metarand

Australian Venture Capital: Super Shake Up

BusinessWeek has a great profile piece on prolific early stage venture capitalist, Josh Kopelman of US firm First Round Capital:  Super Angels Shake Up Venture Capital. The article’s take is to delve into the world of investors who are running counter to the cycle. While everyone else is running away from risk, these guys are running into the fire and making investments.

A core premise behind the piece is that in an IPO and acquisition-starved market, the math of billion dollar VC funds doesn’t add up. Enter the traditional, venture capital as cottage industry style fund - smaller, leaner, more agile and definitely more entrepreneurial, similar in nature to the people it invests in and both able to identify with and nuture successful entrpreneurs.

It’s a good article and well worth the read.

I am witnessing somewhat of a shake up in the VC industry in Australia at the moment as well. Together with two partners, I’ve been running Innovation Bay since November 2003. At the time I was an early stage VC and there were a number of other players in the market. Over the next 5 and a half years though, the VC industry has gone through some major contractions. The number of active VCs has totally shrunk, yet the demand for capital and savvy advice has continued to rocket.

Fast forward to mid 2009. Innovation Bay is hosting a new format event on the 9th June. We are putting on an Angel Dinner for a select subset of our members, many of whom easily fall within the BusinessWeek rubric of ’super angels’.

We are inviting along two technology entrepreneurs to pitch their ventures. I’ve been truly amazed at the number and talent of the entrepreneurs who have approached us with a view to being chosen. The hardest part for me is that I’d love to have them all along, but alas we have to limit the numbers for this event.

The demand, though, does point to a real need in Australia and I am hopeful that the newly announced Commonwealth Commercialisation Institute will play a major role in satisfying this demand.

I am also going to be a judge in a pitching competition for creative projects called Back My Project. It is part of the Creative Sydney festival of ideas and has a pool of cash behind it. Come along to the MCA on the 4th June if you are in Sydney - it will be loads of fun. It is all part of Vivid Sydney, the “biggest international music and light festival in the Southern Hemisphere”!

We Asked And iPhone 3.0 Will Deliver: Micro-Payments

As Last 100 points out the recent announcement by Apple that the next version of the iPhone software, 3.0, will enable In App purchasing will be a huge boon for micropayments.

This is a huge step in the evolution of the iPhone platform towards a fully-fledged ecosystem. I also anticipate that it will bring about a boost in virtual goods.

Gizmodo thinks this is bad news, but meh, what do they know!

Next Line On The iPhone Horizon: Micropayments

Apple has a tried and tested approach of creating complete, yet simple ecosystems and the one it has developed for the iPhone is testament to this genius.

However, ecosystems need to evolve or they devolve to the lowest common denominator. Much has already been said about the “commoditisation” of apps to very basic one offs with gimmick appeal.

Allowing for a deeper level of engagement within an app is key to this “appolution”. And one of the most important steps forward in achieving this in my view is to open the spigot for micropayments.

Om Malik has also called for this:

I would be spending a lot more if Apple extended the API to allow for the ability to transact within apps.” Nothing like buying a song, an application or a ringtone with a simple click, only to be billed in a batch, later. Such buying habits are the reason why we believe Apple’s iPhone could prove to be an ideal micropayments platform.

Mapping Minds: Google Trends Meet Twitter Thoughtstream

Two of the most powerful tools for currently mapping how humanity thinks are Google Trends and Twitter Search.

I whipped up an analysis of Google versus Twitter on Google Trends and the result put Twitter far ahead in our collective consciousness. This is a really useful tool for tracking across a timeline, with clear pointers to inflection points, but it does nothing for point of origin or realtime tracking.

This is where Twitter’s Search function shines. I did an exercise last week in which I tracked a number of key words on Twitter. “jobs” not surprisingly brought up a bunch of results, mainly from job board feeds, “Sydney” alerted me to a number of interesting events taking place in the city, but the clear topic du jour was the “iPhone” - the amount of traffic on Twitter related to this device was enormous.

Imagine if we could mash up these two tools, and extend their reach beyond Twitter’s audience - this would be an extremely powerful way for marketers, politicians and many others to map our minds.

Hattip to Erick Schonfeld for getting me thinking about this.

Feed Your Social Media: Facebook Grows On Attention

I have been a huge advocate of feeds - they are an incredible attention grabber, able to keep users engaged and as a result drive up traffic on social media sites.

Take the Twitter phenomenon - and apply it to the real world analogy of being in a coffee shop having a conversation or penning an email when you overhear something - just the sound of a keyword or two can grab your attention away from your current activity.

Facebook cottoned onto this recently and as Eric Eldon over at VentureBeat points out, this has been hugely to their advantage.

Contextualizing Your Social Networks: Reid Hoffman

Michael Arrington, who is supposed to be taking a break from blogging, has a great Davos interview with LinkedIn’s Reid Hoffman.

Key takeout:

MySpace is like a bar, Facebook is like the BBQ you have in your back yard with friends and family, play games, share pictures. Facebook is much better for sharing than MySpace. LinkedIn is the office, how you stay up to date, solve professional problems.

Radio Silence: Replaced By The Newsfeed, While Silicon Valley Hums Quietly In The Background

First up, to my regular readers my humble apologies for not blogging for a few weeks. I had a busy month - what do they say about living in interesting times - yip, that is how it has been.

When I have found the time to feed the meter, as it were, I’ve turned to the newsfeeds. Mostly I’ve kept up posts on Facebook and to a lesser degree, Twitter.

I think I am not alone in this shift: blogging less, posting more.

I’m heading back to Sydney this evening for a few weeks and will hopefully have a bit of breathing space to do some more considered posts.

Let’s see how that pans out. If you are in Sydney and would like to meet up please ping me - I look forward to getting a grip on how the tech space has progressed downunder.

I’m also very happy to let you know that despite reports to the contrary, Silicon Valley is alive and well. One of the companies I am advising has gone from zero to term sheet in less than two weeks. I am keen to see more of the same!

Open Kernel Raises $7.6m Series B: Embedded Virtualization And Entrepreneurial Spirit Wins Out

Congrats to Steve, Gernot and the team at Open Kernel Labs on closing their funding round. We embarked on the journey of spinning them out of NICTA three years ago and they have grown from strength to strength. This round is not only a testament to their quality as entrepreneurs, but also to their tenacity - they started this fundraising as the economic crisis came roaring through.

Sadly, I heard this news on the day I had a farewell lunch with the board at the company I was running, Piclinq. They have elected to follow a different path through the turmoil and the result was a parting of the ways.

As I continue my entrepreneurial journey, I wish the OK-Labs team and all other entrepreneurs safe travels!

Silicon Valley: Secret Weapon For The US Economy

I once took Kevin Maney for a flight over Sydney in a seaplane. He didn’t blink when we buzzed low over the Sydney Harbor Bridge. Similarly his steel nerves shine through in an absolutely awesome piece he has written for Portfolio.

Silicon Valley thrives in times like these. True entrepreneurs rise to the challenge and innovation and, subsequently, the economy as a whole benefits. As he says:

During a recession, Silicon Valley doesn’t curl up into a fetal position and pout. It continues to take chances, throwing sparks at kindling, knowing that something will catch fire. It’s the U.S. economy’s secret weapon.

Extending The Publishing Paradigm: Book As Souvenir

Innovation guru John Wolpert is always pushing the envelope. And so it comes as little surprise to learn that he is innovating again.

This time his innovation is within the publishing arena with the release of his first novel, The Hidden Stage.

Set in a civic theatre not unlike the one in John’s hometown, he was inspired to write this story by a trip to his local theatre in 4th grade. He recalls how he had to go to a play there, and thought he was too cool to go.  He remembers having a serious attitude about it.  But half-way into the show, he became totally mesmerized.  The end of the first chaper of The Hidden Stage has a moment for the main character, Alex Cole,  that is not dissimilar to something that happened to him - and it changed his life.

John believes that a lot of professional writers are starting to wake up to the notion that you don’t have to print heaps of dead tree in advance in order to publish.

The new way - and while the concept of this isn’t new, the practicality of it is very, very new - is to focus on your maven market (in the case of The Hidden Stage, the 100,000 volunteers and professionals at civic theaters in the US), go viral with them, and give them the ability to order the book on Amazon.

He found that using Scribd.com was also a huge bonus.  He is able to tell exactly how the book is doing online.   In ten minutes, he had the whole book - all 450 pages - online and embedded for reading on both his own site and on Scribd.com.

John’s strategy was to first write a compelling book that was a page-turner and then to really lower the barrier to reading that first page.  As reading any book is a serious investment of time, the cover and the site were fundamental to getting that first page read.

He scripted a Flash website to give potential readers a really good sense of what they would be getting if they embarked on reading the story.  Then he gave them a simple one-click path to reading the whole book online, and finally there is the link to Amazon.

John also points out that there is an alternative through Amazon, which is not self-publishing, but simple print-on-demand through BookSurge.  Instead of authors having to put up $$ to do mini print-runs, finally print-on-demand is here.  He says it costs a little more for the book buyer, but it is great that we can finally get books into readers’ hands without having to line the pockets of publishers…all the rest is tapping the market and knowing your audience.

What he’s seen so far from feedback is that people start by reading the first page just to see what it is about.  Then they read a bit more, because the story is exciting.  If the whole story was not available for free online, he suspects that he would not be getting readers to even try the first few pages…it’s psychological.   But then they decide they want the printed book, and can get it from Amazon.

As they say:  “If your idea isn’t good, you lose.  If your idea isn’t viral, you lose.  If people don’t want to buy your souvenir, you lose.”