Are Start-Ups a young persons’ game?

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Last week’s Lean StartUp Melbourne meeting was devoted to the AngelCube accelerator program. Given some of the high-profile start-ups that have come through this process, it was hardly surprising that nearly 400 people turned up to hear various AngelCube alumni share their personal experience (as well as to enjoy some free beer and pizza, courtesy of the evening’s sponsors: inspire9, BlueChilli, Kussowski Brothers and PwC).

First up, there were lightning talks by 3 successful program graduates: the team behind fantasy sports app developer C8 Apps, Ash Davies from self-publishing platform Tablo, and Phil Bosua, the technical genius at LIFX who designed the WiFi-controlled LED bulb. All of them vouched for the benefits of the AngelCube program, and offered key learnings – such as “fail hard, fail fast, fail forward”, and the value of having a disciplined weekly cycle of iterative product builds. Access to quality mentors was also a key factor.

Then Indi from OutTrippin joined the guys for a Q&A panel session, facilitated by AngelCube co-founder Nathan Sampimon.

Some of the accelerator program insights on the night were quite revealing –

  • it’s all about product-market fit
  • a solo founder will usually struggle on their own
  • be prepared to either pitch or pivot at the weekly program reviews
  • the $20,000 seed funding (for 10% of your business) doesn’t go far…
  • a B2B concept is less likely to be accepted to the program (due to longer sales cycles)
  • the model is founded on lean methodologies, frequent iteration and getting to an MVP
  • people with at least one start-up project behind them tend to do better
  • the AngelCube angels are investing in the team as much as the idea

But are start-ups really only for young(er) people? This question has been posed by Dan Mumby, from Melbourne’s StartUp Foundation, which offers a different sort of program aimed at would-be entrepreneurs who may have all the trappings of middle age: family, job, mortgage…. which means they have different personal and financial risks to consider.

On the other hand, as at least one AngelCube participant said, if you are serious about founding a start-up, “your first job is to quit your job”.

Another, broader challenge facing the local start-up community is a lack of serious investor interest. According to one panel member, “In Australia, getting funding is a joke unless you are literally digging for gold”. This may change with the launch of VentureCrowd an early-stage equity funding platform. (But it looks like it will be a struggle – at the time of writing, none of the 20 or so deals publicly showing up on VentureCrowd’s website have attracted any funding.)

An alternative funding model, based on the sweat equity principle, is a venture bank, like New Enterprise Services that essentially matches ideas with expertise through a risk-sharing process.

I always recall the advice I was given by one serial entrepreneur when I asked him whether start-ups are for everyone (regardless of age). He replied: “Unless you can afford to invest at least $20,000 in your idea, and support yourself for at least 6 months while you develop it, then maybe it’s not for you.”

Radio comes of age in the social media era

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About a year ago, I posted a blog on “Steam Internet” which included some ideas about the importance of radio as a communications platform – even in the age of social media.

Among the individual responses I received, a former colleague recalled how he grew up with radio, and how it was a significant presence in his life as a source of news and entertainment – it kept him company while revising for exams, and allowed him to “share” songs with this friends (via personalised mixtapes). He commented that a pharmaceutical company in Indonesia uses radio as a mainstream outreach channel – because it is relatively cheap, it offers targeted demographics, and it provides access to a large-scale, mass market.

He went on: “Radio is probably still the most effective medium to reach out to large audiences – it is targeted, it is always ON, it is always entertaining, it has loyal followers, and it does not require the listener to have an expensive receiver. More importantly, radio traditionally reached a far larger percentage of the population than what the Internet does today, especially in large developing markets.”

Consumer interest in and demand for audio content is recognised by today’s media industry – hence the growth of podcasting, audio platforms like SoundCloud, streaming services such as Spotify and Pandora, and radio apps like TuneIn – not to mention the growth in Internet radio, digital stations and web-streaming broadcasts.

I tend to agree that radio, after more than 100 years, still offers “new” opportunities for reaching an audience, even Gen Y – but as with any content strategy, it pays to get the model right by:

1. Having great content (plus engaging presenters and skilled producers)
2. Enabling access (broadcasting via any platform, anywhere, any time)
3. Cultivating a strong programming culture (i.e., scheduling and curating a logical flow of information, and across multiple platforms)
4. Encouraging audience participation – radio thrives on giving people a voice, either through phone-in sections, community-made programming, or connecting via “traditional” media such as SMS and Twitter

Radio is also very local (despite global access/reach via apps like SoundCloud Radio) and is usually subject to broadcast regulation. I’ve been involved with a community radio station over the past 3 years, and it has made me aware that audience diversity can be a challenge for broadcasters (how to cater for smaller, minority audiences?), but at the same time many people feel unconnected to mainstream media, such that radio is actually their preferred platform to engage with the world.

Acknowledgment My thanks to Rudy J. Rahardjo for his input to this article.

CRM systems and the KISS Principle

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I’ve recently been working on CRM implementation projects, and I am astounded at the level of complexity that some systems have managed to impose on the organisations that deploy them. Paradoxically, the complexity is usually the result of either data models that are far too rigid, or data entry standards that are far too flexible – so that users have to find “work arounds” or create a whole new business operating model to accommodate their CRM….

For example, changing some data labels can be impossible (e.g., “Client” may have different applications, but the system only recognizes one type), and I have seen a client name entered in multiple ways within the same database: J.P.Morgan, JPMorgan, J P Morgan, J. P. Morgan.

When working with such CRM platforms, I’m frequently reminded of the KISS Principle (Keep It Simple, Stupid) as being the preferred approach to systems design, or as the architect Heinrich Tessenow eloquently put it:

“The simplest form is not always the best, but the best is always simple.”

Has streaming killed the video store?

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In the era of Quickflix and internet TV services, why would anyone continue to patronise a bricks and mortar DVD shop? Well I, for one, am a  regular customer of my local independent video store, and here’s why:

First, choice. Clearly, they don’t have every film or TV series ever made, but there’s more than enough to discover during my lifetime. And they stock loads of titles not yet available to stream or download in Australia. (See previous blog on geo-blocking – and at the time of writing, Netflix is not available in Australia.)

Second, they have a great international selection, and their catalogue is not dominated by the latest Hollywood blockbusters. They have a particularly good section of art-house titles, as well as all-time classics, mainstream comedy and big-name dramas.

Third, it’s cheaper. There’s a minimal sign-up cost, no monthly subscription fees, and on average, the nightly cost of a DVD rental can be far less than alternative services. Plus, with most of their DVD’s, you get the bonus material not always available via streaming.

Fourth, it’s quicker. I know this sounds counter-intuitive, but with the slow internet speeds in Australia, it actually takes me less time to walk the few blocks to the video store and back than it does to download a full-length film.

Fifth, the staff make informed recommendations. OK, recommender engines are getting more and more sophisticated, but many still seem to be based on what people bought/downloaded, and not so much on what they actually watched, and really liked. But the video store staff are very knowledgeable about films, and having watched a lot, they can usually offer some personal suggestions based on what I have previously enjoyed.

Finally, the local DVD store is something of a community service, and for that alone I will continue to support it.