Why didn't I think of that?
By Matthew Benns
Universities are renowned for hot-housing ideas but not always necessarily for fusing them with business. In the digital age, however, old habits are changing fast, as Sydney’s new Student Union technology start-up project has demonstrated.
Last summer eight start-up student projects were selected to be in the inaugural INCUBATE start-up program, which was designed to stimulate student innovation and entrepreneurship.
The project has already paid dividends for one of the start-ups, which has attracted over $1 million in investment. Not bad for a bright idea and just a fraction of what INCUBATE co-founder James Alexander expects start-up businesses in the fledgling entrepreneurial scheme to generate in the future. “We started INCUBATE last year because we saw a gap in the way all universities were encouraging people to go out and start up new businesses,” says James. “The attitude was very much skewed towards joining an existing enterprise rather than looking at creating something from scratch and thinking about how many jobs you could create.”
He was inspired by an internship with Sydney software developer Atlassian, a global company that was founded by two former University of NSW graduates in their garage. “We are seeing changes that make starting a business faster and more affordable than ever before,” he adds.
These rapid advances in affordable technology, which made starting a business more accessible, prompted James and co-founder Mina Nada to start the INCUBATE program with the backing of the USU. The scheme selects the best eight ideas from the dozens submitted and then provides those eight with co-working space on campus in the Student Union offices, a $5000 seed funding grant and business mentoring from Sydney alumni. “The deadline of just 11 weeks before they have to pitch to the public is pretty scary and really concentrates their minds.”
The inaugural summer cycle concluded with a Demo Day in which the young entrepreneurs pitched their businesses to a room full of investors, industry representatives and the university community. INCUBATE mentor and Sydney alumnus Matt Barrie, the CEO of Freelancer.com, watched and guided as the business ideas developed.
“Interest in the program was huge, and certainly the transformation in the teams participating over the summer was incredible to watch,” he said. “The presentations at Demo Day (in March) frankly blew the roof off. The quality of some of these teams was superior, in my opinion, to the very best that you would see come out of an start-up incubator like Y Combinator in the USA.”
Whitney Komor’s idea for a social planning tool called The Best Day attracted over $1 million in funding at the end of 2012. The concept aims to make it easy for groups to make a plan of where and when to meet up without constant messaging. Businesses are assisted because The Best Day provides a PLAN widget that allows customers to organise and pay for group bookings. “We have several major Australian business partners already on board for our launch. Businesses want to make it easy for their customers to organise group bookings so we have developed a simple plan widget that a partner can add to their site so their customers can instantly put their plans into action,” says Whitney, who now has four employees.
She attracted half of her capital from Sydney Angels, a group of start-up entrepreneurs, and half from Australian venture-capital firm OneVentures. But despite her success, the venture capital industry in Australia still has a long way to go. In an interview with the Sydney Morning Herald, Matt Barrie said Australia’s venture capital industry was in “dire straits”. The amount of funding had halved to just $40 million in 2012 despite the country being in “the middle of the greatest technology boom of our time”.
Despite this, the INCUBATE entrepreneurs behind SnapDisco rejected $50,000 in investment because they were confident they could sell the product from the ground up and did not want to dilute their equity in the project.
The big ideas
Co-founder James Boyden entered INCUBATE with a great idea and leading-edge computer vision technology. The technology allowed customers to remove photographic backgrounds from their product shots without the time-consuming manual process of ‘clipping’ around a picture. “Great pictures mean great sales,” he explains.
It was a great idea but it was the mentoring that they received during their INCUBATE internship that allowed SnapDisco to take off and leave its founders confident enough to knock back investors. “We were accepted into INCUBATE with some cutting-edge technology and big ideas, but the customers just weren’t buying. The mentors helped us find our product-market fit, and we now have customers waiting to buy our product,” said James.
Georgia Kia received $20,000 in funding from Research in Motion and her pitch to Blackberry was so impressive that her app, WeSit, will be part of the official Blackberry 10 launch and feature on the Blackberry app store. Her idea was inspired from her job as a babysitter. She saw first-hand the anguish parents went through to find a trusted sitter when their regular person was unavailable. She hatched the idea of leveraging the trusted networks of babysitters through an online referral system.
Alexander Stamp founded CloudHerd as an online livestock management and sales platform and recently attracted $10,000 ‘proof-of-concept’ investment funding from a major bank. “The idea is to remove inefficient sale methods, wasted energy in transportation and the spread of diseases by creating a global marketplace for the livestock industry,” he says.
The presentations at Demo Day frankly blew the roof off. The quality was superior to what you would see come out of (an equivalent) in the USA.
Investors are also talking to the six members of the Edisse team. CEO Nicholas Tong explains the concept. “This is a watch made for the elderly that is designed to give peace of mind to carers. Current systems rely on a panic button which requires the user to be conscious to raise the alarm. Our watch detects a fall and automatically tells the carer that there has been a fall and where the person is.”
The six members of the team have successfully created the hardware and software of the prototype and are looking at growing a global market with a product that will ultimately save lives. Photo-sharing platform Muro has also attracted investor interest.
Computer Science undergraduate James Peter-Cooper Stanbury created an elastic social network that allows people to share photographs instantly. The idea is that people hosting an event – such as a party or a wedding – can register with the app and then guests can download and share pictures instantly. Two weeks after its public launch, Muro had over 700 Apple Store downloads.
The team at Weaver used their technical skills to create an interactive toy for children using sensors, robotics and artificial intelligence. Weaver CEO Fernando Vega says: “Programming is often seen as boring and demotivating, yet it is essential for students to learn in our modern world. We believe we can teach engineering principles and programming through an engaging toy robot.”
Mentor and Head of Commercialisation at The University of Sydney, Randal Leeb-du Toit, attended Demo Day and said afterwards: “On all counts, as a pilot, INCUBATE has exceeded my expectations. There’s no need to go all the way to Silicon Valley to find world-class technologists and aspirant entrepreneurs – they are right here in Sydney and on campus.”
INCUBATE is currently looking for leading alumni who are interested in supporting this innovative program, either as mentors for entrepreneurs or as program supporter.