SciBlogs

Posts Tagged Innovation

A hidden gem in Callaghan Innovation’s business case? Peter Kerr Jan 21

1 Comment

Callaghan Innovation’s business case came out a week before Christmas among a flurry of keep it under the radar government documents released about the same time.

(Ironically, the business case appeared a couple of hours after sticK commented that it hadn’t turned up…though I’m not claiming any credit!).

As a some people commented, it wasn’t much different from CI’s Statement of Intent delivered in late July.

But, delving among the entrails is the first new, rather than inherited, scheme put up by the Crown Agency.

A repayable grants programme. (As described in their own words on page nine of the document it is):

Repayable Grants Programme: provides grants to technology-focused incubators in order to create and nurture new businesses based on promising areas of technology. This new programme will ramp up to providing 24 grants annually of $450,000. These grants must be repaid once the new businesses begin generating revenues.

Now there’s not much flesh or other information around this RPG, but what it essentially is, is a repayable loan if and when a fledgling company starts making money.

Israel (among a number of exemplar countries) has had this model for a number of years, as mentioned in the fourth paragraph of a guest blog by Daniel Saunders in VCCafe.

From what I gather, the main advantage of such a repayable loan is it recognises that many technology focused ventures are risky; a punt.

That being the fact, if they succeed, the money’s paid back. If not, ‘deems da breaks’.

It is also relatively simple to administer – and much less influenced by a bureaucrat’s whim (apparently).

So, a bit of a thumbs up for Callaghan Innovation…some innovation of its own.

We’ll look forward to seeing how the RGP is going to work in actuality, as Callaghan Innovation works towards its stated ideal of being a small R and big D in New Zealand’s R&D (research and development) landscape.


PledgeMe co-flounderer’s words of wisdom Peter Kerr Jan 14

No Comments

 You’ve got to give a bit of kudos to someone who calls themselves the chief bubble blower and co-flounderer (yes, spelling is correct) of a company.

Whether you call New Zealand’s first crowd-funding platform PledgeMe a startup is debateable, as the 18 month company is still alive, kicking and more importantly growing.

Said, co-flounderer Anna Guenther gave a short presentation to Wellington’s Entrepreneur’s Club recently, highlighting the mostly ups, and a few of the learnings for PledgeMe that has so far raised $2.1 million across 470 successful fund-raising projects.

PledgeMe’s business model is a 5% success fee commission (with an additional 2.8% to pay for credit card fees). And while of course earning your way is important, you get the feeling Guenther’s absolutely enjoying enabling mostly community projects with an average size of $3500. Apparently 49% of all projects receive their funding target.

I suspect she’s excluded from this average size figure their most successful fund-raising – a $207,000 Christchurch sculpture initiative (matched by Westpac, and with an additional $180,000 sent in by cheques!).

The oldest successful fund-raiser was 82 year old Stu Buchanan, a jazz band leader who crowd-sourced (including from three generations of students he’s taught) enough money to put together his first ever album. He ticked it off his bucket-list!

Guenther gave the following wisdomettes for anyone starting up. Being an internet wizard, she’s also put these points up so you can check it out on Dropbox.

  • Choose the right partner
  • Have a hard conversation at the start around a shareholder agreement. The discussion can focus around the who’s idea it was, the writing of the business plan, other expertise brought to the table. What are people going to be contributing now and down the line?
  • Ask for help – a coffee or beer can be empowering in the knowledge and networks that result
  • Sometimes you have to jump (code is never ready!). Have a launch party, then you have to begin
  • Build networks without expectations. In 12 months, you never know, those contacts could ignite
  • Surround yourself with smart people. You don’t want to be (or think you are) the smartest person in the room
  • Design. The best dollars spent are at the start – and that means making the brand look good and people wanting to connect with it
  • You can’t compare your feelings inside, with others’ outside website. In other words, what other startups show as their exterior view, in no way matches the undoubted angst and sometimes indecision that goes on inside. (Guenther acknowledged Rowan Simpson’s advice on this one)

Geunther also encouraged taking any opportunity to speak at other peoples’ events, launches, meetings as a way of spreading the word/love.

When asked if she thought that the recent launch of an NZ-oriented Kickstarter would affect PledgeMe, she felt no.

“We’re different, and we believe that local is important to us,” she says.

“But indeed, if anyone wants some advice about putting a project up on Kickstarter, or on PledgeMe, give me a yell.”


Callaghan Innovation’s evolution gets curiouser and curiouser Peter Kerr Dec 17

5 Comments

The analogy of Alice in Wonderland, and curiouser and curiouser comes to mind with Callaghan Innovation.

That and a type of ennui as the 14-months-in-existence Crown Agent struggles to come into life.

Firstly, rumour has it (from a number of well-informed people) that minister of everything Steven Joyce is sitting on CI’s business plan.

Such a business plan was meant to be delivered not long after (but never really defined) CI’s Statement of Intent which came out in early July.

So six months later all we still have is a generic SOI of what Callaghan Innovation will do.

How, (the hard part) is still to be revealed through this business plan. Which, by inference means Steven’s just a bit wary (and one suspects weary) of it.

But wait, there’s more.

In the meantime, there’s been an announcement of a new stakeholder advisory board for CI.

As the press release says:

“This panel of experts will support the Callaghan Innovation Governance Board to deliver fresh thinking, and offer a diversity of perspective and experience that will help grow New Zealand’s economy through science and innovation.”

Intriguing.

The Callaghan Innovation board was announced in January.

Just what has it, and more particularly its chair Sue Suckling been up to since then?

And, with the advisory board on-board as well, who is going to be responsible for what?

sticK always argued that the cart was in front of the horse in effectively scrapping the old IRL without defining what the new entity would do, or how it would do it.

While building the plane while you fly it may be OK for bootstrapping startups, doing the same with 400 or so scientists and engineers already employed is a much less validated process.

You have to suspect that Steven Joyce wishes he’d backed the well-planned potential morphing of IRL into an Advanced Technology Institute model, similar to say Taiwan’s ITRI.

The other exemplar that has been touted is the Danish Technology Institute. Callaghan representatives (and dozens of other NZ science people have visited this over the past decade).

Both ITRI and DTI are applied science/engineering-heavy entities that work hand-in-glove with industry and academia to turn prototypes and concepts into sellable commercial products.

Both have a well-defined mandate; they know their role.

Which, for all the commercialisation-speak of the embryonic Callaghan Innovation; it is still a long way off defining.

Quite where and how the new CI stakeholder advisory board will ‘advise’ Callaghan Innovation will be fascinating.

But, if the advisory board chairman Andrew Coy (magnetic resonance equipment-maker Magritek chief executive) wanted to help the country and his own company’s growth, he could do much worse than suggest dusting off the ATI model.

It could be just the thing to bring to a Mad Tea Party.


We’re getting over our notions of shame around business failure Peter Kerr Dec 10

No Comments

I’m putting the proposition out there that we’re getting over our collective Kiwi hang-up about startup and business failure.

That is, whereas in the past we’d write somebody off for having tried, and been not successful in a new business venture – these days we’re much more inclined to encourage them to dust themselves off, and get on with something else.

From that point of view, we’re becoming much more American in our attitude to ‘failure’, and as long as it is failure for the right reasons, are inclined to regard it as experience.

This was the basis of a speech I recently had the privilege of giving to the NZ Institute of Patent Attorneys in Wellington.

Now, there’s no academic research that’s been carried out on this change in our collective attitude; not that I could find anyway.

And, in checking with Professor Sally Davenport of Victoria University’s School of Management, she doesn’t believe there’s been any study of this kind either – but being ever-entrepreneurial herself, would be keen to research the topic if some funding was available.

In talking about some of the anecdotal evidence for the proposition (see below), Sally made the following observation.

“It is how these things become normalised. We’re getting over the tipping point.”

So, and based pretty much on a gut feel, what’s some evidence that we’re collectively over a tipping point with regard to business failure.

Item 1.

Lightning Labs.

Now this Wellington (and nationwide) initiative to fast track good ideas into investor-backable businesses saw nine February startups, pitch to would be financiers in May.

Four of the startups garnered over $2 million in investment between them. Just as notably in a September press release was the unashamed dealing with and description of what the unsuccessful fund-finders were up to.

Some are still building their business model, one’s taking an amateur sports funding concept to South America, and the other teams have moved onto other ventures. But, they’ll all be back for LL II next year. To all extent and purposes, this LL press release was a recognition, if not a celebration of failure, and of its absolute value.

Item 2.

The TIN 100 report, though in this context the discussion around the report which came out in late October.

TIN 100 report founder Greg Shanahan gets to meet a fair number of the founders of these companies, including those of the TIN 100+, those smaller companies (less than $2 million annual turnover) hovering outside the main group.

“Most were baby-boomers, most were grey-haired,” says Shanahan.

What he didn’t say, but is sure to be the case is that a fair number of these CEOs will have known previous non-success.

This age group belies the notion that all entrepreneurs are in their twenties – and backs the stats that it is older people who actually begin more startups than younger (see a couple of studies, here and here).

The other ‘advantage’ of baby-boomer entrepreneurs is we’re more prepared have a go. At our age, failure is in fact NOT trying.

Item 3.

The Dead Startup Society.

A couple of years ago, the idea of getting together to commemorate a business failure would’ve been an absolute non-starter. But the packed-out attendance of this offshoot of Lean Startup Wellington on November 20 showed how cathartic people found the experience (I’ll get up next time to demonstrate my non-success).

As the Dead Startup Society said on its Meetup page:

“Many of us have been involved in startups that have failed – some quietly, some spectacularly, most somewhere in between. Come along to reflect and share our failures and the lessons we’ve learned from them.”

If there is anything that demonstrates a change in attitude, it is an ability to take the mickey out of ourselves.

Laughing about failure, after you’ve swallowed its bitter pill, takes away its stigma.

This part of our NZ tall poppy syndrome (the knocking machine) is no longer the invisible anchor preventing those of us who have failed for the right reasons, from getting out there and having another go.

Live long and prosper – as Star Trek’s Spock would say.


KiwiNet and the sell of commercialisation Peter Kerr Nov 26

1 Comment

There’s always something to learn at commercialisation workshops.

KiwiNet, the group-hug of university and CRI commercialisation units held a Wellington-based forum around understanding customers.

So, here’s couple of interesting bits and pieces from the day – of which I was only able to attend some of, so this is in no way representative.

KiwiNet chair Ruth Richardson, also sits on the KiwiNet Pre-Seed Accelerator Fund (PSAF) investment committee that evaluates ideas put forward by its members – before such ideas are put forward to MBIE.

She gave some investment criteria tips for the ±30 attendees.

  • The ‘sell’ usually comes in your answers to the question and answers, not in the initial presentation
  • Show your enthusiasm
  • Bring your principal investigator if you can
  • Bringing a representative from the business partner can work very well
  • External expert advice can add substantial value
  • Demonstrate value right along the supply chain
  • If you’re unsure, try a project review
  • Listen to the committee and address the concerns
  • It’s OK to fail

Magritek CEO Andrew Coy (risking, he reckons the wrath of his work colleagues) considers that the drivers of a successful academic scientist and commercialiser (who could be a scientist) are different.

Difference/orientation between an academic scientist and a commercial scientist

Science Commercial
Ideas Execution
Best Good enough
Right Successful
Thorough Fast
Publish Secret
Individual Team
Funding Investment and return
Wide ranging Focus
Happy PBRF Happy customer

Coy commented that sometimes universities get very tied up in trying to value intellectual property, before any money has been made from a possible venture.

“Share in the future value, not today’s costs,” he says.

He gave the example of Stanford University. The university owns any IP that comes from its scientists while they’re working there – but the university then licences it back to the inventor for a dollar. They then have a huge incentive to make the technology worth something.

Finally, Coy says rather than attempting to tie up any intellectual property in patents and the like, “the best IP is about making it work in reality,” he says.

“You want something that is hard to do, and you have to do lots of little things right to achieve it.”


‘Always be pitching, looking for feedback’ – Wipster’s Rollo Wenlock Peter Kerr Nov 19

No Comments

“Get your idea out there as much as possible, pitch it to everyone, even to strangers in a cafe, see what happens. If it doesn’t resonate, you probably don’t have anything.”

That was Wipster head sherang’s advice given at Wellington’s Entrepreneur’s Club in mid October.

Wipster was part of the Capital’s Lightning Lab initial inductees, and successfully pitched to 150 investors at Demo-Day in Mid-May. This capital raising brought in $600,000 for the startup – though this took a fair bit of too-ing and fro-ing, and it wasn’t till August that the money was locked down.

The cloud platform based service allows work-in-progress videos to be easily shared with team mates and clients, who can annotate feedback directly on the video.

Essentially, it streamlines the whole video-making process, with the video itself becoming the canvas for all communication to go through.

Compared to endless email chains which require naming a particular timestamp of the video, and then the editor having to go back and forwards from email to video, it is a neat solution to a problem says Rollo Wenlock.

He’s been in the video/film production and editing arena for a number of years, so is well versed in the frustrations of getting a final, edited and agreed by all participants, video out the door.

Considering that Wenlock had his lightbulb moment for what became Wipster only last November, he and Wipster have come a long way. Admittedly, Wipster’s been testing ever-improving versions of their product to those who have signed up as Beta customers.

But more importantly, the company’s about to hire a rockstar marketing/sales person whose sole focus will be to get out and sell to some of an estimated two million video-makers around the world, with a November 1 release date for a thoroughly tested product.

This includes staying in touch with, and letting some of the 2000 people using the software know what is happening, and using them to test and help refine Wipster.

Wipster now also has a board of directors, a chief technical officer, designer, front end developer, “and myself”, says Wenlock.

But he’s a passionate promoter of Wipster, and leading the charge while learning new skills along the way.

He’s also clearly having a lot of fun in the new role.

“We’re always one step from failure; but by putting yourself in the firing line, there’s always the chance you’re going to succeed magnificently.”

Wenlock gave two (formal) pieces of advice – given that the entire 20 minute informal presentation was a wealth of how to’s.

  • The importance of a startup getting to ‘product market fit’. This can take months – and is validated is when you get multiple customers buying the product
  • Startup is a buzzword. Focus on what problem you are solving; and then what’s your solution is to that problem.

“Then tell everyone. Don’t secretly develop it, loudly develop it. You’re building a business, and that’s why nobody gives a s#@t about the idea – action is the only thing,” he says.

Wenlock calculates that if Wipster can be useful for 5% of the two million video producers, who will be happy to pay $49/month for the service, then a viable business can be created.

The Wipster team also has a range of additional features ready to be rolled out, which will compliment the core feature ‘comment on the video’, but it all needs validating…

Wenlock’s zeal for Wipster, and ability to succinctly explain why it is good and the problem it solves is obviously key to its ongoing success in such a short timespan.

The recent launch of the 9th edition of the TIN 100 (successful high technology companies) showed that much of NZ’s ICT international success is based on being in the cloud, with a SaaS (software as a service) for which recurring revenue is generated.

Wipster ticks all the boxes.

Don’t be surprised to see this Wipster weightless product making the lower echelons of the TIN 100 (the TIN 100+, more than $2 million in revenue a year) in the not too distant future


High tech bible also delivers insights into business disposition Peter Kerr Nov 12

No Comments

The TIN100 Report aims to be an authoritative, dispassionate look at the high tech manufacturing, ICT and biotech industries of New Zealand.

Through a thorough process, TIN100 founder Greg Shanahan, and research and publication manager Jo-Anne Hazel have put together a 9th edition of what is the go to bible for these clever companies.

As such it is quantitative, and as a type of tool, Shanahan says the report isn’t necessarily trying to be an opinion leader or think tank.

But such is the qualitative gems unearthed through its discovery process, the TIN100 does reveal far more than meets the eye.

This was especially so during the three city launch, with some of the following points provided by Shanahan in his presentation, and equally the questioning (in Wellington on Thursday October 24).

  • The vagaries of exchange rate movement almost appear to be a given by CEOs. They’re accepting of the environment they play in, and trying to be more competitive. Their focus is therefore sales growth, staff, profitability and R&D
  • R&D expenditure increased 7.5% across the TIN100
  • The aspirational business model for ICT companies is recurring revenue, especially through Software as a Service (SaaS), which allows companies to keep in touch with their customers, retain a relationship (compared to an enterprise model
  • Recurring revenue can be just as important for manufacturing companies – Fisher & Paykel Healthcare makes 70% of its money through consumables sales
  • ICT companies haven’t (yet) had to concentrate on Asian markets – which are perceived as being less easy to enter. ICT companies have more than enough on their hands in markets such as the USA
  • One of NZ’s competitive advantages is companies here can very cost effectively develop world leading cost effective solutions compared to large offshore entities.
  • Kiwi innovation (in NZ) being done by South Africans, Russians, Indians and others (as well as NZ-born people). NZ is attracting some of the world’s best talent
  • Is quite a good chance that NZ companies under-report R&D. Can carry out research “on the smell of an oily rag” compared to what it could cost in say America. Multidisciplinary teams in NZ, with low overheads
  • ICT companies within NZ needing 1000 new employees a year

Shanahan made the final point that the CEOs of these TIN100 companies are invariably very focused, smart and pragmatic.

“They’re grounded. No one is too cocky and they’re very self-effacing. At the end of the day too, they’re communicators and they’re salespeople.”


New fund slips onto radar – though not many have noticed its arrival Peter Kerr Nov 05

No Comments

In the same week that the Punakaiki Fund was abandoned, came a much less heralded, but much more important deal for NZ Inc.

Wellington-based Endeavour Capital is, in the New Zealand sense, a veteran in the early stage and startup investment stakes.

But its new fund is quite different, and promises to help solve the ongoing challenge of capital growth for Kiwi companies, without them having to relocate offshore to follow the money.

It is also a way to get over the ‘valley of death’ funding dilemma for innovative early stage companies – those that have received a million or two in initial capital, but need say another $10 million to push on with R&D and marketing and distribution to globally scale up to the next level of growth.

This type of capital requirement is beyond local angel investors or even NZ-based venture capital sources.
Endeavour’s new $200 million fund is provided by mostly offshore investors, from networks already established in Asia, the USA and the Gulf States.

A recent interview with UniServices CEO Andy Shenk emphasised the importance of ‘capital of the right kind’ for new company growth.

The right kind of capital comes with advice, connections and new ideas.

Now, the successful applicants to the new Endeavour Capital fund will have to demonstrate they have proven management teams, and offer products or services that can link into the international distribution networks that are virtually attached to the fund.

However, given that the investors have a vested interest in their NZ-oriented investments making good, the ability for new Kiwi products (with global aspirations) to seamlessly link into those networks will be priceless. This will be capital of the right kind as Shenk (himself an ex-pat American) extols.

Just as importantly, it will provide a better chance of New Zealand companies being able to remain located here, and to attract and retain talent, here.

Perhaps we shouldn’t be surprised that the new fund hasn’t received that much media attention. It isn’t necessarily a stealth revelation, but certainly it is quietly underplayed.

For those local companies looking to ramp up through new capital though, the new fund will certainly be dead-centre on their radars.

And best of all, it doesn’t just come with money, it also comes with considerable knowhow.

P.S. – It would’ve been good from a stimulating interest in high-tech POV if The Punakaiki Fund had got off the ground. I like the no sour grapes attitude of its promoter/founder Lance Wiggs in a blog here and here.


Plenty of traps along the way for pest eradicators Peter Kerr Oct 29

2 Comments

No one ever said that creating and perfecting a resetting, toxin free pest trap was going to be easy.

The guys at Goodnature would be the first to agree, but, 12,000 or so sold traps later, the Wellington company that kicked off in 2005 is still trucking, slowly getting bigger.

A sticK story 18 months ago outlined how three Victoria University design school mature students bootstrapped their way to developing two unique traps that use compressed CO2 to power the possum, rat and stoat killing piston that instantly kills the pest.

They’ve since grown to eight people, and are continuing to learn lessons and modify their systems.

Goodnature’s head of marketing and market development Stu Barr says the company still has a design-led philosophy (and, as what is an attract and assassinate system these traps look good).

Stu Barr

As is almost invariably the case when creating injection moulded componentry that is assembled into a final unit, Goodnature had a few teething troubles with its new A24 rat & stoat trap.

A24 rat & stoat trap

“We had to resolve some moulding and technical flaws,” says Barr. “The reliability wasn’t up to where we need it to be.” Those challenges have now been overcome.

What has particularly been the team’s focus are new, highly effective lures, which ideally last a long time.

“We’ve developed a new food-based rat lure and possum lure and now working on non-food based lures and different delivery mechanisms for them all,” says Barr.

“We’re also working on a few simple things that support the traps in the immediate future, and other big developments that will take us a few years to perfect.”

And while New Zealand is the home base for Goodnature, the market opportunity for its traps is global. This is in a world-wide environment that is tending to move away from pest poisoning as a control method.

A recent trial of an E2 trap (a renamed A24) in Indonesia showed the potency of its system.

In the first night of the trial the two traps each killed seven rats..

“Our Indonesian partners never get that sort of kill with conventional traps,” Barr says.

“In terms of marketing, that story is better than any brochure. What people realise pretty quickly is that they can set the trap just once and kill multiple pests.”


Making a green stand – literally and figuratively Peter Kerr Oct 22

No Comments

Flexibition's range of sustainable exhibition stand products

Flexibition’s range of sustainable exhibition stand products


Here’s an example of a simple idea being good, and a good idea being simple.

It’s also pretty green in the scheme of these things as well as being a “why didn’t I think of that.”

‘Flexibition’ is the brainchild of Wellington designer Juliet Cooke. (intouchdesign.co.nz)

She was showing what has been designed as a packaway exhibition system made from entirely sustainable materials at, somewhat appropriately, the GoGreen Expo in Wellington on October 12 & 13.

Flexibition is based on a lightweight bamboo framework and various fabric panels. These panels include recyclable polyester, jute (recycled coffee sacks) and recycled dacron sails.

Cooke’s got a background in designing for various types of display in exhibitions and museums and other tricky spaces, so is well aware of the collapsible aluminium stands that are readily available.

After a request from a couple of organic-oriented clients (Mary Kelleher of Handmade Stories, and Richard Bacon of Organic Boxes), Cooke perfected her initial two-panel design.

This packs into a 2.1m x 200mm diameter carry bag (jute of course!) weighing eight kilograms. It costs $1700 + GST, plus another $500 for printing. This compares to its aluminium/plastic poor relation which start at about $2100 + GST.

Upcoming developments include a single pop-up stand designed for airline travel which will probably cost less than the two-panel version.

Cooke is a 3D designer, specialising in exhibitions – and this often involves designing furniture, sometimes of a pack down variety for touring shows. Part of her sustainable product repertoire is a collapsible seat, using simple panels held together by rubber straps. This is all the better to allow exhibition-goers a green seating option, with the ultimate plan being to join these together to make various modular structures such as tables and a bench seat.

She says it isn’t worthwhile trying protect the intellectual property or design, but that there’s enough tricky elements in creating a sturdy simple structure that will make imitations difficult.

“The joining method is probably pretty easily imitated, but the supply of materials and craftsmanship for the stand is harder to come by,” she says. “I’m still investigating the viability of various methods of production for the box seat, including getting it made out of recycled material at Trash Palace [Wellington dump’s ‘treasure trove’], and helping to rehabilitate mental health patients. There’s a bit of social sustainability and saving material from the landfill.”

It is early days for a new side of Cooke’s enterprise with the stand being about 12 months in development, and the box seat a much more recent addition to the Flexibition range.

“I’ve got other sustainable product ideas up my sleeve, including a collapsible vase that can fit in a car for funeral flower arrangements,” she says. “Of course though, all this has to be juggled with museum exhibition design contracts and my family’s needs.”


Network-wide options by YD - Freelance Wordpress Developer