'I wondered for years if I was right to leave Sydney to start a company in Cork'

AFTER FOUR YEARS, it was decision time: Cork or Sydney?

Dave McDonald was leaning towards the Rebel County, where he was planning to work as a software developer.

He first wanted to be a pilot when he was younger, but found his eyesight was too poor. He was forced to, in his own words, “fall back on the nerdy stuff”, namely his interest in computers.

McDonald left Ireland after completing a degree in UCC in 1998 and stacked shelves for a while in Australia before managing to land a good job running computers in an office.

After four years working Down Under, he had built a good life with the woman who would become his wife and had barely been back to Ireland.

However when the pair returned to McDonald’s home the second time to spend the holidays with their families, the Cork native was hit with a massive bought of homesickness.

“I was sitting in work in the office in Sydney one day, and it just hit me that I wanted to go home,” he tells Fora.

“Within 24 hours we had sold our furniture and started booking tickets, and within a few weeks we were home.

“I kept wondering if I’d made the right decision. I dreamt about Australia for three years before I settled down.”

When he returned home, McDonald was earning good money as a software developer. However he started to become more influenced by his father, Barry, who preferred to work for himself.

Moral support

His parent had set up and sold various companies including a cleaning firm and a pair of petrol stations, and served as a source of inspiration to the son.

“I watched him grow and operate and sell businesses and it gave me an entrepreneurial spirit,” says McDonald. “I saw a gap in the market for a business broadband offering with good support and service levels.”

McDonald decided he wanted to sell broadband subscriptions, but to do that he would need a network.

Nova Broadband founder David McDonald

“I set up a transmitter on an RTÉ mask in Cork City, and I went to my van on the other side of the of the city and searched the internet from a car park. It was a eureka moment,” he says.

Nova Broadband started formally trading in 2004. At the time, McDonald was mostly running the show by himself with some “financial and moral” support from his father.

He began by trying to sign up cafés in the city centre to his network, but business was slow.

“It was a few months in and we only had a handful of customers and we were struggling,” he says.

“Then Christmas came and I was on a 12 pubs (tour) in the town I used to live in, and I was introduced to an IT manager of a major multinational, Stryker.

“I told him about the network and in a month I had him as a customer and things took off. (Stryker) was the first big one and it gave me credence in the marketplace.”

Sacrifices

Although the deal gave the company a major boost, for the first year and a half Nova Broadband remained mainly a one-man show.

“It was a nightmare at times. I worked all day and all night and at the weekends, I gave everything I had to the business,” McDonald says.

“I made a lot of personal sacrifices; my social and family life took a bit of a hit but I knew I was investing in my future. Now if I take a day off I don’t feel guilty because I know I’ve earned it.”

McDonald’s father Barry recently passed away, aged just 57, after suffering a stroke. McDonald says that while the last few weeks have been “rough”, he credits his father with helping him get his business up and running.

“For the first year and a half when I was on my own he was always dipping in and helping me, it was great to have,” he says.

Barry McDonald helped set up Nova

Move out of Cork

By 2009, things finally started to come together for Nova.

“We moved into new offices and took on staff and I wasn’t on the front line then, I was able to focus on the business,” says McDonald.

Nova also made moves to expand its network. Until then, almost all of the company’s broadband customers were in Cork city and its suburbs.

“We built a new network to serve Tipperary, Kilkenny, Laois and parts of Waterford and Limerick. It was a quantum leap for us,” McDonald says.

Nova Broadband now employs a dozen people at its base in Cork, as well as a handful of contractors spread across the country. McDonald says that the firm is on course to turn over €2 million this year, up a third on 2016, and is profitable.

The company has moved into the residential broadband market and has now split its business into two brands. Nova Broadband is its residential arm, while business customers deal with Nova Telecom.

As well as operating in its own system, Nova can access many parts of the country by using the network of other operators, such as Eir.

“We make more margins on our own network because we don’t pay for wholesale, but the price remains the same for the customer,” McDonald says.

“(Residential customers) pay between €26.99 and €56.99 a month depending on if you’re a light or a heavy user, and there’s no line rental charge.

“(Prices for business customers) can start at €36.99 for a basic connection, but we have businesses that are paying €15,000 per annum with 24/7 tech support.”

Expansion

Nova has “a few thousand customers”, with the share fairly evenly split between commercial and residential customers users – although the company makes more money from the businesses.

Most of its residential customers are based in Cork and Tipperary; the firm targets rural or suburban areas that are typically poorly served by bigger operators.

The Nova Broadband logo

On the business side, most of its consumers are based in Cork, however the company has plans to open a Dublin office this year.

“Cork has been our home for a long time, but it’s time to spread our wings,” McDonald says.

“We will make about eight hires between now and next year. There might be six in Dublin and two in Cork, we’re trying to diversify.”

The way McDonald sees it, the Irish broadband market is divided in two: Eir, and everyone else.

“There is a place for all the others. Any place that is dependant on internet needs two different suppliers in case one provider ever has an outage,” he says.

“Among the alternative internet providers, we would be trying to get a foothold in that market with the likes of Magnet and Viatel.”

McDonald says that the firm has several advantages over rival ‘alternative providers’, such as the fact that it has its own network.

“Customers deal with us by phone and we know them by name. We provide integrated billing, 24/7 support and we have our own network and partner network,” he says.

Peddling faster

While Nova is still looking to win more residential customers, McDonald says that the growing the firm’s business base is the primary focus.

“We want to keep rolling out our own network and service as many business parks and offices as we can,” he says.

“In five years, I would like Nova Telecom to be one of the names that would come to people’s minds naturally when they are shopping for business broadband.”

While McDonald now realises the value of a good work-life balance, he doesn’t have plans to slow down anytime soon.

“I used to think that I would work until I dropped in the fields. I now value a work-life balance more, but I will spend my 40s peddling faster,” he says.

“I still feel young, I don’t feel the need to kick back. I love working at Nova, and I think we’re only getting into our stride now.”

This article is part of our weekly series examining the nuts and bolts of businesses. If you would like to see your company featured please email news@fora.ie.