Revealed: The 10 secrets of the Start-up 50’s success
If any further evidence was needed of the changing face of Australian business, this year’s Start-up 50 provides it in buckets.
The 50 fastest-growing businesses in the 2011 StartupSmart Awards are bringing innovative ideas and niches to the marketplace, often inspired by the global economy, as well as re-defining the age, gender and working habits that are traditionally associated with SMEs.
The inaugural StartupSmart awards rank Australia's top start ups by revenue. To be eligible, companies must have started within the past four years and have more than $250,000 in revenue. To see the full list and the category winning companies, click here.
Top of the pile is Job Capital, founded by Jo Burston. The business, which has a $9.14 million revenue, was started by Burston after she pitched the idea to an investor at a work meeting.
Overall, the top 50 companies’ numbers are impressive for ventures that are four years old and under. Total revenue stands at $88 million, with the businesses employing 808 employees.
Twenty-two of the top 50 have made more than $1 million in revenue, with 15 of those achieving this feat within their first year.
Geographically, 24 are based in NSW, 15 come from Victoria, eight are from Queensland, two are based in WA and one is from South Australia.
So what are the secrets to the success of this year’s top 50? We’ve picked through each business to reveal the 10 trends that set them apart from the rest.
They don’t see gender or age as a barrier
There’s a significant number of young entrepreneurs too. Matthew Sampson started Aspect Personnel as a 22-year-old with just 18 months experience in the recruitment sector and grew it into a $3 million business, the founders of Milan Direct were both just 25-years-old when they started and Milan Rajkovic was only 18 when he started his IT company.
Out-dated attitudes still exist – just ask 4Cabling founder Nicole Kersh, who still is met by disbelief when she reveals that she heads the business. But it’s clear that age and gender are increasingly irrelevant to start-up success.
They relish flexibility
Many entrepreneurs cite the liberation of employment as being the best part of starting up and the top 50 are no different.
Some, like Paul Morffew of MRS, wanted to break free from a restrictive previous career – in his case, an auditor – while others, like Michael Mulgrew of Alba Print Management, identified flaws in the way big business operates and set out to work in a more effective way.
The common thread is that these entrepreneurs weren’t happy to stay in jobs that hemmed them in. They craved flexibility and, rather than just complain about their situation, did something about it.
As Job Capital’s Burston puts it: “I absolutely love working on my business and unlike being in the corporate world, don't get bogged down with meetings about meetings.”
“My last company was so structured that individual flair and ability to grow ideas into revenue was stifled. It was suffocating. I feel the most liberated I have ever felt in business and so does my amazing team.”
They value work/life balance
While their businesses are their consuming passions, that doesn’t mean that the upcoming generation of entrepreneurs are happy to be all work and no play.
Advances in technology have allowed for a greater work/life balance and, with 70% of the top 50 starting their business from home, work is no longer in an office many kilometres away from family and friends.
Some, like single father and sole trader Jarrod Tame of Fifo Capital, relish the time spent with family, while others, like Pulse+IT Magazine founder Simon James, are able to work completely remotely – James spends at least half the year skiing overseas. “I joke that I'm probably the highest paid ski instructor in the world,” he says.
Yvette Adams, founder of The Creative Collective, says: “The key driving factor now is my eternal quest for the ideal lifestyle.”
“I love juggling the needs of my family and partner, with my own personal needs and combining time with my friends, fitness, rest and relaxation with the rigorous demands and rewards of business.”
“I live on the Sunshine Coast and can work from the beach, take school holidays off with the kids and go away on holidays.”
They think your business is crap
It takes a particular talent to spot a start-up opportunity and then grow it into a thriving opportunity. Going by this year’s top 50, entrepreneurs aren’t afraid to negatively critique their own employers or other business and then set out to top them.
Larissa Robertson, founder of SCO Recruitment, identified the problems in her failing employer and proposed a radical solution. She was rebuffed but, undaunted, she went ahead with the idea anyway, building an $8 million business in the process.
Mount Lawley Pets and Puppies was spawned from the founders’ disgust at the condition of puppies kept in pet store enclosures and Mad Mex Fresh Mexican Grill came about from the “cheesy, greasy” Mexican food served up to Sydney diners.
They are obsessive about customer service
Putting customers first isn’t exactly a revolutionary idea, but it’s one that the Start-up 50 has embraced with ruthless zeal.
Smoke Alarm Solutions has standards in place that include responding to each phone call in three rings, replying to emails in five minutes and offering loyalty incentives ranging from iPads to brand new cars.
Customer service isn’t just about such visible front-line acts though, as Milan Direct demonstrates with its diligent work in finding the right suppliers and warehouses to meet its clients’ expectations and the empowerment of staff by overall winner Job Capital, which implicitly trusts its hand-picked employees to make the best decisions for the company.
They aren’t afraid to redefine industries
Not so long ago, selling furniture online would’ve been considered a ridiculous idea. This didn’t stop either Milan Direct nor Fidarsi Furniture for doing just that and reaping the rewards.
Elsewhere in the top 50, RedBubble revamped the online retail marketplace with its shopfront business model that showcases leading artists and Kidz Lidz Salons does hairdressing with a twist – its clients are all children.
The moral of the story is that you don’t have to blindly follow others or create an entirely new market. Top entrepreneurs can take exisiting business models, subtly redefine them to new territory and create lucrative new companies.
They are at the cutting edge
Anyone who believes that Australia isn’t a hub of innovation should take a look at this year’s top 50. New ideas and cutting edge technology are sprinkled liberally on the list.
Green technology is, unsurprisingly, leading the way, with AquaGen Technologies creating a new way of harnessing tidal power, all tested in the Victorian coastal town of Lorne, while Direct Energy is a pioneer in geothermal energy.
Not all new ideas come from the environmental sector – Expanda Van Homes is leading the way with a van-cum-house creation and Inventium invited a psychometric tool to measure performance at work.
They are quick to gain inspiration from overseas
As the modern-day business maxim goes, entrepreneurs are now as likely to come up against competitors in Delhi as they are in Darwin. But the global economy also provides plenty of inspiration for Australian start-ups – and more quickly than ever before.
The founders of Everyday Hero were struck by how developed the online charitable giving sector was in the UK compared with Australia. They moved quickly and have now effectively cornered the market in Australia.
Meanwhile, Dean Ramler was backpacking his way around Europe when he realised that the high demand for replica designer furniture may have been met at reasonable cost in Italy, but it wasn’t in Australia, unless you felt like spending $4,000 a time.
The next generation of Australian entrepreneurs aren’t just inspired by their immediate surroundings. An idea from anywhere in the world can now be transported back home.
They were willing to ditch comfortable, safe careers to start-up
For entrepreneurs in our top 50, a stable, risk-free career isn’t a comfort, it’s a burden to be shed at the earliest possible opportunity.
While others may have vacillated at the thought of giving up a regular income in order to chase a start-up idea, our business builders were happy to ditch their jobs in order to go it alone.
For example, Clovis Young gave up a lucrative career as a Wall Street banker to create Mad Mex Fresh Mexican Grill, while Design Experts co-founder Tim Gentle quit his job as a marketer to become a farmer and teach rural businesses the potential of the internet and online marketing.
They’re not keen on giving up control
Of our top 50 businesses, 72% of them are wholly-owned by the founders. This is a group that generally likes to build their business in their own image, away from the meddling of investors.
The desire for control by top 50 entrepreneurs is mainly rooted in quality control. Jarrod Tame of Fifo Capital is a one-man band despite the business pulling in a revenue of $3 million. He cites the lengthy time spent with clients as a key driver of the business – something that others might not be able to replicate.
Some owners take this even further. Cara Kirsten, founder of radiology business Sound Diagnostic Radiology, came to work while her twins, who were born prematurely, were still in hospital in order to make sure the company was running smoothly. She is planning gradual expansion of the business so that service delivery isn’t compromised.
Of course, plenty of these businesses will face growing pains as they move into the fast-growth stage. But the early focus on high standards and attention to detail is admirable.