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Lauren Hasegawa, left, and Mallorie Brodie, the founders of Bridgit, created a smartphone app that tracks construction defects for builders. Now they are wondering whether they should go for broke and create a similar app for consumers. (Glenn Lowson For The Globe and Mail)
Lauren Hasegawa, left, and Mallorie Brodie, the founders of Bridgit, created a smartphone app that tracks construction defects for builders. Now they are wondering whether they should go for broke and create a similar app for consumers. (Glenn Lowson For The Globe and Mail)

THE CHALLENGE

How two graduates spied a business in construction defects Add to ...

Each week, we seek out expert advice to help a small or medium-sized business overcome a key issue.

They started by driving around London, Ont., in the early mornings looking for construction sites. Mallorie Brodie and Lauren Hasegawa had a hunch the building industry was ripe for some kind of mobile innovation – they just weren’t sure what.

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The duo, who had recently graduated from the University of Western Ontario – Ms. Brodie from the Richard Ivey School of Business and Ms. Hasegawa with a bachelor’s in structural engineering – were on the prowl for a problem that needed fixing.

Construction workers “were definitely surprised to see two young girls show up on their site,” Ms. Brodie says. “But as soon as we told them what we were working on, they could see that we knew what we were talking about.”

Soon, the pair were being invited to worksite meetings.

The handling of construction defects – or “deficiency management” – kept coming up, says Ms. Hasegawa. Things like cracks in drywall, misaligned flooring and uncovered electrical sockets.

These items can cost a lot of money if they delay a project, she says. Supervisors would record the deficiencies on paper, punch them into an Excel spreadsheet and then e-mail them to employees and subcontractors. The process was painfully inefficient, defects were hard to track, and it was difficult to know who would tackle them.

So Ms. Hasegawa and Ms. Brodie developed Bridgit, a cloud-based smartphone application that lets site supervisors take photos of issues, share them with employees and track them to completion.

Since they started the business in December of 2012, more than 600 subcontractors have used the pilot version at building sites for condos, hospitals and other structures in Ontario and Manitoba. “We haven’t even launched the official full commercial [version] yet and we’ve got so many big companies interested and committed,” Ms. Hasegawa says.

But they’ve also been receiving feedback from people who think Bridgit would make a handy consumer app – an all-purpose tracking tool – as well. The necessary modifications would be cosmetic, and the new tool would have a different name.

“Our focus is 100 per cent on the enterprise customers, but at the same time if all these people are asking us for a consumer side it seems worth pursuing,” Ms. Brodie says.

“We don’t want to cheapen the enterprise product,” Ms. Hasegawa says. Yet they don’t want to miss out on the potential to tap into two markets at the same time, though with only a small staff of 10 and limited resources, branching out into a second offering could be risky.

“If we wait two years then somebody else will be in that space already,” she says.

THE CHALLENGE: Should Bridgit stay the course or begin tapping into the consumer market?

THE EXPERTS WEIGH IN

Dave Valliere, chair of entrepreneurship and strategy at the Ted Rogers School of Management, Ryerson University, Toronto

When deciding whether to go after a new market opportunity, think “should, could and would.” “Should” means whether the new market is attractive to somebody – how big is the revenue opportunity, how fast is it growing, and how large are the margins? “Could” means whether you have the capability to be that “somebody.” Selling to consumers is very different than selling to businesses. Consumers are likely to demand expensive new distribution channels and support infrastructure. And while they might not need the same level of reliability that businesses demand, you cannot drop that and still keep your business-customer base. Finally, “would” refers to whether it’s what you really want, and why you got into this business in the first place.

Every minute spent tweaking the product to serve the consumer market is a minute not spent delighting the existing business customers. So, if you allow yourself to be distracted by a short-term opportunity, make sure it pays enough to cover the cost of what you are losing by being distracted.

Matt Saunders, president of Ryerson Futures, a business accelerator connected to the Digital Media Zone at Ryerson University, and Bridgit’s former lead mentor, Toronto

If you’re the consumer buying a condo or property, what’s the business model leading you to use or buy the app? Who is going to pay for it? Maybe you get stuff done faster, but ultimately most of that work is going to be done during development before the builder signs off and turns the building over. They’re the ones who have the money to pay for the system, and that’s where Bridgit is getting traction.

With such a small team, Bridgit shouldn’t split its focus and follow a market that may not generate significant value in the short term. I’d be less concerned about whether someone is going to come in and eat their lunch. Well, if they’re not executing properly and not developing a solution that people want, they’re going to get beat anyway. It’s sort of irrelevant to focus on that. They should focus on serving the market, solving the problem, and as the team grows and scales, and other options open up in the future that don’t distract them from succeeding on their original goal, then sure, go after it.

James Lochrie, co-founder and chief technology officer for the small business apps developer Wave Accounting Inc., Toronto

Our product lineup has been continuously expanding around the notion that our end user is the small business owner. We focus on their needs.

Until you’re comfortable with your business as a whole, and know your primary market and believe that as a business you can win in it and grow, then I would stay completely focused on that market.

In today’s marketplace it’s all about how good the product is. If you are expanding to a different customer base you have to make sure you’ve got the resources available to be able to maintain your current customer base and be constantly improving, tweaking your current product from both a development and marketing standpoint.

THREE THINGS THE COMPANY COULD DO NOW

Do your research

Establish the “should, could and would” as well as your appetite for risk, the cost of expansion and the resources you could reasonably devote to expanding your offering.

Don’t get distracted by short-term opportunity

Although another market may seem lucrative, in the early days it’s important to focus on building a strong foundation before expanding.

Stay focused on the market

Identify the core customer and be sure any tertiary products will focus on that customer.

Interviews have been edited and condensed.

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