{"id":35509,"date":"2023-10-20T14:39:01","date_gmt":"2023-10-20T14:39:01","guid":{"rendered":"http:\/\/startupsmart.test\/2023\/10\/20\/the-one-thing-governments-should-do-to-help-startups-and-other-words-of-wisdom-from-an-aussie-vc-in-silicon-valley-startupsmart\/"},"modified":"2023-10-20T14:39:01","modified_gmt":"2023-10-20T14:39:01","slug":"the-one-thing-governments-should-do-to-help-startups-and-other-words-of-wisdom-from-an-aussie-vc-in-silicon-valley-startupsmart","status":"publish","type":"post","link":"https:\/\/www.startupsmart.com.au\/uncategorized\/the-one-thing-governments-should-do-to-help-startups-and-other-words-of-wisdom-from-an-aussie-vc-in-silicon-valley-startupsmart\/","title":{"rendered":"The one thing governments should do to help startups and other words of wisdom from an Aussie VC in Silicon Valley – StartupSmart"},"content":{"rendered":"
There\u2019s only one thing that governments should be doing to help drive innovation and assist the growth of startups, Zetta Venture Partners<\/a> general partner Ash Fontana says.<\/p>\n <\/p>\n In an AMA run by Blackbird VC<\/a>, Fontana – an Australian venture capitalist who helped launch the fundraising business at AngelList – says governments should focus on something simpler than trying to change culture: \u201cspending money\u201d.<\/p>\n <\/p>\n \u201cThat\u2019s it. If you ignore the hagiography about cultural visions and brilliant curricula, you will see that startup hubs like Silicon Valley were spurred by massive government spending,\u201d Fontana says.<\/p>\n <\/p>\n \u201cIdeally the government would spend money on areas in which the country already has a competitive advantage.\u201d<\/p>\n <\/p>\n This doesn\u2019t mean the government has to spend extra money either, Fontana says, but rather to reinvest it in more important areas.<\/p>\n <\/p>\n \u201cI\u2019m not arguing for the government to have more money to spend, just that if it does have money and wants to spur innovation then it should spend that money rather than use its power for other things that will get in the way of growth rather than fuel it,\u201d he says.<\/p>\n <\/p>\n Fontana has been working as a VC in Silicon Valley for more than seven years now, and shared a number of useful pieces of advice and wisdom during the Q&A session.<\/p>\n <\/p>\n \u00a0<\/strong><\/p>\n Fontana has a \u201cvery long list\u201d of things to check off before investing in a startup \u201cfor the long run\u201d, including:<\/p>\n <\/p>\n \u00a0<\/strong><\/p>\n For an Australian startup to successfully secure funding in Silicon Valley, the team needs to get feet on the ground for a long period of time, he says.<\/p>\n <\/p>\n \u201cThe first step is to be in the Valley for at least three months,\u201d Fontana says.<\/p>\n <\/p>\n \u201cOne generally cannot meet enough people or hold enough meetings to form a great partnership with an investor or investors in less than three months. Once you\u2019re here, all the usual advice applies.\u201d<\/p>\n <\/p>\n \u00a0<\/strong><\/p>\n While there are a number of things that founders should be looking out for, giving away equity in exchange for an advisor could be beneficial in the long run, Fontana says.<\/p>\n <\/p>\n \u201cYoung companies should give up equity if they can clearly articulate the value they will receive from it and accordingly set expectations with the potential advisor,\u201d he says.<\/p>\n <\/p>\n \u201cLook out for advisors that won\u2019t invest their own money in the company, aren\u2019t willing to commit to some sort of milestone of hours or months and don\u2019t provide any value before committing.<\/p>\n <\/p>\n \u201cThere is often a very strong reason to give advisory shares. Valuable people value their time and smart people will appreciate that value.<\/p>\n <\/p>\n \u201cGiving shares to a few key advisors with direct industry experience and great connections usually works out to be more valuable and cheap, in aggregate, than giving 7-10% to an incubator for $100,000.\u201d<\/p>\n <\/p>\n \u00a0<\/strong><\/p>\n According to Fontana, the current Australia startup ecosystem is virtually unrecognisable from just five years ago.<\/p>\n <\/p>\n \u201cThere are now great firms funding companies from angel to incubator to seed to Series A,\u201d he says.<\/p>\n <\/p>\n \u201cThese firms have the cash, management, competence and capital allocation ability to grow world-class companies. There was perhaps one such firm five years ago.\u201d<\/p>\n \u00a0<\/strong><\/p>\n Startup founders need to be able to articulate their product-market fit and know their potential customer base intimately, he says.<\/p>\n <\/p>\n \u201cI think that a founder should be able to explain a problem of commercial consequence in great detail \u2013 they should be able to paint a very detailed picture of their potential customer,\u201d Fontana says.<\/p>\n <\/p>\n \u201cThey should be able to do this far better than almost anyone on the planet to be able to form a strategy that will yield a competitive advantage.<\/p>\n <\/p>\n \u201cYou don\u2019t need experience in an industry to understand a problem. Often, understanding a problem by asking the right questions is harder if you start with a bunch of related assumptions generated through personal experience.\u201d<\/p>\n Follow StartupSmart on Facebook<\/a>, Twitter<\/a>, LinkedIn<\/a> and SoundCloud<\/a>.<\/em><\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" There\u2019s only one thing that governments should be doing to help drive innovation and assist the growth of startups, Zetta<\/p>\n","protected":false},"author":2,"featured_media":62207,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts\/35509"}],"collection":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/comments?post=35509"}],"version-history":[{"count":0,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts\/35509\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/media\/62207"}],"wp:attachment":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/media?parent=35509"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/categories?post=35509"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/tags?post=35509"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}What he looks for in a startup<\/strong><\/h3>\n
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How an Aussie startup can close a funding round in Silicon Valley<\/strong><\/h3>\n
Why it can help to give away equity<\/strong><\/h3>\n
The growth of the Australian ecosystem<\/strong><\/h3>\n
<\/h3>\n
What a founder needs to know<\/strong><\/h3>\n