Most tech entrepreneurs might dream of ending up with their companies listing on the Nasdaq, but Brad Keywell isn't sure it's always the right call to make.
Having co-founded seven highly successful technology companies over a near-30 year career, many of which have gone public, he’s in a position to know.
The recently crowned EY World Entrepreneur of the Year winner had some sage advice for the founders of the fast-growing Cork software company Teamwork when he met them at the finals of those awards in Monaco earlier this month.
"I told the Teamwork guys not to go for it," he said, speaking of Peter Coppinger and Daniel Mackey, who were also finalists at this year's event.
“Doing an initial public offering (IPO) has become a bit of a cliche in the tech world. It can be fun but it doesn’t always lead to the best result,” the veteran said.
“We’ve taken companies public before so we understand how it works,”said Keywell. “While public markets are a means to capital and liquidity, there are many other ways to get that.”
Among the companies established by Keywell and his longtime business partner Eric Lefkofsky is the well-known daily deals website Groupon, which during its heyday had more than 60 million subscribers and was at one stage believed to be the fastest growing e-commerce company ever, and easily the most mimicked.
Other companies founded by the two tech entrepreneurs include Tempus, a company that is seeking to build the world's largest library of molecular and clinical data, and Uptake Technologies, for which Keywell received this year's big award.
Keywell admits the allure of a flotation is difficult to fight, even for a company such as Teamwork, which has bootstrapped its way to success. But fight it they must, he said.
“I told the Teamwork guys that they and anyone else considering a listing should check their egos. I don’t necessarily mean that in a negative way but just that you need to figure out if you are going down that route just because it speaks to that,” said Keywell.
“Life is about making decisions around risk and reward and if the reward for someone is a healthy ego, then that’s fine, but it isn’t always the best way forward for the business,” he added.
As might be expected, Keywell isn’t in a rush to take his latest company public.
Uptake, a Chicago-based predictive analytics software company he founded and leads, was established in 2014.
“It’s Moneyball for industry,” is how Bradwell describes the start-up.
Uptake makes software that monitors and analyses industrial equipment to improve the performance and maintenance of the machinery. The company works with organisations across multiple industries to help them determine when a piece of equipment is not performing well or is about to break down. It analyses data from sensors on equipment and then uses data-science models to predict problems before they occur.
Customers include the US army, the American Red Cross, Caterpillar and Rolls-Royce.
“We have the ability to inform industrial companies around the world what to do to be their absolute best and we achieve results that human beings simply cannot get by themselves because it isn’t easy to access that data without the use of sensors,” said Keywell.
“We make blind spots visible. We do this by knowing what will happen next week and showing companies how to avert it,” he added.
Uptake has grown to 500 people since 2014 and, just three years after its founding, was ranked the fastest start-up globally to have reached a $2 billion (€1.76 billion) post-money valuation.
Mr Keywell said he got the idea for the company when he went to pick up his daughter from an airport, only to find her flight had been delayed because the airline didn’t have the right part to hand.
“Uptake is very simple in what it does and very complicated in how it does it,” the entrepreneur said.
“The simplicity is that we create outcomes that make global industry more reliable, productive and safe. However, how we do that is by taking data from sensors, machines and a multitude of other sources. We then use data science, machine learning and artificial intelligence to make everything work better.”
Keywell said part of what made him want to set up the company was realising that the cost of sensors and of the cloud was falling.
“Sensors, like computer chips, have gone down in price and up in quality and it is the same with the cloud. You put them together and all of a sudden industries around the world can learn more about their operations,” he said.
The entrepreneur added that while it initially seemed an audacious idea to create a platform that could work across multiple industries, and which would only improve over time, the plan has worked.
“If we can solve problems and create better outcomes in one industry, then we can do it across a variety of them because the insights you gain in one area can be applied elsewhere,” he said.
Keywell admits that Uptake doesn’t have the field to itself, but he doesn’t seem overly concerned by his rivals.
“We’ve competition out there including from legacy enterprise software companies, but they are crippled by the choices they made years ago that prevent from being able to take advantage of data. Such software was built to accommodate data entry, such as entering invoices and so on, whereas predictive analytics is about everything but human data entry,” he said.
“While legacy software companies want to compete in this space they do so through modelling, rather than through results,” Keywell added.
The tech veteran has backed many winners but believes his latest venture may be the best yet.
“Uptake is the most special company I’ve started, not because it is better than others, but because it has been built on 27 years of experience so we founded it the right way. We are respectful stewards of our investors’ money, have built an independent board and executive with integrity. The trust that our customers put in us is hard earned and is based on all of our many years building businesses,” he said.
Keywell paid his first visit to Dublin last year for a holiday. He says Uptake isn't looking at expanding further in Europe as of now, but that he would be keen to set up operations in the Republic when they get to that point.
“I was really impressed by what I saw on my visit and whoever is organising the country-led effort around articulating Ireland’s valuable proposition as a homebase for tech companies in Europe is doing a remarkable job,” he said.
World Entrepreneur award
Speaking after winning the World Entrepreneur award a few weeks ago, the businessmen told attendees at the finals of the importance of having entrepreneurs in the world.
“Entrepreneurs are not entrepreneurs because it is something that they decide they want to do. It is because it is what they must do,” he said.
“Entrepreneurs tend to carry humanity forward in little baby steps, and once in a while, big leaps,” Keywell added
Ask the tech veteran what keeps him starting businesses and he’s just as effusive.
“It’s all about having ideas that I can’t kill,” he said. “There’s no formula for how long to stay or not stay and the only reason why you start a company is that you have too. I’m not a big believer in starting a company just because you feel like it. You shouldn’t do it unless you can make the case that it has to exist,” Keywell said.
“The reason why in the past we have stepped aside and put other management teams in place in start-ups we’ve founded has been in reaction to the opportunity, capacity and resources that have been there. Right now, Uptake is in a place where I’m the one built to run it,” he added.