POS Sector shows how important it is to carve a clear niche for your startup [Interview]

A lot of startups today work on basically the same principle; you have a Web service and maybe a mobile application that is somehow connected to that core service and that’s it. Most of them are trying to improve something about your business, but it’s sad that many of those projects are focused on Web and social media.

There should be more niche startups, like Seedcamp Week graduate Farmeron, which is an online social dashboard for farmers, or POS Sector.

Lunacom.ba is the company behind POS Sector. It started as a small IT consulting company, founded way back in 2002. It was a typical IT company in the South Eastern Europe (SEE) region – IT consulting and Web design based on their own proprietary CMS. As Haris Čusto, CTO, explained, the main problem was that companies back then didn’t know how to make money from websites, or to be more precise, how to get a good return from that investment. Luna dumped the website building business and eventually, after several accounting applications, ended up creating its first point-of-sale software in 2007. POS Sector was born.

TNW: Your core product is POS Sector. What is it? Who and where is your target market?

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HARIS ČUSTO: POS Sector is point of sale software for restaurant and bars. It was the first touch screen POS application in the SEE region and it had a wonderful interface. Because our companies were founded in Bosnia and Herzegovina and Croatia, we introduced POS Sector there first. Later, through our new reseller program, we were able to acquire large POS resellers as our partners and were able to offer POS Sector in Serbia and Montenegro.

You see, there is something to it – find a niche and specialize in it! Location based games are great and full of fun, but do you want to spend your time and money building something that already exists?

Haris further explained how lucky they were – they were pretty unique in their field. Every restaurant and every bar had the same old DOS-based software. It was a strange feeling for them, Haris says, to find out that your application might be the best one out there.

HARIS ČUSTO: Since the beginning, every few months we would check our competition to see what was new and what was happening on the POS market and from the first day we started, we had a strange feeling; there was no good POS software out there that could use the possibilities of current technologies.

We suppressed that [strange] feeling and big ambitions, and continued to work for the local market (basically Ex-Yugoslavia). But as the years passed by, the crazy feeling didn’t go away. And from 2007 – 2010 we got about 500 clients (restaurants and bars) who are using our application on a regular basis. In the last 10 months alone, we were able acquire 200 new customers. We thought, those were strong signs for a growing demand of our software.

For almost a year, the team has been working on POS Sommelier, point-of-sale software for restaurant and bars which was designed from the scratch for end users who wanted to manage everything alone, without expensive support packages. POS Sommelier is Luna’s attempt to take on a global market.

HARIS ČUSTO: It offers restaurant owners a way to manage their restaurants and bars via our website with a smartphone and read daily and monthly reports from on the way and everywhere. They are not constrained to their restaurants anymore and can monitor revenues wherever they go, while they are doing business.

To the customers POS Sommelier offers additional benefits such as reservation of tables and an online order system through a website. Our company combined all this into an innovative and intuitive to use interface.

The South Eastern Europe startup scene

I talked with Haris about the SEE startup scene as well:

HARIS ČUSTO: The SEE startup scene rocks right now. Our biggest problem is the lack of communications between startups and startup founders (which is not strange, since, unlike Silicon Valley, we are not centralized), but one of our biggest advantage are the smart people living here.

I heard that in Silicon Valley they are looking for developers and designers, and here we have a problem employing all the great talents. I think there is a lot of potential.

Of course, there are some things in the region that must be changed.

HARIS ČUSTO: Well, for the start – since our talents are not centralized like Silicon Valley and not everyone can spend the time or money to go to conferences for advice from successful startup founders nor is there a network for serial entrepreneurs, we should create a central website where entrepreneurs can talk to each other and exchange ideas and also to get advice from other founders who are dealing with similar problems.

That website might become a part of the Netokracija, since there are a lot of people who have experience in the different phases of a startup life cycle.

The POS Sector story shows the benefit of seeking out something that hasn’t been covered yet. Look for things that can be made better by using IT and stick to that. That way, you’ll find clients, maybe investors (if you need them) and you can rule the market. Copying ideas and applications won’t get you anywhere.