So Many Things Have To Go Right, It'll Probably Never Happen

By John Giles, president, Future POS

When I became an ISV a little over 19 years ago, it was an exciting time to be in point of sale. DOS was starting to give way to Windows, creating many opportunities for clever guys like myself. I had realized several years earlier this shift would occur and used it to my advantage, creating a fully Windows-based POS before most companies had embraced the fact Windows wasn’t going away. Because the traditional competitors who had comprehensive DOS products had to essentially start from scratch, a level playing field was created in which a one-man operation had a fighting chance against established players.

Back then, Future POS was very grass roots. I’d get in my car and drive in bigger and bigger circles around my hometown recruiting dealers, demoing the software for them on my one and only laptop. A few years into our VAR recruitment efforts, I connected with a brilliant businessman by the name of Alan Hayman.

At the time, we would sign up just about anyone with a pulse, and the one-man-working-out-of-his-garage VAR was certainly not beneath us. Alan’s thoughts on the topic were simple, yet profound: “For that one-man operation to grow into a large and successful VAR so many things have to go right, it’ll probably never happen.”

I have never forgotten these words.

Think about it. You’re watching your favorite football team, it’s late in the fourth quarter, and you’re down by eleven. Every die-hard fan is thinking, “OK, quick touchdown, two-point conversion, onside kick, field goal, and we can win in overtime.”

In your heart you see a path to victory because you don’t want to give up. But the reality is you need four separate, low-percentage events to occur back-to-back. Deep down you know, “So many things have to go right, it’ll probably never happen.”

Fast forward to the new tablet POS startups, and history seems to be repeating itself. Android and iOS are brave new worlds most traditional POS companies haven’t embraced, and they are very much suitable for running POS applications. Many of these companies (over 200 at last count) have been handed stacks of cash to get started. But I put myself in their position and ask, “If I had $50 million, could I hand assemble a team that would be guaranteed to dominate the industry?” Simply put, the answer is no, and I know a lot more about the POS business than someone who is just getting into it.

So take a minute to reflect on these POS app startups. They’re called unicorns for a reason. Will they hire the right talent? Will people get greedy and demand raises or quit? Will they get sued because their stuff just doesn’t work as advertised? Will there be petty in-fighting in the newly assembled dream team? And, most importantly, does that startup’s management have the skills to take a “three geeks in a dorm room” company global?

To quote my good friend Alan one last time, “So many things have to go right, it’ll probably never happen.” Sure, some of these companies will survive — my guess is somewhere between 3 and 5 percent of those more than 200 companies will be in business in five years.

So for a VAR or consumer thinking about a new tablet POS system, you have to ask yourself, “Am I sure I can find the prince among all those toads?” I can tell you for sure picking the wrong one will be crippling to your business. That may be a risk some people are willing to take, but me, I don’t bet on anything unless I have very significant control of the outcome.

You may be saying to yourself, “That John Giles seems like a really negative guy.” Nothing could be further from the truth. My job title may be President, but my primary responsibility is to be the Devil’s Advocate.

I have to worst case every situation, looking at every angle to avoid the pitfalls that happen when you believe what you want to believe instead of what the facts and numbers are telling you. It’s what’s kept me in business for nearly two decades and made Future POS a top five hospitality POS product. I’m a glass-is-half-full kind of guy and in every challenge I look for the opportunity. When I see private equity startups claiming unrealistic numbers with no mention of attrition or making ludicrous statements that just don’t jive with reality — a business reality I know far better than most people — I have to point out that it will probably never happen.