Startup VIC’s Retail & E-Commerce Pitch Night

As with the same event last year, this pitch night was again hosted at the Kensington Clik Collective. Going by the audience numbers, the retail tech and e-commerce start-up sector continues to generate widespread interest, despite (or because of?) the fragile state of most bricks and mortar retailing in Australia, and the onslaught of global online shopping from the likes of Amazon and eBay.

The four pitches in order of presentation were:


According to the founder, it all started with a scarf… and how he might have paid more for the item at the time he wanted it (but less than the retail price), compared to the eventual discount price a few months later. If only he had been able to bargain on the spot. Enter barQode – a location-specific app that enables customers to make an offer on an in-store item, and retailers to match or counter the customer offer.

To be clear, this is not (yet) a price comparison tool or even an on-line platform – it’s an app aimed at specific, location-defined, in-store purchases.

While simple in concept, the app does require a huge behaviour change by shoppers. Australians are infamous for being “price sensitive” buyers (not the same as being “cheap”, as one retail consultant once corrected me). Cost plays a huge role in purchasing decisions, especially as choice is often limited in a sector dominated by an oligopoly of brands, and a traditionally restricted market in terms of parallel imports and geo-blocking.

But barQode requires Australians to get comfortable with the notion of haggling, and that is quite a culture shift. Yes, some retail brands offer price matching against their competitors, but as this pitch pointed out, this is all about in-store purchases and prompting a more emotional engagement.

Most of the questions from the panel of judges focused on the competition, customer acquisition and market entry. Using a combination of platform fees and analytics services, barQode claims to be cheaper than the competing platforms, which also risk dis-intermediating retailers from their direct customers. Costs of acquisition were not disclosed, since the app is only in very select beta. The founders appear to be targeting discount retailers rather than selecting a specific category launch. This raises the prospect of only attracting bargain hunters who are already tempted by stock clearance offers (a race to the bottom?) – rather than engaging with select brands who can afford to yield some margin while potentially securing a new customer base.

The team claim to have a patent pending (they are working on image recognition, rather than simply relying on bar codes and other inventory data), and is seeking $350k in seed funding prior to a $1.5m Series A.

Epic Catch

Under the banner, “The social collective – date differently”, Epic Catch claims to be fostering organic connections via shared experiences for singles.

I have seen this start-up pitch couple of times before, where the initial emphasis was on being a new kind of dating service. But now, presumably with more experience and more market research, it claims to be addressing the “loneliness epidemic” – despite all the so-called “connections” people have via social media (and given recent events at Facebook, how much longer will that particular trend run?)  there is actually less and less personal engagement in the world.

According to data cited by the founders, in Australia, 35% of households consist of single people, a figure expected to reach 60% by 2036. At the same time, single people (neither age nor other demographics were defined) each spend an average of $12,000 a year on social activities. (It would have been interesting to see a breakdown of this spending pattern by consumer category, season, age, gender and location?)

The business model relies on a mix of subscriptions, commissions and affiliate fees, via a business partner model, member fees and booking fees. The founders are looking to raise $1.5m, primarily to fund marketing costs, as customer acquisition has mostly been organic, word of mouth, and SEO. To help them on their journey, the founders have appointed a solid advisory board, in their quest to counter the “fast food culture of dating and matching apps”.

Winery Lane

Winery Lane is a curated online market place, servicing independent wineries. Currently engaged on an equity crowd funding program (to raise $900k in return for 18% equity), the founders suggest that the $7.5b wine industry suffers from too many brands. A few large names dominate the market (by supply and by retail consumption), and a long-tail of boutique and specialist wine makers struggle for recognition (even though they often have a superior product). The biggest challenge is: producers can’t control the end distribution, especially small producers.

Winery Land has identified three core personas of wine lovers: geek, aspirational, and seeker. Their goal is to connect independent wine makers with this target audience, by removing the risk for sellers – through enabling them to share their wine-making narratives, and only charging a success-based commission on sales.

The business model is to target 50-60 independent wineries, and charge a 30% sales commission, while offering a 20% discount to customers on 12 or more bottles.

Asked by the panel (which included a representative from Vinomofo) about potential competitor Naked Wine, the founders claim they operate in different segments – in particular, their focus on selling genuine wines (and not running private labels).

Behind the platform is a data acquisition component – by “pooling” their mailing lists, participating wine makers can actually reach a larger (pre-qualified) audience. The judges felt that marketplace models for wine are still to be proven, and wine makers are naturally very protective of their customer lists, to whom they can usually pre-sell their normally small vintages.

[As a piece of random market research, the next day I spoke to one wine-seller representing a boutique producer at a pop-up market in the lobby of a CBD office building. He claimed that by participating in a growing number of these pop-up markets around Melbourne over the past 12 months, he had increased the size of their customer list 10-fold. When I asked whether his sales and marketing strategy included using platforms such as Naked Wine, his opinion was these services were often more like marketing software. They may also require producers to discount too heavily, that they resemble something of a bulk distribution model, and that it was akin to a “pay to publish” model for wine makers – based on the cost of getting stock on to the inventory. And while it isn’t perfect, MailChimp was good enough tool for building, engaging with and growing their customer lists.]


This SME marketing platform highlights a major paradox:  small brands engage better than big brands, but social media and e-mail engagement are both declining.

Using Instagram-based campaigns, Postie has doubled average campaign engagement to around 42%, and tripled typical click-thru rates to 6%. Postie has also reduced the time to create a campaign from 5 hours to 8 minutes.

While there is some template flexibility, there are limited options, as Postie draws on the Instagram design aesthetic.

According to the founders, there are 15 million brands on MailChimp, and 8 million brands on Instagram. What makes Postie different is that it owns its e-mail campaign client, and brands get to control their own retail inventory management.

Despite some of the challenges in SaaS marketing solutions, Postie has seen success with some specific verticals such as hairdressing, but admits that is hasn’t quite got the right product-market fit. As a result, and as a means to scale growth, Postie is starting to train users, to become more of a self-serve solution.

Somewhat surprisingly, the judges voted Epic Catch the winning pitch – I guess it is hard to ignore the founder passion, and the decision to pivot away from being a “traditional” dating platform. Meanwhile, the people’s choice (based on Twitter votes) was for Postie, and by a large margin – I suspect because many start-up founders, entrepreneurs and SME owners in the audience would welcome such a service for their own business.

Next week: The fate of the over 50s….

The art of #pitching – the long and the short of it… Pt.2

Last week, I commented on a short-form pitching event hosted by General Assembly. This week, I report on Startup Victoria‘s latest pitch night, “Pitch in Melbourne”, which may become a more regular fixture on the startup circuit. It seems we can’t get enough of these events….

Screen Shot 2015-09-13 at 9.37.32 pmIn contrast to “Out of the Garage”, “Pitch in Melbourne” was a more in-depth, long-form  pitch event, with only three teams competing (for a prize of $50,000 in seed funding), and all of them are currently going through accelerator programs. Their presentations were about 10 minutes each, with ample time for Q&A with the audience and panel, ably assisted by MC Leni Mayo.

The underlying idea was to reveal some of the thinking that prospective angel investors apply when considering new proposals. Even with the opportunity to listen in on the judges’ deliberations (who were effectively choosing where to invest some of their own money), it was still a slightly artificial exercise, because in reality, few investments are made after just a 15-minute presentation.

The pitches were reasonably proficient, although the market sizing, opportunity assessments and financials were a bit thin. One startup appears to be making potentially serious money, another has validated their model with a commercial client, while the third is still working out a go-to-market strategy:

SweetHawk has featured in this blog before, and is building integrated voice solutions for e-commerce and m-commerce. During beta-testing, SweetHawk has helped a venue booking agency to deliver more business to its clients. As a result, the team believe it will have most success with high-value, complex and non-commoditised products and services, where talking to prospects means much, much higher conversion rates from enquiries to firm sales. The service pricing model looks like it needs more work, and more market segments would need to come on board to demonstrate the commercial application. Experience also tells us that big-ticket B2B items are less likely to be bought on-line, and rarely after only a single touch point. Plus, companies usually have strict policies around employees paying for enterprise purchases with their individual corporate credit cards, require purchase orders to be raised in advance, and often outsource their buying to third-party procurement services.

parkhound perhaps likes to think of itself as part of the sharing economy (“an AirBnB for car parking”), except that it’s trying to create long-term contracts, not overnight deals. It also faces strong competition, not only from other providers within Australia and overseas, but potentially from AirBnB itself as it develops a similar add-on service following its recent deal with ParkMonkey. There’s also the prospect of that other darling of the shared economy, Uber bringing its app technology to car parking as well. So far, parkhound has signed up a solid inventory of spaces, and is starting to acquire some more substantial corporate accounts. However, spaces in commercial buildings and residential developments normally require dedicated hardware and other technology solutions such as smart boom gates to allow non-residents and non-tenants to gain access to secure areas. One suggestion from the panel was to sign up more residential spaces close to train stations – although such a strategy risks “off-platform leakage”, by cutting parkhound out of the picture if householders choose to go direct to market (e.g., via Gumtree or similar). Finally, there is evidence that car ownership is in decline among some sections of the population, and the prospect of driverless cars could mean we will only need between 10%-30% of the current number of vehicles on the road.

nuraloop are building customised headphones that are attuned to our own ears, incorporating some proprietary technology called earSync (“a virtual Cochlear”) that is designed to enhance the user experience when listening to music. I’ve seen the team pitch before (with some success), but despite the medical, scientific and engineering pedigree of the team, it seems they are only interested in the product application for music. Sure, getting TGA status is complex without medical evidence, but other options in the area of OH&S might not be so onerous to pursue. However, a bigger concern for the judges was the fact that the founders are not clear whether they are developing a hardware product, or seeking to licence their IP to other manufacturers. The good news is that most of the audience indicated they would subscribe to the crowdfunding campaign, and nuraloop won the audience choice.

Although it wasn’t entirely clear which pitch won the $50,000 (if indeed any of them did – specific term sheet negotiations weren’t going to be discussed publicly), I think it would have been a close call between SweetHawk and parkhound. One judge even suggested the two of them should be collaborating – but he was possibly biased. Despite the different startup domains, the judges were assessing the validity of the business models, the level of novelty/disruption, the teams’ strengths and capabilities, the commercial attractiveness of the idea, and above all the ability to execute and scale.

Both these events demonstrated that pitching is not easy, that there is a balance to be achieved between a slick sales presentation and a detailed analysis of the product/market fit. It’s certainly not just about the “idea”, and teams will be challenged if they can’t substantiate their claims or don’t come across as authentic or convincing. Ultimately, there’s no such thing as a perfect pitch (it’s all very subjective), but it helps when preparing to become pitch perfect!

Next week: Counterparty risk post-GFC

The art of #pitching – the long and the short of it… Pt.1

Pitch nights are popping up all over the place. So far this year, I have participated in two startup competitions where pitching was a core component, and attended at least half-a-dozen other pitch events. Some sessions were designed to help early-stage ideas find co-founders, some to showcase the results of accelerator programs, while others were full-on “show me the money” extravaganzas, where term sheets were put in front of the winning teams. The latest events represented two approaches to the format, organised by Startup Victoria (long form) and General Assembly (short form).

This week, the short-form – next week, the long-form.

Screen Shot 2015-09-13 at 9.36.06 pm General Assembly’s “Out of the Garage” Pitch Fest Party was not quite rapid fire, but the 15 teams only had 2 minutes each to present, faced some strict rules around format, and had no Q&A with the judges or the audience. The five winners each received a modest $1,000, plus some other perks to help them on their journey.

It’s impossible to do justice to the wide range of ideas that were pitched (and many of them were just ideas at this stage…), so here are my verbatim notes from the night, in the order of the pitches:

  • Animatly – DIY solution for making animated videos – “Canva for animated videos”
  • FolkFeast – good food more cheaply – “AirBnB for dining out”
  • RightClick – Intergenerational tech transfer – “young people teach old people how to use PC’s, tablets and smart phones”
  • Auug – Hardware device plus app that turns an iPhone into a motion-based MIDI controller and synth (as already featured in Apple ads)*
  • YearOutClub – “GoCompare for the gap year” – courses, content & accommodation
  • CareConnect – matching carers with clients, customised and personalised – Tech-driven. Big market: $13.5bn spent each year on care services
  • Good Packages – bio-degradable packaging
  • PetalBox – Single flower vending machines
  • VibeDate – “the best date you’ve never had” – curated dating experiences
  • NatureAtWork – re-connecting with nature, wellbeing and productivity
  • Wonderhood – market place for novel experiences
  • Project_O – “disrupting bottled water market” – art meets public water fountains
  • Joyality – Eco-psychology program for humans
  • Dunnit – “learn from someone who’s done it” – mentoring platform for creatives
  • LeanFilmmaking – agile process for creating video – technology is easy, finding audiences is hard… Idea to Audience: Fast – Accelerator program for story/audience fit

With limited exposure, it was difficult to know which pitches had real substance, but a couple are already in business, and a few have at least created a web profile. Several ideas sounded very similar to other new projects I’ve seen or heard of recently, and I would also recommend that all of the aspiring founders research their startup names before trying to register their companies. The winners were: Wonderhood, PetalBox, RightClick, Project_O and VibeDate.

Next week: Pt.2 – The Long Form

* Declaration of interest: I purchased one of the first units via their crowdfunding campaign, so I’m already a customer…