Entrepreneurship@BU Newsletter: January 2012
View From The Trenches
BU Team Helps Bring GPS Indoors
BU Competition Semifinalist, Aaron Ganick ECE ’10
Written by James Newton, GSM’12
The sixth floor of One Cambridge Center is the epicenter of Boston-based tech start-ups, housing over 50 infant companies that have been sponsored by either the Boston-affiliate of Tech Stars or DogPatch Labs, a program set up by Polaris Ventures. The space provides rent-free access to a desk, conference rooms, and even Ping-Pong and Foosball tables. However, one of the most invaluable benefits of launching a company within the confines of such a start-up incubator is clearly the exposure to the energy and drive of other entrepreneurs on the floor.
“Without a doubt, moving into this space and working alongside other companies has had an incredible impact on our progress,” says Aaron Ganick, ECE ’10. “Just meeting lots of other creative and hungry people trying to create new value has helped us as we’ve been getting our company off the ground.”
The venture Aaron and his co-founder, fellow BU grad Dan Ryan, have started is called ByteLight—a company that uses LED lightning technology to send information from light bulbs. Developed under the tagline “bringing GPS indoors,” ByteLight can provide more detailed and accurate global positioning in complex indoor environments such as airports, shopping malls or supermarkets. The product is currently under development and expected to be launched soon, but for Aaron and Dan, the process to get to where they are now did not come easy.
The two first began working on what would eventually become ByteLight during their years at BU. “We developed the underlying technology as undergrads. We were able to turn LED lights into high-speed data and access points. It was a good technology, but we both graduated and went our separate ways.”
Aaron went on to pursue his Master’s in electrical engineering at BU while Dan worked as a software engineer in New York City. It did not take long before two opportunities emerged that made Aaron and Dan begin to reconsider pursuing ByteLight full-time. LED lighting prices began to drop considerably and the technology was fast becoming a predominant light source. Meanwhile, mobile devices and smartphones continued to proliferate the market as location-based services such as FourSquare and Living Social became in high demand.
“We saw that with mobile applications and services that used GPS technology, there were no good alternative resources or solutions for use indoors,” recalls Aaron. “And this is what we set out to do with light.”
Shortly thereafter, Aaron dropped out of his Master’s program while Dan quit his job, and the two fully immersed themselves into ByteLight’s development. Part of this process involved participating in business competitions around Boston. ByteLight was a semifinalist in BU’s 2011 $50K New Venture Competition, which proved to be a seminal moment for the team.
“ITEC was definitely a starting gate for us. At that point, it was just a cool technology without a business plan,” adds Aaron. “We took the lessons from that experience and then entered Mass Challenge. We were semifinalists in that Competition as well, but the real important takeaway was the ability to make a lot of great industry connections.”
The big windfall for Aaron and Dan occurred in May of 2011 when ByteLight was accepted as part of the Summer@Highland start-up program sponsored by Highland Capital Partners. The program awarded ByteLight with a healthy, no-strings-attached, stipend, and office space alongside three other start-ups in Highland’s new Cambridge offices. The ability to put their heads down and focus on the product proved to be invaluable for the team.
“The summer at Highland was a big shift for us. We came out of it knowing more about the industry and our company. It helped us tailor our message and fine-tune our business model.”
As the ByteLight team prepares for the product’s launch, the years-long process has educated Aaron on the rigors of starting a business from the ground up. One of his biggest lessons learned from the experience and advice for aspiring entrepreneurs is to take a step back. “You need to find a market for technology where you can really add value. Just because it is a cool idea or technology, does not necessarily mean it is going to make it. You need to apply it towards a critical problem, and design towards an unmet solution that people are seeking.”
Aaron credits the professional guidance provided both by the Summer@Highland and networking amongst industry executives as being influential in guiding the direction of the company over the past year. In particular is the Boston chapter of the Startup Leadership Program—a nationwide training program for future CEOs that links industry professionals with start-up innovators. It is here where Aaron has met one of his mentors, Boston University Adjunct Professor Babak Kia.
To learn more about ByteLight, visit www.bytelight.net.
Seven Fundamentals Every Entrepreneur Must Consider
When Starting A Business
Ahmass Fakahany, SMG ‘79
On any given night at Manhattan’s Marea or Ai Fiori restaurants, you might see the likes of Lady Gaga, Madonna, Ben Stiller or even Roger Federer. Such celebrity patrons are business as usual for the high-end eateries founded by BU School of Management alum, Ahmass Fakahany. A veteran of the finance industry, Fakahany entered the restaurant business after 20 years with Merrill Lynch where he last served as Co-President and COO. He is the founder of the Altamarea Group with Chef Michael White, and the group currently owns six restaurants with more to come.
During a recent visit to the School of Management, Fakahany spoke to a room full of aspiring entrepreneurs about their own passions and offered business insights he has learned over the years. He focused on seven fundamentals every entrepreneur should consider when starting a business. We share these with you below:
- Have a Clear Vision Beyond Year #1: “It is very destructive to realize that, midway through the process of starting a business, you have outgrown your first trajectory and now you have to stop, go back and realign everything,” Fakahany advised. He stressed that in the early stages of developing a new business, it is critical to concentrate on building the proper foundation and vision so as to not waste time, money and resources at a later stage. For instance, to ensure efficiency and commitment to his own vision, Fakahany created what he calls the “Super Back”—a term that refers to his back of the house staff made up of top consultancy and finance talent. In assembling this business team, he could focus on getting the best possible deals on real estate and financing for the long-term and give his business an edge over the competition.
- Deploy Business Metrics: The standard practice at Merrill Lynch is to provide analytics to support key business decisions. Fakahany leveraged his finance expertise to enhance business operations at his restaurants by implementing digital analytics. This concept is based off what is commonly seen in Las Vegas. “When you go to a hotel in Las Vegas, they do everything needed to keep you in that hotel. They know who you are, what drinks you have had, what games you play, or even what butler you like. It’s all about client retention.” He stresses the use of technology and “mining client data” as a focus with aspiring entrepreneurs. Just like the low-margin restaurant industry, all new businesses need to closely monitor finances and measure its progress daily and find ways to innovate in order to enhance operations and save costs on the back-end.
- Safeguard Equity: With regards to new business financing, Fakahany was not bashful in expressing his feelings towards giving up equity. “Unless you absolutely have to, I would strongly advise against it.” He warned that giving equity enables feelings of entitlement and slows down decision making and if a new business were to hit it big someday, it is now on the hook for a heavy dose of dilution. Instead of equity financing, Fakahany recommend going to banks. “Regional banks… not one of the major banks even though it could be more challenging.” he commented. In approaching banks for financing, it is critical to be prepared, organized and confident – - and very convincing. “At the end of the day, they are lending to the individual. They will never know enough about your business, but they at least need to be secure about it and see the potential you see.”
- Breed a Culture of Accountability: In small businesses, employees learn by example, and it all starts at the top. Such is how Fakahany operates within his restaurants. When he is going to be late to the office, he consciously alerts all of the staff, and he unabashedly takes on menial tasks such as taking out the garbage. This breeds a culture of partnership and the focus on performance and results breeds a culture of accountability. With every business deal he makes, Fakahany always considers how it will benefit his employees. In proposing barter agreements or negotiating deals with other businesses, his primary motive is always to get something that can reward his employees. “I try to incorporate an HR dynamic to create purpose and motivation, so that when I go out to make a deal, my employees know that I have their best interests in mind.”
- Manage Your Own Brand: When a business is in its infancy, marketing and public relations are undeniably critical. During the early years of Fakahany’s restaurants, he was approached by a number of advertising firms that did a “fabulous job in telling [him] how they can help [his] businesses.” But ultimately, he and his partners decided to go a different route. “We created our own logos, something that I actually quite enjoyed doing.” Fakahany’s big takeaway from this experience and his advice to students was to “Brand Yourself.” No one knows his or her own business better than the people who founded it, and they should be the ones to shape its message. Also, he said “if you cannot measure the value or impact of advertising on branding services, don’t buy it.”
- Identify and Nurture Your Culture: Fakahany next emphasized the importance of thinking about how you want your business to be perceived. “Culture defines how a company is run and how customers perceive it. It is essential for culture to be identified early on.” Indeed, the atmosphere of his business was derived from his own personal experiences as a frequent client of high-end restaurants while at Merrill Lynch. “We decided to embrace a total “client centric” position. It all starts and ends with the client. We want people to have an amazing time and be themselves, and that’s what we’ve created.”
- Be Paranoid: “Even if things are going well, imagine what can go wrong and imagine it is going to really hurt,” Fakahany told the group. Complacency is a pitfall that could cripple a business and he believes that maintaining a sense of paranoia keeps a business leader motivated and prepared for the worst.
Launching a business is never easy but it can be a rewarding experience. Fakahany believes that “Above all, you have to go in with a state of confidence and believe in yourself or no one else is going to believe in you.”