Great discussion. My very late and loopy thoughts. It should be for-profit. Micro-finance works because it is a loan not a donation.
Seriously forget about VC's. If they knock on your door, great, but otherwise, just do what every you can to build your business. I guy I saw talk last night gave the order of investment from smallest to biggest like this; FFF - family friends and fools. Angel - generally people in your network (or the network you make) who have made it rich and get excited by your enthusiasm. Incubator - if they are around. Gov grant - good once you're going. Often dollar for dollar matching. Prof. Investor - like an angel who acts more like a VC. Bank - seriously. If you're making money, you can go to a bank. VC - note, that this is below banks. So if you think the bank wouldn't lend you money, then VC's probably won't either. Priv equity - like roving gangs of professional investors with management. IPO - remember those? Buyout funds - mega big boys. I've come to realise that most good businesses, that make money and bring wealth to the founders are fairly boring, behind the scenes, unknown brands. Because we see Youtubes, Skypes, Googles, Dodgeballs, MyBlogLog that's how we come up with ideas and follow the path. I know I did. But it really doesn't happen often. I agree that VC's are the most visible, and that's what we hear funds the big wins, but they are just the ones we hear about. I also agree that angels are not visible, but I'm not sure I'd want to be visible either. I'm sort of seeing building the big home run hit consumer startup is like trying to be U2. If you love being an entrepreneur, then you love creating businesses (music), getting customers (fans) and doing it year in year out (touring?). (more raving...) That being said, if you're passionate and have built a good foundation, or done lots of lots of lots of lots of research, then you might just be able to find someone to invest in you (not your business). I reckon it takes about 100 cups of coffee. The first 50 to tell a good story and the next 50 to find the person who gets turned on by that story and has the $$$ to take a bet. Feel free to ask me for that cup of coffee. I'm certainly no guru, and I don't have millions to invest but I certainly have failed an awful lot, so perhaps I act more as a warning to others? :-) Back to Pollenating. On Feb 5, 10:18 pm, silky <michaelsli...@gmail.com> wrote: > On Thu, Feb 5, 2009 at 9:28 PM, David Jones <david.jo...@gmail.com> wrote: > > I had come to the conclusion that a community driven y-combinator model was > > the best in the context of this country and investor ecosystem, so to see > > the conversation evolve to this is pretty exciting for me. So for fun I will > > call this ScuBinator (a very poor pun on silicon beach and incubation). > > > I don't know but, I suspect a few barriers exist to investor-eco-system > > health (thinking of angels mostly here): > > a) its a high probability that high networths made their money in property, > > retail or stocks - so early tech is daunting > > b) they've not heard of VCs hitting it out of the park > > c) there are only a handful of high networths who have made excess cash OZ. > > In the bay there is loads. As said previously its a cycle > > d) maybe angel community can't clearly reference enough successes. Its > > pretty sad if radiata, looksmart and resmed are the only reference points > > that broader investors take away. There are other startup that are great > > stories such as aconex, hitwise, atlassian and smaller but still great > > decide interactive, omnisio and probably 20 others that ScuBinator should be > > marketing as Australian successes. > > e) investment can be adversarial and so entrpreneur naivity has been > > perpetuated > > f) there has been not been an "easy to find" filter or mentoring vehicle and > > I feel SB could ultimately deliver that. > > > There has been y-combinator me-toos spring up and that is because its a good > > model:http://seedfunding.weebly.com/ > > I was having beers with YC company omnisio about 9months before youtube/goog > > acquired them, they loved being YC even though others told they could get > > much better terms - why? > > > they had to compete to be a YC company - they had to kick butt to be > > selected > > the YC events have profile and a marketing machine precedes them. This gold > > rubs off on YC winners - its up to them to what they make of it > > being a YC company puts you on a networking fast track - you meet and get > > mentored those who have been before. > > being a YC company increases a chance of exit because the "network behind > > the network" is very high value > > > So, can ScuBinator deliver such things to local startups? > > > yep, thats easy > > yes, taking startupcamp as a recent "outcome-focussed" example: I think a > > YC-style competition will deliver a much more focussed, quality and outcome > > related set of contenders than a Pitchfest style. If run twice per year, > > then startups can decide if it is too early to expose their secret sauce of > > business model. > > Collectively we SB folk may have 1 or 2 degree network that could credibly > > deliver this > > thats tough > > > I respectfully disagree with silky - I think it should be "for-profit". I > > think the mission is to make money and grow as a pragmatic, focussed > > incubator - to introduce non-profit dilutes focus of why it invest in a > > company. > > Not really; the non-profit part only speaks to the fact that the > people involved - the board - aren't doing it for themselves only; > they're doing it for the companies themselves, and the members. Like a > industry super fund. > > As I see it, the board would be filled with people who do other > things. Being involved in this organisation is only a side interest; > it's not a full time money-making scheme, it's a plan to help grow > businesses and the community in general. > > > > > The Oz startup scene is on the bottom of the Maslow hierarchy, so > > it can come back and be all-Omidyar after it has a track record of wins. My > > guess is that winners would be obliged to accept a term-sheet up-front (a > > condition of entry) for ScuBinator to have an COMMON STOCK equity stake or > > convertible note. > > > To me ScuBinator looks like: > > - a fund raising engine. It takes the Obama approach to fund raising, a > > little from a lot of people....often. > > - a unit trust (I am no accountant but I think ASIC has shareholder limits > > of 50, so the vehicle needs to be sorted) > > - it may segment the trust into streams or market specialties > > - a mentor hive > > - a selection team (who set the criteria for competition/selection) > > - an incubator that helps with corp structure, finance, grant management, > > raising, governence > > - an filter/advisor for startups that can't win, can't compete, are > > preparing > > - a buzz machine (to market the value of itself) > > - a communication arm to unit trust holders. One of the hardest things in > > terms of taking investment is the reporting regime. With friends/family > > rounds this can more emotional and high maintenance than originally > > intended. > > > this is not to say the cash-is-king comments are invalid, quite the > > opposite, I just think this is missing in OZ and we need to fix it. > > > anyway, just some thoughts. > > d. > > -- > noon silkyhttp://www.boxofgoodfeelings.com/ --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Silicon Beach Australia mailing list. No lurkers! It is expected that you introduce yourself: http://groups.google.com/group/silicon-beach-australia/browse_thread/thread/99938a0fbc691eeb To post to this group, send email to silicon-beach-australia@googlegroups.com To unsubscribe from this group, send email to silicon-beach-australia+unsubscr...@googlegroups.com For more options, visit this group at http://groups.google.com/group/silicon-beach-australia?hl=en?hl=en -~----------~----~----~----~------~----~------~--~---
