startups – Startup Daily

Bountye

As the saying goes, one man’s trash is another man’s treasure. From op shops to garage sales and second-hand markets, people have always loved trawling through preloved items for a bargain. Then eBay lets us do it online. Now, new platforms are again looking to change the way we buy and sell second hand goods. Asim Brown, former senior manager of channel and merchant solutions at eBay, is the founder of a mobile platform called Bountye, which allows users to sell and buy items within their network of friends. He said the platform began as a mission to prove that he could build a marketplace for people to buy and sell anything while making meaningful connections. “The inspiration for Bountye stemmed from my own experience. I was an early adopter, and started buying and selling pre-owned items online in the late 90s, using eBay and Craigslist,” Brown said. “I recognised that commerce has always been at the heart of communities. It was only the medium with which we exchanged goods that continues to evolve. I felt that one of the key drivers to peer-to-peer selling was the connections we make. This was in direct contrast to anonymity that prevails in the B2C world.” The target audience for the app, Brown said, are students, mums, and the person who has everything, but doesn’t have a good way to offload the things they don’t need. Users can list items by uploading photos, and can choose to make items available to everyone on Bountye or just members of a select group. Users can join and create private or public groups based on special interests or local communities. All users also must have verified profiles, complete with real names and photos, with ratings added once they begin buying and selling on the platform. Buyers and sellers can chat through in-app messaging to discuss prices and delivery options, with transactions also processed through the app through escrow. Bountye will charge a commission of 4.9 percent on each sale in all categories except for motor vehicles, where it will charge a 1 percent commission. Bountye raised $600,000 via private investors and partnerships to fund the development of the app. The pre-owned economy is worth $45 billion in Australia alone, and there are a number of apps in the market, like Oddswop and 5Mile. However, no app has really cornered the Australian market yet, which gives Bountye a shot. What’s more, Brown’s experience at eBay is already a significant advantage. Speaking of eBay, Brown believes Bountye doesn’t exactly operate in the same space as the behemoth, as the pre-owned goods market is already branching out from eBay and connecting in new ways. “Millions of users are already using Facebook Buy Sell Swap Groups, and other niche players to buy and sell. This indicates that users are looking for a better, easier, more trusting way to sell their pre-owned goods,” he said. Having just launched the app in beta, Brown said the goal over the next few months is to build the best possible product, with the team also looking to establish partnerships with companies and investors that can complement the platform.

PTEssentials

To state the obvious, FitTech is starting to become a crowded marketplace in Australia. Though the possibilities are endless when it comes to creating valuable wearable technology, for the most part Australian entrepreneurs have been focusing on developing two-sided marketplace applications that help connect users to gyms, trainers and classes. FitUsIn, Classium, Classhopper, FillMyClass, My Class Fit and AnyClass are all examples of local startups trying to tackle that problem. From the perspective of a personal trainer or fitness professional, one of the biggest challenges aside from attracting new clients to the experience they're selling, is managing the "business" side of the business and being able to make what is traditionally a per-hour style of operation into something scalable. Sydney based PT Essentials, founded by Matt Harris in partnership with BlueChilli Group, is aiming to do just that with its solution that has undergone continual development since it first came to fruition in 2012. The mobile solution was specifically designed for personal trainers and fitness professionals to help them run and manage their daily activities in their business and provide a higher level of service in managing their clients.

The roots of the idea came about when Harris left his army career and went to study a personal training course. He told Startup Daily that during that period of time, everyone talking about all the problems they experienced in that industry, especially around managing clientele. Listening to that, he set out to proactively find a solution that would aid him in his soon-to-be career, and was unable to find something that ticked every one of the boxes in terms of functionality. Harris then decided to go out and create his own system.

BlueChilli came on board as a technology partner and investor in 2013. Last year, PT Essentials received the NSW Innovations Grant which gave the company $15,000 in matched funding capital alongside $15,000 from private investors, as well as a technology partnership / investment from BlueChilli. Last week, PT Essentials received an official AVOB (Australian Defence Force Veteran Owned Business) accreditation.

Harris is the first to admit that the company has had by 'startup' standards, an extremely long R&D and BETA process before launching its software to market. However, when speaking to him, it became quite understandable that his background in the army plays a significant role in having this mindset. He told Startup Daily that he wanted to focus on the build of the product first because "in the army you don't get second chances".

The startup has begun the switch from product development to sales, marketing and users. Currently, it has about 500 users who are all actively paying for one of a number of scaled packages to use the service.

"The industry is full of part time and full time trainers," says Harris. "A lot of people do personal training on the side and all of that so it was important for us to have packages that were for those as well as a full time operator. I don't really believe in free trials, I know when I do it myself I don't really value them accordingly so our [Kickstarter package is our version of a] free trial, which has been slightly monetised so that people use it and try it and give us feedback possible because that's the fastest way we're going to grow".

PT Essentials focuses on three main aspects / pain points that are important to those in the fitness space - CRM, OH&S and distribution. It allows the creation of exercise and workout databases, taking trainers' IP from inside their heads and building it into something more concrete and tangible such as work out schedules, specific workouts, etc. The platform allows for better client communication and lead generation, allowing trainers to market to as well as send clients RSVPs and reminders to help minimise no-shows. Perhaps most importantly, it allows users to scale their operations outside of just fitting in eight or nine clients a day. The platform allows trainers to create and send online programs and workouts to their own clients complete with instructions of exercises so that the hard work can continue when they are not personally training with them. This allows the trainers using the system to create an additional income stream for their business.

This particular part of PT Essentials concept has been proven to work, with trainers like Michelle Bridges, Commando Steve and Zac Smith among many others already employing this strategy in their own operations.

At the moment, trainers are only able to create workouts that are like 'explainer cards', but Harris says as the platform develops there are going to be all types of possibilities that arise out of that part of the business, such as being able to upload video workouts and other content related IP that users want to get in front of clients that could potentially be located anywhere in the world. The other feature that is important to note is the way PT Essentials delivers personal workout and achievement data to the user that can be passed onto their clients.

"In the gyms a lot of [workout data] is kept on paper and that's the best way of showing value to your client. It's one thing to get fitter or look better but a client doesn't actually value that or see your value as a trainer until you say 'this is why you got this way, and you got this way because of me'," says Harris.

"So you need to be able to show and demonstrate your value and being able to send your client a complete workout and progress report is how we think is the easiest way to do that. All of this is done through white labelling, so all these emails as well as any trainer to client communication shows that trainer's logo and other branded assets".

In terms of addressable market size for a product like PT Essentials, there is approximately 50,000 self-employed personal trainers operating businesses at any one time in Australia. The industry which is renowned for having an extremely high attrition rate, also has a high number of new graduates that enter the space each year. Once you begin to scale a solution like this outside of Australia and into international markets, there is at least 900,000 self employed personal trainers, according to Harris.

It's worth noting that PT Essentials has a lot of competition offering similar solutions. Companies like PT Manager Pro, PT Minder, PT Transact, Positive Flo, Mind Body and Fit Clients are all worthy adversaries with considerable traction and are also highly scalable startups themselves. As such, core things like the platform's UX, UI, pricing structure, brand awareness and the strategy of focusing on converting individual sole-traders, will begin to play a major role in PT Essentials being able to successfully launch into places like the United States, United Kingdom and even Asia.

Logan Green

Two months after raising a $530 million Series E funding round, ridesharing platform Lyft has raised a further $150 million, bringing its valuation to $2.5 billion. The round was led by investor Carl Icahn, who said in a statement that ridesharing “is poised to become a fundamental component of our transport infrastructure.” “[Lyft’s] revenue growth to date has been extremely compelling, and increasing urbanization over the next five to ten years should enable the company to maintain that trajectory,” Icahn said. Lyft stated that Icahn’s involvement and the additional funds will help finance its growth plans. The company has not yet flagged Australia as an expansion market, though it must certainly be on the cards. Lyft cofounder and CEO Logan Green said in March that China and Japan were among the first countries Lyft is looking at for expansion, thanks to investment from companies in Asia such as Japanese internet services company Rakuten. The question of expansion, of course, brings up Lyft's major US competitor Uber, which was quick to expand internationally. Launched in Australia in late 2012, Uber’s market share has grown over 700 percent since January last year, despite the presence of local players in the transport space such as Ridesurfing and Ingogo, and other international apps like Moovit. Though Uber will have a significant head start when Lyft does launch in Australia, Lyft does not seem too concerned: Green said of Uber’s international presence that “Uber is struggling in a lot of these markets. It’s a story that doesn’t get told a lot but they have low single digit market share without the ability to make a dent.” He also said that Lyft is watching and learning from Uber's moves in various markets. Green followed this up by saying at a TechCrunch event that the company is primarily focused on “going deep rather than broad” with its services, suggesting Lyft wants to perfect its offerings before expanding.

Image: Lyft CEO Logan Green. Credit: Fortune.com.

BedLinenHeroes

A month after being made redundant from her job as a sales director at a creative agency, Tania Darvell fell down a set of stairs. Instead of sitting in bed feeling sorry for herself with DVDs, she decided that it was in fact the perfect time to create her own online business. Having seen a store selling bed linen for children, Darvell thought she could advance the concept and came up with Sweet Dreams Designs, an online store selling doona covers with pictures of the bodies of princesses and ballerinas on them, with the child’s head to fit in above the neck. When she fell down the stairs again six months later, Darvell again took the time to work on the idea. She then decided to move to Sydney and get a desk at Fishburners to focus on the business and find help building it. Though Sweet Dreams Designs was originally meant to be aimed at both boys and girls, Darvell found that the majority of designs had ended up being for girls, which meant she was missing out on a significant market. “I was in the shower one day and I was thinking, what's the quickest path to market? What are people passionate about? Because I had helped create television campaigns for some of the world's biggest brands, I wondered, what’s the low hanging fruit? What can I do? And I came up with the idea of getting licensing for AFL and NRL,” she said. Darvell then set about securing licensing agreements with different football codes and launched Bed Linen Heroes - essentially the same concept as Sweet Dreams Designs, with the princesses and fairies swapped for footballers. It's this idea that really took off. Though she was unable to secure an agreement with the AFL, Darvell was put in touch with the NRL by a VC following a talk at Fishburners. “After lots of perseverance, I eventually got the meeting and they loved the concept. The NRL has just been so amazing, actually. They've been really supportive and helpful as humanly possible,” Darvell said. Bed Linen Heroes currently has agreements with the NRL and Football Federation Australia, selling doonas representing different A-league and NRL clubs, and the Socceroos. Though Darvell was looking into finding investment, she decided to go lean and funded the initial development of the two stores herself, with sales from the Bed Linen Heroes product funneled back into the business. [caption id="attachment_40843" align="alignnone" width="608"]

The BedLinenHeroes product. Via bedlinenheroes.com[/caption] And on those sales: since Bed Linen Heroes launched around Christmas last year, Darvell said sales have been “phenomenal.” “It really took me by surprise, and it actually meant that I thought, oh this creates a different kind of problem to what so many of the other startups have, which is how to get sales. Mine was like how do I fulfil the sales? How do I pick and pack quick enough so we can get them out the door and make Christmas,” Darvell said. “Because it was pre-Christmas, we were driving around in a truck delivering products to retailers and to customers to make sure we made Christmas. We made it happen but it was like jumping in the deepest end of the pool. But we learnt so much and I know every aspect of my business now, which is great.” As well as through its online stores and various retailers, Bed Linen Heroes’ products are sold in NRL and A-league club stores online and at stadiums, with bigger department stores likely to come over the next few months. Expansion is also on the mind for Darvell over the next twelve months or so. In addition to securing licensing agreements with other Australian sports leagues, Darvell is keen to launch into the UK and US sports markets. However, she is wary about doing it too quickly and is trying to learn from what happens in Australia. “I've got the contacts already. Talks are happening, I know the right people. It’s now about finding the right time, and I guess the absence of me having investment means being clever about how to go about it,” she said. A well-timed expansion offers a lot of opportunities: from the NFL to the NBA, NHL, and MLB, the US sports market is huge, and there don't seem to be any stores offering the same product. But it’s not all about the stockists and spreadsheets - when asked if she had any other plans for the next few months, Darvell said, “to enjoy my business, because I’m loving what I’m doing.” Darvell also wants to connect with women who want to start their own businesses; having had a child at 16, she wants to share her story about how she managed to kick start her career and launch her own business. “I really want to get that message out to women, and be a bit of a champion for women out there who might be thinking about starting their own business.”

Image: Tania Darvell with Malcolm Turnbull at Fishburners. Via Facebook.

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Melbourne-based startup Rewardle (ASX:RXH) has announced a major commercial partnership with AirAsia that will allow Rewardle members - there are almost 1 million - to trade small business loyalty points for AirAsia flight vouchers. This could see members flying to anywhere on the AirAsia network, which includes over 100 destinations across ASEAN and beyond. Founded by Ruwan Weerasooriya, Rewardle started off as a digital update to the traditional ‘buy 9, get 1 free’ paper punch card, but has since extended its utility by adding pre-ordering functionality, mobile payments and social media integrations. There's no single title that appropriately captures what Rewardle can do, but Weerasooriya likes to think of it as a "social network that connects consumers with their favourite businesses based on transactions." “The dynamics of a social network are much better aligned to meet what today's connected consumers are looking for and this insight has shaped how we’ve gone about developing Rewardle. Our model is very similar to other social networks such as Facebook or LinkedIn, but we are based on commerce and have a point currency baked in," said Weerasooriya. Rewardle raised $4 million through its oversubscribed IPO in August last year, and finished with a market capitalisation of more than $30 million. In March, Rewardle closed a further $5 million funding in a heavily oversubscribed round, sitting at a market capitalisation of just above $39 million. Rewardle's partnership with Air Asia means that a trip to your local cafe, butcher, grocer, hairdresser, or any of the 4,000+ merchants that have signed up to Rewardle, can help earn you a flight to over 100 destinations across the world. “It’s pleasing to see our approach validated earlier than expected by a high profile, innovative brand such as AirAsia. We’re looking forward to working with Stuart and his team to implement the initial integration of AirAsia offers across the Rewardle Network in coming weeks and look forward to exploring the enormous scope to extend this relationship over time,” said Weerasooriya. In the face of criticism following Rewardle's IPO announcement, Weerasooriya told Startup Daily that behind the scenes, Rewardle is essentially building "an open source style rewards platform – like an open source FlyBuys. Similar to how Qantas sells $1.3 billion worth of points per annum to brands who then give out the points as rewards or incentives, we see an opportunity to do a hyperlocal version of that with Rewardle points." Last year, Virgin Australia sold 35 percent of their Velocity Frequent Flyer programme to one of Asia Pacific’s largest investment firms and fund managers Affinity Equity Partners, valuing the programme at an enterprise value of $960 million. So if the market is worth, say, at least $1 billion (excluding Qantas from the equation), and Rewardle is able to take a 10 percent portion of that market by targeting small businesses, then that’s a $100 million market cap. This may seem bold, but Weerasooriya believes there’s a massive opportunity to sell points as currency and there's huge value in opening that opportunity up to small businesses. Taking a sizeable chunk of the airline rewards market is no easy feat. In Australia, this space is dominated by Virgin Velocity and Qantas Frequent Flyer programs. Merchants usually involved in assisting these programs are large players like Coles and Woolworths. What Rewardle is doing is enabling small local merchants to be part of that action now and making it even more attractive for customers to spend money with small businesses across Australia. Weerasooriya said, “While airline points have become an established loyalty currency, in building Rewardle we saw a huge opportunity to develop a local equivalent where points could be earned and rewards redeemed from the amazing local businesses that service our local communities.” The way that Rewardle works is: merchants place a customer facing Rewardle tablet on their counter that acts as a kiosk. Customers check-in on the tablet using a card or the Rewardle smartphone app to collect points and redeem rewards during daily transactions at their favourite places. When AirAsia's offers are integrated into Rewardle, customers will be able to redeem flight rewards and even purchase flights straight through Rewardle. For example, you've checked in via Rewardle at a local cafe, a message might pop up saying something along the lines of "A flight to X is available for $99. Offer lasts while you're in the store." In the future, should customers take advantage of that offer and book their flights on the spot, Rewardle could take a clip of the ticket given it has similar payment technology baked in as Uber which allows customers to vault their credit card details in the Rewardle app for one tap payments. Whilst some critics jumped to conclusions last year, saying Rewardle’s subscription model doesn’t pave a profitable pathway, its commercial partnership with AirAsia suggests otherwise. Stuart Myerscough, AirAsia's Head of Commercial Australia and New Zealand, acknowledged that the partnership is mutually-beneficial. By complementing local rewards with AirAsia sponsored flight voucher rewards, AirAsia is helping boost Rewardle’s appeal for merchants and members. At the same time, the partnership is an opportunity for AirAsia to tap into the Australian market and boost flight sales. “As a challenger brand competing with the larger budgets of incumbent rivals we’re always on the lookout for innovative ways to secure cut through for the AirAsia brand. With Rewardle’s accelerating growth trajectory and increasing profile, we saw an opportunity to move early on capturing a very strategic opportunity that places the AirAsia brand at the heart of local Australian communities," said Myerscough. “Rewardle has amassed a merchant footprint that is more than four times that of McDonalds and their membership growth is outpacing Virgin’s Velocity program without a cent being spent on advertising. With stats like this they certainly got our attention.” According to Weerasooriya, who carries a strong track record of founding, building and selling businesses in various industries including professional services, ISP and media, Rewardle’s growth is powered by a carefully planned network effect built into the business model. The “network effect” is the effect that one user of a product or service has on the value of that product to other people. Over time, as more people join, the network becomes more valuable, as does the product. Disclosure: Ruwan Weerasooriya is on the advisory board of Shoe String Media Group, which owns Startup Daily.

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There was an interesting article in The Economist recently stating that everyone living in places like Asia are going to university. In the grand scheme of things, they pretty much are. In a way, education, especially across many parts of Asia is all about improving circumstance. The number one priority is always education in most Asian countries and quite often the second for many is moving from the country they're in.

Ruppells Griffon

If you’ve ever had to do anything around your property that needed to go through your local Council for approval, you know it’s a complicated, time consuming process: you have to register the project with the Council, alert your neighbours, and give them time to consider the development and give feedback. Geospatial analytics startup Ruppells Griffon has launched CommunityNotes, a platform to help streamline this process for developers. The web-based platform allows both developers to provide visualisations and other information about a proposed development, and community stakeholders to leave feedback and engage in conversations with each other about it. Ana Ouriques, founder of Ruppells Griffon, said the app was created in partnership with community consultants to solve some of the major problems they were constantly coming up against. “As with many technology innovations, we found an existing process that was inefficient in many respects. It took too long, it cost too much, and there was no facility for information exchange within the relevant community,” she said. “[CommunityNotes] saves time, and also increases engagement level, as it reduces all the friction in the process. Stakeholders can easily add their feedback on the project at any time, and from any device.” [caption id="attachment_40957" align="alignnone" width="1285"]

An example of a development on CommunityNotes[/caption] The traditional community engagement process usually sees information about developments exhibited in Council offices, and discussions take place in community forums and meetings. Essentially, CommunityNotes brings these two processes together. Ruppells Griffon will work with its council and developer clients to help them customise the app for specific development proposals. Residents will be able to access the app from any browser and add comments and feedback, as well as participate in conversations with other residents. The project owners can then get access to real-time monitoring and analytics to see how the community is reacting. Ouriques believes that the conversation aspect is one of the most significant features in the app. “To date this level of transparency hasn’t been possible using the traditional community engagement model,” Ouriques said. Though CommunityNotes provides a much-needed update to this model, there is the question of how to get residents to use the platform; after all, getting their feedback is the whole point. It must also be considered that older residents - who are often most interested in community developments - may not be internet users at all. The app is available to councils and developers through a monthly subscription fee, meaning clients can pay to use the app only for specific projects, if needed. With the app launched earlier this month at CeBIT, Ouriques said it has potential to be used in a range of industries including infrastructure, environment, utilities, and transport. “There is huge potential for this to be used with companies that are in building and development. We have designed this app to be as broad as possible – it can be used by anyone that needs to get feedback from stakeholders on a land-based project,” she said. Ruppells Griffon has also launched a free version of the app called YourSay, which lets users share information about their neighbourhoods, such as traffic alerts, crime news, and community issues. Ouriques said, “YourSay uses the same underlying technology as CommunityNotes, making it the perfect platform for citizens that want to participate in making their neighbourhoods as safe and family-friendly as possible.” “We’re expecting this to be the ‘gateway drug’ that pulls people over into the paid service when they need more control and customisation for specific projects.”

Weirdly

Based out of Auckland, New Zealand, HR startup Weirdly is tackling one of the biggest recruitment challenges that exists today: company culture fit. The startup was founded by Dale Clareburt, Simon Martin, Keren Phillips and Hayden Raw, who have over 20 years of experience in recruitment and human resources combined. Together, they've created proprietary technology that helps companies recruit people into an organisation based on how likely they are to love a business, how in-line they are with a company's core values as well as how likely they are to find their future work fulfilling. Everything is based around the creation of a totally customisable quiz. When job applicants apply for a role on a job search platform or directly with a company, they are presented with a quiz as part of the application process. Weirdly then filters and manages all applicants via a client dashboard. The candidates that align with a company's values and culture automatically appear at the top of the list, saving recruiters and line managers time and energy sifting through endless CVs and conducting interview after interview.

"We assist in that step based on what you as a company are looking for. So you determine what attributes, character and personalities you're looking for and then Weirdly's algorithm uses those as a baseline upon which it measures everyone else," said Phillips.

The platform takes the attributes that users outline and build into quiz questions, then measures how well candidates are at displaying those attributes in their answers to the questions. Ultimately, it gives the user numerical insights as to whether someone fits into their business. For example, it would say something like 'X fits into your business 20% and Y fits into your business 87%'.

Although Weirdly is focused on growing via sales, the team did take on some seed funding invested by the Punakaiki Fund, a firm that invests in early stage New Zealand startups, to help them move from having a beta product into creating a fully formed and scalable piece of software. Although it is not immediately on the cards, Phillips told Startup Daily that at some point in the future a Series A round may be pursued as they begin to focus on the next wave of scaling the company.

Weirdly has had a global focus from day one and has managed to attract clients not just locally in New Zealand but across Australia, the United States and Europe, a lot of this expansion has been the result of getting in front of the New Zealand branches of international companies. Brands like Xero, Jucy Rentals, Vend, Allianz and Spark (NZ Telco) are all using the platform now as part of their recruitment processes.

There are two revenue models in the way Weirdly is structured. The first is targeted at bigger enterprise level companies that have robust recruitment processes in place.

"They have people driving those systems who are very very good at what they do, so they're working with in house or external recruiters, so they really know what they're doing right," said Phillips. "The way that we work with them is by a plugging into their existing processes and helping them filter the applicants that they have coming into jobs against cultural measures. They all have systems that are really good for filtering people against hard skill measures, like when you went to university and what job you did last time and all of those kind of metrics."

What Weirdly gives those clients is the components that are cultural fitters. At the other end of the scale, the platform also provides a self-service product for people to buy off the shelf via subscription in the same way that you would any other SaaS product like Xero. This product lets users set up the quiz themselves and integrate with their own platforms including job boards and social media pages.

"The whole premise is around helping these smaller sized operations, who are time poor and often not as experienced in recruitment build a better quality candidate shortlist faster," said Phillips.

02. Pic of founding team

It was announced yesterday that Lodgify, a startup that allows users to create their own vacation rental sites closed a €600,000 (AU$844,646) seed round led by angel investor Chris Hitchen, who also happens to be a venture partner at Square Peg Capital's office in Germany, as well as Howzat Partners and Venrex Investment Management. Although based in Europe, the startup has some pretty strong ties to Australia with Australian angel investors such Finn Kelly (Wealth Enhancers) and Andrew Menzies (SellMyCastle) joining other prominent investors like Roland Zeller (Travel.ch) and Kilian Thalhammer (former MD of PAYMILL) on the deal. Lodgify was cofounded by Gabriele and Marco De Gregorio, Dennis Klett and Naveen Sharma in 2013 and is based out of Spain. The company is part of the Seedcamp alumni which is one of Europe's leading accelerator and mentoring programmes. It is a very interesting platform that plays in the vacation space; it could be described as a B2B solution for small operators and individuals that wish to commercialise their own properties. Users of the platform can easily create their own website for their properties and manage their reservations in real-time without ever having to pay commission. Lodgify offers scalable subscription plans based on a monthly fee for both vacation rental owners and managers with one to 500+ properties. The service includes mobile friendly website templates, an online booking engine, reservation system and channel manager. Basically the software that the Lodgify team has created enables users to run their small accommodation-for-hire business ventures at the same level of professionalism and scale that a major hotel chain. “Lodgify’s mission is to empower vacation rental operators to grow their business through technology,” says Klett. “Our product pipeline is filled with innovative features and new website templates tailored to the modern needs of hospitality businesses. With this funding we can aggressively expand our product development operations.” As established, the funds will be used to further enhance the company's website-building software; it will go towards expanding the product team and creating additional features on the site that will be unveiled at a later date. Lead investor Chris Hitchen as well as other investors involved in the round said they have been very impressed with the Lodgify team. Hitchen added, "We are very impressed by Lodgify’s technology-focused approach to tackling the vacation rental industry's challenge to generate more direct bookings. Their intuitive user interface and set of innovative software tools positions them strongly in a lucrative and growing market.” Those are powerful words coming from Hitchen who is developing a track record for backing successful startups including Australian technology companies like GetPrice, SellMyCastle, CoinJar and AudienceTV. He is right though. Lodgify is a startup that is capable of scaling; and in comparison to its competitors such as the well funded Y Combinator alumni company MyVR and other startups like Planyo and Checkfront, the UI/UX is pretty above average. Although there are opportunities to move beyond targeting just vacation rentals and also allow businesses like small independent hotels to utilise the platform, Klett has said that the team has a clear focus on what they are working on right now. “Our focus is on vacation rentals, however, we are receiving a lot of interest from hoteliers who would like to challenge the dominant position of Online Travel Agencies and regain more control of their bookings,” says Klett. “They see the potential of our software helping them to drive direct booking and build their own brand.”

Jeremy Liddle

According to Jeremy Liddle, cofounder of RioLife and Director at the Entrepreneurs Network for Young Australians (ENYA), investors say that nine out of 10 businesses that approach them are not ready for investment: their business model isn’t sound, they haven’t done all of their research, or they don’t know how to produce an investor deck or information memorandum. That’s why Liddle has launched CapitalPitch. Essentially, this new venture is an equity investment platform that doesn’t just allow startups to raise money, but also educates them on how to be investor ready. “Being investor ready for a seed round is very different to being ready for a Series A round. You can raise money from angel investors without an information memorandum, you can raise money with just an idea; you can raise money on a business that’s pre-revenue. But it’s very difficult to do that with a Series A,” Liddle said. “There are a whole lot of businesses starting up right now...so the competition is getting extremely tough. You have to be awesome when you approach investors. If you go out and you’re underprepared or semi-prepared, then you’ll burn a lot of bridges. What we can do is help businesses look better than the other businesses investors see.” The inspiration for CapitalPitch came from Liddle’s previous experience in not only running his own businesses, but also in helping other businesses. Liddle launched health food company RioLife in 2005 with co-founders Andrew Cameron and Andrew Maciver, holding the role of CEO for seven years. In that time, the company tried to raise a $1 million Series A round, spending between $15,000 to $20,000 in the process on financial modelling, production documents, an advisory board, and legal fees. Ultimately, the company wasn’t able to raise the Series A, with competitors also emerging along the way, making it difficult for RioLife to continue in its growth trajectory. Prior to that, RioLife had tripled its revenue growth year on year for the first three years, and in 2010 won the SAGE award for fastest growing small business. CapitalPitch works through a six step process. The first step is an eValuation, where startups are required to answer questions around revenue, IP, partnerships, and experience, after which they receive a report that includes an estimated valuation (based on the startup's location), how they can improve, and how an investor would view them. Step two is an investor communication package that gives startups all the frameworks and templates they need to guide them on how to build a suite of investor communications, such as a pitch deck. Startups can choose to either complete this process themselves for $27 a week, or be coached through it for $197 a week. These coaches include Liddle himself, as well as a network of existing advisors and investors in CapitalPitch. This network will grow in time. Step three sees the startup submit all their documents online to CapitalPitch, who will then check if the documents are up to standard and assign the startup a personal advisor in step four. Though Liddle was not able to reveal any names, he said the advisors come from top tier firms as well as from boutique industries, with all experienced in coaching, mentoring, and angel investing. The advisors will help startups in making sure all their documentation is ready for presentation to investors. The advisor will then lead and syndicate the raise. Step five looks to take care of all the legal processes, like shareholder agreements, subscription agreements, and term sheets. CapitalPitch has sought to speed up this process by creating investor-vetted customisable agreements and due diligence documents. Liddle acknowledged that investor-vetted documents skew the balance of power towards the investor. However, he said that CapitalPitch’s seeks to educate startups in the legal processes behind Series A funding so they can approach investors with greater confidence. “Currently, investors have all the power: they produce their own term sheet and force changes into shareholders agreements. Startups are at the mercy of investors, and that’s the problem we’re trying to solve,” said Liddle. “We give the businesses a little bit of upfront learning about the type of agreements investors will actually agree to. We don’t want them to learn that by failing.” The final step is the capital raise, where founders pitch their startups to CapitalPitch’s global network of sophisticated investors. Liddle said the time needed to get through the steps will vary for each startup, but believes it’s generally three months before they are investor ready as it takes time to form a board of directors who will engage with and bring value to the startup. The capital raise process itself can then take a further three months. Essentially, among other things, incubators and accelerators also help startups become investor-ready. Liddle said CapitalPitch is not looking to compete with these existing programs, but rather be an additional resource for startups. “We’re not looking to disrupt anybody; it’s an enabling technology, so if businesses coming out of incubators and accelerators haven’t immediately raised the money they need, they can come to us,” Liddle said. “Often, the businesses that do graduate from these programs do raise money, but what happens to the 90 to 95 percent of businesses that incubators turn away or don't take on? And what happens to the percentage of businesses that come out of there and don't raise money immediately? They can come and work with us and we can help them too.” The development of CapitalPitch has been funded by local angel investors, a private bank in New Zealand, and several G20 Young Entrepreneurs Alliance leaders around the world, including those from Canada, US, and Brazil. CapitalPitch has also implemented an affiliate program, where anyone with a strong network of entrepreneurs can earn 20 percent on revenue based on referrals they have sent. Liddle said a number of G20 YEA leaders and their organisations will be partnering with CapitalPitch. The platform was created with a global mindset; Liddle said there has been interest in the platform from 20 countries around the world. Around 140 businesses have so far completed the eValuation questionnaire and received their reports. According to Liddle, steps one and two of the CapitalPitch process is immediately globally scalable. He acknowledged, though, that language, culture, and pricing will be a challenge for the latter steps. Liddle said he hopes to get every startup in Australia completing at least the eValuation, as it’s free, though his bigger vision goal is to close Series A rounds for startups. “Convincing more investors that they should be investing more in startups is the next step. Once we've got a group of amazing businesses that look world class, we need to then go and convince more investors to get behind them.”

Image credit: Business Insider.

99interns

For cash-strapped startups, bringing an intern on board can help, but it’s important to make sure they will actually be getting useful, relevant work experience rather than simply doing the boring admin tasks no one on the payroll wants to do. 99interns, the Sydney-based startup which helps connect startups with interns, has created a guide to help startups make sure they’re both on the right side of employment law and giving interns useful experience. Dave Michayluk, cofounder of 99interns, said the company has found there are many misconceptions about internships in the startup community. “When we were testing our business model by interviewing startups, founders kept telling us that unpaid interns were illegal. We know this isn’t true but the stories about lawsuits scared a lot of startups,” Michayluk said. The company compiled the guide after meeting with Fair Work Australia to understand the legal requirements of hiring an intern. The guide, titled ‘Everything a startup needs to know about interns and internships’, talks startups through the types of tasks that can be assigned to interns, whether an internship should be unpaid or paid, the minimum wage for a paid internship, how to write a job listing, and whether work insurance is needed. To stay within the law with an unpaid intern, startups must ensure the internship is a worthwhile learning experience, doesn't last more than 12 weeks, and that an internship agreement is signed. Startups also need to know that the intern cannot replace an employee. Further, while an intern can work only on social media for the length of their internship, for example, they cannot be responsible for, or in charge, of one aspect of the business - they should always be shadowing and learning from someone. Yvonne Lee, cofounder of 99interns, said that the most important thing for startups to remember is that unpaid interns can’t be considered free labour. “Having an unpaid intern is a commitment to provide a learning environment for the intern so that they gain experience. The internship has to be set up in a way that benefits the intern and in Australia it cannot be an employment relationship,” Lee said. As a rule, to quickly determine whether they have entered into an employee arrangement rather than an internship arrangement with someone, startups should consider:

Purpose of the arrangement: Was it to provide work experience to the person or was it to get the person to do work to assist with the business outputs and productivity?
Length of time: Generally, the longer the period of placement, the more likely the person is an employee
The person’s obligations in the workplace: Although the person may do some productive activities during a placement, they are less likely to be considered an employee if there is no expectation or requirement of productivity in the workplace
Who benefits from the arrangement? The main benefit of a genuine work placement or internship should flow to the person doing the placement. If a business is gaining a significant benefit as a result of engaging the person, this may indicate an employment relationship has been formed. Unpaid work experience programs are less likely to involve employment if they are primarily observational
Was the placement entered into through a university or vocational training organisation program? If so, then it is unlikely that an employment relationship exists.

Redbubble

Melbourne-based online art marketplace Redbubble has raised $15.5 million in its latest capital raise, with the company looking to use the funds to push its international expansion. Investors in the oversubscribed funding round include Melbourne's Acorn Capital and London firm Piton Capital. Current high-worth investors in the company include Simon Baker, Michael Birch, and Stan Chudnovsky. Martin Hosking, founder and CEO of Redbubble, said, "We are delighted to have closed the round with such strong institutional investors. The funds will allow us to service the growing consumer wave for personally relevant and creative products and accelerate our product rollout and plans for further international expansion.” Greg Lockwood of Piton Capital will be joining the company's board of directors, sitting alongside fellow new appointee Chris Nunn, Teresa Engelhard, Stephanie Tilenius, chairman Richard Cawsey, and Martin Hosking. Redbubble was advised by EM Advisory and Allens Linklaters on this raising. Founded in 2007, artists have earned over $30 million through Redbubble. The site now hosts 14 million images that can be printed on various products like shirts, mugs, and other accessories, with the company stating that more than 1.2 million customers shopped on the site last year and over 60,000 artists made sales. Over 90 percent of these sales are coming from outside Australia, with Redbubble's print-on-demand technology enabling products to be printed individually for each consumer as they order. This latest capital raise comes as Redbubble says it expects to track over $100 million in sales in 2015. The company is also moving into new segments, having recently launched its first women's street style fashion collection. With rumours of an IPO having surrounded the startup for several years now, the rapid growth of Redbubble has come with the rise of similar platforms like Etsy. Mainstream is so out right now, with consumers increasingly looking to spend their hard-earned cash on bespoke and one of a kind designs that you can't find mass-produced in stores. These platforms come in all shapes and sizes, from German craft marketplace Dewanda, Arizona-based ArtFire, and Australian custom furniture site Handkrafted to Aftcra, which focuses on American artists. As consumers have flocked to these platforms, so have investors: Etsy has to date raised almost $100 million, while Dewanda has raised over $5 million.

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Daze of Disruption is the latest in the string of “disruption” events to hit Australia in the last few months. With an inaugural run over last Monday and Tuesday, Daze of Disruption eagerly opened it’s doors at the Surry Hills Belvoir Street Theatre. As many of us have hit peak event fatigue, the industry is left to wonder how to tell these events apart. Unfortunately, Daze of Disruption does not make a good case for itself. After the long series of keynotes and panels, it was hard to determine whether we were meant to feel threatened, encouraged, or any sense of urgency around this mystical “disruption". Daze of Disruption, at least in this initial run, went down as its own cautionary tale: have we jumped the disruption event shark? Probably. However, it is hard to blame the Daze of Disruption team for this bumpy first round. As someone who is tasked with putting together an “innovation event”, I greatly empathise with the challenges of getting the right pieces at the right time. Sponsors are few and far between; and often, the money is spent before you ask for it. The mountain to climb is steep even if the path is well-treaded. Not my kind of circus The biggest disconnection about these “industry events” is that they are in the experience business. Ultimately, they are in the content business, delivering a story that the audience will internalise and take with them. TEDxSydney has done this exemplarily over the last five years. Content meetings for industry events seem to launch from the wrong foot form the start. Instead of starting with an anchoring message or a clear point of view, these meetings start with “who can we get?” and work backwards from there. As a result, events like these are less Cirque du Soleil and more Ringling Brothers. Instead of a cohesive thematic narrative, I had the impression that we were watching distinctive individual acts being introduced by a skilful ringmaster: “And now, the tigers! ... And now, the clowns! ... And now, the trapeze artists!” I could have watched all the keynotes individually on YouTube and had the same experience. Having said all that, the quality of the speakers was unimpeachable. Jeremy Knibbs and his team have done a stellar job in securing a stellar lineup, particularly considering the breadth of events that are snapping up speakers. The major takeaways, though disjointed, were worth the price of admission. Here are my three favourites in no particular order: First Dates - John Batistich (Westfield) A breath of fresh air, the always dapper John Batistich from Westfield let us in on a personal note: he had his first date with his wife at the Belvoir St Theatre. It was a short, funny tale of self-deprecating first-date jitters with a looming, but welcome, happy ending. Having observed John at meetings, he is a commanding presence without the trappings of spectacle. The story was quick, touching, relevant and left you wanting more. It connected with the audience as I can assume, we have all been on first dates and can relate to the experience. It was easy to project our own experiences on to his. This was a remarkable example of how to quickly build a bridge across to your audience, without the need of artifice or fancy ploys. As he wrapped up his 30 second tale, we were all hooked - leaning in to hear the rest. We were emotionally primed for the Westfield infomercial that followed and I could not have been more delighted to hear it! I can only hope speakers would take a page from John’s book. Let’s get out of this bubble - Richard Webb (StartMesh) Do you know that there is a direct correlation between housing prices and how innovative a city is? I didn’t know that either, which is especially embarrassing since it was my South Bondi cofounder, StartMesh’s Richard Webb, who spoke about it from the Daze of Disruption stage. Apparently there are studies that show that a city with high real estate pricing will automatically push down unpredictable risks in favour of trusted and well-traveled paths. So next time you wonder why the hell your boss, client, colleague, manager or partner doesn’t want to explore new ways of doing things, it’s because he or she doesn’t want to lose their house. Sydney’s real estate prices are at an all-time high, which means our innovation roadmap will stall for some time to come. Scary? You bet - particularly since there seems to be no end in sight for this bubble. The only upside of it will be the release of true innovation once it bursts. "What Google saves on taxes, they spend on shoes.” I wish I could say that this was my line but it belongs to the Daze of Disruption MC. I imagine the lovely speaker from Google must have the most covetable Pinterest board in the business. If you, like me, thought that Google was in the technology business, this talk was a rude awakening. Google is the new 007, an institutional spy with license to kill. They cannot wait to tell us how much fun they are having looking into our lives and, further even, into our intent. The speaker Lucinda Barlow asked us to take out our phones to teach us a little trick, though she warned us she only knew how to do it in Chrome, which was very convenient brand placement! The trick was showing us how to access our browsing history, which apparently they read as if it were part of our DNA strands. Google knows what we want, what we need, our fears and hopes, our aspirations and our intents. What Lucinda finds fun and exciting, I found bone-chilling - especially considering there is no way for us to protect ourselves from it. Google owns our browsing experience as much as the ATO owns our government dollars. I really wish someone would put those two together. When all is said and done, Daze of Disruption only suffers from the symptoms of a wider epidemic of industry events. If we can crack the nut of making these events more interactive and purposeful, we can get sponsors to join in. I’m excited to disrupt this space! Let’s get on it, Australia!

featured image: Daze of Disruption Conference | Credit: B&T Magazine

Nicollette Maury

According to a recent study conducted by financial applications company Intuit, Australian entrepreneurs rank highly when it comes to qualities like having ideas, being passionate, having great skill sets and fearlessness to start a business, but they severely lack core financial knowledge that would assist them in becoming a long-term success. The Intuit Financial Fitness Startup Study that was launched last week, was conducted by Galaxy research and surveyed 400 startups across Australia to find out how much they knew about managing their business finances. The survey was made up of a 10-question quiz all around key accounting concepts like the role of a balance sheet, accruals and depreciation as well as other core business techniques like how to improve cashflow. "The purpose of the survey was to understand how well they understood their particular business finances, what tools they were using to help manage them and where they thought they needed some help," says Nicolette Maury, Managing Director of Intuit Australia. "The results really revealed quite a critical knowledge gap across startups and the most impactful statistic there was the majority of these startup owners didn't pass the basic financial knowledge test and 1 in 10 of them couldn't answer any of the questions correctly ... There's a serious knowledge gap with these startups that obviously have started a business based on a passion and seen a business opportunity but there's a real risk with them not being able to build a sustainable business simply because they don't have some of this basic financial fitness". There were some pretty alarming insights amongst the data. According to the survey, men were deemed more financially fit than women; and from a generational perspective, Gen Y proved to be the least financially savvy with only 26% of those surveyed actually passing the quiz. Perhaps more alarming is that 65% of those canvassed could not explain the role of a balance sheet and 70% were unable to define accruals. In addition, only 64% of startups knew that collecting receivables on time improves the short-term cashflow of a company. It is worth mentioning that, although Intuit estimates there are 500,000 people in Australia involved in startup activities at any one time and that 25% of startups close their doors in the first year, the survey was not specifically targeting "startups". It was targeting new businesses. The numbers around startups shutting down within the first year are actually closer to 80% and there is a much smaller pool of locals playing in the area of highly scalable business ventures than 500,000. Having said that, Intuit does understand the "startup" space, having been one and acquired high growth technology businesses itself. The company is also a supporter of the Startup Weekend movement, and is in a position to help startups put in place actionable insights to have better financial foundations for their companies. "There are three areas that we can help. Firstly is obviously through our cloud accounting software. It is a tool that these businesses can use, not just to help them manage their finances with limited knowledge in a really intuitive way but also to help educate them on what's important for them to build a successful business and the research showed that only 9% of these startups currently use a cloud based accounting software. So there's a real opportunity there with Quickbook online as tools to better help them manage their finances," said Maury. "Secondly we worked very closely with accounting professions and there's a very strong role for the accounting profession to play in the success of Aussie startups. This is particularly around being that trusted advisor and ensure that they're building a strong financial foundation but also to help them plan ahead and learn to build a more successful business. And finally our longer term plan is to run some financial fitness bootcamps where the national sponsor is Startup Weekend Australia and so we're working with them on ways to educate the startup community on some these basic financial knowledge areas to help them get some of this right". Numbers, and more importantly, knowing what your numbers are, plays a critical role in any company, startup or otherwise. The biggest challenge for startups is finding the right people to bounce ideas off - who will help keep them in check from a financial perspective through mentoring and fiscal guidance. This is something that Intuit says will be a focus for the company as it enhances the role it plays in the Startup Weekend events throughout Australia.

Suzi Devine - Winephoria

Though Australia’s wine regions are world renowned, the stereotype of a country full of beer drinkers persists - perhaps because wine is so famously difficult to understand and buy. As a result, startups like Adelaide’s Vinomofo and Sydney’s The Wine Gallery have emerged to help consumers better understand what it is they want from wine. New startup Winephoria proposes to do the same, but rather than matching wines to occasions or food, it helps customers pick wines based on their personality. Founder Suzi Devine said the idea for the store came from her own experiences going to the bottle shop and feeling overwhelmed by the selection of wines. “No one was helping me purchase good quality wine with a great customer experience. There was a definite gap in the market for someone to deliver on quality wine from family-owned Australian producers, with a sure fire guarantee that if I didn’t like it they would fix it,” Devine said. So she set upon building Winephoria, an ecommerce store working with small Australian wine producers to help consumers buy boutique local wines. “The excitement of finding the unexpected and the desire to explore great wines, and providing these wonderful family owned businesses with the recognition and market exposure they deserve drives the Winephoria ethos. There are so many brands that cannot afford to compete in the big chains, yet are wonderful quality wines that deserve people to taste and love them,” Devine said. She then came up with an interesting way to get consumers to choose wines: personality matching. “The wish list was that it had to be fun and engaging for people, but also deliver something with meaning and statistics behind it. While the positioning is fun and engaging, the outcome is serious.” Devine worked with psychologist Dr Timothy Sharp - or Dr Happy of The Happiness Institute - on the psychological elements of the app. The app works by having users answer a series of lifestyle and preference questions, and then tells them their ‘wine personality.’ Users are then shown a selection of wines fitting the personality. “For example, Bold Spice is a gentleman that prefers strong reds, whereas the Fruity Vixen is a woman who prefers fruity white wines. It takes the industry jargon and complication out of wine and allows people to understand their preferences by delivering suggestions around what they like,” Devine said. The app asks users for things like their favourite food, whether or not they would consider themselves a risk taker, how often they drink, whether they prefer red, white, or sparkling wines, and where they would most enjoy drinking a glass of wine. It’s definitely an interesting, novelty concept, and perhaps fairly accurate, too: I had a go on the app and it matched me with the types of wines I enjoy. Now, there are two ways the personality matching app could go: most wine connoisseurs recommend wines based on the meals they will be consumed with. On the other hand, many people will always stick to the one or two kinds of wines they know they like, and in this sense, many do have a ‘wine personality.’ However, Winephoria also offers a Wine Concierge service, with staff on call to talk users through wine selections if they do want more of a traditional customer service/discovery experience. There is a 100 percent money back guarantee if customers are unhappy. Though the startup faces competition from platforms like the aforementioned Vinomofo, now well established, and The Wine Gallery, Devine quit her full time job to focus on Winephoria, funding its development with her savings. “I see Winephoria doing what it does best and keeping true to our proposition. We are not taking our eyes off our goals to react to competitors in the marketplace. If we continue to deliver outstanding customer service and a quality product, the rest will unfold correctly,” Devine said. “We believe that our wine concierge service, money back guarantee, and our fun approach to discovering new wines is more than enough to set us apart from what competitors may be offering.” Devine said the company is focused on delivering on its brand promise to customers, and becoming the partner of choice for wine producers and lovers alike.

The Qwilr team

Sydney based startup Qwilr, founded by Mark Tanner and Dylan Baskind, announced last week that it has raised $500,000 in a seed round led by Sydney Seed Fund and Macdoch Ventures. There were a number of private angel investors that went in on the deal as well bringing the total amount of seed funds raised by the company to $600,000 after a $100,000 raise last year. Qwilr is a platform that hopes to transform the way people interact with documents. It does this by completely reimagining what documents are, relative to the time we now live in - a digital world. Qwilr makes it easy for users to turn documents that would otherwise look static into web pages that are data rich and interactive. As the Qwilr team describes it, the platform could look something like what you would get if website building application Squarespace and media platform Medium might look like if they had a baby. "The reason Qwilr exists, is because we want to make it as easy as possible to create web-pages as you would to make a document" said Tanner. "The basic idea behind it is that the web allows you to do so much cool stuff that traditional documents don't let you do. Documents are fundamentally unintelligent, they don't have any ability to run software or do anything interesting. The web is the total opposite of that". It's this line of thinking that makes Qwilr a truly innovative idea. For those familiar with creating proposals, presentations and documents, it is often hard to convey a message in its entirety without having to use multiple platforms. For instance, if you were wanting to send a client a sales proposal that had multiple tiers of pricing and wanted that client to be able to interact with the document to see what they get for each different level in a fun creative way, Qwilr would not only allow you to do that, but you could even add a video or integrate ROI statistics to display alongside the information to match the client's interactions with the document. Essentially, Qwilr allows businesses to do "cool stuff" with their documents and present them as self-hosted websites. In my opinion it sits at a cross section between three applications -Google Docs, Canva and Squarespace - and is a perfect tool allowing the creation of customisable, sharable, design centric and trackable documentation. The company has been embraced by the tech and startup space with thousands of users both in Australia and overseas like in the United States and Europe. Tanner told Startup Daily that there has been significant uptake in Asia as well, which has created some unexpected challenges and opportunities in terms of language capability within the platform. Perhaps the biggest challenge that Qwilr will face as it begins to scale is convincing larger companies and medium sized businesses that switching from their current systems to a new web-based solution will be worth it. "The entire focus for this round is around how does Qwilr communicate what we are doing with companies outside of the tech and startup space," says Tanner. "Currently we have many startups, freelancers and small to medium digital agencies as well as creative professionals as early adopters, and with this current round investing in the technology will only make the platform more powerful." This kind of investment will be needed so that companies will come on board and integrate Qwilr as part of their normal document creation processes for things like proposals and presentations. Although the platform currently has a brilliant UI / UX and is intuitive to use, it is not necessarily intuitive for teams. This, according Tanner, is what the company is currently concentrating on creating: a platform that is as intuitive for small and large teams as it is for individuals. Although you get such things as your own sub domain as a company, what we can expect to see from Qwilr over the coming months is a solution that gives companies even greater brand control in much the same way platforms like Google for work does. “Some supposed innovation out there is not much more than a shareable A4 document," says Tanner. "The future of content is in web pages. Not as things we print out and put in landfill, but as beautiful pages we view on smartphones, tablets and desktops.”

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Started in the early 2000s as a community on the LiveJournal blogging platform, 500px has become one of the most popular places in the internet to store professional and amateur photos, with more than 50 million images in its archives. [Source: TheNextWeb]

image source: Business Financial Post

Spotcap

Spotcap, a Rocket Internet-backed startup offering microloans to small and medium businesses, has launched in Australia. The startup, founded by Toby Triebel and Jens Woloszczak, was established in Madrid in September last year, and launched in the Netherlands earlier this year. Lachlan Heussler, managing director of Spotcap Australia, said the company chose Australia as its third expansion market for two main reasons. “There's a high penetration of online activity in Australia, whether it be online banking or the use of cloud products, and there's also a large unmet demand for funding,” Heussler said. The startup hopes to open up credit availability to clients that traditionally would not have been able to get credit before. “Small business lending traditionally is a difficult thing, because the banks often lend secured. They’re very reticent to offer unsecured lending, and we think we can sort a gap there,” Heussler said. Technically, rather than loans, Spotcap offers SMBs credit lines, making available to them amounts varying from $1,000 up to $100,000, from which they can then draw a loan. Startups apply for a credit line by providing Spotcap access to their cloud accounting software or their ecommerce store, for example, after which Spotcap’s algorithm will determine whether the business has been approved for a credit line and its terms. The businesses will have the credit line available for them to draw upon for up to three months; if they don’t draw from it in that time, they will need to reapply again if they need funds later. The funds will be drawn from capital raised by Spotcap. “We raised 13 million euros of equity funding in October and that brought in a series of fresh investors. [In March] we also raised another 5 million dollars via credit facility, funding the growth of our balance sheet,” Heussler said. “We've raised close to 20 million euros of equity and debt funding and we're in constant dialogue with other investors about providing increased capital of business.” Though he would not disclose how much Spotcap has lent to businesses in Spain and the Netherlands to date, Heussler said the startup has seen over 12,000 businesses apply for credit since it launched nine months ago. He also would not be drawn on particular goals Spotcap has set for Australia, though he did say the company expects that Australia will quickly begin to make up a significant portion of the global business. “The Treasurer and the Prime Minister are telling people to have a go; it's very well and easy to say to have a go, but we're hopefully coming in to bridge that gap in terms of financing those small businesses to go out and find more staff, or to run a marketing campaign, or buy new piece of machinery, or stock more inventory,” Heussler said. “The goal for us is to increase the awareness of the alternative lending sector in general in Australia.” Of course, there is surely more to come after Australia. A Spotcap media release on the local launch called 2015 its “year of expansion.” Co-founder Toby Triebel said, “Our goal is to offer our credit lines to all small businesses in promising markets where financing alternatives are needed. We aim to become the global leader for short-term online business loans.”

Image: Spotcap co-founder Toby Triebel.

Prize Pig

As a small business owner, public recognition around your products or services in mainstream media can bring along with it many benefits. It not only creates a perception about what you do, the uplift in sales as a result of that perception can catapult a business into multimillion dollar sales figures. Just look at brands like Snuggie, Squatty Potty and Haviana as examples of unknown brands that turned into multimillion dollar companies after riding the wave of free media exposure. Founded by Amanda Westphal, Sydney based startup Prize Pig is a new platform that aims to make it easier for small businesses to get access to this media exposure without the overheads of the media spend that would usually come with it. "I've been working in the promotion space for my whole career," says Westphal. "So around 13 years, and I've been fortunate enough to develop some incredible relationships with a lot of media outlets that I'm calling on now to support Prize Pig." Westphal started off her career as a morning radio announcer and told Startup Daily that she used to get incredibly bored waiting for songs to finish so that she could talk. Eventually, the station transferred her over into a promotions role and she loved it. "I started out at the radio station and moved on from there to News FM and took a role with Nova as a Promotions Manager," says Westphal. "I've worked on both sides of the fence, first with media. Then I worked at a PR agency for a couple of years and as the NSW Promotions Manager for Universal Music Group for almost four years, so I've definitely been in the space for a long enough and all my learnings led me to Prize Pig." It is worth noting that in the promotional world, a 'prize pig' is the nickname given to an avid media consumer that always enters competitions. Prize Pig officially launched in January last year. Initially, the business was completely offline and was a very niche PR agency specialising in competitions. However, by October, Westphal says she finally figured out that the future of the company and the answer to scaling the venture was technology. In the same way an online dating service matches people with one another, Prize Pig's platform matches small businesses directly to media outlets they can pitch to within two simple clicks. For example, if a company has a great new safety product for bikes they wish to get media exposure for, and a media entity like Channel Ten were looking for prizes to give away and talk about on Studio 10, in line with a segment it was running about bicycle awareness week, that company or product could be booked in and on camera the next day. Already the platform is seeing some fantastic results with Prize Pig competitions running across media entities such as Channel Ten, Foxtel, MindFood, Mix 104.9, KIIS FM and Southern Cross Austereo Networks. The Kyle and Jackie O show has been a big supporter. A competition is currently running on the show in collaboration with a small business called Bronze Bitch Organic Fake Tan, which only launched a few weeks ago. The platform has been designed to make life easier, automate processes and save time, for not just consumers (the small businesses) but also PR agencies and media companies. "I think we're averaging at about 2 hours a week that we're saving for our media companies," says Westphal. "All they need to do is set up the promotions they wish to run and then just get an update when somebody pitches a prize to them. Media companies then just pick "accept" or "deny", so there's a nice little buffer for them there to make their life easier. It saves them from having awkward conversations". The way Prize Pig makes money is from the small businesses and PR agencies using the platform. For those users, it is a membership site that offers two levels of access: "The Piglet" at $279 per month; and "The Porker" at $549 per month. For media companies, the service is free to use, making it more compelling for them to jump on board and support the cause. Plus, they are also the entity giving thousands of dollars worth of free air-time to the small businesses. Currently, around $750,000 worth of competition space is being made available for Prize Pig users.

Although the business only launched about eight weeks ago, already the platform has just over 110 subscribers and a healthy growing amount of media outlets on board. Of course, building a two-sided marketplace comes with many challenges - including overcoming the chicken and egg conundrum. According to Westphal, the key will be to have as many prize providers as possible. She believes this is what will attract more media companies to use the platform. The other challenge is competition. Essentially Prize Pig is taking on a similar, yet automated, functionality that has usually been fulfilled by PR Agencies that do media give-aways as a secondary service for their clients.

Westphal says that while they may be competitors, public relations and promotions firms actually represent a significant opportunity for the startup.

"If there was ever a really big opportunity for us; it's PR agencies. I was working with Free Publicity prior to starting this business and doing all of their competitions. However, when I left [to start this venture], they started to run all of their competitions through Prize Pig. So they've saved on my wage and pay a small fee on The Pig," says Westphal.

Targeting these types of firms will therefore be a focus for the startup over the next 12 months.

"I would like to partner with many more agencies and I'd like to triple my number of prize providers," she says. "I'd also like exclusivity with every single media outlet in the country. My goal is to be the only place they're going to for prizes."

Featured image: Founder, Prize Pig, Amanda Westphal | Source: Supplied

Blue Chilli Seb(1)

BlueChilli is urging startups to complete its StartRail survey, with the results to be used to produce a series of interactive maps detailing Australia's startup ecosystem. The StartRail map will visualise the startup scene in each Australian city and startup region in the style of a railway network map. It will show the startups in each community and their stage of growth, as well as which university, investors, incubators, accelerators, and coworking spaces they originated from or work at.

BlueChilli's CEO Sebastien Eckersley-Maslin originally came up with the idea for the StartTrail map, based on Sydney's CityRail map, as a task for a graphic design intern. The first map was Sydney-only and divided into three zones: education, incubation, and growth, with organisations like incubators, accelerators, and VCs appearing as stations.

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With the map was last revised in 2013, BlueChilli's Alan Jones said the company has been overwhelmed by the growth in the tech startup sector over the last few years.

“The growth in the Australian startup ecosystem and its outward spread from Sydney and Melbourne into capitals and regional areas across Australia has been enormous,” Jones said.

The company will this year produce a StartRail map for each startup city, region, or community that has ten or more startups completing the survey.

With the startup ecosystem at large booming, the idea of mapping it out has emerged as a useful way to keep track of the different parties and stakeholders involved. Paul Daly, convenor of the Adelaide Entrepreneurship Forum, produced a map showcasing the Adelaide startup ecosystem, while StartupBlink took on the task of creating a global map last year.

You can complete the StartRail survey here.

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BlueChilli to produce interactive StartRail maps for each of Australia’s startup regions