Sydney will host TiECON 2015 in a fortnight, a conference aimed at helping entrepreneurs dive into international markets. The day-long conference will look at how startups can achieve success through exporting as well as how to expand overseas. Mathias Kopp, president of the TiE Network Sydney, told StartupSmart the conference will bring together entrepreneurs, venture capitalists and industry executives. “The theme is going global and we are addressing entrepreneurs that are slightly more mature than just an ordinary startup – who have some traction in their home market and are now considering going overseas, wherever that is,” he says. “What we want to get out of it is better informed entrepreneurs who want to take their adventures global. So we want to add tangible value to participants.” Kopp says expanding into international markets is a topic not often discussed in Australia but is something that needs to be addressed if startups are to reach their full potential. “It’s highly relevant because, as you would appreciate, the Australian home market is rather small and all Australian startups will have to have global ambitions,” he says. “I would always argue that it doesn’t make sense to get distracted and move too quickly into an overseas market if you haven’t actually got a footprint in your home market. Australia is a great home market because it’s small and you can learn from mistakes without risking falling over.” “My advice would always be get traction here before considering moving into other markets.” TieCON 2015 will be held on March 3 with tickets costing $79 for non-TiE members or $49 for full-time students. Speakers will include the managing director of ANZ’s Innovyz program, Jana Matthews, and the founder of eServGlobal, Ian Buddery. The conference will conclude with a pitching competition for startups that have a plan to expand overseas and are seeking capital. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Federal Treasurer Joe Hockey has warned that taxpayer subsidies won’t be paid to companies that fail to fix their problems, The Australian reports. He told the newspaper that taxpayer funds won’t be used to shore up dividends or to continue poor industrial practices. “The government should not be subsidising poor workplace practices,” he said. “It is not the responsibility of taxpayers to prop up unprofitable companies.” ANZ eyes acquisitions and divestments in Asia ANZ bank could consider divesting some assets while on the lookout for acquisitions in Asia. The Australian reports ANZ chief executive Mike Smith indicating he was open to acquisitions and divestment of its stakes in Asian banks. “I have always been patient. Something will happen at some stage,” he said. “I still believe that some of the European bank assets will have to be sold off.” US data suggest strong economic growth US retail sales rose in December in a sign the economy gathered steam at the end of last year and is poised from stronger growth, Reuters reports. The Commerce Department said retail sales gained 0.2% last month. "The surge in sales in December means the momentum will continue into the first quarter of the new year. 2014 is shaping up to be pretty good from where we sit," said Chris Rupkey, chief economist at Bank of Tokyo-Mitsubishi UFJ in New York. Markets The Dow Jones Industrial Average is up 0.71% at 16,373.86 points, while the Australian dollar is buying US89.6 cents.
The Australian start-up ecosystem continues to grow rapidly, with hundreds of start-ups and several new funds and incubators emerging last year. Here’s our pick of five Australian start-ups to watch in 2014. Pozible (Melbourne) With crowdfunding taking off across the world and in Australia, this home-grown platform is one to watch as they take their show on the road and start targeting the United States. Pozible’s communications manager, Reuben Acciano, told StartupSmart in September they’d grown 550% in the last 18 months. Despite their solid growth and big plans, the Pozible team will also need to keep an eye on their home market with major international competitors such as Kickstarter set up Australian offices and targeted campaigns. “The nature of start-ups is we have strategies for anything that can happen, we know where we want to be but we need to be a little reactive. When the situation changes, we’re ready to move with it,” Acciano said. Ollo Mobile (Brisbane) This start-up burst onto the scene last year, taking out a series of pitching competitions, heading off to Silicon Valley briefly and launching a crowdfunding campaign, all steps in their promotional strategy to build awareness about their alternative to the panic button for elderly or unwell family members. Now targeting the United States for both consumers and funding, the start-up will begin their international roll out in 2014, tapping into an international demographic trend of ageing populations. “What we’re doing is a bit different and finding investors with experience in our space and access to the market channels has been difficult here as it is such a small community and what we’re doing is quite specialised,” co-founder Hugh Geiger told StartupSmart. Your Fork (Sydney) Despite only being a few months old, this start-up sits amid several trends that could take off in 2014. A hyperlocal, peer-to-peer network for delivering homemade meals, Your Fork taps into collaborative consumption, internet enabled connections and crowdsourced solutions as well as Australia’s growing interest in foreign and unusual foods. Launched by brothers and start-up veterans Roshan and Shanu Mahanama, Your Fork is currently overseeing their first alpha test location in Sydney. The Mahanama brothers aren’t the only start-ups to have connected the trends that could make this kind of start-up take off in 2014. Several other start-ups are exploring the idea and experimenting independently across Australia. But Roshan says the idea is so new they’d welcome competition from other start-ups to develop the model and public understanding. “Ironically what we need is more than one start-up attacking this space,” Roshan says. “A big challenge is raising awareness of this emerging market. So if there are more of us we can accelerate it, and consolidation will happen later down the track.” CoinJar (Melbourne) Everyone is talking about bitcoin this year, which comes as no surprise to Asher Tan and Ryan Zhou, the founders of CoinJar who have been passionate about the digital currency’s potential since before it was news. In December, Tan told StartupSmart despite the ups and downs in bitcoin’s value, its time had come. “A lot of people talk about a bitcoin bubble, but the case is too strong to ignore,” Tan said. “One of the unique draws of bitcoin is totally people-powered. As long as people remain interested, bitcoin won’t die out.” Experimenting at the forefront of innovation and digital practice has brought challenges to the team, who found their personal accounts at the Commonwealth Bank frozen without warning or explanation in August. Despite the newness and risk of bitcoin, the AngelCube accelerator graduate recently received $500,000 from Blackbird Ventures. The funds will go towards speeding up their global expansion. Tan described the investment as a credibility breakthrough for their start-up. “We’re very new to this, so the investors are bringing legitimacy to our business. A lot of people ask us how do they know we’re not a scam, so having such well-known and respected investors means people will trust us more.” Ingogo (Sydney) Launched in 2011, ingogo started life as a taxi booking app and has grown steadily ever since, with chief executive Hamish Petrie telling StartupSmart in August 2013 they had reached 15% of the Sydney taxi drivers. 2013 was a huge year for ingogo, who announced a partnership with ANZ, successful million dollar fundraising rounds in February, August and December. They also announced a game-changing payment platform via a partnership with ANZ. Not only is the payment system an additional revenue stream from their taxi business, but also has significant potential to be rolled out into other industries. “A lot of the IP we’ve built up is applicable to other environments that are possibly less demanding,” Petrie said. “We’ve learned a lot about doing payments in a mobile and challenging environment. Taxi payments involve a lot of issues with mobile internet connections, drivers speaking different languages and the need to process payments reliably and rapidly.” Petrie told StartupSmart the start-up will break even early this year, and shared his plans to list the three year old company on the ASX in 2014.
What are the main issues Australian start-ups are grappling with? Accountancy and business advisor network DFK recently conducted a survey of its clients and staff to identify the top 10. We’ve already highlighted number 10, cloud computing, and number nine, exit strategies. The beefy Australian dollar is in at number eight, while political uncertainty is seventh, growing pains number six, while number five is how to hire and keep staff or let them go quickly. Number four was falling consumer consumption and number three is tax. We’re now at issue number two -- funding. The DFK survey shows the second hardest challenge for start-ups is – not surprisingly – funding. Raising money is tough – especially if you have few assets and no useful network – but don’t give up! There are opportunities out there. The banks are usually very restrictive when it comes to lending money to start-ups, especially if you have little or no assets yourself. Still, there are opportunities, it all depends on you. What is your experience? How long have you been in the industry you’re planning to start the business in? Do you have good references? Do you have a great mentor to support you? How do you carry yourself? So, you tick all those boxes? Well, pull up your socks even further. Create the best business plan that there ever was. Be sure your business plan contains all the different parts: organisational, marketing, operational, financial and risk analysis, etc. If you don’t know how to do it, get someone to help you. There are plenty of different solutions. Use your accountant or business advisor or do it yourself – just Google business plans. The level of funding required will vary. “It depends what business you’re starting, but if it’s not cost intensive, maybe the balance on your credit card will be enough. Of course, if you’re going into heavy manufacturing then other solutions are necessary,” says Cheree Woolcock, partner of DFK Australia New Zealand. ANZ has recently announced that they are targeting the small business market, so it looks like NAB will get some competition, which is good for you. Recently, Nick Reade, ANZ general manager of small business, was quoted in The Australian saying many banks don’t play in the start-up field: “There are a couple of hundred thousand new small businesses every year and we feel that we need to be in that market.” “We can only applaud the bank for being active. Who knows what business Australia would have missed out on, due to lack of capital,” thinks Woolcock. ANZ said it was now approving more than seven out of ten lending applications from new small operations, a proportion it wants to increase. This development is gaining pace, and as we see here at SUS, many new businesses are online-only. “We see that some banks have been reluctant to lend to online-only business, but I think banks also need to adjust to the cloud-business-world,” says Woolcock. There are other choices for people now as well, particularly in the start-up space. There is a lot of hype around angel investors, seed capital and crowdfunding, so people might not be as willing to go to the bank. Adrian Stone knows this better than anyone else as co-founder of Angel Cube and winner of the Best Start-up Investor award. They take a minority equity stake in internet companies and in return provide seed capital, mentorship, marketing, connections, administrative help and support services (such as legal, accounting and office space). “I don’t see anyone around me using the bank system. By the time they react, the business is already up and running, and sold. The lifecycle for our entrepreneurs is four years,” says Stone. The web-based businesses in Australia (and elsewhere) are working in an environment characterised by low costs and high speed. “The entrepreneurs that go through our program are walking out with $150,000 to $200,000 after six to nine months,” tells Stone. So there is hope out there for your business too. How to best get funding within the bank system: Polish and perfect yourself and your skills Organise credible references Produce an outstanding business plan Keep a clean credit history Start your business in different steps with the funding you get How to best get funding outside the bank system: Government grants – plus there are many other grants as well, locally, different areas and for particular business owners Angel investors Crowdfunding Seed funding is a form of securities offering where an investor purchases part of a business. There are many different types of funding depending on what sector your business is in.
Small businesses are already disappointed with the major banks, but newly released survey results show the relationship between the big four and SMEs has soured even further. The release of Roy Morgan data regarding bank satisfaction comes as the Small Business Council of Australia (COSBOA) hosts a roundtable in Canberra today, in order to discuss the current problems facing small business access to finance. Roy Morgan data released yesterday shows satisfaction among the big four's business customers in April was just 63.7%, down from 64%, and still well below the satisfaction level of personal customers, which sat at 78.9% in April. The figures show the satisfaction gap between small businesses and banks has continued to widen, with personal customer satisfaction improving by 2.4 percentage points compared to business satisfaction, which has fallen by 0.4 percentage points. Westpac leads the survey, followed by the Commonwealth Bank, NAB and ANZ. The Commonwealth Bank moved up three percentage points over the past year – the only one of the big four to improve – and ANZ has fallen by 4.4 points. The satisfaction differs between different-sized businesses. The micro segment, with turnover less than $1 million a year, was the least satisfied segment at 63.3%, but the segment covering businesses with over $55 million in turnover didn't record any significant improvement, at just 67.6%. Norman Morris, communications director at Roy Morgan, said in a statement the banks are continuing to struggle. "It is obvious that a poor rating among business customers will impact on personal customer ratings yet this is often not clearly understood. In the case of the approximately two million small businesses; the owners' personal and business interests are closely interlinked, as is their banking." Part of the dissatisfaction comes due to interest rate levels. Although the banks have passed on the most recent rate cut to business products, traditionally business loans attract higher interest rates and banks are loathe to pass on any cut in the official rate. Peter Strong, executive director of COSBOA, told SmartCompany this morning the findings are apt given today's conference about small business access to finance. "I think this reflects just a drop in confidence in general," he says. "The other disappointment we're seeing is the difference between interest rates for consumers and businesses. They've come back closer, but why is there even a difference?" Most recently the big four passed on interest rate cuts to business customers, although ANZ was the only bank not to extend the same rate cut to business customers as individual mortgage holders. Such problems are what Strong hope to address today at the roundtable with attendees including Steven Munchenberg, the chief executive of the Australian Banking Association, along with COSBOA board members and a range of experts. Other topics of discussion include identifying the specific types of SMEs which want to grow, and how many of them need access to credit. "We just want more information," Strong says. Earlier this year the small business community was disappointed by the news the federal government would back down on legislation which would regulate small business credit. This story first appeared on SmartCompany.
Queensland toll road operator BrisConnections has collapsed seven months after the opening of the troubled $4.8 billion Airport Link tollway in Brisbane.
Economic news has been largely doom and gloom over the past few years, but there are five reasons the Australian economy is moving toward happier days.
Small business sales rose 2.8% over the year to the December quarter, according to ANZ’s latest Small Business Sales Trends report, with business services described as “the story of the year”.
Small business sales rose by 3.6% over the year to the three months to October, according to the latest ANZ report, as food and travel-related services continue to outshine “traditional” retailers.
A commodity price increase will push the Australian dollar even higher, giving leeway to the Reserve Bank to cut interest rates again, the CEO of ANZ has predicted.
Retail sales remained stubbornly sluggish in September, with particular weakness in the trade services and homeware markets, according to new ANZ figures.
Small business sales rose by almost 5% year-on-year in July and by 3.8% over the year to the three months to July, with assistance for households as part of the carbon tax package a main driver, according to a new report
The National Australia Bank raised its business lending loans rate by 20 basis points yesterday but the other major lenders are reluctant to reveal whether they will also bump up loan rates.
Spending is up more than 10% on a year ago, according to the Commonwealth Bank Business Sales Indicator, which shows Queensland has marked its 12th straight month of trend BSI gains.
The South Australian Government has poured $600,000 into the ANZ Innovyz START program, in what could be an attempt to restore its reputation among the state’s start-up community.
Mining billionaire Gina Rinehart has threatened to sell her shares in Fairfax if she is not offered director positions at the business “without unsuitable conditions”.
Small business sales increased by 2.5% year-on-year in March, according to ANZ’s latest Small Business Sales Trends report, but other research shows economic activity remains below trend.
Businesses appeared slightly more confident in March than in February, according to the latest NAB survey, but a degree of caution appears to be inhibiting hiring and investment decisions.
Australia’s major banks are pushing for the definition of ordinary working hours to be extended to include Saturday afternoons and all of Sundays.
Australia’s major banks are pushing for the definition of ordinary working hours to be extended to include Saturday afternoons and all of Sundays, in a bid to improve flexibility of rostering employees on weekends.