Talent, innovation, and cash are not the only keys to building a business

For years, friends Derek Billingsley, Jeff Furlong, and Sean Higgins talked about starting a business together. The talk turned serious in 2007 when discussing IPTV, a technology that telephone companies use to offer to television-services customers. Today the trio runs Encore Interactive, providing telephone and cable companies with home personal video software. "I've been an entrepreneur my whole life," says Billingsley, 38, the vice-president of business development at Encore. "R&D levels the playing field for smaller businesses and allows us to create and lead this new market, even outpace the big multinationals."

Encore's flagship product is Encore Media Gateway, which allows people to bring video, music, and photos anywhere in their home via television, computers, and portable devices. "It's whole-home entertainment," says Billingsley. Encore sells the software to telephone companies which then offer it to customers affordably. Ultimately the product helps telephone companies offer the next generation of services while also differentiating them from what's being offered by traditional cable-television providers.

To develop the software, Encore invested more than $1 million in R&D. "We're an emerging business," says Billingsley, "so we've funded our R&D with cash flow from consulting services to pay for salaries and build the prototypes for the business." The company also credits the help of the National Research Council and ACOA and hopes to have its first deal with a major telephone company signed this fall. Its goal is to have seven major telecommunications companies signed by 2011.

To minimize the risks and maximize sales and marketing potential, Encore formed a strategic partnership with Mariner Partners Inc., a Saint John-based IT firm that also specializes in IPTV. They are sharing resources to offer a combined solution to telecommunication and media companies. "We're a small and nimble company that doubled its impact through the partnership," says Billingsley. "There is a synergy in terms of skills and products that forms the basis of our partnership."

To continue growing, more financing is needed. "We went to an industry trade show in California last year and had the opportunity to demo to a lot of potential clients and partners," says Billingsley. "The product was so well received that people wanted to buy it on the spot. That's when we knew we wanted to get beyond self-financing. We needed support."

The company is now negotiating a significant deal with a venture capital firm to help finance further innovation and its first wave of sales. Billingsley admits that finding financing in New Brunswick has been difficult. "There are not a lot of sources available for small businesses. So we network all the time, telling our story to everyone, which is crucial to securing the right investors."

Talent, says Billingsley, is a business's best investment. Encore's 12 full-time staff holds a total of 25 patents. "We have smart people who pick up things quick and are constantly working on developing cool technology. They have a spring of endless enthusiasm, and that's essential to our innovation."