4 more #startup hopefuls pitch at Startup Victoria

Posted on April 19, 2016 by Content in Context

Is it just me, or are we seeing more and more B2B startups and 2-sided market makers, rather than consumer/retail opportunities? Based on the latest pitch night hosted by Startup Victoria it feels like B2C and “pure” app plays are in the minority. (Enterprise solutions are gaining traction, especially among portfolio companies.) Of the four latest hopefuls that pitched at inspire9, half were straight B2B, the other half were aiming at 2-sided markets.

First, I should declare that I know one of the teams who pitched, and I also know one of the advisors working with the other startups. But I have not let that influence my comments.

Second, the comments are taken from my contemporaneous notes, and appear in the order in which the teams pitched. That way, I hope to convey more accurately how the night evolved from the spectator’s point of view.

Third, the format was as follows: pitch, followed by comments and questions from the panel of judges, plus if time permitted, some audience Q&A – all ably compered by Monsieur French.

Pundit Connect

The goal is to streamline the recruitment of professional consultants. Currently at the pre-commercialisation stage. Building a 2-sided digital market place – a platform for posting project briefs and allowing consultants to bid on them.

Part of the current challenge is the lack of transparency/visibility on new projects – but there is also a lack of trust online.

Platform components include:

Member Connect – P2P, nested, trusted networks, with a particular focus on local government and local procurement (they see a growing need among regional economies)
Pundit Score – ranking tool built with help from Deakin University
Professional Services market place
Revenue model – subscriptions, fee for service, commission, data sales
LinkedIn integration – including individual consultant accounts

When asked about building critical mass, the team pointed to the fact that they are seeing 3 or more quotes for some projects posted in the market.

There was a suggestion that the platform could be reverse engineered, to enable clients to target niche talent, plus an option to work with professional associations.

When asked about Expert360, they felt it’s not really a competitor.

Angel Auctions

To paraphrase, this is like “Gumtree with a social conscience“. People can sell unwanted items online, the proceeds are donated to a charity of their choice, and the seller can claim a tax deduction against their donation. Meanwhile the site deducts a commission before distributing the proceeds to the charities.

The so-called “parallel economy” (charities and NFP) is considerable – 55,000 entities with DGR status, and 600,000 registered NFPs: 9 new charities are registered each day in Australia.

The “alternative” options for fund-raising are spam, telemarketing or street sign-ups.

Angel Auctions provides a private branded application for each charity. However, despite some active charity partners who have already signed up, the platform needs both traction and critical mass to develop multiple single-sided markets.

Meanwhile, there is some controlled leakage to aggregate auction sites.

The judges were somewhat critical of the relatively high commission rate – what value does this represent? They also asked about the integration with social media, and were probably a bit concerned by the team strength – it was clear this is something of a personal pet project.

When asked about the seller’s eligibility for a tax deduction, apparently there is an ATO ruling that the sale proceeds are treated as cash when donated by the seller. There was also a related question about transaction verification which I’m not sure was fully addressed.

Product Lighthouse

This is a content management and distribution platform for product information. It’s designed to make product info more accessible – content which is the lifeblood of consumer electronics retailing between manufacturers and retailers.

Currently, content is managed and posted manually, leading to data inconsistencies, errors, and inefficient distribution. According to the team, their “unified approach works for all”. They plan to further monetize the business (“pay to publish” model?) and add value through a standardised CMS and distribution platform. In particular, they are reducing the time to load individual SKUs onto the system.

One of the key universal benefits to equipment manufacturers, distributors, wholesalers and retail clients is the accuracy and integrity of the data input loaded by manufacturers, a process which will increasingly be automated and backed by a data dictionary.

So far, The Good Guys are using the platform as a channel to market, and Samsung is starting to load inventory.

Currently seeking capital of $300k.

The judges wanted to know more about the customer discovery process, and felt that the pitch perhaps contained too much information. In response, the team said their focus was based on actual industry experience and the known need.

MyMic

This is an app/software solution that turns smart phones into live communication devices at events, such as conferences and seminars.

Born out of necessity, the team has addressed the “dilemma of the last mile of delivery”. Anyone with the app loaded onto their smart phone and a connection to the event’s PA system running the installation can submit content via their device. (Apparently, audio-visual can represent up to 40% of event costs.)

The app can be used to broadcast live voice, capture text and comments, as well as audience polling. The system is platform agnostic, and the IP is being registered.

Asked about monetizing the technology, the team are proposing a mix of per event, per month and per user licensing models. At this stage, the product is still in beta, but the team were alert to the opportunities in Asia. (Sadly, due to the Pitch Night’s “No demo” rule, we were unable to see the system in action. Pity!)

Finally, there were some technical questions on latency and live operation. It can run on a WiFi network, and can be controlled by a moderator. Other connectivity options may be available, including Bluetooth and wireless.

Later, as part of an open Q&A with the audience and the teams, the judges gave some general feedback to the teams:

focus on a single purpose or proposition;
don’t forget to introduce yourselves properly;
get appropriate tech skills on the team; and
be positive (as well as authentic)

On the night, Pundit Connect came first based on audience votes.

Next week: “I’m reframing, the situation….”

Latest #FinTech Round-Up

Posted on April 12, 2016 by Content in Context

The first quarter of 2016 has seen some significant FinTech developments in Australia. It feels the sector has finally “come of age”, at least in terms of government policy, as well as some significant deals. For anyone who may have missed the action, here is a very brief round-up:

The formation of FinTech Australia as an umbrella group in late 2015 was seen as an important step in reducing inter-state rivalry. Following its first AGM in March, hopefully it will help the industry to attract further visibility, gain critical mass and co-ordinate the debate around legislation, funding, compliance and regulatory licensing, as well as fostering innovation and collaboration.

At the same time, the Federal Government has established the FinTech Advisory Group composed of some heavy hitters and key influencers. One of the first outcomes has been the Treasury’s response to a number of regulatory changes that the industry is prioritizing.

Having spoken to several members of both the Advisory Group and the FinTech Australia Committee, there is a clear sense that the industry has finally “broken through” to get on the ideas and innovation agenda.

FinTech Melbourne hosted a very interesting Meetup on Women in Fintech, set against the backdrop of the continuing gender diversity debate (in particular, across tech startups). An all-women panel comprising Charlotte Petris from Timelio and Jemma Enright from MoneyBrilliant, and facilitated by Anita Kimber from EY, explored some of the opportunities and challenges (and the struggles along the way) of being a startup co-founder, their experiences of launching new businesses and products, and how they go about hiring the right talent and building great teams.

Meanwhile, in London, The FINTECH Book was being launched, which includes a contribution written by DragonBIll‘s Melbourne-based CEO, Luke Hally.

Over at the MBTC , the Melbourne Bitcoin Meetup group hosted Brave New Coin‘s CEO, Fran Strajnar. Fran gave a detailed presentation on the market news, financial data and analytical infrastructure that Brave New Coin is building to support crypto-currencies and block chain technology, including the new Bitcoin Weighted Average Price (aka B-WAP). This new analytic will likely prove to be a key component for real-time and historical pricing data on specific bilateral transactions (e.g., calculating end of day evaluations or annual tax reconciliations), as well as providing underlying reference data (e.g., for index-linked instruments and associated derivatives, swaps, options and forwards). Exciting stuff indeed!

Finally, ASIC, as part of its work in building a more supportive regulatory environment (under its Innovation Hub) has announced a bilateral agreement with the UK’s FCA on greater co-operation between the respective market regulators, that may lead to mutual recognition for FinTech companies. Another similar deal is being explored with Singapore.

Next week: 4 more #startup hopefuls pitch at Startup Victoria

Whose IP is it anyway?

Posted on March 22, 2016 by Content in Context

Why should we claim ownership of our IP? This was the topic up for discussion at the recent Slow School dinner on Collaborative Debating presented by Margaret Hepworth. I won’t reveal how a collaborative debate works (I recommend you sign up the next time Slow School runs this class…), but I do want to share some of the issues and insights that were aired. In particular, the notion that shared knowledge is the basis for greater prosperity.

The use of Creative Commons means knowledge becomes easier to share (Photo by
Kristina Alexanderson, image sourced from flickr)

First, the discussion centred on IP issues relating to ideas, content, knowledge, creative concepts and theoretical models. Not surprising, as the participants were all independent professionals, consultants, bloggers, creatives, facilitators, teachers and instructors. So we didn’t address the areas of patents, registered designs or trade marks.

Second, as someone who has worked in the publishing, data and information industries for nearly 30 years, I believe it is essential that authors, artists, academics, musicians, designers, architects, photographers, programmers, etc. should be allowed both to claim copyright in their work, and to derive economic benefit from these assets. However, I also recognize that copyright material may often be created in the course of employment, or under a commercial commission or as part of a collaborative project. In which case, there will be limitations on individual copyright claims.

Third, the increasing use of Open Source and Creative Commons means that developers, authors and end users have more options for how they can share knowledge, access resources and foster collaboration through additive processes and “common good” outcomes. A vital component of these schemes is mutual respect for IP, primarily through acknowledgment and attribution. Equally, an online reputation can be established (or destroyed) according to our own use of others’ material, especially if we are found to be inauthentic.

Leaving aside the legal definitions of IP and how copyright laws work in practice, the discussion explored the purpose and intention of both authors (as “copyright creators”, narrowly defined) and end users (as “licensees”, broadly defined). There was general agreement that sharing our content is a good thing, because we recognise the wider benefits that this is likely to generate.

But there is a risk: merely acknowledging someone else’s authorship or copyright is not the same as accurately representing it. Obviously, plagiarism and passing off someone else’s ideas as your own are both copyright infringements that can give rise to legal action. Even with the “fair use” provisions of copyright law, a critic or even an acolyte can mis-interpret the content or attribute a meaning that the author did not intend or even anticipate. As one participant noted, “Copyright is not just concerned with what we claim ownership over, but what others may claim as their own.” Not for nothing have we developed “moral rights” in respect to authorship of copyright material.

Although we did not discuss specific issues of copyright remuneration (e.g., through royalties, licensing fees or financial consideration for copyright assignment), there was a proposition that establishing copyright protection can lead to social, intellectual and even economic limitations. The understandable, but often misguided need to protect our copyright (as a form of security) is driven by fear, underpinned by scarcity models. Whereas, a more generous approach to copyright can actually lead to greater shared prosperity, based on the notion of the abundance of ideas and knowledge. And since, as one speaker put it, “there is no such thing as an original concept because all ideas build on previous knowledge”, the inherent value in IP is in how we contribute to its nurturing and propagation.

At the end of the discussion, and reflecting on my own recent experiences with copyright infringement and geo-blocking, I found I had shifted my position – from one that tends to take a more absolute view on copyright ownership, to one that identifies the need for some further modification to the current copyright regime, along the lines of the following:

Copyright ownership should not entitle the owner to abuse those rights – if anything, the copyright holder ought to be placed in a position equivalent to a trustee or custodian, to ensure that they act in the best interests of the IP asset itself, not merely their own interests. That should not preclude the owner from being compensated for their work or being allowed to commercialize it, otherwise, why would anyone bother trying to create new ideas or content?
Establishing copyright in ideas and creative concepts needs to be supported by a notion of “intent” or “purpose” (a bit like mens rea in criminal law). For example, if the intent is to merely prevent anyone else using or sharing the idea, then any copyright protection might be limited to a much shorter duration than the usual “life of author plus XX years” model.
Equally, under a “use it or lose it” provision, if copyright owners (and/or their publishers, distributors and license holders) elect to take their content out of circulation from a market where it had been widely available, then they would need to establish good cause as to why the copyright should not be open to anyone else to use and even commercialize (subject to reasonable royalty arrangements).
If we accept that all knowledge is additive, and that the proliferation of collaboration and co-creation is because of the need to share and build on what we and others have already created, how can we ensure the integrity and mutual benefits of open source and creative commons initiatives? One analogy might be found in the use of blockchain technology to foster contribution (adding to and developing an existing idea, concept, model or platform) and to support authentication (to validate each idea extension).

Perhaps what we need is a better IP model that both incentivizes us to share our ideas (rather than rewards us for restricting access to our content), and encourages us to keep contributing to the furtherance of those ideas (because we generate mutual and ongoing benefits from being part of the collective knowledge). I’ve no idea what that model should look like, but surely we can agree on its desirability?

Next week: Finding purpose through self-reflection

#StartupVic launches new-look #pitch event

Posted on March 8, 2016 by Content in Context

The team at Startup Victoria have been working hard over the summer: not only have they brought on a whole bunch of new commercial sponsors, but they have also launched a new format for their pitch nights. The idea is to invite startup founders to register their interest in pitching to a panel of judges. The contestants get the opportunity to compete in front of a live audience, for a chance to win face time with local VC’s, along with some other startup goodies.

It’s not Shark Tank (there’s no hard cash on offer), nor is it an open mic night (there is a pre-screening and audition process) – but it does enable entrepreneurs to test their pitch, get some early exposure, and receive some great feedback and advice. It also doesn’t matter what stage the startups are at, although businesses that already have some market traction or have built and tested an MVP are probably in a better position to compete.

The launch night saw pitches from four startups, who are at various stages of development. In no particular order they were:

Ad Hoc Media with Passenger Pad, a digital Out Of Home advertising medium for taxis, using interactive touch screens inside the cab. To date, there has been a low take-up rate of this technology by the taxi industry in Australia, mainly due to regulatory issues, but the landscape is changing. With a background in taxi electronics and hardware, the founders are about to launch with 400 taxis in Melbourne, and plan to expand to other cities. There is no doubt that using a combination of passenger, location and fare data (duration, time of day, pick-up and drop-off points), the screens will be able to offer brands and their media buyers targeted audiences and in-depth customer analytics. The challenge will be to offer advertisers a competitive rate card, especially as this is essentially a new medium: it offers viewer choice like TV, can serve up targeted content like web or mobile, and is ideal for special offers linked to location and time of day.

Global Patient Portal offers a free platform for e-health records. Having already launched in Kolkata, India with 40,000 users signed up in 11 weeks, GPP is aiming at lower socio-economic communities and emerging markets. The initial business goal is simple: to support ownership of e-health records by users. Using a combination of bootstrapping and NGO funding, GPP has been able to hire a team of “scribes” in India who sit in on patient consultations and capture the medical notes, which can then be referred to at the next consultation. (Currently, a lot of time and resource is wasted because patient records are captured on paper, which is easily lost once the patient leaves the clinic.) Commercial revenue will come from selling anonymized patient data (subject to legal compliance, privacy obligations and data accuracy) for research and policy planning purposes. In choosing to launch in Kolkata, GPP was aware that in some more affluent urban communities in India, the favoured means of patient communication is WhatsApp?, so they would be less likely to adopt a separate platform. Also, in Australia, having talked to GPs about the various government attempts to establish the e-health system for patient records, I am aware of a reluctance within the medical profession to buy in to the scheme: first, there is no financial incentive for them to capture patient data via a common e-health platform; second, why would they want to share patient data with their competitors?

prevyou is aiming to disrupt a large part of the recruitment and job ad market, by directly connecting students with job opportunities at SMEs. The two-sided market effectively crowdsources available jobs from SMEs, who typically do not have access to the hiring market or to full-time and dedicated HR resources. The goal is to streamline the hiring process, and to offer a mix of standard and premium services (e.g., video resumes, applicant screening, skills matching, personality profiling etc.) and later to add validation of applicant credentials and qualifications. In return, the business will take a commission once a job has been offered and/or candidate hired. While the focus is initially on capturing the market for casual and part-time jobs, the judges urged them to look at the enterprise HR market (under an outsourcing or white label model?). Looking ahead, there is the opportunity include student internships (although, like the legal issues with Year 10 work experience, internships and placements present additional challenges such as achieving student learning outcomes and other employment law issues).

OurHome is an app to help families manage, share and track household chores, so that children learn to take some responsibility around the house, and they can get rewarded for their contribution. It emerged out of an earlier app, Fairshare, that was aimed at shared houses. Apparently, people living in shared houses don’t care enough about whose turn it is to clean the bathroom, or are happy with paper charts and lists on the fridge door. Describing itself as “an integral household tool with indirect network effects (i.e., like Google, not Facebook)”, OurHome also claims to be the #1 chores app. Using advanced algorithms, and other features such as customisation and Dropbox integration, the app also introduces an element of gamification through rewards (intrinsic and extrinsic). For busy families, it replaces those fridge notes and task charts (although, as the judges noted, there’s no calendar yet). Of particular interest is the very positive feedback the team have had from families who have children with ADD.

Despite a few technical glitches (concerning mics and audio quality), the first new-look pitch night was a success, and Global Patient Portal won the on-line audience vote. I was luck enough to meet with one of the teams a few days later. They thought it was a useful experience, but they hadn’t quite known what to expect, and they had anticipated more of a grilling from the judges and tougher questions from the audience.

Next week: More In The Moment

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