visionary. And he’ll have no trouble finding new believers.

While endowments and sovereign funds are already heavily engaged in private markets, high-net-worth individuals, pension funds and insurance companies are still new to the field, and will be eager to get more involved. It makes sense for them to diversify.

Still, as impressive as Mr Son may be as a financier, there’s a real danger here for SoftBank posed by the sheer scale of the investment vehicle he has created. To succeed as a public company, SoftBank needs to show it can deliver exits for its unicorn holdings. And for that, it needs a vibrant US stock market, which is the still the go-to place for large initial public offerings.

In the past year, the correlation between SoftBank’s Tokyo-listed shares and the Nasdaq Composite Index has soared to a dotcom era high, a recognition from stock investors that the company has morphed from a telecom operator to a bona fide venture capital giant.

But to keep this reputation, it will eventually need some successful IPOs. And the reality is that the US equity market is far less dynamic than it looks, despite the record bull run. There have been few IPOs in the country recently, while the universe of public companies has been shrinking since the late 1990s. Even the rebound this year wasn’t down to any new inflows. Having a US$100 billion investment juggernaut investing in late-stage tech firms hugely distorts the new issue environment and clearly delays the need for unicorns to seek an IPO.

A market without any IPOs eventually turns into a stagnant pond. SoftBank’s size and success in raising funds is, perversely, one of the greatest threats to its future prosperity.

Plus those buying into Mr Son’s venture capital prowess will demand steep returns. Over the past decade, the S&P 500 Index generated an annualised 15.8 per cent return, and you can access that by paying slightly less than 0.1 per cent in fees for the SPDR ETF. Investors are expecting 25 per cent annualised return from their alternative asset managers, according to Bernstein Research.

Granted, Lyft’s IPO bodes well for new issues overall. But what Mr Son’s investors will remember is that Carl Icahn managed to offload his Lyft stake at roughly 10 times what he paid for it. The bar is high for Mr Son’s own investments. BLOOMBERG

Analysts say the moves could put SAP in a better position for new cloud investments, including untying SAP Cloud Platform from its HANA database underpinnings.

When SAP laid off 4,400 of its employees in early March, the company noted that the restructuring was part of a "fitness program." If the SAP layoffs and published reports indicate anything, it’s that the vendor appears to be doubling down on its cloud strategies — and jettisoning advanced development on its HANA database and ABAP programming language.

While analysts believe that customers will still receive support for products, early signs show that SAP may be more invested in opening up its SAP Cloud Platformto sit on top of other databases in the future.

The March SAP layoffs are not the end of the vendor’s restructuring. According to published reports, SAP cut 446 jobs in the San Francisco Bay Area, the majority of which are software jobs. SAP isn’t the only large tech company letting go of employees: PayPal and Oracle are also trimming their workforces, but not as much as SAP.

A hit to ABAP

The SAP layoffs hit Rich Heilman and Thomas Jung, both highly regarded ABAP developers, as well as Bjoern Goerke, chief technology officer and head of the SAP Cloud Platform business. This may be part of its cloud strategy because, to customize applications in the cloud, developers need to build ABAP on a platform-as-a-service model, then integrate with applications and interfaces — a workaround that would be specific only to SAP because of the proprietary nature of the ABAP language, according to Duy Nguyen, senior director and analyst for applications procurement and operation at Gartner.

Rich Heilman and Thomas Jung were the two programmers that the ABAP community looked toward for help with issues that arose when developing in ABAP, Nguyen said. "Even though there’s a bit of cleaning house, the goal [for SAP] is to look forward and recruit new blood in order to innovate — but then there’s a lot of old-school experts let go because they don’t share the common vision." ABAP is not top of mind when it comes to innovation, he added.

HANA may no longer be a competitive differentiator

One of the reasons why SAP laid off so many of its HANA development staff is that providing a database is no longer a strategic differentiator, according to Joshua Greenbaum, principal of Enterprise Applications Consulting. At one point, HANA was a strategic differentiator because switching from a classic database to an in-memory database was a novel idea. However, the availability of services from AWS, Google and Azure has rendered databases a commodity, he said.

"This is the story of enterprise software: Yesterday’s innovation is tomorrow’s commodity, and tomorrow’s innovation is something you put on stage in front of prospects," Greenbaum said, acknowledging that this is what SAP is doing. HANA and ABAP are no longer strategic, and many consider these to be anchors holding them back, he added.

SAP layoffs signal focus on newer technology, not trouble

Just because SAP let go of HANA and ABAP staff doesn’t mean the company is in trouble, nor does it mean customer investments will be affected adversely, Greenbaum said. "SAP is really trying to refocus itself away from some of the proprietary technologies it was promoting. … This layoff and restructuring in the company is trying to bring the core of SAP closer to the cloud platform world, to the world of modern open source tools and open source platforms," he noted.

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HANA won’t be going away anytime soon, Greenbaum predicted. It’s still the core database for the S/4HANA ERP system and other products, and it runs in the Azure cloud, Google cloud and on AWS. There is no reason for SAP to decouple HANA from its other products at this time. What will affect customers is that SAP is focusing more on business outcomes and less on technology outcomes, a positive for customers.

And as Greenbaum noted, SAP’s competitors engage in reorganizations as well. But SAP received more press coverage due to its more open culture and the fact that a lot of the people let go in the SAP layoffs were SAP Mentors, developers and programmers who were part of an influencer group with more access than the average software vendor. "When these things happen, there’s … a sense of betrayal. … It’s different than Oracle, IBM or a traditional American company where it’s the price of doing business," he said.

For now, it doesn’t seem that existing HANA customers need to worry about their technology being sunset, and SAP’s release of ABAP in SAP Cloud Platform may extend ABAP well into the future. However, the restructuring may also bring more options to SAP customers, as SAP continues with its cloud acquisitions and partnerships with Azure, AWS and Google Cloud.

Asean Fintech – 33% of everybody is in Payment that’s why the space is bloody (as of early 2019). hashtag#fintech hashtag#asean

Vietnam’s thriving startup ecosystem is expected to reach US$33 billion by 2025. But so far, the top tech companies have mostly cloned successful companies elsewhere rather than brewing something specific to Vietnamese culture and society. Tiki is Vietnam’s Amazon, Foody is its Meituan, and VNG is its Tencent.

I’m not saying clones are wrong. In fact, they’ve brought a lot to the Vietnamese society. Today, people have more choices: they can conveniently book plane tickets and hotel rooms, order clothes and other goods, and hail rides on their phones, among a host of other services.

These tech companies are making Vietnam more productive, more accessible, and more open. I’ve been lucky enough to be part of this incredible ride, and I’ve loved every minute of it. But it’s just the beginning.

Thanks to them, we’re poised for the next wave where entrepreneurs steeped in local culture begin creating startups that specifically address Vietnamese issues and problems.

Tailor-made tech for rising economies

Why am I so certain that this wave will wash over Vietnam? Because it’s already happened in other rising economies.

Take China, where I spent 13 years, as an example. The first internet companies there were also clones: Google, Twitter, and Amazon translated into Baidu, Sina, and Alibaba, respectively. In turn, they paved the way for that next wave: products and services tailored to Chinese consumers, born of conditions specific to China.

For instance, while livestreaming apps like Periscope and Meercat floundered in the US, similar Chinese apps took off, with revenue estimated at US$4.4 billion in 2018.

Savvy entrepreneurs there saw the real China.

Peng T. Ong, my partner at Monk’s Hill Ventures, invested early in YY, one of the biggest livestreaming apps in China. Of course, he understood that similar services in the US were ill-fated, but he also knew that China was and is very different. He bet that China was perfectly suited for livestreaming in a way that the US was not.

Savvy entrepreneurs there saw the real China – the one that had a huge and growing population of lonely young singles, disenfranchised from their traditional networks and families. They saw the China where consumers would have a real desire for livestreaming – even if they didn’t know it yet.

In China, many adults under 40 are only children – thanks to the country’s one-child policy – and many are leaving home to work in big cities. Livestreaming created a whole new way to connect and entertain. Singles were no longer isolated or lonely.

Peng also knew that for livestreaming to take off, it had to attract quality creators as well as consumers. YY and its peers pioneered business models to solve this problem. In fact, being a livestreamer can pay better than many skilled and low-skilled jobs.

One livestreamer profiled by Wall Street Journal in 2016 made more than 10 times the average income for her province. Today, livestreaming has created an entirely new job category that has helped lift thousands into the middle class – and ensured that users will have plenty of livestreamers to interact with.

The result of all this local innovation? China now has the largest number of unicorns outside of the US, helping to drive China’s economic growth. In fact, the country is on track to become the world’s largest economy by 2030.

What problems can a uniquely Vietnamese startup solve?

The lesson here is this: cultural context is powerful. Entrepreneurs who can solve big indigenous problems will unlock rapid and sustained growth.

So, what products or services will resonate with the Vietnamese the way livestreaming resonated with the Chinese? What app will create new job categories, bringing thousands and maybe even millions into the middle class?

A farmer in Vietnam / Photo credit: nguyenkhacqui

I don’t know… yet. But I do know that they’re coming. Here at ground zero, I see clear areas where technology could provide uniquely Vietnamese solutions.

Right now, most of today’s tech startups target the rising middle class in Vietnamese cities. Nothing’s wrong with that, but about 65% of Vietnam’s population is still rural, according to the World Bank. That’s a giant new market, and it’s why I think rural Vietnam could become the epicenter of the next boom and help transform lives.

Just look at the impact that Uber and similar ride-hailing apps have had in large urban cities such as New York and Singapore. In some ways, these apps serve as the Robin Hoods of transportation, taking money from big taxi companies and putting it in the hands of the little guys – the independent drivers.

What if entrepreneurs could do the same for Vietnam’s little guys: the farmers? What if they find a way to optimize the supply chain for poor, rural farmers, putting more profits in their hands rather than in the pockets of corporate food processors? What if they create technology that allows city-bound children to maintain a presence in the lives of their rural parents without being physically home?

That could be pretty powerful.

Whatever the solution, there will challenges – from fragmentation and tech literacy to broadband access. But good entrepreneurs see challenges as opportunities. They find solutions to big problems.

Jeff Bezos of Amazon and Alibaba’s Jack Ma didn’t get where they are by thinking small and addressing the obvious markets in front of them. Instead, they had huge, inclusive visions for transforming the lives of everyday people. Then, they worked tirelessly to execute those visions.

So, if the infrastructure to reach rural farmers is lacking, maybe that’s just the opportunity – the same way Amazon built logistics infrastructure capable of same-day delivery almost anywhere in the US.

There are a wealth of possibilities that people living outside of Vietnam simply wouldn’t see. And the potential rewards are huge.

What’s in store? I don’t know. But I can’t wait to see what bubbles up from my fellow entrepreneurs. My door is open.

• India-based startup Oyo Rooms is looking to create cloud kitchen brands as aims to become a full-fledged hospitality chain, according to three people familiar with the matter.
• “Food will form an ancillary revenue stream for Oyo, and they have been experimenting with different models for a while now,” said one of the sources.
• The company is also looking to list the brands on food delivery platforms, such as Swiggy and Zomato, the people added.
• Oyo is currently doing a pilot of its first cloud kitchen under the Adrak brand.

JPMorgan Chase’s Dimon says cyberattacks may be the greatest threat to the U.S. financial system. In an unusually long annual letter to shareholders, the chief executive of the country’s biggest bank by assets said that while it spends an annual $600 million on security — interconnectedness with other institutions make it an omnipresent risk. Dimon also cited continuing efforts in conjunction with Washington to mobilize against it.

The dark secrets of enterprise architecture

Architecture matters too much to entrust to a framework or methodology. But don’t worry: Not having a methodology isn’t a problem; it’s a liberation.

Want to decrease IT costs without increasing technical debt? Enterprise architecture is a good place to start. Want to improve business/IT integration? Enterprise architecture promises to be the tool of choice. How about establishing a more streamlined and effective business? One guess as to where you should look first.

And therein lies a paradox: Improving architecture can drive significant improvements, but the frameworks and methodologies that are supposed to help you improve your company’s architecture rarely live up to their promises. Instead they turn the EA function into an ivory-tower white-paper factory that emphasizes deep, abstract conceptualizing over practical action.

After 30 years of trying to make this work, why do so many attempts at EA fail? The reasons are dark secrets few are willing to acknowledge. How dark? Being metrics minded, I’ll use Ansel Adams’s zone system which ranges from 0 (black) to XI (white).

A word of warning: The darkest secrets come last.

Secret No 1: EA has no metric for success

Zone System rating (ZSR): IV

TOGAF is the best known and most widely used approach to enterprise architecture, so we’ll use it as our stalking horse. In case you aren’t familiar with it, TOGAF stands for The Open Group Architecture Framework. According to the Open Group, “TOGAF®, an Open Group Standard, is a proven enterprise architecture methodology and framework used by the world’s leading organizations to improve business efficiency.”

Which leads to a question: In what way is TOGAF proven? I Googled “TOGAF SUCCESS RATE” and came up dry. So far as I can tell neither the Open Group nor anyone else has even defined a TOGAF success metric, let alone tracked improvement against a baseline.

Secret No. 2: EA pursues the wrong target

ZSR: III

TOGAF claims improved business efficiency as its benefit. But as anyone with an ounce of metrics sophistication knows, “Efficient” is always a ratio — units of one thing per units of some other thing, like miles per gallon, transactions processed per server dollar, or story points per programmer hour.

“Efficient” is meaningless without knowing both the numerator and denominator, and TOGAF provides neither.

This is no mere semantic quibble. Efficiency matters when you’re in a volume business and tomorrow’s markets will look just like yesterday’s markets.

Most business leaders understand that change is the only constant they have, which means flexibility and adaptability matter much more than efficiency. TOGAF’s waterfall nature (the next dark secret) make it a poor choice for achieving flexibility and adaptability.

Secret No. 3: EA is waterfall revisited

ZSR: II

One reason EA frameworks and methodologies fail so often is that they are, in the end, waterfall in nature. They document the current state (a time-consuming endeavor) design the ideal future state (another time-consuming endeavor) and plot a roadmap for closing the gap between the two.

Then, when the world changes, re-plotting everything is just as time consuming. In practice, it means keeping EA involved in business change doesn’t speed things up.

It slows them down.

Secret No. 4: While important, EA isn’t urgent

ZSR: II

Imagine you’re an enterprise architect. Current state, future state, gap, and roadmap in hand — along with estimates of the money to be saved once the company achieves its ideal future state — you meet with the executive leadership team (ELT for the acronym minded) to get funding.

Good luck with that. Just before your meeting, and again after it, business unit leaders also met with the ELT, seeking funding for their pet projects. The ELT compares your request to the other opportunities in front of it. EA’s benefits arrive in an indefinite future. That’s because they’re realized in other, business-defined projects that can’t take advantage of the improved architecture until it’s been implemented, and won’t deliver their business benefits until they complete.

Or, the business projects can launch right now, and the architecture will just have to wait.

Guess what gets funded — especially when the ELT can easily understand the value of, say, improved CRM but have no idea what you’re talking about when you natter on about architecture development frameworks, boundaryless information flows, the enterprise continuum, and the other hundred or so specialized terms and acronyms EA practitioners add to their vocabularies so they can join the Cool Kids Club.

Secret No. 5: EA frameworks can’t describe real-world architectures

ZSR: 0

TOGAF’s foundation contains a fundamental flaw: It describes architecture in terms of a fixed set of four layers: the business layer, application layer, data layer, and technology layer. This has always been an oversimplification — each of these layers has segments and sub-layers.

This is leads to the two biggest and most important dark secrets:

Secret No. 5.1: Platforms are applications — applications are platforms

ZSR: 0

TOGAF’s layered model is just plain wrong. It’s wrong because more and more, platforms are also applications and applications have become platforms. Take SharePoint. You point your browser to it and you’re managing files in a more sophisticated way than you could with shared folders, and, if you want, you can create blogs, wikis, and other interesting stuff.

You can also use SharePoint as a platform for developing general-purpose applications, complete with data-entry screens, workflows, reports, and such. It’s a platform and an application.

Don’t like that example? How about SAP? It and its fellow ERP systems are applications — very big applications. And they’re built to let you define your own data elements and program your own workflows and transactions using them, without violating their structural integrity in the slightest.

They’re platforms as well as applications.

Think this is a minor point? The entire purpose of enterprise architecture frameworks is that they’re supposed to let you accurately and consistently describe architectures. If they can’t do that — if they can’t describe how SharePoint and your ERP suite fit together with everything else you’re running or will want to run — then what value do they provide?

Secret No. 5.2: The missing layer

ZSR: 0

Platforms are applications. Applications are platforms. Modern IT doesn’t just implement and run them. Modern IT integrates them.

Most organizations integrate them with a messy collection of custom-programmed batch interfaces, which go by such names as “spiderweb,” “spaghetti,” and “hairball” depending just how messy they are.

TOGAF has no place for describing hairballs, or for more architecturally sound alternatives like enterprise service buses (ESBs). Which is unfortunate. It’s unfortunate because cleaning up a hairball integration architecture is often the single biggest benefit to be had from improving architecture.

And it’s unfortunate because increasingly, IT doesn’t build applications using just one underlying application as a platform. IT uses the ESB to create a virtual “source of truth” service out of a collection of “systems of record.”

It builds applications out of these services rather than making direct use of application APIs, but won’t be able to use TOGAF to describe them.

EA’s bright secret: Don’t bring me problems. Bring me solutions!

ZSR: 9

Depressed? Don’t be. Just because the most prevalent architecture frameworks and methodologies are a mess, that doesn’t mean you have to live with bad architecture. Quite the opposite. Here are five quick tips.

Perfect is the enemy of good

Okay, it isn’t original. It wasn’t even original when Voltaire took credit for it. You’ll note that Bright Secret #1 promises a ZSR of IX, not XI. The rule here: Don’t even try to describe the perfect future state. Be happy with better and make it happen.

Ask anyone in IT what the top candidates should be (probably, your hairball). They know the answer, and they’ll be delighted to share it. You can get started improving your architecture without ever once documenting your current state or describing your future state in any level of detail.

Think agile

Agile is more than a family of application development methodologies. It’s also a way of thinking. Of particular relevance here are the closely related ideas of iteration and incrementalism. So as you’re setting a target of ZSR IX, figure out small steps you can take right now that will leave the architecture better, not the complete set of steps that will get you all the way there.

Don’t compete with business projects — integrate architecture into them

Those small steps you can take right now to improve your architecture? Instead of competing with business projects for funding, build architectural improvement into the business projects that would get the funding anyway. This way, every IT-related project leaves the architecture in better shape than it found it, with only a modest increase in investment and scope.

And as project sponsors are unlikely to be willing to spend their own budget on better enterprise architecture, you should present to the ELT. Only now you’re asking for an architecture subsidy provided to every approved project, not separate funding.

Use design principles to define what “better architecture” means

Give up on the idea of a complete reference architecture and you’re freed up to figure out what “better architecture” means. Usually it means conforming to a short list of core principles. The hard part isn’t formulating them. The hard part is to not pretend.

For example, just about everyone would agree that eliminating redundancy — normalization — is the hallmark of a good data architecture. Make this a design principle, though, and you’ll just be pretending, because if you’re like most enterprises, IT will buy when it can and build only when it has to. This is, in fact, one of your likely design principles.

And if you buy when you can and build when you have to you won’t be able to avoid data redundancy. That’s fine. Don’t pretend. In a multi-vendor environment the corresponding principle is to document and synchronize redundancy.

Avoid architects

Okay, that’s a bit strong. What you really want to avoid is an EA function with permanent staffing. Do this and you’ll have a hard time keeping it from becoming an ivory-tower white-paper factory. Making it a rotational assignment instead will keep it grounded, because everyone writing and enforcing the rules while assigned to it will have to live with the consequences when they rotate back out again.

In conclusion

Architecture matters. Especially, technical architecture matters. Businesses with clean architectures are demonstrably more nimble and effective than those that lack them.

Architecture matters too much, in fact, to entrust it with the current crop of frameworks and methodologies. It’s too bad, but right now, not having a methodology to fall back on isn’t a problem.

It’s a liberation.

Top Fintech startups in Singapore

As the startup scene in Singapore goes from strength to strength, we take a closer look at some of the city state’s up and coming fintech companies in 2019

Financial Technology, better know by its portmanteau, fintech, is in the spotlight.

The Singapore Fintech Festival, which took place in the city-state from 12 to 16 November 2018, brought together more than 40,000 participants from over 100 countries.

The event is the biggest gathering of the global fintech community and attracted names of the calibre of Christine Lagarde, managing director of the IMF, or Narendra Modi, India’s PM.

In 2017 alone, Singapore received USUS$229.1 million of fintech funding and two of the continent’s biggest deals took place there in Q4. Venture capitalist firms are also taking note of the fruitful startup landscape, with investments up 60% on the previous year.

With 490 fintech startups now calling Singapore their home, it’s clear that emerging businesses are aware of the opportunities presented by the city-state and want to capitalise on the benefits they have to offer.

Below is a roundup of some of the biggest and most innovative fintech startups in Singapore.

Validus Capital

What: peer-to-business (P2B) lending platform for SMEs

Funding: US$15.2 million in Series B

Founded in 2015 in Singapore, Validus brings together accredited individual and institutional lenders and SMEs.

It obtained its Capital Markets Services (CMS) licence from the Monetary Authority of Singapore (MAS) in December 2017.

The startup announced recently that it successfully raised US$15.2 million in its Series B funding round. The investment was led by FMO, Netherlands’ public-private development bank.

ShereIt

What: White-label social trading network for stock brokerage firms

Funding: US$17k over the seed round

ShereIt (formerly Bw8 Trading) is a mobile-based social trading platform for stock brokerage firms. It allows users to communicate with other traders around the world in a real-time and transparent setting.

ShereIt helps amateur traders find the best business partners through its social networking platform. Leveraging on the feeds of top traders, investors can learn about new strategies and different sectors. Beginners can follow a range of traders and learn about different trading styles which will help build their own knowledge and skills.

BetterTradeOff (BTO)

What: fintech and insurtech startup that offers a “one-of-a-kind life planning solution to reflect the unique lifestyle of everyone

Funding: S$3.4 million over two funding rounds

BTO uses advanced statistical models and AI to help individuals make better decisions when attempting to finance their future. It was formed in 2015, and is now available in Asia, Europe and Middle East.

Toast

What: Peer-to-Peer money transfer application

Funding: US$865.93k in 2 rounds from 4 investors

Founded in 2015, Toast is a mobile application that allows Filipinos in Hong Kong and Singapore to send money home to the Philippines via their smartphone. TOAST’s USP is that it transmits your money quicker than traditional money transfer shops and cheaper than banks.

TranSwap

What: cross-border payments that enables businesses to make transfers at the mid-market exchange rate obtained from third-party sources like Bloomberg and Reuters without a mark-up

Funding: US$1.2 million during initial funding

Recently awarded the Gold Award for Payment Tech Category (Startup) at the Institute of Financial Technologists of Asia (IFTA) Fintech Achievement Award Ceremony 2018 held in Hong Kong on 26 February, TranSwap helps small and medium-sized enterprises (SMEs) streamline their payment processes and make foreign payments at the most competitive rates to more than 45 countries.

Quoine

What: Financial services powered by blockchain technology

Funding: US$123M in funding over 3 rounds. The latest funding came from an Initial Coin Offering round in 2017

Quoine provides trading, exchange, and next-generation financial services powered by blockchain technology. The platform allows users to trade virtual currencies for legal tender and in 2017 they launched their own ICO, QASH. After three days the company announced it had raised 350 million QASH with an oversubscribed placing, making it one of the most successful blockchain fintech ICOs globally.

Hatcher+

What: Data-driven venture investment platform

Funding: US$3.5M during the early stage funding round

Hatcher+ is a next-generation, data-driven venture firm that uses AI and machine learning-based technologies to identify early-stage opportunities in partnership with leading accelerators and investors, worldwide.

Hatcher+ provides optimised returns for venture investors using proprietary algorithms, real time monitoring and customisable technology. It sources startup information from accelarator programs and partner VCs, investment professionals and angel investors.

FundedHere

What: Equity and lending-based crowdfunding platform

Funding: US$1.29M in 1 round from 7 investors

Another startup that was launched in 2015, FundedHere is Singapore’s first home-grown crowdfunding platform. The company offers both equity and lending-based forms of crowdfunding for Asian businesses that meet the startup’s four-point criteria. Equity funding means investors finance the startups in exchange for equity holdings, which will later entitle them to future capital gains and dividends. With lending-based crowdfunding, investors lend a startup money in exchange for a legally binding commitment that the loan will be repaid on pre-determined time dates and interest rate.

PolicyPal

What: Digital insurance manager

Funding: US$20M in funding over 3 rounds. The latest funding came from an Initial Coin Offering round in 2018.

PolicyPal is a mobile application that allows users to find and manage their insurance policies via a single, unified platform. The app shows you where policies have overlapping or missing coverage and recommends the insurance that is best suited to your needs. Their PAL token was launched earlier this year and the PolicyPal Network aims to address key issues that overlap the fields of both insurance and crypto assets.

Silent Eight

What: Artificial Intelligence (AI) system that helps banks and financial institutions combating money laundering and terrorism financing

Funding: Undisclosed

Silent Eight is a regulatory technology (regtech) startup backed by leading venture capitalists from Singapore and Silicon Valley. Using an AI, they pioneer an innovative solution for customer screening and transaction monitoring powered by machine learning (ML) and natural language processing (NLP) which enable banks and financial institutions to fight money laundering and terrorism financing.

Smartkarma

What: Investment research network for asset managers

Funding: US$21M in 3 rounds of funding

Smartkarma owns and operates a research network, providing investment insights into global markets. Acting as an unbiased information source, it originally sought to provide transparent research into markets throughout Asia. However, the company has now expanded into American and European markets, helping investors across the globe to determine their future investments. The research is provided by a number of leading academics, analysts, data scientists and industry experts.

InstaReM

What: Remittance services for individuals and businesses

Funding: US$18.5M across seed, series a and series b funding rounds

Co-founded by Prajit Nanu and Michael Bermingham in 2014, InstaReM(portmanteau of "Instant" and "Remittance") provides fast, secure and cost-effective digital cross-border money transfer services to individuals and businesses.

The startup also offers a configurable, multi-featured platform, MassPay, that helps corporate and SME users to manage and control their high-volume remittances to multiple beneficiaries in multiple currencies via a seamless process, allowing them to reduce cross-border money transfer costs by up to 80%.