Next Mobile Opportunities

Vishal Thursday, August 28, 2008 , , , , 0 comments

This is a guest post by Rajesh Jain, an entrepreneur based in Mumbai, India, and Founder and Managing Director of Netcore Solutions Pvt Ltd. He has put together his thoughts for the emerging opportunities in Mobile domain especially focusing India. Lets explore what he has to say about this emerging platform and the opportunity:

The Shift from Internet 1 (Portals) to Internet 2 (Search)

The early days of the Internet were all eyeballs and monetisation via banner (graphical) advertising. The business was about creating portals and destination sites like Yahoo and AOL were doing. There was also some eCommerce going via the likes of eBay and Amazon. These were significant opportunities but they paled into what was created by Google with the simplicity of paid search. Of course, Google did not create the base model - that was done by Overture (GoTo.com) which was later acquired by Yahoo. But Google refined it to perfection. Search captures intent - to find or buy. Google first fixed the search content, by using the link structure of the Web with its PageRank algorithm. This made finding easy and brought Search back in vogue. It then used the keywords that users were searching for as the thing to sell ads on. On the ad front, it did three things: it used auctions to let the market set the pricing, it only charged base on the click (performance), and it created a self-service system for advertisers wanting to buy. All of this created an infinitely scalable, global solution. And an ecosystem of companies around it (the likes of SEO, SEM, etc.). Google did not need to worry about the demographics of its users - the pay-per-click model (as opposed to the impression-based graphical display model) automatically took care of appropriately matching the two parties. This basic system today will account for $30 billion in revenue, of which Google will take three-quarters - all of this has happened in the past 5-6 years. The graphical display advertising, which has been around for a decade, will account for $20 billion in revenue strewn across the rest of the hundred million Internet sites. So, the second version of monetisation on the Internet (paid search) overtook the first set of monetisation ideas (graphical display ads).

[We are now seeing the emergence of the next Internet - built around Social interactions and Media. The standard bearers for this next-generation are sites like YouTube, Facebook, Skype and PayPal. Widgets are also a powerful emerging force, as is Mobile. We will now shift focus to the mobile, because this is an area where India is one of the world leaders in its consumer base.]

So, the questions that come to mind are: What will be the dominant model on the mobile? What will create the $30 billion global market opportunity in the next five years?

For the purpose of this discussion, we will leave aside the existing VAS industry which is many billions of dollars in size - and covers ringtones, wallpapers, games, CRBT and music. This has been the biggest success outside of voice and P2P SMS. We want to look at those models where the user does not pay (much) - these models are likely to be equally big if not bigger than the VAS industry today. They will fall largely into three buckets - subscriptions, advertising and transactions (as do all possible revenue streams). User Pays is what the mobile industry has capitalised on very well with its inherent microbilling characteristics. The question for discussion is what else can be created beyond this VAS 1.0 business?

The mobile has many interaction channels - voice, SMS, MMS, mobile web, downloaded apps, and later, video/mobile TV. Of these, there are only two which work on every device - voice and SMS. We will focus on just these two. (In the future, it is possible for the mobile web to become the dominant interaction point - but even in Europe with its advanced networks, less than 20% of the mobile user base uses the mobile web.) So, the first point is that for ubiquity on the mobile, one needs to use voice and SMS.

The next point is: Pull or Push? Or put another way, Search or Something else? Search has succeeded big time on the PC, and so there is every reason to believe it should do well on the mobile also. My belief is that Search needs the mobile web - on SMS, the limitations are too many to make it work. Two chief ones: the cost of sending a premium SMS each time a search needs to be done, and the inability to always get an Answer that one is looking for. In countries like India, Search on mobile is probably better done via Voice where one can interactively fine-tune the requirement to get what is needed. (This is space where companies like JustDial in India are doing very well.) Pull-based Voice or SMS services will be limited due to their premium pricing, even though they can have mass appeal. This is where free incoming SMS will shine - and have the potential to be the next big thing.

In a way, we are already seeing free Push SMS - in the form of Spam. Users do not have the ability to opt-out, which creates frustration and leads users to start ignoring incoming SMSes from non-trusted sources. This brings us to the third point - on the mobile, it will have to be about Permission. As Seth Godin put it, “Mobile marketing demands Permission.”

So, taking the first three points together, we get the idea for the service: Permission-based SMS Subscription Services. This does not mean IVR (Voice), Search and P2A are not big. But there are inherent limitations which prevent the ideas from scaling. Free is a critical requirement for something to achieve mass numbers and scale. This is where SMS Subscriptions come in. The killer combination which gets over the limitations of SMS is SMS integrated with WAP and Voice (IVR / call centre).

Put another way, on the mobile, VAS 1.0 was all about generating revenues from consumers. In India, this is a billion dollar business. VAS 2.0 will be using Free SMS Subscriptions as the anchor for monetising the right of way to consumers in multiple different ways. What will be valuable in this case is the Subscriptions Engine. What Search did on the Internet Subscriptions will do on the Mobile - generate an audience and create revenue streams.

The World of Subscriptions: Creating Right of Way, and Combining Invertising and Advertising

Now, the next question is how big can this be? Or put another way, what can users Subscribe to? And what’s the business model?

Free Subscriptions can be of two types: Content subsidised by Ads, or Content as Ads. In the first scenario, content is what subscribers want, and advertisers pay to reach these users. This is Advertising. Content can be professionally created or user-generated. Professional content can be regular content (”dailies”) or event-driven (”alerts”). In the second case, there is only promotional information sent primarily by brands - and that is what subscribers want. Think of it as Invertising.

SMS Subscriptions don’t necessarily have to have all of the content in them - given the limitations of 160 chars, they cannot. Instead, for some of the messages, we need to think of them as Signals, or Triggers - which can get the subscriber to act. The action can be a click, response back via SMS, a phone call. And the response on the SMS can also be followed by a voice call. So, essentially, the SMS becomes the starting point for generating engagement (when it is required).

How big can SMS subscriptions be? My belief is that each of us can receive upto 10 SMS daily without feeling overwhelmed. 3-4 of them would be content, but the rest can be either community-related (UGC) or Invertising. Assuming there are 2-3 of each, there is potential to receive 60-90 Invertising SMSes each month. Assuming a single company sends about 3-4 SMS each month, a consumer can have relationships with about 20 brands, with each brand paying about 50 paise per user per month for the relationship, creating a market opportunity of Rs 10 per subscriber per month in India. Assuming that this can reach about 50 million subscribers (top 20% of the mobile user base as of now), this is a market opportunity of Rs 500 crore ($120 million) per annum - about the same size as the current Internet advertising market in India.

In the US, brands could pay about 25c for the same relationship, creating a $5 per subscriber per month opportunity. So, if we take these two extremes, between subscribers in developed markets (500 million) and emerging markets (1.5 billion), and assume a 20% penetration, the market opportunity is 100 million x $5 + 300 million x 25c = $500+75 = $575 million per month, or about $7 billion over a year. This is where Paid Search would have been about 3 years ago (2005 Paid Search: $9 billion).

Next question: will this happen? Mobiles are great for brands to build hotlines and relationships with consumers. Paid Search on the Net hasn’t worked as well for Brands, given the text-based ads and performance-based payouts. But, Invertising on mobiles could be just the solution that brands need (along with targeted Display Advertising on the Internet). For anyone with customers, the Invertising channel is a great way to stay connected - at a cost of no more than Rs 5 per year.

In addition, there is a significant advertising opportunity on the SMS content services. Assuming 3 subscriptions a person means an inventory of 100 SMS per month or about 1000 SMS a year. With a Rs 50 CPM and a 20% fill rate in India, the monthly opportunity for advertising is about Re 1. Besides advertising, there are other services which can be targeted to the consumer base (pull, email2sms, WAP, transactions, targeted ads, paid services, etc.). It should be possible to generate Rs 5 per consumer per month. This opportunity is thus half as big as the Invertising opportunity.

Thus, together, the Right of Way model can generate global revenues (in 2 years) equivalent to that of Paid Search in 2005. Put another way, the mobile monetisation (version 2: Subscriptions Right of Way) lags Internet monetisation (version 2: Paid Search) by 5 years.

Bio: Rajesh Jain is an entrepreneur from Mumbai, India. He is the Founder and Managing Director of Netcore Solutions Pvt Ltd (messaging and security solutions, and mobile data services), and have made a number of investments in various companies as part of his own fund (Emergic Venture Capital). He had earlier set up IndiaWorld, India’s first Internet portal which was launched in 1995, which was acquired by Sify in November 1999 for USD 115 million (then, Rs 499 crore). He blogs at Emergic.org

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SMS Poll - Mobile Text Message Voting Application

Vishal Wednesday, August 27, 2008 , , , , 8 comments

Today we showcase an exciting and a successful venture co-founded in 2008 by Ian McCallam from Sydney, NSW, Australia, SMS Poll - Mobile Text Message Voting Application.

In a recent email based interview with Ian, he gave insights into his venture and how he is progressing with it. This is what he has to say:

Please tell us about yourself, your background and interests?

Born, raised and graduated in London. I now live in Sydney.

I’ve always been a bit of an ‘inventor of ideas’ and when the Internet came along I knew I could put down my pencil and paper and start creating things in a new world where they would be seen by people across the world (rather than just my friends and next door neighbor!). I started my digital media career about 10 years ago at a London agency creating online solutions for a variety of blue chip clients. I spent my spare time writing about emerging trends on the web and across the world as one of the founding writers for PSFK.com.

I later went on to establish a music agency for three years and then moved to Sydney in 2004 to launch and manage the Australian office for a British entertainment company specialising in DRM.

2 years later after rolling out the digital sales channel for one of Australia’s largest music retailers, I went on to develop three online products in the Asian mobile arena.

Feeling the need to work on what I could class as my own project again and to have a taste of the Australian start up industry, I met up with Anil Sabharwal and soon we co-created RAYV and now we have launched SMS Poll.



• Please tell us about your venture/company?
SMS Poll is a sophisticated yet simple text message voting application that lets you poll your live audience to quickly and easily gather in-moment data and find out what they are really thinking.

It’s requires no special hardware or software and is a tenth of the price than traditional Audience Response Systems. It also eliminates some of the standard traits of ARS such as the requirement to pay for expensive technicians, pass out clickers and configuration of voting software.

SMS Poll works by allowing a poll organiser to quickly create, customise, and share his/her poll in PowerPoint or online. The audience votes by sending an SMS to a local phone number or by browsing to a mobile friendly webpage, and the results for the poll update in real-time, right before the audience’s eyes – using one of SMS Poll’s .swf charts. The poll organiser can then download the results for the poll into Excel for further analysis.

A live demonstration of SMS Poll can be seen here: www.smspoll.net/demo

We launched in July 2008 and we are currently available in Australia and the UK. We have plans to extend the service across a variety of other major countries in the coming months.

Who are the people behind this and how it started?
There’s Anil Sabharwal who is the Managing Director and I head up the Marketing and Product Development. We also have Philip McCauley who is our Head of Finance.

Clifford Rosenberg (Former MD of Yahoo! Aus & NZ. Founder of iTouch Australia) has recently joined us as an advisory board member.

SMS Poll actually came to fruition through a personal need. Anil and I run another Aussie start up called RAYV. A local UGC business review site. We were holding a fairly large awards night for the end of our marketing campaign and we wanted to let attendees vote on their favourite business review. And more so, we wanted them to be able to view the results (real-time) as they were received.

We just couldn’t find a suitable service in Australia that matched our needs. So, we decided to build it. With a bit more research into the market this looked like a great business opportunity and an innovative new tool for not only event planners, but also teachers, students, NFPs, market researchers or any other type of live audience organiser or participant.
We’re both idea geeks and this was another project / idea that really interested us once we saw the greater business potential. And so SMS Poll was born.


We just couldn't find a suitable service in Australia that matched our needs. There was (and still is) a brilliant service in the US by the name of Poll Everywhere, but it wasn't available here. We really liked what they were doing and decided to build a similar offering down under. It started off as more of a pet project to meet a single requirement, but immediately we got interest from other people who wanted to use it. So we scaled it up some more and decided to make it available to event planners, teachers, students, NFPs, market researchers or any other type of live audience organiser or participant.

We're both idea geeks and this was another project / idea that really interested us once we saw the greater business potential. And so SMS Poll was born.



How long it took before it was up and running?
We launched (Beta) in July 2008. It took us approximately 3 months to get our core offering to market.


What is the main objective/mission behind your venture?
For SMS Poll to be recognised as the number one tool for cost effective, innovative and fun audience polling, providing the ability for a variety of people to gauge their audience’s opinions and reactions within a matter of seconds.

What services it provides it for consumer or customers?
Poll creators can quickly and easily build a poll and present it live to their audience in four simple steps.

Poll creators can choose from a variety of features such as different styles of charts and effects, Auto Stop (handy if you need to stop your poll at a specific date/time), Web voting, Results Requests (have your results sent to your mobile), Embed to PPT, Embed to Blogs and SNS, Results analysis and export results to Excel.

Participants can easily engage with polls by either sending an SMS to a local number, web voting or mobile browser voting.

A variety of new features are currently in development and eventually we’ll see SMS Poll grow as a tailored offering with specific tools targeted to each of our core markets.

What type of customers you are targeting?
Educators & Students, Promoters and Event Planners, Public Speakers, Market Researchers, Not For Profits, Corporations and anyone else looking to work with an audience and wishing to gain their insight.

How many people are using your services?
We currently have over 350 active users. We’re still very young, but growing fast.

What sort of marketing are you are using to spread the word?
With our current offering we’re first and foremost adopting a viral approach making use of the usual suspects such as blogs, Facebook, StumbleUpon, Twitter etc. We use these channels to spread the ‘newness’ of the product.

We are and will continue to spend a great deal of time talking and meeting with the people who are our future consumers and who we also consider as the potential influencers.

SMS Poll is very much a product that will be seen and used in offline social network environments, so it’s here that we will probably be spending most of our time demo’ing and educating people about the product.

Coupled with our viral methods we also adopt SEM such as Google AdWords and SEO to help direct other consumers to our site.

Once our new product features are live then we will be looking at a dedicated marketing campaign across Australia and the UK and any other countries we may be operating in at that time.

How are you measuring the success of your venture? Are their any special mechanisms/tools in place to monitor the progress?
Success is measured on performance, national and international adoption and coverage, the progression in size of our active user base and customer feedback. And of course the bank balance.
J

We’re strong believers in a quality product and quality customer service to back it up. We grow with customer feedback. And we believe this is key to providing a successful product/service for your market.

What is the monetizing/revenue model? Is their any new model, which is being tried?
Currently SMS Poll offers a 6 tier pricing structure. We have a fairly generous free plan for individuals, students and small businesses looking to poll an audience of no more than 25 people.

We also offer custom plans and solutions (outside of our current product offering) and one-off pricing for large scale projects. These are tailored to the client’s needs and the environment in which the product will be used.

I expect eventually we will see structured pricing models split across the various markets we target as well as enterprise licensing.

Which are the main competitors or major players in this market segment?

  • IML
  • eInstruction
  • Turning Technologies
  • Fleetwood
  • iclicker
  • Poll Everywhere

What are the main technologies used behind this venture?
PHP, Flash, JavaScript, AJAX

What has been the most easy to use, out of box and helpful technology?
PEAR and SMARTY

Are you using lot of open source tool sets for this?
We are using a few open source components / libraries, but the majority of work is new development.

What is your operating environment (operating system) and what type of database you are using?
Linux and MySQL

What's your thought on being an entrepreneur? How tough it is to start a venture in Australia?
A tasty sandwich of fun‘n games wrapped around a healthy portion of little sleep and a slice of stress. Being an entrepreneur is definitely exciting times especially when you can see people actively using your product and providing you with positive feedback. But as glorious as it sounds, it also depends on your outlook and what you want from a job/life. If you’re after the 9-5, big bonuses, office perks (and, maybe even an office?!) you might want to take the other direction.

Being an entrepreneur comes with its pros and cons and potentially more of the latter, but if you’re willing to put in the graft and realise that overnight success doesn’t come to everyone then hopefully the pros will soon outweigh the cons.

Starting a venture in Australia (as opposed to your popular international hot beds like Silicon Valley) certainly adds a few preliminary ticks to the ‘cons’ column, but I think anyone will tell you that these days. However, the market is growing, it’s slowly getting stronger and a few more risks are being taken. Resources and networks are becoming more widely available by the active influencers and participators of the market, but right now I believe being an entrepreneur in Australia is all about putting the risk on your own shoulder and building on your own investment with a hope for VC support once your startup begins to show signs of success.

What's your thought on the start-ups culture and innovation coming out of Australia?
The level of innovation is on the increase with more and more new, fresh ideas being developed. We’re definitely in exciting times. However, these ideas need to be more widely publicised to the rest of the world – so other countries are aware of what we’re producing.

The culture is getting stronger and it’s the individuals participating in this market coupled with dedicated events and organisations such as the Top 100 Australian Web Apps, Anthill Cool Company Awards, Pitch Australia, Small Business Month, the ASSOB etc that are paving the way for this to happen.

How do you see the mobile battle between iphone, google (android) & rest of the players?

It’s an exciting discussion. It was only time before Google entered the arena. I don’t own an iPhone (gasp) but I’ve been holding out. I’m not an iPod fan either (double gasp!) – so this is already a wasted feature for me on the iPhone. Personally I’ve been playing the battle between the iPhone and the HTC Diamond Touch. The iPhone is definitely a shining star but I don’t think it’ll be too long before there’s a variety of ’just as good’ options out there. Of course, there’s the majority factor that the iPhone falls in the Apple suite of products, so to many – it will never be beaten. And this is one of the major factors that will play the battle between the iPhone and Android. At the end of the day for the majority folk it’s brand awareness.

Let’s face it. You can’t really consider there to be a battle at the moment when to most, the iPhone is hardware and the Android is software. It’s really down to the hardware manufacturers incorporating Android that will create the true battle between the two.

We all know that iPhones look cool. Interestingly it’s HTC who seem likely to launch the first Android phone – the Dream. So immediately the comparisons will begin not only on capabilities but also what is the most visually appealing. If a great looking Android phone was released and Apple kept the same aesthetic design but bumped up the capabilities to match those of the Android, I’d bet iPhone would still outsell.

However, there is a consideration from a development point of view and from what I’ve heard, the ease of programming on the Android SDK compared to the iPhone is much less complicated. What will result are increased offerings at lower cost and with a quicker time to market. How will this leave the iPhone user feeling? Maybe like they are missing out on the latest and greatest features, but then again only time will tell. Who knows what Apple has up their sleeve as a counter play?

I for one will be holding out to see the first Android phone and what it really brings to the debate.

How often do you catch up with others trying similar things and where do you catch up? Do you have dedicated communities in your city?
As often as possible and more so now with SMS Poll. If it’s not in person (sometimes there just isn’t enough time in the day!) then it’s regular introductions and communication via online. There’s always new startup ‘meet ups’ being organised in Sydney and we generally aim to get to as many of these as possible.

Do you have any advice for people who want to start their venture?

  • If you can build it for a dollar and sell it for two. Do it.
  • Start today.It’s fun and frantic. Whatever happens, you’ll experience a steeper learning curve in a shorter period of time that you might not get by doing your day to day job.
  • Get your plan together, keep focussed and deliver your core offering. The rest can come later. You have to learn to split features across phases. We all want the best product with every feature from day 1. But you have to be realistic. Get it to market and build in the background.
  • Don’t be afraid to discuss your idea. Talk to as many people as possible. Build your network. There’s a fear of sharing new ideas, but I always believe the more ideas and thoughts you share, the more you get back.

Thanks Ian for sharing your thoughts with us. All the best for future.

For coverage on other Australian startups, innovation, and tech trends, check this out and our coverage on interviews can be found here

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My Perfect - Dont Search, Choose

Vishal Wednesday, August 27, 2008 , , , , 0 comments

Today we showcase an exciting and a successful venture co-founded in 2007 by Andrew Ballard from Drysdale on the Bellarine Peninsula in Victoria, My Perfect - Dont Search, Choose or in other words it turns the idea of a search engine completely around.

In a recent email based interview with Andrew, he gave insights into his venture and how he is progressing with it. This is what he has to say:

• Please tell us about your venture/company?
We've developed a revolutionary new type of search engine - so different, in fact, that we've coined the phrase 'choice engine' to describe it.

To go back one step - there's a fundamental problem with the way traditional search engines work. So fundamental, in fact, that everyone seems oblivious to the problem. Traditional search engines begin with a single query and return thousands or millions of results. These results are determined by a complex algorithm that takes into account relevance, straight keyword matching, user history, and a whole lot of 'secret sauce'. Users browse the results, scanning the pages for further clues or triggers until they find a satisfying result - and then they follow that link to a new web site. If the web site doesn't answer their query, they go back and try more links until they find what they're looking for. It's something we're all well familiar with.

The problem is that the user on a traditional search engine is ultimately the one left to refine their own results, and most usually by trial and error of trying web sites that either are or aren't able to assist them in their query. Over time, people using search engines have grown used to typing more specific keywords, and adding geographic bounds to make the results more manageable. But even for power users, the refining the of the query - that is, finding the best information for the individual - is all left up to that user. Search engines are happy to provide results, but are simply not able to go the next level, and assist users in assessing whether the results truly *are* the best for the individual user - in short, search engines can only return information, not personalised assistance.

My Perfect turns the idea of a search engine completely around: instead of starting with one query, and resulting in thousand or millions of products, we *start* with many thousands of items in any given product category, and play a very fast and intelligent game of '20 questions', until the user is left with just one, perfect product. The questions posed are non-technical, and in a conversational style, so the user can quickly refine 1200 digital cameras, for instance, down to just a handful in only 5 questions. Our algorithm looks at what you've already answered and what items are still remaining, to determine which question to ask next, and therefore be able to split the pack as quickly as possible. The user can always choose to skip any question if not completely sure how to answer, so there are times when the pool of remaining items is more than one - but the big feature is that the whole choice engine is human-powered, so a user can help us frame a question that might be able to split the remaining items. Over time, the choice engine will grow to a stage where we will always be able to keep asking questions, until only your one perfect product remains.

We launched My Perfect this month with the categories of My Perfect Beer, Camera, Career and Phone. Over the next 3 months, we'll be rolling out 12 more categories, and we currently have plans for well over 50 categories in 2009. We've found that everybody already knows how to play 20 questions - it's the ultimate long-distance-car-trip game - so once people see how their answers quickly reduce the pool of beers remaining, the concept is just the same for the other categories.

Once we find a user's perfect product, we then show them reviews of that product, and direct them to online and bricks'n'mortar businesses where they can purchase that product, and do further research.

• Who are the people behind this and how it started?

  • Andrew Ballard: Founder & CEO
  • James Rickard: Co-founder & CTO
It first formed early in 2007, when I began questioning the reliance we all have on traditional search engines. Don't get me wrong - I love Google as much as the next person: for finding facts, opinions and imagery, it's an awesome resource. But all too often, the top results of my searches were well optimised sites full of more links that promised me the right information, but didn't add anything apart from more trial and error clicking. For finding information, search engines are brilliant. For helping people make sense of that information, well, tough luck - there aren't any/many sites that can actively help people make informed decisions - without either a heavy bias towards a commercial pool of results, or without the user having to read an "Idiot's guide to..." book prior to visiting industry portals.

Some early prototyping convinced me that playing the old game of 20 questions would be statistically simple, but very difficult algorithmically on the internet. I brought in James Rickard, and together we brainstormed how such a system might work and how it might look. The problem with being 'the first' of any kind is that there's no precedent, so simple choices like layout of the site, and the terminology we'd use, were all up for grabs. It was a similar problem I had when working as Creative Director on the Raine & Horne Real Estate site in 1999 - it was one of the first property listing sites on the web at that time, and the only precedent for 'saving' houses you looked at was by adding them to your shopping basket!

For My Perfect, we spent most of early 2007 making revisions to the site architecture until the day the Federal Election was called: we quickly put together a beta version called myperfectparty.com.au, where we let users answers questions based on each parties' policies and watch graphs of the political parties rise and fall according to their responses. Feedback was overwhelming - literally - our initial rapid development platform couldn't stand the load of the 60,000 questions asked in a two week period - and so by 2008, we'd redeveloped the site using a leading open-source, highly scalable framework.

We've been in stealth mode all this year, anxiously watching the search engine industry for any signs of 'choice' technology, while we finalised the multi-site and the human-powered aspects of the My Perfect choice engine. Almost every new development in search engine technology this year has been to incrementally evolve the traditional query-and-browse methodology - and although we were particularly worried about what form 'Cuill' might take when it was still in stealth mode, we're decidedly less worried about it now that it's been unveiled...

• How long it took before it was up and running?
In total, some 18 months: 6 months of rapid prototyping and an initial beta; 6 more months of rebuilding it in completely in a world-class framework for a multi-site approach; then 6 more months developing critical features and the back-end systems to manage the rollout of the range of sites to follow.

• What is the main objective/mission behind your venture?
Our aim is twofold: firstly, we want help consumers with their online product research and their online purchasing decisions. The choice engine is an 'expert in your pocket' for a consumer - a true expert system. Even more importantly, the choice engine is as unbiased as we can possibly make it - it relies on the cold, hard 'tech specs' of any given category to choose or discard products, and not opinions nor unfair judgments of merit. If there are any inconsistencies in the tech specs of a product, the users of the site can 'crowdsurf' the correct answer - so we can effectively use the collective brain of the user base to ensure the right outcomes over time.

Our second objective is to provide businesses with a vastly superior standard of sales leads for their marketing dollar. With advertising clickthrough rates getting into fractions of a percent, and search engine marketing cost per clicks rising, but without corresponding rises in conversion rates, My Perfect aims to give businesses as high a qualified sales lead as possible. We're effectively doing the pre-sales work to determine which product a consumer should buy or consider buying, and then only linking to businesses who can directly fulfill that particular product.

We're trying as hard to match a consumer with their perfect product, as we are trying hard to help businesses find their perfect customers.

• What type of customers you are targeting?
Any consumer somewhere in the 'purchasing cycle' of a product in the categories we offer. The 'purchasing cycle' is well known to all of us: we initially have little interest in a certain product category - a new car, for instance - but then over time, we being to consider an upgrade. We slowly get around to some initial research, and at some stage, we do some serious investigation into prices/models and reading reviews. Just before we commit to a purchase, we're actively following all leads, trying to find the best deal in town - and then, at the moment of purchase, our interest peaks... and then just as abruptly, after a purchase, our interest dives back to near zero.

With this knowledge of the cycle of consumer research, we're aiming My Perfect at consumers everywhere on that path: from early snoopers, to avid researchers, to hot prospects - and even to consumers after their purchase - there are already a lot of people using the site to verify if they made the right decision after the fact!

We're most effective for consumers with 'beginner' to 'intermediate' knowledge of the category they're looking for. The non-technical language throughout ensures that consumers don't need to know what the right terminology is - they just need to respond to the questions and pick the most appropriate answer.

Experts are more than welcome on the site - but we have a higher purpose for them: we want to turn them into 'gurus'. By writing reviews and adding new items, users on the site can climb a social ranking system, where by they begin as 'novices', and end up as 'experts', 'gurus' or 'legends'. As users contribute more to the site, the weighting of their reviews goes up, so there is always a moderating factor to let experienced users guide newer ones.

One fundamental truth about us as humans is that we're all experts in some things, but not in other things. So while one person may be an expert in wines, and can contribute back a few precious gems of knowledge into the system, they may not be an expert in TVs, and would be grateful for the collective wisdom of the experts in the TV category.

• How many people are using your services?
We only launched our v1.0 in mid-August, and we purposefully soft-launched it to family/friends/forums to give it a real-life load test. As such, we're -ahem- not peaking our server load quite yet.

In beta trials during the Federal Election in 2007, we had almost 10,000 visitors in the two weeks leading up to polling day, so if that's any indication of the attraction of the concept and given that we'll have 10 such sites running by Christmas, we'll soon have the beginnings of a great base of users, gurus and businesses.

• What sort of marketing you are using to spread the word?
Word of mouth at this stage, but since we're so industry segmented, we'll hit the trade show scene next year to ensure good market penetration into both the consumers and businesses of one category at a time.

We're currently doing a mini-pitching tour: three on the horizon in the next 7 days, so we're looking forward to a future where our marketing budget might not be limited by the size of our collective credit cards.

• How are you measuring the success of your venture? Are their any special mechanisms/tools in place to monitor the progress?
Right now, we're capturing a lot of vital product metadata as our users visit the site. Of course, we use the standard setup as far as page views/analytics is concerned, but a whole raft of user-identity-free information is being captured about which products are on top of results, and which products are moving in different segments of an industry. Over time, we'll be able to package a sophisticated product analytics offering - not unlike the Hitwise model, but for actual product trends, not just for product *web site* trends. From a psychological point of view, we've noticed that the choice engine is quite revealing in the final perfect product you arrive at - the first time - but then on subsequent tries, many users try to 'outthink' the choice engine, to try to find a product they already have in mind. For instance, it's quite probable than many users on myperfectcar will use the choice engine without over-analysing the questions, and quite honestly end up with a Toyota Camry as their perfect car - functional, practical, and great value for money, just not earth-shatteringly exciting. We've then noticed that out test users desperately try to find the Porsches to 'prove' to their spouse that it really *is* their perfect car.

Technically, all the categories of the site are their own sub-site: linked, but independent at this point. So financially, we'll be measuring the success of different industries against different yardsticks, given the breadth and depth of their respective markets. As an extreme example of this, we'll be aiming for at least 1 category in 10 to be community focused: myperfectpet will provide guidance of what type of animal might best suit you, and give free links to non-profit clubs and animal welfare shelters where you can find that type of pet. Myperfectsport will be aimed at helping people determine what would best suit their health/lifestyle needs, and will link off to the nearest club or association of their perfect sport for more information.

• What is the monetizing/revenue model? Is their any new model, which is being tried?
Revenue will be generated from three sources: listing fees, product analytics, and a small measure of display advertising. Listing fees will be the primary driver of revenue, and we firmly believe we'll be providing excellent value in this area, due to our choice engine providing educated, perfectly qualified leads direct to businesses.

We will announce a range of innovative product analytic offerings in 2009, that will give real-time insights into the trends and forecasts of different manufacturers, products and industries. This is groundbreaking stuff - My Perfect is a tool exclusively for consumers wanting to decide what products to buy in any one of our categories we offer - and by virtue of the fact that we go on to actively assist that consumer in narrowing their search, we can easily remove all personal user information, and aggregate the remaining data to uncover the thought processes of consumers in Australia.

• Which are the main competitors or major players in this market segment?
In a direct sense: none. Indirectly, though, we're playing against traditional search engines as either a competitor or as a companion site. We're also a counterpoint the major industry-specific portals in that they provide in depth coverage on any one given industry, but generally assume that their user base also has a corresponding in depth knowledge. For instance, when a consumer wants a new plasma TV, they don't always need to know all the ins and outs of the jargon nor do they want to have to read a new review per week until they find what they want - a large proportion of consumers just want to make a good decision, quickly, from all available choices. In a similar fashion to industry portals, comparison sites provide a great way to place a few items side by side to compare technical specifications - but the emphasis is on the consumer to choose the right products to compare side by side. Most often, consumers on comparison sites will compare only the brands they know best, when there may well be hidden gems of products that would suit them better. In contrast, the My Perfect choice engine includes all products in a given category, and only rules them out based on a consumers' needs, not on their brand awareness or lack thereof.

• What are the main technologies used behind this venture?
It's pretty much LAMP, all the way. We love LAMP. The framework that holds our Apache, Mysql and PHP together is CakePHP (cakephp.org) - a MVC (model/view/controller) framework for PHP - essentially PHP's version of Ruby on Rails. It's fast, flexible, and the only drawback is the absolute conciseness of code: rather than get into trouble with managing 100,000 lines of code to power My Perfect, we have only about 2-3,000 lines of code. It's a very compact framework, so we often fall over each other working on the same files at the same time. The documentation of CakePHP is finally 'coming good' - it was a little sketchy there 12 months ago when we chose it as our primary framework, but the CakePHP community and the level of documentation have improved dramatically in recent months, so we feel we made the correct choice.

Back end, we use my favourite rich-development application: Filemaker. It's one of the fastest ways to create business level logic, and keep it separated from the live server environment, where speed and brevity are paramount. That means that James and I have direct access to the live systems for analysis and admin functions, without adding an overhead to the live site or slowing it down at all.

• How often do you catch up with others trying similar things and where do you catch up? Do you have dedicated communities in your city?
We're based in 'scenic Drysdale', on the Bellarine Peninsula in Victoria - a gorgeous semi-rural town, so we're slightly removed from most of the after-hours networking in Melbourne. We've also been in stealth mode for so long, we thought we'd find it hard actually announcing our site to the startup world. Fortunately, talking about your passion isn't hard, and so we've been able to de-lurk from an array of forums and online communities and introduce ourselves properly, most notably the Silicon Beach group of Aussie startups, which we've already found an invaluable resource. Local startup networks? Not likely... Since we're on the Bellarine Peninsula, we might just have to start our own 'silicon belly' right here...

• Do you have any advice for people who want to start their venture?
Read deeply and read widely - there are incredible resources out there for anyone dreaming about beginning something new. If you pick your gurus, and find out who *their* gurus are, you'll eventually be able to tap a collective brain that can help develop the practical aspects of your venture, as well as shape the ethos behind how you go about your venture. I haven't subscribed to a newspaper nor a magazine for about 10 years, but each morning, I read/scan/absorb over 200 blogs by following their newsfeeds via RSS - I wake up with a coffee and a blog for breakfast.

My final piece of advice would be not to specialise: understand that to be an entrepreneur, you need to wear many, many hats. The good news is that all the different 'hats' you'll need to start your own venture are all interlinked - they all require a mixture of creativity, technical ability, human interaction, and a good dose of passion. Some tasks may only touch one or two of these traits, but often you need to use many on the same day. So don't be afraid to learn new skills - and realise that each new skill is only marginally different from the others in the mixture of those traits. So learn all about design, technology, marketing, usability, finance, psychology - so that when you're start your venture in earnest, you'll have a broad and deep knowledge of, well, everything you'll need!

Thanks Andrew for sharing your thoughts with us. All the best for future.

For coverage on other Australian startups, innovation, analysis, tech trends, check this out and our coverage on interviews can be found here

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Report on Aussie Mobile Phone Lifestyle Index - Games, True Tones, SMS, Maps, Music, MSN Messenger Most Popular

Vishal Monday, August 25, 2008 , , , 0 comments

The Mobile Industry Group of the Australian Interactive Media Industry Association
(AIMIA), in collaboration with m.Net Corporation and Ideal Interfaces, has published the results of the fourth edition of Australian Mobile Phone Lifestyle Index. The report provides invaluable insight into the background, usage behaviour and preferences of Australian mobile phone users. Some of the key finding of this report are:

Mobile phone ownership:

  • 49% owned a mobile phone for over seven years.
  • 34% of participants noted that they owned a second mobile phone and/or SIM, with over half of these aged 22–40 years old, 62% of whom were female. Half of the respondents who owned a second mobile phone were married or living together.
Telecommunications provider:
  • Optus (35%) and Telstra (25%) were in the same positions as the last survey and were still the dominant telecommunications providers with the participants of this survey. Vodafone (16%) just took the third spot back from 3 (15%).
  • 26% of survey respondents noted that they would prefer to be with a different telecommunications provider.
Bill payment:
  • Nearly 85% paid their own mobile phone bill.
  • There was a significant increase in the number of respondents who were on prepaid (41%) while the remaining 58% had a monthly bill. Once again, the younger demographic tends to have prepaid, with the majority of over 25 year olds on a monthly plan.
  • 65% were on capped plans, another significant increase from the previous survey.
Monthly spend :
  • 70% spent <$60, 19% spent $21–$31, and 14% of respondents spent more than $100 per month on their mobile phone bill.
  • Brand: 47% of participants currently own a Nokia mobile phone (same as last year), followed by Motorola and Sony Ericsson (equal with 12%), with Samsung getting closer in third place with 11%.
  • 25% of respondents stated that their phone was 3G, down from 30% last year. However, more people didn’t know if they had a 3G phone or not (20%) than in Survey 3 (11%).
Consumption of Services













Use of mobile phone by monthly phone bill spend:

  • Most participants identified voice (84%) and SMS (84%) as key expenditure items on their monthly phone bill, followed by MMS (22%), buying content (9%), and email (7%).
  • 9% of respondents that did not buy content via their phone bill purchased content through an alternative channel, e.g., credit card statement. Overall the results are consistent with Survey 3 results.
  • There was a slight decline in buying content compared to previous surveys, while there appears to be some services like MMS and email where customers are seeing value in spending additional dollars.
  • Voice and SMS dominate as the key methods of communication across all groups.
  • SMS and MMS are most popular as a means of communicating with family and friends.
Current Content Purchasing And Information Accessing Behaviour In The Last 12 Months
  • Similar to last year, more than 50% of participants became aware of new mobile content via the Internet, then close friends, on the phone menu, and awareness via TV.
  • 48% of participants purchased content via the Internet from a PC, 17% via the carrier’s portal, and 12% from the mobile phone menu.
  • Of those that became aware of the content via the mobile phone, followed by Optus (25%) and Telstra (25%) in equal second. However, Telstra’s customers were more likely to become aware of new content via marketing from the telephone company (31%), followed by Optus (29%).
  • The top three content types purchased were games (43%), true tones (42%) and wallpapers (33%).
  • Digital music downloads continue to rapidly grow. In the last 2 years, the proportion of respondents who have purchased digital content downloads has increased by 113%. Other growth areas in the last 2 years were true tones (173% growth) and games (171% growth).
  • Respondents on the 3 and Virgin networks were most likely to purchase mobile content, while Telstra customers were more likely not to. This is not a surprise at all, this is exactly what I predicted
  • The greatest growth since Survey 3 has occurred in maps (347%), restaurant/cafĂ© guides and reviews (174%), and TV listings (93%).
  • Respondents on the 3 and Vodafone networks were most likely to use information services, while those on Optus, Virgin or ‘Other’ were less likely.
Expected Future Usage
  • The most popular requests for future mobile content were digital music downloads (30%), games (27%) and wallpapers (25%).
  • The most popular requests for future mobile information were maps (31%), news (29%) and weather content (28%).
  • Again, SMS (62%) was the most desired application for future use, email (49%) came second, and then MMS (42%).
  • 83% of respondents stated that they used at least one of the listed online communities on their PC.
  • MSN Messenger was the most popular computer community (46%), followed by YouTube (45%) and Facebook (28%).
Communities on the Mobile Phone
  • In almost an exact reverse of the above, only 16% of respondents stated that they used at least one of the listed online communities on their mobile phone.
  • MSN Messenger was again the most popular mobile community (8%), followed by Facebook (5%) and MySpace (3%).
Creating and Sharing Content for the Mobile Phone
  • 33% of respondents said that they had created content on their mobile phones to share with others. 96% shared photos, 41% shared videos and 32% shared music.
  • MMS (63%) and Bluetooth (61%) were the main methods of sharing content. This is important for marketers as it suggests that consumers have a good understanding of how to transfer data via Bluetooth.
One thing is clear that Mobile is becoming more popular means of communication, consumption of services & entertainment. Since these findings doesn't have any data from the new released iPhone 2.0. It will be interesting to see how iPhone2.0 changes the landscape in future, because it will fuel the growth of this domain enormously.
For more detailed insights, download this report.

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Story of Australian Founders At Work

Vishal Saturday, August 23, 2008 , , , , 4 comments

Today I would like to give you some more insights into how this journey of following Aussie technology startups started and where I'm heading with this initiative.

I have been following technology startups coming out of Australia since 2005. I published the first comprehensive list of startups of Australia in 2006 for RWW. Martin Wells & users at whirlpoolforums provided leads in compiling that list. From their onwards I have kept a close eye on the new ventures coming out of Australia.

In March 2008, I conducted the First Online Startups Carnival which was Judged by Duncan Riley, Ross Dawson & Justin Davies.BookPageDuring the carnival we (me + Judges) covered nearly 30 startups. Since then I have covered additional 40 startups - so in total 70 startups and interviews with VC’s & Angel Investors. This list will be growing, as I will be covering more in coming days/weeks/months/years.

In addition to this I have started publishing market analysis, technology & business trends especially with focus to local market. In future I intend to write more in this area as well.

Now what next:
Well, I have now started compiling these published interviews in a Book under the Title - Australian Founders At Work. This idea of Book was suggested by none other then Duncan Riley when I caught up with him and Ben Barren. My sincere thanks to Duncan for suggesting this excellent idea.
I must admit this will be my first attempt on writing a book in a non-technical area. I have published quite a few articles online and 1-2 famous technical tutorials, but nothing like this. Writing this is little bit easy :-) as most of the content (99%) is created by others (people whom I have interviewed). My sincere thanks to all who contributed in this, sometimes a painful process. I intend to find a publisher for this, but if I'm not successful, I will just use the power of web - i.e; Lulu.com.

I would like to get some feedback from all of you on this initiative and your thoughts on this.

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Fairfax Media FY08 Report Highlights - Online Growth is Strong, Print is Diminishing

Vishal Friday, August 22, 2008 , 0 comments

David Kirk CEO of Fairfax Media presented FY08 report to the shareholders on Aug 21, 2008. Some of the highlights of this report are :

  • Revenue up 2.9 %
  • Diversified Portfolio - Online, Radio Network, Southern Star, NZ Publishing, Australia and Regional Community Publication
  • Canberra Times advertising revenue growing strongly
  • Sydney’s Community publication were affected by lower real estate activity
  • In all Regional & Community publications revenue is up by 5.5%
  • Melbourne & Sydney markets are showing reduction in advertising (newspaper & magazines).
  • Good growth in magazine revenues
Fairfax Revenue 2008

  • Revenue is down 1.0% in Printing across Australia (17 sites)
  • Printing in Wagg, Nowra and Warrnambool is closed; Burnie closure is announced this month.
  • Strong revenue & profit growth in specialist publications.
  • Business Review Weekly is profitable again
  • AFR.com seems to be doing well even though it’s a walled garden.
  • Online revenues up by 33%
  • Leading player in auctions, motors, real estate classifieds & growing in Employment sections.
  • Fairfax Digital revenue is up 30%
  • Investments in, Thevine.com. au, Watoday.com. au, Brisbanetimes.com. au
  • Fairfax Digital to sell online display advertising for eBay.com.au
  • Radio network revenue is up by 2.1%
  • Sydney advertising on radio is weaker, Rest of the cities (Melbourne, Perth, Brisbane) are doing well
Its not a surprise that Online is growing rapidly and Print is diminishing. Considering the market forces now its not a bad result. It will be interesting to see how it goes in future esp in online consumption of the content, as the platform/medium of consumption is changing rapidly. Expanding into NZ has some success and US agricultural segment is doing well.

For coverage on other Australian startups, innovation, analysis, tech trends, check this out and our coverage on interviews can be found here

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Momentum Technologies Group - Live Video Streaming Over Mobile

Vishal Thursday, August 21, 2008 , , , , 1 comments

Today we showcase an exciting and a successful venture co-founded by Adele Whish-Wilson in 2002, Momentum Technologies Group - Live Video Streaming Over Mobile.

In a recent email based interview with Adele, she gave insights into her venture and how she is progressing with it. This is what she has to say:

• Please tell us about yourself, your background and interests?
My background was initially in psychology and communications, which lead to roles in the private, community and government sectors that covered everything from supporting health campaigns to assisting develop state government department e-business strategies. My interested in finding ways to improve ‘how things are done’ lead me to take a role as a business analyst, then onto starting Momentum in 2002 – where I continue to be focused on assisting our clients find a better way to get things done.
My interested are long distance running (completed my first marathon last year, and did Oxfam’s 100km Trailwalker this year), yoga and pilates. I’m positively evangelical about the benefits of balancing life in front of a keyboard with keeping active, and these hobbies, (along with my other interests of food and wine), are the tools that keep me sane!

• Please tell us about your venture/company?
Melbourne-based and Australian-owned, Momentum is a pioneer in live video streaming over mobile data networks. Built on a great idea and five years of development, adaptation and pure sweat – we’re poised for dramatic growth in the coming 12 months. At an exciting time, our team of 15 technology, and support, professionals collaborate to own, innovate and make things happen in the field of interactive visual communications. Eying mobile applications in the consumer market, and with a firm foothold in several enterprise markets – including health, education, emergency services and industrial – we are market leaders in what we offer, and we’re very proud of that.

• Who are the people behind this and how it started?
The best companies are formed out of need. This venture started out as a twinkle in our eyes – that is myself, Guy Franklin and Andrew Rowsell in 2001 (before being officially launched in 2002 – terrible timing in the ‘IT Start-Up’ market!). Bringing together our respective skills in business management, multimedia and video programming, the trio wanted to make the world a better place through technology, particularly live-video streaming. I was working in government agencies writing functional requirements for systems that never got built – I was so keen to actually see a real product develop and in the hands of users. As a team we really believed that we could change the way Australians (and the rest of the world) worked, with the help of real visual communication. Our thinking as evolved and we’re still passionate about making a positive change to the state of play in the technology sector.

• What is the main objective/mission behind your venture?
We aim to be the best at connecting people through better mobile video technology. From beaming interactive virtual art exhibitions hosted by the curator in Sunshine Coast to Year Six students in Bundaberg, to being part of the security equipment used by police at APEC , we enable people to cut through distances to communicate meaningfully, broaden horizons and harvest opportunities. This flows into our company ethos where talent is recognised, achievement rewarded and work-life balance cherished (although I’m really not sure we’ve got that one sorted yet – but we’ll keep trying). We’re a small team of flexible and committed individuals who have come together from diverse professional backgrounds, cultures and countries with a common aim – better living through technology. And I do really love my team – they are a fantastically talented bunch of people who are (mostly!) a joy to work with.

• What services it provides it for consumer or customers?
Momentum created m-View – a fully mobile wireless broadcasting solution with the best video performance to the widest reach of users. People can connect and interact using live video from mobile to mobile, or mobile to PC’s, around the globe. We have won several awards for the usability, usefulness and uniqueness of m-View. Our new social video networking product powered by m-View, LocalJoeLive.com, will be ready for the market later this year. It has gained strong interest from several global telcos as a platform upon which to build mobile applications and a key driver of future revenue growth.

• What type of customers you are targeting?
We target enterprise clients across the government, health, industrial and mining, utility and resources sectors. Anywhere that there are mobile workers and a finite number of specialists that support them – be they technicians, doctors, engineers or fire-fighters. We are planning to launch a self service business level product aimed at small to medium sized enterprises. And our consumer social networking service, Local Joe Live, should be ready for beta by the end of this year (which we’re very excited about).

• How many people are using your services?
We have about 100 installations of our enterprise solution. For our self service business-level product, we anticipate a high-volume of sales. And with Local Joe Live, we’re aiming for millions of users.

• What sort of marketing you are using to spread the word?
For our enterprise solutions, we rely primarily on referrals and direct marketing to spread the word. We also try to generate as much awareness through PR efforts as possible. For the new products, we thinking about viral campaigns and the social media as channels to get the word out.

• What is the monetizing/revenue model? Is there any new model that is being tried?
We combine annual software licenses, monthly support & maintenance, one-off costs for some camera systems and consultancy fees. We are introducing a new, simplified, monthly pricing model for our new hosted service which is coming soon, which we believe will benefit many of our smaller clients.

• What are the main technologies used behind this venture?
As far as platforms go, we use Microsoft .NET quite heavily throughout our PC based systems. Our mobile products use standard C++ as much as possible, although we sometimes blend this with Symbian's particular C++ dialect for Series 60 phones.

We use a variety of compression systems like MPEG4 and H.264, as well as some open-source alternatives like Theora. We also use (as far as possible) IETF standard streaming protocols like RTSP & RTP for delivering our streaming media to viewers.

• Are you using lot of open source tool sets for this?
Our main use of open-source has been with media compression libraries like Theora, Speex, Ogg and ffmpeg, which was vital to our products early development, as the big name codecs were out of our financial reach in the early days, and didn’t do what we needed them to do anyway.

• What is your operating environment (operating system) and what type of database you are using?
Our broadcaster & viewer applications run on Windows (XP and Vista), Windows Mobile and Series 60 3rd Edition (Symbian). Our server runs on Windows Server 2003 and uses MS SQL Server for data storage. Our road map shows us porting to a number of additional mobile platforms this year.

• What's your thought on being an entrepreneur? How tough it is to start a venture in Australia?
Well, starting in late 2001 was certainly tough – there was very little funding available for start up ventures, and a lot of cynicism of ‘IT start-ups’ overall (thanks a lot Sausage Software). The benefit of this was that it forced us to respond quickly to our client’s demands, to drive revenue to survive, which in turn made m-View a better product. Maybe if we’d had millions of dollars of funding we wouldn’t have had to try so hard with our clients, and m-View may not have been the great system it now is...who knows!

• What's your thought on the start-ups culture and innovation coming out of Australia?

I think we have plenty of room to improve. I’m currently watching the Olympics and I can’t help but think to myself ‘if only there was 5% of the focus and funding on innovation in Australia as there is in sport...’ Start-ups are the big employers and exporters of tomorrow, so it makes sense to support them, and we need to do better to create a culture where ‘having a go’ is encouraged and supported – whether it results in success or failure.

• How do you see the mobile battle between iphone, google (android) & rest of the players?
There’s a lot of hype at the moment, which we’re trying not to get caught up in. As soon as the iphone came out in Australia, we were asked at every meeting ‘does m-View work on the iphone’? We did consider altering our development roadmap to respond to this, but we took a deep breath and considered “is this what our market really wants right now?”.
Things we look at is what is the market share of the device, what segments of the market is using that device, and what sort of developer support does that device offer and how good is that device? There’s no doubt that mobiles will be the new home PCs as more applications are available on mobiles, and we’re excited to be part of this revolution.

• What do you think the government (federal and state) should do to improve the culture of innovation and the telecom industry?

Securing funding for research and development work can be a challenge. We were lucky to secure grants from the Commonwealth Government, as well as Telstra, to fund a lot of our initial development work. With better R&D grants systems in place, a lot more young companies, like us, will have the means to pursue the great ideas that they have. Things appear to have gone backwards on this front recently, and I’m really looking forward to seeing this addressed and the Rudd government doing all it can to support innovation – because innovation drives business growth, new jobs and exports – supporting it makes a lot of sense.

• How often do you catch up with others trying similar things and where do you catch up? Do you have dedicated communities in your city?
Trade shows, competitions and conferences are the best places to meet and spend time with like-minded people working in the same exciting space. Recently, we were at the NAVTEQ Global LBS Challenge, and it was fantastic for those reasons. We met and got to put our solution in front some of the major players in the industry. At the same time, we were getting to know fellow exhibitors and competitors from all around the world.

• Do you have any advice for people who want to start their venture?
Be passionate about what you’re doing and be ready for the long haul. It can be a long road, with a lot of hard work, stress and rejection – you have to be strong enough to persevere and believe in what you’re doing. Sometimes a great idea doesn’t always take off, and Google may not be on the trail to buy you out. This business takes a lot of commitment, reinvention and adaptation, and you must be passionate and tenacious to take yourself through the long process.
Also, if you’re going to start your own business, I’d advise you to work in a small start-up yourself first – best to know what you’re in for and learn from other people’s mistake first!

Thanks Adele for sharing your thoughts with us. All the best for future.

For coverage on other Australian startups, innovation,
analysis, tech trends, check this out and our coverage on interviews can be found here

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ThreatMETRIX - Security for eCommerce Applications

Vishal Wednesday, August 20, 2008 , , , , , , 0 comments

Today we showcase an exciting and a successful venture co-founded by David Jones in 2005, ThreatMETRIX - Security for eCommerce Applications.

In a recent email based interview with David, he gave insights into his venture and how he is progressing with it. This is what he has to say:

• Please tell us about your venture/company?
We created ThreatMETRIX to deliver a new layer of security protection specifically for the explosive growth of eCommerce transactions. With growth of over 20% pa of on-line credit card transactions and web 2.0 application now monetizing, the fraudsters have taken advantage of their anonymity on the internet to steal credit cards, fraudulently purchase products and launder money. ThreatMETRIX delivers intelligence to eCommerce sites to detect both good customers and fraudsters using stolen identities.

• Who are the people behind this and how it started?
The founders and core team previously built security products for Surfcontrol (now WebSENSE) - we saw the use of botnets and compromised hosts were how on-line criminals were hiding their identities when committing fraud. The company started out as SpamMATTERS, a product we delivered to the Australian Federal Government (Australian Communications and Media Authority) to track phishing and spamming operations.

• How long it took before it was up and running?
We spent 2 years in research and development to build out the technology and intellectual property to solve on-line eCommerce transaction fraud. During that time we spoke with some of the largest eCommerce players on the internet and listened to their challenges and unsolved problems. Its true that there is no silver bullet for fraud but we think that by bringing our security expertise to a marketplace with a large unsolved problem - our products are the next generation in online commerce protection.

• What services it provides it for consumer or customers?
The ThreatMETRIX mission is to help eCommerce sites deliver increased revenues by sorting the good customers from the fraudsters whilst reducing the infrastructure costs to achieve this. In total our customers are impacting about 20% of US credit-card transactions.

• What type of customers you are targeting?
We have two products:
1. For small and SME merchants and eCommerce players, we provide a SaaS based fraud solution, by adding our technology with just a few lines of code, they can be up and running – reducing fraud and increasing revenues. All that is required is browser-based login
2. For larger merchants and payment gateways we deliver a Web Services API that can easily be added to existing payment and fraud systems. Again – integration is simple and fast.

• What sort of marketing you are using to spread the word?
Marketing to-date has been primarily direct prospecting, trade-show attendance/speaking and SEO/SEM, the companies has been growing the US-based executive team and no doubt that will change as we explore how to fast-track merchants through our SaaS signup service.

• How are you measuring the success of your venture? Are their any special mechanisms/tools in place to monitor the progress?
The best way to measure success is the value to our customers: if we deliver a % uplift in revenue or slice their fraud rates in half, these metrics are the main things that matter – from there revenues flow. Because of this our monetization model is primarily transaction-based but there are a number of models that can apply – I’d love to talk about them but then I would have to shoot you :)

• What are the main technologies used behind this venture?
The main technologies behind the ThreatMETRIX solutions is what is called Device Intelligence, this deliver the edge that merchants need to have more visibility in the transaction we combine this with a multi-tenant SaaS platform that uses a highly scaled rules engine. All this is implemented on open source platforms using C++ for core systems and perl for user interface. We’ve avoided trendy things like ruby and flex because ultimately we are solving business solutions rather than creating a web2.0 app.

• What’s your thought on being an entrepreneur? How tough it is to start a venture in Australia?
I think your questions on entrepreneurship in Australia are the most interesting.....
Yes, its tough to start a global company in Australia, there are challenges in VC funding availability, large enough market of customers to prove-out your technology and a deep enough pool of skills and experience. In our case, most customers who have scaled enough to have significant fraud problems are in the US, Asia or Europe, this means that we spend a lot of time in the US and in fact we shifted our HQ to Palo Alto in March.

• How often do you catch up with others trying similar things and where do you catch up? Do you have dedicated communities in your city?
Networking with others in the SF Bay area is where real value comes, whilst there is courageous and driven people in Sydney, the breadth of expertise and experience in the bay area dwarfs the opportunities available locally.

• What do you think the government (federal and state) should do to improve the culture of innovation and the IT industry?
I truly regret the Rudd governments decision to put on hold the Commercial Ready program, this is a powerful counter to the venture challenges that Australian Innovation has and I fear that the government thinks that putting computers in schoolrooms all that is required to be a “clever-country”. ThreatMETRIX, leverage some grant funding during our R&D phase and this enabled us to later attract VC funding approximately 10x the grant – this is valuable because the grant process is competitive I don’t believe it is a wasted government spend. On the contrary but pausing the grant program, I imagine several Australian innovations that would have created jobs have now “died on the vine”. Our country’s leadership needs to recognize that neither sheep nor mining will be a sustainable basis for a robust future economy and innovation needs to be supported otherwise our smart graduates will drain to the US, Asia or just get a job at the banks – and we know what innovators banks are – not!

• Do you have any advice for people who want to start their venture?
I would recommend any OZ entrepreneur to place themselves (a) where their target market is, (b) where the specialists to build the business are. For example if I was building a groupware or telecoms company then Boston makes sense, for Bio maybe San Diego but for internet and clean-tech the south bay area is an absolute must regardless of the cost. Likewise, access to mentors is best sought in the field that you specialize in.

Background:
Mr. Jones co-founded ThreatMETRIX in 2005 and has been the CEO since inception. He has more than 15 years experience in technical and management roles within the software industry. Prior to co-founding ThreatMETRIX Mr. Jones founded SpamMATTERS delivering products used by Federal Government enforcement agencies for tracking Phishing and Spamming operations.
At Surfcontrol, he was VP of Global Research, a leading internet content filtering company that has most recently been acquired by WebSENSE. Among his major achievements at SurfControl was the management of the Email Filtering and flagship anti-spam solutions generating over 30% of company revenues.
Mr. Jones arrived at his position at SurfControl when EmU Tech, another company he founded, was acquired by SurfControl in 2001. Mr. Jones holds a B.E. in Electrical Engineering from the University of Technology, Sydney.
ThreatMETRIX.com with offices in Palo Alto California and Sydney Australia.

Thanks David for sharing your thoughts with us. All the best for future.

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