“It’ll never work.” “It’s not trustworthy.” “It’s not fair.” “It’s illegal.” For the last 20 years, this sequence of responses has become quite common to those who watch the internet and the creative companies it’s spawned. Incumbent businesses confronted by these digital disrupters resist changes to the status quo for understandable reasons: they were winning at a game they had mastered. When the game changes, efforts to strengthen the previous barriers to entry are standard procedure. Microsoft did it to Linux (an open-source operating system), the Bell companies fought voice service competition from cable-TV triple-plays and startups like Vonage, and record labels defeated Napster and then proceeded to sue their own customers once they realized peer-to-peer file sharing could not be shut down at a central locus. More recently, Airbnb and Uber have inspired a new generation of incumbents to play these same cards. Both companies have grown at phenomenal rates over short lifetimes, both rely on not owning the core asset (sleeping rooms in the former case, cars in the latter), and both have attracted sky-high equity valuations. Because of these traits, they have also attracted the attention of asset-owners who formerly profited from scarcity and thus are threatened by the lower prices brought by the asset-light coordination model of these two disrupters. This threat has prompted the asset-owners to erect barriers to entry wherever they can, often in the guise of more regulation. Just this month, Airbnb faced a proposal in San Francisco that would place more restrictions on rentals, while Uber has inspired fierce opposition to a bill that would allow its entrance into the Nevada (read “deliberately scarce Las Vegas taxi”) market. More interestingly, New York hotel interests are fighting Airbnb’s efforts to pay lodging taxes, in part because doing so would seem to legitimize the new competitor. In all cases, the incumbents are trying to use their links to legislators to increase regulation of their sector, biased toward status-quo definitions of same. But such efforts that purport to protect consumers lead to all sorts of unintended consequences. Previous efforts to stifle disruptive technologies have often been costly for the economy and in the end unsuccessful, no matter how logical and attractive they appeared to be at the time. Sharing beds and cars Both Airbnb and Uber make commissions by matching sleepers or riders with beds or cars, aided by the internet’s tendency to lower coordination costs and smartphones' unique combination of geographic context, rich visuals and ubiquitous wireless networking. It’s a much more attractive model than owning infrastructure and having to pay health care for employees. Across the world, many taxi and limousine commissions (TLCs) have ruled Uber illegal (even so, the service currently operates in 55 countries). Couch-surfing is more difficult to regulate: a 30-story hotel in Times Square is impossible to miss, while 20,000 available rooms in New York city (the figure dates from 2014) are mostly invisible from the street. In both cases, however, the incumbents can only do so much by way of competition: cab fares are set by law and taxi medallions are scarce for obvious reasons. In New York, the price of those medallions dropped by 17% (about $200,000) between 2013 and 2015, so Uber is hurting incumbents where it counts. Hotels with high fixed expenses, meanwhile, can only compete with Airbnb in subtle ways: saying “we’re cleaner than Joe Blow’s guest room” might be seen as damaging the brand while validating the competition. As a result, these incumbents can do little except drop prices or resort to regulatory protection. In part, this paucity of options reflects the highly fragmented nature of both markets. Trying to organize 50,000 licensed New York taxi drivers (who share 13,600 vehicles) to improve service, speed up pick-up times or otherwise compete with Uber on quality would be a logistical impossibility. Incentives aren’t aligned: the medallion owners don’t drive cars. Furthermore, taxi companies have been slow to invest in GPS and similar technology, guarded as they were by the regulated scarcity. Hailing and hoping Compare this model to Uber, in which the car owner is the driver. The smartphone app is a far superior method of arranging a ride compared with hailing and hoping – or even calling a dispatcher then hoping. Much like Fedex, Uber’s supply chain visibility (knowledge of where the package or cab is) contributes to the overall value of the experience. Conversely, waiting for a cab to get to the airport is made much more stressful by the lack of knowledge of where the ride is or how bad traffic is on a given route. Airbnb uses a similar confidence builder, wrapping information around the transaction. Much like eBay (its business-model grandfather), Airbnb rates both buyers and sellers, making both opening one’s home and staying in a private residence less of a gamble. For both Airbnb and Uber, the low barrier to entry and then the decentralized structure of the asset threatens the incumbents' moats: medallions in the taxi setting, real estate investment and heavy overhead (branding, IT systems and labor costs) in the case of a hotel. Complex regulation protects incumbents It’s important to realize how complex business regulation has become. What started as an effort in consumer protection (think of Upton Sinclair, “The Jungle,” and the creation of what became the FDA) now serves to do multiple additional things: to employ regulators who have a vested interest in keeping their jobs to maintain barriers to new-market entry and thus innovation to reassure markets and investors of a stable competitive environment. Thus what looks like “illegal” or “unfair” competition is in fact often a matter of innovation breaking an outdated, well-protected business model that has focused on profits rather than customer service or competitive differentiation. Note that in every case we have mentioned, the consumer protection function of regulation did not drive efforts to outlaw the competitive threat: Linux, VoIP, and unbundled CDs all dropped prices in the market while arguably improving quality. Regulators, however, need things to regulate, as we have just seen when the Federal Communications Commission defined the internet in such a way as to make up for millions of Americans abandoning wireline phone service, its primary locus of influence and revenue. Thus the incumbents and the regulators face a common threat. Room for regulation, but… At the same time, it’s worth noting that Airbnb’s and Uber’s independent contractors, with few exceptions, are looking littler and littler in light of the massive valuations and global aspirations of the two startups. In the latter case particularly, drivers have faced repeated and arbitrary changes in compensation models. Uber asserts that these changes should increase gross revenues, but the effect on operating expenses (and thus take-home pay) is less clear. Given the power imbalance between very big money at headquarters and independent contractors at the edge of the network, there is scope for harm, for protection and for risk – and thus a potential place for regulation – but those affected lack the political weight to compete with the more powerful motivator of eroded profits among a small number of incumbents. Labor unions and regulations protecting both workplace safety and the right of workers to organize were part of the answer to a similar imbalance in the 20th century. It’s as yet unclear what new arrangements could emerge now. So when a TLC tries to block Uber cars from accessing airport terminals, or hotels ask a city to refuse Airbnb’s efforts to pay lodging taxes, it’s worth asking: whose interests are being protected? Most likely, the legal efforts directly relate to the incumbent businesses that have been insulated from competition rather than to the common good, public safety, or economic progress. This article was originally published at The Conversation.
Microsoft has unveiled Windows Hello, a Windows 10 feature that uses infrared cameras to automatically identify users based on their face, eyes or fingerprints, without them needing to type in a user name and password. Windows Hello was unveiled as part of Microsoft’s Convergence 2015 business computing conference in Atlanta, Georgia. Once authenticated on a device, users will be able to access apps, websites and networks secured through the company’s Passport service without needing to key in a password each time. The new system will be opt-in only, with a user’s “biometric signature” to be stored locally on a device and will not be sent over a network. It will only work with devices that incorporate a fingerprint reader, illuminated IR sensor or other biometric sensors. It comes after Microsoft unveiled a number of identity authentication systems as part of its Azure cloud computing platform in March last year, including Azure Active Directory and Azure Access Rights Management that are interoperable with Windows Hello. At the conference, Microsoft also announced Lync replacement Skype for Business is rolling out next month. On the Internet of Things front, it has expanded Azure Intelligent Systems Service into a commercial product called Azure IoT Suite that allows businesses to manage and capture machine-generated data from sensors and devices. Also, the company’s Salesforce competitor, Dynamics CRM, is receiving a major update. For businesses using Office 365 or Yammer, there’s a preview available of Office 2016, and an Admin app for Office 365 that allows IT staff to remotely manage the service from Apple, Android or Windows Phones. Also, a new Office 365 dashboard feature called Delve uses machine learning to show users with Google Now-style cards with relevant work information. This article was originally published at SmartCompany.
Last week, prominent tech site Gigaom ceased operations with the terse note “Gigaom recently became unable to pay its creditors in full at this time”. Started in 2006 by Om Malik, the site had raised about $40 million over that period to create a technology news site, an IT analysis business and another business running IT events. None of them could make enough money to cover the $400,000 a month needed to keep the business going. For a site that covered the future of journalism and media in detail, it turned out that it had little insight into how to succeed in a landscape that is setting legacy media and digital media alike, in a continuous struggle to survive. The shutdown of Gigaom follows on the heels of AOL’s shutting down of two tech sites earlier this year. TUAW (The Unofficial Apple Weblog) and Joystiq were both closed by AOL as part of its process of “simplifying the portfolio of brands”. The problem that digital media sites face is that, unlike traditional print where their markets are protected geographically, websites largely compete on a level playing field, albeit one that is determined in part by Google’s (and others) ranking of sites in its search engine. Every tech story that is released gets rapidly echoed by literally hundreds of sites. Recycled tech news Take a recent article about Microsoft’s decision to release its personal assistant technology Cortana, across multiple platforms. A search in Google News brings up 290 versions of the same story. The ultimate irony is that the originating “exclusive” for this story from Reuters actually comes 15th in the list of news sorted by Google in order of “relevance”. As the majority of these sites make money from advertising, the inclusion of stories on any given site is motivated not by journalism, good or bad, but by the need to fill the site with constantly refreshing content. In fact, the job of journalism becomes solely one of copy editing, adjusting an already published story for style, format and length, for an individual site. The danger with this for those employed in this sector (or perhaps a blessing to finally convince them to do something else more worthwhile), is that computers are getting very much better at being able to generate this type of content. Algorithms will be able to take a press release, newswire story, or simply any other story circulating on the Internet and generate a new one with the right mix of specific language tied to brands, advertising, and possibly reader interest. Recycled news This state of affairs is not simply related to technology news. Taking any random headline from the NY Times; for example a story about CIA funds falling into the hands of Al Qaeda in Afghanistan gives 83 articles all repeating the same story as reported by the NY Times. At least in this case, the NY Times appears top of the list in the Google News search. The Senior Director of News and Social Products at Google, Richard Gingras and Sally Lehrman, a fellow of the Markulla Center for Appled Ethics, have suggested that the current situation has eroded the public’s [trust] of journalism in general. They quote reports from the Pew Research Center showing that “55 percent of Americans said they simply did not expect a fair, full and accurate account of the days’ events and issues. As many as 26 percent said they did not trust the news to get facts right.” The Trust Project Gingras and Lehrman’s solution to this lack of trust in journalism is the aptly titled, “The Trust Project”, a new effort led by the authors and the Markkula Center for Applied Ethics at Santa Clara University. This project proposes that all journalists should disclose their expertise and any conflicts of interest and engage in rigorous citation in their writing. The sites that they write for should also have a published code of ethics. Whilst these aims are highly laudable and should be common practice (The Conversation implements all of these principles), it is not clear that it will solve the ultimate problem that the vast majority of content on media sites on the Internet is derivative. One estimate by journalist Nick Davies claims that only 12% of stories featured in the UK’s quality press were original, the rest were what is often called “churnalism”. On the Internet that number will be higher just by the nature of the sheer volume of content that is produced every day. Journalism academic Jeff Jarvis has suggested additional recommendations to the Trust Project that involve Google News ranking derivative stories below the original sources in their search results. Judging the ultimate quality of articles in this way might prove difficult to do algorithmically. Gigaom’s passing will largely go unnoticed. There is an endless supply of other sites filling the void, although a vanishingly small number of them will be paying journalists or operating as a business making a profit. This article was originally published at The Conversation.
The BBC is set to give away a million Raspberry Pi-style computers to British school students to encourage children to take up coding. The BBC reports the program will see the British national broadcaster hand out the small computers, known as Micro Bits, in a bid to replicate the success of the BBC Micro B computer in the early 1980s in teaching kids how to code. The program aims to fill a skills shortage that will see the UK need to find an additional 1.4 million digital professionals over the coming years. A number of leading tech giants including ARM, Microsoft and Samsung are also involved. Microbric managing director Brenton O’Brien told StartupSmart the Micro Bits program is “a fantastic initiative” that should be replicated in Australia. Late last year, South Australian-based Microbric smashed a crowdfunding target for its Edison Lego-compatible robots, which it began shipping in the lead-up to Christmas. “There’s no doubt there’s a lot more demand for people with programming skills not just now but into the future, so it’s a fantastic program. The problem with getting tech into schools has always been affordability. Companies supporting an initiative like this can remove the cost burden from schools and increase the uptake,” O’Brien says. “If you look at the names supporting this, it’s pure capitalism. The companies see that they will need tech workers in the future, and governments aren’t doing what they’re supposed to. “Just this past week, [Federal Education Minister] Christopher Pyne was talking about scaling back the tech curriculum because it’s ‘too hard’ for teachers. The thought that someone would question the need for tech education in this day and age is absolutely absurd. So it’s great to see the sponsors putting their money where their mouth is. “It would be an absolutely fantastic thing to see Australian school kids exposed en masse to tech in a similar way. Coding is the new literacy… Their ability to make computers do what they want them to do is vital to the future of the economy.” However, Macquarie University’s Professor Michael Heimlich warns that while programs such as Micro Bits are well intentioned, they “don’t tell the full story to kids”. “I don’t want to dissuade people from putting tech into the classroom, but you need to make the connection about how kids are going to make a career out of STEM. Otherwise it will be something they leave behind in junior high school,” Heimlich says. Heimlich is helping to organise the FIRST Robotics Competition (FRC) Australia Regional Event, a competition aimed at high school students, which runs at the Sydney Olympic Sports Centre on March 13 and 14. “FRC is quite unique because, if you look at the surface, it’s a robotics competition. But what makes it unique is that it works a little like a startup incubator. So the program rewards things like going out to the community to raise money for their team, getting mentors, social media, website development and gaining skills. Heimlich says that along with raising STEM skills, it fulfils the important role of educating kids about STEM careers. “It’s really not a long step from a first-world to a third-world country. Just think about having a power grid that’s maintained, clean drinking water and trains that run reliably. When people tend to focus on the glitz and glam of the iPhone and Mars – even without an Australian Silicon Valley or space program – STEM has a big impact on the economy. Being a first-world country is underpinned by engineering,” he says. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Microsoft has launched its second Australian Innovation Centre, with the South Australian centre aiming to graduate more than 40 startups, provide training to at least 250 people and create at least 80 jobs over the next 18 months. MICSA will host regular training events, workshops, and a regular speaker series. It will also offer startups meeting rooms and facilities, industry connections, software and cloud credits through its BizSpark and BizSpark Plus programs The establishment of MICSA comes after Microsoft launched its Queensland Microsoft Innovation Centre in May 2012. Microsoft also runs the BizSpark Plus program, which offers startups access Microsoft Windows Azure services over two years, along with other tools and software. Microsoft Australia state director Brian Kealey told StartupSmart South Australia is uniquely positioned in terms of government, academic and industry backing that will allow the program to work. “The tech startup sector is a critical part of the economy going forward, and we see it as our role to help foster that. We make this investment to grow the economy, but won’t take an equity position or force the startups to sign anything. That said, if startups need access to equity, we can help to make those connections,” Kealey says. MICSA adds to a booming Adelaide tech startup scene that already includes the Majoran Distillery, the Innovyz program and Simon Hackett’s Base64. According to Kealy, MICSA is designed to add to the existing SA ecosystem, rather than compete against it. “We built a foundation group and run a month scrum to get feedback and see if this is definitely going to help with growth… We have, over the past six to 12 months, worked with Hills Innovation, Hub Adelaide, Majoran and a range of other partners. So, for example, we use Majoran as a co-working space if they need help with co-working,” Kealey says. According to Kealey, MICSA intends to offer its services both in a programmatic and a-la-carte fashion. Also, participation is not limited strictly to startups working with Microsoft platforms or technologies. “We reach out to startups through social media, coworking spaces and various other channels. That said, 90% of the startups bring their idea to a competition, coworking space or program and get referred to us for training to become part of MICSA,” he says. “We can provide startups with access to our technology through our BizSpark programs, and [the Microsoft] Azure [cloud platform] certainly will support PHP, MySQL, Linux and a range of other open web technologies. That said, we can do a lot more, like training connections and development, regardless of their tech choices. Five foundational members of MICSA include: myEvidence: Allows law enforcement officers to capture crime scene information digitally. Makers Empire: 3D printing software developed specifically for primary schools and tested extensively by classroom teachers and students. Lend A Skilled Hand (LASH): A social enterprise that connects skilled volunteers with local and international community projects in need of their expertise. Codies: An interactive learning platform that uses Kinect for Windows Devices and in 2014 developed its first education motion sensing application. Jemsoft: Developers of a world-leading intelligent access control system called Portcullis. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
It’s long been the debate that has divided a nation. On one side is a settlement founded by convicts, and on the other, a once illegal colony founded by gold miners. It’s the battle between the cozzies and bathers. The scallops and the potato cakes. Rugby league and Aussie rules. Australia’s international city against the sporting/arts/coffee capital of the cosmos. The long “a” in Newcastle against the short “a” of Castlemaine. The battle of city buses and double decker trains against bunched up trams and limited express Metro services to Flinders Street via the City Loop. (That last one is a battle over which system is the least unreliable.) With the inevitability of someone tumbling head-first down a slippery dip – or should that be a slide – the debate has crossed into startup land. Which end of the Hume Highway (for those of you south of the border, that’s the Hume Freeway) is to become Australia’s Silicon Valley? North of the Murray, along poorly laid out streets in a state of perpetual traffic jam, the consensus is the city that is home to Fishburners and BlueChilli should become Australia’s Silicon Valley. Meanwhile, on the other side of The Alps (or as the locals say it, “Theelps”), Melburnians sit in their alleyways, sipping Magic Coffees chatting about how the laneways between York Butter Factory and Inspire9 are the natural home for this nation’s Silicon Valley. So which end of the great Hume power corridor should be home to Australia’s startups? North or South of the Murray? Well, your loyal correspondent, from a corner of the hills known as Parts Unknown, says both sides of this argument need to wake up to themselves! When it comes to highly scalable tech-enabled businesses, the NBN is a great leveller. Mix in AWS, the Google Cloud Platform or Microsoft Azure and there’s no reason why the next big thing in tech can’t launch from nearly anywhere in the country. Indeed, from Joondalup to Geelong, Wollongong to Toowoomba and Bega to Cairns, startup scenes are booming in this nation’s regional cities. With Skype and Google Hangouts, there’s simply no reason why rural or regional startups can’t participate in most events hosted in the big city coworking spaces, or why conferences shouldn’t be uploaded to YouTube after the event. And that’s without even mentioning the vibrant tech communities built around Startup Tasmania, SpaceCubed in Perth, iLab in Brisbane, Entry 29 in Canberra or Majoran in Adelaide. Now, Sonny Jim Crockett, your dear Old Taskmaster says the Melburnians and Sydneysiders really need to get over themselves and realise there’s far more to this great nation than their two cities! Kids these days – they want the whole toy chest to themselves, but then they run out of juice before teatime and then there’s tears! No, if Australia wants world class innovation, we don’t need to be a Silicon Valley – we need to become a Startup Nation! So do you have a great startup idea? Forget about the Melbourne-Sydney rivalry – start from where you are! Get it done – across Australia – today! P.S. They’re not potato cakes or scallops because they’re neither a cake nor a form of seafood – they’re really potato fritters! Follow StartupSmart on Facebook, Twitter, and LinkedIn.
YouTube has launched a platform for children with the aim of making it safer and easier for pre-schoolers to find fun and educational videos online. The family-focused app, which is currently available on the Google Play and Apple stores in the US, also allows parents to limit their kids’ screen time and search settings. YouTube’s kids group product manager, Shimrit Ben-Yair, said in a statement the new app will allow children to search for everything from maths tutorials to how to build a model volcano. “For years, families have come to YouTube, watching countless hours of videos on all kinds of topics,” she said. “Now, parents can rest a little easier knowing that videos in the YouTube Kids app are narrowed down to content appropriate for kids.” Microsoft allows third-party developers for its fitness wearable Microsoft today announced updates to its Microsoft Band and Microsoft Health apps, meaning third party developers are now able to create apps for the company’s fitness wearable. Matt Barlow, general manager of new devices marketing at Microsoft, said in a statement the updates were made in response to customer feedback. “This feedback is at the heart of the decisions we make, and today we’re pleased to take our first steps in launching new features and functionality for Microsoft Band and Microsoft Health that address what we’re hearing,” he said. The update was released today and will roll out on Windows Phone, iOS and Android devices in the coming days. Facebook data protection practices questioned: report Facebook’s data protection practices have come under fire in a report commissioned by Belgium’s data protection authority. The report examines Facebook’s privacy policies and, in particular, slam’s the social network’s approach to “freely-given”, “informed” and “unambiguous consent” when it comes to customer data. “Given the limited information Facebook provides and the absence of meaningful choice with regard to certain processing operations, it is highly questionable whether Facebook’s current approach satisfies these requirements,” the report reads. A Facebook spokesperson told TechCrunch the company recently updated its terms and policies to make them “more clear and concise” in order to reflect new product features. “We’re confident the updates comply with applicable laws,” they said. “As a company with international headquarters in Dublin, we routinely review product and policy updates including this one with our regulator, the Irish Data Protection Commissioner, who oversees our compliance with the EU Data Protection Directive as implemented under Irish law.” The report comes as the European Union is in the process of updating its data protection directive, which was made in 1995. Overnight The Dow Jones Industrial Average is down 0.14%, rising 25.01 points to 18,115.43. The Aussie dollar is currently trading at 78.03 US cents. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Hardly a week goes by without a new social media platform launching, with one Melbourne founder suggesting social media startups need to carve out a niche if they are to survive in such a highly competitive environment. With this in mind, StartupSmart rounded up five Australian social media startups we think you should keep an eye on in 2015. 1. Nabo Sydney-based startup Nabo is a social networking platform for neighbours. The idea is to bring people in the same suburb together online so they can organise play dates for their children or even have their goldfish babysat while they’re on holiday. The startup has secured $2.25 million in funding from Seven West Media and Reinventure Group, and launched nationally in December last year. 2. Vent Complaints have always thrived online. However, a Melbourne startup is looking to collate them in the one place and allow people to be supported by others if they need to get something off their chest and don’t want to pollute their Facebook or Twitter feeds. Vent has grown into a community of more than 10,000 users and to date the startup has raised $100,000 in funding. 3. TalkLife Talk Life is a mobile phone app and social network designed to host important conversations about mental health that people might not necessarily wish to talk about on a general platform or share with family and friends. The Adelaide startup’s founder, Jamie Druitt, has received support from London’s Bethnal Green Ventures and is collaborating with Microsoft Research and the Massachusetts Institute of Technology in order to analyse real-time user data to predict high-risk mental health episodes in young people. 4. Mothers Groupie Social network Mothers Groupie aims to reduce the isolation felt by young mothers by helping them meet face-to-face and talk to each other online. The site allows people to create or join groups based on a location – such as Melbourne’s inner northern suburbs – as well as other factors such as “young mums” or “new mums”. The platform also features a directory of “helpers” such as babysitters, cleaners and sleep consultants. Mothers can also post their own job ads and the startup is looking to expand into the US. 5. Mineler Mineler is a professional social network for people who work in the mining industry. Based in Perth, the platform allows people to bid for work and contracts as well as connect with others in the mining industry. The startup currently has more than 60,000 members as far away as Colombia and Canada, and has raised $500,000 in seed funding. Follow StartupSmart on Facebook, Twitter and LinkedIn.
Many tech workers and entrepreneurs leave Australia for Silicon Valley, and while for many it’s not the end game, employee share option scheme reform is key to luring them back, according to Xero managing director Chris Ridd. The Australian Consulate-General in San Francisco estimates more than 22,000 Australians are working in the United States and the Valley in particular. Ridd can relate. About 20 years ago when working for a large multinational he had the opportunity to leave Australia and work in Silicon Valley, but would eventually return and is now based in Melbourne. “I think it would be a shame if we had a situation where great talent in Australia and New Zealand felt they had to go to Silicon Valley to pursue career goals and get traction with an idea. But the reality is a lot go over there and come back,” Ridd says. “From my perspective and a lot of people I talk to (that move abroad), the US is not the end game but can be part of furthering your career. But Australia is a cool place to live and we’ve got a lot of innovation here. “So you can pick up some great skills and experiences and bring that back, that would be my hope.” That said, there must be incentive for talent to return to Australia and a big part of that relies on employee share option scheme legislation reform. The startup industry has been lobbying for some time for the government to roll back changes made to the legislation in 2009 which made employee share option schemes essentially unworkable for startups. The government has since promised to introduce new legislation, but has been criticised by Freelancer CEO Matt Barrie and Atlassian founder Mike Cannon-Brookes as it would only apply to companies with less than $50 million turnover. Ridd says when he moved from Microsoft to take a job at Xero, a big part of the appeal was the New Zealand-based company was able to offer an employee share scheme. “I took a 50% pay cut when I joined Xero. What got me on board was the act that they were able to offer equity. Equity is a huge value proposition when you’re in startup mode,” he says. “The only option you have at your disposal to attract people from large corporates that have a lot of experience is to offer equity, and to put a tax regime on top of that, that makes it less attractive is insane.” Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Melbourne-based startup CliniCloud is merging the Internet of Things and home healthcare to help doctors provide accurate diagnoses. CliniCloud’s kit, which launched pre orders recently, includes a digital stethoscope and a non-contact thermometer, both of which are linked to a smartphone app. Users can then monitor and record readings taken, and show those readings to their doctors when they get the chance to see them. The startup began as StethoCloud, a student project which finished runner-up in Microsoft's 2012 Imagine Cup Grants program. Originally the idea was to develop a product that could help diagnose childhood pneumonia in developing countries. But after using its $75,000 grant from Microsoft to test a prototype, co-founder Hon Weng Chong says it began to become clear there was demand for such a product amongst everyday consumers, particularly parents. His time working as a doctor in emergency departments, particularly the time he spent at Warragul Hospital in East Gippsland and Rosebud on the Mornington Peninsula, helped him understand why. “I saw a lot of young families coming in, and a lot of the time they’d say ‘if only I could explain to you what happened at home',” he says. “We’re trying to help them do that with a stethoscope and thermometer. So if your child had a wheeze you could record it then and there, along with the temperature and bring it in.” The decision to package a stethoscope and thermometer together was a careful one. Chong says he and co-founder Andrew Lin wanted two devices that, when paired up, could give a doctor quite a bit of information to aid diagnosis. “At the time I saw a lot of respiratory conditions come through, asthma was the biggest one, and having the sounds captured from the stethoscope was very useful, but augmented even further with information if the child had had a fever at the time, was very valuable,” he says. In addition to the grant, CliniCloud raised funding from friends and family about a year ago, and also took funding from angel investors, which Chong described as a extended seed round. CliniCloud is aiming to ship its first kits by July, with demand being treated as a test for product-market fit. If it proves successful the plan is to target a retail launch in the United States. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Prepare to open your wallets, ladies and gentlemen: Microsoft has announced the release of an augmented reality (AR) headset called HoloLens. Although having been announced only a fortnight ago, tech media are already dreaming feverishly of the potential applications for such a device. Meanwhile, Microsoft’s own press images seem to promise a benign utopia replete with living room Minecraft games and attractive, tech-savvy white people. It might look rather like an excitingly chunky pair of wrap-around sunglasses, but Microsoft promises that it is entirely self-contained, with speakers, lens and CPU housed entirely within the chassis. Being substantially smaller than the Oculus Rift, and intended to be less invasive than Google’s much-maligned Glass, HoloLens provides perhaps the most credible attempt to introduce augmented reality into our homes. What is augmented reality anyway? Even though HoloLens is new, the idea of augmented reality is certainly not. First proposed by L. Frank Baum (author of the Wizard of Oz) in his 1901 novel The Master Key, AR has a long and illustrious history, at least in theory. But what is it, exactly? Augmented reality is a form of “mediated perception”: an AR device overlays a virtual world on the real one. It does this by taking a live video feed of the external world and then supplementing it with computer-generated sensory input. In this sense, it is unlike virtual reality, which entirely replaces the external world with a virtual one. Instead, AR embellishes the real world to make it more fun, clear or informative. Already there is a huge number of AR apps, most of which have been built for mobile devices. One such is Layar, which synchronises camera input with data from Google Maps in order to let you see the world with the digital marginalia built in. Meanwhile, games like Ingress enable smartphone users to win points and compete with other players by “hacking” with virtual nodes that are attached to real-world landmarks. In order to hack the node, they need to actually stand near the landmark, giving it a distinctly physical dimension. Some of these AR programs are genuinely remarkable, and carry with them the seeds of a changing paradigm. The new version of Google Translate, for example, can perform real-time spoken-word translation, as well as translating written words almost instantaneously. The Babel fish from The Hitchhiker’s Guide to the Galaxy gets one step closer. However, HoloLens provides you with something a little different. Unlike mobile phone apps and Google Glass, the sensory overlays provided by HoloLens are interactable digital objects. They don’t merely provide parenthetical or additional information about things in the world; instead, those objects serve to further populate the world around us. The futures of where we live and work If you’re interested in Microsoft’s vision of a future filled with digital objects then check out its publicity video: the promises may seem overwhelming (one might even say “unbelieveable”). According to Microsoft, with a liberal application of augmented reality, the home and office become deeply and richly interactive in a way that has been hitherto impossible. Objects are designed and tested on the fly. A single pinched finger or flicked wrist enlarges or crumples or dismisses instantly and organically. Meanwhile, entire classes of consumer items are rendered completely redundant, collapsed into HoloLens and products like it. If Microsoft realises the future it proposes, AR products will see televisions, gaming systems, music players, desktop computers and even cosmetic objects like wall art and decorative carpets consigned to the dustbin of history. We will no longer have a need for these physical objects; instead, they will be projected into our field of perception as strictly digital entities. To be clear: this is not a prediction on my part. Far be it from me to make predictions about the purchasing habits of other people (I can barely keep track of my own). This, however, appears to be Microsoft’s vision. Although varnished into a high gloss, what is perhaps most telling about its vision of the future is not what isnew, but more what is missing. Televisions, gaming consoles, paintings: these objects have no place in Microsoft’s future. The future of consumption If this outcome is realised, it seems obvious to expect radical shifts in manufacturing and other secondary industries. Already there have been murmurs of concern and excitement about the possible economic ramifications of cheap 3D printing, particularly with regards to what it means for the manufacture of simple items. If Microsoft is successful in killing off the television and other media apparatuses, we may well also see manufacturing shrink from the other end. If the HoloLens and products like it do supplant other consumer electronics, we will be witness to the slow, awful collapse of what is currently a highly speciated consumer landscape into a homogeneous field of kooky-looking headsets. However, even as manufacturing will be forced to grapple with greater decentralisation and greater automation, not to mention potential market erosion at both the top and bottom ends of the sector, those who create, market and sell entertainment content will almost certainly find AR technologies an enormous boon. Marketers and content producers will have a window into our habits and tastes, sharing material funded by consumer commitment to almost-negligible microtransactions. Meanwhile, consumers will almost certainly fight back. Already a great many web browsers come installed with native ad and pop-up blockers. Moreover, having tired of product placement in movies and the indignity of “advertorials” in magazines, several designers and developers are working on products that block ads in the real world. It seems fair to expect that this presages a subtle, extremely sophisticated arms race between those who consume content and those who produce it. The sky is not falling These developments might sound like the first stages of a miserable Gibsonian future, but there’s no need to panic just yet. Indeed, there’s plenty of reason to think that the widespread uptake of AR technologies will, on the whole, make life easier. However, just like the internet dramatically changed the way business is conducted (such as the slow demise of brick-and-mortar bookstores), it seems reasonable to expect that the spread of AR technologies will introduce its own difficulties. But we should not take our own predictions too seriously. After all, we’ve been privy to these kinds of statements before. People who visited Norman Bel Geddes' Futurama exhibit at the New York World’s Fair in 1939 were awarded a souvenir pin upon departure: “I have seen the future”. Now, with the benefit of hindsight, we can look back upon this claim, along with some of the more outlandish predictions made by our forebears (flying cars, robot servants, Jetsonian spaceflight, post-scarcity economics) with an indulgent smirk: chrome, finned cars and bakelite have swung seamlessly into fashionably kitsch; ill-fated relics of a future that never was. There is, of course, a lesson here. In our own era of social networking, genetically modified foodstuffs and tawdry capitalism, it behoves us to be a little cynical about the promises and drawbacks of an augmented reality, in much the same way that we mock the promises of the Atomic Era. Of course, I’d be lying if I said I weren’t excited. I am, and very much. There’s too much of the techno-utopian in me not to feel a subtle thrill that the future we’ve been promised is finally arriving. But nonetheless, I worry, and I reserve judgement. Not very much, granted, and not very loudly, but amid the excitement there is a subtle sense of disquiet, and the sly hint of a disdainful sneer. Follow StartupSmart on Facebook, Twitter, and LinkedIn. This article was originally published on The Conversation. Read the original article.
The final communique of the 2014 G20 Leaders’ Summit called for enhanced economic growth that could be achieved by the “promotion of competition, entrepreneurship and innovation”. There was also a call for strategies to reduce unemployment, particularly amongst youth, through the “encouragement of entrepreneurship”. This desire to stimulate economic and job growth via the application of entrepreneurship and innovation has been a common theme in government policy since at least the 1970s. The origins of this interest can be traced back to the report produced by Professor David Birch of MIT “The Job Generation Process” that was published in 1979. A key finding from this work was that job creation in the United States was not coming from large companies, but small independently owned businesses. It recommended that government policy should target indirect rather than direct strategies with a greater focus on the role of small firms. Fostering the growth of entrepreneurial ecosystems Over the past 35 years the level of government interest in entrepreneurship and small business development as potential solutions to flagging economic growth and rising unemployment has increased. It helped to spawn a new field of academic study and research. This trend was boosted by the success the iconic “technopreneurs”. Technology entrepreneurs such as Steve Jobs of Apple, Bill Gates of Microsoft, Jeff Bezos of Amazon, or Larry Page and Sergey Brin of Google have become the “poster children” of the entrepreneurship movement. One of the best known centres of high-tech entrepreneurial activity has been California’s Silicon Valley. Although it is not the only place in which innovation and enterprise have flourished, it has served as a role model for many governments seeking to stimulate economic growth. Today “science” or “technology” parks can be found scattered around the world. They usually follow a similar format, with universities and R&D centres co-located with the park, and venture financiers hovering nearby looking for deals. Most have been supported by government policy. What governments want is to replicate Silicon Valley and the formation and growth of what have been described as “entrepreneurial ecosystems”. However, despite significant investments by governments into such initiatives, their overall success rate is mixed. So what are “entrepreneurial ecosystems” and what role can government policy play in their formation and growth? This was a question addressed by the first White Paper in a series produced by the Small Enterprise Association of Australia and New Zealand (SEAANZ). The purpose of these papers is to help enhance understanding of what entrepreneurial ecosystems are, and to generate a more informed debate about their role in the stimulation economic growth and job creation. What is an entrepreneurial ecosystem? The concept of the “entrepreneurial ecosystem” can be traced back to the study of industry clustering and the development of National Innovation Systems that took place in the 1990s. However, the term was being used by management writers during the mid-2000s to describe the conditions that helped to bring people together and foster economic prosperity and wealth creation. In 2010 Professor Daniel Isenberg from Babson College published an article in the Harvard Business Review that helped to boost the awareness of the concept. The diagram below shows the nine major elements that are considered important to the generation of an entrepreneurial ecosystem. The focus of this first SEAANZ White Paper is on the role of government policy. Future White Papers will deal with the other eight elements. Isenberg outlined several “prescriptions” for the creation of an entrepreneurial ecosystem. The first prescription was to stop emulating Silicon Valley. Despite its success the Valley was formed by a unique set of circumstances and any attempt to replicate it in other places were unlikely to succeed. This led to a second prescription, which was to build the ecosystem on local conditions. Grow existing industries and build on their foundations, skills and capabilities rather than attempting to launch high-tech industries from scratch. The third prescription was the importance of engaging the private sector from the start. Here the role of government is indirect and one of a facilitator not a manager. In trying to shape the growth of such ecosystems attention should be given to the support of firms with high growth potential that can help to generate a “big win” early on. This is the opportunity for local success stories to become role models for others. However, care must be taken by governments not to try to pick winners or over engineer the system. High growth firms by nature are inherently risky and highly innovative firms are typically unique. As such there is no magic formula for their success. Helping such firms to succeed is more about removing obstacles to their growth such as anti-competitive cultures, unfair taxation on small firms, unnecessary “red tape” or lack of access to markets, skilled employees or investment capital. In seeking to help stimulate entrepreneurial high growth firms it is important, according to Isenberg, to avoid flooding the system with too much “easy money”. This can take the form of government grants and venture capital funds that are too easily obtained. What is important is to grow firms with strong root systems that can sustain their own growth as much as possible before seeking additional funding. Such firms should be financially sound; profitable and well managed, or their likely success rates will be low. The focus should be on encouraging sustainable, growth oriented and innovative firms not simply fostering more start-ups. Starting a new business is the easy part, successfully growing it is the challenge. What can government do to stimulate entrepreneurial ecosystems? The challenge for government policy is to develop policies that work, but avoid the temptation to try to effect change via direct intervention. A 2014 study of entrepreneurial ecosystems undertaken by Colin Mason from the University of Glasgow and Ross Brown from the University of St Andrews for the OECD, developed a set of general principles for government policy in the relation to these ecosystems. They contrast “traditional” versus “growth-oriented” policy approaches to enterprise development. The first of these approaches tends to focus on trying to grow the total number of firms via business start-up programs, venture capital financing and investment in R&D or technology transfer. This is a “pick the winner model” and can also include business or technology incubators, grants, tax incentives and support programs. Such programs are essentially transactional in nature. It is not that they are of no value, but they cannot guarantee success via such direct intervention. A “growth oriented” approach is more relational in nature. This focuses on the entrepreneurial leadership of these growth firms. It seeks to understand their networks and how to foster the expansion of such networks at the local, national and international level. The most important thing is the strategic intent of the team running the business. Firms seeking to grow need to be given help in linking up with customers, suppliers and other “actors” within the ecosystem who can provide resources. Government ministers can play a critical role in fostering enterprise and innovation. Their role is to direct the government departments and agencies to focus on the problem and develop effective policies. A minister who has a good understanding of what entrepreneurial ecosystems are, how they form and the role and limitations of government policy is well-placed to generate more effective outcomes. Key recommendations for government policy In summary, key recommendations for government policy in the fostering of entrepreneurial ecosystems are: Make the formation of entrepreneurial activity a government priority - The formulation of effective policy for entrepreneurial ecosystems requires the active involvement of Government Ministers working with senior public servants who act as ‘institutional entrepreneurs’ to shape and empower policies and programs. Ensure that government policy is broadly focused - Policy should be developed that is holistic and encompasses all components of the ecosystem rather than seeking to ‘cherry pick’ areas of special interest. Allow for natural growth not top-down solutions - Build from existing industries that have formed naturally within the region or country rather than seeking to generate new industries from green field sites. Ensure all industry sectors are considered not just high-tech - Encourage growth across all industry sectors including low, mid and high-tech firms. Provide leadership but delegate responsibility and ownership - Adopt a ‘top-down’ and ‘bottom-up’ approach devolving responsibility to local and regional authorities. Develop policy that addresses the needs of both the business and its management team - Recognise that small business policy is ‘transactional’ while entrepreneurship policy is ‘relational’ in nature. For more reading see: Mazzarol, T. (2014) Growing and sustaining entrepreneurial ecosystems: What they are and the role of government policy, White Paper WP01-2014, Small Enterprise Association of Australia and New Zealand (SEAANZ). Note: Tim Mazzarol is President of the Small Enterprise Association of Australia and New Zealand Ltd (SEAANZ). SEAANZ Ltd. is a not-for-profit organisation founded in 1987. It is dedicated to the advancement of research, education, policy and practice in small to medium enterprises. This article was originally published on The Conversation. Read the original article.
Crowdsourcing startup CrowdSourceHire is collaborating with Microsoft for the first time in order to run a competition showcasing how businesses can drive innovation by hiring programmers with original ideas. The Code4Goal Coding Challenge, which is sponsored by Microsoft and will take place in February, is for programmers looking to promote their coding skills as well as solve issues faces by Australian companies. Participants will be asked to develop a product that helps businesses sift through large volumes of resumes in order to help them save time and money – while at the same time assisting them in choosing the right candidate. The competition’s judges include Shaun Clowes, director of product growth and analytics at Atlassian, and Andrew Coates, developer evangelist at Microsoft. The winner will be selected based on speed, accuracy, the cleanliness of their code as well as how innovative their solution is. Co-founder of CrowdSourceHire, Des Hang, told StartupSmart the competition was about “identifying and providing a solution” for a problem faced by large companies. “It’s also about promoting how you come up with a logical implementation to a solution – and that’s the part that is important for coding,” he says. “At the end of the day you can always take a course and learn how to code. But if you want to be a good coder you need that experience to plug in your skills.” Hang says he also hopes a few participants will get hired due to their work or at least build some strong connections with companies interested in being innovative. “Raising the candidates’ profiles will be the whole outcome of this,” he says. “We hope to help people in their career projection as well as any opportunities they may have as well.” CrowdSourcedHire is currently taking part in the Telstra-backed Muru-D program. Hang says the startup is currently in talks with Grabtaxi, an Asian-based company that uses taxis instead of private drivers and is looking at taking on Uber. “We’ve engaged with a couple of Telstra business units and engaged with a big startup – Grabtaxi – in south-east Asia. They are ramping up their hires and they want to use us to help them with that.” CrowdSourcedHire uses crowdsourced industry experts to assess prospective hires for startups and other businesses that may not have the infrastructure in place to adequately vet candidates. Registration for the Code4Goal Coding Challenge is currently open, with submissions closing on 2 February. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
With the recent acquisition by Facebook of voice-recognition company Wit.ai, all four major players in the post-PC market (Apple, Google, Microsoft and Facebook) now have a significant infrastructure for hands-free communication with your device. But what will that mean for our communication with our devices? Is voice just another method to talk to your computer, or are we on the cusp of a revolution in computer communication? How old is your keyboard, anyway? The humble computer mouse was created in the 1960s by engineer Doug Engelbart. The keyboard, through its ancestor the teleprinter, is even older, having been developed in the 1900s by mechanical engineer Charles Krum and connected to a video display terminal that owes its ancestry to a device developed in the 1930s. Despite the age of these devices, they still remain the main input devices for your personal computer on your desk or laptop. Sure, they have more buttons, or more colours, or higher resolution, but the basic input mechanism for the average home computer is the same now as it was in 1984 when the Macintosh became the first commercially available computer to provide a graphical user interface and mouse and keyboard input. Even the multi-touch screen, made famous by the iPhone and other devices in 2007, could be considered a direct descendant of the mouse, simply moving control of the pointer from an indirect method on your desk to a more direct method on the screen. But perhaps that is all about to change, with voice-recognition technology finally becoming important to the main players and other technology changing the way we interact with computers. Your voice is your password to a world of possibilities Like the mouse and keyboard, voice-recognition technology has been around for a number of years. Commercial voice-recognition software has been available for computers since the early 1990s. But it was only with the advent of technologies such as Apple’s Siri and Google’s Voice Search around 2010 that voice recognition became part of many people’s lives. Through a natural language, context-aware interface that is always connected to the Internet, technologies such as Siri allow users to address a vast range of needs while skipping touching their device altogether. Instead, they rely on their voice to set timers, check the weather, find movie times and even query where to hide a body. In 2014, Microsoft introduced Cortana, a Siri-like competitor, meaning that all three leading smartphone platforms had voice recognition. Also in 2014, Apple introduced the “Hey Siri” feature in iOS 8, allowing users to “hail” a smartphone from across the room (as long as it’s plugged in) and ask it a question without touching any buttons at all. Finally, in 2012 Google released Google Now, an extension to Google Voice Search that provides users with contextual information prior to them requesting it, such as providing traffic information as you leave the office or a list of good restaurants to eat at when you arrive in a new town. And it’s widely rumoured that both Google and Apple have plans for voice-recognition technology in their television products as well. While these solutions sometimes have a way to go (John Malkovich surely remains the only person in history to get Siri to correctly interpret “Linguica”), they present a starkly different view from the mouse-keyboard combination of old. It surely won’t be long before users can have a standard conversation with their device, talking it through a problem rather than frantically tapping the on-screen keyboard or clicking the mouse. Blending the digital and the physical world The revolution extends beyond our voice to other devices as well. It would appear that along with replacing old-fashioned input devices, output devices like the monitor are slowly being phased out. Earlier this year, before it acquired Wit.ai, Facebook made news for acquiring pioneering virtually reality company, Oculus VR for a staggering $US2.3 billion. The major product of Oculus VR is the Oculus Rift, a virtual reality headset that immerses you fully in a 3D virtual experience. Using positional sensors, the Oculus Rift can track your head movements to allow you to look around the environment. The device is still in development. Given the cost of the development kit at around $A400, it’s expected that the final product will retail for less than $A500, bringing virtual reality to the everyday consumer. Even if you don’t want full immersion, new output products are making it easier for us to step in and out of a digital world without needing a computer monitor. Google Glass, still in development but having been in beta for a number of years, provides a small display that you can view while wearing the glasses. Products such as the new Android Wear watches from Motorola and others, as well as the Pebble smartwatch and upcoming Apple Watch, provide us with small, customised views into the digital world. These can all put notifications, music control, sleep and activity monitoring and all the power of those voice-control systems literally at our fingertips, all without the need to use a full input or output device. Even in your car, Android Auto and Apple’s CarPlay provide a glanceable, touchscreen and voice-controlled interface to your smartphone to ensure you’re always connected to the cloud. Sensors everywhere Beyond these standard options, input devices and data-gathering devices are continuing to pop up in places that we don’t expect, making it easier to interact with your devices and control your digital world. At the Consumer Electronic Show (CES) this year, gadgets using Bluetooth Low Energy for communication with your home network abound, from a smart chair that helps you work out to a pot for your plants that monitors their vitals and allows you to apply water with a touch of a button. These add to items from the last year such as the connected toothbrush that monitors your brushing time and style and reports on how you’re doing and the Vessyl cup, a smart cup that can tell you the calorie and caffeine content of your beverages as well as keep track of your daily water intake. No longer are we tied to our keyboard and mouse to look up and record this data. Our devices will now do it for us automatically and let us know when something needs to be changed. This trend towards the Internet of Things has been brewing for a number of years, but if the CES is any indication, this year shows a real explosion in external input devices that collect data about us and feed it into the cloud. It will be interesting to see what the future brings. It could be argued that the new ways of communicating with your computer are already here, although just beginning. As the year progresses and these models mature, perhaps it won’t be long before we are speaking to our device using natural language while wearing a VR headset and being instantly alerted about the status of our plants and how much activity, sleep and caffeine we’ve had so far today. With all of these solutions, perhaps finally the old mouse and keyboard are looking mighty old-fashioned. This article was originally published on The Conversation. Read the original article.
Facebook has begun trials of its Facebook at Work service, a cloud-based platform that allows business to create social networks for staff, with the project led by an engineer who launched one of Sydney’s most successful startups. Development on the project is being led by Lars Rasmussen, who was the cofounder of a Sydney-based mapping startup called Where 2 Technologies that was subsequently acquired by Google and rebranded as Google Maps. After his success with Google Maps, Rasmussen went on to lead the development of Google’s ill-fated Google Wave project, which was intended as a real-time collaborative document editing platform. TechCrunch reports an app for Facebook at Work has appeared on the iTunes app store, with an Android version set to go live shortly and another version accessible through the Facebook’s website. News of the service first leaked in November last year. Facebook at Work will also give employees the option of either using a single login for both their work and personal accounts, or the ability to keep both separate. Facebook at Work is set to compete against collaboration platforms such as Microsoft’s Yammer. Microsoft announced it is combining its business-focused Lync video conferencing and instant messaging app with Skype to create a new package called Skype for Business late last year. This story originally appeared on SmartCompany.
It’s been a big year for the Australian startup ecosystem. Success stories like Atlassian and Campaign Monitor continue to go from strength to strength and the ecosystem is growing. According to the Australian Private Equity and Venture Capital Association the 2014 financial year saw the highest level of venture capital activity in dollar terms over the last 10 years. That uptick was despite “tough fundraising conditions” and the federal government’s termination of the Innovation Investment Fund weighing on local venture capital activity. Here are some of the startups that contributed to the ecosystem’s success and caught StartupSmart’s eye over the past year. In no particular order: 1. Eyenaemia What better way to begin than with a startup that literally wants to save people’s lives. Anaemia, a deficiency in the number or quality of red blood cells, currently affects an estimated two billion people worldwide, including 293 million. It is the cause of 20% of maternal deaths every year. It’s an easily treatable condition but is often symptomless. If left untreated it can lead to serious complications. Eyenaemia has developed a simple non-invasive treatment, which allows anaemia to be diagnosed through a mobile app, and a quick selfie. They won the Microsoft Imagine Cup, and are currently conducting large scale field tests to confirm their solution works. 2. Canva Sydney-based design startup Canva’s goal is no less ambitious – it wants to “democratise design”. This year it rolled out its design marketplace, which allows professional designers to contribute layouts and earn royalties every time their designs are purchased. Perhaps most significantly, it also signed up Apple’s original Mac evangelist, Guy Kawasaki, as its chief evangelist. 3. Scriptrock Startmate graduate ScriptRock, an Australian IT DevOps company, raised $9.8 million in a Series A round, led by August Capital. Also participating in the round were Peter Thiel’s Valar Ventures, and Square Peg Capital. As of August, less than 12 months after launch it had signed up 600 customers and is looking to scale up growth. 4. CoinJar Australia’s leading bitcoin startup left Melbourne, setting up its headquarters in London, a city competing with Australia to be the world’s leading fin tech startup location. The relocation is part of the startup’s grand plan to expand into Europe. It also released Australia’s first bitcoin debit card, which enables bitcoin to be used to pay for goods and services anywhere where debit cards are accepted. If (when) digital currency becomes mainstream in Australia, there’s a good chance CoinJar will have had a lot to do with it. 5. Invoice2go Invoicing app startup Invoice2go was one of Australia’s big startup success stories of 2014. Founded by Chris Strode in 2002, in 2014 the startup raised $35 million led by Accel Partners and supported by Ribbit Capital. It’s got serious traction in the form of 120,000 customers and is looking a potential market of 100 million. 6. LIFX After holding one of Australia’s most successful kickstarter campaigns, smart lightbulb maker LIFX took out the top award for smart systems in the consumer goods category at the 2014 Edison Awards. It then partnered with Sequoia Capital and raised $12 million in Series A funding. It wasn’t without setbacks, however, after concerns emerged that its light bulbs could be hacked, leading to debate about the security of IoT devices. 7. VentureCrowd Australia’s first equity-based crowdfunding platform, VentureCrowd helped facilitate the raises of two companies, opening up a new way for startups to raise capital. Transportation network and mobile payments startup ingogo used VentureCrowd to raise $1.2 million of a $9.1 million raise in September. It then helped fashion startup Fame and Partners raise $50,000 of a larger undisclosed funding round. With regulation that will open up equity crowdfunding to retail investors expected to arrive mid next year, these two deals look like just the first of many. 8. OneShift Online recruitment platform OneShift has grown to service 400,000 job seekers and 35,000 businesses. The platform, which founder Gen George describes as a “dating website for jobseekers”, matches employees with businesses looking for anything from one-off shifts, causal work, or permanent employment. The startup impressed Reddit co-founder Steve Huffman at a pitch session at Above All Human in Melbourne earlier this month. 9. That Startup Show The web-series produced in Melbourne wasn’t even a startup when it launched. Since the pilot episode launched on YouTube in August, the series has attracted more than 110,000 viewers across Australia, Europe, Asia, Canada and the United States. It secured angel funding from Alan Jones and technology foundry Digital4ge and completed filming its first season. Co-founder Ahmed Salama says the vision for That Startup Show is to provide a voice for startups not just in Australia but around the world. It’s also been negotiating with a number of possible distributors, including TV networks. 10. Shoes of Prey The Sydney-based online retailer is taking on the world. Earlier this month it raised $6.5 million from US-based Khosla Ventures in December. Those funds will be used to finance its bricks-and-mortar expansion in markets, including the United States. It’s already opened an office in New York and will be available in Nordstrom stores in Seattle, Washington, California, New Jersey, Illinois and New York. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
A year ago, SmartCompany listed the top new technologies set to race into 2014. Well, another year has come and gone, and a new group of technologies are emerging over the horizon. So what new technologies should you look out for in 2015? It’s time to gaze again into the crystal ball and take a look at six technologies you should keep an eye on in 2015: 1. Make-or-break time for smartwatches Over the past year, both in the form of devices running Google’s Android Wear platform and the Apple Watch, the tech giants have made big bets on smartwatches. However, so far consumers have been a bit ambivalent. Sure, smartwatches can bring notifications to your clockface and apps on your wrist, and being able to do a voice search with Google without pulling out your phone or tablet is nifty. On the other hand, a majority of the people inhabiting the planet already carry a far more powerful device with a larger screen in their pocket or handbag, in the form of a smartphone. So the real question now is whether consumers will embrace this new technology. Over the next year, entrepreneurs and innovators will either come up with a “killer app” for the smartwatch that drives it into the mainstream, or else the technology will be remembered as a flash-in-the-pan tech fad. Either way, the next 12 months will be crucial to the long-term prospects of this much-hyped technology. 2. Mobile payments and tickets Another technology rapidly approaching the critical make-or-break point is mobile payments. These days, from “touch and go” chip-and-pin credit cards to public transport tickets, there are a growing number of smartcards that are based on a technology called near-field communications (NFC). Over recent years, a growing number of smartphones have embedded these chips, allowing the “tap to share” features on Samsung Galaxy and Microsoft Lumia smartphones. NFC technology received a surge of mainstream attention with its inclusion on iPhone 6, which uses the chip as part of its Apple Pay payment platform. Of course, the great thing about NFC is that you don’t need to be tied into a proprietary walled garden platform such as Apple Pay. Potentially, all of the smartcards in your wallet could potentially be replaced with an app on a smartphone with an NFC chip. Since we’re now at the point where just about every flagship smartphone has NFC, we’re also at the point where it’s plausible for consumers to replace a wallet full of cards with a phone full of apps. Whether consumers embrace the convenience over the next year will be interesting to watch. 3. Multi-device app development The number of tech gadgets on offer to consumers is greater than ever before. A couple of decades ago, the average consumer just had a desktop or laptop in their study at home, and a second on their work desk. Today, a consumer could potentially use a smartwatch, a smartphone, a tablet, a desktop or laptop computer, a smart TV (or a set-top box or games console) and an in-car entertainment system in the course of a single day – and all of them run apps. Where Apple, Google and Microsoft once created operating systems for single devices, they’re now creating app platforms and ecosystems for devices. With Mac OS X Yosemite and iOS 8, Apple added a feature called Handoff that allows users to pass activities from one device to another. With Windows 10, Microsoft will allow a single app to run across a range of devices, including everything from smartphones and tablets to Xbox game consoles, PCs and servers. Meanwhile, with 5.0 Lollipop, Android apps can now run on Chromebooks. Not only that, but Google has created a range of versions of Android for different devices, including cars (Android Auto), wearables (Android Wear), and TVs (Android TV). For businesses, what this means is that consumers are likely to increasingly expect their apps, websites and online services to work seamlessly across a range of different devices and contexts. 4. Health tech The interesting thing about many of these devices is they have potential therapeutic benefits for people with otherwise debilitating medical conditions. Others could be used as a preventative tool to warn users about possible health risks. For example, Google Glass can potentially overlay graphics for people with poor vision highlighting potential risks and dangers. Cloud platforms can be used to collate health records and readings from a range of different devices and sources. Robotics can be applied to help people with limited mobility carry out everyday tasks. The great news is that there are a range of Australian businesses already doing some great research in this area. A great example is Eyenaemia, a new technology, developed by Melbourne medical students Jarrel Seah and Jennifer Tang, which allows users to diagnose anaemia by taking selfies with their smartphones. The technology has grabbed the attention of none other than Microsoft co-founder Bill Gates himself. “I could see a future version for Eyenaemia being used in developing countries, especially with pregnant women, since anaemia contributes to nearly 20% of deaths during pregnancy,” Gates says. As of August, a health-tech startup group in Melbourne has already managed to attract close to 1000 entrepreneurs and medical professionals to some of its meetings, and a similar group in Brisbane is attracting around 100. Health tech is an area Australia could become a world leader in over the coming years – if the investment and political will is there. 5. Plastic OLED displays A year ago, low production yields put a limit to the production volumes of curved or flexible screen devices. The first curved screen displays appeared on smartphones such as Samsung’s Galaxy Round and the LG G Flex, and at some curved-screen TVs at the International CES trade show. However, prices were high and volumes were limited. It required specialist types of glass, such as Corning’s bendable Willow Glass, to make. The situation is set to change over the coming year thanks to a new technology called called P-OLED (plastic-organic light emitting diode). P-OLED works by sandwiching a layer of organic material, which lights up on receiving an electrical charge, between two sheets of plastic. Along with the organic material, there’s a thin grid made up of a transparent material that conducts electricity (known as an active matrix) that can deliver a charge to each individual pixel. Unlike LCD displays, which require a backlight, all of the light is generated by the organic material, meaning P-OLED displays are thinner as well. It is also thinner than glass AMOLED displays. LG Display, one of the top three display manufacturers worldwide alongside Japan Display (Sony, Toshiba and Hitachi) and Samsung, says we should expect to see bendable tablets next year, with rollable TVs and foldable laptops screens in 2017. 6. Rise of the Chinese tech giants This last one is not so much a new technology, per se, as it is a potential tectonic shift in the tech industry landscape. During 2014, Xiaomi overtook Apple as China’s second-largest smartphone maker and – according to some figures – overtook Samsung as its largest. By the end of the year, it was the world’s third largest smartphone maker by volume, trailing only Samsung and Apple. But while Xiaomi attracted most of the attention, it’s far from the only Chinese electronics maker set to make an impact over the coming years. Lenovo became the world’s largest PC maker by buying IBM’s PC division in 2005, and has recently completed its purchase of Motorola from Google. Huawei, the world’s largest telecommunications equipment maker, is also making its consumer electronics play. In their shadows are a range of other brands, such as Coolpad and ZTE. But it’s not just device makers that are having an impact. Look no further than the record-setting $US231.4 billion ($A258.8 billion) IPO of Chinese e-commerce giant Alibaba. In conclusion From health tech to mobile payments, there are a range of technologies that will potentially have a big impact on Australian small businesses over the next year. But perhaps the most important thing for businesses will be to make sure your consumers have a seamless digital experience across all of them. This article originally appeared at SmartCompany.
The startup scene continues to flourish in Australia, with hundreds of new startups launching this year and many scaling nationally and overseas. Here is StartupSmart’s pick of some of the startups to keep an eye on in the new year. 1. Bitcoin Group Melbourne-based Bitcoin Group, the entity behind bitcoin arbitrage fund Bitcoins Reserve, has big plans for 2015. The company plans to raise $20 million at 20 cents a share by listing on the ASX. On top of that, the startup is a big supporter of the local bitcoin community. Chief financial officer Allan Guo previously told StartupSmart Bitcoin Group hopes to raise the profile of bitcoin in Australia and make sure more people understand digital currencies. “There are people building exchange platforms, as well as payment systems, wallets, all the technology, but for us we see the biggest problem with bitcoin is the lack of understanding, the lack of trust,” he says. “The transparency, the legitimacy, that’s what we want to bring.” 2. Swift Swift is a Melbourne startup that grew out of after-hours alcohol delivery service Liquorun, and allows retailers and other businesses to deliver their products to consumers within one hour. Swift is a classic example of an Aussie startup taking a niche concept and applying it to the broader market. “Shopping online is very convenient until it comes down to accepting delivery of the item,” founder Joel Macdonald previously told StartupSmart. “You know where you’re going to be in the next 60 minutes but you don’t necessarily know where you’re going to be the next day. Everyone’s time poor.” Swift was one of five companies to recently secure funding from BlueChilli’s $10 million venture capital fund and is in talks with a number of US retailers. 3. Stashd Fashion-discovery startup Stashd launched earlier this year and allows users to swipe left or right on an item depending depending on whether they would like to ‘stash’ or ‘trash’ it. The app features more than 100,000 items and users in more than 80 countries. Co-founder Jessica Wilson says 30% of the apps users are “power users” and have engaged with the app more than 100 times since downloading it. “I think a lot of it is you become super addicted to it,” she says. “Internationally we’ve grown well because it is different, and we’re one of the first people in the fashion app space.” Stashd has plans to grow the product range to include items from the likes of Zara, The Iconic and Asos.com. The startup will likely announce a seed investment round in the next few months. 4. Wattcost Aussie startup WattCost has developed a device that can be attached to a household’s power meter to provide home owners with real-time data on power usage. Former Microsoft evangelist Robert Scoble says WattCost was the most interesting startup he has seen all year and Google could very well buy the company in the race to become the dominant Internet of Things platform. “We don’t know who’s going to win, but Google’s in the early lead because they bought Revolv, they bought Dropcam and they bought Nest,” he says. “And I think this is going to be another one that they’re going to buy, because knowing how much electricity is going through the house, knowing when the rates are changing, that’s really important.” 5. TalkLife Global social network TalkLife was founded in Adelaide and this year announced a collaboration with a London-based business accelerator. The startup allows young people to discuss issues such as depression and suicide and support one another online. It has grown rapidly since its launch in 2012, with currently more than 100,000 users worldwide. Founder Jamie Druitt previously told StartupSmart the startup is working with Harvard and MIT research teams to investigate how data can be used to predict high-risk mental health episodes in young people. “I think it is fantastic that TalkLife can give them the opportunity to see data on mental health in real time,” he says. “I think we need to look at how we can grow TalkLife now – it has only ever grown organically but we’re not even scratching the surface of mental health. We’ve got a long, steep road ahead.” Follow StartupSmart on Facebook, Twitter, and LinkedIn.
An Australian startup leading the way in contactless communications has opened an office in New York as part of its expansion into the US market. Tapit, founded in 2011, has been finding new ways for consumers to access information instantly on their phones – all off the back of an aggressive international expansion. Earlier this year the startup collaborated with the likes of Google and HBO to allow people to access film and television-related content on their smartphones by scanning event posters. In September, Tapit entered the Chinese market via a partnership with mobile commerce giant 99 Wuxian. Co-founder and chief executive Jamie Conyngham told StartupSmart the company opened an office in New York because it wanted to position itself where its clients were. “There’s a concentration of media in New York and a lot of iconic brands have their global headquarters there, so it made more sense for us to relocate there rather than San Francisco,” he says. Conyngham says the startup has been using Australia as a “launchpad” for global deals, which has worked well because it can bring those case studies to the US. “If you do a deal with Google or Microsoft in Australia you have that case study and you can then go to their global teams,” he says. “You can’t do that unless you do those deals in the US – Skype only takes you so far.” The company has been helped by the fact that Australia is ahead with contactless communication in comparison to other countries, according to Conyngham. “You’ve seen the massive take-up of tap and pay with credit cards and that has put us ahead in the contactless ecosystem. So we’ve been lucky to have headquarters here in that regard because the US is a bit behind – even in the UK.” Tapit also has offices in Tokyo, Shanghai and Dubai. The fast-growing startup has pioneered contactless communications for brands such as Telstra, Vodafone, Coca-Cola, Samsung and Sony. There are around 635 million smartphones fitted with near-field communications technology around the world, and Tapit expects that number to grow to one billion by 2015. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
There is a lesson for us all in the continuing revelations from stolen Sony emails being splashed over world-wide media. It is a lesson that Sony Pictures Entertainment Co-Chairperson Amy Pascal could have benefited from before sending emails with racist comments about President Obama. Or an email calling Leonardo DiCaprio’s behaviour “Absolutely Despicable” when he decided to pull out of a planned Steve Jobs biopic. The lesson is a very simple one. It is that when you are writing an email (or any other corporate document), imagine that it will inevitably one day end up on the Internet for everyone to see. Even without the hacking episode, there have been enough horror stories of private emails being accidentally sent to the wrong people who have little issue with making the contents public. The emails of Amy Pascal and other Sony Pictures’ executives reveal damaging internal discussions about business practises and commentary on a wide range of people that the company relies on to do their business. It is hard to imagine how those involve retain their credibility as more of the emails become public. The dangers of emails being used against an organisation was something that former Microsoft CEO Bill Gates discovered the hard way during US antitrust investigations. After that point, Microsoft internally discussed a practice of not keeping any emails for longer than 6 months. In many other cases, emails have been obtained by journalists and others and used against the owners under Freedom of Information requests. Deleting emails after a set amount of time would have helped a great deal with Sony’s problems but it comes with its own issues. Many organisations, including universities, are subject to legal regulations governing how long official records need to be retained. Emails can be considered part of official records and so it is sometimes difficult to apply a blanket policy that requires all emails to be deleted after a relatively short time. The problem of email could also potentially be solved by using other forms of electronic communication instead. There have been suggestions that email could be replaced with instant messaging. This is certainly the case but many of these services keep records of conversations. Google for example, allows individual hangouts to be switched into “off the record” mode, but does not allow this setting as a default for all conversations. To delete the record of the conversation, it has to be done individually. Special software that automatically deletes conversations can be used such as messaging apps Telegram and OneOne but these require widespread use. In terms of the types of email exchanges that were highlighted in the Sony releases, it is unlikely that the participants would have had the presence of mind to use more secure communications in any event. Although companies should be advising all of their staff, especially the senior ones about good email hygiene, there is still a much easier way of avoiding all of these issues by not writing the email (or document) in the first place. If that is not possible, then there are a few definite things you should do when writing email: 1) Always keep it brief. The more you write, the harder it is to check you haven’t said something you will regret. 2) Never write email when you are angry or emotional. Leave it for 24 hours before writing, if at all. 3) Never write email when you have been drinking. 4) Never include personal, intolerant, or insensitive statements in corporate email. If it helps, it is also useful to imagine a prosecuting lawyer looking over your shoulder as you write every email you send. This article was originally published at The Conversation.