MSIN7007

Mastering Entrepreneurship: Coursework 1

Adri Shakir

Assessing Opportunity
Introduction
Teamly is a software-as-service company founded by Scott Allison, an
established entrepreneur whose first venture was an online mobile retailer. He
got the idea for Teamly from a conversation with the CEO of Walmart, who
divulged that he kept a file for each employee who reported to him. Inspired by
other web-based startups, Allison co-founded Teamly with a tech developer,
with the core purpose of creating great businesses with remarkable cultures
which make a lasting, positive impact on the World.
This work is a critical evaluation of the attractiveness of Teamly as a business
opportunity. Though there are many definitions that can be found, a business
opportunity can be described as a solution to a problem, which can be
commodified and sold to generate profits. This paper will be looking at the
future prospects of Teamly in terms of growth potential, profitability and lasting
ability.

The Product
Teamly is essentially a business management tool enabling employees and
managers to prioritise, manage and review tasks. This allows managers to keep
track of their employees without painstaking performance appraisals and
micromanaging. In a nod to Google, one of the leading features of this product is
its simplicity and ease of use. Its user interface is uncluttered while the
maximum of 5 tasks per day keeps the to-do-list from looking too depressing.
Although it lacks many features offered by other products, it is not meant to be
an all-encompassing management system but a tool for coordinating and
prioritising tasks within an organization. This may be complemented with other
tools for file sharing, project management and administrative work.
The beta version was introduced in mid 2010, garnering 6000 users by the time
they launched officially mid this year. It is based on the freemium model, which

MSIN7007 Mastering Entrepreneurship: Coursework 1

Adri Shakir
offers a free package supported on advertising and a premium package, which
offers better services.

Business Plan
As mentioned earlier, the business is based on the tried and tested freemium
model. Non-paying users, which are usually the vast majority, get all the essential
features. For $8 per month, they get better security, data export features and
additional support. Although only less than 5% of users are expected to pay [2], it
is made feasible by the relatively low cost involved in developing a product i.e. it
costs the same for one user or a million users. Additionally, it promotes word of
mouth marketing through the volume of users that cannot be achieved
otherwise.
In the next phase, which is due to start once further financing is secured, is to
further develop the product and to start targeting the larger businesses. One
advantage of doing this is that they have time to sort out any issues while the
customer base is small and they can provide more attention each client. It also
allows some time to establish themselves in the market. Aside from incremental
improvements, they are developing Teamly for use on mobile devices. This
market is growing very rapidly, at least 10% a year [5].

Target Market
At this stage, the product is targeted at small to medium enterprises with less
than 500 employees, which hire a total of around 60000 employees in the US
alone

[1].

Currently, their biggest customer is a company with about 60

employees. Smaller markets are easier to penetrate because they tend to be

more accepting to new systems as opposed to larger ones. This may also be
because smaller companies also tend to be more innovative and accepting to
new systems.
In their market research they found that 52% of respondents said they were
interested in their product. Furthermore, 27% businesses already use some form
of performance management software, which means there is a large untapped
market.

MSIN7007 Mastering Entrepreneurship: Coursework 1

Adri Shakir

Sales and Marketing Strategy

Emulating services such as Yammer, Teamly employs a bottom up marketing
approach, similar to viral marketing. Instead of selling the product to employers
who then instruct employees to use the software, they rely on the employees
themselves to market their product. They have users from a broad range of
companies of all sizes and the idea is that once employers realize its usefulness,
they will buy it for the whole company. This fits with the target market, as there
is more direct communication between management and staff. This results in
massive savings from not having to hire a sales team.
Though effective, a viral marketing is hard to successfully implement. It is
important to understand that things go viral from grassroots level, through the
blogs, forums and social media. Since its launch, Teamly heavily promoted their
product within these media, getting their product reviewed in blogs, maintaining
an active Twitter presence and getting stories in publications. Allison did all this
alone from home.

Timing
Timing is a crucial success factor of any business opportunity and being ahead of
your time can be just as bad as entering a market too late. These days, there has
been a large increase in management and productivity software available such as
Evernote and Dropbox, which shows that the demand is there. Market growth in
this category of software is up to 20% a year, which is phenomenal considering
the poor economic climate. It is also worth considering that while a lot new
software is emerging, there is also frequent displacement by newer products.
The recent world recession was actually very good for Teamly. A lot of
companies were forced to downsize, getting rid of unnecessary administrative
staff and managers are ultimately left with more on their plates. This creates a
stronger demand for cheap and effective business solutions. Also, post-recession
conditions enable a lot of smaller companies to grow, which increases the size of
our target market.

MSIN7007 Mastering Entrepreneurship: Coursework 1

Adri Shakir
At the time of writing, Scott Allison has just moved his business to Silicon Valley
from London, which is a perfect environment for this venture. Obviously, there
will be greater accessibility to technology experts who will be essential in their
next stage of development and growth. Aside from that, Silicon Valley is a
thriving with young tech companies, which tend to be smaller. This is exactly the
market we are trying to tap and having geographical proximity would be an
added advantage.

Competitors
There is a range of freemium software available but mostly for project
management, which is not very suited for our target market. Most of the paid
business management solutions out there, such as Oracle, SuccessFactors and
SAP tend to be quite comprehensive and costly, as they are aimed at larger
organisations of more than 500 employees. While these products are not
currently in direct competition with Teamly, they may pose a threat in the
expansion phase.
37 Signals, which brought us the popular project management software,
Basecamp, is a major competitor. Their other products features include contact
management, file sharing and management and communications, aimed at small
businesses and enterprises. Prices are very competitive, offering their whole
suite of products for only $99 per month. [3]
Another major competitor would be Huddle, a stripped down business solutions
software aimed at smaller enterprises. With prices $20 to $100 per month, its
features include file sharing and management, collaborative editing and project
management. The only edge that Teamly has over these competitors is that it is
well differentiated, offering a much simpler and focused product, centred on the
individual and their priorities, rather than processes and projects. [4]

Financing
So far, Teamly has been self-financed, which may provide some insight into the
capabilities of the founder and his product. The fact that he did not get early
financing, when he easily could have considering his reputation, shows how

MSIN7007 Mastering Entrepreneurship: Coursework 1

Adri Shakir
much faith he has in this product. However, as he is taking on all the risks, his
optimism should be taken with a pinch of salt.
Being self-financed means there is no pressure to bring in dividends, which may
be a positive thing if they are swallowing cost to secure market share or improve
their product. It could also have a negative impact in that there is no external
criticism and Allisons judgement may be swayed by the sunk costs already
incurred.
While he expects the company to break even in about one and a half years, it
should be noted that he does not reveal exact details on the cashflow. This is
understandable considering the amount of secrecy needed for this kind of
business but it prevents us from making a quantitative analysis of the business.

Team
CEO Scott Allison, who is the sole director of the company, currently heads
Teamly. His vast experience as an entrepreneur and CEO, and his involvement in
the technology and entrepreneurial circles provides added credibility and a
strong network. This will be an advantage in securing financing, public relations
and hiring. Aside from that, Allisons work involves the same type of people and
organisations that Teamly is targeting. This means he understands the customer
and their needs.
Initially, Allison ran the business with his co-founder, a technical expert who
developed the software while Allison dealt with the business side of things. This
guy eventually left to work on another project, leaving Allison to run Teamly
alone. He managed to get people to work on the technical side on a contract basis
but still leaves him in a vulnerable position, as there were no equity holders who
know anything about programming.
However, Allison is not all alone. He is aided by a number of advisors who are
mostly entrepreneurs and directors with experience in web based services.
While their expertise will undoubtedly come in handy, advisors do not have a
stake and are not involved in day to day operations which means they are less
likely to identify and solve any underlying issues that they may have. Also, each

MSIN7007 Mastering Entrepreneurship: Coursework 1

Adri Shakir
successful web business is unique and there are no hard and fast solutions to any
problems.

Conclusion
At the UCL presentation, Allison mentioned that they were in the midst of
securing investors for further expansion. Assuming they manage this, the main
challenges faced by Teamly is securing market share for its competitors. This
could be achieved by the right people on board and reviewing their prices. Aside
from that I believe that they have a good product and their prospects look bright,
especially with their recent move to the Silicon Valley.

References
1. Statistics about Business Size (including Small Business)
from the U.S. Census Bureau 2011 [online]. [Accessed: 17/11/11].
Available from World Wide Web <http://www.census.gov/econ/
smallbus.html>
2. Freemium Blog 2011 [online]. [Accessed 17/11/11]. Available:
<http://www.freemium.org/>
3. 37Signals. 2011 [online]. [Accessed: 17/11/11]. Available from World
Wide Web <http://37signals.com/>
4. Huddle. 2011 [online]. [Accessed: 17/11/11]. Available from World Wide
Web <http://www.huddle.com/>
5. DREDGE, S. 2011. Smartphone and tablet stats: what's really going on in
the mobile market? [online]. [Accessed 17/11/11]. Available from World
Wide Web:
http://www.guardian.co.uk/technology/appsblog/2011/aug/01/smartp
hone-stats-2011
6. Entrepreneurship Guest Lectures Autumn 2011 [online]. [Accessed
17/11/11]. Available from World Wide Web:
<http://www.ucl.ac.uk/advances/training/entrepreneurshiplectures/aut
umn2011>
7. Teamly 2011 [online]. [Accessed 17/11/11]. Available from World Wide
Web: <http://www.teamly.com>