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Building communities of success in Growth Town

19 June 2009

Who and what is driving the Growth Town concept? A collaborative network of entrepreneurs, investors and start-up veterans.

A few weeks ago I was part of a group of entrepreneurs and executives that got together to talk about issues and obstacles confronting the Australian early stage technology market.  The centre of the conversation revolved around support mechanisms for technology firms in Sydney and more broadly Australia and how to create and foster more innovation and entrepreneurship.

We wanted to focus our attention on one key area, where we felt we could actually make a difference - companies that were somewhere between seed and series A.  They had a product/service, a couple of clients, but were finding it difficult to establish themselves.  The result was the creation of Growth Town, http://www.startup-australia.org/growth-town

The consensus of the group was that there is an absence of support networks to encourage, mentor and assist young entrepreneurs as they transcend the boundaries from concept, to product, to business and beyond. The handful of people who attended this first glamourous, invitation only, pizza event @ the MitchelLake Sydney office had all worked and spent time in San Francisco with either Australian or US backed technology ventures.  Our focus on contrasting and comparing the differences between San Francisco and Sydney led to two key issues emerging from the discussion. Three weeks later over 90 people attended the follow up session.

Firstly, Australia tends not to easily recognise and leverage the skills and experiences of previously successful entrepreneurs – tech or otherwise. Apart from those few who exit or capitalise in a very public way, most tend to fly under the radar. While that isn’t necessarily a major issue in isolation, my feeling is that as a business community we are missing the opportunity to make use of hard lessons already learnt. In identifying the pitfalls and opportunities associated with international expansion, rapid growth, funding, partnerships, suppliers and established networks. 

I frequently attend a broad range of events, where the majority of speakers derive from Corporate Australia.  Where are our entrepreneurs?  If and when they come back to Australian we too often let them slip through our fingers.   David Cannington who helped found http://www.anzatechnet.com/  and http://thevalleybeat.squarespace.com has been running Australian entrepreneur events in San Francisco for over a decade.  Late last year David ran a dinner for Australian Founder CEO’s who were in San Francisco. Within a few days of notifying his network he had to cap attendance as he received over 60 RSVP’s (100’s more enquiries followed for future events). Most people are generally surprised that there are so many early stage Australian entrepreneurs active in the US. Why are we not better at identifying, tracking and collaborating with our entrepreneurs to help us more effectively capitalise and mature innovative ideas?

Secondly, our venture industry is limited in its ability to help foster and grow innovation and entrepreneurialism.   The perception is that Australia is a relatively small market where the scale of potential returns places downward pressure on Investor appetite for risk. This ensures that capital raising for technology & ideas in Australian from established super funds, private equity and government is generally limited.  This limited capital is typically focused on more mature if not already successful businesses in order to obtain a return for investors. 

Many of Australia’s technology focused VC’s are currently unable to raise follow on funds, leaving them to care for their existing portfolio, making no new investments. This combined with a lack of clearly defined angel networks, especially with a technology focus, means there is to little investment and often the wrong people investing into the wrong ventures.   A wise man once told me about investors, “if their just bringing money, then turn them down.  Money without networks, understanding and experience is dum money”. Whilst we all appreciate Sydney will never become Silicon Valley, we can still go a much further in terms of cutting our a unique space for ourselves to leverage great ideas into the global technology landscape.  

What Growth Town seeks to provide is a platform where people can listen to, learn from and engage with others who have experience that resonates to their own.  That is either, people who have taken concepts and ideas and grown from a couple of clients into an established and functioning business or, individuals who have built/sold intellectual property. Growth Town provides and supports an environment where people who want to give back, support the further expansion of the Australian technology market.  Who are these people who are giving back, what do they look like and why would they consider giving their time and effort to something which doesn’t provide them an immediate return.

I was sitting at TechCrunch50, www.techcrunch.com last year and distinctly remember one of the questions asked by the crowd to one of the key panels.  The panel was made up of Roelof Botha, Ron Conway, Mark Cuban, Tim O’Reilly, and Ram Shriram all of whom’s personal earnings exceed most the funds managed by Tech VC's in Australia.  A good question raised was “why the hell are you here and not on a yacht in the Caribeaan”.  The answer, even better than the question,  “we're here, because this is what we love doing, working with entrepreneurs, changing  the world!”.  It might be San Francisco itself that breads a climate of passion and entrepreneurship, but I don’t think so.  They believe they can change the world and they have. 

Companies like eBay, Google, Twitter and Facebook have changed the way we interact and do business, all within a decade.  Unfortunately we generally seem to miss the big picture and question our own abilities, due to a lack of what I like to call, “Start-up Veterans”.  SUV's are the people who tell you, “dream bigger”, “you can do this” and “the only one stopping you, is you”.  The reason you believe them is, they have done it.  People like founder of ResMed, Peter Farrell, Graeme Wood from Wotif, Paul McCarney from Decide Interactive, Ben Keighran from Bluepulse  Matt Symons from Memetrics and many, many more.  But why don’t we hear more about them, why don’t we have an Australian TechCrunch, with these guys sitting on the panel?  Where is the list of Australian entrepreneurs who we can aspire to?  Why don’t we tap into the Australians living in San Francisco and other major markets to help provide us with direction, insights and inspiration on how we can change the world? 

Well, we are trying to. Growth Town is part of this aspiration. It is happening now and it is up to all of us to invest our time, energy and belief in making it happen.    It’s a movement, a wave of people who have said we must change the way we operate in order to foster innovation and entrepreneurship in this country. And I see it happening more and more every day.  It is not only the governments’ role to do this. They can support, but they can not lead. Leading is the role of an entrepreneur or entrepreneurial executive.

We have angel networks (although non purely technology focused), local networking groups specifically around technology, such as Innovationbay www.innovationbay.com , Tech Nation: http://www.technation.com.au/ , Sydney Open Coffee www.meetup.com/open-coffee-sydney/ , Anthill , SlatteryiWatch, AMIA, Mobile Mondays, Sweedish Beers, ANZAtech, Sydney Angels and a range of others. What we lack is a layer of support, mentoring and in general people who can share experience advice to entrepreneurs and help them network with the right people.   I have generally found that companies find it hard to understand entrepreneurs.  Australians are commercially conservative by nature and find it difficult to accept the value of failure, which is an intrinsic part of being an entrepreneur.   In the US, many venture firms look to executives who have experienced both failure and success, as key advisors.   We fail to appreciate that failure is a sign of experience and something to be valued. We fail to engage successful entrepreneurs back into a support framework in which to assist new ventures and encourage entrepreneurship.  At a recent Growth Town, we asked attendees to talk about their most significant failures in the group.  I’ve never seen that done before in Australia.

If you have a story to tell, experiences to share and has a passion for fostering innovation and entrepreneurship in Australia, then you should be part of to the next Growth Town, www.startup-australia.org/growth-town

Phaedon Stough – MitchelLake, Managing Partner, Technology & Comercialisation Phaedon is Co-founder and Director of MitchelLake. He has over twelve years experience in Executive Search & Specialist Recruitment and has previously held consulting positions with Mills Harding and Nicholson International (London), Phaedon is a Founding partner – Innovation Bay & Growth Town venture networks.

Written by: Phaedon Stough

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