Layton Duncan, Polar Bear Farm

December 12, 2011

This is the next post in the Founder Centric Startups series.

Layton Duncan is the co-founder of Polar Bear Farm, based in Christchurch.

Through good timing and amazing foresight he managed to position himself in front of a massive emerging wave, as the developer of the very first paid native iPhone app, even before Apple officially allowed apps like this to be developed.

However it hasn’t been all smooth sailing.

A successful company with a single founder is rare, so usually the advice for founders is to find other like minded people to work with you on your venture. However, this doesn’t always work out the way that you’d hope, and unless it’s managed carefully the relationship between founders can end up tearing a company apart.

_This is something that Layton has had to deal with, and I appreciate his honesty in describing the effect this has had on the venture. _

I’ll let him take up the story right from the beginning:

What’s the purpose of your company?

To create mobile software to help people to get their job done efficiently.

What does your company do?

We create productivity software for the iPhone, iPad, and iPod Touch, enabling business to exploit the massive productivity benefits brought by the mobile revolution. Our core product is a rapid application development platform called Air Forms. It allows business to create native looking and feeling iPad and iPhone interfaces into their existing database systems, without having to worry about custom app development, or coding. Interfaces are created and wired to databases through a GUI based builder tool, and can be distributed across a large number of iOS devices, all without writing a line of code.

What is the business model?

Primarily licenses from software sales, with a minor recurring subscription fees on some services which require hosted backend services.

How do potential customers learn about you?

Primarily through the iTunes App Store, although some products via Business Managers at Apple Retail Stores, external consultancy companies who create and sell solutions based on our platform, and finally cross promotion of products through existing customer contact, and occasional online advertising.

How many customers do you have?

Several million combined across free and paid versions of our products.

Who are the people working with you on this?

I founded the company, and got a long time friend on as co-founder shortly after, but parted ways around a year in. The company has been up and down over the past four years up to five employees now down to two, constrained mainly by the ability to find quality employees.

How did the business get started?

From the announcement of the first iPhone at the beginning of 2007, it seemed immediately obvious to me that there would be huge potential for 3rd party software for the iPhone. It was so radically different, the interface so rich, the device so powerful that it seemed inevitable. Apple wasn’t at all interested in real 3rd party apps initially. Their ‘sweet solution’ for developers, announced just before the device was to ship, was a ‘nice’ but ultimately limiting web application solution. As soon as the iPhone was released in the US, I got one shipped over, unlocked it and got it running on a cell network here. Around that time, there were a handful of people working on creating the tool-chains (cross compiler, and associated tools) so that they could start coding and building native applications for this device, given Apple were not providing any official native development tools. Pretty soon the app which Apple’s App Store was later to be modelled off, called “Installer”, was released. This offered a central repository for all the unofficial native iPhone apps that were starting to pop up, there were no payment mechanisms and it was primarily filled with experimental apps from hackers, trying to reverse engineer the frameworks.

Frustrated with the total lack of search functionality on the original iPhone, over the space of a weekend I wrote a utility called ‘Search’ which let users search contacts, calendar events, emails, SMS etc, and posted it on a forum, with a $10 license fee. Within hours the money started rolling in. It was the very first paid native iPhone app in the world, and it took off fast! We decided to fly to San Francisco to exhibit what I was building at Macworld Expo.

It was almost a year after we started that Apple open the iTunes App Store, opening up the iPhone for official 3rd party development. Looking back, it seemed kind of crazy starting a company creating software for a device that pundits said was far too expensive and would be a flop, which you couldn’t even officially build software for, then selling that software to people who couldn’t officially install it on their iPhones, and had to jump through ridiculous hoops to then pay for it.

How have you funded your growth so far?

Totally bootstrapped. The company was profitable virtually immediately after a weekends worth of development. I had a software consultancy business through university, and Polar Bear Farm was founded a year after I had graduated.

What are the mistakes you’ve made?

The most significant mistake was very early on, before the company was incorporated.

Shortly after releasing our first app, and seeing the immediate and accelerating success, I had asked a friend to come on board to help try and build a real company. I had been through school with him since the age of 7, and he was one of those people with the gift of the gab, a person who’d be great in sales and promotion. Being an engineer, but with a business bent, I was interested in branding and promotion to some extent, but I was far more interesting in building products. However, I failed to be rational in valuing what I was bringing to the newly formed company, (an existing product with real cash flow, unique development knowledge etc) vs what he was bringing in skills. So the company was formed with 50:50 shareholding.

Less than a year down the track, after some pretty frank discussions on the reason I brought him on board in the first place, and the direction of the company, he decided he wanted to do other things. We had a shareholders agreement from the outset, which made clear what was to happen in this situation. That made things easier in that everyone knew how it was to work. But it was then that I realised I’d really made a serious mistake initially in valuing contributions as 50:50. I think I justified it to myself at the time as ‘in the scheme of things, the future potential is so huge that the extra value I was bringing initially would be insignificant in the long run’. That was totally wrong, it’s the here and now that matters, not speculation on what might be.

When the split happened, it almost destroyed the company.

What are the biggest challenges you’ve faced so far?

First dealing with the aftermath of the split. Financially it basically reset the company to square one, which was tough. It also destroyed a long standing friendship - I don’t think we’ve spoken since the day I handed him the bank cheque to buy him out three years ago.

Then of course mother nature has smacked us all around here in Christchurch. It’s still hard to believe it even happened, still living with the realities of unsettled insurance claims, a make shift office, and the city that I had built a working environment that I loved, totally destroyed, and most tragically of all, a long time business friend killed in the CTV building collapse. It all tends to put other things on hold, or at least into slow motion.

Right now, the biggest challenge is finding quality employees who don’t necessarily have direct experience in iOS development, but who have ‘Apple DNA’ (for lack of a better description). Then, once I find them, convincing them Christchurch is the place to be!

What’s your ambition for the company?

To create products of significant value to people that are the highest quality and totally ubiquitous in their class world over.

What advice do you have for other founders?

If you’re considering bringing co-founder(s) on board, read this:

If you don’t feel exactly that way about those people you’re considering, don’t do it. Got even the slightest hesitation? Don’t go there.

If you don’t have the right people in the team that can cripple your company. As painful as it may be, as soon as you realise it’s not working you need to cut them out and move on as fast as possible.

Intuition is important, don’t suppress it. If you feel something’s not right, tackle it head on. If you feel something is right, pursue it. I think intuition is the brain’s subconscious pattern matcher at play, pulling on all your past experience to trying to answer questions your conscious struggles with. Well that’s my theory anyway. Just roll with it, if it turns out you’re wrong, then you’ll learn something, which just improves your intuition.

Like all work, make sure you enjoy the ride. The final destination in startup life is an ever moving target, the highs are high, the lows can be low, just try to create more highs than lows.

Hunt out diversity. Great engineers are creative, and have diverse interests.

Always be honest, both to yourself, and others.

Play nice. Karma’s a bitch.

Other guest posts in this series: