Dj Growthtown Feb09

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Presentation at inaugural #growthtown - this is a monthly event for startups who are trying to grow/scale their business.
Focus was tip-trap in crossing the pond. Mostly a US focus.

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  • 06/08/09
  • Dj Growthtown Feb09

    1. 1. <ul><li>Going Global: some experiences from Australian startups </li></ul><ul><li>David Jones </li></ul>#GrowthTown Feb09
    2. 2. Context/History OEM Channel Enterprise Consumer EmU Tech Reach Software 90’s 2000 2003 2004 2006 2008 High Touch Low Touch NetWorth
    3. 3. Austria or Australia? david DOT jones AT gmail DOT com | skype://djinoz | Cell:+61 412 683 111 | @djinoz + 612??? Where is the “+” ? <ul><li>The reality: </li></ul><ul><li>is that 70-100% of revenues for US companies come from US customers </li></ul><ul><li>“if you build it” they won’t come </li></ul><ul><li>You PROBABLY have a US competitor </li></ul><ul><ul><li>Your product is PROBABLY better </li></ul></ul><ul><ul><li>Your product is PROBABLY cheaper </li></ul></ul><ul><ul><li>They don’t really care (risk, barriers) </li></ul></ul><ul><li>“Touch” matters </li></ul>
    4. 4. <ul><li>Ironed out bugs </li></ul><ul><li>Hit the core features </li></ul><ul><li>OZ companies are often early adopters </li></ul><ul><li>Do you need to?….feedback is now global (getsatisfaction, uservoice etc) </li></ul>Have you validated locally?
    5. 5. 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! <ul><li>Resellers/Integrators </li></ul><ul><li>Training </li></ul><ul><li>Mindshare </li></ul><ul><li>Are they Incented </li></ul><ul><li>Symbiotic product-line </li></ul>Pilots/Integration Closing Complex Contract Negotiation Repeatable Contracts Debtors
    6. 6. Entering US - Team (may apply elsewhere) <ul><li>Will a sales focused founder move to US? (CEO is often the best sales guy) </li></ul><ul><li>If not – your first Sales Hire in critical </li></ul><ul><ul><li>Consider Sales/BD Contractor ( EMDG and COMET reimbursement (as an agent) ) </li></ul></ul><ul><ul><li>Work LinkedIn first/SV OZ mafia </li></ul></ul><ul><ul><li>Be There – no substitute for spending time </li></ul></ul><ul><ul><li>Work some deals with them – will it work? (Bull-terrier, Hunter, Farmer?) </li></ul></ul><ul><ul><li>“ Blowing Smoke” factor? </li></ul></ul><ul><ul><li>What other gigs do they have on the side? (Integrity) </li></ul></ul><ul><ul><li>What profile do you need? (VP, Director, Outbound Sales) </li></ul></ul><ul><ul><li>Hire from your industry </li></ul></ul><ul><ul><li>Can you afford it? (SV VP USD150-180K => AUD23K/month (before EMDG) </li></ul></ul><ul><li>Dial-for-Dollars – fill the pipeline </li></ul><ul><li>Anyone had good experience with Austrade outsource? </li></ul><ul><li>Anzatech, David Cannington? etc </li></ul>
    7. 7. Entering US/UK – Channel Is this relevant in a SaaS world? – trying not to be “vendor 1.0” – technical products <ul><li>Impedance Match </li></ul><ul><ul><li>OK, so its on their pricelist – but will they sell it? (scratch the itch) </li></ul></ul><ul><ul><li>Are they selling symbiotic product? </li></ul></ul><ul><ul><li>Will they be selling to the same customer? </li></ul></ul><ul><ul><li>Does your product give them a unique differentiator? </li></ul></ul><ul><ul><li>No-one will EVER sell like you! </li></ul></ul><ul><ul><li>Reseller Margin (you need to be more generous than you think) </li></ul></ul><ul><li>Education/Training </li></ul><ul><ul><li>Again – will they sell it? (training Surfcontrol Web ppl to sell Email Filtering) </li></ul></ul><ul><ul><li>Work some deals with them – countering objections </li></ul></ul><ul><li>Cultural Differences </li></ul><ul><ul><li>Taiwan and Japan were polar opposites </li></ul></ul>
    8. 8. Getting Market Momentum (TMX example) <ul><li>Analysts </li></ul><ul><li>Industry </li></ul><ul><li>Forrester/Gartner/451 group </li></ul><ul><li>Javelin Strategy </li></ul><ul><li>Glenbrook Partners </li></ul><ul><li>PR/SEO/Trade-shows </li></ul><ul><li>Leading Credit Card Companies </li></ul><ul><li>Leading Credit Card Processors </li></ul><ul><li>Leading Credit Bureaus/Scoring Providers </li></ul><ul><li>High End Merchants </li></ul>Presence
    9. 9. “Born-Global” or “Flip-up” PTY LTD Commercial Ready Grant I personally prefer a data-room scanned from early on –”Investor/Acquirer Ready” Founders Investors Patents OEM/Channel contracts New Investor Due Diligence Delaware .Inc THEN Acquires 100% of PTY LTD ThreatMETRIX was a “flip-up” – the so-called “Israeli model”
    10. 10. “Born-Global” or “Flip-up” Billable Item Notes Cost (US) Cost Control <ul><li>Statuatory Incorpration </li></ul><ul><li>Simpler if “Born Global” </li></ul><ul><li>Costs are a burden until need it </li></ul><ul><li>Distraction </li></ul><ul><li>I’d prefer to defer until needed </li></ul> <ul><li>Tax Advice </li></ul><ul><li>existing shareholders </li></ul><ul><li>existing option pool </li></ul> <ul><li>AU Attorney for Company </li></ul><ul><li>liaise with US Attorney </li></ul><ul><li>Execute OZ end of flip-up </li></ul><ul><li>Advice on Commercial Ready Grant </li></ul>Get a capped quote <ul><li>US Attorney for Company </li></ul><ul><li>Flip-up/Mirroring of Articles and Shareholders Agreements (SA) </li></ul><ul><li>1 st Draft (if you can) of new SA </li></ul><ul><li>Negotiation of SA </li></ul><ul><li>Employee Contracts/PIIA </li></ul><ul><li>Establishment of BoD </li></ul>Get a capped quote – they won’t stick to it but drives behavior Pre-negotiate in the term sheet EVERYTHING not just numbers Never let a lawyer argue business terms – drive it to conclusion with the stakeholders Use a great CFO or project manager so you can keep one eye on the business The cost of Tier-1 attorney <ul><li>Attorney for Investor </li></ul><ul><li>Due Diligence </li></ul><ul><li>Negotiation of SA </li></ul><ul><li>Bad Cop </li></ul>You pay investor’s costs Pre-negotiate in the term sheet EVERYTHING not just numbers Complete Scanned Dataroom <ul><li>IP Due Diligence </li></ul><ul><li>Patent examination </li></ul><ul><li>We’ve always engaged a US Patent Attorney and pays off at this time. </li></ul><ul><li>Complete in dataroom </li></ul>Patent Authors walk it through – accelerate understanding <ul><li>Option Pool Pricing </li></ul><ul><li>Distributed transaction platform </li></ul>US Valuer quotes were a rip-off. Engaged OZ advice - OK.
    11. 11. Questions?

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