Henry Ford

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We need to put high-growth tech companies on the G20 agenda

11:49PM | Tuesday, 11 November

The world was a very different place in December 1999 when the first G20 met in Berlin. Steve Jobs had just taken back the reins at Apple, but Facebook, Google, Twitter and the dot-com bust were figments of imagination. When government and central banking leaders meet in Brisbane this week, they will have a very different set of concerns, as well as a different set of levers to achieve the goal of “stable and sustainable world growth that benefits all".   The path of least resistance is to make small adjustments in an effort to re-balance and re-ignite growth. Instead, they should be considering how to stimulate and harness the power of digital disruption to create companies that can grow fast and create jobs we can not even imagine.   The continued growth of the start-up culture and the “overnight” success of new businesses such as Uber, AirBnb and Dropbox demonstrate the economies of tomorrow are being shaped by companies which have became global players overnight. Rather than focusing on a few adjustments to re-stabilise the world’s economy, the G20 leaders need to understand the impact of digital disruptions on nations and industries. All will be impacted; none will be spared.   Deloitte Digital’s latest report, “Harnessing the bang”, identifies some of the impacts of this “digital disruption” to existing companies. It notes that 13 industries comprising 65% of the Australian economy are facing significant disruption by 2017. Google, for example, has revolutionised advertising, Amazon has re-invented the book publishing industry, streaming services like Netflix have changed the movie and entertainment sector, and internet banking has changed financial services.   It’s clear this is a worldwide phenomenon, not just one facing Australia. Digital disruption belongs on the G20 agenda.   Threat or opportunity?   As ancient Chinese wisdom says, every threat contains the seeds of opportunity. The democratisation of markets brought about by the rise of technology represents boundless opportunities for companies that are innovative.   Henry Ford heard people say they wanted to travel faster, but instead of breeding a faster horse, he used new technology to create a motorised vehicle – and a manufacturing industry no one had imagined. Automobiles disrupted traditional modes of transportation and required workers to have new manufacturing skills. New companies were born and new hard infrastructure required: roads, bridges.   The same is happening with digital technology. The digital products and services require new skills, will generate new companies and need a different kind of infrastructure to support them (broadband internet, global paths to market, venture funding etc.)   Australia has some great start-up success stories: Atlassian provides software to the software makers all over the world, and Canva is reaching 1,000,000 customers. Both are carving a global path to success in their particular industries.   The G20 Global Café in Brisbane will showcase several more companies that are digital disruptors of traditional industries, are already going global and have the potential to grow big.   Some are concerned that tech companies don’t create jobs – they underestimate the impact that tech start-ups have on wealth and job creation. The IPOs of Google, Facebook and Twitter together created nearly 4,000 millionaires.   As for job growth, high-tech companies create a disproportionate share of high-value jobs. Between 2002 and 2008, for example, 6% of UK businesses with the highest growth rates created 50% of the new jobs. Professor Enrico Moretti, an economics professor at UC Berkeley, notes that for every job a tech company creates, five new jobs are created in other sectors – a multiplier effect three times higher than for extractive or traditional manufacturing industries.   The focus should be start up, then grow up   So it’s pretty simple: entrepreneurs whose businesses use digital technology to develop or deliver products and services that customers need and want will grow the fastest, create the most jobs and have the highest probability of success. This in turn has numerous economic benefits for countries that encourage and foster an entrepreneurial mindset and a high-tech-friendly environment.   Smart governments that have already figured this out are beginning to provide resources and support their start-up ecosystems. From science, technology, engineering and maths (STEM) and entrepreneurial education, through to direct government funding at the venture capital stage, they are placing a premium on developing more high-growth technology companies, teaching CEOs how to start and grow companies, and removing the barriers to growth.   So what does Australia, in particular, need to do to create the environment in which our digital disruptors can quickly become high-growth, global players? It’s pretty simple:   Encourage more people to start companies and make jobs, not just take a job. Teach people the entrepreneurial mindset and support those who see opportunities and want to start and grow companies. Provide more funding for research and education, especially in science, technology, engineering and maths (STEM). Revamp systems that support the commercialisation of research with the goal of developing more technology companies. Support the development of an ecosystem that provides entrepreneurs with what they need to grow companies: access to knowledge, talent, money and space. Have a workforce ready and able to work in companies that make widespread use of technology. Help existing businesses adapt to the world of digital disruption.   The Australian government is beginning to understand that the future must include high-growth technology companies, as well as mining, gas and agriculture. It is beginning to engage with bodies such as StartupAUS (of which I am a board member). We are hopeful that the Department of Industry’s Entrepreneurs Infrastructure Program and additional programs will spur the development of more venture capital and more disruptive technology companies in Australia.   The G20 countries need to understand the power of digital disruption and develop economic and financial policies that actually capitalise on that disruption. Creative destruction of old industries is the norm; the internet is an accelerant to the pace of disruption. Innovation, digital disruption and entrepreneurship are not passing fads – they are the solution to the economic problems we are experiencing. Countries that understand this and develop polices and programs to support it will benefit the whole world.   This article originally appeared on The Conversation. Photo: Peter Dasilva/EPA/AAP   Follow StartupSmart on Facebook, Twitter, and LinkedIn.

Envato becomes the first Australian startup to release its diversity figures, encourages others to do the same

9:43AM | Thursday, 4 September

Envato has become the first Australian tech startup to release comprehensive workforce diversity figures.   Of the company’s overall workforce, 71% are male and 29% female, with a similar divide in leadership roles, 72% of which are occupied by men.   The contrast is even starker in tech roles, with 93% of roles occupied by men. Women are considerably better represented in non-tech roles at 42%.   Co-founder and chief executive officer Collis Ta’eed says the company is actively trying to improve its diversity, and hopes one day the company can look back on the figures and see how far they’ve come.   “They’re not figures we’re proud of, but it fits our value of transparency,” he says.   “It also shows potential applicants that this is something that we take seriously, acknowledge we could be better, and not pretending we have got it all figured out.”   “I have an especially strong belief that diversity leads to better outcomes, the more varied the opinions in the room, the more different backgrounds and experiences at the table, the more likely you’re going to get the best answer. I feel like it’s about getting a strong team.”     When Envato examined its job application statistics, it found that only 5% of applications came from women. Ta’eed says in light of that fact, the company is rethinking the way it approaches recruitment.   Like Google, LinkedIn and Twitter before it, Envato admits there’s a problem and hopes the release of its figures will form a solid basis for meaningful discussions about ways to address to gender imbalance in technology.   It’s the furthest any Australian tech startup has gone so far.   Freelancer releases a small snapshot of diversity in its annual report, while 99designs and Campaign Monitor maintain a level of transparency by including photos of each and every one of their employees on their websites.   “I think it’s a broader issue than Envato,” Ta’eed says.   “But at the end of the day all we can really work on is our own backyard. But I’d certainly encourage other companies to take a transparent approach. It helps the conversation by providing actual stats so it becomes more than anecdotal evidence.”   Envato has implemented a number of policies to try and address its diversity problem. Late last year it created a dedicated group that brought together men and women from across the company called The League of Extraordinary Inclusiveness, which is working on ways to make Envato a more inclusive workplace. It was created after some of Envato’s employees pointed out the diversity problem.   “We have a culture of reflection built in,” Ta’eed says.   “Henry Ford said ‘I always get a brain when all I wanted is a pair of hands’. We’re the opposite, we want a thinking human; someone who actively wants to improve their work environment.”   Some of Envato’s initiatives include improving flexibility for employees, supporting events encouraging women to enter technology, encouraging staff to mentor women in technology, and rethinking recruitment with a focus on inclusiveness rather than closed network.   “Our very first employee was a software developer, a man, the next two were people that he knew and that trend carried on,” Ta’eed says.   “We primarily relied on the existing staff’s own personal networks, for better or worse, if they happened to know lots of women, it might have been a different story.   “So we’re choosing to cast our net further and deliberately go to places where female tech developers and software programmers go. We recruit top talent, we always go to where the top talent is, so we thought if female tech talent is not coming here, let’s go to where they are.”   Follow StartupSmart on Facebook, Twitter, and LinkedIn.

Can Google convince us that an oversized golf cart is the car of the future?

6:23AM | Tuesday, 3 June

Google have recently shown us a car of sorts. The self-driving Google Car is the internet giant’s latest foray into physical products.   Visually it’s a cute cross between a golf cart and a Japanese anime character, with an obvious ‘face’ and round, soft features that exude friendliness and care. However, ideologically the driverless vehicle is more akin to an escalator than a car.   Interestingly, in developing a car that doesn’t need a driver, Google are venturing into completely virgin territory and as a result they have exaggerated the friendliness of the product to make it appealing to the public. The Google Car’s cuddly aesthetic is designed deliberately as a counterpoint to the abject fear most people would have in handing over control of their car to a computer.   The Google Car does contain amazing technology, even at a prototype level. The autonomous, self-learning vehicle has sensors that can remove blind spots by detecting multiple distinct objects simultaneously in all directions for hundreds of metres and hopefully react safely. Sound impossible? So did the iPod before Steve Jobs and Jony Ive put their minds to it.   Watching the publicity video clearly illustrates Google’s ideas on the target demographic, with older people, the blind and children the focus. At least initially, they seem to see the car as a device for people who can’t drive or don’t want to. Unsurprisingly, everyone appears to be having a ridiculous amount of fun.   Like all designers of products that create a paradigm shift, Google’s team needs to answer questions that others haven’t tackled before. Who would use it, how and why? Can current technology deliver a suitable solution? How much actual driver control should be relinquished? In discussing the Google Car in our studio, debate raged about what would happen in a crowded street. How would the Google Car react to a random mistake by another driver or pedestrian? These are the unknowns that still need to be worked through.   Therein lies the most important aspect of this project. The Google Car is a big innovation, but it really is only the first foray into the unknown. This prototype will challenge what we think and allow people to test the technology in the semi-real world. No doubt it will fail some tests, but it’s sure to provide insights that we don’t expect, and lead to innovations that most can’t imagine right now.   Like Apple and Nike before them, Google is applying their massive resources to looking outside their comfort zone for bigger opportunities. In doing so, they are risking failure and ridicule (look no further than the backlash against Google Glass), but they also open the opportunity for enormous rewards as the first into a new market.   Perhaps the biggest hurdle to acceptance of the Google Car may not be confidence in the technology, but people’s love affair with the glamour of a fast car. The ability to be reckless, to feel the power of the engine or to show off to your peers may still be that intangible desire that an oversized golf cart could never deliver.   Although many will scoff at the idea of a self-driving car, pointing to countless issues and dangers with the concept, the fact is that it seems almost inevitable in some form or other. If we look to science fiction we could expect these types of vehicles to be very much part of our lives sooner than we imagine.   In the words of the great Henry Ford, “If I’d asked people what they wanted, they would’ve said a faster horse.” Perhaps the Google Car represents the first small step towards one of the biggest changes to our society since the internet was invented.   Nathan Pollock is director at Katapult Design Pty Ltd.

How much should I tell investors about my idea?

3:16AM | Thursday, 14 March

How do you tell potential investors about your idea without spilling every little detail and giving away the whole plan?

How Twitter is evolving into a must-have tool for start-ups

2:09PM | Sunday, 3 February

Is Twitter moving from a niche player to a mainstream business tool? There have been several clues to its evolution in recent months, from its launch of an Australian office to its attempt to lure business users with $1 million in free advertising credits.

April’s top business book

4:21AM | Sunday, 29 April

Iconoclast, by Gregory Berns (Harvard Business Press, 2010, 250pp, RRP$29.99)   According to author Gregory Berns, an iconoclast is a person who does something that others say can’t be done.

Can Twitter help grow your business?

4:36AM | Friday, 27 April

The value of Twitter, in both monetary and customer number terms, has recently become a little clearer – $10 billion and 175 million are the key numbers, respectively.

Top ranked brands’ lessons for start-ups

12:08AM | Monday, 6 December

Start-ups have been advised to heed the lessons of the world’s leading companies following a report that placed Coca-Cola as the leading global brand for the eleventh year in a row.

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