Article by Tony Kaye written for the Digital Harbour Website
Even with a fantastic idea, getting good projects off the ground is often difficult without the right knowledge, the right connections and ready access to capital.
But the path for many innovative Australian ICT companies has been made a lot smoother, thanks to the efforts of Digital Harbour-based Business Strategies International.
BSI, formed in 2001, actively assists ICT companies with raising capital, accessing government grants and business advisory – effectively opening doors that most start-up ventures would not even know about.
Every three months, BSI holds investor forums in Sydney, Melbourne and Brisbane, where it showcases innovative companies to around 200 high net worth individuals and funds. These companies have great technologies and the potential for exponential growth to export markets.
“Our whole purpose is to help companies to grow,” says BSI director Ivan Kaye, who co-founded BSI with business partner Alan Milwidsky. “Over the last three years, BSI has showcased 110 companies and, of those, 50 have raised finance in one form or another. In total, more than $30 million has been raised.”
BSI is sponsored by the Victorian Government through its VicStart Program, and by the Federal Government, which supports BSI’s Australian Distributed Incubator (ADI) fund. ADI is a $7 million fund that invests in ICT companies and has a joint venture to invest with another fund, Information City. Both ADI and Information City have invested in 35 companies since the program started.
Leads also come through from the Federal Government’s COMET Program, which provides finance to help companies get investor ready and validate their products for export markets.
“COMET rates BSI as a leading player in the industry and they refer a lot of companies to us to help them in the quest for raising capital and getting investor ready,” Mr Kaye says.
BSI is also a leading player in accessing the Government’s R&D tax concession and tax offset. “If you have tax losses and spend less than $1 million on R&D and turn over less than $5 million, you can actually cash in those losses as opposed to increasing the size of your tax loss,” Mr Kaye adds. “We help companies maximise that rebate and work on a success fee.”
Other support is for companies seeking to access the Export Market Development grants program run by Austrade.
Among the many interesting companies that BSI has supported is the automated document delivery group ConnXion, which is now listed on the Australian Stock Exchange. BSI has also incubated a company called EMStream, which streams music and video content to more than 200 pubs and clubs around Australia.
“We have supported many very interesting companies,” Mr Kaye says. “I love every one of those companies. They all have potential for exponential growth. They are all in various forms of incubation – not large companies but hopefully one day they will become large companies. It’s great that we’re supporting their foray in Digital Harbour.”
BSI has also invested significantly in assisting companies on a recruitment level, particularly given the specialist expertise required in the ICT sector.
“Over the years, as our clients have increased in value, and have increased their staffing levels and turnover, a major constraint that they’ve had is to recruit the right people,” Mr Kaye says. “We acquired a recruitment business (BSI People) in 2001 that has grown from three people to 30 people thanks to the skills and leadership of William Maudlin.” BSI People have acquired focussed recruiting companies, including Livingstones (recruitment of office and administration personnel) and Learned Friends (Legal Recruitment).This year, BSI People won the prestigious SARA award of “best executive recruiter of the year.”
BSI has also ventured into the Training Space, and together with Graham Raspass heading BSI Learning, they have developed a training business that provides strategies consulting and training in the areas of change management and leadership skills. As that business has grown, it has acquired other registered training organisations including Southern Edge Training and Hume Learning.
BSI holds regular events for the innovation community and has an entrepreneurial Masters Class Series involving high-profile speaker presenters. Last month Martin Hosking, a co-founder of Looksmart, presented to 80 people at Digital Harbour.
BSI is on a strong growth path, and in the last four years it has grown from a turnover of $1 million to $15 million. The company was voted the third-fastest upstart company by BRW magazine.
“We work strongly with alliances and view alliance partners as a major part of our business,” Mr Kaye says. “We’re very proud and look forward to the next stage of our journey, which hopefully will include setting up BSI internationally into marketplaces such as the US, Israel, Europe and South Africa.”