Terry Clune, Founder and CEO of CluneTech speaks with Sarah Freeman about his early motivations and the enduring appeal of business and innovation. Clune was Business Person of the Year at last year’s Business & Finance Awards.
I met with Terry Clune in the Stephen’s Green townhouse his company, CluneTech, inhabits. Clune, who founded Taxback.com in 1996, has parlayed his talent to create a stable of fintech companies under the CluneTech umbrella. Those companies aim to streamline processes in a range of areas including digital sales, global payroll, tax compliance, global VAT & cross-border payments. During the summer months, Clune sold one of the businesses, the Kilkenny-based, payroll software developer, Immedis, for over three hundred million euro.
Clune’s understated confidence belies the extraordinary success he’s seen. We begin by talking about education and he acknowledged that his own college career had taken rather longer that it might otherwise have, due to his extra-curricular side hustles.
“It took me six years to get through four years of college. Part of the way through the course, which I really enjoyed, I started to run discos on South Anne Street. I used to rent McGonagle’s every Thursday for an event called Wipeout.”
His time as a nightclub impresario was interrupted by a year on Erasmus in Holland.
“I’ll tell you what, I didn’t really show up as much as I should have. I spent most of my time across the border in Cologne, Germany. I started a business while I was there.”
Rewinding a little bit, I ask Clune where this entrepreneurial spirit came from. Were there signs of it from an early age?
Clune recounts how, at the age of 8, living in Wicklow with his mother, a teacher, and farmer father, he was encouraged to start a business of collecting fertiliser bags from neighbouring farmers.
“I used to wrap the fertiliser bags up into bags of twenty and sell them to wood merchants. who used them to sell firewood in petrol stations. Traditionally, farmers would have burned them in the corner of a field.”
“It was a phenomenal opportunity because I used to get a pound for a bag of 20. I was an eight year old, and it enabled me to be able to buy a BMX bike, which was a very cool thing, and I was able to cycle around to my farmer customers every weekend. Breakfast for me on Saturdays was Snickers bars and Mars bars and I’d bring some bars for the farmers.”
The endeavour thrived until a rival seven year old saw what Clune was doing and put him out of business.
“My business went bust because he came along with a better bag. A clear, see-through bag that was much more useful to wood merchants as their customers could see how much timber was in it.”
Clune says this was a tremendous life and business lesson for him.
“The second you start to forget why you’re there in terms of what you’re providing … You need to continuously improve your products. I was getting a bit lazy on my bike and just eating chocolate bars. This other guy saw an opportunity.”
New Business Ideas
According to Clune, it’s not all that difficult to conjure up new business ideas.
“There’s always an opportunity. You don’t have to be developing the best, latest idea to find a business.”
He points to a notebook on the table in front of us.
“You have a notebook there. Is there a way to make that notebook better? You need to have an interest, a hunger, a desire to make it better. In virtually every product you look at, there’s a way to make it better. And that’s where the business is.
“A lot of people look at entrepreneurs and say, God, I’d love to be able to come up with ideas. There are millions of ideas staring people in the face all the time. It’s just really having the gumption and the hunger, I suppose, to bother.”
He recalls the disastrous cup of tea he had that morning.
“I poured from the teapot and the tea poured all over the place. Who is making teapots? I would nearly want to go into the business of making a better teapot because I just know I’d sell much more because I wouldn’t have annoyed customers. There’s business in everything.”
Clune encourages people to look at the everyday products they use, to evaluate the basic functions of pedestrian, ordinary things and how they might be improved.
“With all the tech innovation, like Open AI and Chat GPT, people think entrepreneurs need to just focus on that. But can you make a better case for the phone? I have a thing that holds my phone and credit cards and they are always falling out. It’s about spotting if there is a better way to do something and then having the determination to do it.”
He’s not embracing the teapot idea just yet. He has other ideas to execute and other companies to start.
“There are actually bigger opportunities that we see all the time in FinTech and in business services. We see the openings because our team experiences the glitches. We then think there’s a better way to do that actually and that’s how every company in our group has emerged.”
Entrepreneurship
Speaking in general terms about the idea of entrepreneurship, Clune encourages those with ideas to come together and work as a unit.
“When most people think of entrepreneurship, it’s someone on their own, in a very lonely position having to deal with all of the success or failure that comes along. It’s better to have a team with different people of different strengths.
Clune says there has been huge growth of investment capital in Ireland over the last five years from both the leading banks and a variety of funds.
“Copying the American model when you have smart people, innovative ideas and money, you can do an awful lot together to build a great business. I think we’ve got a lot of good stuff going here.”
Clune has had extraordinary success. Has he ever experienced failure?
“In 2004, my business (Taxback.com) was only really getting started and we were focused on the US. We had customers who had worked there and we were helping them to get their tax back. With a month’s notice, we heard that the government was closing down a particular tax law, which meant that our entire business was going to be wiped out, shut down and non-existent.”
He was in his early twenties with around 20 employees when he received this news.
“It was like the ground opened. You’re responsible for so many people and you feel that responsibility. So it was a calamity waiting to happen.
What was his solution?
“We flew to Australia, saw that there was an opportunity there for doing something very similar and so rather than waiting to be hit by the bus, we developed a whole new market there, which was much, much bigger for us as a business.”
Clune says if that solution hadn’t been available to them, they would have failed.
“I used to hear this term fail fast, and I kind of know now what it means. Figure out if it’s going to work and if so, phenomenal. If it’s not going to work, shut it down or figure out if there’s an alternative route. Learn as quickly as you can that it’s not going to work. And that’s really about not wasting money, not dwelling on something, not pumping, pumping, pumping money into stuff until flogging a dead horse that’s not actually going to work.”
This, says Clune, is key to success. Developing an ability to be resilient.
“It’s probably the most important skill.”
He tells a story from his early twenties when, dreadlocked and shod in Doc Marten boots to the knee and a trench coat, his fledgling German business almost met with disaster when the students he had brought to the canning factory needed their tax rebate.
“I was worked like a dog by all of the students who were demanding absolutely everything from me and I’d spent all the money I’d earned on phone bills and taxis taking students back from hospitals in taxis from overindulgence in alcohol. During the year they’d all paid a lot of money in taxes, about 50 percent tax, and I just casually said to them along the way, don’t worry about that, we’ll, we’ll be able to get that back for you.”
On arrival at the relevant German administrative office, he was told the students were not due any tax back. So he brought them all to another office.
“Myself and 120 students all got on the train, like the Pied Piper.”
He was met with the same response. He was getting the lift back downstairs, wondering what to say to the students, when an employee saw the Guinness bag he was carrying with the tax documents belonging to all the students. Luckily for Clune, he had caught the attention of the Director of the Tax Office who had just returned from a cycling holiday in Cork and Kerry. ‘I love your country’ he said to Clune and that was that. He helped them resolve the issue and all of the students received their tax rebate.
“I had some inkling the students were due a rebate but didn’t have a clue how to go about it. The point is resilience. If you don’t give up, it’s not that you can’t lose but you’re much more likely to win.”
Advice for budding entrepreneurs
The father of five says it’s harder to take chances when you have responsibilities but gives a few key pointers for those keen to start their own business:
“If you have an idea, don’t give up your day job, that’s absolute madness. Find a few other people to create a team with e.g. a finance person comes first, a techie person, etc. Keep overheads low and start the business from the back bedroom. Have the mindset to save money, for example buy a second hand laptop and phone. Keep your day job but work nights, work extremely hard.”
Clune advocates waiting before approaching investors.
“Create a little bit of cash flow first. The best angle is to get the business up and running and then they go and meet investors because investors want to give people money, they want to have people over a barrel. So if the company is in its infancy, they will ask for 90% of the company because obviously they don’t want to take on all the risk of giving out this money. Whereas if you have your business at least slightly up and running, then you don’t have to give away as much of your business.”
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