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Australia’s Technology Prowess: The Internet and Beyond

 

Asher Moses has written a wonderfully inspirational piece in the Sydney Morning Herald regarding the rise and rise of Australian entrepreneurial talent. In it he explores how well some of the Internet-focused startups born in Australia are doing in sourcing Silicon Valley venture capital.

It is a great story and touches on much of my experience over the past 15 years. Australia and, closer to home – Sydney, has an incredible wealth of entrepreneurs. But in Asher’s story there is also a hint at the dark side. Let me paint the picture in three ways:

1. Financial arrogance

While I was living in Silicon Valley I assisted a startup to raise its first round of funding from a tier one VC firm, in two weeks and right in the middle of the GFC. Fast forward to today and as Asher has eruditely pointed out, tier one VC’s from Sandhill Road are currently falling over themselves to get the attention of Australia web startups.

Against this backdrop, picture me meeting with a senior executive at one of Australia’s most successful investment banks in the past fortnight. In that meeting I was told how incredibly hard it is to find funding for technology businesses, how no-one is investing in this space in Australia and blah blah. Can you see the disconnect here?

I personally believe Australian ‘investors’ have a heightened level of financial arrogance driven by an absolute ignorance of technology and also tainted in their financial risk profiling by resource-based investing (mining etc).

As long as this position remains I can fully understand why Australian entrepreneurs are US-centric. For Australia though this amounts to a major loss as we are not only losing talent in droves, but also access to ROI as our entrepreneurs grow great businesses with other people’s money!

2. Technological bias

For as long as I can remember Australian government granting schemes and venture firms have had a bias against Internet-related companies. They have preferred to back biotech businesses and other science-heavy companies that are notoriously hard to scale globally and which usually have a hard time getting international attention due to the tyranny of distance.

It is heartening to see this position starting to shift and that web-focused ventures are in fact now getting more access to schemes like Commercialisation Australia.

3. Web-centrism

While I am ecstatic about Australia’s well deserved recognition (finally) for great entrepreneurial talent, I am somewhat concerned that we get seen as only producing web-centric talent and intellectual property.

The Australian Federal government pours some $9.8 billion into public research and there is incredible technology floating around within the countries 43 universities and even more public research institutes (by contrast the US only has 41 universities). However, most of this never sees the light of day. It gets locked up in over-protective tech transfer quagmires and/or stuck in the valley of death between research proof of principle and commercial proof of concept due to a massive lack of funding for this gap.

In contrast, in the UK companies like Imperial Innovations and the IP Group, and Allied Minds in the US, are absolutely going gangbusters building businesses around research intensive technologies and assisting IP through the valley of death.

Australia desperately needs a similar business and it is on my to do list for 2012 to see that one forms. We need to not only continue to support our web-centric entrepreneurs, but also inspire generations of Australians to become tech entrepreneurs in areas that can have major global impact such as energy and health!

 

Living in a Post-Geographical World: Address is Approximate (Hat Tip to Steve Jobs)

My family has been travelling since the 1670′s when two Du Toit brothers left France as part of the great French Huguenot movement. They went to Holland, which had recently begun colonising the tip of Africa. Recognising opportunity, they led a movement of settlers and arrived in Cape Town in 1676. The result was a wonderfully rich cultural mix (and some great wines) in the Franschoek region of the western cape of South Africa.

Fast forward a few hundred years and we dispersed to the UK and Australia when crime became all too pervasive. I’ve since also lived in the United States, and regard Sydney and Palo Alto as the closest things to home.

Like many others who have had similar experiences I consider myself post-geographical. It’s not where I am physically that matters, but what my mindset is, who I am interacting with and what I am aiming to achieve.

That’s why this video by Tom Jenkins resonates so much with me.

I love the vision he portrays and his message also talks to what Steve Jobs said many years ago in an interview, namely that the world we live in is made up of man-made constructs and constraints. That the people who created them are no smarter than you are and once you realise this you need never be constrained by them – create your own world, wherever you are!

Address Is Approximate from The Theory on Vimeo.

Palo Alto Pays Its Respects To Steve Jobs

When I lived in Silicon Valley I stayed for a while on an estate in downtown Palo Alto on the same street as the original HP garage. It was a special place, in many ways timeless – surrounded by massive redwoods and a quiet haven from the hustle of the 101.

But in the true Silicon Valley way it was also a seriously connected and yet very understated place. For example, one of the other cottages on the property was occupied by Tim Cook. At the time Tim was Acting CEO at Apple, but as we know he then went on to replace Steve.

One of my other neighbours, Bill Daul, made the following observation following Steve’s passing:

Palo Alto was a really quiet place today. Steve only lived 10 blocks or so from me…they were worried about people gathering at his home…only about 40 people were there. It is really strange to have one of the greatest businessmen of our time and all US time pass away here in our town. It is also sort of special how respectful Palo Alto is of Steve’s family.

Respect, Palo Alto-style.

I’ve added in some pics taken at Steve’s house by Susan Neville.

Tags: Palo Alto, Steve Jobs

It’s Obvious: A Rising Tide LIFTS All Boats

As followers of my posts will well know, I am a big fan of Ev Williams and the Obvious team, from the days when Twitter was a side project all the way through its massive growth.

So when they announce a new partnership I take notice – big time. Lift sounds really interesting and I’m looking forward to hearing and exploring it in more detail in due course.

My main inspiration for this post, though, were the comments made by Obvious regarding their ongoing journey in crystallising out their engagement model. In my view, these terms should be adopted by all companies as their core mission statement:

It’s important never to delude ourselves into thinking that technology changes the world. People are responsible for change – technology just helps out. At Obvious, our goal is to foster systems that help people work together to improve the world.

If you aren’t improving the world, get out of the way and let those who are do their work!!!

 

Entrepreneur’s Rule Numero Uno: Value First

In a wide ranging interview with Kevin Rose, Silicon Valley venture guy Chris Sacca unveils how he became so well connected into the Valley’s machinery.

The video is an hour long, but it contains some real nuggets of entrepreneurial wisdom.

The part that resonates most for me is when he talks about creating value, before you ask for value back. That for me is the number one rule for entrepreneurs: VALUE FIRST!

Chris continues this meme, “If you are insightful and helpful, people will gravitate to you.”

 

 

Foundation 07 // Chris Sacca from Kevin Rose on Vimeo.

Tags: Chris Sacca, Kevin Rose

Beyond Zynga (and Twitter): Social Gaming With Purpose

Don’t get me wrong, I’m a huge fan of game mechanics and social games – in fact one of the companies I’ve chaired (Creative Enclave) launched the first truly massively multiplayer social game on the Facebook platform in 2007. Back then, Zynga consisted of no more than a handful of staff. Back then people didn’t take social games that seriously.

Today, however, it is a totally different story. Social games are BIG business. Take a look at some of the stats emerging from the S-1 Zynga filed as it catapults towards an IPO: 38,000 virtual items are created within their game portfolio a second. Yep, you read that right – a second!

Zynga has 60 million DAUs (daily active users) and here’s the kicker for me: they conduct 2 billion minutes of play a day!!!

What is that telling you?

Some relatively privileged folks have a ton of idle time?

Play is really pivotal to the human psychi?

But are we at the point in our development as a species and as custodians for our planet where we can afford that much ‘down time’?

We still have people starving by their millions, we still have diseases that could be cured or prevented. Surely, we owe it to ourselves to focus on solving these issues before we embark on such wholesale frittering away of our time?

Yes and no.

YES, playing games like Farmville doesn’t progress humanity.

But also NO: I am not advocating that we do away with play altogether. Far from it. As I said at the outset, I am a huge fan of play.

What I am in favor of is social gaming with a purpose.

What if, in the course of having fun within a game, a user wasn’t only growing their capabilities as a mafia boss or trainmaster, but they were also (or instead) using their brains to help solve seemingly intractable disease puzzles?

Social gaming should help people come together to improve the world we live in. If we are playing games, let’s ensure they have a higher purpose. Let’s ensure they enable us to make greater insights into our pyschi, improving our understanding of our emotions, of our bodies and ultimately moving us to the point where we are not bounded by disease and scarce resources.

Aligned with this insight I want to draw your attention to the move by some of the Twitter co-founders back into The Obvious Corporation. I’ve written a fair amount about Obvious and product factories, but what is really interesting (especially in the context of this post) is the mission statement of the new Obvious:

The Obvious Corporation makes systems that help people work together to improve the world.The proliferation of technology can seem superfluous, but with the right approach, technology can benefit individuals, organizations and society.

It seems that others, like Ev, Biz and Jason are thinking along similar paths.

[As a footnote, I do recognize the great work Mark and the Zynga team are doing in supporting disaster relief. What I am advocating extends far beyond that focus.]

 

Tags: Biz Stone, Evan Williams, Jason Goldman, Mark Pincus, Obvious, Zynga

Y Combinator: Accelerating Start Ups, Recursively

Over a decade ago, back in the day of the initial tech bubble, I ran an early precursor to Y Combinator. In a similar vein we took on board nascent start ups in batches, with little more than an idea, and actively worked with the entrepreneurs to progress to the point where they were able to attract further investment from us and other investors.

And so I’ve been watching very closely over the years as Paul Graham has tweaked the Y Combinator model. There have been two excellent touch points recently for those of you interested in what YC does, how they choose which startups to work with and their model for success:

1. A comprehensive article in Wired – Y Combinator Is Boot Camp for Startups; and

2. Charlie Rose interviewing PG at TechCrunch Disrupt – see below.

One of the most amazing points PG makes in the interview is that the total value of YC companies is now around $3 billion. This is off the back of YC having invested a total of around $5 million. Now that is excellent validation for the model!

 

Tags: Charlie Rose, Paul Graham, Techcrunch Disrupt, Y Combinator

Kevin Rose, Evan Williams and the Rise and Rise of the Product Factory

Sarah Lacy has written a great post on Kevin Rose’s new company. The former Digg founder is setting up Milk, a closed innovation shop that, counter to the current Silicon Valley driven incubator-trend, will focus internally on developing up a small number of big hairy audacious game changing products that use the mobile Internet as their enabler.

Firstly, I’d like to congratulate Kevin – I believe he has hatched an awesome plan. Why? He isn’t reliant on bringing on board a steady flow of ‘quality’ entrepreneurs and then melding them to create winners, instead he is using his nous and that of a hand-picked team of coders, thinkers and innovators to quickly iterate ideas and test their viability, pivoting and repurposing when necessary, but always moving forward with a portfolio of potential winners.

Secondly, I’d like to highlight that Sarah has quite rightly picked up on the similarities between Kevin and Evan Williams.

A few years back, Evan and I were having a series of discussions (here, and here)  around product factories – I was infusing product factory magic into a major research lab in Australia and he had set up Obvious along similar lines.

Fast forward four years and his “side project”, Twitter, ended up subsuming everything else in the Obvious pipeline to the point where Obvious fell by the way side. Twitter achieved massive traction and in many respects has been a game changer.

In contrast, I managed to get a number of projects out of my factory – one of which, Open Kernel Labs, has achieved major traction with its virtualization software on 1.1 billion handsets around the world – and more to come. Although we both moved on from our respective organisations, Evan has come full circle recently and is again building up a product factory.

I look forward to seeing how both of them iterate on the product factory concept, how this influences a counter-incubator culture and what they both bring to market next.

Tags: Evan Williams, Kevin Rose, Milk, Obvious, Twitter

Asana: One Truth, Many Contexts – Revolutionizing Enterprise Software

I’ve spent many years in the wilderness that is Enterprise Software: from attempting to wake up SAP, to mistepping with Jive; from clucking over Bantam to writing Yammer’s first partnership agreement. In all these attempts to connect the corporate landscape I’ve always felt something was lacking. At first I attributed this to the fun, human factor, but even then I thought this wasn’t quite it.

Take a look at how so many people these days interact in their personal lives – for some, many in fact, Facebook is almost permanently open. They tap into the newsfeed in real time, sharing thoughts, conversing with friends and colleagues. Yet their work lives are seldom as enriched. They often have no clear picture of what is happening on their team, yet alone across their department or division, and as for the company proper – forget it.

And yet, finally, I believe my trek through the corporate desert may finally be bearing fruit. I believe I’ve seen the mother of all oases. Take a look through the lens of my telescope below and tell me – is this a mirage or has one of the co-founders of Facebook cracked it. Let me introduce you to your new best friend, both personal and corporate: your single source of truth – always open, always updated, always….ASANA:

Tags: Asana, Dustin Moskowitz

What’s It Take To Be The Quintessential Entrepreneur?

I’ve been working with entrepreneurs for almost two decades and see a constant stream of people knocking on my door. Many of them are looking for advice on how to hyper grow their business, how to source various resources – be that partners, staff or funding and on what choices to make given a myriad of options presenting themselves in quick succession – be that which channel to follow to market, what emerging technologies are disrupting their business model or how to respond to competitors.

TOP THREE ENTREPRENEURIAL CONSTANTS

I’ve noticed through my personal involvement  that while there are many fluid elements to being an entrepreneur, three things remain constant:

1. Entrepreneurs are ultimately hell bent on changing the world in some way. In many cases they are tackling a problem they’ve been confronted with and have formed a passion for creating a solution where one didn’t exist before;

2. Entrepreneurs have to deal with resource constraints. In the beginning they have an idea, no staff, usually no capital and no path to market. Somehow they find a way to work around these constraints and create an environment of abundance.

3. Entrepreneurs thrive on being immersed in a dynamic environment. Things are constantly changing in an increasingly fast paced world in which real time is often too slow – anticipating change and course correcting come naturally to entrepreneurs.

In my work I only have a finite amount of time I can dedicate to each entrepreneur I work with and so oftentimes I am faced with having to make choices about who I dedicate my time to. Over the years this has come down to a gut instinct and I have learned to trust this – ignoring it at my peril and the opportunity cost of working with other entrepreneurs.

In choosing which entrepreneurs to dedicate my energy to I look for how well they fit into the three entrepreneurial constants mentioned above. I do allow for the ability to grow and expand their entrepreneurial skill set, but ultimately the kernel of entrepreneurship needs to be very present.

The second generation Silicon Valley venture capitalist, Bill Draper, also has a set of constants he looks for in the entrepreneurs he works with. He discussed these in a recent interview with the International Business Times:

“I look for vision. I look for how much homework they’ve done on their idea, how closely they monitor the competition, how far they think ahead, and how much they know how the world works.

They also need to have energy, drive, and be sensitive to other people.”

Wise words from one of the legends of the space. Bill has recently published a book on his experiences titled The Startup Game: Inside the Partnership between Venture Capitalists and Entrepreneurs. Well worth a read.

Tags: William Draper