From a precious handful less than a decade ago, coworking spaces are now booming across Australia: as well as spaces popping up across regional areas, Perth’s Flux has doubled in size, Brisbane is set to get a hardware-focused hub next week, WeWork has established itself in the market, the 11-storey, $35 million Sydney Startup Hub officially opened this week – the list goes on.
Among the newest coworking providers is CreativeCubes. Founded by Tobi Skovron and Andy Fernie, CreativeCubes is a coworking community whose workspaces, as Skovron explained, look to “inspire left brain thinking for the right brainers [and] right brain thinking for everybody”.
With the first space opened in Cremorne in September and another set to open in Hawthorn, Skovron said the founders wanted the experience of the space to have residents feel like they’re staying at a six-star hotel.
“Our value proposition is that we’re actually priced more like a three star hotel, packing incredible value into our offering for members,” Skovron said. A dedicated desk starts at $159 per week.
Rather than hacking away long into the night, CreativeCubes has more of a focus on wellness. As such, the newest addition to its offering will be Orange Theory Fitness, a fitness studio that originated out of Los Angeles.
CreativeCubes has invested $4.8 million to bring six Orange Theory Fitness [OTF] franchises to Australia, with a couple to be run in conjunction with the coworking spaces.
“I lived in Los Angeles for over eight years, was a consumer of OTF and loved what they had to offer. In my time as a member, I built a relationship with the LA region franchisee, who has 11 locations in LA, and articulated his vision to co-locate an OTF within the CreativeCubes.Co offering, so Cubes members had a way to focus on their health and wellness and reach their business goals,” Skovron explained.
Working in the same vein as the likes of F45, Orange Theory Fitness works on ‘Orangetheory’, a one hour interval training-based workout.
Skovron said, “I understood intimately that health and wellness have a direct impact on successful businesses and performance. Understanding the high stress of running any-sized company, I felt strongly from personal experience that OTF matched the first-class experience and optimized results and success that I wanted to offer the Cubes community.”
As such, Skovron said it made sense to not just reach out to a local franchisee in Australia and have them open within Cubes spaces, but actually have an input and deliver that experience, “on par, synergistically”, to CreativeCubes. The space has partnered with the LA franchisee to co-purchase the six licenses for Australia.
Skovron explained the goal is to have Orange Theory Fitness in CreativeCubes buildings. In some cases, he said, the studios may be stand-alone, but the goal is to have all the members under one roof.
“It’s a separate offering, so not all members have to participate, and we do welcome non-Cubes members to OTF. We just see incredible value and synergies that we wanted to join together.”
As nearly everyone who has ever worked in retail can attest, the job can be boring, repetitive, and testing when customers decide to try your patience, which can make staying engaged and giving it your all difficult. Of course, that poses a problem for employers.
Cofounded by David Cherrie and James McLaren, Melbourne-born platform Arcade helps retailers keep their sales staff engaged and motivated through gamification of employee goals, recognition, and rewards.
As Cherrie put it, the drive to start Arcade came because it’s “my story”.
“When I first started as a retail associate I was highly engaged and a top performer, but as I grew more comfortable at work, I became complacent and less productive. By gamifying our sales goals, my team and I started to re-engage and put in more effort. This transformed our team culture and within a few months, our store was the highest performing store in the company,” Cherrie said.
“I believe that every employee, regardless of their industry, has potential that is often suppressed because they don’t feel like it matters whether they engage or not. This is why I started Arcade, to give every company the solution they need to ensure their people know that they matter and that their effort at work is valued.”
After coming up with the idea, Cherrie said Arcade began work on a basic iteration of the platform – “what our investor David Evans calls our BMVP, barely minimum viable product – and found a couple of stores willing to work with the startup to help develop Arcade.
“It was really a process of learning from how our users interacted (or tried to), what their feedback was, and ultimately, what was leading to clear success for the customer, a sales lift in-store,” Cherrie said.
As it currently works, employees are given daily goals each morning, and win rewards as they get closer to reaching them, Cherrie explained. They also are given a star each week that they award to a coworker of their choice, with each awarding of a star put on the Arcade newsfeed so everyone can engage with the post.
As employees hit their goals, receive stars, and complete quizzes, they accumulate points which can then be redeemed by the Arcade gift store, which houses various gift cards and experiences. Retailers themselves can also add in their own custom rewards, or merge in their existing employee rewards program.
Meanwhile, employers set the goals and can interact with their employees and track their progress towards the set goals at every level, including districts or states, Cherrie said.
“They can also distribute real-time recognition and rewards to employees. They’re able to share live polls to get feedback from their staff, assign training quizzes and most importantly create instant contests between stores related to their sales and service goals,” he explained.
Arcade is targeting retailers with 50 sales associates or more, with Cherrie explaining these understand the difficulty of keeping their employees highly engaged.
“They know that engagement is vital to the customer experience in their stores. We discuss with them their needs and support them to roll out Arcade into a region of stores where they can assess the value it brings to their organisation,” he said.
“Almost every retailer has their employees using a free chat application to communicate between stores and engage their workforce, but it’s painfully inadequate. Whether retailers admit it or not, their retail workers are currently using consumer social apps for engaging and connecting that are the root of a lot of HR nightmares. We solve this in Arcade by providing the company with a safe, secure and holistic solution to engage and connect with their workforce.”
Having grown out of Melbourne, the startup soon began looking to the US for further growth.
“When we first started, it was clear that the market in Australia was going to be a great place for validation, and the American market was the place for growth. As soon as we got our first customers in Australia, we opened up our sales office in the US,” Cherrie said.
Opening an office in Dallas, Texas, the startup focused on finding a network of people, from advisors to investors, who know the market and retail space. Through this it found the RevTech accelerator and fund, which is focused on retail technology startups, and brought on funding .
“We found that RevTech had incredibly valuable expertise, great retail connections and, most importantly, a clear vision for innovating the retail space globally,” Cherrie said.
The startup had originally tried out San Francisco as its American base before heading to Dallas.
As Cherrie put it, “The best part about Dallas is the people. There is a wealth of talented people in Dallas that want to work in exciting spaces and build game-changing companies. Its cost of living is also far less than San Francisco…and its geographical centricity to the rest of the US means we can fly anywhere in just a couple of hours.”
Beyond traditional retail, Cherrie said Arcade also has clients across the car sales, pop up sales, door to door sales, and multi-level market spaces; among its clients are Toyota, Snooze, and Under Armour.
“We’ve also had companies ask for Arcade in the service industry, especially in casual dining and hotels, so we see that as another big opportunity,” he said.
With all this in mind, Cherrie said Arcade has “big growth goals for 2018 all round”; on the cards is raising a round of funding, and doubling quarterly sales.
Canberra cybersecurity startup Penten has nabbed a $1.3 million innovation contract to develop a cryptography solution for the Australian Army.
According to Minister for Defence Industry, Christopher Pyne, the project was chosen as part of the Special Notice platform being trialled by the Defence Innovation Hub, which allows industry and research organisations to submit proposals to capability challenges posted by Defence.
The contract will see Penten develop its AltoCrypt solution, which facilitates mobile access to government networks.
“This advanced communication technology can be rapidly deployed to individual computers, which will change the way classified information is shared, used and accessed,” Pyne said.
“The development of these devices aims to increase agility, reduce complexity and enable better decisions by ADF commanders and their staff in a tactical environment.”
Pyne said initial trials will test how the technology could be used with partners, with the potential to increase classification in the future.
The CDIC, backed by a $230 million government investment over 10 years, offers Australian businesses a space to interact with defence experts to learn more about developing the skills and resources required to work within the Australian Defence industry.
Pyne said at the time that the Defence Innovation Hub will invest around $640 million over 10 years into maturing and further developing technologies that have moved from the early science stages into the engineering and development stages.
In addition to outlining spending across “critical infrastructure” and weaponry, the statement pledged a $1.6 billion total investment towards streamlining Defence innovation.
Beyond the $640 million given through the Defence Innovation Hub, another $730 million will be invested under the Next Generation Technologies Fund into developing innovative technologies to be used within Australian Defence.
The government also last year announced $50 million in funding for a Defence Cooperative Research Centre (CRC) that will focus on the development of Trusted Autonomous Systems, or unmanned platforms for military operations.
The CRC will receive $8 million in funding annually over seven years to bring together academia, publicly-funded research agencies, and industry to deliver platforms “that ensure reliable and effective cooperation between people and machines during dynamic military operations”.
A further $500 million in funding was also announced last year to improve Australia’s space-based surveillance and intelligence capabilities.
Startup Weekend events are now a staple of Australia’s startup ecosystem. There were over 20 last year, ranging from agtech through to female founder events. It’s getting bigger too. By the first week of March this year, there will have already been six Startup Weekends.
For those still unfamiliar with the concept, you essentially attend an event, build a team from the people you meet and work for 54 hours straight on a business idea. Then, to cap it all off, you present it to a panel of expert judges.
In our experience of running several of these events and Australia’s only creative tech Startup Weekend, they can be quite daunting for first-timers. So we’ve put together six of our best tips for getting the most out of them.
We can’t stress this enough, but charge all of your devices ahead of time! Also bring the various plugs you need to charge them at the event. Having your computer crash mid-event — deleting all your work in the process — is not something you want to happen. Prepare for it, and it won’t.
Aside from that, most Startup Weekends will provide snacks, meals and also stationary for planning. But anything that helps get the creative juices flowing should be a consideration.
Don’t get stuck on one idea
If you’ve done your homework, then you have likely come to a Startup Weekend with an idea that you think will blow everyone else’s out of the water. This is the wrong mindset. While it happens for some, don’t assume this is a staging ground to build your dream company. It is however, a great place to get your idea challenged and to gain the skills to do so later on.
Have an idea, but prepare for it to be scrutinised and even completely reworked by your team. It sounds obvious, but keeping an open mind and hearing everyone else in your team out is crucial through the entire process, but particularly in the first day when you are deciding what problem you are looking to solve.
Compromise and don’t get caught up in ego
Pushing ego aside is easier said than done, but it’s crucial for success at a Startup Weekend. Many forget this this is a group activity, meaning that no matter how hard you try or how good you are, you can’t succeed alone.
From our experience, the winning teams are often ones that can move past disagreements easily and making decisions that benefit the entire group. Consider creating a mediation process for these disputes earlier rather than later in the event.
Diversify your team
It’s easy to fall into the trap of working in a team of people you just met that has all the same strengths and interests. But this can ultimately short-change your fledgeling business from the perspective and expertise it needs to thrive.
Consider everyone’s strengths when forming your team. The more diverse the better. If in doubt on how to construct the best kind of team, refer to the ‘Hipster, Hacker, and Hustler’ rule – creatives, tech experts, and confident spokespeople.
Please, please, don’t skip a meal
Fasting to keep yourself ‘mentally fit’ may be a fad in Silicon Valley, but it isn’t something we’d recommend for any Startup Weekend. This is an intense experience, and your body will need all the support it can get it. No founder can survive on a diet of coffee and adrenaline.
Keep these tips in mind, and remember, these Startup Weekend events aren’t all about winning. Regardless of your place, even making it to the end is a great feat and will arm you with the skills and contacts to better build your own business.
Shelli Trung is the Expert in Residence and Investment Fund Manager at QUT Creative Enterprise Australia (CEA). She is one of the founding members of the Techfugees Hackathon in Melbourne and will be a mentor at CEA’s Startup Weekend Creative Tech from 2-4 March.
With shares priced at $0.45 per share, the company is also set to launch a Share Purchase Plan to raise an additional $3 million from existing eligible shareholders, with the funding to go towards the company’s sales, marketing, and customer success teams.
Karl Redenbach, cofounder and CEO of LiveTiles, said, “We continue to see strong demand and excitement for our products, including our artificial intelligence offering, and our ability to continue to secure additional customers and grow revenue at a rapid pace is only limited by the resources available to pursue leads and convert additional customers.”
The raise follows LiveTiles last week having to answer questions posed by the ASX around the funding of its operations.
With LiveTiles’ quarterly report, lodged in December, showing the company had negative net operating cash flows for the quarter of $5.311 million, cash at the end of the quarter of $7.92 million, and estimated cash outflows for this quarter of $6.02 million, the ASX raised concern about whether LiveTiles would have sufficient cash to fund its operations for the next two quarters.
LiveTiles responded that it had a “number of options” available to fund ongoing operations, including a capital raising, reducing expenditure, and increasing revenue, also noting that it received $2.1 million in government grant funding in January.
The company last raised $11 million via a share placement last August, with 61.1 million shares issued at the time at $0.18 per share. The raise also saw an investment of $400,000 from Redenbach, cofounder Peter Nguyen-Brown, non-executive chairman Andrew Gray, and non-executive director Andy McKeon.
GetSwift requested a trading halt in late January as it prepared its responses. With GetSwift and the ASX then going back and forth, GetSwift most recently asked for its shares to remain suspended as consulting firm PwC reviews its market statements and disclosure practices.
Victorian food and agtech incubator program Rocket Seeder has partnered with MLA Donor Company (MDC), a subsidiary of Meat & Livestock Australia, to explore opportunities for innovation with red meat.
With MDC working to explore opportunities across the value chain for the red meat and livestock industry by attracting co-investment for innovation projects, the organisations will work together to offer participants one-day design sprint workshops, a design challenge, and a 14 week accelerator program.
Michael Lee, manager of MDC’s High Value Food Frontiers program, said changing consumer trends and lifestyles represent “new high value growth opportunities” for the Australian red meat industry.
“With the global demand for protein increasing, and red meat playing a key role in the Australian diet, the opportunity for novel, meat-based food products to capture a share of the market is strong,” he said.
“This collaboration with Rocket Seeder broadens our existing network of agtech, foodtech and food innovation partners and will further help attract new entrepreneurs and startups to create commercially viable solutions that will underpin a long-term sustainable competitive position for our industry.”
Jeffrey Bourne, managing director of Rocket Seeder, said the program has been designed specifically for the red meat industry.
“Rocket Seeder’s experience helping food entrepreneurs bring new products and services to market quickly, combined with MDC’s intimate knowledge of the red meat industry, means we have been able to tailor the program to maximise the benefits for the sector,” he said.
This value chain covers the likes of those working with land, seed, fertiliser, stock and feed to those in production, processing, packaging, warehousing and distribution, wholesale and retail, or preparation and consumption.
Among the graduates from Rocket Seeder’s first cohort is Feastively,a meal kit delivery service promising consumers that they can cook their own healthy dinner in 15 minutes, in just one pan.
Just like competitors HelloFresh and Marley Spoon, Feastively still has customers head online to check out the menu, which changes each week, to order their meal kits for the week, but upon delivery they will find that Feastively’s chefs have done all the chopping of ingredients and pre-cooking for them.
Matt Berriman, CEO of high-flying adtech startup Unlockd, has announced he is stepping down as chief of the company to look after his mental health.
In an open letter posted to Medium today, Berriman wrote that he is “extremely proud” of the company’s success so far, “it has not been an easy journey” and it has required him to “pour blood, sweat, and tears (and all of my money) into the business”.
He wrote, “Throughout the journey I began to experience symptoms, which I attributed for far too long to stress, lack of sleep and the startup rollercoaster. What I did not know at the time was I was fighting a battle with bipolar disorder.
“Bipolar is an illness that has an over indexed relationship with high functioning business leaders, artists, sportspeople, and musicians. Over the last 15 months, despite continuous and multi-faceted treatments I’m still struggling to return to my optimal holistic health, and as a result I now need to put a larger commitment in place to concurrently prioritise my health with my commitment to Unlockd.”
In stepping down from the CEO job, Berriman will move into the role of executive director; here he said he will focus on the overall strategic direction of the business, corporate development, and major shareholder relations.
“This will allow me to continue influencing the growth and future of the business, whilst also giving me the required space to make my health a priority,” he wrote.
Taking over as CEO on a day to day basis will be Jane Martino; most recently chief operating officer at Unlockd, Berriman said the CEO role is one “she has effectively been playing for some time now behind the scenes”.
“The success of the business is significantly attributable to her operational control, and in addition to the qualities she exhibits as a person leave me in total confidence and faith of her succeeding me as CEO,” he wrote.
Acknowledging his news would “evoke various reactions”, Berriman said the decision to make his journey public came in the hopes of taking a step forward in creating greater awareness of mental illness.
“Hopefully in some incremental way it helps the community better understand that mental illness — which affects one in five people — doesn’t discriminate, whether you are a professional sportsperson, high flying executive, small business owner, employee working 9–5 at the local butcher, or a parent at home with the kids…and nor does it debilitate someone’s ability to achieve their goals.”
Looking to encourage open discussion around this issue in the Australian startup community, Fishburners last November held a talk on mental health, with AirTree Ventures’ Daniel Petre, Taryn Williams of The Right Fit, and a representative from Beyondblue among those speaking.
There is a stigma about having an unsuccessful startup, as it can quickly go from excitedly telling others about your idea to explaining why you have moved back in with your parents. But a failed startup shouldn’t be viewed so negatively by those in the business world, or by others.
Many budding entrepreneurs who decide to commence a startup are excited about potential growth while nervous about failure, but the statistics aren’t helping any fears people might have.
A report from Dun & Bradstreet shows that the startup failure rate is on the rise with a 42 percent increase in the number of startups ceasing operations.
While it is challenging to make it big, people should not be ashamed for opening a startup that didn’t go as planned.
Many people will look at this as a bad thing, but here’s why it is quite the opposite.
It’s not failing, it’s practice
An unsuccessful startup should be placed in the same category as practice or training. Just like you train for a marathon or study before a test, the only real way to practice running a business is to actually start one.
Startups are the best way to do practice as there’s a lot less on the line than buying an established business or franchise. Failing a business in its early stages is much more harmless than folding later down the track.
There are less staff that will become unemployed and there is likely to be less money invested.
People shouldn’t think of it as investing time and money into a business that went nowhere. If you don’t win a gold medal, does that make competing at the Olympics any less of a valuable experience? No, and it’s the same in the startup and small business world.
There’s still scope for a second, third, and fourth chance
Classifying an unsuccessful startup as ‘practice’ implies that there will be another attempt at starting a business and many people that I come across are planning to do just that.
This cloud really does have a silver lining and the founders of these businesses could use what they have learnt for the better.
Things from the get-go could be done different, experts should be called in sooner, or more market research undertaken.
These are the most common things I hear when talking to former startup owners that they wish they had done.
Attitudes need to change
Many people that try to start businesses in Australia can’t stand the thought of failing.
Some cultures, particularly in Asia, do not accept a failed business in such a way, and international students in Australia don’t want to go home and explain to their parents that their business was hardly able to take off the ground.
I have worked with budding entrepreneurs in Outcome.Hub, most which are international students. One international graduate had a shot at creating an app that simplifies the process of choosing a restaurant. However, the pin was pulled early when it was discovered it was too hard of an app to monetise.
While the founder feels like a disappointment and is trying to save face in front of his parents, it should be seen in a completely different light.
I know that this particular graduate has learnt so much from what has been an incredibly valuable experience but many people, and even the statistics, don’t see it that way.
Our perceptions and attitudes towards failed businesses needs to change so that it isn’t seen as a bad thing but as more of a stepping stone to startup success.
Gerard Holland is the cofounder of Outcome.Life, empowering international students through independent advice and help, planning for life after study.
It’s not failing, it’s ‘flearning’ – Startup Daily had a chat to founders about what they learned from a previous business:
Fresh off adding outgoing Fishburners CEO Annie Parker to its roster as its global head of startups, Microsoft has provided another boost to the Australian startup ecosystem, today announcing the launch of its ScaleUp program in Sydney.
With the program to be run out of the Sydney Startup Hub, opened last year in Wynyard, Microsoft Australia managing director Steven Worrall said Sydney’s selection is a “resounding acknowledgement of both the quality and potential of Australian tech startups and entrepreneurs”.
“Our aim is to be the ‘glue’ that connects the startup ecosystem in Australia. Being part of the Sydney Startup Hub enables us to realise that ambition. For any business to succeed it needs strong local and global connections and we believe Microsoft can help a startup be global from the outset,” he said.
First launched five years ago, Microsoft has run ScaleUp – formerly known as the Microsoft Accelerator – in cities including Seattle, Beijing, and London, with Sydney now its eighth location. With a focus on business-to-business and software-as-a-service startups, almost 700 companies have graduated from the program, with a collective US$3 billion raised by alumni and 48 exits.
Running for four months, Microsoft stated the program focuses on both business and technical development, giving participants access to mentorship, Microsoft tech tools, and the company’s global network of clients. The program does not take equity.
The first Sydney program is scheduled to run before the end of the year, with Microsoft currently in the process of recruiting a managing director to lead it.
Announcing the news with Worrall at the Sydney Startup Hub this morning, Deputy Premier of NSW John Barilaro said the company’s decision to move into the space is “a huge vote of confidence in our city, our economy and the people that make up our startup community”.
“Within Microsoft, there is enormous competition to secure Microsoft ScaleUp for different countries, so it’s an incredible result to see Sydney chosen as the newest location to host this sought-after and highly-acclaimed program,” he said.
Beyond the program, Microsoft stated it will be an “active tenant” of the Sydney Startup Hub, running events, hackathons, and other activities open to the wider startup community.
With Tank Stream Labs, Fishburners, Stone & Chalk, and The Studio announced as anchor tenants, the various spaces began opening their doors late last year, with the majority now settled in and The Studio, a hub for startups in the creative and new media space, scheduled to open next month.
Parker, who is due to make the move to Microsoft in the coming weeks, told Startup Daily in December that bringing the city’s startup community together at the Sydney Startup Hub would go a long way to attracting international talent and opportunities.
“Look at Fishburners’ successful alumni, those of Tank Stream Labs and Stone & Chalk; the power of that message is greater than the sum of all the parts, and that’s what the Sydney Startup Hub is all about, trying to capitalise and get a multiplier effect by having us all in one place so we are much better at attracting that global talent,” she said.
Following in the footsteps of the state government, which appointed Mark Sowerby as its inaugural Chief Entrepreneur a year ago and recently passed the title onto Steve Baxter, the University of Queensland has appointed a Chief Student Entrepreneur.
Taking on the role is Ben Coughlin, a third year economics student and founder of Backyard Coach, a platform connecting customers to instructors for private swimming lessons.
In the role, which sits within the university’s UQ Idea Hub, Coughlin will be charged with inspiring and mentoring fellow innovators at the university.
Professor Iain Watson, UQ deputy vice chancellor (external engagement), said, “As the inaugural Chief Student Entrepreneur, Mr Coughlin will help inspire and mentor other students in entrepreneurship and innovation.”
“His wealth of entrepreneurship knowledge ensures he will be able to offer students a unique perspective as a young mentor.”
Coughlin, who has taken part in the ilab germinate accelerator, among other programs, and won the Lord Mayor’s Budding Entrepreneur Grant in 2016, said he is excited to give back to the UQ Idea Hub and help grow the community.
“The ongoing support I received from the UQ Idea Hub, even after I’d completed the intensive workshop program, truly taught me how to grow a business and engage in the Australian startup ecosystem. UQ Idea Hub was essential, and still is, in developing the skills needed to pursue my business,” he said.
“I’ve been coaching sport for four years and there’s nothing more rewarding than helping others discover their own path to achieve their goals.”
The creation of the Chief Student Entrepreneur role comes as more universities develop and get serious about entrepreneurship programs.
With the University of Queensland long having run startup programs, it opened the Idea Hub last year to provide a coworking space for students to get their ideas going.
The university said the space is to act as an extension of its RMIT Activator online program, which offers an interactive digital way for university members to explore their ideas.
More recently, the University of Queensland partnered with HYPE Foundation to form Australia’s first sports technology-focused accelerator program, Hype UQ Spin Lab.
All programs align with a major upcoming sporting event, at which the startups pitch their companies to a captive audience of sports industry influencers, investors, and potential partners. Previous events have included an NFL Draft and the World Cup; the Australian cohort will have run its demo day as part of a sports innovation event running in parallel to the Commonwealth Games, taking place on the Gold Coast in April.
Image: Ben Coughlin and Professor Iain Watson. Source: Supplied.
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