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The pitfalls of choosing a name for your business

Andrew Smith had the idea for a new app that would allow companies to get feedback from customers and, in return, reward them. And although he didn't have the app developed yet, he was bent on finding the perfect name; one that would attract customers in an app store.

The former head of mergers and acquisitions at BCE, who had quit his job in 2012 to form Twelve Mile Capital, the holding company through which he would create the app, obsessed over the product's name for months. He pored over branding books and sat down with his team with a whiteboard, but still couldn't find the ideal moniker.

"I was looking for a word that was super short, that resonated, that was a bit cool, a bit sexy," he says.

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Mr. Smith nearly settled on the name Clapback, but while listening to a John Cougar Mellencamp song, the right name finally came to him: Strum.

But there was a catch. The already to a Nova Scotia engineering company. While he had secured urls for every name he had considered up to that point, his final choice was so simple and direct that its variations were gone too. He finally settled on and secured the @strumapp handle on Twitter and /Strum on Facebook.

He also trademarked the name – a move he now feels is more important than securing electronic dibs on the url, as it gives you a legal foothold if someone comes along and starts using the same name.

"I realized that you don't need the domain name," he says.

Launched in May, 2013, Strum's free app allows customers to send messages to retailers to offer feedback and compliments. In return, companies can use the app to offer rewards and deals to their customers – for a small fee to Strum. The Toronto-based company currently has 10 employees and has landed clients such as Sport Chek and Firkin pub locations in Toronto.

Naming your company and products is no easy task. The business world is clogged with startups, rock bands and game developers which have already nabbed most of the compelling short names business owners want.

Also, it's not just about trademarking the name. Today you've also got to land a great url, find a name that will help rank you highly on search engines and secure social media handles that match across the board.

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"Frankly, the single most important piece of brand work a company every does is get the right name," says Max Valiquette, managing director of strategy at Toronto ad agency Bensimon Byrne. "Yet it's like capturing lightening in a bottle. It's very hard to do."

The added pressures of the crowded digital marketplace are triggering a shift in naming trends, he adds. "Where things are going is that searchability and net applicability are becoming the most important parts of a brand name."

To try to set themselves apart, companies are messing with the spellings of common words (i.e. Google), opting for two-word names – but choosing two words that aren't normally found together (i.e. Dreamworks) – and even inventing words (i.e. Zynga); all in an effort to land that elusive top spot on a search engine and snag a .com url, along with good Twitter and Facebook monikers.

This new approach is leading to what might be the end of the descriptive company name.

Dan Seto found out the hard way that such names have limits: they're difficult to trademark, find digital monikers to match and don't work well if your startup pivots. A serial entrepreneur, he launched Green Energy Watchdog in May 2009 in Ajax, Ontario, with a technology that monitored wind turbines.

But the product didn't sell: wind turbine users liked the technology, but turbine manufacturers didn't approve.

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Mr. Seto and his team realized their hardware and software system could easily be adapted for use in commercial buildings trying to go green or save money.

His team pivoted to become a combination hardware-software package that installs monitors at the circuit level that send information to a cloud-based software system that keeps track of every circuit's energy usage.

In Oct. 2012, when private venture fund MaRS Cleantech Fund came along with investment dollars, the first thing representative said was: "We don't like the name." Mr. Seto agreed it didn't suit the company any more.

MaRS referred Mr. Seto to branding consultants, but he opted instead to speak with experienced team members, staff from MaRS and some outside help to brainstorm. He did heed their advice, however, that in the crowded environmental market, 'green' names are massively overused.

His team of experts put out their shortlist on SurveyMonkey and CircuitMeter came back as the clear winner. It aptly described the company's technology, but was flexible enough to take into account future business shifts. Product names WebMeter and CircuitMonitoring were easily spun off the company name. As a bonus, no one had yet combined these words and all trademarks and urls were available.

The company changed its name in Nov. 2012. It's currently piloting its solution – which ranges from as little as $50 a month to monitor a small storefront, but a few thousands, plus installation costs, for a larger commercial building. The company of three employees will roll out to market at full tilt over the next few months.

Mr. Seto says that while the naming process does involve new factors, the fundamentals remain the same. "If you really know the business and you can really articulate it, the name will just pop up."

Indeed, industry veterans see the influence of technology on name as a slight, and not radical, shift.

Serial entrepreneur Michael Meagher thinks naming has always been difficult. "SEO has been going on forever. The first SEO that I know of is guys that named their companies so they'll be optimized in the yellow pages."

The AAAAAA Plumbing Services of the world, he says, may get their high rankings, but not for long. "A name that means nothing and doesn't appeal to audiences has no benefit because you built it on a flimsy premise. You are just one A in a growing field of As."

He is part of the new naming trend. He's president of Cogniciti – a made-up word with great SEO – a startup with 24 staff members affiliated with health sciences centre Baycrest in Toronto. It's set to launch an online tool to let users assess their brain health in October. He joined the company in 2011, but it was founded in 2009 and named a year later.

"I think they ended up with a pretty smart name. It's unique. And it gives us great room to grow and change," says Mr. Meagher.

That said, he admits that he'd be fine with a less winning moniker, and suggests other startup founders ponder the same philosophy. "In small business, we get consumed by questions such as names and legal stuff and paperwork and get distracted from the tough stuff of building a business."

Mr. Meagher thinks knowing your brand, making use of your tag line, and being savvy on social media can help a company with even a bland name get noticed. And companies that deliver great products or services will thrive no matter what they're called.

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