Today we showcase an exciting and successful venture founded by, Mark White from, Brisbane, Australia, Locatrix. It provides mobile social networking solutions for deployment by network operators and location-based services to corporate customers and application solution providers. It uses location to create and shape mobile content experiences that engage subscribers and generate ARPU. This is the engine beneath Telstra’s (Sensis) Whereis Everyone. We recently learnt about Locatrix while compiling the list of Emerging Mobile Startups in Australia.In a recent email-based interview with Mark, 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?
I’m a native Queenslander, completing a degree in Computer Science at the University of Queensland before embarking on a career that gravitated towards technical marketing roles here and in Singapore for US multinational companies: Tandem Computers, Compaq, and finally Red Hat, for whom I was Vice-President and General Manager Asia-Pacific (and the first employee west of California). Having got a taste of growing Red Hat’s Asia-Pacific operation from zero to direct and indirect sales in 17 countries, and an international engineering centre here in Brisbane, I wanted to start my own company. This was an indirect path – I first helped create Mantara, Inc. as a spinoff from the CRC for Enterprise Distributed Systems Technology (DSTC), and also got to know our seed investors (IQFunds) by working with some of their companies.
• Please tell us about your venture/company?
We’re developers of mobile location application solutions. We use location to create and shape mobile content experiences that engage subscribers and generate revenue for our mobile network operator customers, which in Australia includes Telstra and we’re just about to launch our first international customer services.
• Who are the people behind this and how it started?
I founded the company in November 2003; Rick Anstey and Laurie Hammond from IQ Funds provided seed capital and were joined by TeQstart, an investment vehicle of the Queensland State Government. We’ve not raised any capital since, and have been operating on cashflow.
• How long it took before it was up and running?
Too long! We went down many rabbit holes in developing the first (and second) generation of our application solutions. The third time’s the charm, as they say!
• What is the main objective/mission behind your venture?
We provide mobile network operators with a safe, revenue-positive set of consumer application services they can offer to mobile subscribers. Doing this efficiently, safely – very important from a privacy perspective – and in a cost-effective way has been a bugbear for mobile operators. Many operators around the world have launched or piloted consumer location services – always very expensive and with minimal uptake. That’s now changing, and we’re leading the way.
• What type of customers you are targeting?
Mobile network operators; here, in Europe, and in South Asia as primary target markets.
• What sort of marketing you are using to spread the word?
We’re working with our operator customers, as they are using their own brands; Telstra for example provides our product to consumers under the Whereis Everyone brand. We’re working to improve the viral marketing capabilities of our products; this is a key opportunity going forward.
• What is the monetizing/revenue model? Is there any new model, which is being tried?
We’re working hard to be a fast time-to-revenue solution for our operator customers; we’re hosting the application services, and providing revenue-share and monthly licensing models that allow them to positively monetize their subscriber base.
• Which are the main competitors or major players in this market segment?
There are a couple of really well-funded competitors in the US, such as Loopt. They’re burning cash, we’re generating it – so draw your own conclusions. There is also a gaggle of companies in the consumer location-based services (LBS) space, primarily around navigation and social networking, with whom we don’t directly compete but occasionally get compared.
In general, all location-based services are good – they educate the market and promote the space. There’s no one killer application – despite everyone’s attempt to create one! We enable a variety of application experiences and instead focus on enabling mobile network operators to add their unique value (mobile location) to the user experience.
• What is your operating environment (operating system) and what type of database you are using?
Ubuntu Linux and PostgreSQL are our mainstays.
• Are you using a lot of open-source tool sets for this?
Absolutely!
• What's your thought on being an entrepreneur? How tough it is to start a venture in Australia?
It's tough but not impossible. I was pretty focused – after years of selling US-developed technologies in the region – on Australia being the innovation base. Not everyone is suited to an entrepreneurial gig – I began Locatrix with a partner, but it didn’t work out: hard work, focus and financial risk on something unproven aren’t everyone’s idea of a good time. Being an entrepreneur is, in part, a chance to get to know yourself better. Are you the sort of person who makes things happen? Or are you the sort of person who really just likes being nearby when things happen? Start a company – you’ll soon find out.
• What's your thought on the start-up culture and innovation coming out of Australia?
I honestly wish there were more do-ers and less consultants. Lots of people talk about the “we help startups” mentality as a business model; in reality, they don’t.
There’s a great book called “The Silicon Valley Edge”; Henry Rowen is one of the editors if anyone out there wants to Google it. The book’s a collection of essays on what makes the Bay Area what it is, and one of the chapters identifies four distinct necessities for an entrepreneurial environment: good universities, abundant venture capital, positive/startup-friendly support services (legal, banking etc) and proximity to people who have been successful entrepreneurs.
Now take each of those items in turn. Good universities? I’ll say yes but with some hesitation. I don’t want to sound old-school, but in my days computer science was taught. Analytical problem solving and discovery. Nowadays I see graduates who learn software development within the confines of a particular language or development environment; things like C# or .Net that create bloated, but easy-to-build applications. But put them in an environment where there are limitations: time, performance etc and they just don’t know how to analyse and solve technical issues. We get some diamonds – I usually try and hire them as soon as I can – but there is a lot of generation of degrees for folks who want to work in MIS jobs, not innovation.
Abundant venture capital? I think many of your readers would identify with the identity issues the VC sector has in Australia. There’s a small collection of large, well-managed, well-connected funds. There are also some well-meaning and active angel investors. But there’s a much larger pool of pretenders who would like to be in either one of these two camps and maybe even pass themselves off as such, when in reality there’s an entire level of mezzanine investment – say $500k to $ 3 million – that just doesn’t exist. We were amazingly fortunate to have the support and commitment of IQfunds from Day one. And bearing in mind that they haven’t actually invested money since a $450K seed round in late 2003 – I simply can’t talk highly enough of their collective and personal support of Locatrix and me as a CEO. Every day. I know other CEOs with investors who were quite simply criminal in their ineptitude, incompetence and all-around cluelessness. The only advice I can offer is to avoid the pretenders and focus on paying customers.
The services sectors in Australia are largely built around a core clientele of government entities, multinationals and the occasional mining company. One of the challenges of the Australian economy is that our primary industries are so big, that folks in the services industry can gain whole careers of experience without setting foot outside our relatively small geographic footprint. Their pricing models and real value add reflect this – so can they help a tiny startup focussed in a telecommunications niche that needs to expand globally? Sure they can charge for time, but do they really add value? Cost, yes – but value? Legal, recruiting, advisory in general – it just isn’t geared towards niche, growing companies.
And contact with successful entrepreneurs? It happens, folks get to know each other, and it’s one thing I genuinely enjoy. Meeting others who have journeyed is far more interesting than those who have just read a travel magazine! But again, do we as a business culture celebrate innovators? Or folks who genuinely move innovations to commercialisation? Not so much – I wish we did.
One anecdote which I find saddening: I rarely, ever, meet another refugee from a tech multinational who has then made the jump to their own company. In the US it happens all the time. Here, working for one of the big companies seems to become a retirement gig. Operational expertise learned in a big company can be so relevant to a smaller technology company, and it’s a skill set I commonly know and hear of as lacking in the entrepreneurial space. I’ve got ideas as to why, but some are unprintable!
• How do you see the mobile battle between iPhone, google (android) & rest of the players?
The most invigorating aspect of the mobile space is that it’s the Wild West – a big, massive market with no dominant sheriff! This environment creates a certain cache of opportunities to differentiate and add value, in such a way that no other industry sector – and I talk from personal experience in computing, networking, and fixed telecommunications – can like the mobile industry. How do I see the mobile battle? As an opportunity!
• What do you think the government (federal and state) should do to improve the culture of innovation and the telecom industry?
I think an expectation that a government body can ever improve a “culture” of innovation is fundamentally flawed. They could always do more to create an economically friendly environment for innovation –brickbats to the Rudd government for killing Commercial Ready a few months back – but to expect even highly-motivated individuals can improve an innovation “culture” from inside a bureaucracy…… no, that’s not it.
There’s a greater cultural issue in Australia that we don’t celebrate or talk about entrepreneurs unless they sit on top of mining deposits or the ASX. Or go to the wall in a public market financial disaster? I met an amazing entrepreneur last week called James Masini – motivated, engaging, articulate and working with some really credible investors. Completely different space from what we do, and while I can’t speak at all about his company I’d bet he’ll be successful. So why, as a rapid consumer of all forms of media and business news in this country, do I know the name “Corey Worthington” but I’d never, ever heard of this bloke?
• Do you have any advice for people who want to start their venture?
I heard a great quote once: Vision without execution is hallucination. Anyone, anyone can have a great idea. What matters is can you, and do you really want to, stay the course even when things get tough? Are you really prepared for how tough things can get in your own company? Execution – making things happen – is a daily grind, and so easy to slip up. If you just want to dream of a blue sky – after all, we all do – stay at home. Making every day, every sales call, every customer interaction, every feature decision, every employee crisis, every payroll things of which you can be wholly proud is what matters. I have never, ever met a successful entrepreneur who made it just by thinking of the blue sky. Dream, get a picture in your head – but then go make it happen. You can’t have one without the other.
For me, it's an amazing journey and one that I’m glad to be on!
Thanks, Mark for sharing your thoughts with us. All the best for the future.
For coverage on other Australian startups, innovation, analysis, and tech trends, check out our coverage on interviews can be found here
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