Pre-election Musings

At the time of publication, Australia is four days out from a General Election. At the time of writing, I have submitted my postal vote, as I will be overseas on polling day (May 18). I am certainly not going to call the result or predict the outcome, except to say it will probably be far closer than most people would have expected, maybe even a hung Parliament, with an even more fractious Senate. But I have to say that this has probably been the most difficult ballot I have had to complete.

Image sourced from The Donkey Vote

For one thing, I can’t see why either of the major parties deserve my vote. Plus, in my own constituency for the lower house, the ALP candidate has been disendorsed, so as a result, I have been denied the option of voting for the official opposition. (More on this disendorsement later.) (Meanwhile the only Green Party MP who sits in the lower house and who represents my constituency, labelled himself an “independent voice”. Does that mean he no longer represents the views of the Green Party?)

Why do I feel this way about the two major parties?

First, neither party leader inspires me – they are purely products of their political organisations and their respective factions, and display very few leadership qualities other than they probably know how to stitch together half-baked policy deals in their party meeting back rooms. I doubt they have ever had an original idea, and certainly not since they became the leaders of their particular factions, let alone leaders of their parties.

Second, both parties have simply been sloshing around tax payers’ cash – funding here, pork barrels there, sleights of hand all over the place. I agree that most areas of public services and infrastructure demand a rethink on their current funding models, and some deserve more money. But from what I have been able to glean so far, most of these funding commitments and/or budget re-allocations are mostly about headline amounts, and not measurable outcomes, assuming they have been properly costed in the first place.

Third, despite all the money on offer, there have been few, if any, announcements on more fundamental issues of economic and structural reform such as competition policy, productivity measures, innovation, startups, etc. Yes, there have been some financial and tax incentives thrown out to small businesses who take on more staff, or who invest in new equipment, but these are just the usual tweaks. And there has been very little debate about the need to review the design, delivery, quality and accountability of public sector services.

Fourth, and the one main thing that the major parties have in common, is that the only policy levers they seem willing to push/pull are continued fiddling about with tax rates, superannuation and industrial relations. All of which is counterproductive, as it just means the focus is on winners and losers, and the resulting class-war based “politics of envy” and crass take-downs of the “big end of town”.

So let’s talk about jobs.

Much of the money ear-marked for particular industries or service sectors is intended to support job creation. Where are most people employed in Australia? By industry category, the top sectors are: Health Care; Retail; Construction; Professional, Scientific and Technical Services; and Education. Most of which are destined to be the recipients of tax payer-funded largesse after the election. And while I agree that Health, Education and Public Infrastructure need to be adequately and properly resourced, innovation and the high-tech jobs of the future will more likely come from the Professional, Scientific and Technical Services sector. (And $3m for a “Blockchain Academy” is woefully inadequate for long-term thinking and vision.)

But as should be obvious to anyone, industries don’t create jobs, companies do. And most people in Australia (70% of the working population) are employed by small to medium-sized businesses. Of the nearly 2.2m registered businesses, 60% have zero employees (mostly they are owner-operated sole traders, including self-employed tradespeople), more than a quarter of businesses employ fewer than 5 people, nearly 10% of businesses employ between 5 and 20 people, 2.4% employ between 20 and 200 people, and only 0.2% of businesses (c. 3,800 companies) employ more than 200 people. In addition, only 100,000 businesses have an annual turnover of $2m or more. Welcome to the long tail of the Australian economy.

As for the election outcome itself, it will largely be determined by swing voters in marginal seats. Five of the 10 most marginal seats are in Queensland. And with the Adani mine project being such a divisive topic, this one item could determine who takes government. And even if Labor wins a majority in the House of Representatives, the Senate will be even more split between minor parties, and whoever wins government will find it difficult to navigate the upper chamber. In my own state of Victoria, there are something like 30 party groupings and around 80 individual candidates standing for just 6 seats. Trying to research the minor parties and their candidates or their labyrinthine preference deals is virtually impossible, which cannot be healthy for the democratic process under the proportional representation system of the single transferable vote model.

The real issue, though, is that with 3-year Federal Parliaments, parties are in perpetual campaigning mode. There is very little long-term thinking or vision, while short-term compromises are the order of the day. All of which results in either total inertia when it comes to making any real structural change, or constant policy tweaking to keep ahead in the polls. All hot air and no momentum.

Finally, coming back to the disendorsed Labor candidate for the lower house in my constituency of Melbourne. The party was forced to act (albeit somewhat reluctantly and almost equivocally) when the candidate’s social media past caught up with him. At first, the party and its Leadership suggested that the 29-year old candidate should be forgiven his indiscretions because he was “only” 22 at the time said offensive remarks were posted. I think that argument is total hogwash. If you are not going to be held responsible or accountable for the consequences of your actions at the age of 22, then you should not have the right to vote, get married, have children, stand for election, serve on a jury, sign a contract or take out a mortgage because clearly you have not fully developed as a mature adult, and your capacity to think and make important decisions is obviously impaired, such that you cannot be relied upon to exercise reasonable judgement.

Next week: Trends in LegalTech

 

 

Startup Vic’s EdTech Pitch Night

As part of its ongoing series of pitch events jointly organised with LaunchVic, Startup Victoria last week hosted the latest edition of its EdTech Pitch Night. Facilitated by General Assembly, Weploy, Marketing Entourage and VUInnovations, a quick audience survey at the start of the evening revealed that for 50% of attendees, this was their first Startup Vic event.

The panel of expert judges was drawn from Impact Generation Partners, Xplor, MAP and Education Changemakers.

The pitches in order of appearance were (websites links embedded in the names):

Studychatr

Tag line: “Improving student experience and graduate recruitment”

Many students report that they feel isolated, confused, and lack both a sense of community and a clear career direction. On the latter point, traditional recruitment firms and employers want to target emerging graduate talent, which can be expensive. Studychatr wants to make the hiring process easier for both employers and students.
Users gain access to a knowledge hub, through which students can earn Kudos points and StudyCoins for helping other students, and acquire micro-credentialing credits for their course work.

The service is free to students, whereas recruiters and employers need to pay via job ads, advertising, talent search, and student consultancy (essentially a Sideracket/Upwork/Freelancer/Airtasker-type service that enables companies to commission students to undertake research and other tasks).

With students wary of using existing college-provides LMS and campus portals, and placing less trust and reliance on “free” social media services, Studychatr has managed to strike partnerships with student societies as the key to on-boarding users, with 1,000 user sign-ups in the past 6 months.

Part of the employer/recruiter strategy is help them overcome the challenge of filtering candidates.

The judges were keen to know more about what the app measures – e.g., number of user posts, level of engagement, quality of study materials, depth of the collaboration – and how the AI model works in this context, and to what degree the platform moderates content, collaboration and communication. They also commented that the founding team and their advisors could probably benefit from some further diversity

InquiBox

Tag line: “Experiential learning through play”

How do parents access STEM tools? For InquiBox, the answer is a subscription service to curated educational activity boxes, plus a web platform. Costing A$29.95 per month, and launched in December 2018, the business is experiencing MoM active subscriber growth of 47%.

The judges wondered whether the content comprised unique materials or a compilation of preexisting components, what was in the online content, and what % of the items were Australian made? They also asked if there were any teachers on advisory board, and whether the STEM themes are integrated, given that the core subjects are taught as separate disciplines.

Based on subscriber feedback and the churn rate, some parents felt that the product was too early in their child’s education, or the boxes were too frequent, so there is an option to skip a month and to only select the topics of specific relevance. In future, there may be on option to track a child’s progress via the web application.

Sales have largely come from word of mouth referrals, but the team are planning to forge partnerships with schools, and link content to the curriculum, and develop engagement with the parent community.

RocketShoes

Tag line: “A next-generation education platform”

The founder pitched this as “an education platform where students own their own content”. Using a combination of Blockchain technologies (primarily IPFS for file storage, and NEM for assignment submission and time stamping) students can upload and manage their own content, and retain ownership of their data (unlike other open-source tools, some proprietary LMS and most social media platforms).

The judges asked who is responsible for moderating the content. While it can vary by jurisdiction, the obligation can largely lies with parents and education institutions, although in some cases it may be the students themselves.

The judges were also keen to understand the revenue model – in essence the schools pay, but if content proves to be more popular as measured by IPFS usage, the fees can be reduced. While something of a personal mission for the founder (hence the lack of detail on the commercials), a sensible decision has been made to adopt an API approach, whereby RocketShoes can plug into an existing LMS, and bridge different applications and platforms.

TALi

Tag line: “Happier kids start here”

This is a game-based cognitive training tool for children with learning difficulties, such as ADHD, ASD etc. It is designed to enable early detection and prevention. The tool has been patented, and uses touch-screen access and gamification to leverage the principles of brain plasticity muscle memory.

Key areas of focus are core cognitive functions of Selection, Inhibition, Focus and Control. The process is designed to be both repetitive and intensive. The game adapts to the child’s individual level. Claiming to be clinically proven via medical trials (of which TALi owns the research data), the TALi Train application has been classified as a Grade 2 medical device in the USA. Next up are TALi Detect (pre-school) and TALi Maintain (to extend the child’s development levels).

Distribution is via parents, healthcare and other service providers, and schools; it also has NDIS status in Australia. The tool is designed to be used 25 minutes per day for 5 weeks and can be implemented direct in schools, or in the home (under parents supervision). The key age group is 3-8 years old, before children with relevant learning difficulties are typically prescribed medication such as Methylphenidate (Ritalin).

After the votes were in, and once the judges had deliberated, the people’s choice was TALi, while the overall winner was InquiBox.

P.S. Startup Vic and Victoria University Innovations departments have joined forces on “Found”, a survey-based research project designed to “uncover hidden truths of the founder experience”, the results of which should influence the overall eco-system. Interested founders can apply to participate here: www.found-ed.com.

Next week: Pre-election Musings

 

Demo Day #2 – Startmate

The same day as the recent Startupbootcamp event, the latest cohort of 8 founders to complete Startmate’s programme in Sydney held their own Demo Day in Melbourne.

The pitches in order of appearance were (websites links embedded in the names):

Muso

A live music marketplace, connecting venues and artists. Venue booking managers are too busy to research available talent, and artists face an inordinate number of individual processes to manage bookings and post-event admin. So Muso joins the dots, curates the artists, and takes a share of the listing and booking fees. In a world where more and more independent artists are self-releasing their recordings via platforms like Bandcamp and SoundCloud, it makes sense to extend this to managing their own tour bookings. Muso already claims to have booked 400 gigs at an average fee of $300, and also plans to expand into the US, UK and NZ markets. Currently seeking $1.2m seed funding.

VAPAR

Fault detection in infrastructure is highly manual, subjective and very expensive. VAPAR is using machine learning and cloud hosting to automate the analysis of video footage for underground pipes and sewers. A task that can currently take 2 weeks to complete can now be done in 2 minutes. Clients upload their footage and fixed asset data via a web platform, and VAPAR generate a report based on the image scanning. The business model offers a free trial access, a paid pilot project engagement, and a price per metre of pipe. Currently seeking $500k in seed funding.

VEXEV

According to the founders, vascular disease is the single largest cause of death, so there is increased focus on detection and prevention. Measuring and tracking blood flow patterns can be expensive and invasive. VEXEV uses 3D imaging captured from safer and lower cost ultra-scan technology, to measure disease progression, and to monitor and predict patient outcomes. Already secured seed funding from Blackbird Ventures.

Glamazon

This is a marketplace for at-home beauty services, “bringing a salon experience to your own living room”. According to the founders, a beautician could earn $80 per treatment compared to $23 if they work in a salon. Glamazon also offers its own business management platform via a SaaS model.

Cogniant.co

An app to “predict and manage mental health disorders before they happen“. Offers a dashboard interface for clinicians to manage their client case load, using data collected on patients’ activity and behaviour via their smart phone devices and sensors. Looking to raise $1m in seed funding. My personal observation is that a key contributing factor towards certain mental health disorders appears to be increased screen time (social media, apps that track our every move, binge watching, constant content streaming and always being “on”), leading to increased isolation, among other symptoms. While I can see the value of the data capture and analysis, hopefully the process does not reinforce the negative connotations.

Pixelated Induction

Introducing ClickCharge, a scalable wireless charging system that enables any surface to become a conductive medium. Some may remember that Apple tried its own solution, AirPower, that quietly ran out of steam. ClickCharge claims to have 3 times the charging area of AirPower, and can even charge laptops, via its inter-connecting tile design. Having filed an international patent, the founders are seeking $1.7m in seed capital to fund the build of 40,000 units for which they are currently taking pre-orders.

Bioscout

A remote system for crop monitoring and disease detection, using airborne particle tracking and analysis. Having run some field trials with banana and avocado crops, the team has identified considerable cost savings for farmers, both in terms of produce protected, and reduced use of preventive chemicals. (With the industry currently spending $2.5bn on crop monitoring and disease prevention, yet still losing $2.4bn in damaged fruit, any savings must be welcome.) Remote devices provide real-time monitoring and alerts combined with an analytics dashboard. Cost is expected to be $30k per device, plus $2k per month. The latter is presumably to pay for satellite connectivity, as the founders discovered that a key challenge for farmers is the lack of mobile phone reception in remote and rural areas.

Live Graphic Systems

This startup is aiming to reduce the cost of creating branded graphics for live sports streaming, from $5k per game to $100 per game. Current solutions involve manual processes, custom software, expensive hardware and dedicated people to operate them. Live Graphic Systems offers a scalable solution that connects brands to live streaming events, at near-zero marginal cost.

Next week: Startup Vic’s EdTech Pitch Night

 

 

 

Demo Day #1 – Startupbootcamp

Energy and climate change are proving to be hot topics in Australia’s federal election campaign. Not surprising, given that proposed changes to current policy settings brought down the last Prime Minister. With that in mind, it was impressive and refreshing to hear what founders participating in the latest Startupbootcamp Energy Australia accelerator program had managed to come up with over the course of 12 weeks. The 10 projects presenting at this month’s Demo Day offered a range of solutions that our political leaders and their advisors might want to acquaint themselves with.

The pitches in alphabetical order were (websites links embedded in the names):

Builtspace

The challenge for many commercial building owners is that their facilities managers lack full visibility into the physical design and fabric of the infrastructure they are responsible for. And much of the in-house knowledge literally walks out the door when staff leave. Builtspace has developed a SaaS platform that creates a “digital twin” of each building, managing everything from the asset condition to real-time maintenance transactions, all connected in the cloud. Claiming to reduce ticket backlogs to deliver a 75% productivity gain, and a 5x ROI, including increased energy efficiency, the founders are currently looking for re-sellers in Australia, and are in the process of raising Series A funding.

Ecologic

A home energy audit app that offers tailored advice at scale, Ecologic uses cloud-based simulations to deliver proposed energy efficiency solutions and enables users to connect to appropriate suppliers. The team has identified that the combination of a lack of independent information, unknown costs (and limited finance) and inadequate service co-ordination creates a barrier to adoption for many consumers. In addition, consumers need simple and actionable insights. Currently generating referral fees and sales commissions, the founders are investigating a subscription model for Uber-style consultations, and a white label B2B solution. During the boot camp, Ecologic has obtained 1,500 customer profiles, identified a channel partnership model with a number of local councils, and secured a pilot integrated utility service with Energy Australia. To address the issue of consumers’ access to finance, the founders are exploring a project finance facility, to offer customers zero upfront installation costs, and using the energy savings to pay down the debt.

Elemize

Using a distributed energy model, Elemize claims to have found a solution to Australia’s comparatively high energy bills. Via its LiberPower application, the team are working with property developers and builders to help them install custom renewable energy solutions to deliver “free energy” to their residents and tenants. Part of the solution involves the system taking control of the batteries in each home, to obtain maximum efficiency.

Fohat

One of the problems with domestic-scale solar energy systems is that we can end up with too many solar units – which in turn can, with things like feed-in supply arrangements, cause network and transmission constraints. Fohat aims to solve this problem with a software solution to manage microgrids. With the owner’s permission, the operating system can have visibility over the whole network by taking control of each battery, by directing network capacity to where it is needed, and/or diverting excess supply into designated batteries. The platform also supports energy trading (but not at the level of individual consumers), and has recently secured a pilot with the City of Melbourne to install a microgrid and battery system at the Queen Victoria Market. The startup profile also mentions the use of blockchain technology, but this important aspect was not described during the pitch.

ivcbox

It was a little difficult to understand what this browser-based video chat service was doing at an energy accelerator. But the fact that it only takes a 1.5% sales commission compared to the 22.5% cost of a face-to-face sale, means it should appeal to energy retailers who have encountered greater customer churn due to price comparison sites and increased regulatory transparency on fees and charges. The service uses facial recognition and identity verification, which means the API platform can also be extended to banks and insurers.

Nostromo

Nostromo has developed a “world first” modular Ice Thermal Energy Storage system, using a glycerol heat conversion process. Typically, 60% of the peak energy usage by a commercial building is for cooling purposes, yet the peak demand amounts to only 400 hours a year. Designed to support demand side management and storage, Nostromo has secured $5.5m in seed funding, including $1.5m in grants to develop demo solutions.

Powerdiverter

Around 2 million homes and businesses in Australia are already using solar energy. Storing and managing that energy remains a challenge. Powerdiverter is a hardware device that uses electric hot water tanks as energy storage units. It doesn’t require any plumbing or additional electrical work. It plugs into the existing solar system to divert all the surplus energy into the tank. A typical lithium battery solution has a 12-year payback, versus 1.5 years with Powerdiverter. The business model includes device sales (7,000 have already been installed, mainly in the UK), a subscription service and licensing agreements with energy providers.

RedGrid

One of the problems with our current electricity network is that it is built on “imposed” grids, not coordinated intelligent devices. This means an overloaded grid, and high energy costs. RedGrid aims to solve this, with a Platform-as-a-Service model, where every smart device will have machine-to-machine communications, delivering energy on demand capability. This so-called “Internet of Energy” is constructed on a decentralised demand management solution that is private, scalable and secure. The team is currently focused on universities and facilities management, as well as consumer markets, and are planning a crowd funding equity raise.

Senno

In an era of growing concern about how social media platforms and other service providers harvest, trade (and compromise) our personal data, an increasing number of Blockchain-enabled solutions are using things like self-sovereign digital identity and attention economics to put consumers in control of their own data, and empower them to monetize these assets. Senno is using digital wallets to help owners secure their personal data and to determine who has access to it, in return for specified rewards. Where does this fit into the energy market? Well, Senno proposes to share (non-personal) data and consumer behaviour on energy usage with retailers, in return for a share of the revenue derived from the metadata, under a SaaS model.

UCapture

According to the founders, consumers want to reduce their carbon footprint, but they don’t want to pay to do so, they are reluctant to change their behaviours, so they need incentives to do so. Using a browser extension (Chrome and Firefox), UCapture enables consumers to shop online at participating retailers and “earn” carbon credits in return. Consumers can also receive coupon codes. UCapture receives a sales commission on each transaction, and allocates 2/3 of the commission to carbon offset projects. (While unexplained during the pitch, it seems that each purchase is calibrated to an equivalent amount of carbon offsets – whether that is based on the ticket price, or the actual carbon footprint of each item is not immediately clear.)  UCapture is enabling corporate clients to batch install the extension on their networks, allowing their employees to participate. On the positive side, UCapture is giving consumers indirect access to carbon credit schemes which are often only available to wholesale participants. On the negative side, it does seem incongruous to be encouraging consumers to spend more and to buy more stuff, in order to save the planet.

Next week: Demo Day #2 – Startmate