Some experiences from early-stage Australian startups

Looking out from Downunder

Some experiences from early-stage Australian startups

David Jones

ICTI Cluster June 09

Context/History OEM Channel Enterprise Consumer EmU Tech Reach Software 90’s 2000 2003 2004 2006 2009 High Touch Low Touch NetWorth

Definition: “startup” “ A new business venture in its earliest stage of development.” “ but the phrase "startup company" is often associated with high growth, technology oriented companies. Investors are generally most attracted to those new companies distinguished by their risk/reward profile and scalability .” (Wikipedia) david DOT jones AT gmail DOT com | skype://djinoz | Cell:+61 412 683 111 | @djinoz

The Australian “upstart” $$$ Team Skills Mentors and Relationships david DOT jones AT gmail DOT com | skype://djinoz | Cell:+61 412 683 111 | @djinoz Customer Pool

Wishful thinking…. david DOT jones AT gmail DOT com | skype://djinoz | Cell:+61 412 683 111 | @djinoz Australia: Not a great track record here X

Now what? Market Changes or slow execution… a common “underfunded aussie story”. david DOT jones AT gmail DOT com | skype://djinoz | Cell:+61 412 683 111 | @djinoz X

VC’s role in creating wealth (more wishful thinking) But experience for future success it built by trying, failing and trying again. david DOT jones AT gmail DOT com | skype://djinoz | Cell:+61 412 683 111 | @djinoz

Focus or Fail (picture credit: Mick Liubinskas/Pollenizer ) If you have limited resources and cash reserves then focus is your most valuable discipline – if you get it wrong at least you “fail fast” david DOT jones AT gmail DOT com | skype://djinoz | Cell:+61 412 683 111 | @djinoz

Austria or Australia? Sustainable sales come from a larger market …. But global (non-bespoke) products tend to have more price competition david DOT jones AT gmail DOT com | skype://djinoz | Cell:+61 412 683 111 | @djinoz + 612??? Where is the “+” ?

The reality:

is that 70-100% of revenues for US companies come from US customers

“ if you build it” they won’t come

You PROBABLY have a US competitor

Your product is PROBABLY better

Your product is PROBABLY cheaper

They don’t really care (risk, barriers)

“ Touch” matters – be near your customer

Ironed out bugs

Hit the core features

OZ companies are often early adopters

Do you need to?….feedback is now global (getsatisfaction, uservoice etc)

Have you validated locally?

Presence in target market (the OEM anomaly – you think its low cost – but no free lunch) OEM Channel Enterprise Consumer High Touch Low Touch Firewall Vendors Security Vendors Per Vendor Customerisation Whiteboxing Are they blowing smoke?? No-one is incented as you!

Resellers/Integrators

Training

Mindshare

Are they Incented

Symbiotic product-line

Pilots/Integration Closing Complex Contract Negotiation Repeatable Contracts Debtors

Entering US - Team (may apply elsewhere)

Will a sales focused founder move to US? (CEO is often the best sales guy)

If not – your first Sales Hire in critical

Consider Sales/BD Contractor ( EMDG and COMET reimbursement (as an agent) )

Work LinkedIn first/SV OZ mafia

Be There – no substitute for spending time

Work some deals with them – will it work? (Bull-terrier, Hunter, Farmer?)

“ Blowing Smoke” factor?

What other gigs do they have on the side? (Integrity)

What profile do you need? (VP, Director, Outbound Sales)

Hire from your industry

Can you afford it? (SV VP USD150-180K => AUD23K/month (before EMDG)

Dial-for-Dollars – fill the pipeline

Anyone had good experience with Austrade outsource?

Anzatech, David Cannington? etc

Entering US/UK – Channel No-one will EVER sell like you!

Impedance Match

OK, so its on their pricelist – but will they sell it? (scratch the itch)

Are they selling symbiotic product?

Will they be selling to the same customer?

Does your product give them a unique differentiator?

Reseller Margin (you need to be more generous than you think)

Education/Training

Again – will they sell it? (training Surfcontrol Web ppl to sell Email Filtering)

Work some deals with them – countering objections

Cultural Differences

Taiwan and Japan were polar opposites

Is this relevant in a SaaS world? (people still buy from people but “self-service does compress sales cycle)

Lessons Mistakes

Be useful

Validate with someone other than your mum and dad

Hire well

Fund to expand, not research

Control your sales (Direct or Channel)

Measure, adjust, repeat

Market Value not Features

Not learning from mistakes

Hire too soon – Hiring “execs”

If you raise VC, you will take your eye off the fundamentals

“ Weekly Strategy Meetings”

“ Inward facing dog” http://tr.im/oDEn

Focus on Outcomes not Activity

Waiting to be discovered

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