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SimplySocial entrepreneurs test-marketing in Alaska

Posted: June 24, 2012 - 10:19pm

Alaska technology entrepreneur Tyler Arnold and two partners based in Europe have formed a new company, SimplySocial, and rolled out new software that helps businesses more easily use social media sites like Facebook, Twitter and YouTube for marketing.

The software could also help political candidates and elected officials reach voters and constituents.

“Our goal is do for social media what AOL did for e-mail in the 1990s,” Arnold said. “Remember ‘you’ve got mail’?”

Turbotax, for filing tax returns, is another example.

“There are complexities in using social media sites and our goal basically is to make it simple for people who are busy,” Arnold said. “The concept is a software for people who want to use social media in marketing but don’t know how.”

Anchorage was selected to test the new SimplySocial software partly because Arnold is from the city and has established clients through his own company, Tyler Systems, and because the relative small size of the community allows good feedback from potential customers who are trying out the software being made available for test-runs at no charge, Arnold said.

“This is where I was born and raised, and it’s where our investors are and our network. While the Alaskan market may be small, we know that if we can make it work here we can make it work anywhere,” Arnold said.

Larger cities in the U.S. also have plenty of advertising and public relations agencies which specialize in use of social media, making for a more competitive environment. Arnold isn’t afraid of the competition because SimplySocial’s new tool is still unique, but competition would create noise in the marketing environment and make it more difficult to get potential customers to try out the software.

“There are a lot of social media agencies in the Lower 48 using a lot of social media tools. Our advantage is in combining the tools,” Arnold’s partner, Jeroen Erne said.

Anchorage simply offers a better environment for test marketing, he said.

Erne is from the Netherlands, and the third partner, Valetin Bora, is from Romania. Erne and Bora are tech-savvy 20-somethings, and Arnold himself is 19.

The company’s formation and startup is classic Entrepreneurship 101.Allan Johnston, a long-time Anchorage financial advisor, has been mentoring Arnold in business and finance since Tyler Systems was formed when Arnold was 17.

Johnston likes to work with young entrepreneurs, and said he was pleasantly surprised in getting an e-mail from Arnold asking for help.

“I was only 16 when I met Allan,” Arnold said. “I had no knowledge of business or finance, but after we met I presented a business plan to him for Tyler Systems.”

Arnold doesn’t consider himself a tech-wizard, and feels more adept at marketing and management. After starting Tyler Systems he quickly learned how to find resources through freelance networks on the internet, and soon the new firm had 80 clients, with 30 of them “core” clients asking for continuing support.

Some of these were local but many were outside Alaska, proving the point that the internet enables technology and creative services to be done anywhere, Arnold said.

Alaska’s time differences from the continental U.S. and Europe can even be an advantage, he said.

Later, when Arnold presented the idea of SimplySocial and its software to Johnston, the financial advisor found eight other local “angel” investors, along with himself, to provide start-up financing.

Euro trip

Arnold’s European connections grew quickly. He met Erne on-line and initially the two worked together via the internet in support of Tyler Systems’ clients, mostly local advertising agencies and firms needing assistance in web page design and development. As the needs grew, Erne brought Bora, from Romania, into the group for his technical skills.Erne and Bora had worked together on projects for Erne’s clients in Europe.

Erne had started his own firm, Joy Group, in 2008, in his home city of Almere, near Amsterdam. He has since sold the company to focus on developing Simply Social.

Bora lives and works in Timisoara, which is in western Romania and is actually closer to Budapest, Hungary’s capital, than Bucharest, the Romanian capital. Bora has worked as an IT consultant for several years in Romania. Timisoara has become an IT center for the emerging eastern European nation, and is attracting young, tech-adept people like Bora, Arnold said.

Bora, Erne and Arnold worked together over the internet and met face-to-face, in Europe, in 2010 for the first time. With all three finally together in person Arnold pitched the concept of the SimplySocial software, the three working together to develop it and also forming a company.

Erne and Bora signed on.

After an extensive period for the three working together in Romania on technical development in late 2011 and early 2012, Erne and Arnold flew back to Alaska for the launch. Bora was supposed to come along, but a visa glitch caused his first U.S. trip to be delayed.

Since the product roll-out there have already been surprises from potential customers. They were pleasant surprises, Arnold said, but different than what had been expected. These have caused some adjustments in the marketing plan, he said.

The surprise was the response from larger firms and institutions who asked SimplySocial to develop adaptations of the program for their current systems. “We’re meeting our expectations, but in a different way than we had anticipated,” Armold said. “We expect to hit our year-end revenue goals but with fewer customers.”

Many potential larger-clients are asking for hands-on help, to the point that the three are so busy that the marketing push to small firms will have to wait. Working with political candidates, potentially a lucrative niche, has also been pushed off into the future.

In an interview, Erne said he believes this is actually good because it will enable the company to develop and test a version of its product fine-tuned for small firms and institutions, and small political campaigns like contests for legislative offices.

Meanwhile, Arnold and his partners demonstrated the software’s use in lobbying by using the SimplySocial tools, even in their early form, earlier this to muster grassroots support in helping Rep. Mia Costello, R-Anchorage, get her House Bill 252 passed through the House and Senate.

The bill, now signed into law by Gov. Sean Parnell, exempts start-up technology firms, like SimplySocial, from state corporate income taxes until a company’s assets reach a certain level.

Erne sees great potential for the software in Europe once it is tested and accepted in the U.S., and said he U.S. is an easier place to prove products like SimplySocial’s software.

“Europe is a bit behind the U.S. in the use of social media tools,” Erne said.

There is a difference in business culture, too.

“In my home country, Holland, customers would want to see more track-record for a product before even trying it. In the American market people are more willing to take a chance with something new,” he said.

If the product succeeds in the U.S. – after its market tests in Alaska – Europe will be ready for it, he said.

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