Successful entrepreneur and AstroLabs member Colin Manson, CEO of the tech firm Xergy talks openly about his journey, the challenges he faced and how he closed a multi-million dollar round.
Q1. So you’re from Aberdeen originally. Do you want to tell us a bit about the story of how you ended up in Dubai at AstroLabs?
Aberdeen is in Scotland and is synonymous with the oil and gas industry. After leaving university I spent all my time in that industry. And then in 2005, I finally got enough courage to set-up my own company, called Exodus. Business took off from 2005 all the way through to 2012 and we were in Fiston, Aberdeen, London, Perth, Australia etc. But we had no office in the Middle East, so we decided to open one in Dubai by 2012. The business continued to grow and in 2014 there was no plan to sell, but we got a pretty decent offer from a Japanese company and they joined in and took over. I stayed on for a while and then left the company in 2015.
I knew then that I needed to do something and I started thinking about how I would do it better next time, about the things that were really missing, improve my efficiencies, improve the way I onboarded and recruited people. And at the end, I saw it. I saw what I needed to change. I wanted to change the model. Freelancers just don’t exist in the oil and gas industry, so I started thinking that maybe I should do this as a tech company. I made a few phone calls and one of them was to my current business partner, James McCallum.
Now let me tell you about the story behind the name Xergy. James, when I had Exodus, had a very similar business called Synergy; we were competitors. When we met we took ‘X’ from Exodus, ergy from Synergy and that’s how we got our name, Xergy.
Q2. You’ve just recently closed a multi-million-dollar funding round. How does it feel?
I feel relieved. We actually should have been raising this money at the end of last year. It was quite a stressful time. We were ready to go and people promised to put money in and we had set a minimum target of GBP 1.5 mn, about USD 2 mn and an upper limit of USD 2.4 – 2.5 mn. And we were pretty much there. And then, of course, what happens? The world falls apart. Oil price collapses and stock exchanges around the world start to collapse. Every investor on the planet is like: “No Wait.” So the last few weeks have been a spectacularly stressful time where there are moments when we thought it might not happen, but it did. We officially closed it!
Q3. You raised some funding at the beginning though friends and family. Did that put additional pressure on the business to make sure it’s a success?
I was very careful saying to them, you know, “Look guys, we’re an early start date company, we go late into a sale”. How many tech companies succeed? You know, the chances are low. But what I was supremely confident about is that it was a good idea. And we also had some seasoned professionals which a lot of tech companies don’t have. Plus, James and I both know about the state of building a business.
There were definitely moments last year when I was worried, but I’ve never doubted the technology. We had data, we had facts that the product would be successful. I definitely want a lot more people in this time, not just friends and family.
Q4. That’s interesting, not having institutional investors also put the organization in a very different position. I think actually by keeping institutional investors out at that stage, did give you that freedom to run as you as you see fit?
That is absolutely right. I think it would depend on where you go and who you are, and if you’ve done it before. Sometimes having an institution is safe, because they instill a discipline that you may not have. And I think it would have been difficult for us, given that we are all seasoned professionals and we all have our own ways of doing things. I think it’d be difficult for an investor, in an institution; we are very conscious of it.
Q5. You’ve talked about your partner James McCallum. He used to be a competitor, he’s now a partner. Tell us about that relationship??
James and I, there is a rapport; a lot of sitting in the office together all the time. I don’t think some businesses work with a dictatorship, but most businesses do it. So I think there has to be some form of compromise there. Somebody started off in one direction or another is going in another direction, leaving everyone behind. You need somebody to be in charge. And as I say, as a sports fan, as a proper CEO, I got a lot of money, a lot of people’s money that I have to spend properly. We are in the phase now where we need to monetize the business. So when you go into sales fees, you go into a big marketing phase. And that’s where James’s skills come into play a lot more. And I think it is also about the structure. James is the chairman of the business. I am the CEO of the business.
But if James and I would have gotten into business together back in 2010, when I had exodus and he had synergy, back then I was a lot younger and a lot more headstrong, then I think it could have ended in tears.
Q8. What do you see for the short term, both in Dubai and the economy at large?
Well, it’s an absolute disaster on a global scale. We’ve designed this product three and half years ago, initially for oil and gas and that’s the market we will initially sell to but we ask ourselves, can we be competitive again in the gas space and design it to facilitate a new way of working? Which is something you guys cracked five years ago, with your coworking space. You don’t need an office that’s got 100 desks, you just let people work from home. Having a safe harbor unit like AstroLabs where you can go to or one of the meeting rooms, it is so much more cost effective from a business and overhead point of view.
Q9. Where do you see the benefit in terms of coming to a space like AstroLabs and how did that help you as a business in terms of flexibility?
I say this from the bottom of my heart, I went to AstroLabs upon Farzal’s recommendation who was a great guy and who did a brilliant job for us. I called Farzal and said “look, what we’ve got is really good but it’s not great. I want it to be great.” And he said “Speak to Michelle at Hy-On. She’s at AstroLabs.” I went and met her and I liked her. Of course we engaged Michelle. I thought I needed to be part of this and get a permanent desk. And we had a couple other people, a couple of years back. Some SEO work and some website work; they work in there. For me, since I don’t know the tech community, to be in there and be surrounded by people who do, and services that I could access, was just great. Plus, I like going to the office in Lakeside where I spend a lot of time.
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