Thanks for the post Renai. It's a good question and there are some
great answers here.
I'll summarise my point by saying yes and no.
Yes, there is a VC funding here in Australia.
No, it's not particularly relevant for early stage web businesses,
which a lot of Silicon Beach is about - or is that just me?
Matt's post is good as it shows where you need to be to be to get VC
funding.
So the whinging is whinging to some degree, as people read Techcrunch
and think that VC money is how you do things. It may appear that way
but in reality there is a a lot more companies in the valley that
don't get VC funding than do. They are bombarded each year by
thousands of companies from around the world and each VC may fund 3-5
each each year.
What we need to be looking at is more seed and angel funding. This is
partly why Pollenizer is structured the way we are. We can expect big
cash without a working business, so we find a little bit of cash, stay
lean and get to validation.
I've got no doubt the VC's in Australia will fund you - IF - you fit
their requirements and IF you want to take the money.
For some quick stats,
* Of the more than 100 business that Pollenizer has worked with and
more than 500 that we have spoken to, only 2 have been VC funded.
Xumii (mid-sized project) and Mig33 (tiny project).
* Of the $5m we have raised for our portfolio companies, none of it
has come from VC's. Yes, it's a young portfolio and I expect some in
the next few years will look to VC's for expansion capital, but many
won't need it.
The big part I agree with is the stop whinging and just do it. Ian
Cummings is a good example. He finds a way. It's hard, and requires
persistence - welcome to the job!
Mick
On Sep 14, 10:11 am, timparsons <tmpr...@gmail.com> wrote:
> Nice post Matt - and thank heavens for Silicon Beach too I say :-)
>
> On Sep 13, 8:26 pm, Matt <matt...@yuuwa.com.au> wrote:
>
>
>
> > Hi Renai
>
> > Thanks for the write up :)
>
> > I was trying to find another early stage VC-fund investment in IT in
> > the past 6 months and found it very difficult.
>
> > VC funding is not particularly sought after by typical web-based start-
> > ups these days for two key reasons:
>
> > 1. I look to invest $1.0 - 3.0m in a Series A round, most start-ups
> > these days can get to cashflow positive on a lot less and that's where
> > the average entrepreneur is happy to either stop thinking about extra
> > capital ("I am cashflow positive already") or start believing in
> > valuations that would mean my $1-3m would not give me any substantial
> > stake in the business.
>
> > 2. Our terms are very very tough compared to family and friends or
> > private equity or just about any other form of investment money. We
> > ensure very strong downside protection, which frankly is very off-
> > putting for many entrepreneurs
>
> > Read VentureHacks to get an idea where VC sits in the cycle, you can
> > get a lot from Angels if you can find them, but a VC is mean to help
> > propel a business to the next level and should bring a lot more than
> > cash. I have sat on both sides of the table, I don;t pretend for an
> > instant that I can bring the networks or skills of the average Silicon
> > Valley VC but from little ol' Perth I can certainly help a business go
> > international for the first time.
>
> > Agworld was an exception opportunity for us, great management, an
> > understanding of the value of VC and some great early traction with
> > customers built on the back of some serious sweat and real cash from
> > the founders. Hats off to them for seeing where Yuuwa could fit in
> > and giving us a chance
>
> > Matt
> > Co-founder
> > Yuuwa Capital LP
>
> > On Sep 13, 8:42 am, Renai LeMay <rle...@gmail.com> wrote:
>
> > > Innovation Bay is constantly calling for people to come and pitch to
> > > them, and now this drops out of the 'sky' -- or should that be the
> > > 'Yuuwa'? ;)
>
> > > Perth VC pumps $1.5m into agriculture IT
> > > startuphttp://delimiter.com.au/2010/09/13/perth-vc-pumps-1-5m-into-agricultu...
>
> > > I am beginning to suspect that the whinging about a lack of VC capital
> > > in Australia is just that ... whinging.
>
> > > Thoughts?
>
> > > Renai
> > > Publisher, Delimiter
>
> > > PS I am heading to the next Innovation Bay dinner -- will be
> > > interesting to see what the sentiment is on the issue there.
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