Author Archives: TBR Network

Landing in Trouble: Ryanair's Position Amid Coronavirus Meltdown

By Robert Tolan

Friday saw Ryanair CEO, Michael O’Leary, announce a temporary 50% pay cut for all employees, including executives, in an effort to bolster its balance sheet amidst the uncertainty of the situation sweeping the world. Given the trajectory of its share price, now €8.81, a sobering 50% decline compared to its January price, the terrain ahead may be looking worse for shareholders.

O’Leary’s decision was merely an attempt to slow down the bleeding that started last week as deaths from Corona virus soared. International travel has now been brought into question which brings problems of its own for air travel within Europe’s Schengen area, the largest revenue maker for Ryanair, and indeed uncharted territory for free movement. As the European economy is stuck in gear for the foreseeable future, O’Leary has hinted at the possibility of future redundancies.

    The threat of heads rolling within the company probably could have come a little sooner. The current debacle is not a cause but rather a symptom of deeper issues within the company. Consider the following facts; it traded at a high of €18.41 almost two years ago, the price has been down trending since, Ryanair has undergone a major re brand, profits have stagnated despite increasing passenger numbers and industrial relations issues have become a mainstay of the company.

 With €4bn in cash equivalents the company will not be able to weather the most adverse pandemic scenario, the European economy stalling well into the summer or even later, and so some sort of guillotine must be brought to the stage. The maverick O’Leary must return for his company’s fortunes to reverse.

    The more liberal of observers will say Ryanair ought to wait out for government support of some sort. This is entirely unreasonable. The government assistance Ireland could afford is not enough to keep a pan-European airline afloat and the EU’s bureaucracy and failure to codify an approach to assisting businesses in ‘black swan’ events such as pandemics mean neither fig leaf will come in time. Ryanair could find itself occupying the grave beside Flybe, which was offered government support that proved fruitless, if it is not careful.

    This would cost thousands of direct jobs and tens of thousands of indirect jobs. The cuts required in the short-term would amount to a few hundred job losses and indeed those people affected would be entitled to redundancy payments. Certainly this act could ease industrial relations woes for the time being as the seriousness of the situation facing the company strikes employees. Only then will investors change their minds on Ryanair and see value in the €8-10 range which will recapitalise the company.

    It is also advisable that O’Leary reduce the number of subsidiaries, now 11, to fortify the company’s financials. As significant amounts have been ploughed into the recently acquired Laudamotion and the 1-year old Malta Air, merging these, for instance, offers the most sensible way of achieving economies of scale. There appears to be far too many duplicate processes concerning HR and marketing across the group which must be eliminated for the company to once again become an investor favourite.

    Regardless of the action taken by Ryanair, it is becoming increasingly apparent the Irish economy needs activist investors for its most prominent companies to flourish. If it were US-based, it is unlikely it would have escaped the clutches of value hungry investors like Carl Icahn or David Einhorn. There is certainly plenty of value to be found in Ryanair, there is still a need for a low-cost airline, but the execution of the business model has deteriorated over the years. The best antidote to this is somebody willing to force the necessary, and in this case obvious changes, who is willing to take the decision O’Leary has in recent years shied away from. Failing this, thousands of jobs rather than a few hundred may be lost.

Striking the Balance: Will Hindsight Lead the Way?

By Sinéad Flynn

Overview

Innovation and technology are the most prominent buzz words for firms and corporations around the world. The next big idea, next invention, and next discovery are waiting to emerge. Society has evolved from the 1880s, where it was once thought by Commissioner of US Patent Office Charles Duell that “everything that can be invented has been invented” to new advances exploding at our fingertips without limits. FinTech has received a great deal of attention, and it’s only in its infant stages.  Marc Andressen notes that ‘internet companies might end up in 180 countries before they have 180 employees.’ Globalisation and technology have had a huge impact on markets, and the role of Fintech is just a new stimulation.

What is Fintech?

Fintech is a financial technology that aims to compete with traditional financial methods. Fintech can take the shape of crowdfunding, cryptocurrencies, or blockchain, and notably is expanding into new markets rapidly. While online banking has been prevalent for years, fintech adds a new dimension to the payment’s services. Within seconds, users are sending and receiving money faster than ever before. Fintech has begun to dominate our everyday lives where it is commonly seen with those who use Apple Pay or Samsung Pay or those that have sent funds via GoFundMe. The limits to what may be considered Fintech can be unlimited, where most start-ups are embracing technology to create innovative products and services. FinTech is emerging throughout trading, insurance, and risk management as well, which has appeared quite disruptive to these industries that haven’t changed for quite some time.

Opportunity or Threat?

While business may be booming, and the financial crash seems to be forgotten, how does commercial law interact with this fast-paced business environment? It is argued that fintech firms receive a competitive advantage and create an attractive space for investors when they comply with regulations. Cryptocurrency companies and those that are an unregistered seller of securities have been hit hard in the US by the Security and Exchange Commission. These fines have diminished confidence in these certain start-ups and created financial loss through settlements and fines. There are concerns that fintech firms are utilising their institutions to harbour illegal assets utilised for criminal activity. While fintech firms have been embraced for their revolutionary growth and modern methods to business in this age of technology, it must be approached with caution due to poor ethical choices being made at times.

Striking the Balance

Countries such as Ireland that rely on a great deal of foreign direct investment must adequately strike the right balance between attracting new business, but also ensuring the system is not abused. Research shows that there is no specific legislation designed to regulate certain services that fall under this broad FinTech category, besides those concerning the Central Bank of Ireland and minimal EU Regulations. Ireland is a lucrative location for start-ups and businesses looking to set up a European hub, as they have more freedom to do so while then receiving this passport into the European market. Diversity in our financial markets reflects this growing desire to explore alternative mechanisms to enhance society. While research is ongoing for the limitations and effects FinTech firms bring to the table, these initiatives are looking primarily to law firms to structure and protect their interests.

A Closer Look

If one narrows the analysis of Fintech into electronic payment companies, the Payment Services Regulation 2018 will apply. This Regulation has effectively created a more level playing field for fintech start-ups to enter the market and develop their technology services further with an overall aim to increase competition for the benefit of consumers. At the moment, it is argued here that the EU is fully embracing these innovative and competitive practices. If one assumes that the market will regulate itself and that the legislature should be more laissez-faire, then more relaxed regulations should be welcomed. While this may be worrisome to those that appreciate the traditional style of banking and finance, this is ultimately a positive step, as time and time again, traditional banking models and financial institutions of the past have failed multiple sectors leading to dire losses.

Has the Balance Been Struck?

The right balance must be struck in order to protect investors, but also to facilitate this necessary development. The Central Bank of Ireland is conscious that there is a lack of legislation specific to Fintech entities, and that it has assumed the role as the main regulator where able. This leaves investors and innovators in a precarious spot. In one regard, there is little law guiding their activities, but in turn, this allows them to receive the freedom necessary to develop and surpass imaginable limits on their ventures. While the Payments Services Regulation may increase accountability and reporting, this may not be enough to accurately analyse how these institutions are operating.

What Next?

The embrace of the change in the financial markets may be a positive step, and a mechanism that may prevent future economic crashes and downturns as new perspectives and ways of managing the financial sector are introduced. Consumers must be wary for that this partially unregulated ecosystem may produce detrimental effects that hindsight may prove useful.

EVE: Making it Easier to Own an Electric Vehicle

EVE is an e-mobility solution project in the process of being founded by two postgrad students in Entrepreneurship at Trinity Business School, Sarah Rust and Oana Rosca. 

When Sarah’s father wanted to buy an electric car in Germany, he soon became very discouraged because of range anxiety: there aren’t enough charging points in Germany and switching to an EV would have seriously affected his family’s freedom of movement. 

The start-up aims to provide a ​P2P network of private charging stations for electric cars​. Customers can charge their car anywhere and make a passive income from their unused charging station at home.

 The Team

The founders have a combined business experience of 12 years. Sarah has worked in the automotive industry and the startup industry for the past three years and brings energy and connections with both the automotive and startup sector. Oana has 9 years of experience in tech management roles in different industries and has a network of software developers that she will leverage to build the product. 

Where We Are Now

The founders have analysed the idea from different perspectives during their studies of Entrepreneurship and have applied the concepts taught in the programme. They have participated in the LaunchPad Sprints Incubator November 2019 and won 2nd place on the Sprints Final Pitch competition. This secured them a place on the TES Incubator. 

Plans for the Future

While they are working on fine-tuning their concept and assembling the puzzle pieces of their idea, Sarah and Oana are ambitious about the future. 

In the short term, they are eager to join LaunchBox 2020 and are busy preparing their application to the programme. By the end of the year, they plan on launching an MVP in Germany and other European markets in the upcoming years. 

In the long term, they want to explore and pursue new ways of increasing sustainability in day to day life through the sharing economy. 

Get in Touch

If somebody has an electric vehicle or knows an EV owner, we would appreciate if they could reach out to us so we can ask them a few questions, at roscao@tcd.ie​ or ​rusts@tcd.ie​     .​ 

Divorshe – The Trinity Smart-Tech Legal Start-up Empowering Women

The Divorshe team was brought together in Trinity’s MSc in Entrepreneurship last September, with the idea emerging from our “Business Model Innovation” module. Having bonded as a team and having delivered the module’s winning pitch, we decided to pursue the concept further.

Divorshe aims to empower women going through a marriage break-up by making the process of obtaining a divorce easier to understand and more time and cost efficient. Using smart legal tech, clients complete the paperwork at a time convenient to them, from the comfort of their own home. Client-solicitor meetings are conducted online and can be held outside traditional 9-5 office hours, minimising disruption to these busy women’s lives.

Unlike traditional law firms whose services are very costly, or low-cost DIY divorce services who lack legal expertise, we take the best of both worlds – family law solicitors and online documentation – to provide a quicker and easier to understand service.

The Team

Our team was brought together in Trinity’s MSc in Entrepreneurship in September this year and went on to win that program’s “Business Model Innovation” pitch.

Our team varies in experience and background but has a common overarching entrepreneurial passion. Avice studied humanities and communication in college in America. Fernanda studied Hospitality Management in Brazil, worked in hospitality for a few years developing new hotels, and started her own businesses shortly thereafter. Neil graduated with a Bachelor’s Degree in Management Science and Information Systems Studies from Trinity in 2009. He has spent his career to date working in a variety of product development roles, primarily in the online gambling industry.

Where We Are Now

Since September, we have created links with solicitors in Brazil and Ireland for guidance on the legal process, and have the commitment of a software engineer to explore the technology solution. We have already purchased the divorshe.com domain.

Over the coming weeks we plan to conduct further market research and begin a proof of concept for the technology platform, as well as launching our online landing page to begin to collect expressions of interest. At present, we are also working on connecting with solicitors to help advise Divorshe through Launchbox.

Our Plans for the Future

In the near future (within the year) we see Divorshe being a working product (approved by Irish Law Society), fit to serve our test market of Ireland. We will be seeking seed investments in order to get our product up and running, and serving the public.

Potential challenges that face Divorshe on this journey consist of the legal regulations, the lack of publicly available market research, and the expense incurred from recruitment.

In order to overcome these challenges, we have committed to continually seeking expert advice as we move forward with our MVP. As it is a sensitive and confidential service, which is heavily regulated by the Law Society. It is crucial that we validate each milestone with the corresponding expert to avoid any roadblocks and keep Divorshe on track.

Conquer Media – A Trinity start-up seeing rapid growth in web and app development

Overview

Conquer Media began in December 2018. I, Gareth Power, was sick of getting insane quotes (even for minimum viable products), for web and app development from Irish agencies. I wanted to create a low-cost, yet high-quality solution. I teamed up with some colleagues from my computer science course and began using APIs and efficient code to save time without sacrificing quality, allowing clients to save up to 80% on normal costs for developments. This is exactly what makes us different. We also take great care in each project we work on, ensuring we use our innovative skills to transform our clients’ ideas.

The Team

Gareth Power – I, Gareth, am the co-founder and CEO of Conquer Media. I have six years of experience in programming and mobile development. I have won multiple awards for my work, including 2nd place in Apps4Gaps 2016.

Séamus Conlon – Séamus is the CBO of Conquer Media and a business student in Trinity. He organizes negotiations, contracts and strategy for the business, ensuring that professionalism is maintained.

Declan Roberts & Conall O’Toole – Declan and Conall are both sales reps for Conquer Media. They arrange the acquisition of new clients for the business. Both are computer science students.

Where we are now

We have currently turned a profit of ~ €17,000. This is thanks to an array of web development clients and more profitable mobile app development clients coming onboard recently. We are beginning to expand from smaller businesses to more established SME’s and develop customized software for businesses. We currently hold contracts totalling €8,000 and are in talks with larger businesses to grow this figure. Our team is constantly improving and developing our skills to deliver higher-quality services. Our website at conquermedia.ie has just been redeveloped and recreated to a higher standard than before.

Plans for the future

We plan to expand using both online ads and our sales team, which is growing stronger every day. We plan on targeting larger clients and businesses, where our developments can have more impact across different industries. Examples include the construction and auto industries, where efficiency is key. Our problem-solving abilities allow us to provide invaluable solutions for pain-points in those industries. As we grow our client base, we plan on outsourcing to high quality developers to increase our capacity, while maintaining the efficiency and value that our clients expect.

Get in Touch

If anyone would like to get in touch to work with us or discuss developments, please contact gareth@conquermedia.ie

Trinity’s Budding Entrepreneurs Battle it out on TES Incubator Pitch Night

The TES Incubator Pitch Night, sponsored by Elkstone, was held in the Tangent Main Event Hall, 1st Floor, Dublin Business School, Trinity College Dublin on the 3rd October 2019 on a stormy (Lorenzo) evening.

The event was completely booked out and the attendance was a full house to see 14 teams pitch for 8 places in the esteemed TES Start-up Incubator Mentoring Program 2019/2020. 

Each team had a strict 3 minute pitch with presentation along with 2 minutes Q&A by a leading panel of Business Professional Judges who were not going to go easy on their questions for each team.

We kicked off the night with advisor.works who pitched a solution to the problem of dropout rates of students in postgraduate studies by offering global real-time professional advisors. With 8,000 active members and 18 active business leader advisors on-board, the bar was set to a high standard.

Next up was ARea, an AR / VR Solution for renting expensive office space via a VR device that offers a VR Office Space for start-ups globally. The advantage of this system over Slack was that users ‘felt in the same place!’ and over time they had a compelling pitch.

Next was CAMPA, a company that provides a solution to the aftermath of festivals by offering reusable rental tents. These would be sold B2B, set up and rented to festival goers. These Dome Shaped Elevated Tents made from recycled plastic would be waxed and flame retardant. With a global market of 1 billion they feel they can excel against costly glamping competitors.

Conquer Media were the first team to have actual clients. They are in the Digital Development Services Industry and provide student value and business scalability. Cheaper than the €10k – €20k market by €8.5k – €17k the market size is in the trillions. Competitors include Armour whose products are more expensive, and Upwork which do not have the same superior quality they provide. To date they have turned a profit of €10k with 10 websites.

CROWD are a Casual Event Creation company whose competitors include Bumble and Meetup. Their main difference is that there are not so many steps involved to navigate their system as others. The Core System is a standardised event creation module with One-Touch Technology. It can be aimed towards travelers who are new to a city, for example. The revenue is created from subscriptions and the premium user community. www.crowdapp.com

EiSHT is a Personal and Professional Development programme designed to promote an Emotional Intelligence, Skills, Employability, Professionalism, Gratitude and Social Citizenship solution for the youth of today.  They have measured the quality of their results on the young people who have completed the trials. They have come to the Incubator for Inclusion, Mentorship and Learning Management Workshops.

Forever Shampoo is a B2C solution in the concept stage. The problem is single-use plastic and their solution is a reusable shampoo bottle where you buy a tablet that you mix with water. Their market is socially aware customers and their competition is shampoo bars. Their revenue model will rely on postal subscriptions and Adware. They come to Incubator for Mentoring, Networking & Funding.

Fensei is a Peer-to-Peer learning and mentoring solution at a Market Value level that is not as expensive as personal mentorship. Their competition is not as exciting or engaging. Their revenue model will be comprised of subscriptions, in-app purchases and Premium Mentors. Their quality checks will be via Mentee reviews to access mentor skill levels.

Karmic Coffee Company offers a low sugar, cold textured (nitro) caffeinated beverage aiming to solve the problem of sugar filled cola and competitor cold coffees. In the EU the average person consumes 5kg of coffee per year. Their competition seems to only be Starbucks and their unique selling point (USP) is Locally Produced Coffee with prolonged shelf life.

MediTree is a solution to the healthcare service to Automate and Diagnoses through Machine Learning & AI. It is targeted at healthcare professionals via a healthcare platform. Phase 1 will tackle Blood Samples, Phase 2 will tackle blood PODS which Phase 3 will incorporate into Workflow AI Models for phlebotomists. Competitors include Evolve.

MEC is a Biotech Device solving the problem of culturing cells in Petri dishes which solves the Shear Stress Range Problem. The solution is In Vitro Cell System for Research Labs where the global market value is approximately $12.7 billion. Their competition is the IBIDI System costing $23,000 while they are on their second prototype costing $300-$500 to produce at present.

REZero has a solution for the Single Use Plastic Problem. This is a Swiss-manufactured durable, reusable takeaway container worked on a Deposit/Return Model. Market competitors include CoCup and down2earth. They have sourced the containers from Switzerland and are talking to 3-5 clients at present. They hold the sole distribution rights for Ireland. The enticing nature of this product is that it poses zero cost to consumers.

Sweet Tooth App provides quick tasty treats (desserts) to all focusing on speed and quality. Their business model will be B2B and Subscriptions with a target market of 24-35 year-olds. Their competition is Just Eat and Deliveroo but they intend to improve the model by putting a strong emphasis on customer first.

Wave Tuk Tuk is a €1 Ride (Max 3km) for elderly people who like to be independent. Instead of walking 700 m to public transport they hire a Tuk Tuk for €1. The target market are students in college or the elderly. They plan to launch a location dependent service in Asia, Africa and the UK. The return on investment is the driver purchasing the Tuk Tuk for €2.5k, running the service and selling it on within 3 years.

The places were awarded to REZero, Karmic Coffee Company, Forever Shampoo, Conquer Media, EiSHT, CAMPA, MediTree and MEC with a wildcard place still up for grabs.

Joseph Keegan

TES Incubator Ambassador

BSc (Hons) Computing (Data Analytics)

No Basis for “Basis of Contract” Clauses! Time to Abolish?

By Luke Gibbons

The judicial unease lamented in Keating v New Ireland Assurance [1990]2.I.R.383 surrounding “basis of contract” clauses is well founded.  However, it is contended, that this disapproval is frivolous, as notwithstanding such, these clauses are upheld by Irish courts. This allows insurers, often the more powerful contracting party, convert a pre-contractual representation into a warranty, and thus, gives the insurer a right of repudiation. It is argued, this consistently leaves the insured bearing the loss, and in so doing, undermines the premise on which insurance is based, that being, protecting against future losses. Furthermore, it is submitted, that the rationale used by the courts in upholding these clauses is flawed and in deeming such as valid, the courts are running the risk of ironically circumventing the materiality burden in misrepresentation and nondisclosure, as developed by said courts to protect the insured.

In Keating, the recognised rationale in validating these clauses was freedom of contract. Although, this seems infallible, as two legal entities are willingly entering an agreement. It is contended, that in the insurance context, such does not consider the idiosyncratic reality of these transactions, and ultimately, the inherent imbalance of power between the parties. One argues such, as every business, no matter how powerful, is required to have insurance in some respect. Therefore, it is submitted, as these entities must enter into contracts with insurers, often having no choice in so doing, and not being subject to the EC (Unfair Terms in Consumer Contracts) Regulations 1995; the courts in upholding “basis clauses”, on the grounds of freedom of contract, are failing to acknowledge this inherent imbalance in commercial insurance agreements. The insured is not free to enter into a contract at all, the insured must enter into a contract to avoid future losses and being in breach of relevant law.

As held in Keating, non-disclosure or misrepresentation can only render a contract void if such facts are deemed material, and it is proven that these were known to the insured during declaration. However, “basis clauses” differ, and as denoted from Keating, any undisclosed information, no matter how insignificant, if under a “basis clause” may lead to repudiation. Although post-Keating, “basis clauses” must be outlined in clear terms and if ambiguous the contra proferentem rule shall apply, such judicial intervention is inadequate. It is submitted, the holding, by confirming the validity of “basis clauses”, still arguably allows insurers use suchto circumvent the burden of proving materiality, and ultimately, undermine a threshold designed to protect the insured.

Thus, it is undisputed that reform is needed, however, the question still lies: should “basis clauses” be unlawful? There is some credence in the New Zealand approach, which incorporates a “materiality test” in accessing non-disclosure and misrepresentation under “basis clauses”; much like the approach to warranties in this jurisdiction and the guidelines promulgated in Irish self-regulations. It is argued, that on one hand, this would bring homogeneity to the treatment of warranties, and ultimately, ground “basis clauses” in their foundational origin, that being, as Foss states, “[use] …with…clauses permitting the insurer to avoid the policy… [due to] …material misstatement” (‘Good Faith and Insurance Contracts’ 2010). However, on the other hand, the plaguing question of what is material would still exist. Furthermore, is it contended, that if such is adopted, insurers would cease using “basis clauses” anyhow, as such would not have the “trap[ping]” effect they are designed to have, as described in Zurich General Insurance Co Ltd v Morrison [1942]2.K.B.53. However, reliance on insurers ceasing use and the unpredictability surrounding materiality is too uncertain a basis upon which insurance law should develop.

Therefore, in agreement with the Law Reform Commission, it is proffered, that the Australian approach be adopted, banning “basis clauses” entirely, as such is definitive, and in turn, champions certainty in commercial law. This is also advanced, as Buckley ((2005).12 Commercial Law Practitioner 10) laments, the current self-regulation is “inadequate”; a view solidified by CB Justice v St Paul Ireland (Circuit Court 25/11/2004).  Nevertheless, it remains to be seen whether the Oireachtas will stifle this unacceptable practice and remedy the unfortunate reality as described in Anderson v FitzGerald (1853)3.ICLR.475, that “basis clauses…[render the policy] not worth the paper upon which it is written”.

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