Appster, one of Australia’s fastest growing web and app development companies, has appointed two new strategic advisers to the business, former chief commercial officer at Virgin Australia, Liz Savage, and former CFO for PayPal, David Jaques. Founded two years ago, Appster now has offices in Australia, India and the USA. David Jaques has been instrumental in the financial success of several leading global organisations, including PayPal and BlueRun Ventures (Nokia’s venture capital fund). Currently the CFO at Greenough Consulting Group and former CFO at 500 Startups, Jaques launched his career with Barclays Bank PLC working in both London and New York until taking on the position of senior vice president at Silicon Valley Bank. During his time at PayPal, Jaques was instrumental in raising private equity finance totalling $140 million and coordinated the merger of PayPal Inc. and X.com Corporation, resulting in a $680 million valuation. Under Jaques’ management as CFO, BlueRun Ventures’ assets increased from $150 million to $1 billion in six years. Appster cofounder and managing director Mark McDonald says Jaques is an “institution” of the startup world. “He has provided financial advice to some of the world’s leading organisations and I am thrilled he has agreed to join the Appster team as an adviser,” McDonald says. Liz Savage, who joined as an adviser in May this year, has extensive experience in building and growing brands and businesses globally. Savage was fundamental in building easyJet in its first 10 years from startup to Europe’s leading airline, which now operates across more than 30 countries and last year flew over 60 million customers. Savage then joined Monarch Travel Group as managing director of its Flights & Holidays business, before being headhunted by Virgin Blue to the position of chief commercial officer in Australia, tasked with transforming the airline from low cost to premium, as well as launching and building the new brand of Virgin Australia. Savage held accountability for the group’s $4 billion global revenue and customer-facing functions including sales, marketing, pricing, loyalty, contact centres and the group’s digital and holiday businesses. McDonald says Appster’s future is looking very bright under the guidance of the two new appointments “The whole team at Appster is honoured to be working with Liz and David and we look forward to taking Appster to the next level,” McDonald says. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Embattled Qantas chief executive Alan Joyce is set to begin talks with union heavyweights today after announcing 5000 job cuts and a wage freeze, following a massive $252 million loss for the December half. “The current position is unsustainable. There are many Australian companies that have failed because they were not prepared to make the hard decisions. Qantas is not one of them,” Joyce says. Meanwhile, Prime Minister Tony Abbott has poured cold water on the idea of a federal government debt guarantee for the troubled airline. “Why should the government do for one what it is not prepared to do for all, or what is not necessarily available for all?” Abbott says. Air New Zealand posts record profit Air New Zealand has posted a record half-year profit of $NZ140 million ($A130 million) despite expectations of a $49 million loss at Virgin Australia, in which it holds a 24.5% stake. “We have worked hard on improving our cost base in an environment where we have not grown,” Air New Zealand chief executive Christopher Luxon says. “In fact, we have reduced our capacity flown overall as we realigned our long-haul network.” Nationals MP raises doubts over paid parental leave New South Wales National Party Senator John Williams has raised doubts over the future of Prime Minister Tony Abbott’s proposed paid parental leave scheme, telling the ABC the economy is too weak to support the plan. “I've said all along, I don't have a problem with the paid parental leave scheme. That is our policy so long as the economy is strong, but I do have concerns about the strength of the Australian economy,” Williams says. “To me a strong economy in Australia [has] a four in front of unemployment – that's currently got a six in front of it and a four or close to four in front of economic growth - and we're currently growing at 2.5%.” Williams says he will have talks with Abbott before announcing whether he’s willing to cross the floor over the proposal. Overnight The Dow Jones Industrial Average is up to 16248. The Aussie dollar is down to US89.6 cents.
Mining tycoon Andrew “Twiggy” Forrest has publicly backed a controversial decision by Treasurer Joe Hockey to block the takeover of GrainCorp by US agribusiness giant Archer Daniels Midland. In a speech to the Australia-China Senior Business Leaders' Forum, Forrest pointed out that of 130 foreign takeover bids reviewed since the September election, the GrainCorp takeover was the only proposal rejected. “In the case of GrainCorp, the decision was necessary given the concentration of power in a near monopoly situation. “The upshot is whenever you have got such concentration of market power there, consideration needs to be given to more than one set of stakeholders, the shareholders.” ANZ hit with massive class action over bank fees ANZ has been hit with the largest consumer class action in Australian history, with law firm Maurice Blackburn taking action over excessive bank fees. Andrew Watson, the head of class actions at Maurice Blackburn, says the bank’s fees don’t accurately reflect the costs of minor transgressions. “The fees range, but $25 to $35 is the sort of range for fees that are imposed, so you might be a dollar over on your account or a day late in your payment and the banks will slug you with a fee that's out of all proportion to what it costs them for that minor transgression," he said. "We think it's worth [in total] about $50 million, but overall we're running a case for 170,000 bank customers against eight major banks, and that's worth about $220 million." Virgin attacks federal help for Qantas Virgin chief executive John Borghetti has called for Virgin Australia to receive the same support from the federal government as its arch-rival, with Treasurer Hockey refusing to rule out using public funds to prop up Qantas. “There have been media reports that the government offered comfort letters to Qantas’s credit rating agencies, prior to our capital raising,” Borghetti says. “I would also note that if Virgin Australia had been afforded the benefit of such a letter, it would have enabled us to achieve superior outcomes from both the recent debt bond issue undertaken in the US market and the capital raising that is underway.” Overnight The Dow Jones Industrial Average is down to 5314.3. The Aussie dollar is up to US91.36 cents.
Billabong has struck a deal worth $395 million in total with US private equity firms Altamont and Blackstone, with Launa Inman set to be replaced by former Oakley chairman Scott Olivet. The complicated deal will see Altamont and Blackstone group lend $325 million as part of a bridging loan and five-year debt facility, with Altamont paying an additional $70 million for adventure sports brand Dakine. The deal will see Billabong repay its $289 million syndicated debt facility in full and gain an additional $106 million in working capital. In return, Billabong will pay Altamont 12% interest on the loan along with 42 million share options, which if exercised will see the private equity firm own between 36.3% and 40.5% of the surfwear company. Etihad increases stake in Virgin Australia Etihad Airways chief executive James Hogan has revealed his airline has been buying shares in Virgin Australia, after receiving permission from the Foreign Investment Review Board to lift its stake from 10% to 19.9%. Aside from the 13% stake held by Richard Branson’s Virgin Group, other key shareholders include Air New Zealand at 23% and Singapore Airlines at 19.9%. “We fully support [Virgin Australia chief executive] John Borghetti and his management. We have a great relationship with Air New Zealand and we have an amicable relationship with Singapore. While we don't code-share on passenger routes, we code-share on cargo. This is about our options and we continue to work through that,” Hogan says. ASIC forces Commonwealth Bank and HSBC to change “potentially misleading” ads The Australian Securities and Investments Commission has forced the Commonwealth Bank and HSBC Australia to change “potentially misleading” advertising presenting complex protected loan and structured financial products as being simpler and less risky than they actually are. “HSBC claimed that its structured products were suitable for 'traditional deposit investors looking for a way to enhance their returns through exposure to financial markets, but are unwilling to put their capital at risk should the market not perform as expected',” ASIC says. “[But] this statement was inappropriate and potentially misleading due to the risk of capital loss with certain [of the] HSBC structured products being promoted.” Overnight The Dow Jones Industrial Average is down .21% to 15451.85. The Aussie dollar is down to US92.43 cents.
In Australia, we live in what I call a ‘high trust’ society. We tend to take people at their word. For example, imagine you are at a social gathering where you do not know anyone. Someone asks you “What do you do for a living?” You could say, “I am an airline pilot with Virgin Australia” and most people will accept what you say immediately. In fact, you could make almost anything up! This model will, of course, fail immediately if the person you are talking with says, “I am too, which route do you fly?” or if they know someone in the room who is also a pilot. The lesson here is, in Australia and many Western countries, people tend to trust first and ask questions later. In most of the rest of world, however, business is transacted in a low trust environment where trust must first be earned, sometimes with every call you make. We work with those we trust to solve our problems If I want someone to make a buying decision with me, I need them to trust that what I say will happen when they buy my product or service. The bigger the decision, the larger the level of trust required. Trust comes in three stages: Stage one: This is a good person I was talking with an older person just listening to their stories. After a while, out of the blue, she said, “Greg, you are a good boy.” I was so surprised, I said, “Why don’t you put that in writing”, which she did. I now have a signed piece of paper, which I treasure, stating: “Greg is a good boy.” Getting to the point where someone thinks you are a good person is just a matter of listening while asking open, reflecting and probing questions. The fact you take the time to listen tells the other person you are someone they can trust. Stage two: This person has good ideas A fellow business coach asked for a minute of time to discuss a client of theirs they were having trouble with. At the end of this discussion, she said: “Greg, you always have great ideas. Do you mind if I use you on an ongoing basis?” All I had done was listen to the problem and reflected ideas back in the same format as she stated them. For example, she said: “The person I am coaching has achieved all the goals we set out to achieve. I do not know where to go from here.” “Have you reset the goals in light of the way the person has developed?” I asked. What I did was reflect back her words in a new way. While this was not rocket science, it did give her an ‘a-ha moment’ and cemented in her mind that I have good ideas and moved me to the next level of trust. Stage three: This person can do what they say they can do “You can change all that COBOL into JAVA using an automated tool?” one incredulous programmer asked me. I could see this multimillion dollar project was going nowhere despite the level of trust we had developed. I asked: “John, if I can show you this working will you authorise a pilot program?” What John wanted was evidence for himself and others of his team that I was a trustworthy person. We set up the demonstration and won the pilot program. They believed because we showed we could do what we promised on a small scale, then a large scale. Your trust bank account When you meet someone for the first time you automatically open a ‘trust bank account’ with a small, but positive, balance. Every time you promise to deliver a result (to get more, to save more, to look good, to feel good, to eliminate pain, or to be loved) and you do it, you add to your trust bank account. Every time you fail you make a withdrawal. Can you be trusted before you can prove it? Yes, in most situations people will take you at face value. When it comes to decision that will impact their business or life you can be sure it will only be made when you trust bank balance is substantial. Today’s question and actions: This week, when you meet with your clients ask this simple question: “How could purchasing this product or service change the way you do business?” You may be surprised by the answer. What are you doing to make deposits into your trust bank account? Every time you make a promise, no matter how small, if you do not deliver it counts as a withdrawal. Send an unexpected handwritten card or thank-you note and you add to your trust account. Do you listen attentively? Do you share ideas? Nothing will establish trust and increase sales better than becoming an expert in asking the right questions, following up with ideas and showing how these ideas work with other organisations. Email me to set up a time to talk about opening a trust account with your team. Have a great week! Reprint permission: Permission is granted to reprint this article with the condition it is republished unedited and in full with full attribution to the author and the authors bio. Please provide a link to the reprint to the following email; [email protected]
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