International Business Management

Table of Content
Impact of tech startups on traditional business markets........................................1
Introduction......................................................................................................... 3
Digital history...................................................................................................... 4
Dotcom bubble................................................................................................. 4
Financial crisis.................................................................................................. 4
Startup bubble................................................................................................. 4
4 potential startup companies............................................................................ 5
ZERVANT.......................................................................................................... 5
TEICOS Pharma................................................................................................ 5
Biz Chatbox...................................................................................................... 5
LUXEXCEL......................................................................................................... 5
tech startup creation........................................................................................... 6
Conclusion........................................................................................................... 7
References............................................................................................................. 8

Rodrigo Verschraegen, Olivier Elewaut & Heline Jaf

Introduction
The technology we have chosen isnt really a particular feature, but a whole other B2C or
B2B market to explore. Many small traditional or even larger businesses who are dependable
on other businesses through outsourcing of their services remain with the most prestigious
and most traditional companies. This not because they are the best, but because they are
best known in the market.
In this report we will give a general explanation on the general startup company and what it
may offer the small or traditional company, what the more mature prestigious companies
cannot.
First a description of the overall startup company will follow. A startup company is like every
other business a company or a partnership specialized in a certain field, most of the time in
the digital world. But it is generally accepted that when talking about startups, they mean
mostly venture created companies that hold some risk and dont guarantee they will succeed
in gaining a profitable share in the market. So caution is always demanded when Dealing
with these companies.
The reason why associating with tech startups for regular or small businesses is promising,
is because of the general corporate strategy a startup company usually has. Because of their
lack of resources and lack of popularity in their market, they must strive a certain strategy in
order to survive. For most startups this includes; having a very specific qualitative product for
a specific niche, and, holding their price below the normal market value maintained by their
competitors. Overall this strategy is called the penetration strategy. This holds in, that the
business offers its products at a lower price than the competition in order to gain the attention
of the customers and slowly grab away some market share from their competitors.
When thinking of tech or any other startups, it almost always goes hand in hand with another
word, namely innovation. Creating innovation truly is the main goal of these startups and is
therefore closely related to the qualitative aspect their product or service must have in order
to survive.
There are many innovations linked with these startups. Nowadays we have startups
specialized in 3D graphic modeling, pharmacies,...
In this report we will briefly talk about the dotcom bubble in 2000, followed by the global
financial crisis and how it affected the business atmosphere. Now 15 years later the tech
industry is booming again with all sorts of tech startups that bring value to all of the world.
Even today, some experts talk already about a new bubble, the startup bubble. Besides that
we will go a bit more in depth concerning the digital market and the ease of creating these
startups
After that we will discuss 4 unknown startups that might offer their services for any small
business of today, promising more quality and better pricing than their traditional
counterparts.
Finally, we will present the startups throughout history that had the biggest impact on our
society of today. Here we immediately think about companies like Facebook, LinkedIn,
google, Even some lesser known companies like PayPal improved the business
atmosphere for all sort of businesses.

Rodrigo Verschraegen, Olivier Elewaut & Heline Jaf

Digital history
To give a better view on the rise of these startups it is important to shed a light on the entire
growth of the digital market. This involves discussing the dotcom bubble (that eventually
burst) where the first digital startups rose up. After that, the financial crisis will be briefly
discussed. To finally end where we are now, the potential startup bubble.

Dotcom bubble
In the late years of the 1990s, one of the largest increases of the NASDAQ had been known
since that day. In almost a decade the NASDAQ rose from 1000 points to almost 5000
points. This was caused by a large increase of venture capital equity investments in digital
companies that at the moment were recognized as the next major profitable corporation. In
the beginning stages of the, then not yet recognized bubble, many corporations turned out to
show large growth capabilities. But failed at creating a consistent flow of income to sustain
their growth in the future. As a result the investors were disappointed in their investments and
ended up with large cap companies with almost no profit potential. Eventually the investment
mentality turned sour and the bubble bursted, making sure that many people across the
world lost a lot of money.

Financial crisis
Different reasons and causes of the financial crises have been defined by already a lot of
people. Some of them still arent sure if the plunge of the real estate market was a bubble or
not. But despite these doubts there are certain things that we are certain of. The main reason
for the cause of the financial crisis was the continuous rise of the prices for real estates,
which was followed be a drastic drop of these prices.
Well, but why did these prices of real estate rose in the first place?
In 2005-2006 it were investors(same people who also invest in startup companies who saw a
loophole for easy and quick money. Many people realized that the prices in real estate just
kept rising, so people developed a strategy of very short term transactions. This meant that
people bought and sold their assets after the prices eventually, and as expected, rose. This
was a strategy that was used all over the country. In general terms this could be described as
extrapolation of the prices. They thought that prices would rise forever and there wouldnt
come an end to it, this meant that they made their assumptions of the future prices by looking
at the trends that took place in the past and neglected looking at the future. So if the prices
over the last month rose with 2 % they would assume this would be the same for the next
month.
Of course this trend couldnt go on for long and the prices started to fall dramatically.
According to Nicolas Barberis the causes for these sudden declines in prices were thanks to
institutional and psychological problems. The institutional causes of the financial crises were
easy to spot after the crisis, but it were the psychological issues that were the most
interesting to research. Many theorists describe these psychological issues as manipulation
of the belief of the people; e.g. for this is for instance the phenomena cognitive dissonance.
In order to understand the link between the financial crisis of 2008 and the tech startups. It is
important to understand how the financial market works and knowing how the people
involved in it I think. Because honestly, there isnt much difference between the people
investing in real estate and those investing in tech startups. Their markets are all found in the
public market as in the private market as well.

Startup bubble
A few years later the market has grown out of the financial crisis and finds itself back in a
rising trend. For startup companies this is a great opportunity. The mindset of the investors is
again pro risk, which makes sure that a lot of money flows into private and public equity. But
today it seems that some people still are a bit skeptical about the current financial trend,
because the private sector of the tech companies is rising to fast. A lot of people talk about a
new bubble coming up with the same characteristics of the dotcom bubble of 2001.
4 potential startup companies

Rodrigo Verschraegen, Olivier Elewaut & Heline Jaf

In this section we will discuss 4 potential startup companies that at the moment are looking
for investors and business partners to expand their business.

ZERVANT
The first company we wish to introduce is ZERVANT, which is a startup company that is
specialized in helping small businesses with their accounting. They have created an online
invoicing and accounting software that should help small businesses with the allocation of
their duties. Al companies big or small have to do their accounting, but for small companies
who dont have that much people working. It might take up to much of their time, that they
otherwise would invest in increasing their productivity.
For that reason, ZERVANT created their product to help these undermanned small
businesses. They have found a way to the point that it becomes very easy for small
businesses to book their invoices and incorporating it directly into their ledgers. They even
have expanded their product with a time tracker, where it is easier to track the amount of time
people spend on a certain project in order to make the invoicing of their services more
efficient.
The other aspect that makes this site so interesting is their pricing. On their website they
have presented a very structured overview of the pricing of their services.
For an exact overview visit their website: https://www.zervant.com/en/index.php

TEICOS Pharma
Our second company we want to present is TEICOS Pharma, which is specialized in the
pharmaceutical industry. They have come up with a new way to inject any drug into the body,
but not through the use of needles or pills. They came up with a formula to transfer any drug
into a gas and making it possible for patients to inhale it. This way it will come into the
circular system of the body through the longs, because after all, all blood cells contain air.
The ones who can profit the most of this are the hospitals who can always profit from new
ways to inject their patients. At the moment TEICOS Pharma is looking at any potential
business partners and other investors. They have placed ads on all sort of venture capital,
crowdfunding and angel investor profile websites to find the capital and the needed
connections to grow further.
Maybe this company might present an opportunity for smaller hospitals to invest in this new
technology while the company still doesnt have the demand they need to increase their
prices.
Further info can be found on their website: http://www.teicospharma.com/

Biz Chatbox
Our third company will be BIZ Chatbox, which is specialized in the HM department for a
company and to be more specific, the customer service. Many small companies of today
dont have the means to get the right feedback from their customers that big corporations
have. Therefor Biz Chatbox came up with a digital product that would make it possible for the
smaller companies to gain the feedback they need to improve their services.
Their product is a multifunctional API that can be integrated into the website from any small
business that wishes direct interactivity with their customers. In the API is a live chat session
integrated, where it is possible for customers to get directly in contact with the customer
support department of the company. Also other characteristics are included in the API. One
other example is the integration of an email managing system for your feedback.
The best part of this new product is that it is completely free and easily applied on your
website. For more information on this product check the promotional video of the company
that can be viewed on their website: http://www.bizchatbox.com/FreeHelpDesk .

LUXEXCEL
The last company presented in this report will be LUXEXCEL, which is specialized in printing
complete products in 3D. According to many sources they were the first to actually print an
entire product with the use of 3D printing. Normally many 3D printing companies print
different parts separately and add them together when everything is done.

Rodrigo Verschraegen, Olivier Elewaut & Heline Jaf

Its a company created in 2009 and is therefore a bit more mature than the ones above But it
can be seen as a clear example on what the impact of any successful startup may be. Now
they are even still a growing company and are present in different kind of industries:
eyewear, photonics, auto industry, lightning and even aerospace. Even now they state that
LUXEXCEL will keep on growing into other industries.
For more information their promotional video can be seen on their main website:
https://www.luxexcel.com/
tech startup creation
as already stated before the startup market has boomed enormously the past 5 years. So if
we wish to know more about this recent development. We need to answer ourselves the
question of how these startups were able to come up at this enormous rate.
The first reason for this big increase is the way money can be poured into these startups. It
has already been mentioned before, but this process is called venture capital. Basically it
describes the process where startup companies present their business plan to potential
investors in the hope they would invest; in exchange for a certain amount of stocks of the
company. Besides that, people name it venture capital, because it bears somewhat more risk
than any other investment.
Nowadays there are many venture capitalist all looking at the next Facebook. Which makes
sure that when someone presents their startup company with a potential for success, it
receives the right amount of attention. This brings me to the second reason, networking.
For many entrepreneurs networking has been standing on the top of their list. Without it, it is
almost impossible to maintain.
But to be honest it are startup companies that made it easier and more profitable for
companies to network. This is because the main moto of startups is innovation and that is
exactly what they did with networking. We dont even need to look hard to see for evidence.
The company LinkedIn that everyone knows and uses as the Facebook for the corporate
world, was founded as a startup company. In 2002 they were founded and went through their
first venture round, ending up with an investment from Sequoia Capital. LinkedIn truly is one
of many other startups that changed the way to do business for everyone. So not only the big
companies, and the smaller ones, but also the individual gained an opportunity to increase
their networking capabilities.
Another reason why the rise of future startups wont drop anytime soon is the entrepreneurial
mindset that keeps on growing. More and more people wish to be part of a company from the
very beginning and changing It into a successful self-sufficient business. As a result it is
silicon valley who beats Wall street in the recruitment process of the best and brightest
employees.
Throughout history there were created many startups that changed our society completely.
Down below you will find a list of some of these companies that placed our world upside
down:

Facebook
LinkedIn
PayPal
EBay

Alibaba
Microsoft
google

Rodrigo Verschraegen, Olivier Elewaut & Heline Jaf

All of the above companies ones started as a tech startup, but changed the way to do
business for all stakeholders drastically.

Conclusion
Out of this report we can conclude that not only small businesses need to keep an eye on the
rising startups of tomorrow, but everyone can profit from these businesses. But the real
problem here is: how to recognize the opportunities when they arrive? Now only the
investors and other big players have the right means to be up to date with the startups of
tomorrow, but there needs to be more transparency. Startups need to be able to present
themselves to their potential clients in a more open way. This way both sides can profit from
each other. The startups can find it easier to reach their customers, as mentioned above, and
the small business of today can find the right startup to outsource their services to.
So, how could the traditional small businesses of today be up to date with the startups of
tomorrow?
To gain that level of transparency a globally recognized online platform must be created,
where both parties can find each other based on certain keywords they type. For example a
regular company might wish to outsource certain services like SEO, accounting, 3D
modelling, When using the advanced search engine an entire list of possible startup
companies for that particular service will appear.
But even without this transparency we can honestly say that startups can have strong
impacts on the business atmosphere for all businesses, big or small. Of course these
impacts can be for the good or the bad.

References
bizchatbox. (2015, 12 06). FreeHelpDesk. Opgehaald van bizchatbox:
http://www.bizchatbox.com/FreeHelpDesk
investopedia. (2015, 12 6). dotcom bubble. Opgehaald van investopedia:
http://www.investopedia.com/terms/d/dotcom-bubble.asp
linkedin. (2015, 12 06). linkedin. Opgehaald van linkedin:
https://ourstory.linkedin.com/
luxexcel. (2015, 12 06). luxexcel. Opgehaald van luxexcel:
https://www.luxexcel.com/
nicholasbarberis. (2015, 12 06). nicholasbarberis. Opgehaald van
faculty.soms.yale: http://faculty.som.yale.edu/nicholasbarberis/cp10.pdf
slush. (2015, 12 6). startups. Opgehaald van slush:
http://www.slush.org/attendees/startups/
teicospharma. (2015, 12 06). teicospharma. Opgehaald van teicospharma:
https://www.zervant.com/en/index.php
venturebeat. (2015, 11 21). why wall street talent is moving to silicon valley.
Opgehaald van venturebeat: http://venturebeat.com/2015/11/21/why-wallstreet-talent-is-moving-to-silicon-valley/
zervant. (2015, 12 06). API. Opgehaald van webopedia:
http://www.webopedia.com/TERM/A/API.html