Aussie business Flow Hive has raised the most money ever on crowdfunding platform Indiegogo. Entrepreneur reports father-and-son entrepreneurs Stuart and Cedar Anderson now have the most funded project in the platform’s history, raking in $US5.3 million ($6.91 million). The Andersons created a system which allows beekeepers to harvest honey on tap, without disturbing the hive. After a decade of research and development, the duo launched their business, Flow Hive, on Indiegogo two weeks ago with an initial target of $US70,000 in 42 days. It took just 477 seconds for the Andersons to reach their goal. The first 500 beehives, priced at $US600 each, sold out within an hour and the father and son hit the $US1 million mark in a record three hours. The Anderson’s decision to switch from Australian platform Kickstarter to US platform Indiegogo appears to have been validated by the high amount of investment from the United States in Flow Hive. Stuart Anderson said in a statement he has been thrilled and a little shocked by the response. “We’re just so grateful for all the support,” he said. “The aim of this has always been to make things less stressful for the bees and easier on the beekeeper. Now things are on a much bigger scale. Anderson said Flow Hive is working hard to fulfil its commitments to its Indiegogo supporters as quickly as possible. “There’s a lot to do, but we’re completely confident that we will meet our pledge as our supporters have met theirs,” he said. Andrew Ward, director of the Crowdfunding Institute of Australia and Crowd Sourced Equity Funding Australia, told SmartCompany Flow Hive’s success was likely to encourage other businesses to consider crowdfunding as a funding option. “Yes, I think if they have a popular business to consumer offering, then success like Flow Hive has had is more attractive than seeking angel investors,” he says. “There is significantly less cost in building a prototype and putting a video campaign together. At the end of it you have the money plus a committed fanbase who will keep the business going.” But Ward cautions crowdfunding is not the solution for all businesses. “With business to consumer services and business to business crowdfunding the jury is still out, they haven’t had anywhere near the same success as smart products.” This story originally appeared on SmartCompany.
The Australian father-and-son duo who raised more than $1 million within three hours on crowdfunding platform Indiegogo have now broken the $US4 million ($A5.1m) mark. Cedar and Stuart Anderson, from Byron Bay in New South Wales, have developed a way to harvest honey without opening a hive and disturbing the bees. The pair’s invention, called Flow, allows beekeepers to simply turn on a tap to retrieve honey instead of having to smoke the bees and take apart the hive. The Andersons’ initial target was $US70,000 – however, that goal was smashed in a matter of hours. The invention has now raised more than $US4.3 million to become the third most-funded project in Indiegogo’s history, with more than 10,000 people backing the invention. Co-founder of Flow, Cedar Anderson, told StartupSmart the crowdfunding campaign has been “a wild ride” so far. “We’re amazed and so proud of how well Flow has been received,” he says. “That we’re now the most successful-ever crowdfunding venture ever launched outside of the US is just incredible. The response has been humbling and has already far exceeded our expectations.” Anderson says the project’s success came down to the fact that people love bees. “We’re blown away and really hope this leads to increased bee numbers and better bee health around the world.” The most-funded project on Indiegogo to date was a device called Ubuntu Edge, which raised $US12.8 million in August 2013. Coming in at second place is the An Hour of Code project, which aims to give students in the US the opportunity to learn foundational computer science skills. The campaign raised just over $US5 million, with even a donation from Facebook founder Mark Zuckerberg. Flow, however, could easily surpass An Hour of Code as the invention’s crowdfunding campaign has more than 30 days left before it expires. Riding off this success, Anderson said in a recent post on the company’s Indiegogo page that it will be able to negotiate up to 50% off their backers’ shipping costs due to the groundswell in support from around the world. “Expanding manufacturing to the US will also reduce shipping costs for those in America or close by,” he said. “Where possible we will source the wooden hive boxes and frames closer to you to reduce shipping costs and support your local beekeeping suppliers. We will add some estimates of shipping soon. Once again thank you all so much for being a part of this project.” Follow StartupSmart on Facebook, Twitter, and LinkedIn.
An Indiegogo campaign for a beehive that allows beekeepers to harvest honey simply by turning a tap has become one of Australia’s most successful crowdfunding campaigns. Flow Hive, created by Byron Bay-based Cedar Anderson and his father Stuart Anderson, launched on Indiegogo on Monday looking to raise $70,000. Just one day later it’s already raised more than $US2 million ($A2.5m) That puts it ahead of the Kickstarter campaigns of Australian startups LiFX, which raised $1.3 million for its smart light bulbs, Ninja Blocks’s Ninja Sphere which raised $700,00, and 5 Lives Studios which raised £461,000 for PC game Satellite Reign. Traditional honey harvesting is quite labour intensive. Beekeepers need to don protective gear, use smoke to sedate the bees, and crack open the hive, which requires a lot of heavy lifting. Then they’d need to pull the frames out, brush the bees off the combs, transport the frames to a processing shed, cut the wax off each frame, and place them in an extractor. Finally any dead bees or leftover wax needs to be filtered from the honey and the frames then must be returned to the hives. Flow Hive allows beekeepers to install a tap on their hives, and use that tap to filter honey directly out of the hive. Special combs allow the honey to drain from the hive, without disturbing the bees and completely eliminating the traditional labour intensive process of harvesting. Cedar and Stuart spent the past 10 years developing Flow Hive, and the last three testing prototypes. Backers have already ordered over 1700 complete full Flow Hives at $US600 each. Cedar told SmartCompany the Flow Hive team are absolutely astounded by the reaction to the crowdfunding campaign. “After all these years of working on it you just can’t anticipate it,” he says. “This means we will be very busy and we will be employing the best help we can to deliver the hives to all our amazing supporters.” Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Crowdfunding platform Indiegogo is trialling a way for its users to receive a full refund should a project which reaches its pledge goal not go ahead. TechCrunch reports the option is called Perk Insurance and costs between 10-20% of the total pledge amount. The coverage is currently available for three projects and refunds a customer the full amount of their pledge – minus the insurance cost – should their perks not be delivered within the estimated timeframe. However, are we likely to see insurance taken up by other crowdfunding platforms? Not so, according to Pozible co-founder Rick Chen. “I can see why Indiegogo is planning to do this but from my point of view it might be a bit of a strange thing from the user point of view,” he says. “People don’t only want to buy a product – they want to give money to see it happen. So there’s a lot of emotion in it. When you put insurance into it… it doesn’t really mix well from my point of view.” All of the Indiegogo campaigns that currently offer optional insurance are tech startups, including a wearable band that helps monitor stress levels and an electric bike. Chen says while Pozible did not initially see many tech startups use the platform, that all changed when the company launched in China last year. He says making sure a startup can deliver on its promises to consumers is critical. “For all our tech projects, we need to see how your tech prototype works first,” he says. “That’s how we make sure it’s capable of delivering. And we build a whole ecosystem chain in China from early prototype, to small batch manufacturer to mass manufacturer to help project creators do the right thing. If they [Indiegogo] really want to focus on lowering the risk of fraud on the site screening will probably work better than having to pay insurance.” Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Reddit is asking its users to vote on which 10 charities should receive 10% of the startup’s advertising revenue for 2014. Ten charities chosen by the Reddit community will each receive $82,765.95. Ryan Merket, product manager at Reddit, said in a statement one of the things that helps everyone in the company get “out of bed every morning” is the knowledge they are helping people around the world. “For 2014 we decided to ‘decimate’ our ad revenues to support the goals and causes of the entire community,” he says. “That means for every $10 in ad revenue we received, we would be splitting $1 equally between 10 charities selected by our community. We closed the books on 2014 and our total revenue was $8,276,594.93. Meaning we are donating $827,659.49.” Indiegogo testing ways to refund money Crowdfunding platform Indiegogo is working on a way for its users to receive a full refund should a project they give money to not go ahead. TechCrunch reports the option is called Per Insurance and costs between 10-20% of the pledge amount. The coverage is currently available for three projects and refunds a customer the full amount of their pledge – minus their insurance – should their perks not be delivered within the estimated timeframe. Uber expands funding by $1 billion Popular ride-sharing service Uber has expanded its Series E round by $US1 billion to $US2.8 billion. The New York Times reports the additional strategic investment was led in part by Chinese internet giant Baidu. Uber is currently valued at around $US40 billion. Overnight The Dow Jones Industrial Average is down 0.19%, rising 33.62 points to 18,013.96. The Australian dollar is currently trading at 78.24 US cents. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
An Australian startup is looking to use crowdsourcing and mobile mapping technology to make people feel safer in public areas. Mappsafe, based in Melbourne, is a patented smartphone app that allows users to anonymously flag areas with poor lighting and anti-social behaviour. Founder Tea Maherl told StartupSmart these days people are sharing a lot of information about what they are doing – from what they are eating to what they are wearing. However, public safety is not something that is often talked about. “We wanted to start a conversation and create awareness,” she says. “When we have this information we can influence government and councils to change – if there isn’t enough street lighting we can go and say it’d be great if you have more lighting there. But if nobody talks about it the council will not see it as an issue.” Maherl also hopes the app will provoke a conversation about violence against women because as many as one in three women will experience violence in their lifetime. “We do have areas we don’t walk through because of the unsafety element,” she says. “And a lot of times in countries women still don’t have a voice. So with that we’re expanding the possibility to speak and talk about these issues.” The app is under development alongside a crowdfunding campaign on Indiegogo to help it get off the ground. Maherl says crowdfunding is a great way for the startup to engage with potential users and make sure the product is tailored to their needs. “I think it [crowdfunding] is a great way of putting the word out there for people to see it and supporting it,” she says. “As a startup it gives you a bit of an insight into the perspectives of others.” The app will initially be available on Android devices, and is expected to be available on the Google Play Store for $1 in March next year. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Is crowdfunding a viable way to fund a startup? Crowdfunding is a broad term and can easily be misunderstood. There are different ways to raise funds, including issuing shares (equity) in your company, selling products or services that the business will provide, and/or accepting donations. Different groups use crowdfunding, including startups, political parties, not-for-profit organisations and art societies. Businesses including Kickstarter, RocketHub, Equitise and Indiegogo assist start-ups to raise money from the public. How can private companies raise funds by issuing or selling shares in Australia? Businesses that crowdfund by selling products or services need to comply with the Australian Consumer Law. Companies that seek to raise funds by issuing shares must comply with the Australian Corporations Law provisions regarding fundraising. Generally speaking, the Corporations Act prohibits small businesses from approaching the public for capital without a prospectus. A prospectus can be time-consuming and expensive to prepare. Private companies can issue or sell shares to investors in the categories below, without a prospectus. Each type of investor is defined in the Corporations Act: Personal offers – to raise up to $2 million in 12 months from up to 20 investors. This includes retail investors. Business introduction or matching services like the Australian Small Scale Offerings Board. Placements to sophisticated investors who have a certificate from their accountant that their income is $250k or more and/or the combined value of their assets is $2.5 million or more. Placements to professional investors who manage at least $10 million in funds, and/or have an Australian Financial Services Licence. Placements to institutional investors i.e. offers made through financial services licensees. Offers to people associated with the body corporate or currently holding those securities, such as senior company managers. There are restrictions on how these offers can be advertised and promoted. How could equity crowdfunding help start-ups in Australia? It is generally seen as difficult for new start-ups to access these investors, and for the public, also known as retail investors, to invest in a start-up other than under a personal offer or being associated with the company. Equity crowdfunding would benefit start-ups by giving them access to capital from the public (retail investors). With equity crowdfunding, start-ups could advertise to retail investors who believe in their vision and have a desire to support them in the early stages. If equity crowdfunding was available in Australia, start-ups could be better funded. Start-ups may not have to resort to using their credit cards to raise money, or using their home as security for a business loan, or having to give up large percentages of the company and/or large amounts of control of the business to attract sophisticated, professional or institutional investors – if they are able to attract these investors at all. Crowdfunding risks The key risks of relaxing the equity funding rules in Australia are that start-ups may not be required to provide the same level of rigorous disclosure as is required in a prospectus. The business would also not go through the same level of screening that a bank would typically require to loan money to a business. On top of this, the business would not be required to comply with the detailed requirements to be listed on a stock exchange and the continuous disclosure requirements to maintain the listing. Equity crowdfunding progress in Australia VentureCrowd is the first, and currently only, equity crowdfunding platform to take off in Australia. It enters the market following the recent release of a government report recommending a shake-up to the regulatory framework of equity financing in Australia. The recommendations made in the report have not yet taken effect, making it difficult for ordinary Australians to invest in Australian start-ups. Another hurdle in the current legislation is that startups looking for equity crowdfunding must first become public companies. The report recommended that smaller, newer businesses become “exempt public companies” for a period of time, with a more flexible compliance requirement. After this period of time, the companies would progress to become fully-fledged public companies; easing the transition and helping start-ups take off. VentureCrowd are selective about which start-ups they choose to work with. Only start-ups that have been privately invested into or were once part of accelerator programs are chosen. VentureCrowd also do reference checks on these investors before committing their support. Just this week, VentureCrowd successfully sourced $1.2 million for the taxi app business Ingogo. While the majority of startups may struggle to attract private investment or accelerator graduation status, the round of investment is an important step in the right direction. It demonstrates how equity crowdfunding can give these technology-based startups the boost they need to get off the ground. Crowdfunding reform Liberalising the equity funding laws would assist start-ups to fundraise and build out their business, while allowing the public the chance to invest at an early stage. In another sense, however, the Australian Stock Exchange already provides a platform for businesses to pool funds from ‘retail’ investors. Canada, Italy, New Zealand and the UK are leading the way towards a more liberal framework. What level of initial information would the business have to provide to the public? How much ongoing information would the business have to provide to investors? How much influence would investors have in the business? Australia needs to address these issues to balance the desire of start-ups to raise money with the requirement for investors to be fully informed as to what they’re investing in. The government needs to act fast for Australia to secure a place in the international equity-crowdfunding arena. Ursula Hogben is the co-founder, COO and managing director of LegalVision ILP, Australia’s online legal services provider. Twitter: @Ursula.Hogben Ursula Hogben is the co-founder, COO and managing director of LegalVision ILP, Australia’s online legal services provider. Twitter: @Ursula.Hogben
The cofounder of a pioneering Sydney-based robotics startup, with a Powerhouse Museum display and a successful crowdfunding campaign under its belt, says the sector is set to get much bigger but finance for projects remains an issue. Robological cofounder Damith Herath told Private Media there are a number of exciting robotics startups founded by Australians, including Marathon Robotics and Navisens, and the sector is gaining momentum globally. “It’s kinda like the ‘70s in computing and the ‘90s in the web. It’s the same feeling in the robotics community and the general consensus is it’s getting a lot bigger,” Herath says. “A few good examples are some of the startups Google has recently purchased, or Baxter, or Cynthia Breazeal, who quit her job at MIT to do a startup called Jibo and raised $2 million on Indiegogo. “But we have to be careful, because a lot of people over-promise and under deliver. Robots will move into other spaces, though not in the anthropomorphic sense. “One of the issues is finding people to finance you is tricky, especially for hardware. People are more comfortable with apps and things that get a quick return on their investment.” In January, Robological raised $3031 on Indiegogo for Ro-buddy, a pre-built board that integrates with an Android app, making it easy to build a robot without needing to learn a programming language such as C. Herath says the startup is finalising the board for fabrication in China. “You can build a Raspberry Pi robot straight away, plug in a camera and motors, and within 10 to 20 minutes you have a spy cam working with the Android app,” he says. “We think it’s useful because it’s in the pro-maker space, but it’s not as complex as Arduino. So if you’re building something in home automation, you can get something going with Android.” Aside from Ro-buddy, Herath says Robological does consulting and research work, including working as a research partner with the Australian distributor for Rethink Robotics’ Baxter robot and on Curtin University’s Alternative Anatomies project. It is also “chipping away” on a variation of the cloud-based internet of things robotics ideas put forward by UC Berkley professor Ken Goldberg, although Herath is remaining tight-lipped about what the project involves. The startup began with a robotics display called the Articulated Head, which was on exhibit for two years at Sydney’s Powerhouse Museum. “The three founders – Zhengzhi Zhang, Christian Kroos and I – met at the University of Western Sydney six years ago on a project called Thinking Ahead, which was a project of the Australian Research Council into AI (artificial intelligence). “We each had a slightly different background, myself with robotics engineering, Zhang with software engineering and Christian with linguistic and cognitive science. “Stelarc is one of the top performing artists in the world; an Australian artist who’s done a lot of work with robotics on stage and theatre. And the project I worked on was conceived of by Stelarc.” The project ended when funding ended, but this allowed the team to develop valuable intellectual property on robots and human interaction. The founders decided to form Robological to continue their research. One of its first projects was called Adopt a Robot, a research project looking into interactions between humans and robots. “It got a lot of good publicity because it captured the public imagination. We gave away seven robots and over six months we changed its behaviour and added a face… Each person who got a robot had to care for it and fill out a questionnaire every four to six weeks,” Herath says. Next month, Robological will jointly organise a workshop on robots and art with Curtin University as part of the Sixth International Conference on Social Robotics in Sydney. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Could your Nest do with a little more Zen? Meet the Aussie startup building a simpler, smarter thermostat9:51AM | Friday, 5 September
Melbourne-based startup Planet Innovation has raised nearly $50,000 on crowdfunding site Indiegogo in just days for a device called Zen, which it claims is the first thermostat that is not either “extremely unattractive” or “too complicated to use”. Zen, a smartphone-controlled thermostat, is designed to work over Wi-Fi with iControl’s OpenHome Labs and other smart home systems such as Apple HomeKit. Aside from being controlled through an app, the thermostat can be controlled with a touch screen on the front of the device, rather than through push-buttons. It features a minimalist design, and is attached to the wall using magnets, unlike other thermostats that are attached with screws. Since starting the Indiegogo campaign on August 31, as of publication, as of publication, Planet Innovation has raised $47,895 of its $50,000 target from 333 funders with 26 days to go. While the device is likely to draw comparisons to Google Nest, Planet innovation marketing manager Roger Langsdon says it is likely to find a different market segment. “I think Nest has helped to take thermostats out of the dark ages, but it’s gone too far and become too complicated,” Langsdon says. “With Zen, it’s a simple design and the smarts are in the app, not in the device… There’s a whole market for people who want a beautiful thermostat, but who aren’t particularly technical. And Nest can be intimidating for them.” Principal industrial designer at Planet Innovation, Ben Druce, told Private Media Zen aims to be “smart” in the sense that it is simple to install and easy to use. “Another difference between us and Nest is the removal of a lot of the in-depth functionality. What we’ve done is present users with the bare minimum of what they need to do, and that’s control the temperature,” Druce says. “It did come about independently,” Langsdon says. “We’ve been playing with home technology and other thermostats for around three or four years now, we ended up putting the two together.” The crowdfunding campaign comes with most of the development work on the device already completed, with assistance from key staff from US-based firm MMB. “The product is well developed at this point. Don’t get me wrong – the money will be useful in setting up the factory tooling for mass production – but we’re mostly using it for market validation. “This is the easiest way of getting feedback quickly by putting it in front of hundreds of users all around the world in order to get feedback.” Langsdon says he would like to see Zen available on a mass scale, with the device already attracting attention from potential channel partners in both North America and Australia. “At the moment, we’re hoping to meet our target in the next few hours. For the team, it’s been an amazing journey. We finished in December and ship in January,” Langsdon says. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Last week, StartupSmart asked six successful Australian entrepreneurs and startup community leaders for the best piece of business advice they’ve received. The response to that article was so overwhelming that we’ve decided to ask six more entrepreneurs for their best business tip: Niki Scevak, Blackbird Ventures I think the best piece of advice I received was around how to receive advice itself. Make sure you understand who is giving the advice and why they might be giving it to you. Much like in poker, play the player not the cards. Understanding the context always gives the advice much more richness and usefulness. Also, when someone, even if they're rich or smart, gives you advice, unless it 'chemically reacts' with you, don't feel bad about throwing it away and not using it. You'll only be successful by being the best version of yourself. And as always, test the advice with customers for the final verdict of whether it's good or not. Pete Cooper, SydStart Two important ones for me: Keep asking yourself what is the most leveraged activity you can undertake. I got this from Ash Fontana (Angel List, originally from Sydney) when he spoke at SydStart last year. Don't pour money in (or quit your day job) until you look like getting product-market fit (i.e. until customer interviews or pre-orders show you have something people want to address a real problem). Laura Mariakinaite, Startup Grind Australia Have you got a business idea? Talk it out. And I mean it, open your mouth and let other people know. Pitching to yourself in your mind DOESN'T COUNT. Chances are you won't be able to verbalise your idea properly the very first time you talk about it. And if the first person you mention it to is a potential investor, co-founder, channel partner or a customer, your one minute elevator pitch might become a mess full of "hmm", "you know", "maybe", "I just want to". That's dismissive. If you want anyone to join your journey, let your assertive skills shine. Moreover, every single time you talk to someone about your idea, you may receive some invaluable feedback and questions that will help you shape your pitch further! That's a bonus. I have pitched different things in the last year, from Startup Grind sponsorship, to "Hey, if you like windsurfing, check out this new Vic Wind app", to approaching media to gain interest in Zen Thermostat that's being successfully crowdfunded on Indiegogo at the moment. Now I'm working with retailers to help them reach out to local office workers using Equiem portals designed for commercial buildings. Is it challenging? Yes, it is. But with time you become more familiar with what works and what doesn't. Finally, I was once told that if you are from overseas and have an accent, find someone local to do sales and pitching for you. That's a myth. But that's another story. Trust yourself and let the world know about your idea. Paris Buttfield-Addison, Secret Lab I think the best piece of business advice I’ve heard is to learn about tax, accounting, and budgeting for your company early on. Don’t leave it to the last minute, when things could go wrong – understand how money works in a business from the get-go, and plan your products and business from there – if you don’t at least attempt to understand this sort of stuff from the beginning, you’ll run into big problems down the track. David Mah, Blue Sky Shopping The best advice I've ever received was "focus, focus, focus”. Sounded simple when I first heard it but now I understand the critical importance of focusing relentlessly on a smaller set of high priority tasks and doing them really, really well. As an entrepreneur with a million things to worry about, it's easy to get side-tracked and distracted by 'new and shiny objects'. Learning to focus and say no to distractions has transformed the way I run my startup. Steve Orenstein, Zoom2u My best piece of advice is to just get out there and do it. It’s easy to waste a lot of time planning and talking about an idea. In just a few months, I’ve gone from having an idea to developing the unique technology to make it happen. If you have an idea, get out there and do it. Image credit: Flickr/laughlin Follow StartupSmart on Facebook, Twitter, and LinkedIn.
There has been a lot of buzz around “social entrepreneurship” and social startups over the last few years and with it a lot of confusion over what a "social startup" actually is. Whilst some camps define social startups as not dissimilar to a charity or NPO, others dismiss them as businesses using a social cause for pure marketing and differentiation purposes. To dig deeper into how and why social startups like these work and what makes a social entrepreneur tick, I asked these co-founders five questions regarding perceptions, motivations, challenges, success and future plans. 1. What is your definition of "social entrepreneurship / social startups" Brad Lorge, FoodBank Local: I see it as redefining profit to include something important to both the entrepreneurs and other members of the community. I think the best social startups have their impact and core business directly aligned. Prashan Paramanathan, Chuffed: There seems to be a whole industry of people who spend time trying to come up with a definition for 'social enterprise' - I'm hesitant to add to the muddle. Generally what I find is that there are two types of organisations that call themselves social enterprises: 1. Businesses that have a social purpose embedded into their actual trading activity (most commonly commercial businesses that employ some category of disadvantaged people or businesses that service the not-for-profit sector); and 2. Businesses that redistribute (a portion of) their profit to social causes (eg. charity water, who gives a crap, tom's shoes) Prashant Mehta, Conscious Step Social Entrepreneurship allows for a company to have a primary mission or focus on giving back or making the world a better place, while leveraging the advantages of being a for-profit company. Allowing advantages for developing better products, paying for better employees, and having additional funds to test and develop stronger and more unique marketing campaigns. 2. What motivates you as a social entrepreneur Brad Lorge, FoodBank Local: The same things that motivate me as a social entrepreneur motivate me as an engineer – we want to build something that has an impact for others. We want to make a contribution to our profession. Prashan Paramanathan, Chuffed: Tech in the non-profit sector is very often done very badly. Much of this is due to non-profits deprioritising tech spending, but it's also due to a lack of tailoring of products to the sector. Most often people assume that giving non-profits a free version of the software design for commercial customers will lead to a good outcome - it very rarely does. The sector needs products designed for the sector, by people who understand the sector - and understand tech. That's where I want to play. Prashant Mehta, Conscious Step: Motivation comes from delivering a better product than anything available in today's market, while creating awareness for the changes I'd like to see in the world. In the case of Conscious Step, providing people with fun solutions for the problems that affect our day to day lives. 3. What are some of the challenges and misconceptions for social entrepreneurs? Brad Lorge, FoodBank Local: Identity crisis is a challenge, and knowing the difference between good and bad ideas and practice. A misconception is that you need to give up on growth of investment because a social startup has a social objective. Social startups with the right business acumen grow faster, have stronger support and break through barriers better than any other. Prashan Paramanathan, Chuffed: The two that I worry about are: 1. Social entrepreneurs not focusing enough attention on whether there's a commercially-viable business case behind their venture. There's not enough focus on delivering a great product or service for your customer, which manifests in several ways including: directly copying businesses from the commercial sector and assuming they'll work for the non-profit sector; focusing too much on servicing a beneficiary, instead of a customer; or assuming that being a 'social enterprise' gives them slack in the market on delivering an excellent product. 2. As a social sector, we need to do a better job of attracting smart startup brains from the commercial startup sector. There is a very large bank of knowledge on how to run a startup well which needs to be imported into the social enterprise scene. I think we confound these startup skills with general 'commercial' skills and seek them out from experienced corporate types - this isn't the best place to get them. Prashant Mehta, Conscious Step: Some of the challenges as a social entrepreneur include: a) Financial Constrains - Most startups do not have a lot of financial backing. This forces you to really work to prioritize how money can be best spent to continue growth, but continually improving the back end of any business. b) Testing- Getting out of your head and getting feedback on whether your idea is viable, learning the best ways to generate profits and revenues, and understanding the main reason people are interested in your product or service. c) Networking- Networking is so important and can sometimes even be a bit costly. Meeting people in the same industry or working on similar projects can provide advise or knowledge that can save a lot of time, energy, and resources. More importantly, teams can usually accomplish more than individuals. More importantly the skills of meeting people and presenting can take one far in life. As for misconceptions, one of the biggest misconceptions among social entrepreneurs is that there social mission will be its primary driver. The truth is your product has to be superior to the rest of the market, offer competitive advantages, and a social mission and presence is the cherry on top. Mission driven companies, whether startups or major corporation are becoming more and more common, and almost now an expectation with increased awareness of the many issues around the world. 4. How would you summarise your success so far? Brad Lorge, FoodBank Local: We achieved a 70% efficiency increase for food distribution. We have partnerships with some of the biggest brands in the world as well as the biggest charities. Prashan Paramanathan, Chuffed: Since launching Chuffed.org in October 2013, we've grown by about 30% every month and will soon have raised over $1 million for over 200 social cause organisations in Australia. The biggest of these campaigns was for a sanctuary for rescued farm animals - Edgar's Mission - which raised over $162,000 from 1,785 donors in 14 countries, making it the largest Australian social cause campaign to run on any major crowdfunding platform. To support this growth, we have raised $460,000 in seed funding from the Telstra Foundation. Prashant Mehta, Conscious Step: Some of the press we've received early on includes our Indiegogo Campaign/Commercial , United Nations coverage, exposure during the Business for Good Competition, success in the BFG Pitch, Sydney SEED Fund Competition , Top 50 Social Entrepreneurs in Australia and finally a feature in the Women's Wear Daily/ Footwear News . 5. So, where to from here? Brad Lorge, FoodBank Local: We will keep building momentum behind a movement to push technology forward and end hunger. Prashan Paramanathan, Chuffed: We believe there is still a very large amount of room for growth in the Australian market, both in the rapidly growing not-for-profit and social enterprise sector, but also for crowdfunding in the school and university sector as well as for personal cause campaigns. We are also likely to expand internationally as broaden our product line to support more tailored online donation products for the social enterprise and not-for-profit sector. Prashant Metha, Conscious Step: Conscious Step intends to continue to raise money spread awareness for additional causes, while growing its presence in the U.S and Australian market. We plan to continue to educate people on the causes that are resulting in the most issues around the world, and simple ways they can get more involved and help create more solutions. More importantly, we intend to use organic materials and promote the values in fair-trade working condition to provide our customers with a superior sock experience. Joshua Flannery is Student Entrepreneur Development, International Education.
Last year US-based scientist Patricia Brennan was forced to defend the National Science Foundation’s decision to fund her study in duck genitalia, something the scientific community regarded as totally legitimate. It’s not an uncommon problem, and one the University of New South Wales hopes to address by launching Thinkable, a crowdfunding platform that aims to make it easier for the public to understand the value of scientific research. Thinkable founder and chief scientist Dr Ben McNeil, a researcher at the University of New South Wales, points out it’s often the most “curious” of projects that end up being most important. Take CSIRO scientist John O’Sullivan, who was investigating black holes when he developed a key patent used in Wi-Fi. “The importance of those crazy ideas hasn’t been well communicated. It may seem to be completely irrelevant, but the biggest discoveries often come from those areas,” McNeil says. “These types of areas of research are getting cut and it’s because it’s hard to argue the benefits. We’re trying to give anyone access to learn and fund and track this type of research if they want to. “In many ways specialisation creates a disconnect with more and more people. “The ability for people to connect with your research is dampened, paradoxically.” McNeil describes Thinkable as an open science platform where researchers at universities or research institutions will be able to display their projects, and if they want to, attempt to raise funding. Users will be able to learn about projects via quick video snippets similar to those found on Pozible and Indiegogo, and track their progress. “The complexity of science makes it inaccessible for a lot of people, but elevator pitches are the way to change that,” he says. “There’s this huge broken system of how the world connects to our work, as well as how we engage with the world. “Anyone can come onto Thinkable and learn, track researchers, see what they do and engage with them – that’s the number one priority for us.” Five University of New South Wales researchers are the first to showcase their projects on the platform, with ideas for studying ocean acidification, blindness, heart disease, alcohol consumption and obsessive compulsive disorder.” Thinkable is now calling on more researchers to join the platform and provide updates on their research. “Right now we’re building the community,” McNeil says. “We want to build an ideas network with cutting edge ideas from people who are doing really great stuff. “The initiative will not only accelerate discovery, it will build greater trust and communication between scientists and the public, by democratising science.” Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Recently, there was a potato salad that went gangbusters – but could a redesign of the classic Australian thong be the next big crowdfunding campaign? An Australian footwear company hoping to revolutionise the iconic Aussie thong has raised more than $10,000 on crowdfunding platform Indiegogo within an hour of going live. Willi Footwear, based on the Gold Coast, is looking to develop thongs that are “stylish” but avoid what it calls “the chance of a blow out” – a situation where thong straps break or come loose from the base. It has patented its design for an interchangeable “boomerang” plug, which, according to the project’s Indiegogo page, has been awarded in a number of countries. Founder and managing director of Willi Footwear, Brad Munro, said in a statement he hopes the crowdfunding campaign will help them launch their new brand of thongs in Australia and overseas. The company has already had enquiries from several overseas distributors. It says it needs to reach its $30,000 goal in order to pay for production and shipping costs, moulds and patent fees. Having reached more than a third of its target within two days, the thongs look set to hit the market just in time for the warmer months. Willi Footwear has enlisted brand ambassadors to put their names to the project – including former Cleo Bachelor of the year Trent Maxwell and three-time Ironwoman champion Courtney Hancock. The business is using the power of social media to drum up support, encouraging people to use the hashtags “nomoreblowouts” and “changeablestraps” to promote the crowdfunding campaign. BAM! #nomoreblowouts How cool are these #changeablestraps @WilliFootwear flip-flops. Help launch this Aussie product https://t.co/yu320Gado5— Rebecca Wiasak (@careceb) July 23, 2014 The thongs will come in a range of sizes and colours, and will allow owners to mix and match their straps in order to create a number of different colour combinations. A number of startups have been successfully crowdfunded in recent years. However it is the more wacky ideas that currently are the flavour of the month, encouraged after Kickstarter relaxed its submission guidelines. Earlier this month, an American man created a Kickstarter to source the necessary funds to make himself a potato salad. With just a few days left and an initial goal of $US10, the project has raised more than $US50,000.
A new Australian equity crowdfunding platform called Equitise is gearing up for launch, as the federal government considers the recommendations handed down in the recent CAMAC report. Currently, crowdfunding through platforms such as Kickstarter, Indiegogo and Pozible remain a popular way for startups and new ventures to raise capital. Under current regulations startups are only allowed to offer equity to “sophisticated” wholesale investors with more than $2.5 million in investable assets or annual earnings of around $250,000. A recent review conducted by Corporations and Markets Advisory Committee (CAMAC) on behalf of the federal government, released early last month, recommended opening up investment to anyone over 18, with a cap for “unsophisticated” investors of $2500 per company, to a total of $10,000 each year. The federal government is currently considering the recommendations, and is expected to announce its official position in October or November, alongside its official position on employee share schemes. As the government prepares its announcement, former Deloitte senior analyst and Search Party operation manager Chris Gilbert, along with his business partner Jonny Wilkinson, are preparing to launch their new platform. Gilbert told StartupSmart he hopes Equitise will help address the issues of funding and finance for innovative Australian startups. “Equitise is an equity crowdfunding platform. When I was at Deloitte and other businesses, I came to realise there was a huge problem with corporate funding in Australia,” Gilbert says. “Initially we’re using a pure equity crowdfunding model with funding upon completion of projects…. So if projects don’t get finished, funds get returned.” Gilbert says the new venture has already received funding from listed investment firm AWI. “We’re going to help educate investors and entrepreneurs to make early stage capital markets more efficient. We’re going to help educate investors and entrepreneurs to make early stage capital markets more efficient,” he says. In terms of the federal government, Gilbert says it’s essential that legislation based on the CAMAC recommendations is passed. “The Government needs to take what CAMAC have said and quickly pass the legislation and encourage ASIC to move fast so Australia doesn’t fall behind the rest of the world,” he says. Image credit: Flickr/torbakhopper
Tired of lifting and carrying those back-breaking loads? An Australian firm has launched a crowdfunding campaign for an autonomous robot that can do the hard work for you. Sydney-based robotics and drone manufacturer Lev Enterprise, founded in 2010, has launched an Indiegogo campaign to fund the Alpha Robot, which will be controlled through an app designed for Android tablets. The device consists of a platform mounted on six wheels, fitted with sensors, cameras and lights, with rechargeable batteries powering up to two hours of continuous operation. A purpose-specific carrying tray can be placed on the platform, turning it into a hydraulic scissor lift, a wheelchair for two passengers, or mobile solar panel. Depending on the model, it will have a total carrying capacity (including the carrying tray) of 250 kg, 500 kg or 1 ton. The device can either be set to work in ‘autonomous mode’, be remotely controlled through tablet, or be guided by a magnetic strip up to 50 metres long. Autonomous mode works by launching the control app on a tablet and then walking along the path you want the Alpha to follow. The path is automatically translated by the app into directions, which are automatically uploaded into robot. The Alpha Robot has a large potential market, with practical uses for a range of different businesses, including the removalist, warehouse, logistics, construction, farming, retail, emergency services and film industries. Founder Teeray Murphy told StartupSmart there has been a lot of positive reaction from businesses about the concept. “We’ve had quite a bit of interest in industries we visit. In the removalist industry, they require autonomous robots, and we want to make it affordable enough to be able to use in the home,” Murphy says. “We aim to make it as flexible as possible.” Murphy says the crowdfunding campaign will help Lev Enterprises move the project from the concept stage towards prototyping and testing. “We’ve spent the last four months working on the design and concept. Now we’re moving on to assembling components, building prototypes and testing,” he says.
Australia’s first cat café will soon open its doors after the owners announced they have found the “perfect location” nearby the popular Queen Victoria Market. Speaking to SmartCompany, Anita Loughran says the idea of a cat café in Melbourne came after her husband suggested it after visiting Japan for their honeymoon. “He just kind of threw the idea out there and I just couldn’t stop thinking about it,” she says. Cat cafés are popular in Asia, where customers can pat a friendly feline while enjoying brunch or a cup of coffee. Loughran says one of the biggest difficulties the business venture faced was complying with local council regulations. “It did take three months for us to get permission from them and with the permission there was a list of regulations we’re going to have to comply to,” she says. “We need to have airlocks between any food areas and the cat areas and just a lot to do with the health and hygiene side of things.” Loughran says this includes cleaning stations for customers to wash their hands with soap and hot water before and after touching the cats. One of the business’s other obstacles, said Loughran, came from property owners turning them down because they didn’t want cats to be on the premises. However, her advice to those with a quirky business idea is not to give up. “It can be hard, even in a city like Melbourne where there’s generally quite different things around and you’d think people would be more open minded,” says Loughran. “It’s just persistence and if one way of doing something doesn’t work, do it a different away.” Loughran says the business owes a lot to the popularity of cats on the internet. “I can’t tell you why cats have taken over the internet,” she says. “But it’s definitely helped us. We have got a lot of followers on social media.” According to Loughran, Twitter and Facebook were integral in raising awareness of the business idea. The business has more than 7000 likes on Facebook. The couple has also launched their last crowdfunding campaign on website Indiegogo in order to help cover refurbishment costs of the shopfront—a space which was a lot larger and older than they originally anticipated. “Reaching out on social media you never know who’s going to come back with some advice or help,” says Loughran. “It completely changes the way business is done.” Loughran says because the cat café is effectively going to be two businesses in one, they are going to start with a traditional café menu before trying anything adventurous with the food. “As the business grows we will be able to develop the menu and meals,” she says. Cat Café Melbourne will be located at 375 Queen Street, adjacent to the iconic Queen Victoria Market. Loughran says an online booking system will be set up on the business’s website in order to prepare for an influx of customers. The café hopes to be open by July and will be working with the Geelong Animal Welfare Society. This article first appeared on SmartCompany.
The Internet of Things movement is really starting to pick up pace in Australia, according Optus Innov8 Seed lead principal Alfred Lo. Optus Innov8 Seed is throwing the spotlight on the Internet of Things at this year’s Vivid Ideas Festival in Sydney. On June 4 the Australian tech-startup investor will holding an event titled The Internet of Things – From Electric Dreams to Digital Reality as part of the festival. “I think globally it’s emerging,’’ he says. “It’s really moved along at a rapid speed in the last two years.” Lo puts down the rise of IoT to what he calls “fundamental changes” that have made the movement more accessible, whether it is the advent of 3D printing, or the rise of crowdfunding platforms like Kickstarter and Indiegogo. “All of that has created a perfect storm to allow IoT around the world to take off,’’ he says. “Our ecosystem is really booming. IoT is something that is not often talked about as much as the web-based startup. “Hardware is always hard, there isn’t as many skills, there’s not as many people doing it, but it’s certainly growing and some of those startups are participating are showcasing our event.” Lo says finding knowledgeable IoT people is more difficult than finding software developers. “Software’s eating the world,’’ he says. “The tools to do software have been around longer and are easier to access. “For hardware, you need more gear, the setup cost is higher, the barrier for entry is a bit harder, I think that might change.” Optus Innov8 Seed is holding a pitchfest at the event, predominantly aimed at IoT startups that haven’t launched their products yet. “I think it’s a great opportunity to find out about the Internet of Things landscape globally, and more specifically locally, to find out about the talent we’ve got growing here,’’ Lo says. “There will be tech demos set up after the main event and there will be the opportunity to play with the tech, which is quite different from a usual startup event. “Entrepreneurs, investors and corporates will have an opportunity to look at what is potentially a disrupter in the market.” To apply for the pitchfest, visit Optus Innov8 Seed’s blog. Applications close 5pm, May 13.
The Google Glass Explorer program seems to be faltering. So much so that Google has taken the unprecedented step of dispelling the top 10 myths around Google Glass in a blog post. “In its relatively short existence, Glass has seen some myths develop around it. While we’re flattered by the attention, we thought it might make sense to tackle them, just to clear the air,” the post says. The myths address some of the privacy concerns around Google Glass such as “Myth 2: Glass is always on and recording everything”, “Myth 5: Glass does facial recognition (and other dodgy things)”, “Myth 7: Glass is the perfect surveillance device” and “Myth 10: Glass marks the end of privacy”. Appster director Mark McDonald says privacy is a big issue for people and would continue to be. He notes that anti-surveillance software is becoming increasingly popular. McDonald says its Google’s unusual approach to distributing the Google Glass with its exclusive explorers project that seems to have backfired. “They pretty much limited it developer communities and they’re the ones who have now turned against it,” he said. That might explain “Myth 8: Glass is only for those privileged enough to afford it”, which says: “The current prototype costs $1500 and we realize that is out of the range of many people. But that doesn’t mean the people who have it are wealthy and entitled. In some cases, their work has paid for it. Others have raised money on Kickstarter and Indiegogo. And for some, it’s been a gift.” McDonald says some of the early prototypes were pretty underwhelming, when people were expecting something along the lines of 3D augmented reality. Despite that, he’s a huge fan, though he says he’s yet to wear his out much as people just think it’s geeky. “Even if Google Glass doesn’t become a product, the exciting thing is the potential for wearable technology,” McDonald says. In his own company, which develops Google Glass apps, McDonald says most of the current interest comes from enterprise, but Google Glass will become cool when the trend is driven by fashion. “Technology is becoming more and more commoditized and the challenge for Google is how to make Glass fashionable,” he says. Perhaps then the Google list is still missing Myth 11: Google Glass is not fashionable.
Crowdfunding platform Kickstarter has this week celebrated passing $US1 billion in pledges for projects around the world, with Australia the fourth largest country for the value of funds promised. The company says in an online post that Australia had 109,456 backers who pledged $US31,776,566. The US was the biggest country for pledges, with $US663,316,496 promised, followed by the United Kingdom with $US54,427,475, and then Canada on $US44,913,678. Kickstarter says it passed the $US1 billion milestone on March 3. Crowdfunding sites such as Kickstarter and Indiegogo have become sources of funding for many start-ups seeking to validate consumer interest in their products and get them into production. Melbourne Watch Company managing director Sujain Krishnan is currently running a Kickstarter campaign for his firm’s second timepiece and has already received pledges worth $20,237, smashing its $15,000 goal, with 48 days still to go in its campaign. “To start up a company, a watch company, it requires a lot of capital,” he told StartupSmart. “Crowdfunding is a good way to get exposure and reach beyond what I could normally.” A former IT project manager, Krishnan says the Kickstarter campaign for his Hawthorn-style watch is the second crowdfunding campaign he’s undertaken, having used rival platform Indiegogo for his first campaign for his first timepiece, the Flinders-style watch. The first campaign was also successful, breaking the $10,000 target by 277%. He says he was surprised at how successful the crowdfunding campaigns have been. “I wasn’t sure what to expect,” he says. Krishnan says it’s now a “pretty common practice” for start-ups to raise funds through crowdfunding platforms. He says he used to build watches as a hobby and sell them online and decided to make it his full-time job after building up a following among watch enthusiasts and realising there was a chance to turn it into “something bigger”. Kickstarter says Wednesday was the day of the week that saw the most money pledged while the 13th day of each month was also when most money was pledged. It says March 13, 2013 was the single day that saw the most pledges with 54,187 backers pledging $US4,029,585 to 1985 projects. The company says more than half of the $US1 billion pledged on Kickstarter was pledged in the past 12 months.
As crowdfunding continues to develop, so too does the information about how to run a successful campaign. With another platform, Indiegogo, launching in Australia this week, StartupSmart spoke to its Australian community consultant, Tony Been, who shared his top four tips for getting support beyond your immediate network. “The most important thing is to be smart about what you’re raising for. Don’t try to fund the whole project, break it into tangible pieces so you can hit the goal, and then keep re-engaging the same audience for each later goal,” Been says. Over 150,000 campaigns have been run on the platform since it launched in 2008. The site currently receives over nine million unique browsers a month. Been says the majority of projects take home cash, as people increasingly opt for more flexible campaigns compared to the traditional, all-or-nothing style crowdfunding range. He adds 70% of money donated in a campaign is “stranger money” from people outside the entrepreneur’s network, but it’s never the first 30%, so fundraisers need to plan campaigns carefully. Being proactive and updating regularly will boost your chances by over 200% Been says those embarking on a crowdfunding campaign need to give it their all, and not be too shy about encouraging momentum. “You need to be really proactive. Tell people about it constantly. We know people who update their campaign one to five times a week will raise 218% more than people who just let the campaign tick over. It’s about constantly engaging with the audience.” Being proactive can also catapult your campaign from your own networks to the Indiegogo home page, blog or social media channel. “We have an internal algorithm that kind of works like Google page rank. It’s about how active the campaign is, so every tweet, share, link in or out counts towards your chance to leap onto our front page,” Been says. Focus on the three levers to attract new donors People who get involved in campaigns run by people they don’t know do so for three reasons: perks, passion and participation. Been says campaigns that combine the three effectively are more likely to go viral. “If you can pair a perk or bonus to one of the more interesting elements of the project, you’re set,” Been says. “The key is to have a strong pitch, and the strongest is your own personal story and passion.” According to Been, the key to writing a compelling pitch is passion, but also about tapping the visionary potential within. “We often talk about engaging the ‘artist within’ with the people you’re trying to raise from. It’s about remembering how when we were all younger, we had huge unstoppable dreams. If you position your passion as part of that, you’ll wake up that part of your reader, and that’s really powerful,” Been says.