The start-up founders who graduated last night from Queensland’s ilab technology incubator Germinate program have had an intense three months of planning and pivots. This is the fifth intake to graduate from the program in two years. All 10 start-ups selected for the program graduated with a demonstrable product. Program director Bernie Woodcroft told StartupSmart the diversity of the entrants was the most exciting element of this graduating class. “Seven of the start-ups had founders who were juggling mortgages and kids but still wanting to deliver an entrepreneurial outcome. I find that very impressive.” Two of the enterprise start-ups have trials confirmed with major corporations and several start-ups will be receiving some of their first payments in the coming months. “Most of the start-ups will stay on in the ilab space from now without the accelerator program wrapped around them,” Woodcroft says. Navigation algorithm start-up CB AeroSpace co-founder Michael Creagh told StartupSmart the best thing he learned was that mastering the technology was only one factor in the business success. “The business solution will need a marketing strategy, a network of people, intellectual property protection and involving the professional world from markets to accountants to lawyers,” Creagh says. The start-up will enable a much cheaper version of existing navigational systems. Creagh says the increasing uptake of drones bodes well for the commercial potential of the start-up. “As someone from a technical background, the biggest challenge for me was narrowing down all the advice and filtering through many different opinions to work out what to do,” he says. “In the end I went half with my gut feeling, and the rest from weighing people’s input based on their experience in this area.” The program is funded by the Queensland government and part of the University of Queensland’s commercialisation arm, UniQuest. They recently launched a $1.5 million fund for the program in partnership with Artesian Ventures. In a statement, the Queensland Minister for Science, Information Technology, Innovation and the Arts, Ian Walker, said technology start-ups will be agents for diversification of the Queensland economy. “As a government, we need to create the best environment we can to help get new products, services and innovative processes to market,” Walker said. Applications are now open for sixth intake and close April 8. The team behind ilab also recently ran a rapid, mass mentoring event for start-ups in the Indooroopilly area.
A co-working space for start-ups in the advanced technology industries such as medical devices and nanotechnology has launched in Melbourne. The Tap co-working space is an initiative of the Small Technologies Cluster, which has been running an incubator for similar start-ups for years. STC’s head of marketing and business development, Laura Faulconer, told StartupSmart while start-ups all face similar challenges, advanced technology start-ups face complicated hurdles such as regulatory approval. “We were looking at the emergence of co-working spaces globally and really recognise the value in that, but didn’t see any in Melbourne that really catered to the needs of the advanced tech sector,” Faulconer says. “If you’re a medical device start-up, it’s not as useful to set opposite to someone who is selling shoes online. There just aren’t the same synergies to work together.” The space can fit up to “30 butts on seats” at any one time, but Faulconer says 30 is a conservative estimate of how many people will use the space as the majority of it will be flexible. They will also run networking and education events in the space. “We designed it promote that collaborative work environment that has been embraced by the digital start-up sector, but has been slower to emerge here. Some of that is about culture and personality of the people involved, so we’ve taken that into consideration when designing the space,” Faulconer says. Advanced technologies also include biotechnology, life science and information technology.
When investment tool SelfWealth went looking to raise around $3 million to bring its information technology in-house, it considered but then rejected accessing venture capital sources. While it may be the dream of many start-ups to progress from early stage investment from angels to larger funding from the venture capital sector, for SelfWealth managing director Andrew Ward it wasn’t the right fit. “The valuation they put on the business was a lot lower than we thought,” he told StartupSmart. “And their position on being strict on exits and potentially taking on debt made my board nervous.” So instead of going down the venture capital path, SelfWealth “turned on our heels” and went back to its early backers, including carsales.com chief executive Greg Roebuck, and other high net worth individuals. The strategy is paying off for the company, which allows users to build and compare investment portfolios with others and has been described as the “Facebook of investing”. It’s added 10 new investors, raised $2 million with another $1 million expected in the near future. Ward advises other start-ups that don’t want to take on venture capital funding to go back to their original investors. Also, when pitching for series A funding, let new potential investors know who’s already invested. “When we went back to our strategic investors it all happened quite quickly,” he says, adding that previous investors were happy to talk to others about why they invested in the company. Among the 10 new investors to come on board is Australasian Wealth Investments, an ASX-listed investment fund. Last year, SelfWealth raised $1.6 million through the Australian Small Scale Offerings Board, with 21 investors taking part in the raising. Ward also suggests that other start-ups seeking investment not take money “for money’s sake – although you can get desperate”. “You don’t want to take cheap money, you want smart money,” he says, urging founders to ask how potential investors can add value to the company. “I know every one of our shareholders,” he says.
Fed up with the waste and expense of unused building materials going into landfill, builder Neil Turrell and wife Leisa came up with the idea of an online platform to buy and sell construction site leftovers. Since launching in October last year, buildBITS is now receiving around 61,000 visits a month as tradespeople, many of whom are sole traders, seek out second-hand goods or put up for sale excess material they want to get rid of. “It’s bringing the industry together without treading on toes,” Neil told SmartSolo. BuildBITS allows tradespeople to list on the website for free items like doors, windows, steel, timber and bricks they no longer need which other tradies can search for and buy. Neil says the site does not take a cut of any purchase but takes advertising from building industry suppliers, which allows the site to be free for users. He says with the building industry in Australia currently in a slow spot, builders and tradespeople have been attracted to buildBITS for materials as they seek to keep costs down or make a few dollars by selling what they no longer need. “It’s easier to sell than to throw out,” Neil says, adding that disposal costs in Australia are “through the roof”. He says he came up with the idea for the website while he was pulling out a kitchen – “it was beautiful” – and thought it was a “joke” to throw it out. Neil asked a friend who was involved in the information technology industry to investigate his idea. “He said it’s a goer,” Neil says. “Because things are so tight in the building industry and while things are a little quiet, I thought I’d have a go.” He says he’s been “pleasantly surprised” by the positive reaction to the site by tradies, with the number of products being placed on the site growing by around 11% a month. Neil says the next step for the site is to redesign the home page to make it easier and simpler for users.
Mobile video start-up Incoming has highlighted the demand for mobile video content after securing $1.1 million from OneVentures, NICTA and the US-based Citrix Startup Accelerator. Incoming, led by chief executive David McKeague, specialises in mobile content delivery for mobile platforms, delivering high-definition video to mobile devices based on user preferences. It pre-loads content using available WiFi networks, eliminating the need for streaming or buffering, while reducing the cost. Incoming TV is available as a mobile app. Some 600,000 users have already downloaded the beta version and three million videos have been played. Last year, Incoming was selected as one of 23 start-ups for Tech23 2012. Now it has secured $1.1 million in seed financing from a number of investors. The round was led by One Ventures, an Australian venture capital firm that invests in innovative companies in the information technology, life sciences and clean technology sectors. Funding also came from NICTA – Australia’s Information and Communications Technology Research Centre of Excellence – and Citrix Startup Accelerator, based in Silicon Valley. Incoming, based at Australian Technology Park in Sydney, is NICTA’s 11th spinout company. Incoming TV has been developed specifically for mobile phones and tablets. Its predictive support for the service draws from information on the user’s device, including contextual data such as time of day, location, usage patterns and interests, and social and physical behaviour. It then applies NICTA’s machine learning techniques to pre-fetch a suitable selection of video material. NICTA research leader Dr Max Ott joins Incoming as its first chief technology officer. Paul Hoff, NICTA's director of technology transfer, told StartupSmart NICTA has invested a total of $400,000 in Incoming. Citrix Startup Accelerator, meanwhile, invests in start-ups creating the next generation of cloud infrastructure services, mobile enterprise solutions and collaboration technologies. In addition to a $250,000 convertible note investment, start-ups have access to an advisory panel and office space in Silicon Valley. According to McKeague, who is currently overseas, Incoming allows mobile networks to be used more proficiently in off-peak periods. “The mobile industry estimates that over 20% of subscribers watch mobile videos on any given day, accounting for over 50% of global mobile data traffic on wireless networks,” he said in a statement. “This is costly for users, carriers and content providers. The Incoming TV service addresses this by pre-loading content using Wi-Fi networks.” Dr Michelle Deaker, managing director of OneVentures and a NICTA board member, said in a statement Incoming has a “significant opportunity” to capture and support video mobile delivery in global markets. “[This means] effectively unlocking 30 to 40% of untapped mobile network capacity, which is likely to be worth up to $20 billion by 2016,” Deaker said in a statement. Michael Harries, chief technology officer of Citrix Startup Accelerator, said in a statement Incoming’s technology is “compelling and complementary” to Citrix offerings. “Citrix Startup Accelerator invests in only the best entrepreneurs and new businesses creating new solutions for today’s problems in cloud infrastructure and mobile,” he said. “We look forward to working with Incoming as they build a world-class business.” According to NICTA chief executive Hugh Durrant-Whyte, Incoming is an “impressive example of NICTA’s research and entrepreneurial capabilities”.
Key players in the Australian tech start-up scene have lashed out at Prime Minister Julia Gillard’s suggestion the 457 visa program is being abused by the IT industry.
While research shows Australian women are among the most entrepreneurial in the world, they continue to be underrepresented in major sectors such as finance and information technology.
High-profile American entrepreneur Tony Perkins has highlighted US investors’ increasing appetite for Australian companies, ahead of Australia’s first-ever AlwaysOn conference.
What kinds of start-ups are most likely to get funding this year? What are the hot sectors in 2013?
Almost a quarter of Australians are planning a career change this year, while hiring intentions are mixed among employers, according to separate pieces of new research, suggesting many people could be looking to go it alone in 2013.
Start-ups often underestimate the time required to raise capital, says the co-founder of Starfish Ventures, following a $2 million investment in an email and web communication company.
A lack of risk-taking and a preference for service-based industries has been blamed for a shortfall in start-up investment secured by women, after US research revealed female-created ventures receive 8% less funding than men.
Materials science start-up TenasiTech will ramp up development of its polymer technology after securing $1.4 million in grants and equity capital from the Queensland Government and Uniseed.
Tech start-up Paloma Mobile has raised $1.5 million in a Series A funding round led by local venture capital firm OneVentures, despite launching less than a year ago.
Business degrees are becoming less desirable among Australian students, with research showing applications for management and commerce degrees declined 15.4% over the decade to 2011.
There are five founders behind the Brownie Points enterprise, who bring a huge level of experience across sales, marketing, information technology, creative design and branding.
The Federal Government has spent $225,000 to establish the Australian Sports Technologies Network, which is designed to foster the growth of sports technology start-ups.
Australian women are the most entrepreneurial in the world, new research reveals, but an expert says businesswomen are still underrepresented in growth industries such as finance and IT.
New Zealand tech start-up WaveAdept has been acquired by US-based Google Apps partner Cloud Sherpas, which is on the hunt for acquisitions in the Asia-Pacific region as part of an ambitious growth strategy.
The number of Android phones sold in Australia in the first three months of the year rose by 45%, according to new figures, suggesting that many entrepreneurs are looking beyond Apple when choosing smartphones.