Mike Cannon-Brookes


Labor announces $500 million Smart Investment Fund policy, startups welcome move to ease funding crunch

5:22AM | Friday, 15 May

The startup community has welcomed Labor’s intention to increase the amount of capital available to startups, but some have questioned whether a proposed $500 million startup investment fund is the right mechanism to achieve that goal.   Opposition leader Bill Shorten outlined plans to create a $500 million startup investment fund, in partnership with venture capital firms, in his budget reply speech on Thursday night.   “I believe Australia can be the science, start-up and technology capital of our region: attracting the best minds, supporting great institutions and encouraging home our great expats,” Shorten said in the speech.   “Labor will create a new, $500 million, Smart Investment Fund, to back-in great Australian ideas like this.   “Our Smart Investment Fund, will partner with venture capitalists and fund managers to invest in early-stage and high-potential companies.”   Aus has a great pedigree in startups that have bootstrapped: Atlassian, 99Designs, Envato, etc. - but, today, most need VC $ to grow fast — Adrian Stone (@SmallTimeVC) May 15, 2015   Alongside the Smart Investment Fund, Shorten proposes to create another new body called StartUp Finance.   “Labor will work with the banks and finance industry to establish a partial guarantee scheme, StartUp Finance, to help more Australians convert their great ideas into good businesses,” he says.   “We will enable entrepreneurs to access the capital they need to start and grow their enterprises.”   AVCAL chief executive Yasser El-Ansary told StartupSmart the secret to success for a program such as the Smart Investment Fund is a bipartisan commitment and certainty.   “The big handbrake on Australian innovation has been that policies have chopped and changed every three years or so. Venture investment is about backing a company for five to 10 years, and changing policies every three years means hitting the reset button. You go back to square one and have to consider a new set of policies and rules,” El-Ansary says.   “Innovation policy should be one area everyone agrees on. Everyone agrees we want new jobs, the best employees in Australia and new industries. What’s missing is a bipartisan commitment.   “So the opposition leader’s comments are very positive. The next logical step is for the government and opposition to work together, and to work with industry, on a common set of policies and principles. That way, it doesn’t matter if we have a Coalition government or an ALP government, Australia’s innovation policy moves in one direction.”   @jrmck @apglo true - & unlikely as "funded" - but hell, it's a bold statement that tech skills investment is needed or Aus is fucked. — Mike Cannon-Brookes (@mcannonbrookes) May 14, 2015   El-Ansary says the Smart Investment Fund appears to be similar to the Innovation Investment Fund, which was introduced early in the term of the Howard government, and scrapped in the 2014 budget by the current government, following the Commission of Audit. He also cites similar program in the US, which have been in place for over 50 years.   “The concept is very similar, and there are runs on the board. For example, Seek was created with funding through the IIF. We know programs like that can deliver, but they need to be in place for the long term,” he says.   “Behind the recommendation from the Commission of Audit was momentum away from industry handouts, driven by the car industry. In deciding not to support the automotive sector, all industry programs were seen as being the same of working the same way. But that’s incorrect. [The IIF] was more akin to investing in a business than to handing out a blank cheque.”   Startup Victoria interim chief executive Scott Handsaker told StartupSmart there are potentially other, better policy options for promoting startup investment.   “While I am usually in favour of anything that helps more investment funds get into the hands of early-stage companies, I really think there are better levers for the federal government to pull if they really want to drive economic outcomes and job growth,” Handsaker says.   “To fund match up to $500 million into Venture Capital companies will increase the amount of capital available, but in and of itself it’s not a game changer. We would prefer Labor look at instead replicating the tax incentives available to early stage investors in the UK, which have been extremely successful in getting high net worth individuals to put their money into startups.   “So encourage more money into companies, but do it at seed stage and do it through encouraging individuals to invest, rather than large VC’s. In my opinion, you will get a far better outcome for Australia.”   Looks like the ALP is trying to establish a new base of supporters in the Australian startup ecosystem. A small number but loud voices. — Alfred Lo (@apglo) May 14, 2015   It’s a position echoed by AirTree Ventures partner Craig Blair.   “VC fund matching may not be the panacea everyone is expecting,” he says.   “Past schemes such as IIF have largely failed to develop a sustainable VC ecosystem and there are encouraging signs that the recent crop of VC funds will get the right support from the private sector for the right reaons i.e delivery a healthy return to investors.”   ilab director Bernie Woodcroft says he’s reserving judgement until more details emerge, but says he believes Australia’s startup ecosystem does need policies that make it easier to access investment.   “What I would like to see is a differentiation between startup opportunities, and disruptive knowledge opportunities, from small business opportunities, and creating a clear distinction between those. Because that is something that isn’t clear in a lot of the political debate at the moment,” Woodcroft says.   “For example, strong investment into new businesses that seek to be disruptive is rarely profitable early on, and so things like tax deductions or write-offs are not really relevant. So what we need to see is things around easier access to investment, as well as investments into an education system that supports STEM jobs.”   Do you know more on this story or have a tip of your own? Raising capital or launching a startup? Let us know. Follow StartupSmart on Facebook, Twitter, and LinkedIn.

Bill Shorten’s STEM policy wins startup support: “The best thing we’ve heard from either party in 20 years”

5:20AM | Friday, 15 May

Labor leader Bill Shorten has unveiled his party’s STEM (science, technology, education and maths) education policy as a key focus of his budget reply speech, with one leading startup investor calling the policy “the best thing we’ve heard from either party in 20 years”.   Labor’s Futuresmart policy aims to have coding taught in every Australian every primary and secondary school by 2020. In order to accomplish this, Labor will provide additional training in STEM disciplines to 25,000 existing teachers at a rate of 5000 per year.   It will also encourage an additional 25,000 STEM students to become teachers by paying them $5000 to take up a teaching degree, and a further $10,000 after their first year in the classroom.   The policy will also write off the HECS debt of 100,000 STEM students, and encourage more women and minorities to study, teach and work in tech-related fields.   Other parts of the proposal include investing $9 million in creating a National Coding in Schools centre (NCIS) to support the teaching of coding in schools, and boosting R&D spending to 3% of GDP.   Wow. Labour budget reply is amazingly smart. 100k IT scholarships, CS in schools, VC fund matching & 3% of GDP in R&D by 2020?! Incredible. — Mike Cannon-Brookes (@mcannonbrookes) May 14, 2015   “Nothing matters more to Labor than securing the jobs of the future… And the new jobs of the future require new skills. Designing skills, coding skills – building, refining, adapting and servicing the machines and supply chains of a new age,” Shorten said.   “Yet today, two out of every five science and maths teachers for years 7 to 10, don’t have a degree in these subjects.   “Digital technologies, computer science and coding – the language of computers and technology - should be taught in every primary and ever secondary school in Australia. And a Shorten Labor Government will make this a national priority.   “We should aspire, together: universities, industry, the people and the Parliament to devote 3% of our GDP to research and development by the end of the next decade.”   99designs founding investor Leni Mayo says while there’s not enough detail to discuss the specifics of how the plan will be implemented, the policy is “well thought out” overall.   “This is the best thing we’ve heard from either party in 20 years. This is a root-and-branch attempt to address the issues inhibiting Australia from tackling the best the world has to offer in terms of technology and innovation,” Mayo says.   “At a high level the policy is coherent. More focus on STEM subjects in university and HECS relief are credible mechanisms for getting more trained STEM teachers into our schools,” he says.   And I say - hallelujah! https://t.co/UubnOJCO1d — Annie Parker (@annie_parker) May 15, 2015   Startup Victoria interim chief executive and Attendly co-founder Scott Handsaker also backs the STEM proposal.   “So many people have been calling for computer coding to be added to the national curriculum over the years that it is amazing to finally hear a politician call for it to be rolled out. The future workplace is going to be so different to what we are used to that it is critical we start preparing our kids for an era powered by technology,” Handsaker says.   “The policy of writing off the HECS debts for 100,000 students who complete a degree in a STEM based University course is a fantastic initiative. STEM skills are required for the jobs of the future and we are not producing anywhere near enough qualified students to meet ongoing demand.  To then encourage a portion of those graduates to go on and complete a teaching degree is cleverly structured and a super policy.   “Big thumbs up from Startup Victoria.”   A spokesperson for the Australian Computer Society told StartupSmart coding and computational thinking “are an absolute necessity if we are to give our children the best possible chance to become the leaders of the workforce of the future”.   “ACS has long called for mandated teaching of coding and computational thinking,” the spokesperson says.   “It is no secret that Australia’s economic future is in the knowledge and service space, so seeing these initiatives brought to the fore is something we strongly support. Schools in the UK are already teaching coding from the age of five, and if Australia does not get on board we will be left behind.   “Looking at the UK implementation, the UK Government engaged the British Computer Society and others in the ICT industry to assist in teacher training. We – and the industry more widely – stand ready to assist the Government in the training of teachers and believe that, while this is certainly an ambitious goal, it is an achievable one with the right funding and policy framework and importantly commitment in place. It should be clear though that the training needs to be of a high standard, and cannot simply be seen as a crash course in technology. We need to produce teachers who can be genuinely passionate about technology education, and pass that on to their students.   “We believe that the time for talking is past. If we are to give our students the very best shot at being the digital leaders of the future, we need to start a program of coding and computational thinking now. It simply cannot wait until 2017. This represents a great chance for the Government, business and community to come together and build the digital workforce of the future.”   Do you know more on this story or have a tip of your own? Raising capital or launching a startup? Let us know. Follow StartupSmart on Facebook, Twitter, and LinkedIn.

High-profile startup Ninja Blocks pulls the plug as money dries up

5:03AM | Monday, 11 May

Internet of things startup Ninja Blocks has shut down after running out of money.   The startup was founded in 2012 and is a graduate of the Startmate accelerator program. Late last year it raised $700,000 from SingTel Innov8, Blackbird Ventures and 500 Startups, to launch its latest product the Ninja Sphere. It has also received investment from Atlassian founders Mike Cannon-Brookes and Scott Farquhar.   Its home automation product Ninja Sphere smashed its Kickstarter goal of $155,000, raising $703,000. In a blog post announcing the decision to close, Ninja Blocks’ Elliot Shepherd says all but 300 of the Spheres are built and ready to ship. The plan is to try and get at least one Sphere to every Kickstarter backer. Those that ordered more than one Sphere might not get their whole reward.   “This feels wrong, like we’ll be annoying the people who were our strongest supporters, but we don’t have a better option,” Shepherd says.   “If and when we could get Ninja back up and running, building and shipping those 300 Spheres would be our first job and highest priority.”   Shepherd says development of Sphere ran overtime and as a consequence over budget. When the possibility of further investment fell through, the startup decided to shutdown in order to pay creditors and ship “almost all” the Spheres that were promised.   “Even with all the ninjas earning far below what they would expect to get somewhere else, our burn rate couldn’t be sustained forever,” Shepherd says.   “Ninja Blocks has always run lean, and when the next round of investment fell through we didn’t have much runway left to adjust course.   “With no credible source of funding on the horizon, and hardware still undelivered to Kickstarter backers we made the difficult decision to down-tools.”   Shepherd says the Ninja Blocks team would love to find a way to stay together and keep working on Sphere, but “Ninja Blocks, the company, will almost surely be dead”.   “…we’re all reeling here from a big few years and a very difficult few months… but we are all proud of what we’ve been able to accomplish, feel privileged to have worked on such an ambitious project, and most of all feel humbled by the community that built up around our small team,” he says.   “You’ve all been more excited, more interested, and more understanding than we could have hoped or expected or deserved. Thank you.”   StartupSmart reached out to Ninja Blocks president and chief executive officer Daniel Friedman for comment, but did not receive a response prior to publication.   Do you know more on this story or have a tip of your own? Raising capital or launching a startup? Let us know. Follow StartupSmart on Facebook, Twitter, and LinkedIn.

What we learnt from Startmate and our Shark Tank experience

4:52AM | Monday, 13 April

Like all co-founders, Richard Hordern-Gibbings and I are working hard to make our startup Nexus Notes a success. Late last year we did two things to help us on our way: we pitched to be a part of the tech accelerator, Startmate, and the television series, Shark Tank.   We were fortunate to be selected for both. This post explains a bit about both experiences. Startmate Sydney-based Startmate is a network of founders offering mentorship and seed financing to technical teams creating global internet startups from Australia. They invest $50,000 in seed capital for 7.5% of company equity.   Some of the mentors include co-founders of tech giants like Atlassian’s Mike Cannon-Brookes and Scott Farquhar and SEEK’s Paul Bassat. In addition to the capital and mentorship, they also provide office space in an incubator for three months, access to key partners like Amazon and PayPal and introductions to US investors in Silicon Valley over a two-month period.   The Startmate selection process is competitive. For the 2015 intake, over 200 startups applied, 25 teams were shortlisted for interviews and eight made it through. We were excited to be one of the eight companies chosen. We found this out in the middle of October last year and began to make plans to begin work in the program from January 5 this year.   It’s worth mentioning that the Economist listed Startmate as one of the top accelerators in the world based on follow-on funding for alumni. Now in its fifth intake, half of the 29 companies who have gone through the program have raised seed capital. The average deal has been a $US1 million raise at a $US4 million valuation from a combination of Australian and American investors within six months of participating. Shark Tank  Soon after being accepted into Startmate, we heard that Shark Tank were keen for us to pitch on their show. We hadn’t begun the Startmate program yet, so Richard and I sensed that the timing might not be ideal for the Sharks. After consulting our new mentors, the consensus was that we had nothing to lose in making the ask and so in December we did.   The pitch to the Sharks was simple, “Nexus Notes has huge potential, invest now and pour fuel on the fire.” We asked for $300,000 for 7.5% of the company.   One of the five Sharks, Steve Baxter, made an offer which we declined and the other four chose not to invest. Their view was that while they could see the potential in the business, our valuation was too high. Combine this with the fact that Startmate had already come on board and it was ‘no deal’.   Richard and I want to grow a sustainable, global tech business that realises our vision of giving the best students the tools to teach. Our first product allows high-achieving students to publish their notes and we’re looking forward to launching our next products. We’re super excited to be a part of Startmate and have some fantastic mentors on-side.   We were really proud to announce our advisory board last month with some tech all-stars behind us and it was awesome to pitch at the demo day in Sydney last week.     If you’d like to be a part of our story as a user, then start by contributing or purchasing your first set of notes – we’d be pumped to have you a part of our community. If you’d like to invest, then email me athugh@nexusnotes.com and I can talk to you about our current seed round.   Hugh Minson is the co-founder and CEO of Nexus Notes.   Follow StartupSmart on Facebook, Twitter, and LinkedIn.

Atlassian calls out “shady” backdoor listing as increasing numbers of businesses take the shortcut to the ASX

4:19AM | Thursday, 9 April

A growing number of businesses are opting to list on the Australian Securities Exchange through the “backdoor” in a trend Atlassian co-founder Mike Cannon-Brookes describes as “shady”. Backdoor listing explained A backdoor listing involves the acquisition of a private company by a defunct listed shell company in exchange for shares in that company.   The private company then becomes the new owner of the shell company, which it uses to list their business.   The use of backdoor listings by Australian businesses seeking to float quickly is growing, according to figures obtained from the ASX by SmartCompany. In 2014 there were 30 backdoor listings and 109 standard listings on the ASX for the year.   2015 is on track to surpass these figures with nine backdoor listings already in the first three months of the year. Growing numbers of backdoor listings Year ASX listings Backdoor ASX listings 1 Jan 2015 -31 Mar 2015 18 9 2014 109 30 2013 83 19 2012 83 22 2011 133 27 Concerns about backdoor listings It’s a growing trend that Cannon-Brookes says is of concern as he works towards Atlassian’s listing in the United States.   “I worry about the number of backdoor listings going on and it seems like a shady way to get to the market,” he says.   “The quality of the market seems suspect.”   Cannon-Brookes’ comments follow a warning from the Australian Securities and Investment Commission last year over the growing number of backdoor listings.   ASIC Commissioner John Price said the trend highlighted a number of regulatory issues, including some companies not fulfilling their legal obligations to provide audited financial reports.   ASIC also expressed concerns about the failure of some companies to adequately disclose their business models or business plans, especially when it comes to whether or not the business will need to raise additional capital and how this might affect shareholders.   Mike Boon Plener, founder of Funding Connector, told SmartCompany backdoor listings are “a very, very dangerous road”.   “The problem with backdoor listings is that unless you have the revenue that warrants that kind of exposure and presence then it may not be in your best interests as a company,” he says.   “Backdoor listings are neither good nor bad, it is just a vehicle, but there are a number of dangers associated with it which people are ignoring in the excitement of getting on the stock exchange.”   Boon Plener warns listed companies have very different levels of governance and exposure.   “You sneeze and you have to report it,” he says.   “When you run a private company you can sneeze all you want and nobody knows. It’s a different level again.” In defence of backdoor listing Boon Plener concedes there are advantages to backdoor listings for businesses.   “If you are ready for it, you have the revenue to support it, it’s certainly cheaper than a full-scale listing,” he says.   Matthew Gibbs, spokesperson for the ASX, told SmartCompany choosing a backdoor route is a commercial decision based on the circumstances of each business.   “Importantly, backdoor listings must satisfy the same admission requirements as frontdoor listings,” he says.   Last year, data security company Covata raised $15 million through the biggest ever backdoor listing on the ASX.   Covata completed a reverse takeover of failed uranium explorer Prime Mineral in order to list.   At the time, Trent Telford, Covata’s founder and chief executive, said doing a backdoor listing provided certainty.   “We looked at front door versus backdoor but it gave us some assurance the transaction would complete,” Telford said.   “Sometimes people say ‘Will this or won’t this happen’.” Backdoor listings in 2015 2/01/2015 Dubber Corporation Limited   Perth 19/01/2015 Crowd Mobile Limited   Perth 22/01/2015 Aminoca Brands Corporation Limited   Perth 6/02/2015 Spookfish Limited   Perth 17/02/2015 3D Medical Limited Perth   18/02/2015 NewZulu Limited   Perth 24/02/2015 Quintessential Resources Limited Perth   24/03/2015 Manalto Limited Melbourne   31/03/2015 Blackrock Resources Limited Perth   This post was originally published at SmartCompany.

Employee share scheme changes “unashamedly” aimed at early stage startups

3:43PM | Wednesday, 25 March

Early stage tech startups are the focus of changes to the employee share scheme legislation introduced into Parliament on Wednesday.   Small Business Minister Bruce Billson tabled the bill on Wednesday morning, saying the reforms will “restore and rebuild” startup incentives, which were taken away by the previous Labor government.   Speaking to StartupSmart after the second reading, Billson said an effective employee share scheme framework is an important ingredient to any healthy economy.   “There has been a consistent and loud chorus calling for change,” he said.   “The incoming government recognised that and we’ve set out not only to correct the harm of those 2009 changes, but stepping forward with new concessions to bolster support and engagement for employee share schemes.”   The changes   Companies and employees who are issued with options will generally be able to defer tax until they exercise the options (convert the options to shares), rather than having to pay tax when those options vest.   Eligible startups will be able to issue options or shares to their employees at a small discount, and have that discount exempt (for shares) or further deferred (for options) from income tax.   The maximum time for tax deferral will be extended from seven to 15 years.   The maximum individual ownership limit for accessing employee share scheme tax concessions will be increased from 5% to 10%.   Eligible startups need to have an annual turnover of less than $50 million.   In the event a startup raises venture capital, that will not affect the eligibility threshold.   If a startup is acquired before it has operated for three years, its original shareholders will still get their 15% tax deduction on the sale of the shares.     Billson says the changes are on track to come into effect in the new financial year.   “I’ve had encouraging early responses with opposition members and I’m optimistic that will all be implemented as per a tight and demanding timetable which is exactly what the startup industry were calling for,” he said.   StartupSmart understands there is support from within the Labor party to overhaul the current rules governing employee share schemes.   The legislation tabled in parliament today not only allows employees at eligible startups to receive tax concessions, but also ensures the regulatory burden faced by young tech companies is significantly reduced.   Billson says there will be “good-to-go template tools and documents” from the ATO available to help businesses wanting to set up an employee share scheme.   Reuben Bramanathan, senior lawyer at Adroit Lawyers, told StartupSmart there were some “key issues” with the draft bill that have carried over to its current form.   “If an employee resigns from a company on good terms, and they keep their vested shares, they still have to pay income tax at that time,” he said.   “This taxing point applies even if they are unable to sell the shares at that point, for example, due to lockup restrictions in the shareholders’ agreement.”   Billson says this was identified as an issue during the consultation process.   “This was an issue that came up and we consulted quite widely on that as we knew it was an issue of some interest,” he said.   “We extended the tax refund provision to cover situations where an employee is forced to pay when those options lapse or cancel. That’s what we’ve sought to do to alleviate that concern.”   Another part of the legislation that has been criticised is the exemption for startups turning over more than $50 million, as well as companies listed on the ASX. That means companies like Atlassian and Freelancer will not be able to access the scheme.   However Billson defended this, saying issues around employee share schemes “most visibly” affect smaller players.   “It’s unashamedly focused on startups and smaller enterprises,” he said.   “We’ve got to work within a frugal budget climate, therefore we’ve had to target these measures where they can best make a difference.”   Atlassian co-founder Mike Cannon-Brookes has criticised that position, telling SmartCompany last month it’s a bit like saying Facebook and Google don’t need to give employee share options “which I think they would disagree with”.   The new employee share scheme rules are due to come into effect on July 1 should they pass both houses of parliament.   Follow StartupSmart on Facebook, Twitter, and LinkedIn. Buy tickets to the 2015 StartupSmart Awards.

Employee share option scheme reform key to luring Aussies back home

2:24AM | Wednesday, 18 February

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.

Online retailer Shoes of Prey turns to bricks and mortar after scoring $6.5 million in funding

12:30AM | Wednesday, 3 December

Online retailer Shoes of Prey secured $US5.5 million ($6.5 million) in venture capital this morning to fund its bricks-and-mortar expansion.   The retailer, which enables customers to design their own shoes, started off as a pure play online offering.   But Shoes of Prey’s founders, Jodie Fox, Michael Fox and Mike Knapp, have realised the value of having a physical store presence after the success of Shoes of Prey’s David Jones concession stores.   The funding round was led by US-based Khosla Ventures after the Shoes of Prey team got in touch with Ben Ling, the investment partner at Khosla, through a former Google colleague.   Michael Fox told SmartCompany the deal came together fairly quickly after first reaching out to Ling in July this year.   “That seems to be how venture capital in the US works, warm introductions always seem to help,” Fox says.   New investors alongside Khosla Ventures include Bonobos co-founder Andy Dunn, and ThirdLove co-founders David Spector and Heidi Zak.   Existing investors also took part, including Blackbird Ventures, Atlassian co-founder Mike Cannon-Brookes and Bill Tai from Southern Cross Ventures Partners.   The deal leaves the co-founders with “just under” 50% in equity while Shoes Of Prey’s employees retain 15% equity in total.   In order to “get the deal done” Shoes of Prey’s co-founders had to agree for one founder, at this stage Jodie Fox, to step down from the board.   “US venture firms generally have much smaller boards so we reduced the board to three, so only two of Mike, Jodie and me could be on the board,” Fox says.   “We might set up a rotating structure”.   Fox says “it’s not ideal” but the business should be able to work around the limitation.   Shoes of Prey will use the funding to open more bricks and mortar stores, including in the United States, hire some more key staff and increase its manufacturing facilities.   “We have signed a deal with Nordstrom to open six stores in the US. The first one opened two weeks ago in Seattle and we are opening a store in Westfield Bondi Junction and funding will help with all those stores rolling out,” he says.   Shoes of Prey will roll out another seven stores over the next few months.   “We still sell most of our shoes online but we have realised that there is life left in physical retail,” Fox says.   “It offers a great opportunity for customers to come in and interact with the brand.”   Expanding Shoes of Prey’s manufacturing in China will also reap rewards for the business.   “We have maxed out the size of the space of our factory in China, so we have leased a new three storey 4000 square metre factory and that will give us a lot of room to expand,” Fox says.   “The key thing is that it will bring our delivery time down to deliver shoes within two weeks of the consumer ordering”.   Shoes of Prey previously raised $3 million in Australia in 2012 with further fundraising in 2013.   This article originally appeared on SmartCompany.

Sydney, Australia’s startup capital? Melbourne responds

9:01AM | Thursday, 4 September

Australia doesn't need a startup capital, and certainly not one that operates at the expense of other communities that are popping up around the nation.   Even if we did, there is no evidence Sydney would be the best place for it.   When Mike Cannon-Brookes opined at Sydstart this week that “Australia needs a single city where all its tech startups are concentrated, and that city should be Sydney”, he was essentially suggesting two things:   1. That a single city needs to be the dominant player in Australia in order for our startup industry to be successful.   2. That Sydney has already won the race to be crowned the startup capital of Australia, and that all future community building and government support should be focused on Sydney.   Let’s look at whether these arguments stack up.   Do we need a single city to be successful?   The idea that Australia needs one city to dominate the scene in order to be successful is unlikely to be true. The creation of startup communities is a hard thing to get right, and success does not always go to the biggest and the loudest.   Take Boulder, Colorado as an example. Boulder is a better place to do a startup than Sydney by almost any measure you can conceive of, and yet it has a population of just over 100,000 people.   Clearly size is not nearly as important as quality. You can get great, stand-alone communities operating in various locales quite successfully without worrying about fragmentation of effort.   What about Israel? Tel Aviv is ranked as the second best startup ecosystem in the world by the Startup Genome Project, with more startups per capita than anywhere else and 61 companies on the NASDAQ.   And yet there are other startup communities in Israel that have popped up and been incredibly successful, including Haifa and Jerusalem.   Israel is now widely seen as a “startup nation”, rather than focusing solely on Tel Aviv. With a population of just over 8 million, not even Israel has adopted the centrally planned startup model advocated by Cannon-Brookes.   Cannon-Brookes asks us to adopt the Texas model, arguing that Austin is the leading startup city in Texas.   While that is true, it is hardly an argument for focusing an entire country’s efforts on one city. It's not even an argument that the people of NSW should focus all their energies into the Sydney scene, given that there are still other places in Texas with supportive and successful startup ecosystems.   Perhaps then, that is not how successful communities get built?   If we were going to pick one city, would we pick Sydney?   Even if it were true that one city is eventually going to be the best place to do a startup in Australia, it doesn't necessarily follow that we know who that is going to be.   I cannot think of a single global example where a community has picked an ecosystem winner in advance and set about focusing all their energies in that direction. It’s the equivalent of trying to “pick a winner” before the race has even been run.   Think back to our example of Boulder. Go back 25 years and ask whether the inhabitants of Colorado would have picked Denver (pop. 634,000) to be their startup capital over Boulder (pop. 100,000)?   They would have been wrong, because no one can predict where and how a startup community will emerge. It's harder than that.   That is where we are in Australia. We are Colorado 25 years ago, with all our startup communities in their very early stages of growth.   Strong startup ecosystems are built by founders over very long periods of time. Over the next 25 years, amazing communities will be built in Perth, Adelaide, Hobart, Melbourne, Brisbane, Sydney and others. Some will become bigger and more successful than others, but it will come about through natural, healthy competition.   In 25 years, Sydney may indeed be the best place in Australia to do a startup. Then again, maybe it will be Hobart, Melbourne, Geelong or Newcastle. It really doesn't matter, and we will be far better off as a nation if we encourage all founders to be successful no matter where they live.   Scott Handsaker is the cofounder of Startup Victoria.

We’re all just making it up as we go along, and other startup lessons from Sydstart

9:06AM | Wednesday, 3 September

If the Australian startup ecosystem was to have a family reunion, SydStart might be it.   Over 1000 startup founders, budding entrepreneurs and investors gathered at the Hilton in Sydney yesterday for SydStart 2014.   Among them were Australia’s best and brightest entrepreneurs, Atlassian co-founder Mike Cannon-Brookes, Freelancer chief executive officer and chairman Matt Barrie, Startmate founder and investor Niki Scevak, Canva co-founder Melanie Perkins and many more.   It was Mike Cannon-Brookes, perhaps the most uncomfortable with his position as one of the key figures the Australian industry looks to for advice and guidance, who drew the most interest.   He spoke of feeling like a fraud when meeting other prominent startup founders from around the world and being pleasantly surprised by the fact that they felt the same way. And he had a lesson for founders: entrepreneurs are all the same.   “You move up this weird totem pole of entrepreneurs, where you get to meet more and more interesting people and you to these weird points where you’re so excited to meet them, and you think to yourself ‘Wow, I’ve read about this person 40 times, just to get a half hour coffee is amazing’,” he says.   “And then they turn up and they feel the same way and it’s like ‘wow, this is weird’.   “You realise all these other super successful entrepreneurs are in exactly the same boat and that never goes away. They’re all doing it for the first time, they’re all making it up as it goes on, they’re basically making smart judgment calls and getting 80% of the decisions right. Ploughing ahead and continuing to be bold. They don’t get timid as the stakes get higher.”   That point – all entrepreneurs are the same, all are learning on the job, all are “making it up as it goes on”, permeated the entire conference. Throughout the day, it was impossible to miss the many conversations going on between founders after advice and investors, or the successful entrepreneurs taking time to give it to them, regardless of who they were.   It was a point Niki Scevak later picked up on.   “If you look around the investment landscape you have all these people that believe in cliches that aren’t true,” he says.   “They want to invest in proven founders, with a great management team, in this really, really big market, as if any of those are knowable at the time you get to invest.   “All of these great success stories that Australia has been home to, they were started by, no offence, people with very little experience who had just finished university, no business experience, they looked like complete jokes and not only that they were entering into markets that were incredibly crowded.   “You’re actually looking for first time founders that look like a joke, it sounds a bit silly, but founders know that. Founders know it’s a complete mess at the start. It’s not actually about that, it’s a couple of levels deeper and what unique insight do you have.”   As Fishburners general manager Murray Hurps pointed out as the conference closed, when he began his startup 16 years ago, there was nobody to help out with that mess.   That’s since changed thanks to the many co-working spaces and community leaders like SydStart conference coordinator Pete Cooper, as some of the many founders in attendance pointed out.   SimpleNutrution.me founder Nathan Murphy spoke of the value of SydStart to people like himself.   “SydStart is like a big family reunion every year where you get to see old faces, share war stories and hopes for the years ahead,” he says.   “You gather around the elders and listen attentively to their advice for finding success.”   For Play2Lead founder Theresa Lim, SydStart was not just about advice but also a place to recruit her team.   “I was only expecting to potentially (meet) developers who I might add to my team or investors who might be interested,” she says.   “No only did I achieve that goal, but I made several customer leads from enterprise as well.   “I’ve had so many doors open to key customers through this (Fishburners and SydStart) community. Everyone is driven and helpful – the event itself inspires me to just keep going! Pete Cooper and Murray Hurps are tirelessly dedicated to making our startup community thrive.”

A new name and fewer neck-beards for growing SydStart

8:53AM | Wednesday, 27 August

Australian startup conference SydStart is considering a name change, in order to reflect its growing prominence as a national startup event.   Founder and event coordinator Pete Cooper says the event’s reach encompasses far more than just the Sydney area, with international and interstate representation growing each year.   SydStart 2014 will be held at the Hilton in Sydney on Tuesday September 2 and features 120 exhibitors, and over 50 speakers and panellists, including the likes of Freelancer CEO and chairman Matt Barrie, and Atlassian co-founder Mike Cannon-Brookes.   “It’s easy to get the headline numbers growth, but the hard part is to get the sheer range,” he says.   “We’ve got everything from IoT (Internet of Things) in the home, to bespoke fashion and high volume, high capacity cloud services.   “We’ve got a huge percentage of women entrepreneurs this year, which has been part of a steady trend. My teenage daughter has been a big motivator for me to get away from the neck beards, they’ll be there and they are still some of the nicest and smartest guys, but the sheer range is great.”   220 startups applied for SydStart’s pitch event. These were narrowed down to 30 finalists. The Top 10 will pitch on the main stage at SydStart in front of a host of potential investors, while the next 20 finalists will get the chance to pitch on the expo stage to help them build awareness.   The Top 10 finalists include:   BLRT - Communication   Go Far - Driving optimisation   You Chews - Catering marketplace   Thinkable - Research marketplace   Coalfacer - Research marketplace   UrbanOutsource - Home services marketplace   Stockspot - Financial advice   Rbutr - Crowdsourced rebuttal   Next For Sale - Property pre-marketplace   Touch Payments - Mobile payments   Cooper says he was unsurprised the Top 10 was dominated by marketplace startups.   “I’ve seen this trend coming for years,” he says.   “I think it’s a combination of the Australian education system, we’re not narrowly educated so marketplaces are a natural thing. So Australia is well placed because of the diversity in our education, our history of good commerce and the force of law.   “Australia is a natural place to build great marketplaces, look at Design Crowd, 99 Designs and Freelancer.”   Over 1000 people are expected to attend this year’s event, which Cooper describes as “the hobby that ate my life”.   “It was supposed to be a part time thing I do a few weeks a year, but it’s become enormous,” he says with a laugh.   Follow StartupSmart on Facebook, Twitter, and LinkedIn.

Aussie startups shine at 500 Startups’ demo day

7:18AM | Thursday, 31 July

Three Australian startups from the Sydney-based seed funding program Startmate stood out at 500 Startups’ demo day for its ninth batch.   Venturebeat selected over-50s online dating service Stitch, photo organiser and enhancer Lumific, and crowdsourced sport predictions service SportHold as three of the five startups that caught the publication’s eye at the demo day.   Stitch was co-founded by Andrew Dowling, who is one of the Startmate program mentors, while both SportHold and Lumific were both took part in Startmate’s 2014 program.   The mentor-driven program offers $50,000 in investment in exchange for a 7.5% stake and access to countless networks and mentors.   Startmate co-founder Niki Scevak was not surprised they were making an impression.   “This is all fantastic evidence that Australia is producing great tech founders,” he says.   Scevak played down Startmate’s influence, crediting the Australian startup ecosystem more broadly, saying Australia and its startups continue to punch above its weight.     "5 startups that caught our eye from 500 Startups' Batch 9" - 3/5 are Aussie & from @startmate. Truly great program. http://t.co/wGqabRmruR — Mike Cannon-Brookes (@mcannonbrookes) July 30, 2014     In addition to highlighting three Australian startups, Venturebeat went even further, suggesting in a separate article that Dropbox should look at acquiring Lumific.   “I sure hope file-sharing company Dropbox sent someone down to 500 Startups’ demo day today because they should really talk to a nifty little startup called Lumific,” the article says.   “…Lumific would actually make for a perfect addition to the way Dropbox’s users interact with the photos they store in their Dropbox accounts, which the company has been increasingly refining,   “And Dropbox should really buy it.”   Scevak chuckles at the suggestion, noting it’s not Startmate’s preferred outcome.   “It probably does make sense but we don’t want them to sell,” he says.   “The core value of Startmate is to try and create something really big and durable that will last a really long period of time.   “Sure some exit early in their lives, and people fail lots of the time, but the passion we have at Startmate is for playing the long game.”   Applications are now open for Startmate’s 2015 intake.

Startmate opens applications for 2015 intake

7:54PM | Sunday, 27 July

Sydney-based mentor-driven seed funding program Startmate has opened applications for its 2015 intake, with the iconic program now entering into its fifth year.   First run in 2011, the Startmate program was a pioneer in the Australian startup scene. Based on an observation that VCs were missing in action in Australia at the time, it was inspired by the success of US-based seed funding programs such as Y Combinator and Techstars.   Startmate and Blackbird Ventures co-founder, Niki Scevak told StartupSmart the program has proven Australia has the talent to build world-class tech companies.   “If you look at something like 500 Startups or Y Combinator, a large proportion of the teams there are international and they’ve moved to San Francisco to start their business,” Scevak says.   “But really, you can launch a startup anywhere and we believe Australia punches well above its weight in terms of talent.”   Scevak says the big change in 2005 will be the increased importance of Startmate graduates from past years.   “The big change after five years is the network of alumni companies. We’ve invested in 29 companies over the years, and that network is increasingly becoming even more important to the program than the mentors.   “The folks who have gone through Startmate want to give back to the program, so the alumni and the mentors is really a one-two punch.”   Startmate initially offered startups a $25,000 investment in exchange for a 7.5% stake – a figure that has since been increased to $50,000 (which gives successful companies a valuation of $666k). Aside from the investment, the program offers startups office space and legal advice for its duration, and includes demo days where technology can be demonstrated to potential early-stage investors.   A key feature of Startmate has always been the use of high-profile mentors from the Australian startup and tech community. Some of the mentors have included Atlassian co-founders Mike Cannon-Brookes and Scott Farquhar; Tjoos co-founder Bart Jellema; and Spreets co-founder Dean McEvoy.   The first program in 2011 generated 86 applications, which were eventually narrowed down to just five participants. The first intake was made up of Bugherd, Chorus, IRL Gaming, Grabble, and Noosbox. By the end of the year, one of the participants, Grabble, had been acquired by the US retail giant Walmart.   Between January and April 2012, Startmate returned with its second intake, with the program increased to eight participants. The number of aspiring entrepreneurs and startups boomed to 164, with Clique, Flightfox, Property Inspector, Invc.me, Ninja Blocks, ScriptRock, Setkick and Young Republic eventually chosen for the program.   It returned bigger than ever in 2013, with the initial investment doubling to its current level of $50,000 for 7.5% equity. The 2013 participants included 7pm Anywhere, Bugcrowd, GetStall, Kinderloop, SalesTeam, Shiftr, Storyberg, and Tutor on Demand.   In late 2013, applications opened for Startmate’s fourth intake, with the 2014 program kicking off earlier this year. The participants included Lumific, HayStackHQ, Inductly, Drawboard, Flirtey, Foogi, Composure, and SportHold.   In 2015, Scevak predicts Startmate will attract more than 250 businesses, with the growth of applications now tracking the number of startups in the ecosystem.   Applications for the 2015 program are available on this page.

BRW Rich List revealed: tech entrepreneurs fresh faces among the usual crowd

6:04PM | Sunday, 29 June

Miners and property developers are among Australia’s wealthiest people, but young technology entrepreneurs are snapping at their heels, according to the 31st BRW Rich 200 released Friday.   Gina Rinehart once again topped the BRW Rich List with an estimated worth of $20.01 billion, down from $22.02 billion the previous year.   Anthony Pratt, chairman and chief executive of paper and packaging company Visy Industries, came in at number two and is Australia’s richest man, with a net worth of $7.64 billion. James Packer came in at third place with $7.19 billion.   Despite the usual pack of miners, property investors and those born into wealthy families dominating the list, people who have made their fortunes from striking it out alone in the IT industry are quick on their heels.   Former Smart50 winners and Atlassian founders Mike Cannon-Brookes and Scott Farquhar have surged ahead in this year’s rankings, coming in at number 35 and 36 respectively. Between them, the pair is worth $2.14 billion. Last year the entrepreneurs were worth $250 million each.   Atlassian, a software development company founded in 2002, has averaged 40% on year growth for the last five years.   Cannon-Brooks and Farquhar have been hailed as examples of how Australian tech companies can thrive on the international stage. However, the pair also has their priorities set on other things besides profit.   In April, they pledged $35 million to community-building after setting aside 1% of the company’s equity to charity when starting the business. Farquhar told SmartCompany Atlassian has a passion for investing in charity for the long-term, especially when it comes to giving people the skills to help others.   “It’s really about education,” he said. “Ideally in 50 years’ time we want to say we have really achieved fixing something rather than just patching over something.”   Another entrepreneur, Ruslan Kogan, also fared well and came in at number 162 – his first time making it onto the list with a net worth of $320 million. Kogan’s business is going from strength to strength, and launched in New Zealand in March.   “Our goal is to deliver the latest technology at market leading prices,” he toldSmartCompany. “Whether it is manufacturing our own Kogan products, or sourcing the world’s biggest brands, we can cut out all the middlemen to guarantee the best prices.”   Mining magnate turned politician Clive Palmer didn’t fare too well in comparison to previous years, falling a massive $980 million in comparison to last year. However, fellow miner Andrew Forrest had the opposite fate – his wealth jumping from $3.66 billion to $5.86 billion this year.   The average age of those on the BRW Rich 200 is 64, and of the 200 people on the list 39 of them are billionaires. Only 7% of the rich-listers are women.   The richest people in Australia: 1. Gina Rinehart - $20.01 billion 2. Anthony Pratt & family - $7.64 billion 3. James Packer - $7.19 billion 4. Frank Lowy - $7.16 billion 5. Ivan Glasenberg - $6.63 billion 6. Hui Wing Mau - $6.35 billion 7. Andrew Forrest - $5.86 billion 8. Harry Triguboff - $5.5 billion 9. John Gandel - $4.08 billion 10. Kerr Neilson - $3.35 billion   This article originally appeared on SmartCompany.

Atlassian pledges $35 million to charity: Founders call on entrepreneurs to do more

4:31AM | Monday, 14 April

With Atlassian’s latest share sale valuing it at $US3.3 billion the Australian software company has pledged $35 million to charity.   Founders Scott Farquhar and Mike Cannon-Brookes set aside 1% of the equity in Atlassian to the Atlassian foundation when they started the company.   Farquhar told SmartCompany the foundation is part of the “untold” story of Atlassian and the latest valuation means it is now a $35 million foundation on paper.   Like Atlassian’s business plan, Farquhar says the company takes a long term view to its charitable giving.   “It’s really about education,” he says.   “Ideally in 50 years time we want to say we have really achieved fixing something rather than just patching over something.”   Farquhar says the Atlassian foundation concentrates on education rather than services such as homeless shelters which, while vital, don’t really address the root cause of the problem.   So far the Atlassian foundation has focused on charities such as Room to Read which works on educating children in the developing world.   “Their motto is that world change starts with educated children,” Farquhar says.   In addition to the $35 million in foundation stock, Atlassian has donated another $7 million to the Atlassian foundation and $3.1 million of this has been on-donated to Room to Read.   Farquhar says Australia does not have the culture of entrepreneurial giving like the United States.   “We want to encourage other entrepreneurs to pledge 1% of their equity early on when it’s not worth much,” Farquhar says.   “Then, like Atlassian, hopefully in the future it is worth more.”   This article first appeared on SmartCompany.

The long-term view is the secret to Atlassian’s success

4:04AM | Thursday, 10 April

Atlassian’s $US150 million ($A159m) share sale announced yesterday has rocketed co-founders Scott Farquhar and Mike Cannon-Brookes into Australia’s billionaire rankings.   Farquhar talked to SmartCompany from Los Angeles last night as news broke of the deal which values Atlassian at $US3.3 billion.   Farquhar and Cannon-Brookes are each believed to own close to 40% of the share capital and neither is selling down their stake as part of this sale, which leaves them with paper wealth of $1.4 billion each.   Farquhar says the deal was brokered by “inviting bids from a small number of select parties” and will assist Atlassian’s future growth through an injection of both capital and expertise.   “We have always been about thinking long term so the investors we get on board, like Accel Partners, help us set up the company for the next stage of growth,” he says.   “As we head towards an initial public offering we’ve now got one of the largest tech investors in the US on board and with their public market experience they will really help us set up.”   “It also allows our employees, some of whom have been around for 10 years to realise the value of their Atlassian stock.”   Farquhar would not be drawn on the timing of an IPO for Atlassian but it is “not in the next few months”.   The share sale is the latest move in a trajectory which has seen Atlassian soar to global prominence. In 2013, the business booked revenue of $US149 million up from $US111 million in 2012.   Farquhar says revenue is on track to be “north of” $US 200 million for this year. He attributes Atlassian’s success to “taking a long term view of everything we do”.   “At Atlassian, we want to be around in 50 years’ time,” he says.   Farquhar plans to grow the business further by expanding into multiple markets.   “As software development becomes an increasing part of every single business, our products actually become quite critical to every business,” he says. “That’s the area for growth of us.”   Atlassian plans to achieve this growth without hiring a single salesperson.   “We are not anti-sales; we are pro automation,” Farquhar says.   “We take an engineer’s philosophy to everything that we do. We are really about scaling the business.”   Although Farquhar concedes eventually Atlassian may have to follow a more traditional sales path if it wants to sell into large businesses at the top instead of going through the business’ developers.   “In the future we may have sales situations where we need to speak their language,” he says.   The biggest challenge at the moment for Atlassian is its stellar growth according to Farquhar.   The business has averaged 40% year on year growth for the last five years.   “We are growing fast. With that comes the inevitable issue of scaling, it sounds mundane but finding office space when you double in size every two years is hard.”   Atlassian’s move earlier this year to shift its domicile from Australia to the United Kingdom caused some soul searching in Australia’s tech scene but Farquhar insists Atlassian is still an Australian company “through and through”.   “We still collect all our revenue globally through Australia and the large number of people we are hiring are through Australia,” he says.   Farquhar says the move followed a global search to find the best place for Atlassian to be based “for the best interests of the company”.   Atlassian’s “back office people” analysed where Atlassian’s customers were, where the team wanted to live and settled on the United Kingdom.   “We looked at Singapore but the UK made sense because of the treaties between Australia and the UK it is easier and the global investor base is more used to investing in a UK company.”   But Farquhar does say the talent pool in Australia is limited.   “We don’t graduate enough computer science graduates from university,” he says. “That is the biggest constraint on our growth.”   “We have a unique company culture so we spend a lot of time on hiring for promotion and continuing that culture. I think half our staff have been here less than one year and four months.”   Atlassian has previously criticised the government for its approach to 457 visas for skilled employees and Farquhar says the program is essential because the Australian technology environment has more jobs than people to do them.   “Arrogance and lack of a strong industry in Australia meant we didn’t have mentors for a long time,” he says.   “Our argument with the government on these visas is that a lot of the people who could train us are highly qualified people we need to import from Silicon Valley.”   “Now we have mentors in our business and also on our board.”   This article first appeared on SmartCompany.

Google launches e-book celebrating the stories of Australia’s rising startup sector

4:46PM | Tuesday, 1 April

Google Australia has launched a campaign, armed with an e-book and video, to encourage Australians to take up coding.   Written by Fran Molloy, Start with Code shares the stories of the rising startup ecosystem, including startup founders including Noller, Peter Bradd, Marita Cheng and Mitchell Harper.   In the foreword, Communications Minister Malcolm Turnbull writes about the profound changes the internet and technology have wrought on the world.   “We need to improve the way we teach our kids; we need to inspire a generation of digital natives who are already avid consumers of technology to embark on careers as entrepreneurs and coders, in e-commerce and as engineers.”   The need to overhaul the education system to equip Australia with coding skills is something Atlassian cofounder Mike Cannon-Brookes also argues for in the book.   “At Atlassian, we know in the next 20 years we are going to have to hire a truck load of computer science people. We’ve got to start breeding them way earlier. We need to train them, at school, now.”   The investment in tech skills and the startup community, both key themes in the book, are argued for by accelerator founder and investor Niki Scevak.   “People call it a brain drain, I call it a brain boomerang, where they’re flying over but they’re coming back a few years later and bringing all that skills and knowledge they’ve had in Silicon Valley back to Australia.”   Google has also launched a video with the book, which celebrates Australian innovation so far and suggests learning to code is a fundamental step for any aspiring inventor today.   Check out the Australian inventions such as boomerangs, notepads, utes, wine casks and Wi-Fi in the video below.   {qtube vid:=THEpcW7vFkc}

Do you remember your first time? Twitter launches tool to help find your first tweet

3:45AM | Friday, 21 March

In celebration of its 8th birthday Twitter has launched FirstTweet, a tool that helps users find the very first message they sent.   We take a look at what some of Australia’s top startup folk had to say in their first tweet.   First off, here’s mine, clearly not aware of the location irrelevance of social media:   Anyone here from Perth, Australia?— Bronwen Clune (@bronwen) February 3, 2007   And StartupSmart journalist Rose Powell took the opportunity to be excited about being on Twitter:   @kirifarrell I know, I feel like this weekend went so fast. And looook, I'm on Twitter!— Rose Powell (@rosepowell) May 13, 2011   The Fetch’s Kate Kendall’s first tweet was in that awkward third person thing we used to do:   is being a night owl— Kate Kendall (@KateKendall) June 15, 2008   Atlassian cofounder Mike Cannon-Brookes tweeted about tweeting:   is making his first twitter post - and feels like a twit - albeit a connected one apparently!— Mike Cannon-Brookes (@mcannonbrookes) January 7, 2008   Muru-D’s Mick Liubinskas wanted us to know where he was:   Working from home in Woolloomooloo— Mick Liubinskas (@liubinskas) September 25, 2006   Canva Founder Melanie Perkins went for something fairly safe and vanilla:   Enjoying San Fran and all the exciting tech events it has to offer.— Melanie Perkins (@MelanieCanva) June 5, 2011   Twitter has asked users share their initial messages using #FirstTweet. 

Is portfolio investment theory friend or foe to entrepreneurs?

1:19AM | Tuesday, 28 January

Atlassian co-founder Mike Cannon-Brookes and Artesian Ventures managing partner Stuart Fox debated the impact of portfolio investments approaches, where an investor backs many start-ups with smaller amounts in the hope one or two works, at an event in Sydney last week.   Cannon-Brookes, who also called for Australian start-ups to stop selling their companies so early, described portfolio theory as problematic for start-ups.   “I want portfolio theory to be on my side, not on his side. Even at Blackbird (a start-up investment fund), the problem with a lot of investors is they want the portfolio theory on their side and I don’t think they should. Stay away from big corporates, they can get you into all sorts of trouble,” Cannon-Brookes said.   Fox shared Artesian’s plans to invest in between 500 to 1000 start-ups in the next five years and how portfolio theory was key part of their approach.   “If we’re going to invest in 1000 start-ups and they’re all billion dollar exits, we’re going to double the market cap of the ASX so that’s not probably going to work,” Fox says, adding the approach was likely to increase in popularity as new investors join the angel community.   ‘If we want external investors, we need to make this look attractive to investors who, no offence, are going to have a portfolio approach. They’re going to price it against not just the people in the room, but also against other asset classes.”   Cannon-Brookes added technology investors make most of their money on the one-in-a-hundred companies.   “You need to believe you’re the one in a hundred or you’re starting a different kind of business,” Cannon-Brookes says. “The greater proportion of the returns flow to the winner and that’s it. In almost any kind of technology, the winner takes it all and everyone else is well who cares.”   With this in mind, portfolio theory leaves underperforming start-ups more vulnerable. Fox explained they were quick to get rid of start-ups that have started to fail.   “Our sh-tty ones we turn the oxygen off. I don’t want to be harsh, but we turn the oxygen off. We’ll hit an idiot bid first but that’s the same,” Fox says.   “If anything comes out of my view, it’s that we’re not prescriptive. We want to get in really early on a lot of things,” Fox says, adding Artesian is backing got a couple of great companies who aren’t looking at maximum value of $20 million.   Artesian Ventures has also recently launched VentureCrowd, a crowdsourced equity platform that will open in February. Fox said it should open up further funding opportunities as it will have a lower cost (minimum $1000) to access than an angel investment ($10,000 and up).

Leading accelerator program Startmate opens applications for fourth intake

10:26PM | Monday, 7 October

Designed to turn Australian technical founders into successful global entrepreneurs, one of Australia’s first start-up accelerators Startmate is now open for applications.   The program will run next year from January to May. Companies will spend three months in Sydney and two in San Francisco.   Startmate is seeking around eight companies, which will receive $50,000 in seed capital, in exchange for 7.5% equity.   Startmate co-founder Niki Scevak told StartupSmart they’re seeking founders with big dreams and plans.   “Beyond the very product centric technical team, we’re looking for people with large ambitions, the crazier the idea the better. We really want to work with teams who want to make a big difference in the world, so the scale of the ambition is what we’ll be selecting,” Scevak says.   He says they’re committed to approaching each pitched idea with an open mind, adding that being the hundredth start-up to tackle an idea didn’t hurt Google, Facebook or Atlassian.   “Anyone doing anything in an incredibly crowded area will be taken as seriously as brand new ideas. The ideas may sound incremental, but it really does matter why the founders have chosen to pursue this idea, and if they have a unique insight into it,” Scevak says.   “It’s about why they care about their customers and if they have an authentic connection to the market. We look for what in their lives have driven them to this idea.”   The program includes an impressive line-up of mentors including Atlassian co-founders Mike Cannon-Brookes and Scott Farquhar; Tjoos co-founder Bart Jellema; and Spreets co-founder Dean McEvoy, as well as several partners from Square Peg Capital and Blackbird Ventures.   This will be the fourth intake for the program. Previous participants include BugCrowd and NinjaBlocks.   Start-ups can apply via Angel List.