First-place Peter Farrell Cup Competition winner TaxiApps has won again, this time at the John Heine Entrepreneurial Challenge at the University of Adelaide (in partnership with Queensland University of Technology) on 9 & 10 December 2010. Taxi Apps is a mobile phone-based taxi booking and fare payment platform.
Team TaxiApps not only won First Runner-Up, which comes with over $7,000 in cash and prizes, but also the Outstanding Showcase Display Award, and the i.lab technology incubator Award.
Team member Andrew Campbell says, "[We] embarked on this journey because we perceived it would be a great process to go through to refine the business plan. And you know what? It has been remarkable as a way of doing this. The prize money was perceived as a bonus...If we had just tried to write a plan and a model ourselves, I can imagine how crap it would be.
"By going through the PF Cup and the JH Challenge we have received so much in-put, energy, critique and motivation. The TaxiApp plan is now really well refined and we believe that it now has a much greater chance of success as a business. In addition, we now also have some great contacts, we learned lots, we pitched and pitched and pitched this thing & we know it backwards."
TaxiApps has developed a mobile phone-based taxi booking and payments platform. One of the application's main features is to connect passengers and taxi drivers directly by broadcasting their location using mobile phone technology: passengers save time and effort finding cabs, while drivers get more fares and revenues.
In Australia, large taxi network operators and the highly monopolistic payments firm, Cabcharge, wield enormous influence and control over other players in the industry. The Taxi Apps business is founded on the principal of applying emerging technology to disrupt a highly monopolised market, redefining in the process how this market operates.
For more information on the John Heine Entrepreneurial Challenge, click through on the following link: http://www.johnheinechallenge.org/competitor/prizes.jsp
Blog for the Centre for Innovation and Entrepreneurship (CIE) at the Australian School of Business (ASB) at the University of New South Wales (UNSW). The CIE inspires innovation and entrepreneurship through its educational programs, competitions, events, and research initiatives.
Tuesday, December 21, 2010
Friday, November 26, 2010
Peter Farrell Cup competition RESULTS!!
Mobile phone-based taxi booking and payments platform developer TaxiApps took first place in the 10th annual Peter Farrell Cup Business Plan Competition last Thursday. The event was hosted by the Centre of Innovation & Entrepreneurship (CIE) in the School of Strategy & Entrepreneurship at the Australian School of Business (ASB).
The competition offers teams of students the opportunity to create and develop an innovative business idea, then present it to a panel of five judges comprising business founders and venture capitalists.
“The whole process, from coming up with idea and then thinking through what we wanted to do and how we were going to do it – the whole thing just gathered momentum and then I started thinking `Hey, we could really do this’ and now it’s just really exciting that we’re going ahead with this,” said TaxiApps team member Ned Moorfield, a student of the AGSM. “The contest really gets you going.”
Other winning ideas were: on-site toxic halogenated waste recycling, hangover and osteoporosis medications, and an online social network for casual workplaces.
“I was really impressed at the sophistication of not only the presentations but the ideas themselves,” commented Axelle Marjolin, UNSW student and spectator, at the evening’s events. “I certainly wasn’t expecting so many technical ideas with that much development behind them.”
Judge Gareth Dando, founding Managing Director of Southern Cross Venture Partners, also expressed surprise at the ideas presented, saying, “I’m quite impressed with the calibre of the ideas and businesses [the teams] put together. There are some quite good ideas here, and not just for students.”
Teams were judged not only on their written business plan – which determined, from the initial 25 applicants, who would go on to win one of the ten spots in the finals presentation roster – but also on live presentation and their ability to field questions from a tough judging panel.
“The Peter Farrell Cup is about articulating a business idea, and doing that through a brief written plan and verbal pitch. It provides an opportunity to experience what it’s like to actually have an idea, develop a business model around it, and then solicit interest and feedback about the opportunity from real investors - people who know what they’re talking about and evaluate such opportunities on a professional basis,” said Dr Martin Bliemel, CIE’s Director.
“Sure, the judges are looking for a unique selling proposition, a clear market and risk analysis, and investment attractiveness, but what else they really want to see is that spark in the eye of the person telling them about it, they want to see that passion for the idea,” he explained.
Dr Peter C Farrell, AM, Founder and Executive Chairman of ResMed Inc, sponsor of the competition, was on-hand to announce the winners and present awards.
Ernst & Young and TiE also sponsored the event by offering full membership with the TiE and attendance at Ernst & Young’s Entrepreneur Of The Year ™ awards dinner to the winners.
A special addition to this year’s competition was the unveiling of the new Peter Farrell Cup competition trophy. Jointly designed by Selena Griffith, Lecturer at UNSW’s College of Fine Arts (COFA), Dr Miles Park, Senior Lecturer in UNSW’s Faculty of the Built Environment (FBE), and Industrial Designer Hugh Worthington (BSc. Design UNSW) of Vert Design in Redfern, the uniquely stylized cup is representative of the “crucible” effect of the competition on rough business ideas that are distilled and concentrated through participation in such competitions.
Made from recycled aluminium bicycle tire rims, the outside of the hollowed half-sphere has a roughly mottled surface created by a process called lost-foam casting. As the surface turns the edge from the outside, the level of polish increases until it reaches the centre of the hollow, which is almost a mirror.
“We wanted it to represent the ideas [in the competition] needing to be polished, and be something of value to hold. The polished texture changes the form, and it looks different and feels lighter as the texture changes,” said Andrew Simpson, Principal Industrial Designer at Vert.
First, second, and third place winners each receive a smaller replica of the Cup engraved with their team name to take home. The original Cup will remain on display at the CIE with the first-place team’s name engraved on the highly polished steel plate on which the trophy rests.
“Although it’s a long evening with ten 15-minute presentations, the level of activity and networking at the event was tremendous,” stated Dr Bliemel.
“One participant, Sampath from Solbij, which is a provider of solar chargers for mobile devices, did not make the finals but still came to the event and guerrilla-pitched the judges in their break to demonstrate the massive progress he made since his initial submission. Now that’s taking initiative and being entrepreneurial!” said Dr Bliemel with a laugh.
In addition to the prizes initially offered, the winning teams have also been invited to pitch to more investors at Seed Accelerator’s upcoming Sydney Startup Networking event on 9 December. TaxiApps is also going on to compete in the John Heine Entrepreneurial Challenge in Adelaide, and Solbij has received further advice from one of the founders of Sydney Angels.
Winners were:
1st place - TaxiApps (mobile phone based taxi booking and fare payment platform)
2nd place - ACIRO (on-site toxic halogenated waste recycling)
3rd place - OsteoPlus (osteoporosis medication)
4th place - Resaca de Borrachera (hangover cure at the molecular level)
5th place - Shiftr (online social network for casual workplaces)
For more information please contact the CIE at +61 2 9385 9730.
The competition offers teams of students the opportunity to create and develop an innovative business idea, then present it to a panel of five judges comprising business founders and venture capitalists.
“The whole process, from coming up with idea and then thinking through what we wanted to do and how we were going to do it – the whole thing just gathered momentum and then I started thinking `Hey, we could really do this’ and now it’s just really exciting that we’re going ahead with this,” said TaxiApps team member Ned Moorfield, a student of the AGSM. “The contest really gets you going.”
 |
| Dr Peter C Farrell with 1st place winning team, TaxiApps. From L to R: Trung Nghi Tiet, Ned Moorfield, Dr Farrell and Andrew Campbell |
“I was really impressed at the sophistication of not only the presentations but the ideas themselves,” commented Axelle Marjolin, UNSW student and spectator, at the evening’s events. “I certainly wasn’t expecting so many technical ideas with that much development behind them.”
Judge Gareth Dando, founding Managing Director of Southern Cross Venture Partners, also expressed surprise at the ideas presented, saying, “I’m quite impressed with the calibre of the ideas and businesses [the teams] put together. There are some quite good ideas here, and not just for students.”
Teams were judged not only on their written business plan – which determined, from the initial 25 applicants, who would go on to win one of the ten spots in the finals presentation roster – but also on live presentation and their ability to field questions from a tough judging panel.
“The Peter Farrell Cup is about articulating a business idea, and doing that through a brief written plan and verbal pitch. It provides an opportunity to experience what it’s like to actually have an idea, develop a business model around it, and then solicit interest and feedback about the opportunity from real investors - people who know what they’re talking about and evaluate such opportunities on a professional basis,” said Dr Martin Bliemel, CIE’s Director.
“Sure, the judges are looking for a unique selling proposition, a clear market and risk analysis, and investment attractiveness, but what else they really want to see is that spark in the eye of the person telling them about it, they want to see that passion for the idea,” he explained.
Dr Peter C Farrell, AM, Founder and Executive Chairman of ResMed Inc, sponsor of the competition, was on-hand to announce the winners and present awards.
Ernst & Young and TiE also sponsored the event by offering full membership with the TiE and attendance at Ernst & Young’s Entrepreneur Of The Year ™ awards dinner to the winners.
A special addition to this year’s competition was the unveiling of the new Peter Farrell Cup competition trophy. Jointly designed by Selena Griffith, Lecturer at UNSW’s College of Fine Arts (COFA), Dr Miles Park, Senior Lecturer in UNSW’s Faculty of the Built Environment (FBE), and Industrial Designer Hugh Worthington (BSc. Design UNSW) of Vert Design in Redfern, the uniquely stylized cup is representative of the “crucible” effect of the competition on rough business ideas that are distilled and concentrated through participation in such competitions.
 |
| New Peter Farrell Cup trophies by UNSW's COFA and FBE, and Vert Design |
Made from recycled aluminium bicycle tire rims, the outside of the hollowed half-sphere has a roughly mottled surface created by a process called lost-foam casting. As the surface turns the edge from the outside, the level of polish increases until it reaches the centre of the hollow, which is almost a mirror.
“We wanted it to represent the ideas [in the competition] needing to be polished, and be something of value to hold. The polished texture changes the form, and it looks different and feels lighter as the texture changes,” said Andrew Simpson, Principal Industrial Designer at Vert.
First, second, and third place winners each receive a smaller replica of the Cup engraved with their team name to take home. The original Cup will remain on display at the CIE with the first-place team’s name engraved on the highly polished steel plate on which the trophy rests.
“Although it’s a long evening with ten 15-minute presentations, the level of activity and networking at the event was tremendous,” stated Dr Bliemel.
“One participant, Sampath from Solbij, which is a provider of solar chargers for mobile devices, did not make the finals but still came to the event and guerrilla-pitched the judges in their break to demonstrate the massive progress he made since his initial submission. Now that’s taking initiative and being entrepreneurial!” said Dr Bliemel with a laugh.
In addition to the prizes initially offered, the winning teams have also been invited to pitch to more investors at Seed Accelerator’s upcoming Sydney Startup Networking event on 9 December. TaxiApps is also going on to compete in the John Heine Entrepreneurial Challenge in Adelaide, and Solbij has received further advice from one of the founders of Sydney Angels.
Winners were:
1st place - TaxiApps (mobile phone based taxi booking and fare payment platform)
2nd place - ACIRO (on-site toxic halogenated waste recycling)
3rd place - OsteoPlus (osteoporosis medication)
4th place - Resaca de Borrachera (hangover cure at the molecular level)
5th place - Shiftr (online social network for casual workplaces)
 |
| Winning teams of the 10th annual Peter Farrell Cup Entrepreneurship Competition |
Thursday, November 11, 2010
Peter Farrell Cup Competition FINALISTS
Congratulations to everyoone who submitted a business plan for this year's Peter Farrell Cup Business Plan Competition. The judges had a hard time narrowing the field down to just 10 finalists, and they are (with a VERY brief description):
ACIRO - on-site toxic halogenated waste recycling
Extron - hand-held electrical testing device
Nommm - food-photo-based social network
Osteoplus - osteoporosis medication
Rentech Coatings - medical device coatings
Resaca de Borrachera - hangover cure at the molecular level
Shiftr - online social network for casual workplaces
Shwanki - product wiki and trending website
TaxiApps - mobile phone based taxi booking and fare payment platform
Vogelco - infant heart-rate monitor
We're looking forward to seeing the presentations next Thursday, 18 November!
Friday, October 15, 2010
Meet the Entrepreneur - CleanTech - AFTERWORD
Given the rapid development of new technologies and regulations in clean technology, our panellists cited the following issues:
• The question of balance - do you hold out for perfection or make a prototype that's "good enough"?
• The problem of standardization - many emerging proto-standards can stretch resources too thin.
Join us for our next Meet The Entrepreneur, to take place in the early part of next year. The theme will be Open Innovation.
 |
| Dr Marc Newson, Ernst & Young |
Expertly moderated by Ernst & Young's Dr Marc Newson, the CIE's spring Meet the Entrepreneur event explored three innovative businesses in the rapidly-growing field of clean technology.
The panellists:
Guy Pross - Director, Business Development and Commercial Partnerships, Better Place Australia
Stone Wang - Managing Director, Artemis Building Systems
Matthew Warnken - Managing Director, Crucible Carbon
Guided by the themes of Economics, Scalability, and Convenience, the panel related some insights gained from their experiences in starting and building three very different businesses:
Better Place Australia is a global company dedicated to zero emissions driving through the delivery of services to enable confident adoption and use of electric vehicles (EVs). Better Place Australia will build and operate the infrastructure and systems to optimise energy access and use. By providing the infrastructure and services that make it easy, affordable and attractive for motorists to adopt and drive electric vehicles, Better Place will enable the mass adoption of EVs in Australia. (http://australia.betterplace.com/)
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| Guy Pross, Better Place Australia |
Artemis Building Systems pty ltd (ABS) is a Building Integrated Photovoltaic (BIPV) specialist with design, supply and engineering capabilities in Australia and China. ABS provides innovative and responsible supply solutions for building-envelope sustainability such as integrated curtain wall and overhead glazing systems with conventional and high performance glass and claddings or can provide Building Integrated Photovoltaic (BPV) systems to suit particular design requirements. (http://www.artemisbs.com/)
Crucible Carbon's pyrolysis process is designed to produce biochar, biocrude oils and pyrolysis gas from a variety of biomass sources at low capital cost and high energy efficiency - the goal being to have technology that is scalable, replicable and financially viable in today's economic conditions. Pyrolysis has significant potential to reduce greenhouse gas emissions at a global 'wedge' level of carbon abatement through the production and land application of biochar, in addition to generating renewable energy. (http://www.cruciblecarbon.com/)
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| Matthew Warnken, Crucible Carbon |
 |
| Stone Wang, Artemis Building Systems |
So, what did the panellists have to say about Economics, Scalability, and convenience?
- Australia is an excellent test market. It's our backyard and a convenient place to demonstrate proof of concept if you're looking to scale up for the US.
- While it is generally inconvenient to be the first to try unproven technology, no one wants to be the last person with obsolete technology (i.e. a petrol-powered vehicle in an EV world).
- Sure the early adopters will pay to be green, but ultimately the rest of the market wants and needs to know how their lives will be impacted - will they retain, or regain, more time and money for food, housing, medicine, education, family?
- Where is the value? What's the IRR to the investor? What are the government money factors (corporate taxes and employment income that offset subsidies, tax breaks and grants)? These have to be clearly defined - and credible!
- If you're depending on subsidies, this can get tricky as companies scale up by expanding to other regions. These days it's not enough to think less than globally.
And what's keeping the panellists up at night?
Given the rapid development of new technologies and regulations in clean technology, our panellists cited the following issues:
• The question of balance - do you hold out for perfection or make a prototype that's "good enough"?
• The problem of standardization - many emerging proto-standards can stretch resources too thin.
Join us for our next Meet The Entrepreneur, to take place in the early part of next year. The theme will be Open Innovation.
Thursday, October 14, 2010
StartMate Applications now open (closing at the end of November)
The twitter-sphere has been lit up with announcements from StartMate that they are now open for applications. But, what is StartMate?
Startmate is a group of startup executives offering mentorship and seed financing to founders of Internet and Software businesses based in Australia. Our first program is in the first quarter of 2011 in Sydney and applications will open later this year.
We want to help the most exceptional technically-focused founders create world class companies that solve customer problems.
The three month program offers a $25,000 investment, mentorship from more than 20 successful founders, sage legal counsel and a two week trip to Silicon Valley. At the conclusion of the program there are two demo days, one in Sydney and one in Silicon Valley, where you present in front of early stage investors.
We strongly believe in lean startup principles. The biggest risk in a startup is not whether someone will steal your idea or if you can build a product but rather that no one will care. Startmate is designed to help you win your first customers and work through the initial stages of customer discovery.
I have met a number of the mentors, and indeed, their names should be familiar with you, too. They have an exceptional depth and breadth of experiences related to high-tech web start-ups. Like me, some still occasionally get mistaken for uni students. They may not have grey hair, but that doesn't seem to matter in the GenY business world. They also have a huge heart for the younger entrepreneurs who may not even realize the global social impact their innovations may have.
Over the last couple weeks, the Sydney new ventures community has been on fire with events, including Tech23, the Young Entrepreneurs' Unconvention, SydStart, and Startup Camp Sydney (See also SMH article or ASB media release). Tonight is Seed Accelerator's Startup Networking Party, and CIE's Peter Farrell Cup is still coming up, too! A common element between these events were that there was always someone from StartMate there. The next wave of innovators are revving up, and the angels/mentors are now ready for business (from an email from Niki):
We've opened up the applications for the inaugural wave of Startmate. Folks can find out more here:http://www.startmate.com.au/application-process and apply here: http://hirehive.com/apps/488RSG
Applications will close at the end of November and the final round interviews will be held in early December.
Startmate is premised on helping small teams of technical founders get started on building great companies. More details on the program here: http://www.startmate.com.au/program-details The first wave of StartMate will begin in January of 2011 in Sydney.
Ready ... Set ... Go!
Saturday, October 9, 2010
StartupCamp Sydney going strong (Oct 8-10)
From time to time I have been popping in to check on StartupCamp Sydney IV. Sometimes in person at ATP Innovations, sometimes just checking Bart's twitter feed or the #sucs hashtag.
There are dozens of 30-second idea pitches online, and teams have gelled around 10 ideas listed on the StartupCamp website:
My favorite one has probably got to be the mash-up between ChatRoulette and Foursquare:
The whole collection of videos is available at:
2:00PM - Investor and business leaders arrive for Grand Final Pitches
4:00PM - Networking, Clean-up, Final Touches!
5:00PM - Close off StartupCamp IV
Hope to see you there!
There are dozens of 30-second idea pitches online, and teams have gelled around 10 ideas listed on the StartupCamp website:
My favorite one has probably got to be the mash-up between ChatRoulette and Foursquare:
The whole collection of videos is available at:
What's next??
The whole schedule of events is available at: http://sydneystartupcamp.eventbrite.com/
The next sections that are open to the public are:
Saturday 9 Oct at 9pm: Launches and Demos to Press, Party!
Each team has maximum 5min (and you will be cut off and this includes fumbling with laptops, etc) to pitch and give a live demo of their product. After this there will be 2-3mins in which the press can ask questions. This pitch is NOT for investors. This is where you get the world excited about your inventionSunday 10 Oct:
2:00PM - Investor and business leaders arrive for Grand Final Pitches
4:00PM - Networking, Clean-up, Final Touches!
5:00PM - Close off StartupCamp IV
Hope to see you there!
Tuesday, October 5, 2010
Business Plan Workshop for the PF Cup Competition
Dr Martin Bliemel will be running a Business Plan Workshop tonight.
WHEN: 5-6:30 PM
WHERE: ASB Lounge - 6th floor, West Wing, ASB building (E12)
BRING: Paper, pen, and questions
Please make sure you’ve reviewed the Simple Business Outline and Simple Business Model from the CIE’s Library & Tools page (first two items):
www.cie.unsw.edu → Resources menu → Library & Tools
(or http://www.fce.unsw.edu.au/nps/servlet/portalservice?GI_ID=System.LoggedOutInheritableArea&maxWnd=_ResourcesandLibrary)
If you’ve registered to join a team (and haven’t yet found one), this is the event to find that team!
See you this evening!
Wednesday, September 29, 2010
Online workshop: Venture Capital and Private Equity in the Asia Pacific Region
(reposted from an email)
The Asian Finance Association is pleased to invite interested academics and practitioners to submit papers and/or participate in an online workshop on “Venture Capital and Private Equity in the Asia Pacific Region”
The Asian region has an increasing role in the global venture capital and private equity market. However, there has been little research on the role/impact of venture capital and private equity in the Asia Pacific region. The aim of the workshop is to bring together researchers and market participants to discuss recent research on venture capital and private equity and its broader implications for practice and policy.
We invite authors to submit high-quality research papers on any aspect of venture capital and private equity with a focus on Asia Pacific markets.
Interested authors should e-mail their paper in Acrobat PDF format to:
Contact: Jo-Ann Suchard
Email: j.suchard@unsw.edu.au
no later than October 19, 2010.
Cost of participation :
Asian Finance Association members : Free
Non members : US$85 for non members to join the Asian Finance Association and includes subscription to the two journals of the Association : International Review of Finance and Pacific Basin Finance Journal.
INVITATION AND CALL FOR PAPERS
Online workshop
Venture Capital and Private Equity in the Asia Pacific Region
Tues 16 November
9.30am -11am Hong Kong time.
Organised by the Asian Finance Association and hosted by the School of Banking and Finance, UNSW.
The Asian Finance Association is pleased to invite interested academics and practitioners to submit papers and/or participate in an online workshop on “Venture Capital and Private Equity in the Asia Pacific Region”
The Asian region has an increasing role in the global venture capital and private equity market. However, there has been little research on the role/impact of venture capital and private equity in the Asia Pacific region. The aim of the workshop is to bring together researchers and market participants to discuss recent research on venture capital and private equity and its broader implications for practice and policy.
We invite authors to submit high-quality research papers on any aspect of venture capital and private equity with a focus on Asia Pacific markets.
Interested authors should e-mail their paper in Acrobat PDF format to:
Contact: Jo-Ann Suchard
Email: j.suchard@unsw.edu.au
no later than October 19, 2010.
Cost of participation :
Asian Finance Association members : Free
Non members : US$85 for non members to join the Asian Finance Association and includes subscription to the two journals of the Association : International Review of Finance and Pacific Basin Finance Journal.
Tuesday, September 21, 2010
Friday, September 17, 2010
Lessons Learned from Vancouver: The 4 Stages of a Rockin Startup Eco-system
This post is too good to not simply repost in full. Thanks Danny.
There isn’t a single regional area that I know of who isn’t desperate to building an internet technology industry in their city. When my wife and I decided to stay in Vancouver to raise our children, we made a commitment to do whatever we can to make Vancouver the best place to start an Internet company in the world. Lofty goal, yes, but hey, I’m an entrepreneur, and we’re a group who is plagued with unbridled optimism.
I’m not going to get into what mistakes most cities make, but I will say this: If you’re building an incubation/acceleration/mentor program first, and staffing it second, you’re doing it wrong. Each city has slightly different characteristics and what works for one probably means it wont work for another. The biggest of these differences is THE PEOPLE. Find the right people, empower them, and get out of their way.
For the first time in the last two years, since I have been working at building the eco-system in Vancouver, I feel like I finally have clarity about how to communicate the stages building and Internet Startup Eco-System, which I’m sure could be applied to any city:
Stage 1: INSPIRE
- About: This is the top of the funnel. There are many many people who have an interest of starting a company but just don’t think they can, or think they can afford it, or are worried about what might happen if they fail. At the same time, they probably can’t get thought of it out of their mind either. These people are entrepreneurs in making. They just need a little inspiration.
- Goal: 1) Reach new founders and encourage them to learn more about what it takes to start an Internet company, 2) create opportunities for them to meet co-founders and 3) convince them to quit their day job to start the company.
- How: Inspiration from networking and socializing with other members of the community. Events, Co-Founder speed-dating, Meet and study other successful founders and their companies, Universities. Dispel the myth that failure is bad. Trying is good, failure is experience, success is rare.
- Where: Inspiration can occur from many sources including: Universities, Trips to Silicon Valley, PR/Blogs, Industry networking events like co-founder speed dating, Stories from successful exits, Educational seminars.
Stage 2: HACK
- About: Okay, let’s say you’re a founder and you’ve just quit your day job. You love your idea. You may even have a co-founder already. What now? If you guessed that you should test your idea with customers, you’re right! But for god-sake, do it as quickly as possible with the least amount of money. In other words, hack something together, test it live, measure results, and iterate it daily. They’ll be plenty of time for optimizing your code once you find something that people want, but for now, hunt for the perfect user experience. This is NOT the time to raise money, write business plans, give powerpoint presentations, or project your financials performance.
- Goal: 1) Design mockups and develop prototypes, 2) Test ideas with target customers. 3) Run cheap customer development tests, 4) Educate, 5) Build community.
- How: Get a few laptops, fire up a Joyent instance, register a domain, start a blog and twitter account, create a google accounts for apps, analytics and adwords. Build some landing pages and start testing. And most importantly, start the conversation with your potential customers/users, listen to them, iterate.
- Where: I know now that any healthy eco-system requires that founders have access to an open public space to hack. A place with desks, couches, whiteboards, conference rooms, free WiFi, and, of course, the best coffee known to man. The space would give founders access to limited professional services, tons of advice from mentors, advisors and potential future Investors. But most importantly, it would be the focal point for the community. It would have a vibe that can only be created by the collective passion of the few who decide they can change the world with a simple idea in their heads. It would be a place designed by the community, for the community. The space must be subsidized by government, but most importantly, vertically focused on the Internet and operated by passionate members of the startup community.
Startup Metrics for Pirates, Dave McClure, Eric Ries
Stage 3: SEED/ACCELERATE
- About: Most founders are first-time founders. While extremely intelligent in building products that people want to use, they have a very limited network of people who have been through the experience of successfully starting and exiting a company. It’s these people who will provide the credibility they need, and help the founder prepare the company to raise financing required to grow. It’s clear, raising money is hard. Raising money from people who don’t know you is virtually impossible. Realistically, founders will need a credible introduction to even have a chance. Being accepted into a true seed accelerator is a great start, and the mentors that you work with while in the accelerator complete the picture.
- Goal: 1) Provide seed financing, 2) Measure customer acquisition channels. 3) Develop permanent relationships with mentors, partners, & investors. 4) Develop the investor pitch. 5) Transition from iteration to execution.
- How: There are a few examples of great Seed Accelerators run by even greater people. In my opinion, the team at TechStars, lead by David Cohen, is the leading the way. Seed Accelerators are NOT incubators. Seed Accelerators are unique from Incubators in the following combined ways, 1) Mentorship focused. 2) Provides a small amount of financing in exchange for equity in the startup. 2) Accepts only a small group of companies at a time, 3) Limited time, about 3 months. 4) Have a physical space.
- Where: Bootup, YCombinator, TechStars, Capital Factory, Montreal Startup, Extreme University, Year1Labs, and tons more. You can also emulate this by working your own professional networks to get introduced and invested in by Super-Angels.
Startup Metrics for Pirates, Dave McClure, Steve Blank
Stage 4: GROW
- About: By this stage, founders are finalizing the transition into a working company with the goal of optimizing current user acquisition channels, and discovering more. Although, product iteration never actually ends, it is much more focused on individual feature adds/removes/updates. Another way to put it: you change from searching for a product that works to optimizing one that starting to show traction. This is the time to put the peddel to the metel.
- Goal: 1) Fund the acquisition of new customers as fast as possible in the cheapest way possible 3) develop new acquisition channels 2) Reinvest revenue and/or raise funding.
- How: Need a $20M Series A venture fund to act as a local lead investor. Exits of companies within this fund, will attract additional investment funds to open offices in the region. The fund will invest in the best local companies it can find, but syndicate with highly connected and reputable super-angels and VC firms in Silicon Valley, New York, etc. This will bring investment from more firms into the local area more quickly than starting up new firms. This fund must be able to invest in companies outside the local region in order to be focused on making the highest return possible, but it is also very important to build relationships with well connected and experience firms who consistently get invited to invest in the creme of the crop.
- Where: A modern VC firm in the local area, preferably within the same building that the Seed Accelerator is in.
What's next? (pick one)
- Series B Financing. Further equity financing for growth. onward to becoming large anchor technology firm.
- Customer Acquisition Factoring. A hypothetical future financing model which I project will be available by the time any company starting today is ready for Series B. This concept deserves it’s own post, but essentially, in the same way banks factor receivables, they will begin to factor user acquisition channels negating the need for Series B VCs.
- Merger/Acquisition. There should NEVER be any strings or attempts made to keep the company in the local region. While the eco-system is ramping up, chances are a higher percentage of companies will sell to US companies, but not ALL of them. Over time, as the eco-system matures, more companies will stay.
- Organic Growth/Bootstrap/Lifestyle.
- IPO (an option, but only in very rare and specific situations)
- Fail - Entrepreneur gains valuable experience – goto Stage 2.
Net benefit to ecosystem
- Higher volume of startups started and a higher success rate.
- More high paying high tech jobs created
- Angels are created and reinvest.
- Increased foreign investment from VCs
- Investor confidence increases.
- Anchor technology companies.
- New entrepreneurs inspired, goto Stage 2.
My hope is that companies will start to feel comfortable regularly communicating which stage their in to each other and investors. Investors should also communicate which stage their interested in investing in. Aligning these two groups will help to eliminate a point of animosity between these two groups. Associations, Governments and Universities should communicate which stage their targeting with their programs. But an eco-system is only actually healthy and functional when all 4 of these stages are fully active, properly funded, and managed by passionate people who care.
One last thought before I anxiously await your comments. I’m sure you can cite specific examples of companies that “made it” by skipping one ore more of these Stages. Please keep in mind that I’m not saying that this is the ONLY way to build ALL companies. However, I am adamant that this is the only way to build a healthy, productive, Internet technology eco-system that produces a high quantity of world-class companies.
Wednesday, September 15, 2010
CIE Newsletter (Spring 2010 edition)
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