About halfway through the 2014 AngelCube program, Sam Lee and Mark Robinson realised their startup idea wasn’t viable. So they decided to head to the pub, along with AngelCube co-founder Adrian Stone, and that’s where they came up with the idea for Class, a hotel booking app, which they say is the world’s fastest. What is Class? Class is a mystery hotel app combined with traditional hotel loyalty program perks. Users drop a pin in the app general area where they would like to say. A list of hotels, four star and above, appear with as much details about the rooms, without giving away the hotel’s name. Unlike traditional loyalty programs, Class is not tied to any one hotel, meaning users can book a number of hotels, and still receive rewards like free upgrades, dinners and bottles of wine. “We’re not just going after people who are going after secret hotels, or last minute hotels. We want to convert all the people who book normal hotels transparently too,” Lee says. “It’s an experience play. We’re targeting frequent travellers, weekenders, or people booking hotels to take their missus to the city for the weekend. They’re not particularly bothered with the brand name as long as its decent quality. As long it’s a fair city price.” Robinson bristles a bit at “experience play” characterisation. “I love Class because it’s literally hassle free,” he says with a smile. The power of Mexican beer and banter Hotels that appear on the app are curated and an algorithm helps narrow down that list by calculating the average city price. Lee and Robinson, who both moved to Australia from the United Kingdom, met during a “night of taco filled banter”. “We basically got pissed on Mexican beer and ended up deciding that we both wanted to start something,” Lee says with a laugh. “Three weeks after we met we flicked an application to AngelCube thinking it was a real wild card.” About a month after sending their application, Lee and Robinson found themselves sitting across from AngelCube co-founders Stone and Nathan Sampimon pitching their original idea Lift, a fitness app. Lee and Robinson are coy on the details. “We’re convinced it’s still a good idea, it’s going to get done by somebody,” Lee says. Sampimon and Stone were not convinced. “Nathan and Adrian were like ‘love the team, hate the idea’,” Lee says. So Sampimon and Stone gave them a week to prove the idea, and 24 hours to read Eric Ries’ book The Lean Startup. At the time, Lee was working 6am-12am shifts at Crown Casino, but Sampimon and Stone were unmoved. Lee says their response was simply, ‘If you want it, get it done’. “So I was under the desk at Crown, reading this lean startup book for the rest of the day,” Lee says. After a day of multitasking Lee would finish the book, and was able to explain how the concepts in The Lean Startup applied to the startup they were pitching to AngelCube. It was enough to be accepted. Shortly after, they began to realise their fitness app might not work. Lee says it took them a week to disprove the theories behind Lift and realise they needed to go back to the drawing board. Hitting the airport lounge scene After “knocking heads” with each other and “hitting the whiteboard a million times”, they settled on developing a hotel booking app. The idea came from Lee and Robinson’s experience as business travellers. Stone agreed to join as co-founder and they got to work. Robinson, a developer by background, started fleshing out what a Class app might look like, while Lee went in search of customers, specifically business travellers at Melbourne airport. After walking around with a survey at the terminal he realised the best answers were going to come from travellers in the business lounge. So he bought a virgin flexi business ticket to get entry, which he could get a refund for later, and spent the day chatting to people about Class. “I was subtly pitching to them and it allowed us to get really quality feedback. The great thing is you’ve got a captive audience there. It’s the only place where business travellers sit still,” he says. Most of Class’ fellow startups in the AngelCube program had some form of traction when they entered AngelCube, but Robinson says Class didn’t really launch until the 12th week of the 13-week program. It’s been in the months following the program’s end that Class has shifted its focus onto user acquisition. That will remain the focus for the months ahead while also making the reward system completely automated. Soon the startup hopes to launch in the United States. Class’ competitors aren’t trivial. They include travel giant Expedia, which recently purchased Wotif for $700 million and Rocket Internet’s Hotel Quickly. Lee and Robinson are aware of the scale of the challenge, but aren’t discouraged. “We’re funded essentially. So we’re just working our arse off in terms of proving the concept and getting our app ready to flick to the states. It’s a huge opportunity for us,” Lee says. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Vision, ability to execute, and global ambitions are the qualities Melbourne-based accelerator AngelCube is looking for from applicants for its 2015 program. The accelerator opens applications for its 2015 intake on February 23 offering $20,000 in exchange for 10% equity, six months of free office space, 13 weeks of training and access to a network of mentors and partners in Australia and the United States. The program culminates with demo days in Melbourne and Sydney followed by a US roadshow through San Francisco and New York. Previous graduates have come from a wide range of industries, including digital currency startup Coinjar, smart light bulb manufacturer LiFX and enterprise productivity tool etaskr. Last year LiFX raised $12 million in Series A funding from Sequoia Capital, Coinjar opened an office in the United Kingdom and etaskr closed a seed funding round. AngelCube co-founder Nathan Sampimon says the program is continuing to target startups from a board range of industries. “We’re at the position right now in Melbourne that there is a rich, organised community of tech talent, so we’re still as broad as ever,” he says. “AngelCube’s mission is to help the startup ecosystem by producing founders and startups that make their mark on the global stage, and set an example for others in the ecosystem to follow.” This is AngelCube’s fifth year, and for the first time the program has brought on a full-time program manager, Amir Nissen, who started the Melbourne Accelerator Program, and who participated in the Startmate accelerator as a founder in 2013. “This year AngelCube is focused on investing in exceptional teams,” he says. “Most startups will pivot during the program, maybe even a few times, so ambitious, technical teams with the resilience to survive and thrive in this environment are what we’re looking for.” Sampimon agrees and says the accelerator is looking for applications from founders who don’t just have “a high level crazy idea” but are able to articulate why they believe in it. “Lean startup is all about validating and testing your assumptions,” Sampimon says. "We don’t just want a high level crazy idea, with no evidence of viability, or no indication that there’s something of substance there.” An information night for AngelCube’s 2015 program will be held at Inspire9 in Richmond on Tuesday, February 24. For more information, visit AngelCube.com.
The harsh reality is that failure fucking sucks. Don’t let the startup mantras and hashtags fool you. Failure is emotionally draining, physically exhausting and psychologically frustrating. In some circles, it’s externally glorified, and in others, overwhelmingly demonised. I know this today, more than most days. Today we shut the doors down on OutTrippin, our company, our baby and the love of our life for the past two years. Notice how I struggle to even say the word failure in that sentence? It’s not a strategic choice of words; it’s just agonising to say the words: My company failed. I keep telling myself failure is an opportunity. Based on the generally positive demeanour I’ve had over the past few days, many might think I do believe it. Sometimes, I think I believe it too. I can logically draw the lines and understand why failure can be, and should be an opportunity, but sometimes logic just goes out the window. Because when I dig deep, behind the pleasant demeanour, behind the words, behind the actions, late at night as I lie awake, tossing and turning, a paralysing realization starts to sink in and the “truths” you keep telling yourself during the day can no longer mask the reality. Failure. Fucking. Sucks. It’s a funny little world. I remember when we started this adventure two years ago. Indi, my cofounder, and I met in a hostel in Buenos Aires. Traveling through, we became fast friends and when we happened to find ourselves in the same beautiful city a few months later, this time to live, ended up as flatmates and eventually as co-founders. We’ve been all over the shop, from Buenos Aires to Santiago, Melbourne to New York, and San Francisco to Dubai. We put it all on the line to realize our vision of what this world may look like if each person travelled more, travelled better and found experiences that they found truly amazing and eye opening. We think it would make us a happier people, a more understanding civilization, a more loving race. And so we tried. And try hard we did. We started OutTrippin, to build products that let people get personalised recommendations for truly amazing experiences on their travels. Our first product was a service that let travel experts compete to build your vacation. We took investment, we moved continents, we dealt with visa bullshit, joined an accelerator, found mentors and experimented with product, partners and business models. We failed, we learned, and we got up and tried again. And never thought that one day, we would get up to try again, but OutTrippin would not. We never thought OutTrippin would fail. Nine out of 10 startups fail. That’s a statistical fact (well, more like just an estimate). And yet, every account from an entrepreneur with a failed startup, the recurring theme always is: ‘I never thought my startup would fail.’ It’s the combination of the narcissistic nature of entrepreneurship (that I, as a single human can change this world of 7 billion people). It is also the stressed importance and almost glorification of hardship (Airbnb and their one thousand days of failure) that has allowed us to create this magical bubble of optimism. We allow ourselves to reach for unimaginable heights and work our asses off, all with the belief that we are the outlier – we are not the 90%, even if statistical reality says otherwise. And boy that bubble is simply amazing. It’s energising in the face of impossible (improbable) odds. It’s invigorating even in the darkest hours, when all seems lost, and it gives you permission to go after goals that most others have deemed impossible. Because, you, your beautiful, intelligent, passionate self is the person to achieve the impossible (improbable). And. It. Is. Glorious. Right up until it all comes crashing down. And 90% of the time, it does. Today, it came crashing down for my startup and my life for the past two years. People ask me, what happened? It all seemed to be going so well, I thought? I was back in Santiago, Chile in April 2013 when I was skyping with Indi on a Wednesday evening, who was stopping by Melbourne for a friend’s wedding. She said I’d love this city. She said I’d love all the cute hipster girls (she knows me well) and that we should totally think about moving there. I considered it for half a second and thought I’d see who’s investing in Melbourne on AngelList. After a few messages with Adrian Stone and Nathan Sampimon, by Friday morning just two days later, Indi was pitching OutTrippin to a crew of angels. We all got on a Saturday group skype, and by Monday AngelCube invited us to join their 2014 batch. The only catch was I had to move to Melbourne in four days – by Friday morning. Many would say “no way, that’s absolutely ridiculous”. For us, it was a no-brainer. A day of packing, some serious hustling for visas and few tearful and sudden goodbyes later, we were off to Melbourne, myself from Santiago and João from Portugal, just one week since Indi suggested we consider Melbourne as the next stop on OutTrippin’s journey. Startup founders get used to living on the knife’s edge because anything can happen. In fact, anything happens all the time. For every amazing thing I tell you is happening, there is an equally destructive thing that could also happen to the company. For every potential ascension and growth opportunity, there is a deep dark valley we could plunge into. Things can be amazing and terrible at the same time. For every huge deal we close, it can all fall apart before we’ve even had a chance to finish the champagne. So we learn to drink up quickly. We learn to manage the constant threat of things falling apart. We mask it behind the amazing potential. But masking it doesn’t make it go away. It’s always there. It’s a condition without a cure, the best we can do is manage it, mitigate it, and accept it. And that’s just how it goes. Sometimes it all comes crashing down like a house of cards. So what went wrong? I don’t believe that only one thing going wrong can kill a company. Usually it’s a catalogue of things that go wrong that brings any company to this point. It was no different for us. Everything that could have gone wrong did. That includes everything from business model failure, partial failures in team dynamics, general tiredness of doing this thing this long and go through yet another product and biz failure and a difficult investor climate in the travel industry. But, most of all, market dynamics pushed us onto a mountain that we kept trying to ascend only to eventually realize that that mountain was not our Everest. It wasn’t our Everest Startups are hard. And it’s not made easier when life things happen. Back in 2013, we were going through AngelCube, an intense three month accelerator program that essentially takes over your life. Similar to other accelerators, the non-stop ferocious nature of the program requires you to park your life entirely for 90 days and focus on your company and company alone. But life, as you might expect, makes other plans. From 7000 thousand miles away, I got a call no son should ever get: A hysterical sister and mother trying to tell you that your dad, the man who you could always turn to, is no longer there. And suddenly, everything changes. Everything that you knew to be true no longer is. Everything you knew about life is shrouded in doubt. Everything you were you no longer are. I left immediately to return home (obviously), leaving my cofounders to keep the company going while I tried to simply accept what had just happened. You never realise the strength of the bonds you create with those who you start a company with until it’s put to the test. We fought through what was the worst moment of my life and my co-founders Indi and João helped me put myself back together in a way that made me think that nothing could stop us from ascending our Everest, all because we had just survived the worst moment of my life. With all the sleepless nights, grey hair and the financial disaster that is your personal bank account, you’d think we’re nuts to go after the impossible (improbable) odds. But the truth is, when it’s a vision you so passionately believe in, everything else fades away. You say “who cares about the grey hair, I’m on the George Clooney aging plan”. You say “you’ll sleep when you’re dead”. Money schmoney, this is why you have credit cards. It’s all good if you can keep going after your vision. It’s all good as long as you have your Everest. And that’s why, it’s so very, very, very crucial to find your Everest. No other mountain is worth climbing OutTrippin was our Everest for a long time. But we were also open to following the market to wherever it might lead us. And this time, we were led astray. In the world of travel planning, finding a business model that works is like hunting for unicorns. It’s why there has been little to no competition to TripAdvisor on the travel planning front for the past decade. We’ve always had an amazing community of travel writers and bloggers and we’ve always had a concept that got people really excited. The problem has always been to find a business model that could scale. From OTAs to airlines, from content companies to hotels, we experimented for a sustainable route to create high quality expert generated travel content at scale. What a mouthful, I know. With a recently launched B2B (business to business) product targeting hotels, we came damn close too. But it dragged the company to a place where we dealt with slow moving behemoths and a B2B sales cycle that makes movements of glaciers look like that of a Ferrari. We could make peace with that, I think, but we couldn’t make peace with the fact that this wasn’t the mountain we wanted to climb. We wanted to focus on creating more magic with our apps on the consumer side. But without the revenue from hotel partners to cover content costs, it would all come crashing down like a house of cards. The travel industry’s investor climate is colder than the arctic. It is notoriously difficult. There are fair few success stories (Airbnb and HotelTonight are the only ones that come to mind and are essentially in the accommodation booking space) and there hasn’t been a legitimate challenger to TripAdvisor in over a decade. Investors are sceptical and rightfully so. Many don’t understand the space and those that do know exactly how hard it is. Either way, doesn’t make quite the savvy investment, does it?! What that means is that most travel startups are going to have to prove 10 times more than their counterparts for similar valuations and investment, all in an effort to overcome the industry bias. Doesn’t make it impossible, just a whole lot harder. And that just meant that we had become a company that did things the bootstrapped way. A specific conversation I had with my cofounder still rings out in my mind. I told her of a random idea I concocted in the shower the night before. It combined the Tinder and Swipe concepts, presenting amazing things to do in the city, and an ‘algorithm’ that would put together a timely version of an itinerary with the things you like most with the time constraints you had. Groundbreaking? Not at all. But her response is what was most telling. She asked: “How do we make money from this?” It wasn’t one sided, there were many conversations where I played the role of “show me the money!” We had just become a company with a “show me the money” culture. Remarkably, it helped us become self-sufficient and we probably made more revenue than most travel startups our stage, mostly because we had no choice but to keep on hustling. But it also left no room for errors. And it meant that any new idea came constrained with the question: How do we make money from this? And that, ultimately stifled our creativity. All that pressure took its toll on the team too. It did us no favours that part of the team, mainly João, was on the other side of the world with a 12 hour timezone difference. Sure, tools like Github, Google Hangout, Slack, Basecamp and countless others help you manage team workflow no matter where they are, but there are no tools to help manage emotions and morale. And startups are just as much an emotional journey as anything else. When the person you work with day in and day out sits next to you, you can see how they feel, when to push, when to support and when to get them a glass of wine or a gin and tonic. But when you have a two hour window in a day to work together, you barely have time to get past work to really get to know how they are truly feeling and how you might help. I caught up with Indi last week after her trip to visit family in Sydney, and mine to visit family in Dubai. It seemed like a moment away from the home base of OutTrippin had helped us clear our heads and understand who we were and what we believed. We had a glass of wine and our thoughts and, dare I say it, “feelings” just seemed to come rolling out. We talked about how this B2B product we created for hotels as the revenue and content driver for OutTrippin had become the bane of our existence. It seemed to have pushed us in a corner of the market we had no interest in. How the god awful B2B sales cycle with hotels made me crave a shot of vodka simply to answer an email. We talked about how it was convoluted that we never believed in this new product but were willing to do it if it made it easier to pursue our core vision. About how the reality was that it didn’t. It didn’t make it easier to pursue. It didn’t follow our core vision. And it certainly wasn’t our Everest. Eventually, it became clear to us that it was tiresome to even feign excitement over this new direction we were taking, all to keep surviving as a company. We spent the past two years of our lives on OutTrippin because we were driven by the magical memories that we helped create. From sci-fi themed honeymoons in New York City to diving trips in Malaysia, from bachelor parties in Austin to a girls’ trip to Iceland, these stories and countless others that we’ve helped make are absolutely epic. And for this we are prouder than a dog with two tails. But the more we moved in this new direction to keep surviving, the more the magic faded. And that was the straw that broke the camel’s back. It was the stark realization that in an effort to keep surviving as a company, we had started climbing a mountain that wasn’t our Everest. And that wasn’t fair to our users, our customers, our community and it definitely wasn’t fair to us. There is no logic in building a company whose direction you no longer believe in So, it’s time for us to find a new challenge, and bring this crazy train we’ve been on to its final destination. As I sit here, listening to Frank Sinatra lay down some truth bombs, I can’t help but resonate with ol’ blue eyes: “I’ve been a puppet, a pauper, a pirate, a poet, a pawn and a king. I’ve been up and down and over and out but I know one thing: Each time I find myself flat on my face, I pick myself up and get back in the race.” And that, ladies and gentlemen, is life (and I can’t deny it). I feel a surprising ease that I cannot explain. Considering all of the above, one would think that I would be a wreck but it’s quite the opposite. I’m energised by the decision as opposed to burdened by it. There isn’t a trace of regret. Maybe it’s because I’ve made my peace with it. Maybe it’s because I don’t know what’s next but that excites the living hell out of me. Maybe it’s because I get to restart the search for my Everest, because I am just as thrilled to climb it now as I was when I started OutTrippin. Or maybe, just maybe, it’s because failure is just another opportunity to start again. This time, faster, better, stronger, and (most importantly) more intelligently. Kunal Kalro is the founder and chief executive of @OutTrippin. Kalro speaks four languages and is perpetually living out of his suitcase. He has spent most of his time last year in Chile, Australia, Dubai, India and US. This article first appeared on Medium.
Build and they will come. Except everybody knows that’s not how it happens. It was the harsh reality for AngelCube’s 2014 intake that this was also the case for their San Francisco demo day. Out of the 80 people that RSVPed for Friday night, there were only eight that rocked up, and not one of them investors. It's not a dissimilar experience to many outsiders holding their demos here. It was on Monday after they’d all regrouped following a tour of the Dropbox office, that their collective fustration was aired. But there was no backing away from the journey they had committed to make. “This is the real world,” AngelCube founder Nathan Sampimon told the troops. “In Australia you’re one of a few hundred startup companies launching this year. “The reality here is that there are hundreds launching every day and it’s hard to cut through that noise.” He encouraged the startups to spend the rest of their trip hustling as many meetings as they could. “Warm intros are the best, leverage your network, those of our mentors and mine, but whatever you do, don’t stop,” he told them. All the pitches on the night had delivered, many of them giving their best one yet. Moodswing, a social network for people to share their emotions, had rewritten their pitch the night before to emphasise the impressive traction they’d had in just five weeks. They managed to extract the most excitement from the small crowd, some of whom had taken the time to download and play with the Moodswing app. “It’s a pretty cool design,” said someone on the night. For Moodswing, the demo day had been seen as a pivotal part of their trip, aware that their likelihood of getting funding in Australia is limited. But lessons were learned. “The demo day reinforced that we need to hustle ourselves and nobody is going to do it for us. It’s up to us, and us alone,” says Moodswing co-founder Jake McKeon. Ediply, a concierge service for students looking to study abroad, had also spent the day before throwing out parts of their pitch, after getting some frank feedback. For them the lack of interest in the demo day did not affect how they feel about their product. “The demo day was just part of what we had to do,” says Ediply chief executive Peter Chapman. “The week in general has been beneficial. Just being here and being immersed in the culture around startups has been inspiring. “Things can happen really quickly. We spent some time at Yammer, which has a pretty impressive office, and it was only a few years ago they won TC Disrupt.” For Drop-In app cofounder Simon Rahme, which plans to monetise the last minute appointment market, there were no regrets. “It’s a dog eat dog world,” he says. “If it was easy everybody would be doing it.” With that, everybody headed to a co-working spot for the day and got down to hustling. Bronwen Clune is in San Francisco as a guest of AngelCube. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Kicking off a round of demo days that will be held in Sydney, San Francisco, Silicon Valley and New York, the latest round of AngelCube’s early stage startups did their best to impress a room full of investors and influencers in Melbourne, Tuesday night. First up for the night was Arcade, which hopes to gamify sales teams to keep them more engaged with their jobs. Made up of David Cherrie, Anthony Indraus, James McLaren and Ivan Wang, some of the team have experience working in sales at a telco for a number of years, so they’re initially sticking to what they know and will focus on the telco market here and in the US. They’re looking to raise $750,000. Dropin app, co-founded by Caron Roberts, Simon Rahme, was up next with their plans to monetise the last minute appointment market, with an initial focus on the hair and beauty industries. The team is set to release a new version of their app soon and is looking to raise $500,000. Ediply, which wants to be a concierge service for overseas markets, seemed to spark a lot of interest from the investors at the demo. The idea came about from the experience of the founders themselves when studying at overseas universities. The team is made up of Peter Chapman, Katrina Too and Tyler Horan, and is aiming to raise $1 million to take it to the next phase. Their initial focus is on Asia. The newest startup, having only worked on their idea for a few weeks after abandoning their original one, was Class. Founded by Sam Lee and Mark Robinson, and described as “Uber for hotel bookings”, it is aiming itself at the business traveller with a mobile app for booking premium hotels. The startup has an early deal with Radisson hotels, though have not launched their app yet. They’re hoping to raise $750,000. Moodswing was the only business to consumer play from the bunch, not traditionally an area Australian investors have been keen on to date. The app is a social network for your mood updates, based on the premise that people don’t like sharing their feelings on open social networks. The app has no monetisation plans to date, but have had strong “stickiness” from users returning to the app repeatedly during the day. Co-founded by Jake McKeon and Chris Long, they’re looking for $1 million in funding to grow and get traction. The last team for the night was BrandSpot, a site to manage all your digital branding assets, co-founded by Amanda Watts and Kate Lanyon. Watts and Lanyon came up with the idea having both worked with designers and agencies and coming across the inefficiencies that companies had when managing their branding assets. Their platform also converts supplied files into a number of formats. They’re looking for $500,000 to speed up development of some of the tools they want to create for their users. AngelCube co-founder Nathan Sampimon told StartupSmart that in the past AngelCube companies have been known for having great startup founders and solid traction coming out of the three-month accelerator program. This year is no different. “We've got some truly disruptive startups – Ediply are changing the way international students are placed in universities and closing a $10b gap in acquisition costs; Arcade are turning traditional retail environments into a sales arena to better engage workers; and Moodswing are revolting against the artificial state of social networks, allowing their mobile app users to thrive while sharing their raw emotions in a safe, supportive community,” he says. “When you put the metrics of traction, growth, engagement and retention up against the benchmarks for successful Silicon Valley startups, our AngelCube companies are serious teams with serious businesses, and further proof that Australian startup founders have what it takes to compete in the global market.” AngelCube’s Sydney demo day is on Thursday and tickets are available.
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.