Interview of Danish Serial Entrepreneur Martin Thorborg by David Brown

Last week we had the pleasure of interviewing Danish serial entrepreneur Martin Thorborg. Martin is an accomplished writer, blogger, speaker and co-founder of SPAMfighter (as well as a couple of others).  He currently lives in the US and is on a six month trip interviewing Danish entrepreneurs across the USA. During this interview Martin and David discuss some of the challenges Danish, Australian and American entrepreneurs face, review some of the issues Danish and European start ups deal with (Danish companies must be born international to survive) and what is similar between all three countries entrepreneurs. They also go into what is happening with Silicon Valley, whether a start up should immediately move to Palo Alto or stay with their base, use their home connections and build critical mass first.

It is a wide ranging interview covering many of the issues Startups all over the world face. It is a three part series starting with this segment, part one: http://youtu.be/BI2f2d76VKo

Australian Tech Start ups expanding with US Venture Capital Increasing

Just read an interesting article in the Australian Age http://www.theage.com.au regarding investment in Australia by US Venture Capital. The only VC I’m aware that has offices in Silicon Valley and Australia is Southern Cross run by John Scull, Larry Marshall & Tristen Langley.

One of the tenants of the article is that Start-ups don’t need to move to the US to succeed. My feeling on that one is that is true initially but in order to grow they will need to have office(s) in the US in order to access the market just like they always have. The other interesting note was the authors idea that many US start ups were over valued and therefore Australian start ups were more attractive. I don’t know if that is actually the case but in my experience the big hitters Sequia, DFJ, Kleiner Perkins etc., have always been willing to look at Australian companies as long as they have a disruptive idea and they are properly prepared and introduced. http://www.theage.com.au/technology/technology-news/aussie-tech-gold-rush-nothing-off-limits-20111103-1mwyn.html

Australian Innovation Showcase

I attended last night’s ANZA Technology Network kickoff to the “Gateway to US Executive Summit” at Silicon Valley Bank last night and I think Viki Forrest may have put forth one of her best programs to date.

The companies that attended this year were:  8 Shot International, Australian Survey Research, Aviator, Evanscorp, iAsset, inference Communications, Jasondb, Red Lizard Software and X-Ped.  Mick Johnson Whereoscope and Bardia Housman Business Catalyst (both of whom we interviewed previously) were also there as guest speakers.  Whereoscope looks pretty interesting as it is focused on using an iPhone App to find out where your kids are.  Putting the obvious big brother implications aside and being a parent myself I’m confident there is a market for it, if it is properly positioned and marketed.

The speech by Andrew Lacy (Tapulous / now owned by Walt Disney) was especially entertaining as he provided the entrepreneurial audience with some sage advice (at least from my perspective).  He didn’t come out and say this but the theme was don’t let your business plan get in the way of success.  Tapulous’s business plan was not focused on “Tap Tap” but Andrew saw an opportunity when an Engineer / inventor he was looking at hiring came in and although he knew he wouldn’t be a good fit as an employee, he bought the App and 40 million downloads later he “guessed” right.  The other item he brought up which I also though was prescient was the element of luck.

Many times you have the right idea but the timing is wrong, the team is wrong or something just doesn’t click the way it should.  In his case the App was a bit of luck and Disney coming in was also lucky as they were looking to raise capital rather than “exit”.  Having created a site for selling photography back in the late 90’s I completely get the timing thing as I had the right “idea” but it was too soon, (internet speed for most consumers, was not ready for buying photo’s on line).  Today there are many successful photography sites; RedBubble, Art.com etc.,.

The other take away I had was savvy.  For many CEO’s it is much easier to stay the course than to jump on something in midstream, especially when you’re playing with Venture Capitalist money.  The VC’s bought into Andrew’s idea (meaning the CEO “sold it” ) and the rest is a bit of Aussie history.

My take away from last night was “don’t let a business plan get in the way of success”!

Angel / VC Investment Patterns Changing?

I was reviewing a linked in email today from LinkSV and noticed a new profile for http://www.milo.com/ which is another site enabling shoppers to research stores, best buys and purchase locally.  That in and of itself was interesting but what was really interesting was the investors.  Traditionally in a $4.0m raise you would generally see 1 or 2 VC’s that would be in the investment to ensure they had good leverage and would not unnecessarily dilute their equity position.  However, in this case there were over a dozen investors from the Wharton School, to Angels to standard VC’s.  A fairly eclectic mix to what we would normally see in a social marketing venture.

So this begs the question, is there a new trend starting where the inside Angels are looking to get into bigger rounds with smaller chunks of capital replacing the traditional VC model?  Stay tuned this maybe worth watching.

Interview with Jennifer Wolfe CEO DaRiMi Kidz by David Brown CEO IMES

Jennifer Wolfe CEO DaRiMi Kidz & David Brown CEO IMES

Darimi Kidz CEO Jennifer Wolfe joins us for a two part interview to talk about their children’s swimwear line Sun Busters. This is a very interesting company with Co American and Australian CEO’s operating out of California and Sydney. Their products are worn by the kids of some of the entertainment world’s biggest stars like Angelina Jolie / Brad Pitt, Gwyneth Paltrow and have been given the Skin Cancer Foundation seal of approval.

Their business premise is straight forward. Take the best of the Australian beach culture worldwide via fun styles and patterns that both kids and parents can appreciate. In addition to the products good looks and durability its sun protection is based on the weave of the fabric rather than sprayed on chemicals making it more durable and safer than most of their competitors. Having two Mom CEO’s working in two different continents seems like a big challenge! However, listen to the interview and find out how they have overcome the tyranny of distance and made Darimi Kidz a successful international brand worth watching.

See this new CEO interview at http://imes-davidbrown.blogspot.com/

Interview 5th Finger CEO Patrick Collins by David Brown CEO IMES

5th Finger CEO Patrick Collins joins us for an intriguing look at an Australian success turned into a North American startup! 5th Finger is a very successful Australian Mobile Marketing company that has successfully completed over 5,000 mobile marketing campaigns. Back in 2007 they were looking for a new challenge and picked the US. They successfully raised $7 million from Starfish Venture Capital in Melbourne, Australia and moved 25 Aussies to the states.

Patrick provides us with a great perspective on how some of the worlds largest soda manufacturers and Lingerie companies utilize 5th Finger’s mobile marketing platform to reach new customers in an extremely challenging market environment. He also talks a bit about the future of mobile marketing campaigns and how his company has repositioned itself from a tech company to a mobile marketing / advertising powerhouse.   Go to www.imes-davidbrown.blogspot.com for the video.

Jam-Code CEO Mick Johnson interviewed by David Brown CEO IMES

Check out the video interview @ http://www.imes-davidbrown.blogspot.com/

Australian Fire Fighters

Jam-Code just released Gasbag Pro & 2.0 on February 10th and they have already seen significant sales uptake! Mick Johnson their CEO talks to us about their next iPhone App My ATM and why they think their knowledge of Crowd Source Data in the mobile market sets Jam-Code apart. He also talks about his contrarian market approach whereby they have accelerated their marketing and product development efforts while many competitors are to afraid to do anything. He equates this to the Warren Buffet approach of going against the herd to maximise profits.

We would also like to mention our friends in Victoria who have suffered through the recent bushfire tragedy. We would like them to know that we’re thinking of them and encourage our viewers to help if they can http://www.redcross.org.au/.

Do I need a Market Entry Strategy?

If its time for your company to expand internationally or if you’re already international and looking at new countries to enter, the answer is yes! As entrepreneurs know from starting their businesses there are always things that pop up that they did not anticipate or plan for. Developing a strategy reduces uncertainty by committing to paper what you know, what you think you will do and how you will do it. Many people “know” what they are going to do but when asked to write it down they often find it challenging. By taking the time to write an entry plan (and utilizing a solid plan template) it forces them to think through all the steps they need to take and make sure they have covered as many elements as possible as well as put the right resources in place.

The other advantage of writing a plan is to obtain outside perspective or guidance. Entrepreneurs often get wrapped up in day to day operations and are challenged to step up and look at the big picture. By soliciting experienced external assistance the CEO can have someone look at their company without the rose colored glasses we often wear and make suggestions / recommendations which may have been over looked. This will often challenge the CEO’s thinking and lead to a better overall strategy. Generally speaking an experienced operator in your vertical is your best bet. If you can get them to help you for free great, if not find a consultant that does this for a living and map out what they will deliver and what you will do to develop your plan.

If a CEO chooses not to do the upfront market research and develop a coherent entry strategy, the best case scenario is a bit of floundering and squandering of valuable time and resources (something most small businesses can ill afford). Worst case scenario is an entry failure or even more disastrous the development of a brand error which could haunt any future re-entry endeavors.

The bottom line is that by investing your time and energy in a market entry strategy before you start marketeting / selling, you will reduce entry uncertainty, be more confident you have the right plan and ultimately greatly increase your chances of success in your chosen market.

Bury your head in the Sand, Or Hit the Gas Selectively?

So much doom & gloom has been written about how to run a business in a recession I thought I would pose a contrarian perspective to see what other bloggers / readers were thinking.

Everyone in Silicon Valley is now familiar with the “PowerPoint” that Sequoia Capital www.sequoiacap.com sent out last month. They were the buzz of Silicon Valley when they invited their portfolio entrepreneurs & CEOs into a meeting and greeted them with an image of a tombstone that said “RIP Good Times”. The premise of the meeting was to cut costs immediately and figure out how to survive and successfully emerge on the other side of what they predicted would be a long downturn. From a historical perspective they also had a similar all hands on deck meeting before the last downturn.

Sequoia’s speakers (including Uber-investor Mike Moritz) told the Financial Times www.ft.com/home/us “It’s pretty clear that demand is going to soften across the board for every company – it doesn’t matter if you’re selling to consumers or companies.” They went through each functional area and showed their investees how they could/should cut costs to decrease their burn rate and increase their survivability in an extended down turn.

Now, as a fellow entrepreneur I’m very familiar with the need to extend your burn rate and believe that some cost cutting is in order in downturns. However, I take a different tact than many when it comes to marketing. When most companies and people are burying their heads in the sand I believe it’s the best time to get going and create some head wind for your company! Your marketing / advertising efforts will get more bang for your buck because there is less competition for head space. Your dollars will go farther and marketing / advertising is cheaper because they’re happy for any new business they can get. Last, this is the time to gain market share on your competitors and strike while they’re scared and sitting around wondering what to do because “the sky is falling”, we better not do anything and just wait it out. Your more experienced Angels/VC’s get that and the ones who do usually get the best valuations / long term deals because they kept at it during a downturn but became more focused and used their marketing budget proactively. However, we all know it is much easier to be a sheep than strike out (especially in Australia w/the tall Popeye syndrome!) and hit the gas judiciously.To my mind, more entrepreneurs should take the contrarian Warren Buffet approach and when all the sheep are headed to the pens go out in the field and look at this time as an opportunity to take advantage of, rather than to run scared and miss out on an opportunity to position your company for the coming up turn!

Check out the American Marketing Associations survey www.marketingpower.com for more information on this topic.

“Actionable Market Research”

I’m often asked why a company should invest in market research before they enter a new market. I sometimes ask them; did you do any research before you bought a car? How about your house? Heck most of us even research different cell phones and service provider plans. So it often baffles me why it seems so unusual to research an entirely new market before you enter it. Most entrepreneurs only have enough capital to do it right the first time or they’re out of money/time packing it in and wondering what they did wrong.

From a market entry consultant’s perspective market research such as country demographics are nice to have but not really something we recommend paying for since its readily available at places like http://www.fedstats.gov/ . What we often recommend is allocating a budget for what I call “Actionable Market Research”. This includes a range of research dependent on the client’s current knowledge base and management team but often contains competitor research such as how are they selling their product or service (channel strategy) and how are they pricing / distributing it, how do they compare to you? It should also look at potential customers – what does your potential client look like, what are the potential changeover costs and why is your product better, cheaper or faster than your competitors? Another area that is often forgotten is influencers i.e., who will your end customer go to in order to research your competitors or you and who tracks companies in your space. This isn’t just the Gartners http://www.gartner.com/ or Aberdeen’s http://www.aberdeen.com/ it also includes bloggers, hard copy and soft copy magazines.

There is much more involved in developing a really strong market research project but at the end of the day your market research should reduce market uncertainties, give you a good window into whether you should even enter the market and give you the base information required to develop your market entry strategy. That is why quality actionable market research is so valuable to a successful entry and should be part of any new market entry budget.