Starfish Ventures pours $500k into tech start-up BugHerd
Australian tech start-up BugHerd has secured a $500,000 investment from local venture capital firm Starfish Ventures, which will be used to bolster the BugHerd team and scale its product.
Founded by Alan Downie and Matt Milosavljevic, BugHerd came about after the pair were unable to find a bug-tracking solution suitable for logging and managing visual website issues.
After honing their idea, Downie and Milosavljevic pitched to Australian incubator Startmate and were selected to participate in their start-up class of 2011.
BugHerd has since attracted investment from US incubator 500 Startups, becoming the first Australian company to participate in the 500 Startups program.
It also won an award at technology innovation event Tech23, held in Sydney.
BugHerd co-founder Alan Downie says because the company received a lot of exposure in such a short timeframe, it could afford to be more discerning when choosing an investment partner.
“From very early on, we were keen to work with Starfish Ventures,” Downie says.
“Not just because they’ve recently backed some pretty high profile tech companies like DesignCrowd and iSelect, but because it enables us to stay here in Australia.”
“A lot of start-ups are in a rush to get over to the US these days, but we’re keen to show that with the right support, you can do it all from here without compromising the business.”
“And with Starfish, we still have the option of moving to the States if we ever choose.”
As part of the deal, Starfish Ventures investment director Tony Glenning will join the BugHerd team as a director, with Downie describe Glenning’s involvement as “instrumental”.
“Matt and I are great product guys but we know we have a long way to go before we’re great business guys, and I think that’s the sort of support you get from an investor like Starfish,” he says.
“There’s also the obvious benefit of increasing your network, and getting exposure to people and companies that otherwise might not hear about you.”
According to Glenning, Starfish Ventures is acutely aware of BugHerd’s potential, hence the decision to invest in the company.
“We could see how the products available on the market really weren’t usable by non-technical users, leaving a huge gap in the market for a solution like BugHerd,” he said in a statement.
“The guys have really identified a strong customer pain-point and developed a remarkable product to meet it.”
Downie says the funding will be used to hire “great talent” and scale the product.
“We have a really good product at the moment that is squarely focused on small agencies, so we’re looking to expand that vision,” he says.
“We’re also bringing on support in marketing – James MacGregor, ex-Pollenizer marketing director, joined us last week – and looking for a few talented frontend developers.”
Downie says while many Australian start-ups feel compelled to travel to the US to secure funding, they shouldn’t underestimate the level of activity among local investors.
“There is a growing buzz around start-ups in Australia – angel investors and incubators are popping up everywhere,” he says.
“There are so many opportunities to get your product in front of people who are eager to help support and grow your business. It’s a great time to be starting a business.”
“If I have one piece of advice, it’s ‘explore every avenue’. You won’t get anywhere waiting and hoping.”