The election is over. The Coalition has won. Now what does it mean for Australia’s start-up sector? Unfortunately, it’s not entirely obvious. It’s something that’s been picked up on by members of the start-up community who are wondering what attention their industry will attract now that Australia has a new government. Dean McEvoy, who launched Australian group buying website Spreets.com.au, published on his blog an open letter to Coalition broadband spokesman Malcolm Turnbull last week highlighting the opportunity around start-ups that “at the moment nobody appears to own”. “There is an opportunity with the right incentives to inspire a generation of technology entrepreneurs,” he wrote. His letter was supported by other leaders in the start-up community, with Pollenizer co-founder Mick Liubinskas commenting that “supporting start-ups shows real leadership”. Blue Chilli co-founder Sebastien Eckersley-Maslin added: “Thanks for the open letter Dean and I agree that we have a golden opportunity to support the emerging economy and again draw attention to the report by PwC on the impact this industry can have on the Australian economy if the sufficient support is done correctly now.” At the Coalition’s e-government and digital economy policy last week, the policy document recognised that “policies encouraging innovation, funding research and providing incentives for entrepreneurs are very important over the medium term in developing a more sophisticated economic base”. In April this year, a report by PricewaterhouseCoopers, commissioned by Google, said Australia’s tech start-up sector had the potential to contribute $109 billion, or 4% of gross domestic product, to the Australian economy and 540,000 jobs by 2033 “with a concerted effort from entrepreneurs, educators, the government and corporate Australia”. The Coalition’s policy said that while a vibrant start-up community would be very encouraging, “there are limits to the capacity of governments to will this into existence, and, even if they could, it would not be material to the broader economy for years”. When StartupSmart asked Coalition communications spokesman Malcolm Turnbull’s spokesman for its policies relating to start-ups, we were referred to speeches Turnbull had made earlier in the year. Turnbull told the Kickstarter conference in February: “What we really have to do is to make sure we create an environment and some judicious support whether it is by way of R&D (research and development) concessions or supporting venture capitalists; we’ve got to make sure that what we are doing is really supporting you and your counterparts around Australia because you are the future of the industry.” He also said the Coalition was committed to making it easier for businesses to get on without excessive regulation and has pledged to cut the cost of red tape by at least $1 billion for each year it is in office. McEvoy suggested fixing tax laws that don’t incentivise people to take risks and be entrepreneurs and inhibit experienced people from helping start-ups. “The second and most important thing is to take ownership of this opportunity. Let it be known that you are aware of this opportunity and will sit down and help work out policies that make it thrive, not let this massive opportunity slip through the cracks,” McEvoy wrote. The start-up sector’s wishlist for the election included action on employee share scheme arrangements by making them simpler and their tax treatment more start-up friendly, more early stage funding available for start-ups, and a focus on educating more computer engineers. A review is underway into employee share schemes, with incoming Treasurer Joe Hockey saying in July that the Coalition would consider making changes. StartupSmart also asked a spokesman for Coalition industry and innovation spokeswoman Sophie Mirabella for a list of policies relating to the start-up sector, but didn’t receive a response. The Coalition has also pledged to protect medical research funding and provide “long-term” policy stability and that there needs to be better links between government, business and research institutions. With the election now over, and the business of governing now in the Coalition’s hands, the start-up community will be watching closely to see what changes, if any, come to help their sector.
Finding a co-founder is one of those things that can happen in an instant or it can take months of fruitless searching. While a lot of it depends on an entrepreneur’s networks and specific requirements, it seems there is also an element of luck involved, and not everyone is fortunate enough to find their co-founder in a chance meeting. Indeed, some entrepreneurs go to great lengths to find the perfect co-founder. Melbourne-based entrepreneur Marc Harrison offered a $2,000 bounty during his hunt for tech co-founders, while Sydneysider Ryan Wardell set up Cofounder Speed Date following his own struggle to find a sidekick. Even start-up powerhouses like Pollenizer have been known to put the feelers out for co-founders. Earlier this week, Pollenizer said it was seeking co-founders for four of its start-ups. And these start-ups aren’t duds either. One would involve a partnership with a Skype co-founder while the other would involve working with the former chief executive of CareerOne. It’s also worth noting an increasing number of accelerators have specific requirements regarding co-founders. In January, StartupSmart spoke to Australian start-up 7write.com about its struggle to find a third co-founder after being selected as a finalist for Startupbootcamp Amsterdam. On its website, Startupbootcamp Amsterdam says it prefers teams with three or more founders. “You can apply with two founders but to really accelerate your start-up we prefer a strong team of three people,” it says. Closer to home, Melbourne-based start-up accelerator AngelCube recently announced it won’t be taking on sole founders in future rounds. “I think we’ve learnt some lessons from the last round,” AngelCube co-founder Adrian Stone told StartupSmart in April. “We had too many sole founders and quickly realised being a sole founder is too much of a big task… [in a three-month program]. “[We realised] our program is not going to happen for a sole founder. We’re looking much more at teams. “I think what we’ve learnt is one founder is too few and four is too many. The jury’s out on whether two or three is right.” This means more start-ups are scrambling to find good talent, and find it fast. One entrepreneur facing this predicament is Tablo Publishing founder Ash Davies, who was named Best Young Entrepreneur at the 2013 StartupSmart Awards in March. Tablo Publishing helps authors publish their work from anywhere in the world and reach a global network of iBookstores. Davies, who has been accepted into the AngelCube program, told StartupSmart he is looking for a tech co-founder. “I am now four weeks into [the program] and working very hard and am at the point now where I could go a lot further if I had someone alongside me,” Davies says. “I’m looking for someone with great technical skills who can build applications but also someone with a strong sense of vision. “The biggest thing I’m looking for is someone who is able to learn fast.” Davies admits it is a tough process. “It’s like dating. You’ve got to match the personality as much as the skills,” he says. So how does one find a co-founder? StartupSmart spoke to Pollenizer co-founder Mick Liubinskas to determine what’s involved. Show your face Liubinskas says Australian start-ups don’t have the luxury of waiting for the right person to present themselves, so if you need a co-founder you have to make it happen. “Being in Australia we don’t have what the Valley or Israel have, where you can find lots and lots of co-founders waiting to take the risk,” he says. “The challenge is talented people who won’t take the risk or people who will take the risk but aren’t talented. “You want to find someone who’s so good they could possibly do it by themselves. The thing I encourage people to do is go to as many events as possible.” Conduct a trial “Say to people, ‘Hey, when we have a cup of coffee let’s sketch out one idea’,” Liubinskas says. “Try to work together as quickly as you can but don’t make [the project] so small that people can give it up easily. Be very aware that’s not going to give you [what you need].” Make them an offer “You have to have a clear idea and pitch it very strongly. Be specific about what you do and drive it as much as you can. You also need to put out an attractive offer,” Liubinskas says. “If you’re a non-technical person who’s really trying to get started, you may have to give them more equity. “You also need to make sure any equity is vested and that should apply to you as well. At Pollenizer, everyone’s equity for effort is earned over time.” Do as much as you can beforehand Finding any kind of co-founder is difficult, says Liubinskas, but finding a tech co-founder is particularly tricky because they are in such high demand and therefore receive lots of offers. In this situation, Liubinskas says entrepreneurs should attempt to do as much of the work as they can on their own. “Good entrepreneurs will always find a way and that’s part of the fun,” he says. “There are a lot of platforms where you can do manual testing without building a product. Once you actually start building, everything can actually slow down. “The more progress you can make in building a product, the more attractive it’s going to be for a co-founder and the easier it is for them to know what they need to build.” Take your time While it can be tempting to hire the first person who looks your way, Liubinskas says entrepreneurs must ensure the co-founder they choose is the right one for their start-up. “It’s tough with so much competition around… Do it slowly and carefully rather than doing it recklessly – that’s the main thing,” he says.
Pollenizer is looking for co-founders for four of its start-ups, one of which would involve a partnership with a Skype co-founder while another would involve working with the former chief executive of CareerOne. According to Pollenizer co-founder Phil Morle, all four businesses need “gutsy entrepreneurs with the audacity to believe that they can pull off a global business with limited resources”. The businesses are as follows: Fitbit for your house – collaborating with your social network to use energy more effectively. This is a partnership with one of the Skype co-founders. “This is a brand new idea so they’re looking for co-founders from scratch,” Pollenizer co-founder Mick Liubinskas told StartupSmart. Social Powered Retail – using social networks to increase sales. This would involve working across south-east Asia as well as Australia. “Social Powered Retail is Gyft… The co-founders took it as far as they could and we’re now looking for a new set of co-founders to go where the business needs to go,” Liubinskas says. 99designs for recruitment – crowdsourcing new hires. This would involve working with the former chief executive of CareerOne. “The recruitment business is looking for more co-founders; more engineering talent,” Liubinskas says. SasS for coaches – customer relationship management, session management and other tools for business coaches, consultants and mentors. “SaaS for coaches is Coachy, which has a lot of great potential customers… We need an entrepreneurial engineer who is longing for some B2B experience,” Liubinskas says. At this stage, Pollenizer has declined to reveal the names of the Skype co-founder and former CareerOne chief executive. But according to Morle, co-founders are paid a “modest salary with great equity”. “We will train you in lean start-up skills – if you don’t already have them – and mainline you into an amazing network of entrepreneurs and investors,” he says. Liubinskas, however, is quick to point out the Pollenizer environment is not for everyone. “A lot of people who come from the corporate world, where they ran a really large company, will say that it’s the same as running a small company, which it definitely isn’t,” he says. “Some people can make that transition but a lot of people can’t. The other thing is completely green people. “[You must also have] a willingness to share… Really the key to that for me is people in the same location. “I vowed I would never, ever do another start-up where the whole team is not in the same room. Some people can do it but it makes life harder.” Liubinskas says anyone who joins the Pollenizer family must be open to change. “Start-ups change every day. Even the businesses we’ve learned a lot about, they’ll continue to change. Not a single successful Pollenizer start-up is the same idea it started with,” he says. “You also need to not be precious. You need to be thick-skinned to deal with a whole bunch of failure along the way.”
Melbourne-based start-up accelerator AngelCube has made several small changes to its program, including distancing itself from start-ups with sole founders, after opening applications for 2013. AngelCube, named Best Start-up Investor at the 2013 StartupSmart Awards, offers seed capital, mentorship, connections and opportunities to web start-ups. Applications for the 2013 program will close next week on April 12. Once applications have closed, 20 finalists will be chosen to pitch to a selection panel of high-profile tech players. From those 20, AngelCube will select eight start-ups to participate. The program is completed over a three-month period, after which the start-ups head to the United States to pitch to a roomful of investors. There are a number of noteworthy start-ups in the AngelCube fold, including Kickfolio, which raised $100,000 from US investors before being accepted into US-based accelerator 500 Startups. Kickfolio is now closing a Series A funding round. Other AngelCube success stories include LIFX, Broccol-e-games and shopping recommendation engine Giveable, which has raised $150,000. According to AngelCube co-founder Adrian Stone, about half of AngelCube’s graduate companies go on to raise follow-on funding from Australian and overseas investors within six months of completing the program. Successful applicants for this year’s program will receive $20,000 in seed funding, six months of free desk space and access to a group of more than 50 mentors. Mentors include RetailMeNot founders Guy King and Bevan Clark, Pollenizer co-founder Mick Luibinskas and Nic Hodges of MediaComm. Stone told StartupSmart AngelCube will be doing a few things differently this year. “I think we’ve learnt some lessons from the last round,” Stone says. “We had too many sole founders and quickly realised being a sole founder is too much of a big task… [in a three-month program],” he says. “[We realised] our program is not going to happen for a sole founder. We’re looking much more at teams. “I think what we’ve learnt is one founder is too few and four is too many. The jury’s out on whether two or three is right.” Stone also admits the net needs to be cast a little wider this year. “A lot of the ideas were probably too small [last year]. They focused on a niche market in Australia only. If you have a niche market and your market is Australia, that’s not what we’d call a scalable start-up,” he says. “So we’re looking for big ideas.” Stone is quick to point out the program won’t be easy. “Anyone would love somebody to hold their hand. We’ve realised that is probably counterproductive,” he says. “It’s not our job to build these companies. It’s their job to prove they’re entrepreneurs, and we produce a great environment to help them bloom and succeed. “There’ll be fewer sessions in the weeks. [Last year,] we had too many people in and out, talking to our start-ups and distracting them from the game of building their business. “The second thing is, our start-ups started pitching their ideas too early. “This year, we want them to focus on ensuring they have product-market fit by talking to customers and then start pitching to investors.”
Key players in the Australian tech start-up scene have lashed out at Prime Minister Julia Gillard’s suggestion the 457 visa program is being abused by the IT industry.
Pollenizer co-founder Phil Morle has revealed the reasons why iConnect Catering was named the winner of the latest Startup Weekend Perth, highlighting the growth of the Perth start-up scene.
Silicon Valley start-up expert Tyler Crowley has shared his thoughts on how local start-ups can improve their pitches and gain more media attention, as part of a whirlwind Australian visit. Crowley has been helping start-ups improve their pitches since the first TechCrunch40 events and is involved with the LAUNCH Conference, where he works one-on-one with start-ups. He is also a co-host of This Week in Startups where he shares insights on the art of pitching. Crowley is in Australia to host several clinics for up-and-coming Australian start-ups, and work with key players to help them improve Australia’s start-up ecosystem. His visit to Australia is the result of a partnership between Pollenizer, From Little Things, The New Agency, Event Directors and Mi9. In an interview with StartupSmart, Crowley shared his thoughts on the following topics. Improving Australia’s start-up community “There’s a list of ingredients [to create a successful start-up community],” Crowley says. “Some of the key ones that do exist here are lots of small tech meet-ups are already happening. That is always sort of the first phase of the organic process. “Another key ingredient that Sydney has, that other cities would love to have or would kill to have, is an official home for the community… Fishburners is exactly that. “One thing Sydney doesn’t have is an official monthly meet-up of all the smaller meet-ups. “Having a key brand that represents the entire community, such as Silicon Beach, [is important] but there are no rules that go along with it. “If you have an event with 200 people and everyone’s ‘checking in’, that gets out and spreads globally… and gets the attention of other communities of what’s going on here.” Selling yourself “[Pitching] is not an integral skill that most CEOs have. Sometimes they’re too close to their own product and don’t know how to communicate it,” Crowley says. “The first step is to get them to empathise with the audience and see how the audience feels. “We don’t show children PowerPoints – we tell them stories. It’s much easier to retain information when it’s in a story format rather than a PowerPoint format. “The default is to be slightly critical and analytical [in your pitch]… Get the audience in a really emotional state… rather than a critical and analytical state.” “The same strategy [applies when selling to customers]… Try not to be so analytical. Be more emotional and empathise with the person.” Gaining media attention “Media folks, when you email them, are very critical. They’re rather dismissive and looking for a reason to say no,” Crowley says. “One way to get around that is to [keep your email] brief and link to some sort of movie… For whatever reason, journalists tend to be quite visual people and storytelling people. “They will click on the link and watch the movie.” “I think a problem a lot of start-ups have is they communicate with journalists in a totally different language. “When you convert your pitch into a mental movie or story, it shows you’re really doing it yourself and it makes journalists’ job much, much easier.”
It’s fair to say 2012 was a mammoth year, not only for the various incubators and co-working spaces, but for the Australian start-up scene in general.
Despite being just five months old, FlikGift has already secured a strategic partnership with Australian digital media company Mi9, and enjoys the backing of start-up incubator Pollenizer.
Sydney tech start-up incubator Pollenizer has branched out to Singapore, launching a new hub in the city state and launching its first start-up there.
The co-working trend continues to gather pace, with a new space set to launch in Hobart, much to the delight of Tasmanian start-ups, while a Melbourne suburb has been pegged as a potential location for a new collaborative hub.
Sydney-based start-up incubator Pollenizer has forecast an improved success rate with the ventures it partners with after striking a new partnership with digital media company backed by Microsoft and Nine Entertainment.
Australian start-up founders are being asked to participate in a project that aims to determine the “DNA” of Australia’s start-up ecosystem, with local industry experts offering their own insights.
Start-up accelerators will need to specialise and differentiate themselves in order to succeed in the future, an expert says, but local players say some accelerators are already doing this.
This article first appeared May 7th, 2012. Nikki Durkin is a well-known name in the Australian start-up world.
Sensis has launched a series of challenges to inspire developers to create viable apps, offering a $2,500 “bounty” for the concept that best utilises its API content and functionality.
The co-founder of Melbourne-based incubator AngelCube says he makes a conscious effort to recruit female mentors, but believes more can be done to entice women into the industry.
Team members at Sydney-based tech incubator Pollenizer have outlined lessons learnt from start-up guru Eric Ries, who visited Pollenizer earlier this month as part of a trip to Australia.
Start-up incubator Pollenizer has teamed up with Sensis to host a two-day hackathon later this month, inviting entrepreneurs to vie for a share in more than $50,000 worth of prizes and perks.
Australian start-ups suffer from a conservative approach by investors, rather than a lack of funds, industry experts have claimed, as they prepare to speak at the National Angel Conference.