Monday, September 28, 2015

Hatchtech provides significant exit for Australian VCs

Blue sky, Oneventures, Uniseed, FBs Ventures and QIC has just had an exit with biotech startup Hatchtech, securing a deal worth $280m

Hatchtech is a biotech focusing on the treatment of HeadLice.The technology company offers the only treatment effective in killing both hatched lice and their eggs in a single treatment.

Elaine Stead of Bluesky says that the investors worked well to add value to the startup. 

Hatchtech has reached a commercial agreement with Indian-based Dr Reddy’s Laboratories for upfront and pre-commercialisation payments of $84 million and commercial milestone payments of $193 million.

Blue Sky invested in the Melbourne-based health-tech company in 2013 as part of a $12 million syndicate led by OneVentures.

“The company executed its strategy perfectly and this is precisely in line with the investment thesis,” she says.

it’s a great result for investors, and for the Australian venture capital sector.

“It’s an excellent example of what can be achieved with world class research, innovation and management teams and collaborative venture investors.” 

Wednesday, September 23, 2015

Atlassian software firm founder Scott Farquhar's tips to make Australia rival Silicon Valley

From Abc - Lateline 

The Scott Farquhar and Atlassian story is one of fairytale success. 

Mr Farquhar met Atlassian co-founder Mike Cannon-Brookes when they were both studying business information technology at the University of New South Wales in Sydney. 

They became friends, founded the software company in 2002 and by 2014 were listed on BRW's Rich List as billionaires - both aged 34. 

Last year, Atlassian's revenue was $450 million. They employ 700 staff in Sydney and 1,000 around the world, plus they donate 1 per cent of annual profit, 1 per cent of employee time and 1 per cent of company equity to philanthropic projects. 

Both co-founders were raised in Sydney and are desperate to keep their company from moving offshore, but Mr Farquhar says Australia is years behind even developing nations when it comes to fostering the tech industry.

Scott Farquhar spoke to Lateline about what the Government can do to make Australia a global player in technology: 

1. Change the curriculum in schools:

"There's a huge need to focus on science and technology, particularly computer science. There's a huge need for emphasis on those subjects for us to be competitive in the 21st Century. I read the Government paper on the national curriculum talking about technology and it mentioned teacher training seven times in their recommendations. I think for us to teach STEM (science, technology, engineering, maths) subjects and computers, it really comes down to training teachers in the workforce or allowing those subjects to be taught outside of school."

2. Encourage more girls and women into the field: 

"There's a phrase that I heard on stage the other day that by Year Eight it's too late and so you need to get women studying science and technology and computers early on. When they realise that they're actually better at it than boys at an early age, they continue their studies. So I think there's a big need early in high school careers to get more women involved in science subjects."

3. Check out the overseas models:

"Vietnam starts teaching computer science in Year Four and it's a compulsory subject all the way through high school and as a result their entire populace is graduating understanding computers. I just came from there last week, they've got an incredibly burgeoning technology industry there so I think they're doing a good job."

4. Build a technology hub in Sydney:

"Sydney needs a technology hub. We're working with the Government to try and convert ATP (Australian Technology Park) in Redfern and retain that as a technology park with Atlassian moving in there. If you look overseas there's a lot of examples, whether it's Shoreditch in London, or Silicon Valley or Roosevelt Island in New York. You need to create an epicentre so you can attract talent from all around the world."

5. Encourage best and brightest to come to Australia:

"In Silicon Valley I can walk down the street and find hundreds of people that are really difficult to find in Australia today. We're trying to change that. There's not a critical mass here. People say I'd love to come and work for Atlassian, but if it doesn't work out for whatever reason, I have to relocate my family home because there's no other job for me to get here."

6. Make it easier for start-ups:

"A lot of start-ups can't afford to pay their early employees and in return... companies often give shares in the company to renumerate the employees. If the company does well then those shares are worth a lot and then the employees do well. As part of some previous legislation the ability to do that was made very difficult by one of the governments. [It's now been reversed.] It's made it a lot easier now for us to allow our employers to share in the benefits of Atlassian, so if Atlassian does well we hope to create tens or hundreds of millionaires in Australia because they've been part of Atlassian.

Why I can't invest in you if you don't invest in yourself

Great article by Daniel Mumby

Being an investor isn't as easy as it sounds. It often requires you to ask very difficult questions, like:

"Why would I invest in you when you won't invest in yourself?"

Pitching for money is as much dark arts as science. So many elements go into the equation that equals success, and all it takes is one of the multipliers to be a zero, for the outcome to also be zero. That might be

  • track record, metrics/traction, story/message, persuasion factor, personality, audience or a hundred other factors.

One of the key elements that is often not talked about, and therefore often ignored by founders (but rarely ignored by investors), is your propensity to invest in yourself. What effort have you put in (beyond googling a phrase or 10, and downloading some free templates) into actually learning your trade or craft?

How much

  • effort have you put into research, preparation, learning, delivery?
  • did you prepare for difficult questions during the Q&A section of your pitch.
  • research have you done in targeting the right types of investors?
  • actual researching, testing and learning have you done in your target product market?
  • have you progressed in building a prototype, testing actual paths to market, or in creating partnerships?
  • 'skin in the game' do have (in cash & labour) on your own venture?
  • have you invested in your professional learning for the market in question?

Because if your answer to any of these is "not much", let me be frank - (in the words of Darryl Kerrigan from "the Castle") - "tell him he's dreamin' ". You are not just unlikely to get investment - you just won't. And I don't mean from me; I mean almost no investor.

"Why", you ask?

Well apart from the reasons I listed in earlier, you aren't competing for the attention of just investors in a vacuum; you are competing for their attention in a crowded field. As an investor, I get in the region of 25 cold approaches a week (which is a lot less than many of my peers). Do you know how many I've invested in? Zero . Yes, not one. 

Because few have done their homework; almost none, refer to my background, history, or investing intent. Fewer still reference my investor criteria, or past investments and almost none look at my articles about what it takes to go from big idea to successful entrepreneur.

 Because those that do, already know how to approach me. They don't behave like startup amateurs. They get introductions from people I know and trust. They engage in asking questions about whether I fit their team, (and that they fit mine). They ask 'value' questions, not price. And they determine early whether we have shared perspectives, values and beliefs. 

And they don't send me reams of business plans (that no investor reads), or pages of reasons why I should invest (who even invented the 'spray & pray' approach?).

Every investor is different, and they will have their own list. For some it's team - for me, it's founder - because that person is the one who draws the team to them.

Here's what I want to see.

And you are prepared to do just 2 things to succeed

  1. the first step and
  2. everything else that it takes.

If you can do these things, that's what will get my attention.

If you like this article and got value from it,  please 1/ share it, 2/ follow-me for more insight, and 3/ you can check out some of other my other posts. 

To your success, Daniel

About Daniel

Also traveling under the alias of 'That Startup Guy' , I am a co-founder of StartUp Foundation(The Startup Accelerator for Experienced Professionals) and am intensely, deeply, passionately dedicated to "The intersection between personal mastery & business entrepreneurship".

Sunday, September 20, 2015

Malcolm Turnbull future proofing Australia

 “We are not seeking to proof ourselves against the future. We are seeking to embrace it.”

Prime Minister Malcolm Turnbull has unveiled an “extensive” Cabinet reshuffle and has more than doubled the number of women at the highest levels of government, and has a clear focus on innovation.

As with any reshuffle there were winners and losers, with many of the losers close allies of Tony Abbott, who was ousted in a party room coup last week. Joe Hockey (quitting politics) and Kevin Andrews being (not happy).

 Outgoing defence minister Kevin Andrews will be replaced by Marise Payne, who is Australia’s first ever female defence minister and is one of five women in the cabinet and two women on the National Security Committee.

“She is one of our most experienced and capable senators,” Mr Turnbull said of Senator Payne, a former chair of parliament’s foreign affairs and defence committee.

Scott Morrison is the new Treasurer. (Read more about Scott Morrison here.)

Christopher Pyne has been installed in a wide-ranging super ministry – Industry, Innovation and Science – which would be at the heart of the government’s efforts to be more innovative, agile and “nimble in the way we seize the enormous opportunities that are presented to us”.

Newly-promoted Arthur Sinodinos was appointed the Cabinet Secretary, while Josh Frydenberg has been reassigned from the Assistant Treasurer’s portfolio to Resources, Energy and Northern Australia.

Kelly O’Dwyer has been named the Assistant Treasurer and Minister for Small Business. Matthias Cormann remains the Finance Minister.

Progressive senator Simon Birmingham was given Christopher Pyne’s education portfolio.

Mitch Fifield’s success as a junior minister and key role in helping Mr Turnbull marshal the numbers was rewarded with a promotion to Cabinet as minister for communications and the arts.

Julie Bishop retains the foreign ministry, Peter Dutton keeps immigration, Andrew Robb holds trade, Sussan Ley keeps health and Greg Hunt keeps the environment portfolio.

Who’s who in the new Cabinet

Malcolm Turnbull – Prime Minister

Scott Morrison – Treasurer
(Promotion: former Minister for Social Services)

Julie Bishop – Minister for Foreign Affairs

Marise Payne – Minister for Defence
(Promotion: former Minister for Human Services)

Christopher Pyne – Minister for Industry, Innovation and Science
(Promotion: former Minister for Education)

Michaelia Cash – Minster for Employment and Minister for Women
(Promotion: former Assistant Minister for Immigration, Minister Assisting the PM for Women)

Kelly O’Dwyer – Minister for Small Business and Assistant Treasurer
(Promotion, former Parliamentary Secretary to the Treasurer)

Arthur Sinodinos – Cabinet Secretary
(Promotion, had no Cabinet role)

Simon Birmingham – Minister for Education and Training
(Promotion, former Assistant Minister for Education and Training)

Christian Porter – Minister for Social Services
(Promotion: former Parliamentary Secretary to the Prime Minister)

Mitch Fifield – Minister for Communications and Minister for Arts
(Promotion: former Assistant Minister for Social Services)

Josh Frydenberg – Minister for Resources, Energy and Northern Australia
(Promotion: former Assistant Treasurer)

Mathias Cormann – Minister for Finance

George Brandis – Attorney General

Peter Dutton – Minister for Immigration and Border Protection

Warren Truss – Minister for Infrastructure and regional Development

Barnaby Joyce – Minister for Agriculture and Water Resources

Sussan Ley – Minister for Sport and Minister for Health

Andrew Robb – Minister for Trade and Investment

Greg Hunt – Minister for Environment

Nigel Scullion – Minister for Indigenous Affairs

Tuesday, September 15, 2015

Super funds and Tech Entrepreneurs create $200m Australian tech venturefund

(Sourced from AFr)
An exciting development is happening in the VC space in Australia. The super funds are looking at this space as an asset class and is looking to allocate a small percentage of the Trillion dollars or has into this sector .
As Malcolm  Turnbull says. - this is an exciting time for Australia!
The new fund, managed by Blackbird Ventures, has been backed by 96 technology entrepreneurs including Atlassian co-founder Mike Cannon-Brookes, Martin Hosking of Redbubble and Leigh Jasper of Aconex - as well as two major superannuation funds, First State Super and Hostplus Super. 
The fund will target exclusively Australian tech companies.
This is a major breakthrough for Australian innovation!!
Other active players in the market are Daniel Petres Airtree Ventures ($60m)  and Square Peg Ventures .

Square Peg Ventures is backed by Liberman , Bassat and Packer - and back global tech companies - looking to invest $5m plus.... There is no size of this fund but is made up of a consortium
of investors that back deals on a case by case basis.

First State Super has invested most at $110 million, and its chief investment officer, Richard Brandweiner, said it was a relatively low-risk, but important move. 
"It is a lot of money for the ecosystem, but it's a tiny proportion of our $58 billion under management," Mr Brandweiner said.
"The super sector has become so large in Australia that we need to think about our impact beyond just returns for our members. This also about investing in the country, because we need lots of strong technology companies in the future, and if we can help them stay here, that's a win for everyone."
While the super funds make up majority donors, investment decisions are made solely by the Blackbird managing committee: Mr Scevak, Rick Baker and Bill Bartee.
Blackbird focus on companies with global growth potential, rather than companies making Australian versions of successful existing overseas models.
Its existing investments (70pc software) include design software Canva, cryptocurrency platform CoinJar, human resources insights software CultureAmp and education software Edrolo.
A major factor is backing people who are committed and passionate about their innovation.