CafeScreen’s win with technology
Thursday, 15 May 2008
Last Updated: Thursday, 15 May 2008
By Amanda Gome
If you’ve logged on to free WiFi in a cafe recently or passed the time watching a TV screen, chances are you can thank CafeScreen’s entrepreneur Ruwan Weerasooriya.
Technology entrepreneur Ruwan Weerasooriya is only 34. But he is in the middle of another start-up – this time with CafeScreen. So far he has invested almost $1 million of his own savings across the group.
But CafeScreen is only one company in his portfolio. Is he a distracted entrepreneur or is he an emerging media entrepreneur?
He talks to Amanda Gome about new media, business models and some harsh lessons he has learnt along the way.
Ruwan is happy to answer your questions. Send to feedback@smartcompany.com.au before the end of business Monday 19 May.
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Amanda Gome: What is CafeScreen?
Ruwan Weerasooriya: We place big digital screens in cafes. The screens carry advertising and information and entertainment, targeting the CBD business professional. We also supply free WiFi internet hotspots in CBD cafes that are a bonus to the customers who increasingly are conducting office meetings, desk research or working on a laptop.
How did you get into that? What was your background?
I was a pharmacy student, dropped out and started an ISP in 1994 at a time when a large user base was 1000 users. I sold that towards the end of 1995 and founded web development company Method + Madness, which was sold in 1999 to Sausage Software.
How much did you get when you sold that?
We sold it for more than $6 million, so I got a few million.
So what then?
I moved to Melbourne and went back to what I love; start-ups. One of the companies I started was Touch Taxis. We put a pilot of 50 into Silvertop taxis. The touch screens were mounted to the headrests and people could surf for news, weather, and information such as what film they might go and see. The screens were connected wirelessly to the computer in the boot.
Did it work?
First it was a very costly exercise, as we had to develop the head rests with a computer in it. And we had to run a computer in a car and updating on a regular basis. The fact that we did it first off was a technological feat.
We were not as good at articulating who the audience was. The business model was that we were relying on advertisers to pay. We were using banner advertising so people scrolled through content from NineMSN and saw ads.
We then tried to sell that to media professionals so they could match it against advertising needs. I learnt, coming from a non-media background, that even though technology is the big equation, you can’t lose sight of who the audience is when dealing with advertisers.
We were good at telling people how it worked, but not how it related to their clients or their campaigns.
It was a big investment taking the vehicles off the road as even half a day to fit the screens was a challenge for them. Also the burn costs were huge. The data cost across a GPRS network was very expensive.
Another issue was the legislation in NSW that precluded advertising in taxis. We thought if we proved the model in other states, they would change it, but it became apparent that NSW wasn’t going to budge. That knocked legs out of model going forward, as if you are not in Sydney it is very niche.
What gave you the idea?
I am actually an angel investor in it. My two partners came up with the idea. I put in the cash, and from the huge incubation team delivered programming and the technological skills, with equity and an executive role to drive it.
How much did it cost to start?
We did it on the smell of an oily rag and bootstrapped it with $150,000.
But you knew that at the start…
We took a calculated risk. We were undercapitalised, but we thought if we can show the technology will work and show commercial success, we will get the support of a large media company.
We had chats with leading digital and advertising companies which was a good experience. But one of the things that came out of that business was establishing a great network (among advertisers).
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