Melbourne-based startup lawyers General Standards is opening New York and London offices to support its Australian startup clients’ international expansions. Since launching in 2013, the company has advised over 200 startups and is helping launch more than 30 new companies every month in Australia. Founded by Australian startup lawyer Kurt Falkenstein, General Standards has built its Australian practice focused exclusively on advising startups, entrepreneurs, angel investors and venture capital funds. In anticipation of the firm’s growth, James McQueen, a former senior associate with Corrs Chambers Westgarth, has joined the company as global CEO. Former Minter Ellison London senior associate Campbell Unsworth has been appointed as global director and UK partner and will launch the UK office later this month. Spencer Wolf, a graduate of Harvard, Columbia and Yale universities commenced as the New York partner in July. “As a startup with a healthy mix of global ambitions and local talents, we recognise that some of the most innovative ideas for our business and clients will come from a more global perspective,” McQueen says. “Leveraging expertise and market experience across Melbourne, New York and London for the benefit of our Australian clients, and vice-versa, is a great way for us to deliver on this. “What we’re doing is certainly disruptive in terms of the legal industry, and at its heart is supporting the growth of startups in Australia.” Falkenstein says in the past it’s been difficult for startups to access legal advice simply because it’s too expensive and law firms find it difficult to justify offering startups discounted advice without doing the same for larger, established companies, loyal to their firms. Because General Standards focuses exclusively on startups and doesn’t have those “legacy clients”, it says it’s able to offer a more transparent service. It uses a technology-driven model which enables it to provide low cost, fixed-fees and allows its lawyers to spend more time helping entrepreneurs. “We want all entrepreneurs to be able to afford top quality advice when it comes to starting a new business,” Falkenstein says. “We wanted to give startups the legal support and structuring advice they needed, at a fixed-price and in a transparent way that makes sense for them.” Follow StartupSmart on Facebook, Twitter, and LinkedIn.
The business world is abuzz this morning with news that China’s biggest e-commerce business Alibaba has filed its initial public offering, which could become the largest IPO in history. Alibaba Group was established by billionaire Jack Ma in 1999. The business has two main shopping websites, Taobao and Taobao Mall (or Tmall), which serve an estimated 79 million customers in more than 240 countries and territories. The group also has investments in a Chinese department store operator, mobile messaging apps maker Tango, and China’s version of Twitter, Weibo. Described as “eccentric”, Ma is known for both his unconventional career trajectory and idiosyncratic business style. Here’s five things you didn’t know about the man nicknamed “Crazy Jack”. 1. Ma started out at as a teacher Alibaba’s chairman studied to become a teacher after twice failing university entrance exams. Ma’s struggle with formal education and finding employment, including being knocked back from Harvard 10 times, is well-documented. He says he was even tuned down from a job as a secretary to a general manager at KFC. 2. He founded China’s first internet company Ma’s first foray into the digital world was with China Yellowpages, believed to be the country’s first internet-based company. According to the Wall Street Journal, it was a trip to Seattle in 1995 that sparked Ma’s interest in the internet, after he discovered during the trip how little information about Chinese companies existed on the web. 3. He enjoys singing pop songs and hit musical tracks Ma also apparently has a soft spot for performing Chinese pop songs and his favourite songs from the Lion King in front of crowds of thousands at his annual company conferences, called “Alifest”. In the past he shared a stage with former US President Bill Clinton, Los Angeles Lakers basketballer Kobe Bryant and Arnold Schwarzenegger. 4. Ma is huge fan of kung fu Ma is such a fan of kung fu novels that Alibaba employees are all required to take nicknames from kung fu novels. According to the Financial Times, which named Ma its Person of the Year in 2013, Ma’s nickname is “Feng Qingyang”, which refers to an “unpredictable and aggressive” swordsman. 5. He admits to knowing very little about technology Despite being the founder of one of the globe’s largest online businesses, Ma admits that he is not an expert when it comes to technology. According to TechCrunch, the entrepreneur says he cannot write code and knows little more than how to send an email.
A eulogy for Twitter. Adrienne LaFrance and Robinson Meyer argue in The Atlantic that the social media platform is dying. Although Twitter added 14 million new users for a total of 255 million, the pair say Twitter’s users are less active than they once were. “Twitter says these changes reflect a more streamlined experience, but we have a different theory: Twitter is entering its twilight.” According to France and Meyer, the question is – did Twitter change or did we? “Twitter used to be a sort of surrogate newsroom/barroom where you could organise around ideas with people whose opinions you wanted to assess. Maybe you wouldn't agree with everybody, but that was part of the fun. But at some point Twitter narratives started to look the same. The crowd became predictable, and not in a good way.” Uber cab confessions. As Uber attempts to upend the Australian taxi market it’s worthwhile taking a look at Mickey Rapkin of GQ’s take on spending a week as an Uber driver. Uber is pricier than your standard taxi. So what's the hook? Instant gratification, a hint of glamour, even some sex appeal. “Uber capitalizes on what economists refer to as ‘slack resources’ or ‘underutilized capacity’,” Rapkin says. “Translation: Why let your car sit idle in the driveway when you can turn it into a cash machine? The future is all about monetising downtime.” Gap alums rule the fashion world. In SFGate, Maghan McDowell writes about the Gap retail program which is known as the Harvard of retailers. "If you're trying to develop a career in retail, you have to do this program," says Stanford graduate Jessica Lee, who chose Gap over Google's Associate Product Manager Program, then under Marissa Mayer, in 2008. "You're not just applying to a job. You're being fostered, and they're basically paying you to learn." But as McDowell discovers, while Gap seems to have no problem attracting and training top talent, holding onto them after they reach middle management seems a more elusive endeavour. “The program remains renowned among retailers, but former Gap trainees have moved on from Gap to lead other companies – or to start their own. Call them the Gap Mafia. They're steadily influencing retail at boundary-pushing brands gaining recognition all over the world.”
The National Commission of Audit report’s contention that government support of startups provides no real benefit to the community is flat-out wrong, according to a number of startup industry figures and two major reports into the industry. Rui Rodrigues, investment manager of Tank Stream Ventures, says the commission’s suggestion is ridiculous. “It’s a very short-sighted view and there isn’t any logic behind it,’’ he says. “They’re essentially saying that the thousands of jobs created through startups and technology have had no impact on the economy.” It’s an opinion echoed by Sydney Angels management committee member Richard Dale. “The verdict’s been in for quite a long time, a startup, as long as it’s a high growth potential venture and not a lifestyle business, is a net creator of jobs,’’ he says. Last month peak not-for-profit StartupAUS released its report Crossroads: An action plan to develop a vibrant tech startup ecosystem in Australia which highlighted that startups play a big role in job creation – three million new jobs are added to the US economy each year by new firms, while existing firms lose a total of a million jobs per year. The Crossroads report noted Harvard professor of economics Ricardo Hausmann’s observation that Australia has “an amazingly primitive export basket”, which he says will lead to Australia becoming one of the worst performers in the region in terms of GDP growth. StartupAUS board member Bill Bartee, who is also a co-founder and managing director of Blackbird Ventures and Southern Cross Venture Partners, believes the commission is taking the wrong position. “Well I don’t know where they’ve been or where they’re getting their data,’’ he says. “It’s pretty clear when you look across the OECD and the US that there’s been lots and lots of job growth from startup and tech companies that build real businesses. “The eBays of the world, all of these very, very large tech companies that drive the US economy in a lot of ways were once very small companies. “It’s not as if the government is assisting a dying industry.” artee says he’s a firm believer in the need to support tech startups by providing capital, both human and financial. Last year, The Startup Economy, a report commissioned by Google and carried out by PricewaterhouseCoopers, found high-growth tech companies have the potential to contribute 4% of the Australia’s GDP by 2033 while adding 540,000 new jobs. Currently, startups contribute just 0.2% to the nation’s GDP. The commission’s recommendation that the government abolish Commercialisation Australia and the Innovation Investment Fund would leave Australian startups in a weaker position, says Dale. “Do they benefit? The answer is yes, these programs are putting experience, talent and money into the startup ecosystem,’’ he says. “Are they perfect? No. Do they help? Yes. Does taking them away have an impact? Yes, absolutely. Are they the best way of reducing barriers startups and early stage ventures face? Probably not. “All programs, all solutions can be improved, but we have programs at the moment that are functioning, providing benefit – so don’t turn off the tap. “The two years it will take to design, approve and implement a new program, that’s two years of lost opportunity.’’ Startup Victoria CEO Lars Lindstrom added to the chorus of startup community voices speaking out against the Commission of Audit’s recommendation. “In our view CA (Commercialisation Australia) has been doing a good job and the IIF(Innovation Investment Fund) structure of government matching investment 1:1 mirrors successful initiatives elsewhere such as in Singapore,’’ he says. “I don’t agree that it’s as simple as saying ‘finance can be acquired from the private sector’, VCs have had poor returns and therefore funding is in short supply.” “It may be short-term cost-saving but in the long run it would be highly damaging to the Australian economy.’’
So many people think that money is what motivates people. Surprisingly, it’s far from the truth. The old thought system to motivation is reward and punish. The stick and the carrot. Alfie Kohn writing in the Harvard Business Review points out that offering rewards to change set behaviours like eating less or quitting smoking does not work. Numerous psychological studies back up his thesis. Dan Pink in his outstanding book Drive showed that the carrot and stick works for short-term motivation but not for long-term engagement or long-term results. “Incentives ... do not alter the attitudes that underlie our behaviours,” Kohn says. “They do not create an enduring commitment to any value or action. Rather, incentives merely – and temporarily – change what we do.” “It is plausible to assume that if someone’s take-home pay was cut in half, his or her morale would suffer enough to undermine performance … but it doesn’t necessarily follow that doubling that person’s pay would result in better work,” Kohn postulates. Simon Sinek in his book Start with Why shows that the reason behind what we do really motivates us to put in more effort long term. If someone identifies with the company value of what you are doing and the why behind it, they are more likely to adhere long term to fulfilling the role with passion and enthusiasm. As Harvard Business School professor Teresa Amabile has found, a sense of progress is crucial to actually staying engaged. In an experiment detailed in her book The Progress Principle she asked 238 employees across seven companies to keep daily diaries of their workdays. She found a pattern. A close analysis of nearly 12,000 diary entries, together with the writers’ daily ratings of their motivation and emotions, shows that making progress in one’s work – even incremental progress – is more frequently associated with positive emotions and high motivation than any other workday event. During Pink’s TED talk in 2009, he says there is a mismatch between what science knows and what business does. Rewards, he says, make us single-focused, which leads to incorrect solutions. The solution is autonomy rather than top down, which he says is great for automated mechanical processes but not for the more creative processes required in this century. Tony Hsieh, the chief executive Zappos, in his seminal book Delivering Happiness is clear that creating the why and a culture that backs it up, is the only way to get long-term motivation. Given he built the company from a revenue of $1.8m in 2001 to $1 billion in 2009, maybe we should be heeding the message. Brett Jones is CEO of The Entrepreneur Tribe by Cre8 and frequent author on entrepreneurial matters. @cre8australia
The 11 rules of highly profitable companies From the man who brought us the four-hour work week, self-described human guinea pig Tim Ferriss, is this pretty insightful list on what drives profitability. “How do you generate the most profit with the least effort? How do you maximise margins without sacrificing quality?” Ferris asks. There’s some strong advice here, that’s probably worth listening to: “Many companies will sell direct-to-consumer by necessity in early stages, often through a simple website. Only later do they realise that their margins can’t accommodate resellers and distributors when they come knocking. This is true whether your ‘distributor’ is iTunes, a worldwide widget distributor, or Orbitz.” The five competitive forces that shape strategy In a follow up to his 1979 essay How Competitive Forces Shape Strategy, economist and associate professor, Michael E. Porter discusses the forces that shape strategy in a video interview for the Harvard Business Review. He addresses common misunderstandings, provides practical guidance for users of the framework, and offers a deeper view of its implications for strategy today. “The strongest competitive force or forces determine the profitability of an industry and become the most important to strategy formulation. The most salient force, however, is not always obvious.” Why the Trix rabbit looks down on you: FiveThirtyEight, the new data blog by Nate Silver, looks at how marketing works. “…[you] might not have thought much about the eye contact of cereal-box cartoon characters. Don’t fret: a new study investigated precisely that.” Indeed, the study found comic characters depicted on the boxes of children’s breakfast cereals are almost always looking downwards. That’s because in supermarkets the boxes are typically displayed on shelves above a child’s eye-level; the characters, by looking downwards, appear to be looking at the children – in effect, making eye-contact, as a device for gaining attention and increasing trust. How Gmail happened: The inside story of its launch 10 years ago Gmail is 10 years old, and Time takes a look back at how it all happened. When Google launched Gmail on April 1, 2004, the offer of 1GB free storage per user – 500 times what Microsoft’s Hotmail offered – seemed so implausible that some mistook it for a prank. And so begun a revolution of sorts. “If you wanted to pick a single date to mark the beginning of the modern era of the web, you could do a lot worse than choosing Thursday, April 1, 2004, the day Gmail launched.”
Lessons from the catwalk: Models in skyscraper heels on New York Fashion Week runways may seem a far cry from running a boots-on-the-ground business in Australia, but there is a big lesson to learn from how the world’s best style-setters use social media. Writing for inc.com, Stephanie Meyers unearths six of the best tricks they use to keep their fans, far and wide, captivated on their every move. Embrace rejection and five other business lessons: Columnist and New York Times bestselling author A.J. Jacobs writes on LinkedIn that some of the best things we can learn and do for our businesses can be inspired from the most unlikely places and figures from history. Soap in a pump, who thought of that? The man’s name was Robert R. Taylor, and his simple idea revolutionised people’s behaviour across the world. He was also behind Calvin Klein’s famous fragrance, Obsession, and the ground-breaking advertising style that promoted it. The New York Times reports that he died this week aged 77, but his entrepreneurial spirit has certainly left a mark. Forget the four-hour work week, 72 is the new norm: Most people respect and admire Tim Ferriss, author of The 4-hour work week for encouraging businesspeople to work smarter, not harder. But Jennifer J. Deal writes for Harvard Business Review Blog Network that, in the US, some professionals are connected to work 72 hours a week. Demands by the boss to have meetings at 9pm on Friday night or be responsive to communication on weekends are key to this. As a business owner, where do you draw the line?
Family lives of entrepreneurs: In her last column for the print version of Inc., Meg Cadoux Hirshberg reflects on her time charting the ways entrepreneurship impacts upon families. She writes that because entrepreneurs owe the best of themselves to their businesses and families, work-life balance is impossible – but that doesn’t mean they shouldn’t try. How snacking became respectable: It may be hard to believe, given the much publicised problem with obesity in the US, but snack foods were once looked upon with suspicion and even scorn. But this essay in The Wall Street Journal describes how commercialisation altered the image of snack foods to become respectable. Richard Branson on taking an inspiration vacation: How does one of the world’s most recognised entrepreneurs nurture inspiration? He makes sure he disconnects from the office and carries a notepad and pen for whenever an inspiring thought comes to him. In this article for Entrepreneur, Richard Branson also suggests asking whether staff return from their own holidays inspired and recommends group holidays. Six skills for triple-strength leadership: The Harvard Business Review has identified an emerging, but rare, brand of leader – one with three distinct sets of strengths. This leader is seen as someone who can engage across the private, public and social sectors. The magazine sets out the six skills that set these leaders apart, including balancing competing motives, acquiring transferable skills, and building networks.
With the constant demands business owners face each day, it’s hard to harness new opportunities in the market, and find the best way to put innovations in place. Are tight deadlines, big teams and micro-management the key to launching new ideas and measuring results quickly? Apparently not, according to writer Scott Antony. For the Harvard Business Review Blog Network, he explores five ways to do things better, and they may not be quite what you expect. Most people spend a lot of time weighing up options, but in business, deliberation is impractical. For the Farnamstreet blog, writer Shane Parrish draws on the world of elite baseball to consider how we can use our “strikezone” to make the best choices. He also tells us how to know when we’re not fit to call shots. The world of high finance, computers and crime always allures, particularly the case of the Goldman Sachs programmer accused by the company of lifting proprietary computer code. The case, which saw the man jailed for eight years, has raised questions over exactly what he did wrong. Michael Lewis delves into it for Vanity Fair. With their red-striped poles and no frills interiors, barber shops verge on ‘historical relic’ when it comes to the hairdressing industry. But a mysterious attraction keeps them alive. To a female, they feel like a no-go-zone – a secret place for men to groom and chat with the barber they become friends with over the years. For The Spectator, Henry Jeffreys gives his view on why barber shops are booming, and why he keeps going back. This story first appeared on SmartCompany.
The US-founded Startup Grind event series continues to grow in Australia, with the Sydney and Melbourne chapters set to host the founders of Atlassian and Zendesk respectively.
Once the brainchild of Harvard classmates, Facebook is now a multi-billion dollar company connecting everyone and everything.
A number of new start-ups have likened themselves to US-based company Airbnb, the leader in travel rentals, which has booked more than 10 million nights of accommodation worldwide.
Yes, I promised that this week, I'd share tips on raising capital in Silicon Valley. But I've postponed that post.
Facebook founder Mark Zuckerberg has imparted some new words of wisdom to start-ups, insisting the desire to solve a problem must always be greater than the desire to start a company.
The business world is littered with inspiring tales of entrepreneurs who, through their innovation and hard work, overcame humble beginnings to strike it rich.
Australia’s innovation performance is “appalling” compared to other countries in the Organisation for Economic Cooperation and Development, according to a former chief scientist.
I’m thinking about applying for a start-up accelerator program, but it seems like a lot of equity for not much funding. How can I be sure that the program will be worth it?
Iconoclast, by Gregory Berns (Harvard Business Press, 2010, 250pp, RRP$29.99) According to author Gregory Berns, an iconoclast is a person who does something that others say can’t be done.
We all know that in order to establish a successful business you need to focus on delivering a solution to your target market.
Start-up incubator Y Combinator has held its 14th demo day for 65 start-ups, with many start-ups fielding investment offers following their presentations.