This blog by Chimni founder Nigel Walley argues that the Irish and UK tech sector should pioneer a new kind of start-up company structure. Aimed at letting start-ups reach for scale quickly, a joint approach could be rolled out to willing participant markets across Europe.
If you start a tech company in the US, your immediate home market is 120 million households or 320 million people. These customers are all linked by a single language, a single currency and a single media landscape. With a single web site and a single registered company, a US tech start-up has access to a massive domestic ‘launch’ market. This is why, by the time we meet them, US tech start-ups are already huge beasts.
US companies also benefit from having an immediate ‘second market’ next door in Canada, with another 12 million households containing 45 million potential customers speaking the same language and sharing a similar and interconnected media culture. Their access into Canada is facilitated by a raft of inter-government initiatives designed to ease cross-border trade.
UK and European tech start ups often feel like minnows in this context. The dream of the European single market initiative was to create the circumstances that would give European companies access to a market of a similar scale. However, the failure to implement the various Services Directives in European trade agreements means that this is still a pipe dream. Services account for 71 per cent of EU GDP, but only 3.2 per cent of this is from intra-EU trade. For tech start-ups this is a significant problem but we think there is an opportunity for the UK and Irish tech community to cut through this.
The Problem and the Solution
Chimni's launch intention was always to focus on Anglo-Irish residential property sector. We launched initially in the UK but moved rapidly to set up a base in Dublin. To secure the Irish URL and to trade, we had to set up a separate Irish company, with a separate corporate listing and a separate Irish bank account. Our small tech-start up, that has barely started trading, has had to occur the time and fees cost to submit two separate sets of annual accounts to two separate tax authorities. We now have separate registered offices, and required local directors for each company. All this to add another 1.5 million potential households for a start up that is just experimenting with its first launch product.
For Irish property tech start-ups the problem is the same but with more to lose. With free access to the UK, the 25M British homes and 65M consumers can ad 'heft' to the 'weave' of Irish innovation. Meaning they can exploit British consumers as an extended home market, to gain traction before tacking Europe and the coveted US. We should be making this as easy as possible for Irish tech start ups.
The long term aim for Europe is for single companies, to work in single regulatory / financial context. With or without the UK in the EU, this currently feels like a pipe dream. But rather than waiting for the larger European issues to be solved, the Irish and UK government should sponsor a new kind of corporate entity, specifically aimed at the tech start-up market, that can immediately operate across borders in Europe. We are proposing this new entity could be an SME version of the UK's Tech Nation Visa scheme which targets individual talent. This would have a unique trading status to be agreed by inter-government agreement, that allows a single company to operate in multiple territories without needing to re-incorporate, or establish local offices for tax purposes. This structure would only be available at start-up and for companies who are the 's' in SME.
A new company could elect to adopt this format at incorporation, and do this through a new, separate shared web infrastructure, built once but shared by all participating countries. A company operating with this proposed status should be given the unique right to buy all relevant country URLs from a single supplier, without needing any further incorporations or trading presence in each participating country. They should be able to choose a ‘prime territory’ to list in, whose regulatory infrastructure will have pre-eminence on their operations. But their financial reporting and tax payments channeled through a new, separate web infrastructure, built once but shared by all countries. The tax rate applied could be an average all the tax rates applicable in the trading countries, with tax revenues apportioned on a pro-rata basis.
We propose that PAYE for all employees would also be paid into the same, floating structure with employees able to relocate in either territory quickly and easily without re-listing for tax purposes. Management of the concept could be on a devolved competence basis, similar to Interpol, with a central directorate staffed by dedicated employees, but with support from local country experts as required. Participant companies could also be eligible for a Tech Visa scheme to move staff between participating countries.
How To Implement
This is clearly a complex concept to negotiate on a 27 country basis. But tech companies are meant to be arrogantly disruptive. This normally means disrupting markets, but it could also be with regards to ignoring treaties. So we are proposing that we start with a two-country attempt with the UK and Ireland pioneering the relationship – under the auspices of the British and Irish Intergovernmental Conference (BIC), to keep it out of the quagmire of the wider Brexit debate . The UK and Ireland are already close trading partners in a large number of areas, we share a language and an interconnected media market; and we already exchange people and skills between our major cities. Most importantly we have a set of unique inter-governmental relationships like the BIC within which to negotiate and then trial the concept. Currently Brexit seems to be pulling the UK and Ireland further apart. Disruptive tech companies could cut that.
Once we have it operating with two countries, we can roll it out on a country by country basis across Europe, inviting other states, EU or otherwise, to join the process. This could start with Estonia, a fellow European member of the Digital 5 group of countries committed to using digital technology to revolutionise government. Next, adjacent countries with similar history of cross-border co-operation, such as the Scandinavian countries, could be the next triallists invited to join. Countries with similar corporate trading cultures like Holland or Denmark could be the fast followers into the system. The tech industries should fight to keep this arrangement out of any of the other, existing trading blocs or arrangements.
British and Irish tech-ups should be in the vanguard of a new pan-European market of 800 million customers - across all countries of Europe beyond just the EU. The UK and Irish Governments can make this happen by pioneering the concept and set a new generation of huge tech start ups free to trade across Europe. Let Silicon Valley keep its Unicorns, the British & Irish should be building ‘Lions’.
Nigel Walley @ChimniWalley
This blog has been verified by Rise: R3e182c7cc5ba22627826714268f180ac
Lizzie Newman - In 2015 Chimni were part of the founding group of companies of the BIM4Housing working party. That year we held workshops and meetings with a wide variety of players in the new housing industry to evaluate the challenges we faced. The overall finding was that the house building community is having numerous difficulties with the adoption of BIM. 
A trip to the Consumer Electronic Show in Las Vegas has become part of the yearly calendar for anyone working in new technology. But, while it is traditionally full of interesting home tech, it has yet to achieve that must-see status for homebuilders. This year may change that, as CES 2017 was full of new ‘smart home’ and ‘internet of things’ technologies that appear poised to make the leap into the mainstream and therefore into our homes.
The number of power sockets now being requested by homeowners in new units was a first hint that a new wave of tech innovation was hitting our market. But this was simply about helping homebuyers who wanted to buy clever kit after purchasing a property. CES 2017 gave the hint of the extent to which new tech will impact, and have to be built into, new homes before purchase.
But screens had spread even further. Panasonic demonstrated glass room dividers and cupboard doors that doubled as PC and TV screens. Seemingly any surface in our homes will, at some point, be able to double as an interactive screens. For all the screen solutions on offer, none of the manufacturers could square the circle that digital technology has a much shorter lifespan than fridges or cupboards. Will people be willing to replace a clothes cupboard or a fridge because iPlayer no longer works on its screen?
Alongside the drive for ‘eco’ and low-carbon performance, there are the costs and speed pressures leading to modular and off-site construction. The proptech revolution as witnessed at CES looks initially as though it is pulling in the opposite direction. Most products on display only offered increased product complexity and cost for homebuilders, with the mitigating factor being the lack of clear consumer demand. 
Each of these phases is undergoing its own BIM revolution, learning to use the core BIM models, as well as developing plug-ins & apps suited to the specialised needs of each phase. Each phase holds issues and opportunities that the proptech world need to understand if it is to join in the revolution and make sure its products and services are compatible.
Architects have always tried not to design buildings in 2D but to think creatively in 3D. Unfortunately 3D functionality came late to CAD and its use in design and construction has always been patchy. BIM was built with 3D as native and it offers a much wider range of 3D functionality as core. The use of 3D modelling in BIM to realise ideas and concepts is now become a fundamental part of the design process.
But in BIM it’s a capability that is assumed from the start. A new generation of augmented reality (AR) and virtual reality (VR) plug-ins & apps that can extract data from BIM models are great examples of the extensions designed to keep core BIM files small and efficient. The simple accessability of BIM 3D means that clients, and even planners, can be engaged in the early creative processes like never before.
Once construction professionals get to the detail design stage, the shift from CAD to BIM becomes even more interesting for proptech innovators. Previously in CAD an architect would specify building components (whether construction materials or more complicated components like central heating systems) by putting an outline of the product on their drawings and describing it in written notes alongside. 
Now its being included in BIM models and a market for BIM Objects has grown up (around companies like BIM Store). This means that product and component manufacturers are having to undergo their own digital data revolution. They are now creating file and data formats that anyone developing ‘smart tech’ or ‘internet of things’ devices needs to be aware of and engage with. At simplest, any new ‘smart’ or ‘IoT’ device needs an accompanying BIM object file if it wants to be included in designs for new buildings. The really ‘smart’ manufacturers of new tech would be working with the BIM community to establish how to do this effectively, and how to ensure their products are included in BIM models from the start.
From a property tech point of view, the construction phase is potentially the least interesting area. But its important for the proptech world to understand this revolution from the contractors point of view. Previously, a contractor would be given print-outs of drawings, and revisions would be worked through on paper. Now, the contractor is invited to share the online model as a participant in a process and issues are worked out in 3D. 
The operation and maintenance (O&M) phase of a building’s life is potentially the most significant for proptech and IoT innovators as most tech innovation in our world (if we briefly ignore online estate agents) is focussed on changing how we run buildings. 
Homebuilding was always a problematic area in this fourth phase. One of the major reasons was that there were few professionally recognised ‘operators’ outside of the social housing sector to hand information to, once construction was finished. Buyers of new homes had no way of using CAD data and most of the 26M existing homes in the UK have no CAD file available, even if they could use it.
will allow construction & maintenance info to be delivered into consumer friendly apps (this idea is core to future developments stages of Chimni). We just have to work out how to unlock it for them. 
I recently signed up to a new online ‘community’ web site - a UK version of a recent US start-up. Going through the data entry process I put my postcode into the address page. It quickly found a match and then, in the process of identifying the community to allocate me, it proudly declared ‘you live in West Askew’! 
areas in the automated systems. The broader problem for web services being designed around our homes is that, if an area doesn’t have recognition from the Post Office (or anyone who currently runs an address system based on the PAF database) then it doesn’t exist on the web or in any web services that use those databases. Stamford Brook doesn’t appear on Google maps and, for data purposes, do not exist online. This means my home, in its current digital guise, is not where I (the homeowner) believes it to be, where my neighbours believe it to be, or where any of us would like it to be described as being in our use of local web services. This is the kind of nonsense that Chimni was established to resolve. 
