Crunch diverts hedgehog as small firms buy more
Mar 24 2009 by Karen Dent, The Journal
Name of business: Hedgehog Lab Ltd
Location: Gateshead
Line of business: Software vendor and consultancy
Directors: Sarat Pediredla, managing director, and Mark Forster, director of technology and products.
How long have you been established?
We have been trading since May 2007
What have been the biggest achievements so far?
It would be the release of our initial product after months of development; ‘fixx’ – a bug tracking and project management system.
What have been the biggest hurdles so far?
Our biggest hurdle has been adapting our business model in a rapidly slowing economy and the credit crunch. This means that we have had to radically redefine our business and refocus on our smaller clients who are not necessarily adversely affected by stock market and financial market conditions.
Where do you go for advice?
We get most of our advice from peer groups and other fellow entrepreneurs who are in the same situation as us. We have had excellent support from our investors and clients in shaping our business.
How is running the business different from the early days?
As a relatively young company, not that much has changed for us. We still work like a start-up although we now have the experience and hindsight handed over from the past year.
Have you met your financial targets?
We met our initial financial estimates but missed our ‘ideal’ target due to the slowdown in spending activity with our service clients and a delay in releasing our first product. We are, however, making great gains in this quarter and hope to exceed targets next year due to our refocused strategy.
How do you attract sales?
Most of our sales are through word of mouth, the internet and network building.
How has your business plan changed?
When we initially started Hedgehog Lab, we had a huge focus on big-ticket customers with large budgets and sizeable projects.
By using this method we were actually turning away small business customers to focus on larger clients.
However, when the credit crunch hit, we realised that the most affected were the larger clients (with shareholder responsibility) and the small business market was actually increasing technology expenditure.
So we have now refocused our strategy to work with a lot of start-ups and smaller businesses, who now drive a majority of our service revenue.
What does the future hold?
With our product pipeline finally maturing and with our new small business ‘CRM package’ in development, we intend to increase product revenue exponentially in the next year and introduce more products in the future.
Ideally, we would like to be driven 100% by product revenue, but we have a long way to go before we achieve that successfully, although, I have no doubt we will get there in the next three years.
Are you glad you did it?
Absolutely. I have learned more in the first year we were in business than I have learnt in university and several years of full-time employment combined. And it is great to not have a boss!
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