IT Freely, Episode 5 : Open Source Software & VoIP, featured a brief snippet of an interview with Patrick Collison (homepage, twitter, Facebook) and has a chat about Tech start-ups in Ireland (based on his Irish Times article) and iPhone App School (homepage, twitter).. If you want to hear more, the full interview is available for your auditory delectation here. Check it out.

Transcription was provided by Niall Campbell.

The full interview is available under a Creative Commons Attribution (CC-BY 3.0) license.

DD: Hello, I’m chatting to Patrick Collison who’s back in the country for, what, only a week?

PC: Yeah, a week, heading back to San Francisco on Monday.

DD: Okay, it’s a terrible life.

PC: *laughs*

DD: I suppose you’ve hit the press recently a few times. One of the things was an article that you publishing the Irish Times in respect to Startups in Ireland. One of the things that it highlighted, one of the things that stood out to me, was that the government should take fifty million and give it to each of fifty startups. Do you think that’s actually a viable thing that they would actually go ahead and do?

PC: I have no idea is the honest answer. I mean it’s worth pointing out in this idea that it’s not actually mine originally. Having said that, I certainly think if done, it would work, it would almost have to work. It seems there isn’t too much doubt that if you offered it, startups would take it, and you know once fifty or whatever number of startups did take up the offer you really would be one of the bigger startup hubs in the world. As to whether the government would do it? I certainly think they should. Ultimately in the context of the governments finances, despite the recession it’s not a huge amount of money, especially compared to the benefit it would bring, I mean you only need one of these companies to do fairly well for them to make their money back. There was a report that came out yesterday that was suggesting €5.7bn in cuts I want to say. And €50m out of that is only a percent.

DD: Yeah yeah, of course, but people are always going to shout and say venture capitalists are risky and can we really trust out tax-payers money to risky startups?

PC: I think we have to, and I think a big part of the problem with investment as it’s done in Ireland today is that it’s NOT trusted to risky ventures and I’ve heard [investors] say one of the things they’re most afraid of is investing in companies that fail. That’s just a really bad mindset, I mean as an investor if you don’t invest in risky companies you’re going to miss out on the really successful ones. It’s important to remember that both Facebook and Google could not raise venture capital the first time they tried to raise it. I mean, they were seen as so risky they could only get danger money. And so, if our own state bodies are having a lower threshold than [Venture Capital companies], they’re almost guaranteed to miss out on the good companies.

DD: Both Facebook and Google started in Universities and a lot can be said for the academic sheltering that they had in their first early days. Google have the stories where they’re working the IT department, robbing a PC once a week saying “Yeah, yeah we’ll image that for you.” and using that as the initial Google search engine. Might it be a better route to approach to say we’ll put money into creating spin-off companies in Universities, take the talent from the University and create a spin-off from it. Would that be another route to take?

PC: I certainly think it’s a decent idea, I mean obviously an awful lot of successful technology companies have come from the Universities in the States. In Facebook’s case I think it was arguably incidental, certainly I don’t think the academic community in the university had much of a role to play, perhaps the social cache of those it was exposed to. I don’t know, I don’t have a particularly strong opinion on Universities to be honest. Like I said, there have been many succesful ones, I don’t know what Universities can do to encourage it. I don’t know of anywhere that has made some kind of explicit decision to change things, which makes sense.

DD: So, along those lines, what else do you think would be needed to create a really sustainable startup culture within the country?

PC: I guess at a broad level the most important thing we have to do is firsty recognise that the goal of having startups here is a valuable one and really focusing on it, and once people accept it as important and once we can agree on the sort of startups to encourage I think a lot will automatically follow from that. I think another thing that is easy to miss, is we tend to focus on the Irish aspect of it and we tend to focus on Irish startups and Irish entrepreneurs, and all the rest, which I think is entirely the wrong approach. I’m all for encouraging Irish people and Irish startups, but if we solely focus our attention on that aspect of it, we’re not going to do too well. It’s important to bear in mind that very, very few of the founders, in fact almost none of the founders of the successful Silicon Valley technology companies actually came from Silicon Valley. If you think of Silicon Valley is around the same population size of Ireland, and if Silicon Valley had only encouraged people native to the Valley to be successful, we’d never have heard of it. All of the successes came from people who moved to the Valley. I think Ireland needs to concentrate on becoming the kind of place that people from France or Germany, India or China or wherever want to come to set up their companies. Of course, Silicon Valley hold a very dominant position here and it’s not going to be easy for anyone to compete, but we need to recognize we’ll have to succeed their to have any success to building anything comparable to the Valley.

DD: Okay, I mean we’ve already done this with the Shannon Free Zone. I mean, the Shannon Free Zone attracted the likes of Intel, the likes of Analog Devices to start their European arms of their tech companies in the country, and the main thing was non-taxes. Do you think non-monetary incentives might be another way. For example, if we take an incubator type thing, have you been keeping tabs on Evert Bopp’s GreenHouse Incubator?

PC: I have, yeah. Personally I’m not a huge believer in incubators. Lots of people have tried, not many have succeeded.

DD: I think the angle I’m trying to take is, except money, what else can we do to attract people?

PC: I think a really important one, and I mentioned this in the article, is immigration law. It’s hard to overstate just how much harm US immigration laws are doing to the country right now. I know countless people who’ve had to leave the country due to being unable to get a visa and have become sucessfully employed elsewhere or started their own companies employing tens or hundreds of people. I guess a local example is Liam Casey who couldn’t obtain a visa into the US and moved to China and now employs eighteen hundred people out there. It’s almost crazy how much the US is shooting itself in the foot here and Ireland to absolutely capitalise on this and not just give a visa, but give a passport to anyone to people who look like they might set up things here.

DD: Does that go for tech companies or does that go across the board? I mean the first criticism you’re going to get is that suddenly the wave of Nigerians we had back in 2000/2001 are going to turn up on our doorstep again if we start offering free visas and free passports.

PC: I think people worry a bit too much about that.

DD: Haha, the health board would say otherwise, with them paying the rent and all.

PC: Of course there are, quote, “risks” here, and I’m not advocating blinding giving out passports or visas or anything like that. But, to give a counter-example here, Ireland used to have a reasonably good name in, I don’t know how you want to define it, the English language 3rd Level education sector, say Britian, the US, Australia, New Zealand etc. Back a couple of years ago we had a 1% market share globally of non-English speaking students coming to English-speaking universities, students from India, China and all the rest, and this figure is actually declining. A big reason for that is the perceived and real difficulty for a student wanting to obtain an Irish visa, and actually the approval rate is something like 60% as compared to something like 94% or 95% in the UK. This is just crazy, these students are profitable for us, they’re generally hard working people, because of the selection bias these are people who want to go abroad, are willing to live abroad, learn another language, study another language, etc. These are almost guaranteed to be good people and yet Ireland is turning them away in large numbers and most importantly creating this perception of Ireland not being a country welcoming to these hard-working, industrious people.

DD: Saint and Scholars and all that, yeah.

PC: Right now we’re committing the same mistakes the US is making, except the US, because of their dominant position, can afford to make them, we can’t.

DD: Okay. I mean it’s something we could really capitalise on here. I suppose one or two bullet points to slap in front of a minister would be really useful. Like you said, fifty million, one to each startup would be one. I think I can imagine a large amount of criticism that’s going to be levelled will be along the lines of administrative and you know, is it worth the amount of effort we put in. If we’re essentially employing 20, 30, 40 civil servants to keep tabs on this hub of innovation, are we going to see enough returns to pay those salaries, in order to actually sustain the effort that goes into it. You can’t say yes or no, it’s very, very likely but it’s probably going to require probably one or two bright sparks like yourself to hand-pick and say “Look, these companies are great, these guys have got real good vision, motivation and direction.” and go with that.

PC: It’s important to remember that even if the initial 50 companies did not produce profit for the government, that doesn’t mean the programme would be a failure. The point of doing this is only partially to bring these particular companies to Ireland, the real point is to turn Ireland into the kind of place where other people would like to come. The real value for Ireland would not be in the first fifty companies we bring, the value would be in the other thousand companies that come because there is this cluster of fifty companies in Ireland.

DD: You’ve lived in San Francisco, and I’m sure there’s an awful lot of auxiliary, social, nerdy type things which we don’t have here. I’ve visited briefly, but I noticed stuff like, on the most simple level, an Apple Store, we don’t have one here, but there they’re all over the place.

PC: *laughs* Compu-B might beg to differ, but I know what you’re saying.

DD: Are there other things like that? I mean, you’ve got a variety of sctreaming alternative music stations in San Francisco, you’ve got a variety of lifestyle things to back up a tech startup culture. What along those lines could be developed and built on here if we want to draw young startup types here and say “We’re [as good socially] as Silicon Valley.”.

PC: It’s a good question for sure, and the honest answer is I don’t know, but it’s certainly important. I guess what I wonder is whether it’s necessary in the beginning or will it just naturally follow if we do all the other things right, and I think it might be the latter. Silicon Valley, when it started out, wasn’t any hive of youthful creative activity, it was a fairly sleepy little place. It’s easier for Silicon Valley to grow organically, something else is going to have to grow a bit and Silicon Valley has all these advantages already. The one thing I would say, is I think it’s really important in attracting people to have really good universities. I don’t have too much to say on the whole fees debate except that there’s very little evidence that you can have both world class universities and free education. We should at least be realistic that the choice is between one or the other. Maybe we decide that we don’t want world-class universities, that we’d rather have free education than the best colleges in the world, and maybe that’s where we want to be but we should at least be honest with ourselves that this is the choice we’re making.

DD: Yeah. Agreed, that’s a good point to make and one that I’ve never really fully considered myself but it’s a good one to make. Moving away from that a bit, I’m sure we’re going to have long discussions about it in the future, one of the things you’ve been involved in recently has been the iPhone App School. How’s that going, when’s that starting?

PC: That’s starting on Monday in the Castleknock Hotel in Dublin.

DD: Brilliant.

PC: It’s an outgrowth of work I was doing in iPhone applications myself and just generally seeing how well it can work out, not for big companies, but for a guy who can afford to spend a few hours a day spending on something. Especially in the current economic situation in Ireland, something that people might really appreciate.

DD: I’m going to have to challenge you on this one. You’ve just thrown in the words “Individual” and “Current economic situation”, and yet you’re charged €1500 a pop for the course. It doesn’t compute with me. Personally I’m interested in developing for the iPhone, but I don’t have a Mac, I’m going to have to shell out a grand for a Mac.

PC: App School provides rental for €100.

DD: If I wanted to develop myself on this in the future, realistically if I going to want to continue developing for this if I’m going to get use out of my investment, I’m going to have to shell out for a Mac.

PC: And an iPhone or an iPod touch.

DD: And an iPhone which I don’t have. So it’s a total investment of about three grand. Where’s your average developer going to come up with that cash?

PC: I agree it’s a problem that people have to spend money and it’d be much nicer if they didn’t have to. Ultimately it still costs us to run App School and we can’t provide it for much less. What I will say it’s that it’s still an awful lot cheaper that almost any other secondary income stream that you might want to create, you know if you might want to set up some sort of website where you take subscription payments or whatever it is, you’re going to have to pay for servers and probably a designer and merchant bank accounts and blah, blah, blah.

DD: I agree to all this, the area I disagree on would be, would it not make more sense to target this at corporations and say, look, you guys can put down the three grand investment and now easily develop an in-house application for your payrolling, you can develop an in-house application for getting out news updates to your sales team, every time there’s a sales update, push that out.

PC: You know, you might be right, but we’re not approaching App School as a way for ourselves to make money, or certainly much, it’d be nice of it made some. It’s more to help people like us. I would have loved to go on this course back when I started doing iPhone Application development, and really this came out of “How can we get people like Daniel and myself up to speed quickly with iPhone applications?” It may not be the theoretically optimal solution to how to do iPhone training in Ireland, and maybe someone, or maybe even us will decide to focus on that a little more.

DD: Okay, on that, if you’re planning courses in future are you limiting yourself to iPhone or are you planning to go towards Android, Symbian, Blackberry?

PC: Again, we’re kind of playing it by ear at this stage, the first course still hasn’t run and we’re interested in seeing how the reception ends up being, and we have a second one planned in Limerick in about two and a half weeks time now and we’ll see how those go and after that we’ll make some decisions in regard to what’ll happen in the future.

DD: Brilliant. One final thing on that, is there has been some controversy recently in regard to lack of freedoms of applications on the App Store. For example there was a podcaster App which was taken down because it duplicated functionality, there was a Nine Inch Nails application which was taken down because it distributed songs for free.

PC: It was announced yesterday that any application which embeds a browser or provides unfiltered access to user-generated content will have to receive an 17+ rating on the store and you will not be able to distribute promotional codes for it.

DD: Right, I mean what would you say to people planning to go on this store if they have an idea and it falls into one of these categories?

PC: There’s not a whole lot I can say I guess. I think it’s utterly stupid. You keep thinking there couldn’t be yet another ‘what the fuck’ moment and then another one comes along. I guess the only consolation, maybe, is that I don’t know of many applications where the developer went and built something and they were not eventually able to get it into the store. In all the famous cases that attracted publicity that I know of, the applications did eventually end up in the store, perhaps with some modifications or a different rating or whatever. So even though it’s stupid I don’t think that the problem is actually that significant. It’s more morally repugnant than actually commercially harmful.

DD: Sure sure. It sounds like a fantastic idea. It’s yourself, Daniel and Damien Mulley behind it, yeah?

PC: That’s right, and SQT Training is kind of our training back-end.

DD: Brilliant, brilliant. Best of luck, and I’m very much looking forward to the both of them, and I’m sure there’ll be nifty stuff coming out of there. Thank you very much and we’ll chat to your again at some point in the future!

PC: Thank you.