Going Global while keeping it local – Start-up superstars building a home ground advantage

Last week, Innovation Bay, which provides a networking platform for innovation and investment in the high-tech space across Australia, held its regular breakfast event in Sydney, hosted by Ian Gardiner. As a national sponsor, we attended this event which featured inspirational talks from home grown start-up superstars – Luke Anear of SafetyCulture & Scott Farquhar of Atlassian (Deloitte Tech Fast 50 7 times winner) on how they have managed to build successful global start-ups while maintaining their local roots – and what can be done to keep others like them in Australia.

Innovation Bay Breakfast event

This post is republished with kind permission and based on Innovation Bay’s original post on the event, which you can find here. Quotes and statistics are sourced from the original recording of the event which you can view here.

Who they are

Luke Anear, a former private investigator for workers’ compensation claims, founded SafetyCulture in Townsville in 2004. The business boomed in 2012 with the release of the iAuditor app which allows people to conduct safety inspections and audits from their smartphone.

According to Luke, since the app’s launch they have achieved incredible traction; boasting 10 million audits on their platform already, and being used more than 32,000 times a day in over 80 countries.

SafetyCulture recently raised $2.1 million in a funding round led by Scott Farquhar, this follows a previous round of $2.35 million in 2013, where Scott invested through Blackbird Ventures.

A customer centric approach to marketing

Scott has found much of Atlassian’s success can be contributed to some careful choices made in the early days that are still helping the business today. In terms of marketing, Atlassian were pioneers in the use of AdWords. However these days Scott believes word of mouth is a more effective marketing tool.

Luke admits he has focussed more on developing the product rather than investing in marketing. He concedes they have done a ‘pretty ordinary job in marketing’ but has found more success focusing on building a great product early on and empowering people on the front line, such as his customer success team, to keep clients happy and coming back. His most successful strategy for attracting new members to the site has been word of mouth referrals at 49%. ‘When we have 80,000 people using the app every other day without sales and marketing, then it’s the product itself that pulls people in, we were lucky to get some great reviews on the app store early on’.

Both agree that the quality of the people and product are the keys to start-up success. It’s an observation that Scott believes is true of most leading start-ups: ‘if you look at the top apps in each category, most are there because they really are the best app. People will search out a solution through word of mouth’. For larger organisations, there may be a need for sales and marketing, but their main still focus should be on the people.

 Their global presence

With Luke based in Townsville, he believes technology is vital to having a global presence. ‘Leveraging the connectivity of the web is the key to growing fast. Part of our strategy is making it easier to work with other people’.

Luke has felt his biggest challenges in setting up in the US is the time zone differences while building a team out there

Scott has found having an on the ground leader who can create a great environment and build a strong culture is essential.

Though the organisations have achieved global success, they are both still headquartered in Australia.  Scott is keen to support developing Australian start-ups as part of his overall commitment to seeing the local market thrive. ’Right now you still need to import a lot of talent from overseas. We need to change the Australian system, starting with high school education, so we can develop our own talent right here.’

‘People don’t realise that success stories like Mathletics, which is the leading maths tuition platform globally, is Australian. We have the ability to do great things; it just needs a coordinated effort.’

Historically Australia hasn’t had the funds to support start-ups at the scale you see in Silicon Valley, so more funding has come from overseas, making it attractive to move and operate there. Scott believes that while it’s great to have a tech centre in Australia, if start-ups have to go overseas for funding, that’s a problem.

Venture Capitalists cutting bigger cheques in Australia means more start-ups are likely to stay here, creating more jobs. It also means Capital Gains Tax is paid in Australia. ‘If they do well and they’re funded from the US, then capital gain is directed to the US. In a world of intellectual property, there’s no definite place that made profit, so it’s based on the tax base’.

How government can have an impact

With a recent change in leadership, Scott and Luke both feel the Federal Government is taking some positive steps to help support the community, but there is still a long way to go.

Ian stated that ‘When you have a Prime Minister who has himself made money from an internet company, you do seem to get more belief in what our industry can achieve. There’s still a lot to be done, such as further simplifying the employee share scheme rules, but it’s been a positive change so far.’ Which both agree on.

To avoid the risk of other countries undercutting Australia in terms of attractiveness for start-ups, Scott believes that Innovation is the best defence. In addition, he advocates the need to focus on retaining talent and improving education. In his opinion, the new government appears to be proactive and the focus has changed. There appears to be a better appreciation for the ingredients that create a tech economy.

 Giving Back

Another way that the community here can thrive is through being collaborative and supportive. Giving back has been a core thread to both Scott and Luke’s motivations.

Scott explained: ‘We started the Atlassian Foundation before we were successful, and it’s been a really great model. Over $40 million has gone into the foundation so far.’

These incredible numbers can’t be achieved by everyone, but through Pledge, which Atlassian has founded in partnership with Salesforce, even the smallest start-up can contribute to the community. ‘We ask that they pledge just one per cent of equity, profits or employee time, and it can be directed to whatever cause they wish.’  Luke has signed up and believes that if enough investment is made locally, Australia has an incredible future, despite tax, talent and intellectual property challenges.

‘Innovation is the best defence. Fostering innovation is key.’

 

Innovation Bay provides a networking platform for innovation and investment in the high-tech space. Their members are innovators, business leaders and investors with an eye for new technology. They hold regular networking events and invite industry experts along to inspire new ways of thinking

 


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