Herman Errico at the UCD Smurfit Business School. Image: Shane O'Neill/Coalesce
Based in Dublin, Blendgate was launched only three months ago and is picking up pace as a tech consultancy marketplace of choice in Ireland and beyond.
Herman Errico is man with many feathers in his cap. With a master’s degree in engineering, another in law, and a third in business administration, Errico is a strong believer in formal learning as seminal to creating a strong and sustainable business.
After spending years working in the technology consultancy sector, most recently as a senior manager at EY Ireland, Errico is putting his theory to practice. He has founded an online B2B marketplace for technology consulting services aimed at small and medium-sized businesses.
“A marketplace is more of a complex business and go-to-market challenge rather than a technical one,” explained Errico, an Italian Argentinian who moved to Ireland five years ago.
“There are complexities associated with technical scale and optimisation, but with today’s technology one can build a marketplace using pre-existing components such as microservices, even though the new tech trend is shifting back to data centre-based monolithic architecture.”
‘Blend between marketplace and professional network’
Blendgate, launched in February, pitches itself as a marketplace that allows customers to procure consulting services and run due diligence “within minutes”, with the help of a database that has around 100,000 verified consulting firms.
“We also support consulting firms decrease their customer acquisition costs, increase consultants’ ‘billability’ and optimise marketing budgets,” Errico said.
“To achieve this, we have created a B2B market network that is a blend between a marketplace and a professional network with two distinct SaaS models – one for buyers and one for suppliers.”
According to Blendgate’s website, there are free plans available for buyers and contractors looking for tech consultancy services, while plans for suppliers range from €50 per month to €130 per month depending on the number of consultants the company has.
“We obviously need to have a social feed, messaging capabilities, payment infrastructure (we currently use Stripe), but we have also have to consider emerging technology such as AI and blockchain,” Errico said.
To that end, Blendgate is planning to deploy an AI-based co-pilot to help customers buy services and run due diligence, validating project credentials with blockchain technology so “one can finally buy consulting services from companies that have actually done that work before”.
“Our ultimate goal is to improve the overall trust in the consulting industry as consultants are a great tool to go faster. However, we have observed too many distortions because of market inefficiencies, which lead to a general distrust in the role of the consultant,” explained.
“We believe that a better consulting industry – possibly a smaller sized one – could become an economic motor that can allow the global economy to grow faster.”
‘Cash is king’
Currently operational in Ireland, the UK, the US, Germany and Italy, Blendgate is in the process of raising seed funding and plans to hire 15 people in Ireland by the end of next year – doubling the team’s size. Since its launch in February, the start-up has grown from two to nine people.
A firm believer in the age-old adage “cash is king”, Errico believes the best strategy is to generate revenue as early as possible.
“This will allow our customers to get more value, our employees to enjoy a more comfortable life and our investors to appreciate the sustainability of our business model,” he said.
“In today’s microeconomic environment, start-ups have to go back to basic principles of cash flow, stable run and burn rates and revenue-backed valuations.
“Funding remains a constant challenge for us – and for all start-ups in general – but being already a revenue-generating business helps us navigate the period between being ‘too early’ and ‘just right’.”
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