The federal government should introduce “fast-path” grant applications for tech startups and treat accelerators as consultants for the purposes of grant funding under the new Entrepreneurs' Infrastructure Program (EIP), according to AngelCube co-founders Nathan Sampimon and Adrian Stone. The recommendations form part of AngelCube’s submission to the government’s policy review of the recently announced Entrepreneurs' Infrastructure Program. “These recommendations have to be taken up if the government wants the EIP to be useful for tech startups as well as ordinary businesses,” Stone says. He says the normal grant application process might work fine for small businesses, but for startups it takes far too much time. “Startups don’t want access to consultants; they don’t want access to funds where it takes three to six months before you’ve got access. “We can take a startup from an idea to a fully functioning business in three months.” AngelCube’s submission touched on the same point, highlighting the “lengthy, time-consuming and costly process” required to understand if a technology business is eligible for government assistance, and compared it to the rigorous but much shorter process used by accelerators during their selection processes. It made six specific recommendations: Venture accelerators are recognised as a new category to apply for Business Management Grants. Venture accelerators can apply directly under the three year rule for business management grants. Venture accelerators should be recognised as an ‘expert network’ for the nomination of Commercialising Ideas grants. The government should allow “Business management” grants of up to $100,000 for venture accelerators to support between 6-10 companies. Business Management Grants should be preapproved based on the venture accelerators’ initial commitment to provide a minimum of $20,000 to each accepted company, indicating an initial investment from the accelerator of $120,000 to $200,000. Allow a rapid process approval of the Commercialising Ideas Grant based on the due diligence conducted by Venture Accelerator and co-investors. Venture accelerators are a valuable part of innovation ecosystems and government can capitalise on this by recognising their existence as a category and supporting them, the submission concluded. “Venture accelerators provide an avenue for government to make a rapid impact and support the new technology businesses of the future,” it says.
Investors, founders, and an enthusiastic crowd of startup ‘wantrepeneurs’ packed into Inspire9’s Richmond offices last night to celebrate the launch of new not-for-profit Startup Victoria, which aims to grow the local startup community. Speaking to StartupSmart, Startup Victoria chair Leni Mayo said the Victorian startup scene’s biggest challenge is the lack of good product people. Mayo, the founding investor in a host of startups including 99Designs, Flippa and Learnable, hopes Startup Victoria can go some way in addressing the problem. “I think we are terribly weak at product, marketing, branding, sales, we really need to pull our socks up, but of those the one that stands out far above the rest is product,’’ Mayo says. “In Melbourne I could pick 100 engineers and stack them up against engineers in your average Silicon Valley startup, and it’s a fair fight. “In product, we have less than half a dozen in Melbourne that would stack up, and probably less than 10 Australia-wide. “It’s a blend of human understanding, commercial nous and tech nous, and we don’t have enough people like that. We don’t value them enough.’’ Newly appointed Startup Victoria CEO Lars Lindstrom agrees. “The Americans are very, very good at that,’’ he says. “We need to improve.’’ Lindstrom has a wealth of experience in startups. Having spent roughly 10 years in investment banking in Melbourne dealing with billion dollar takeovers and mergers, he left the industry to cofound a startup, a free home distributed newspaper delivered in all the major cities in Denmark. That was in 2006, and within 12 months the newspaper, funded by advertising revenue, became the most read in Denmark, and employed over 1000 people. Lindstrom says the company was close to breaking even when “Lehman Brothers cracked”, as a consequence advertising revenue dried up, and that was the end of that. Not dissuaded from the startup industry, in 2009 he returned to Australia and co-founded the world’s first eBook reading software ReadCloud aimed at schools, where he remains chairman. ReadCloud has a catalogue of over 100,000 eBooks and distributing deals from the world’s major publishers. Under the leadership of Lindstrom, Startup Victoria will run a “better founders” program which will bring together experienced, practising startup founders to discuss the best way to tackle large fundamental problems facing the Victorian startup scene, like the lack of globally competitive product people. “It will involve different startup founders talking about stuff deeply concerning and important, and the people around that table need to come up from a large shared experience,’’ Mayo says. “This is an area Startup Victoria can help through better founders, because it won’t just help the founders, but also their employees.’’ The program has parallels with a similar effort being made by Inspire9 founder Nathan Sampimon. In addition, Startup Victoria will also run a “more founders” program which will be open to anyone interested. “We’re trying to create an institution where you have access to real information that can help you along the way, as opposed to getting opinions,’’ Lindstrom says. “We’re trying to be more scientific about it and give best practice. “Not necessarily guarantee their success, but point them in the right direction.’’ Startup Victoria was launched with the support of the Victorian government, which provided $100,000 worth of seed funding.
Melbourne-based accelerator AngelCube is searching for up to 10 fast-growing companies for their fourth intake, with applications opening in early March. Launched in 2011, AngelCube is Melbourne’s only private accelerator not run by a university. In exchange for 10% equity, AngelCube companies receive $20,000 in seed capital, six months of free office space, 13 weeks of training and access to a network of mentors and partners in Australia and the US. Co-founder Nathan Sampimon told StartupSmart AngelCube’s mandate has evolved as the Melbourne start-up eco-system developed. “In 2011, we wanted to grab some easy wins, so anything slow-moving or slow growth we steered away from. We do want to be able to cultivate these companies, but we want to put Melbourne on the map for having successful accelerated start-ups first,” Sampimon says. Fast-growing graduates include bitcoin start-up CoinJar, responsive lightbulb start-up Lifx and interactive app preview start-up App.io, and Kickfolio, which is now based in San Francisco. All three have raised more than $500,000 in venture capital. He adds they’ve been breaking the rules since day one. For example, the AngelCube co-ordinating team in 2011 was keen to avoid accelerating in a hardware start-up, but have had considerable success with Lifx so far. Companies still need to be fast growing to be selected for the program. “The program is intense and not for everyone. It’s only 13 weeks long so if you’re in a slower moving start-up, you won’t be able to iterate fast enough to get the most out of it,” Sampimon says. The AngelCube team are seeking strong teams as they recognise ideas will change. “Most start-ups will pivot during the program, maybe even a few times, so the idea doesn’t need to be perfect,” Sampimon says. An information night is being held at co-working space Inspire9 in Richmond on Tuesday, February 25.
A new, Google Australia-sponsored start-up incubator program, Melbourne NEXT, will launch next week at the York Butter Factory co-working space. The five-week program for 10 start-ups will focus on customer discovery, idea development, fundability, pitching and launch strategies. Event coordinator and community manager at Google Developer Group Leon Gouletsas told StartupSmart the program was specifically created for pre-accelerator or launch start-ups. “This program is designed to address that post-idea pain point for entrepreneurs. It can be quite challenging to work out how to get into accelerators or what you require for early stage launch,” Gouletsas says. “They need a bit more idea refinement and business model development. We saw that gap, and we’re really keen to up the maturity of the Melbourne start-up scene.” The program includes seven local mentors from entrepreneurial and investor backgrounds: Leni Mayo, Stuart Richardson, Nic Hodges, Laura McKenzie, Dave Slutzkin, Nathan Sampimon from Inspire9 and Marc Harrison. This is the first time the international program has been run in Australia. Over 30,000 entrepreneurs have graduated from programs held in 25 countries. “The first ever event was in the Middle East. It was deliberately chosen in some of the more interesting parts of the world because it seeks to bring together entrepreneurs regardless of background to work in collaboration,” Gouletsas says. Gouletsas adds the program focuses on customer discovery strategies. He estimates the course will take 20 to 25 hours a week, including three hours of class time. “What we’re really about is getting out of the classroom. The mentors are helping the entrepreneurs focus on value proposition development, and customer acquisition and segmentation opportunities. They’ll talk about what to do outside the building, and how to tackle these big questions,” Gouletsas says. The program will not be requesting or seeking equity commitments from the program members. While the program isn’t specifically targeted at tech start-ups, Gouletsas they will be heavily favoured in the selection given the backgrounds of the mentors. “The most important thing for us is they need to attend all the sessions, be fully committed and be ready to build their start-ups,” Gouletsas says.
A start-up that sees travel experts pitch itineraries for holiday-makers and an e-book publishing platform for writers and bloggers are among the teams chosen to join seed accelerator AngelCube’s 2013 intake program. Melbourne-based AngelCube received more than 150 applications to join its three-month program that will focus on targeted mentoring. AngelCube co-founder Nathan Sampimon told StartupSmart that AngelCube looked for start-ups with “big vision”. “We want co-founders that are hungry and want to change the world,” he says. “There’s really got to be that hunger, the need to shake some stuff up.” The seven start-ups selected to join the program include, for the first time, an international entrant. AngelCube says on its website the co-founders of BattleTrip have flown from Chile, Portugal and New Zealand to join the program. BattleTrip sees travellers set out where they want to travel, when and what kind of trip they’d like. Travel writers and bloggers then pitch itineraries and the traveller chooses which one they like. Other start-ups joining the program include: Tablo Publishing – an e-book publishing platform c8apps – fantasy sports apps using social networks CoinJar – reconciling Bitcoins to dollars eTaskr – a task marketplace that solves underutilisation of resources within organisations LifeGym – an app that helps women build fitness through real-life rewards Ozirig – a marketplace connecting wholesalers and photography professionals AngelCube says it’s attracting investor interest in Australia and internationally after two graduates from last year’s program secured funding. It says Wi-Fi light bulb developer LIFX has raised $1.3 million through crowdfunding platform Kickstarter, while app tester Kickfolio, now known as app.io, has graduated from US-based accelerator 500 Startups and closed its Series A funding round with $1.075 million.
Entrepreneurs have spoken of their experiences at the “start-up pitch-fests” held for the Advance Innovation Program, highlighting the importance of preparation and the structure of your pitch.
AngelCube co-founder Andrew Birt says he’s impressed by the quality of applicants for the incubator’s next start-up round, saying it reflects Melbourne’s maturing start-up ecosystem.
AngelCube, the Melbourne-based incubator, will open applications for its second round of start-ups tomorrow, increasing its intake to eight teams, with a special interest in marketplace concepts and software-as-a-service.
Tech start-ups need to build up their brand and achieve market traction before they can secure funding, according to the co-founder of Melbourne-based tech incubator Angel Cube.
Serial entrepreneur Andrew Birt is looking for Melbourne-based start-ups to become the first group of participants for his latest venture AngelCube, an early stage incubator for web-based businesses.