The proverb “Necessity is the mother of invention” is sometimes ascribed to Plato in his best known work: The Republic. However, those translations from its original Latin weren’t made until much later and are more likely to be the work of the translator than a literal version of Plato’s words.
The earliest actual English usage of the proverb can be found in Richard Franck’s ‘Northern Memoirs, calculated for the meridian of Scotland’. (1658).
Whether it was Plato or Richard Franck who inspired the quote is irrelevant. What does matter is it proved true once again. This time, for tech start-up NovaShare: a company that began life as a data provider of reliable proxy analysis and has quickly evolved into a business analytics software company able to help business better position data.
In conversation with Tyson Rose, founder and Chief Executive Officer of NovaShare.
Explain your company and how it came to be.
Thomas [NovaShare’s Chief Operating Officer] and I both worked at a major proxy advisory firm where we manually created many reports about shareholders and proxy voting. This process was very time consuming and we were often under very tight deadlines, so we started thinking about how we could create our own company and a more efficient approach to analyzing publicly listed companies’ information related to proxy voting and their shareholders. We inquired about hiring programmers but found that this was going to be very expensive. Moreover, the programmers did not have the background that we have with respect to proxy voting and shareholder analysis so we ended up learning and writing the code ourselves. That process took roughly a year and now we are in the process of marketing the applications that we have created.
How have you changed your model along the way?
We have modified and upgraded our applications based on our growing understanding of how to manipulate the underlying data, as well as feedback from over 100 public companies. We recently launched two new web-based platforms for reporting issuers and proxy advisors. NovaShare Corporate and NovaShare Administrator enable businesses to seamlessly access proxy voting and share ownership data from any device, including mobile, and provide real-time reporting and data management applications to corporate secretaries, investor relations professionals, and proxy firms challenged with the task of communicating to a wide range of investors. Both platforms are available as a cloud-based, annual subscription service as of March 2, 2016.
We initially had a relationship with their proxy division, which purchased reports for some of their clients. The proxy division introduced us to their U.S. partnership and sales team. We then established a fit between our technology and their customers’ needs. The next step was negotiating the terms related to how to release and market a white labeled Platform as a Service (PaaS) product. This process required eight months. At the end of this period, we were able to reach a formal agreement.
It is all about the data. Why?
Our proxy and governance data feeds are second to none and offer the most accurate business intelligence on which companies can rely for board and management reporting. In addition to the integrity of the data, it is important to understand how to best manipulate and manage the data. We have spent almost two years researching and developing software so companies can draw on better intelligence and save time during research. We believe our platforms will change the way proxy engagement is managed globally by offering end-to-end data management and business analytics.
What can NovaShare do with this data?
The platform enables our clients to execute comprehensive geographical and demographic studies on where and who their investor is, accessible enterprise wide. This data provides investor relations officers (IROs) and marketing teams with a better understanding of the most effective ways to communicate with shareholders for proxy matters, or general business updates distributed to shareholders. For special situations or proxy contests, this level of analysis is a must and we feel that our platform offers the ease of use to generate effective reporting
What’s most fascinating about data analysis at this level is the depth of historical information which an organization can review about their shareholders. For large companies it can offer a better understanding of where the clusters of investors are for marketing; for smaller firms it’s a perfect aid for targeting geographic locations for future road shows – retail and institutional.
Five Questions with Tyson Rose – CEO of Novashare
1. What was your first export sale?
We negotiated a channel partnership with a stock transfer agency called AST. They provide comprehensive stock transfer and employee plan services to over 2,800 public companies and maintain approximately 6,000 issues. AST’s clients are located throughout the U.S. and in over 22 foreign countries, ranging in size from initial public offerings to Fortune 100 companies. Founded in 1971 and headquartered in New York, AST provides clients with customized solutions to fit their specific needs along with access to systems, services, processes, and products. Channel partners are companies that partner with a producer of services to sell the producer’s services and/or technology. As our channel partner, AST markets NovaShare’s services to their clients. NovaShare receives an annual fee and a specific amount for every client to which AST markets our services.
2. How did that first export opportunity arise?
We initially had a relationship with their proxy division which purchased reports for some of their clients. The proxy division introduced us to their U.S. partnership and sales team. We then established a fit between our technology and their customers’ needs. The next step was negotiating the terms related to how to release and market a white labelled PaaS product. This process required eight months. At the end of this period, we were able to reach a formal agreement.
3. When it comes to exports, what do you know now that you wish you knew then?
We did not have a working knowledge of the different resources available to our business for exporting products and services. Had we known this, our marketing and legal costs would have been much more affordable and our capital spend could have been utilized in other important areas of the business.
4. How has the trading world changed since you started in business?
There seems to be more acceptance to trying out global suppliers now that the competitive landscape has changed in our industry. There are several Canadian companies making a huge mark in the investor communications space, which has opened the eyes of American firms who are now approaching us to support their business in many different ways, which was not the case when NovaShare was founded.
5. What is the #1 thing new SMEs need to know about exporting and trade?
Due diligence on their suppliers and partners is the utmost important thing. Do they have a large enough reach to scale your offering or services? Is the marketing and sales support in place to quickly take your offering to market immediately, or will there be more work and capital expenditures required to make a trade relationship become successful? Can you enter the global market alone, or do you really need to form a trade partnership to maximize a growth opportunity?