Google and other search engines help, and tag clouds and other social tools can make it easier to follow other people's recommendations, but wouldn't life be easier if someone was out there on the web scouting for the stuff that you really wanted to see?

Topikality is trying to fill that role. The brainchild of entrepreneurs Phillip Scott and Richard Heycock, Topikality is designed to learn what a user is interested in, and then scour the internet for matching articles that are delivered to the user on a regular basis.

Scott says the key difference is that Topikality presents what you have told it you are interested in, rather than just showing what is popular.

"It looks at everything to do with the articles you are reading, not just specific words — so phrases, words and the context of those words and phrases," he says.

Rather than searching the entire internet, Topikality is restricted to specific sources such as media outlets, blogs, governments and well-regarded organisations. Users can also nominate additional sources.

The value is in the artificial intelligence techniques used — in this case machine learning — which means that the more the system is used, the better it becomes at delivering the right information.

Search tends to be a once-off activity and does not record whether you were satisfied with the result, and hence the search engine does not learn your preferences.

"Once you've done a little training on the system, it delivers results to you ever day," Scott says. "So the net result and return for you increases over time."

Hence if you want to keep up to date on topics such as treatments for specific diseases, it can over time narrow down your interests.

Commentary

There is a lot to like about Topikality. The service, which has entered a public beta, has a clean interface, and the technology appears to do what it is supposed to in terms of dragging back information that you might be interested in.

The company was founded in December 2007 and has been in development ever since. While the technology is not patented, Scott says the sheer hard work and complexity behind Topikality is a series barrier for competitors.

Heycock has a background in mathematics, while Scott has been the co-founder and CEO of Australian customer management company, Prosper Business Solutions, which sold to a US company in 2006.

But it looks like a good idea in search of a business model, and faces two significant hurdles.

Firstly, the founders are uncertain as to how they will make money out of it.

The company is not currently charging for the public beta service, but may look at subscription models for corporate users. The so-called free-mium model is a very difficult one to translate into dollars however, and will require Topikality to find a lot of extra functionality to make it worth companies paying money for it. Just ask the folk at Twitter about that one.

Scott also wants Topikality wants to sell the software as an appliance to companies with large information repositories, and is currently in an unpaid trial with a large media services company that processes hundreds of thousands of documents each day, and has another lined up. The other opportunity is in enterprise search, for information retrieving from the web or intranets.

But herein lies Topikality's other major hurdle. It is playing in a competitive market, against competitors including Google, and there is a good chance that its service can become quickly commoditised (another Aussie company, Isys, has had stored search for years). And with limited sales and marketing resources it will be difficult for the company to make its voice heard amongst the noise.

Scott says he isn't worried about the competition.

"If everyone in the IT industry worried about those things nothing would ever get developed," Scott says. "This is something worthwhile that's worth having a crack at. Who knows that the potential might be and where it will end up."

So while the opportunity is potentially big, until Topikality can batten down a reliable business model, its chances of being a boom company are slim. Thankfully the company is funded by its founders and has a very low burn rate, but at this point the question mark over its potential to generate revenue is a big issue.

• Does it address customer pain? TICK
• Does the technology work? TICK
• Is the business model robust? CROSS
• Does the company have sufficient resources to compete? CROSS
• Is it under threat from competitive pressure? CROSS

bootstrappr opinion: BUST

Comments (0) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Aussie start-up Liaise wows Demo
• B33hive founders start all over again
• Biarri's massive maths mission
• Doing for AV what VoIP did for telephony

Visitors carrying an iPhone 3GS or an Android phone will be able to see additional information about the sculptures thanks to augmented reality (AR), a technology which is transitioning from being a novelty for marketers to a useful tool for delivering location-based information.

The Sculpture application is one of a flood of new AR applications. According to a report by ABI Research, revenue associated with augmented reality is predicted to grow from about US$6 million in 2008 to more than US$350 million in 2014.

Early AR was PC-based and required a user to hold up a special symbol (called a marker or glyph, such as a 2D barcode) in front of a computer's camera, which would interpret the signal and download related information. This would be displayed along with the image from the camera on the computer screen. Typically the AR was some form of animation, such as a 3D character walking around on top of the marker.

Recently, developers have been utilising the power of smartphones to combine AR with location-based information, with new services including Layar, Wikitude and NearestWiki. The technology utilises the smartphone's GPS and compass capabilities to determine the users' location and direction, and presents information such as what buildings of note are in a particular direction.

The Sculpture implementation has been created by Sydney-based mobile developer MOB using the Layar AR browser. Managing director Rob Manson says visitors will receive an enhanced experience at the exhibition.

"It will help them navigate around the exhibition, they will be able to see the key sculptures and find out more about those, and link through to the mobile site," Manson says.

Layar is also adding 3D capabilities, which will enable developers to insert 3D objects into the augmented vision. Manson believes the technology will be of particular interest to museums and art galleries.

"We looked at Wikitude and some of the other applications, but with those you have to build your own application and distribute it," he says. "Layar is more like a browser, so it will be installed on a lot of phones."

Brisbane-based My247 is also preparing an iPhone-based AR version, created by Sydney developer TigerSpike, of its guide to 23,000 restaurants, bars and entertainment venues around Australia. The new My247 application should be available through the iTunes store before Christmas.

TigerSpike co-founder Oliver Palmer says AR enhances what consumers do with the application.

"AR is in its infancy," Palmer says. "Where we see it adding value is in using the hyper-local content that My247 has in its database."

Quick response code company Insqribe has also created a service that enables businesses to create their own AR tags for their physical locations.

"We believe that the opportunity lies in actually bringing to life a platform that is an enabler of AR tagging — presenting tracking and measuring AR experiences," says commercial consultant Nick Gonios. "Insqribe wants to be a platform in terms of delivering the AR experience to existing or upcoming mobile apps."

The company hopes to have its application in the iTunes store by early 2010.

One of the dangers of a proliferation of AR technologies is that the market will fragment into multiple non-compatible technologies, although a proposal exists for the creation of a standardised Augmented Reality Mark-up Language.

"Unfortunately there will be this fragmentation, and then there will be some form of consolidation down the track," Gonios says. "But there are over 100,000 iPhone apps that all do their own thing, so our view is that if your app is designed for a specific function and target audience, that has merit to stay the same, and then in addition you can add AR to it to create a rich experience."

PC-based AR has a much longer history, based on technologies such as Papervision3D, and has primarily been used for online marketing campaigns.

Co-founder of the New Zealand-based digital marketing agency The Hyperfactory, Geoffrey Handley, says his firm has been working with AR almost four years.

Last year it created an AR application for Coca-Cola in Europe that enabled users to play "tennis" with another user. A new project will see The Hyperfactory implement AR in a site for Toyota around the Baja 5000 off-road racing series, using feeds from cameras within the cars.

"We are constantly trying to find a balance between utility and entertainment, and I think AR, if we use it well, is able to strike that balance," Handley says.

Much of what is happening on PCs has been developed in the Flare toolkit, based on Adobe's Flash. Adobe Flash product manager Richard Galvan says that while the technology has been available for some time, developers are becoming more creative.

"For a long time people have been using AR to do some pretty cool marketing campaigns, because there was a wow factor and you could get people to look at it — but once you have seen three or four, they all kind of look the same," Galvan says.

But he points to an application from the US Postal Service to help people determine what size box they needed for posting bulky items as a sign of things to come. The user places an item within the field of view of a camera, with the computer then projecting different size boxes until the user selects one that the item fits within.

At its Max Conference held in Los Angeles in early October Adobe demonstrated numerous Flash-based AR projects, including one from the Australian creative technology business Boffswana (a part of the Omnilab media group), featuring an animated Sasquatch.

Business development manager Paul Curtain says Boffswana has also created AR-based karaoke application for Sony, and a music-mixing application for Wriggly 5 chewing gum in Europe.

"You could print out multiple glyphs and place them in front of a webcam, and each of those glyphs would trigger a 3D asset and a music asset that related to each of the flavours of the gum," Curtain says. "By positioning those glyphs you could ramp up the volume, or adjust the pitch."

Developers have also been experimenting with different media rather than simple markers. At Microsoft's Imagine Cup student develop contest held in Cairo in July a team from Israel demonstrated an interface involving computer-recognisable symbols pasted on the sides of a Rubik's cube. A game was then overlaid, involving an animated character walking across the Cube's surface, which the player could interact with by twisting the sides.

Palmer says future generations of the technology will incorporate image recognition from the handset, so that it need not rely on the GPS and compass features which can be inaccurate in built environments.

"The next release (of the My247 application), when some of the additional functionality is around, will give that interpretation of the images coming through the camera," he says.

But despite the enthusiasm of developers, it may be some time before AR becomes mainstream. According to Adobe's chief technology officer Kevin Lynch, there are still technical issues to be overcome.

"It's pushing the edges of performance of the computing devices right now, like rendering the 3D model and having streaming audio and trying to do the camera detection to find the object on the paper," Lynch says. "That's a lot of computing, and it's just at the point where it is possible to do.

"It's emerging and it's new, and people are still figuring out what to do with it. We will see a lot more of it in our daily life, the blending of physical reality with online reality."

Brad Howarth travelled to Max as a guest of Adobe.

Comments (0) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Adobe Max 2009: Photo gallery
• Adobe snaps up Business Catalyst
• Adobe's licensing needs an overhaul
• Motorola Droid to run Android 2.0?

When the Federal Government cancelled its Commercial Ready grants scheme without notice in May 2008 it cast into jeopardy the future of dozens of Australian technology start-ups. Many were midway through their applications — a lengthy and costly process — and cancellation without notice left them in a worse position than if they had never bothered in the first place.

However, the bigger crime was to cancel Commercial Ready with no viable alternative, and at a time when Australian venture capital markets had slumped. Commercial Ready had provided around $200 million each year to small and medium businesses, which were left to enter the global financial crisis with no clear alternative source of funding.

With one of the reasons for cancelling Commercial Ready being that many of the applications would have proceeded without public funding assistance, it was a slap in the face to companies that would witness private funding options close.

Though this week saw the announcement of a new grant scheme dubbed Commercialisation Australia. The scheme was first mooted in the May budget, and will provide $196.1 million over four years and $82 million each year thereafter. That's a long way short of the $1 billion that Commercial Ready injected into potential high-growth Australian companies.

The new grant scheme will open in early 2010, and will enable companies to access $250,000 for proof-of-concept activity, or up to $2 million in repayable grants for early-stage commercialisation activities. Under Commercial Ready, companies could apply for funding up to $5 million, but only two applications ever received the maximum amount.

Successful applicants will be assigned case managers to assist in the development of their business.

But many entrepreneurs are scratching their heads as to what the new program will actually deliver, and who will comprise the panel of case managers.

"They say they are going to appoint a seven-person board that is comprised of people experienced in growing early stage companies," says entertainment and technology entrepreneur Chris Gilbey. "So that seems promising. But the truth is that it still isn't enough."

The new scheme is important in filling the gap that was left by Commercial Ready — albeit later than most companies would have liked, and in a limited form.

But the fact that it is necessary however simply shines a spotlight on the elephant in the room — Australia's weak venture capital and angel funding capacity. The government has failed to provide any greater stimulus for the private sector (or superannuation funds) to direct funding towards the high growth start-up sector — although in fairness the higher risk in these investments has not been made any more attractive by the financial crisis.

But if any part of the funding process needs stimulation it is the private capital sector. Australia's early stage venture capital investors have shrunk to a handful of battle-hardened investors, groups such as Sydney Angels, Capital Angels and IPitch are working to create stronger linkages between angel investors in the hope of encouraging larger and more frequent investments.

But more needs to be done to encourage funding into the early-stage sector.

Those companies that are capable will raise their funds overseas, such as the Australian online fraud control specialists ThreatMetrix, which this month raised US$6.1 million from a Silicon Valley VC. President and CEO Reed Taussig says the money will be used for operating capital and expansion purposes.

"It's been a difficult financing environment in the United States, but our business has been doubling quarter over quarter, and so as a result we were able to attract a US VC who is a top tier venture firm in Silicon Valley," Taussig says.

ThreatMetrix launched in the US in January and will end this year with around 70 customers, a number that Taussig is confident of coming close to tripling that next year, and move to being cash flow positive in the third quarter of 2010.

Companies like ThreatMetrix demonstrate the sort of growth path that is possible for Aussie tech start-ups. But a lot more needs to be done to stimulate private sector investment — and now is the time.

The story of Australia's venture community is one of investors that have only been able to raise money — and hence invest it — at the peak of the market. The way to generate real returns is to invest now — when valuations are low and market rebound means that returns will be stronger off a low base.

Without an injection of funding now Australia stands little chance of either creating effective solutions to climate change or capitalising on the government's investment in broadband infrastructure. Unless the government can find new ways of unlocking private sector funding, Australia will miss another opportunity to step up as a player in the global technology sector.

Comments (5) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Start-up funding still frozen solid
• Kaz founder: Dumped grants needed for marketing
• Rudd awakening: Govt's plans for ICT
• Innovation grants slashed to save $707m: Budget 08

(Credit: Business Catalyst)

In a further sign that Australian businesses are attracting the attention of larger overseas players, Housman's company Business Catalyst will form part of a new web-based services strategy for Adobe.

Business Catalyst provides a hosted turn-key system for small businesses to run a website, conduct email and online marketing campaigns, and analyse their performance. The software is designed to be sold through website designers, but the company also sold direct to customers through the GoodBarry brand.

Adobe also recently purchased another hosted service, the US-based company Omniture, which makes software for measuring online performance and marketing effectiveness. Adobe has also been redeveloping many of its software products, including Photoshop and LiveCycle, to run as hosted software.

According to Adobe's senior vice president for the creative solutions business unit, Johnny Loiacono: "We're trying to augment what we do on the front end with our tools, to now give back-end pieces that tie these together as a service."

Housman says that he had been in contact with the Australian Adobe team for some time, as Business Catalyst had also built a plug-in for Adobe's Dreamweaver designer tool. He moved to San Francisco in early 2008, and in June that year he met with Adobe management in San Jose. In September he was invited back for a further presentation.

"In November they rang me and said the only way they were going to talk to me further is if they bought the company," he says. "It happened very quickly."

The deal itself, however, involved a very lengthy process of due diligence.

The GoodBarry brand will disappear, with clients soon to be served directly by Business Catalyst. Housman is staying on with Adobe, having spent his working life building start-ups. This included selling his previous business Start.com.au to LookSmart in December 1999.

Housman jokes that his clients had actually thought the sale to Adobe was a joke after he put a notice up on the company website and Adobe didn't immediately confirm the news through its own site. Adobe is keeping quiet on its intentions for Business Catalyst until 2010.

It's a good outcome for the company's shareholders, who faced a long slow grind to build the business into a significant player in its niche. The company sold early in its development, but Housman says he was in no hurry to sell, with Business Catalyst growing well and turning over revenue in the low millions. The company had bootstrapped itself since formation earlier this decade, with no external investment. Sometimes its better to take the money when it's offered.

"We were serving a niche very well, and the only way we could scale that and reach tens of thousands of designers was through Adobe," Housman says.

Comments (0) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Start's spreading the news
• Land of the long white cloud computing
• Aussie start-up Liaise wows Demo
• Start-up outlook: A national disgrace

(Credit: Liaise)

Contrary to my previous assertion that no Australian companies were presenting at the prestigious DemoFall 09 showcase in Silicon Valley last week, it turns out there were two entrepreneurs flying the flag for Australia after all. And they made their presence known in the best possible way: by beating 70 other attendees to be named the best enterprise product.

Silicon Valley-based company Liaise was founded 18 months ago by Australian technology entrepreneurs Sidney Minassian and Alon Novy, and had been operating in stealth mode up until just before its presentation at Demo.

The company's software uses natural language processing to scan email messages for potential action items. Hence an email asking an employee to file a report by "next Friday" can be automatically translated into a work flow.

"There are hundreds of action items that are locked up in our current communication streams — email and text and so on," Minassian says.

He acknowledges that this is a crowded space, with competitors including Gist, ClearContext and Xobni, but says Liaise is different because it adds person-to-person communications to standard time and information management tools, and does not force the user to change the way they work.

"The core value proposition is to help people be prepared and in control — it is about the outcome, such as closing a sale or running a campaign," Minassian says. "And we need to do this without changing people's behaviour. And it needs to be smart and easy to deploy."

Information is captured from email messages automatically, or the user can also nominate specific actions within their communications. The system then keeps track of progress on different items and can generate up-to-date reports. While the software is designed for stand-alone users, Liaise is also launching a web service that will synchronise actions between users.

Liaise is the result of the evolution of the founders' previous Sydney-based company, Think Software (the makers of the collaboration and work-flow product Omniscope), and which continues to operate as a subsidiary of Liaise. This led to the development of Omniscope Mail, which has been sold to clients including Deloitte and the Commonwealth Bank, and became the precursor to the Liaise technology.

The new company has received funding from the Sydney- and Silicon Valley-based venture capital group Southern Cross Venture Partners. It employs 12 people, with 10 in Silicon Valley and two in Sydney.

"Once we came up with the idea three years ago, we really believed this was a game-changer, and we really wanted the best chance to have the biggest impact on the industry," Minassian says. "So we packed up our families and secured the money and came over. We wanted to come where the ecosystem is the strongest to push this through the roof."

Liaise's technology has been made available in a limited beta, although this is currently closed. The software has been initially developed to work with Microsoft Outlook, but Minassian says Liaise will work with other email and webmail clients as well as instant messenger services and Twitter. The company will make money by selling Liaise on a subscription basis.

Apart from the prestige associated with winning the award, Liaise is also the recipient of a US$500,000 in advertising through the publishing company IDG.

Comments (0) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Start-up outlook: A national disgrace
• Aussie start-up execs hit Silicon Valley

No Australian companies were selected to be a part of this year's TechCrunch 50, and no Australian companies will be participating in the prestigious DemoFall 09 showcase this week.

The fact that Australia won't be represented at either of the globe's pre-eminent showcases for emerging tech companies should be considered a national disgrace. If this was the Olympics, politicians would be offering teary apologies and millions of dollars would be thrown at a new Institute or something.

Actually, millions of dollars have been thrown at a new institute, Senator Kim Carr's $196 million Commonwealth Commercialisation Institute, which was announced in 2009-10 budget. But we are yet to see any concrete plans of what it will offer, and no one seems to be in any rush to put something into play. I wouldn't count on an AIS-scale organisation here.

One of the Aussie DEMO alumni has made the grade, however, with the announcement of the sale of the DemoFall 2008 exhibitor Xumii to the European company Myriad Group.

The sale of Xumii, which makes web-based software for mobile phones, is likely to be typical of the fate of the majority of Australian tech companies for the foreseeable future. With venture capital sluggish and public markets closed to start-ups, trade sales to larger businesses will be the most common exit for weary investors looking for a return on their money.

Serial internet entrepreneur Domenic Carosa, the man behind Destra until the Opes Prime debacle saw it taken away from him, is building his new business around the idea of acquiring small technology start-ups and nurturing them to be sold to larger listed businesses.

If entrepreneurs still have stars in their eyes about one day leading listed businesses, most will need to reset their expectations pretty quickly.

Myriad is a French/Swiss company listed on the Swiss stock exchange, and is a roll-up of a series of different mobile technology companies, working with technologies such as Java, instant messaging, browsers and hash codes, with clients primarily in Europe and emerging markets. The company employs more than 800 people, including 700 engineers.

Xumii's technology uses a cloud-based service to aggregate multiple social media sites and instant messenger services on the handset, based around a hosted contact list. According to CEO Jennifer Zanich, the sale gives Xumii a much louder voice.

"To be part of a public company with such great customer relationships creates an enormous opportunity for Xumii," she says. "One of the challenges of being a start-up is getting large telcos and mobile handset makers to take you seriously. Now that we have the back of Myriad the question of longevity goes away and the focus is on the value of the Xumii Service to the customer."

Xumii has previously been funded by the Australian venture capitalists South Cross Venture Partners and CM Capital. Zanich says that a trade sale was not the only option available to the company, but selling to Myriad presented the best opportunity to get the technology into the market quickly given how rapidly the mobile social networking is moving.

Zanich will stay on to run the Xumii Services division of Myriad, with no changes to its 17 staff, including its Sydney-based engineering team.

Myriad's chief commercial officer Steve Langkamp and his company had been interested in acquiring a social networking technology for some time.

"Facebook recently reported 65 million mobile users," Langkamp says. "This is a massive wave, and the manufacturers and the network operators are eager to ride this wave.

"Our ultimate goal is to push the Xumii application deeper into the phone with our manufacturing partners, rather than just being a download, which enables it to do more," Langkamp says. "The ultimate goal is that we deliver a social phone book that is the core of the phone."

He declined to discuss the revenue that Myriad is likely to make from Xumii, but says the goal is to have the software embedded on phones by Christmas 2010. Commercial terms for the deal have not been disclosed.

"Today it's difficult to imagine a phone without SMS," Langkamp says. "In five years it will be difficult to imagine a phone without social networking, but it is going to take five years."

That Xumii was able to attract the attention of Myriad was no doubt assisted by its appearance at DEMO. Another Australian company which appeared at DemoFall 07, mig33, secured US$13.5 million in a funding round led by Valley investor DCM in January 2008.

No Australian company has made it into the TechCrunch 50, although Tangler, Spellr.us and PeopleBrowsr have exhibited in the so-called DemoPit.

Presenting at DEMO is no guarantee of success, with another DemoFall 07 presenter, kannuu, apparently flaming out about a year ago. But standing on the podium or accepting an Oscar is considered a big enough payout for the money and effort that goes into the Australian Institute of Sport and the performing arts community.

Even a little recognition of the achievements of our entrepreneurs would be nice — especially when the trade sale will generate more money for the Australian economy than a bronze medal in the 100 metres backstroke.

Comments (25) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Aussie start-up execs hit Silicon Valley
• Duel of the fates: Atlassian and Omnidrive
• Spellr.us needs a new dictionary

Ben Keighran made his name in the US a couple of years ago with Bluepulse, a mobile messaging and content service that raised US$6 million from the Valley-based VC (venture capital) firm VantagePoint. In 2007, Keighran even got himself named by BusinessWeek as one of America's top entrepreneurs aged less than 25.

He exited Bluepulse with a wad of cash more than a year ago — the service has since been re-branded as aphoot and is focusing on developing markets. Keighran has been taking some time out professionally while still playing with a couple of business ideas. But he says he is now ready to jump back into building a business again, probably in the mobile sector.

And he will do it from Silicon Valley. The last two years have seen an explosion in interest in mobile applications and services in the US, fuelled in part by the emergence of the iPhone as an application development platform. However, Keighran thinks that the future may lie with web-based applications that run on any handset.

Marty Wells got to San Francisco two years ago with Tangler, an Aussie start-up that creates commenting software for online forums. When it became clear that Tangler itself would never become a major destination on the internet, the company shifted focus to selling its technology to other companies. Wells handed the reins to co-founder Alex von Kotze, and became vice president of the Australian mobile messaging start-up mig33, which had raised US$23 million from VCs and boasts 25 million registered users.

Mig33 has since switched its headquarters to Singapore, but Wells is staying on in San Francisco.

"It's not for the faint of heart," Wells says. "Competition is fierce, and whilst I found it easy to gain surface level relationships with people, accessing the core power groups has been a long and slow process of having to prove my worth, and maybe just a little of proving that I'm here for the long haul. There are so many transient people coming to put their toe in the water and ultimately not stay, that I can see why this culture has emerged."

"My intent with coming here was to jump into a bigger pond, and the more time I spend here the more value I get from it. I wouldn't swap the experience for anything."

Another Aussie to base himself in San Francisco is Chris Saad. Saad was the co-founder of Faraday Media, whose Particls technology was designed to help consumers track their favourite websites by alerting them when their content changed.

He is also part of the team behind the DataPortability Project and co-created Attention Profiling Mark-up Language (APML) along with Faraday co-founder Ashley Angell. These days he is vice president of product and community strategy at JS-Kit, creators of an online commenting system called Echo, and has subsequently pulled away from Particls.

Meanwhile, Omnidrive founder Nic Cubrilovic continues to work with TechCrunch founder Michael Arrington on the forthcoming CrunchPad tablet PC.

One thing they all talk about is the comparative ease of running a start-up and doing business in the San Francisco Bay Area. Lawyers, accountants and banks are all geared towards the needs of pre-revenue companies — you don't need six months of financial records to sign a lease.

But according to another San Francisco-based Australian, Elias Bizannes, many of the benefits of Silicon Valley are psychological and social in nature.

"In Australia it's about catching up, whereas here in the Valley it's about disrupting and innovating on a global scale," he says. "The brilliance of this place is that it has people from all around the world, and are all self-selecting people, who want to achieve common things in their life."

Bizannes is working in San Francisco as manager of the finance department at vertical search engine vast.com, but was also the creator of the Silicon Beach community for Australian technology entrepreneurs.

As fond as he is of his home country, he says the opportunities in the US are just too alluring.

"The difference really comes down to the fact Australia doesn't have a critical mass and concentration," Bizannes says. "But rather than wait 10 years before we get to a stage where we can be proud of our local industry, people like me have decided to experience life overseas and get some actual experience."

"The secret to the Valley is through a multitude of alumni networks, where people cross-collaborate and invest in each other. Australia doesn't really have that, but with time I'm sure we will."

Comments (0) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Duel of the fates: Atlassian and Omnidrive
• Silicon Beach Australia

A call around of technology entrepreneurs and investors in Australia suggests the market for tech IPOs is still frozen over.

The performance of Adelaide-based Digislide itself as a listed stock has done little to prompt a thaw. The company had a shocking debut, even having delayed listing by seven months from its original date. Its $1.25 stock came onto the market at 80 cents and plunged to under 40 cents through the week. It has now regained some ground, sitting at 47 cents.

Chief executive Luceille Outhred says that she is not overly concerned with the poor debut, believing that it reflects a number of long-term shareholders — some of whom invested in the company 10 years ago — liquidating part of their investment at any price.

"That will settle down, because there aren't that many shareholders who bought in 10 years ago," she says.

Outhred, however, says the current share price is valuing the company's past, not its future. Of course that's little comfort to the folk who spent around $4.5 million buying stock at $1.25 a piece.

The listing has had many pundits scratching their heads, in terms of exposing itself to the market for such a small raising. According to Dean McEvoy, founder of the online books service Booking Angel: "It's terrible that an Australian company had to list to raise $3 million (sic). All that paperwork and reporting for something about the size of an angel deal in the US."

Outhred says being listed provides benefits when working with foreign partners, and gives it another option for making acquisitions.

It's unlikely that too many more tech markets will go to the public market this year — if any. Listing a company is an expensive exercise on an ongoing basis, and if the company fails to raise the capital it needs to become profitable, it is in danger of being punished later by shareholders.

The investment principal at venture capital company Starfish Ventures, Michael Panaccio, says the Digislide listing gives little indication as to whether the market is interested in other tech stocks.

"There's no doubt that because we've gone through a sustained run that there is a possibility that the IPO markets have opened up, but until there is a significant raising, we won't know," Panaccio says.

A lack of money in the public market would not be such a problem if there were funds available in the private market. But unfortunately the venture capital industry is hardly handing out cash at the moment either. Only a handful of companies, including Starfish, are investing in new companies now, and those deals are being done slowly and carefully.

And with no replacement for the Federal Government's Commercial Ready program likely to emerge any time soon, the funding picture for Australian tech start-ups remains as bleak as ever.

Comments (6) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• B33hive founders start all over again
• Aussie start-up Enikos up for sale
• Duel of the fates: Atlassian and Omnidrive
• Rethink Visionstream disaster, Telecom

(Credit: Beehive)

Director Andrew Cuccurullo confirmed that his company sold its premium online content business and assets a month ago to a privately-held Australian company, although he declined to name who it had been sold to and at what price.

ZDNet.com.au last covered B33hive back in 2003, when it was attempting to use SMS messages to deliver mobile applications.

Money from the sale has been used to fund the new service, called iTweeVee.com, which launched in the US in July. Cuccurullo describes it as a real-time discussion forum for television enthusiasts, consisting of an electronic program guide wrapped around Twitter. Users of iTweeVee.com enter the name of their local cable television company, and are then presented with a program guide and tweets relating to those programs.

Cuccurullo says the switch in business model followed the realisation that the company's original idea of creating and selling mobile content simply wasn't going to work over the long term. So 18 months ago his team began exploring other opportunities.

"We didn't feel that there was a future in that model, and we found that the demand for that type of product was waning pretty quickly," Cuccurullo says. "We've gone into uncharted territory, but we had to. We either waited to see our stuff die, or we go into start-up mode again."

B33hive was originally founded in 2003, and its backers included the founder of the research company www.consult, Ramin Marzbani, and Greengrocer.com.au founder Doug Carlson. Cuccurullo says Carlson is still active in the business today.

The company's first attempt to relaunch was a US-based television community for mobile phone users called HollerTV, but Cuccurullo says this failed to take off.

"But we did a lot of research that showed people wanted to talk about shows with each other, but weren't connecting," he says. "There was nothing out there specifically for it, and that's why we went down this track of launching this project off Twitter."

We did a lot of research that showed people wanted to talk about shows with each other, but weren't connecting

B33hive director Andrew Cuccurullo

Cuccurullo believes the company can make money from several streams. One is providing research on conversations for television networks and studios, and by providing a sales channel for downloads. Another potential source is sponsored tweets from advertisers.

"We also want to go down the model of distributing the technology as well," Cuccurullo says. "There is a fair bit of technology behind it, but we are doing it on Amazon's S3 (Simple Storage Service) so we can scale it up as the demand gets heavier."

Cuccurullo acknowledges the difficulties that companies have found in monetising online communities, but says that Twitter is only a starting point for the company. "The biggest determining factor for us was 'is there a conversation going around television within a community', and we've proved that with what we've done here," he says. "We have a site that's full of content, and now it's about engaging more and more people into that conversation."

iTweeVee.com is planning to launch in Australia before the end of September with the backing of a local television network.

Commentary
Many start-ups will go through several different business models before funding one that makes money.

With the limited detail that has been revealed about this new venture, it's impossible to say yet whether this is the model that will set the B33hive team on the path to success. Television is already a much-discussed topic online, and if it was only the Twitter community, the answer would definitely be a bust. But Cuccurullo says there is a whole lot more in store.

With money in the bank, an experienced management team and a low-cost starting point, the company may have enough runway ahead of it to put its new thinking to the test — or at least change model yet again. Bootstrappr is reserving judgement, but will be checking in again to see how they are progressing.

Comments (0) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Aust company backs SMS for music, info services

(Credit: Enikos)

Tasked with finding a buyer for Enikos' assets is serial entrepreneur Mike Nicholls, who joined as chief executive 18 months ago with a brief to sell the intellectual property of the company, not to build an operating business. That meant first turning the technology into a prototype product, the Enhanced Media Platform (EMP), a cloud-based service that enables users to combine audio, video, web pages and other forms of digital media into multimedia presentations.

Nicholls says he is only engaged in Enikos for three or four days each month, but confirms that discussions to sell the IP are underway. In July the Allan & Buckeridge-funded company had one of its patents approved, and a further eight are currently being processed, some of which relate to key parts of the MPEG standard.

"We're in the process of trying to monetise those IP assets," Nicholls says. "There is some pretty valuable IP around the MPEG standard and around things like session mobility between devices such as your iPod or a TV or a PC."

Nicholls, however, hasn't been sitting on his hands. He is on the verge of taking the covers off a new business, MortgageCorp, an online mortgage broker, calculator and home loan finder that compares 600 loans from 25 lenders.

He says there are some similar services around, but says usually these sites do not reveal who the lenders are, and require you to meet with a representative. Nicholls says MortgageCorp provides that information online, fulfilling his idea of streamlining the process of mortgage broking.

Nicholls says he spent three months achieving the necessary accreditation and is now almost ready to set the service as live.

Commentary
A good entrepreneur should have the skills to not just grow a business, but to know when and how to close one down as well.

While start-up entrepreneurs are generally praised for their successes, good entrepreneurs also have the skills to know when it's time to pull the plug. It's not as glamorous as an IPO or a trade sale, but selling off or licensing out the intellectual property of a start-up can still ensure a return for the investors when it's clear that the business will never fly. Especially when you consider that most high-risk start-ups are doomed to fail.

In the case of Enikos, Nicholls says it's unlikely that the business would have ever attracted the funding necessary to succeed as a video and advertising business on an equal footing with US-based competitors such as Brightegg.

No word, however, on how much money was sunk into the business, but at least by selling now the investors are likely to get some return, rather than running a higher risk in building the company by investing further, potentially for zero return. It's not a great outcome for the investors, but nor is it a total write-off — although it remains to be seen what a potential buyer will value those assets as worth.

MortgageCorp, on the other hand, is relatively low-risk. It has been funded by Nicholls himself, and while it's too early to say whether it could ever deliver a massive windfall, it could at least become a solid business based on commissions for the loans that it will broker.

Comments (3) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Duel of the fates: Atlassian and Omnidrive
• Biarri's massive maths mission
• Cash cow in a BigTinCan?
• Doing for AV what VoIP did for telephony

Nik Cubrilovic
(Credit: Nik Cubrilovic)

On 19 July Omnidrive founder Nik Cubrilovic made a rare reappearance on TechCrunch with a lengthy post discussing the recent hacking attack on Twitter and subsequent decision by TechCrunch to republish information that was stolen during that attack.

Cubrilovic has kept a low profile since the collapse of Omnidrive, the online storage company he founded in late 2004. The company folded in 2008 with no clear explanation given for what had happened. It was the second online storage company founded by Cubrilovic to fail, following the earlier collapse of MyVirtualDrive, although Cubrilovic has claimed to have been forced out of that company.

The failure of Omnidrive left at least one investor, Vibe Capital co-founder Clay Cook, US$100,000 out of pocket. His subsequent attempts to recoup his investment (which was made in the form of a convertible note) were abandoned, with Cook writing it off as a "valuable life lesson".

In the meantime, Cubrilovic is living in California and working with TechCrunch. He is involved in the development of the CrunchPad, a prototype tablet-PC style device for surfing the web that is intended to retail for less than US$300. No decision has been made on whether the CrunchPad will go into full production.

It's an entirely different story to that told by Atlassian. Despite the relatively chilly climate for software companies, Atlassian is looking to hire an additional 35 developers to continue work on new products and features based around its core wiki software.

Founded in 2002 by Mike Cannon-Brookes and Scott Farquhar, Atlassian has already grown to employ more than 200 people with offices in Sydney, San Francisco, Amsterdam and Poland, and sales in over 74 countries. And it has grown without taking any significant external investment. According to Atlassian's director of engineering, Soren Harner, it makes sense to be investing while other companies are tightening their belts.

"We've got the sales to support more investment," Harner says. "The idea is that we can emerge from global recession in a good shape relative to any competitors. Obviously there is always risk involved, but at this point we can assume the bottom isn't going to totally fall out of the global economy."

The new engineers will work on features designed to entice customers away from rival open source products. Harner hopes to have the new positions filled by the end of the year, taking the number of developers Atlassian employs to close to 130.

Commentary
The tales of Atlassian and Omnidrive demonstrate just how varied the outcomes for entrepreneurs can be. In 2006, Cannon-Brookes and Farquhar were named by Ernst & Young as Australian Entrepreneurs of the Year, and are the strongest success story from Australia's crop of Web 2.0 businesses.

Cubrilovic meanwhile has been the subject of several flame postings (such as here, here, here and here) with claims of salary disputes and poor customer service. Cubrilovic has never publicly explained the reasons why Omnidrive failed. His personal blog at nik.com.au is unattended, while the Omnidrive domain name is redirecting to the document collaboration software maker NomaDesk. I'm still hopeful that he may agree to an interview to talk about Omnidrive and his current work.

Australia generally has a low tolerance for failure — certainly much lower than in Silicon Valley, where having failed in one or two businesses is seen as a learning experience rather than a sign of incompetence. This, coupled with the poor state of Australia's venture capital industry, means that any experience gained through a failure is generally lost, with entrepreneurs either leaving the country or moving into different industries where their reputation does not necessarily precede them.

Atlassian, meanwhile, has continued to show the way for other would-be software exporters, demonstrating that it is possible to build a successful international business without turning to the venture capital market.

Start-up companies are high-risk by nature, and the truth is that most will flame out before they come close to emulating the success of Atlassian.

Comments (3) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Memory Box splits up backup headaches
• Omnidrive: Alive and kicking?
• Webjam 8 Photo Gallery
• Omnidrive website vanishes

New start-up Biarri reckons it has found a way to give even small businesses access to some of the most powerful mathematical modelling tools available, to solve complex problems simply and at a price more people can afford.

(Credit: Biarri)

Each year the mathematical discipline of operations research saves large companies millions of dollars by helping them optimise complex problems. It was originally used by Allies during the Second World War to determine the best means of organising North Atlantic convoys to avoid attacks by German U-boats.

The heavy mathematical processing required for modern operations research means that today it has typically been used by large companies such as airlines, miners and transport companies, and has been out of reach of smaller business.

A simple example in the transport industry is calculating the best sequences of deliveries for a van that is carrying 50 different items; as the number of possible sequences starts to rival the number of stars in the galaxy. It is commonly used to optimise supply chains, predict customer behaviour, or conduct rapid analysis of complex sets of data. And it requires a lot of computing power.

Biarri co-founder Joe Forbes says his company has found a way of making operations research affordable for a much wider range of business. Rather than purchasing dozens of servers to run the mathematical algorithms, it purchases computing power from Amazon's Elastic Compute Cloud (EC2) to do the hard work.

Now it is developing a web-based service, dubbed Workbench, which will enable customers to access its tools via the internet, effectively moving the entire process of operations research into the cloud.

Forbes says that Biarri has conducted more than a dozen custom projects for clients since it was founded in January, building up a repository of different modelling engines that are suited to solving specific operations research problems.

The Workbench service, which is expected to go live before the end of September, will include models for a wide range of tasks including production planning, staff scheduling, and yield or portfolio optimisation.

We are trying to make it accessible and to democratise mathematics by making it easy to get your hands on

Biarri co-founder Joe Forbes

"We are trying to make it accessible and to democratise mathematics by making it easy to get your hands on, with a GUI and a database that everyone understands," Forbes says.

Forbes says that while the online service will most likely meet no more than 90 per cent of the exact requirements of many customers, he believes the reduced price will see them happy to accept this trade-off.

For those that want a fully-customised outcome, Biarri is continuing to deliver tailored projects, and the software can also be customised and installed within the systems of clients who want permanent access to operations research capabilities. For the rest, Forbes believes the Workbench will be affordable for smaller business, such as delivery companies with fleets of around 10 vehicles.

"It's to do with the economics of cloud computing — if we'd started Biarria two years ago we'd have hundreds of thousands of dollars on equipment to host things," Forbes says. "That enables us to take all this clever stuff that has been around a long time and make it cheap and accessible. And our challenge is to make it usable and fast."

Commentary
There is nothing new about operations research. What is new about Biarri's service is that it will be affordable for a much wider range of companies,

The company is already making a living conducting bespoke operations research projects for clients on a consulting basis. Each time it does it learns something new that it can feed into its cloud-based solution. And there is demand out there. Biarri has doubled in size to six full-time employs since January, with another 10 casual workers.

The next big challenge will be convincing smaller businesses of the value of operations research, and getting them to use the web service. But given the company is already profitable, Forbes says he isn't even including online revenue in his business model.

"That's the blue sky part of the business, but we can survive without it," Forbes says.

It's a nice position to be in.

bootstrappr opinion: BOOM

Comments (1) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Reaction round-up: Conroy's digital economy opus
• Future direction trapped in halt state
• Cash cow in a BigTinCan?
• Doing for AV what VoIP did for telephony

(Credit: Audinate)

The tangles grow exponentially when connecting up live audio in massive venues such as concert halls and stadiums, where hundreds of so-called XLR or cannon connectors connect the microphones, mixers, amplifiers and other equipment. A single drum kit can have up to a dozen microphones, each of which has its own cable running back to the mixing desk.

Sydney-based start-up Audinate is hoping to bring order to chaos by scrapping traditional analog cabling in favour of the same TCP/IP-based networking technology used to hook up office computers.

According to chief technology officer Aidan Williams, it's not just as simple as just plugging the mikes, amplifiers and mixing desks into a networking switch, as IP networks were never intended for real-time transmission. While it doesn't really matter if an email gets delayed by a few milliseconds here and there, for audio and video signals, the disruption can be significant.

"We are talking latency that is 20 times less than is acceptable in Voice over IP," Williams says. "When I talk to you, you don't mind if there is 10, 20 or 200 milliseconds worth of round trip. But if you were singing, or a drummer, that would freak you out. Or if you had a bunch of speakers in a stadium and they weren't properly time-aligned, the sound would be really muddy."

Converting an analog signal into a digital one suitable for transmission over an IP network takes time — albeit a very small amount — and keeping those signals synchronised across dozens of different inputs and outputs has been one of the problems that Audinate has solved.

Often analog signals are converted to digital anyway for modern mixing equipment, and then reconverted back to analog again, adding noise and delays. Audinate ensures that digital translation takes place only once.

Audinate's IP technology, dubbed DANTE, means one cat-5 networking cable can do the job of 500 analog connectors, removing tonnes of cabling from large installations. Williams says the deployment of an IP network based on DANTE is a tenth of that of an analog network.

He says another goal of DANTE has been to ensure that it is easy to use. "IP networks are typically run by IT guys, and your average installer in the AV space is not usually an IT guy," Williams says. While DANTE currently operates on switched networks, the company is extending the technology to work across routers, meaning it could handle the audio requirements of an entire campus across a wide area network.

Commentary
Audinate's DANTE has been in development since 2003, starting as a research project within NICTA before being spun out as a separate company. It has also received funding from venture capital firms Innovation Capital and Starfish Ventures.

The technology has already had a number of hefty work-outs, being used for distributing audio at the premiere of the latest Star Trek film at the Sydney Opera House, and for the various events for World Youth Day, including an address to 200,000 spectators at Randwick Racecourse.

While the technology is ideal for temporary installations, chief operating officer David Myers believes the bigger market is installation at new venues and refitting of old ones. He believes there are also opportunities in the broader construction industry, to carry public address systems and alarms on DANTE-based IP networks in shopping centres and office buildings, allowing telephony, data and audio to all be run over a single network.

The company has already signed an agreement with Yamaha to distribute its technology, and hopes to see manufacturers licence its designs to incorporate in their technology. It has already been incorporated into processors used by Dolby. In June the German company Bosch, which has a large slice of the public address systems market, announced that it had adopted DANTE as its strategic networking technology, with products to start coming out over the next year.

DANTE is a good example of how lateral thinking can see technology from one industry used to solve a problem within another. Audinate is not the first company to propose using high-performance IP in audio, but is the first to do so in a non-proprietary way.

Its biggest hurdle is to educate audio engineers to embrace IP networking, but the enthusiasm with which Yahama and Bosch have adopted it indicates that they see a strong potential market.

bootstrappr opinion: BOOM

Comments (1) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Memory Box splits up backup headaches
• Punchcard: 3D modelling for the rest of us
• Aussie phone for disabled wins recognition
• iAwards winners announced

Now Adelaide-based start-up Punchcard is hoping to bring 3D modelling skills to the masses with VideoTrace. Managing director Anton van den Hengel says the big advantage of VideoTrace over other 3D modelling tools is its ability to create 3D models from 2D video images without any real training of the user.

Instead, the user traces the outline of the object over one or more frames of the video footage, and the software uses computer vision techniques to extract all of the 3D information out of the 2D images. "We were just hoping to make modelling easier, but at the time it became clear that we could make it easy enough that ordinary people could generate 3D models," he says.

VideoTrace is certainly not the only product that can do what it does, and it competes with commercial software such as PhotoModeler and Autodesk's ImageModeler. However, van den Hengel says that neither product is designed for ordinary people.

"They are very powerful tools that do a great job, if you are willing to put in the yards to learn a very complicated interface and put in all the information yourself," he says. "The difference with VideoTrace is that the interface is very simple, and that's because we've automated all of the image analysis."

VideoTrace also competes with Google's SketchUp, but van den Hengel believes it is much easier to use, particularly if the user is modelling something real, such as creating an accurate representation of their own house using texture maps.

VideoTrace is currently available in a closed beta from Punchcard's website. Van den Hengel hopes to have it available for general release by the end of the year, both as a free version for the public, and a paid version for professional designers. This is the same model that he says makes SketchUp profitable today.

The technology emerged from the Australian Centre for Visual Technologies, which conducts research into image processing and computer graphics at the University of Adelaide, and was created with the help of an AIC Discovery grant. More recently it received a COMET grant to further its commercialisation.

Commentary
The technology is patent-protected, but van den Hengle is in a race to bring it to market before Google improves SketchUp, or Microsoft releases its own efforts in consumer 3D modelling. It has already taken two years to spin VideoTrace out of the university and into its own company, and further delays could see it passed by in the market.

Working in VideoTrace's favour, however, is strong public interest. Google Earth and Second Life have raised the public's awareness of 3D environments and modelling, and Australia has a strong 3D development community already, thanks to local companies ExitReality, VastPark and Mycosm. Van den Hengel says when the software was first published to the university's website it was crashed by the demand for downloads, while his own email was flooded by messages of interest.

He is continuing to get strong interest from sectors including games developers, architects, defence and even people associated with forensic reconstruction. Right now what he is looking for is a management team to continue commercialisation of the technology, leading towards a planned capital raising.

The biggest barrier seems to be finding the skills necessary to get the software ready for general consumption, and then propagated out to enough users quickly enough to stake a place in the market. It's a very big task.

At the same time, there seems to be growing interest in more immersive web interfaces and 3D modelling. If Punchcard gets its act together quickly, it has a good chance of creating a very popular product.

bootstrappr opinion: BOOM

Comments (0) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• ExitReality's CEO exits, really
• Virtual world makers turn to Google Earth
• Google SketchUp

(Credit: Memory Box Backup)

But history has shown that trusting your data to the hands of a single service provider still may not ensure its safety, especially in the event of a cataclysmic failure. The apparent collapse of online storage company Omnidrive last year is a good example of the potential for problems.

So what if you could store your data in a hundred different locations at once? That is what South Australian start-up Memory Box Backup is proposing with its soon-to-be-launched service.

Memory Box is a distributed backup solution — meaning that rather than data being stored in one location, files are broken into a hundred different pieces and stored in a hundred different locations. It is the brainchild of a team of five former software engineers from Motorola's South Australian software engineering lab, led by current managing director Trevor Glen, who have been working on the technology for five years.

A user selects the files they want to protect on their own drive. The Memory Box service then splits them up, encrypts and compresses them, and the resultant bits of files are distributed for storage on the hard drives of other users. Each user donates the equivalent space on their own hard drive to host data from other users, and also pays an as-yet undetermined monthly fee.

Additional redundant information is added to the data to ensure it can be reassembled — even if some of the devices that it is being stored on are switched off. Glen likens the technology, known as Reed-Solomon error correction, to a way that a CD can be played even if the surface has been scratched. He says Memory Box could lose 30 per cent of its network and still be able to recover 99.96 per cent of its backups.

"On a nationwide network, that's the equivalent to someone wiping out NSW completely, and we'd still be able to recover over 99 per cent of people's backups," Glen says.

And because the data is encrypted and compressed at the time it leaves the customer's hard drive, Glen says even his team cannot see its content. Also, unlike storage services such as Gmail or Windows Live Storage, the Memory Box service will automate the backup process for nominated files on a daily, weekly or monthly basis.

To date the company has been self-funded, with revenue coming from contract software engineering work under the company name Sarugo, and has been helped by a COMET grant from AusIndustry and some training assistance from the South Australian Government. Unlike other storage services companies, Glen says Memory Box has also benefited from not having to invest in a datacentre of its own.

Now, however, he is looking for between $200,000 and $500,000 to help the company through its commercialisation phase.

Memory Box is currently going through beta testing of its new user interface, and Glen hopes that the service might be live by the end of July. He has also been talking to ISPs about reselling the service, and hopes to complete a deal before the end of September. For the moment the website has a form where interested potential users can leave their details.

Commentary
Timing may work in Memory Box's favour, with ISPs more willing to un-meter specific services on their network to get an edge over competitors, and with networks reaching speeds necessary to make online backup efficient. The NBN will further boost Memory Box's cause, depending on how quickly it is built.

The company got a boost recently when it was awarded the AIIA's iAward for the best start-up of the year.

But regardless of the quality of the technology or the appeal of the service, Memory Box faces one significant potential problem — human nature. To succeed, the company has to ensure that consumers feel comfortable with their data being resident on the hard drives of strangers.

Glen is confident of Memory Box's 128-bit encryption, and points out that only a fraction of each file is sent to any individual hard drive — making it essentially impossible to reconstruct anything meaningful. But he is aware of the potential for mistrust that may sit with consumers.

He acknowledges that there is still a lot of thought that needs to go into the marketing. But that realisation in mind — and the low operating costs for the business — means they may just have a shot at making this work.

bootstrappr opinion: BOOM

Comments (0) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Omnidrive website vanishes
• Omnidrive: Alive and kicking?

Rhys Cooper became aware of this during the five years he spent working with intellectually disabled adults. Modern mobile phones were simply too complex with too many options to be used easily. So last year he formed a company, Orange Dot, and set about creating a new type of phone that would be usable by a wide group of both intellectually and visually disabled people.

Earlier this year he built his first prototype based on a touchscreen phone from HTC, and then in May was named the winner in the Freelance category of the MEX Mobile User Experience Awards in London.

Cooper says winning the award has been useful for raising Orange Dot's profile as it begins actively testing its prototype. Orange Dot's work consists primarily of a new user interface for the phone, which features nine large pictures of the most frequently called people in the user's directory. The interface can scroll through to more users, or can display a large-format dialling pad.

All menus have been eliminated, and the interface is locked, meaning that it is impossible to accidentally delete contacts from the handset. The handset will also speak the name of the person being called to provide an extra level of feedback.

"No matter what they are doing on the phone they won't affect the integrity of the interface and can't accidentally delete their contacts," Cooper says. Orange Dot is also developing a physical grid that can be layered over the touchscreen to give tactile feedback to visually-impaired users.

Contacts can be remotely updated on the handset, and Cooper has also developed an application that transmits the location of the handset to a third party at regular intervals or at the request of the user. However, he says there are still some privacy considerations to be worked out with this feature.

"Obviously if they are blind or lost they can't read a street sign, the idea is that the device tells the person on the other end where they are via a map," Cooper says.

The company is now in its testing phase, and Cooper hopes to have a version of the software available for commercial download this year, possibly paired with suitable grid overlays. "We're happy with the progress that we've made, and we are getting a lot of positive feedback," Cooper says. "I'm confident that by the end of the year we'll have something."

Cooper is looking at different ways of getting phones to market, possibly as a downloadable application that can be paired with a grid. Orange Dot has received ongoing support from HTC in terms of handsets, although Cooper says he has not ruled out working directly with a manufacturer to create phones directly to Orange Dot's specifications.

"That would be the ideal, but if we can release something that still delivers our interface in a form that provides value to the users, we'll still do that," he says.

Cooper was a participant in the 2008 Mobile Enterprise Growth Alliance (MEGA) program, a not-for-profit entrepreneurship and mentoring program for people with ideas for new mobile phone content and applications. The next round of MEGA will take place in Victoria, and applications close on 5 July.

Comments (2) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Telstra Turbo 21 modem
• Nokia E63
• HTC Touch HD
• BenQ Joybook Lite U101

(Credit: Social Horizon)

One innovation that has not had the same prominence is mapping — although anyone who has used the combination of Google Maps on the iPhone will know what a genuinely useful tie-up that is.

Generally, one of the problems with maps is that the length of the URLs that accompany them make them difficult to work with. For example, pasting a map URL into Twitter in its native format is next to impossible without overstepping the 140-character limit, and while you can use services such as bit.ly and TinyURL, this requires an extra step, and doesn't tell the user that what they are clicking on is actually a map.

So the team at Brisbane-based Social Horizon came up with aMAP.to, which they believe is the world's first service that shortens Google Maps URLs down to something manageable. Users go to the service's homepage and create their map, then click to create a link that is expressed as something like this — ready to be cut and pasted anywhere you want. The site also has Twitter and email functions built-in so the new links can be shared immediately.

aMAP.to is the brainchild of Huw Griffiths Scollay Petry and Jack Gonzalez, the founders of Social Horizon, who have previously created the gay travel site Qguide.com. The service makes a small amount of money by referring visitors to a hotel site, but Griffiths knows that Social Horizon will never make a fortune from aMAP.to. Nor is he too concerned that someone else might come along with a similar application. But then that's not the plan.

Griffiths says aMAP.to is just an idea spun out of the company's longer term plan to create niche social communities around travel. aMAP.to makes it easier for community members to share maps of their favourite travel places, and as word spreads, hopefully so too will interest in the company's other projects.

And it is starting to catch on, with businesses starting to use it to help promote themselves, such as this one.

The so-called "Free-mium" business model of giving away basic applications in the hope of hooking users into paying for something better later is a common, if much derided, way of getting a company going these days. However, in terms of having a simple idea that should be able to deliver traffic back to the main business, Social Horizon could be on to a winner with aMAP.to.

Comments (4) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Google Wave: Screenshots
• Google ushers in Sydney-built Wave
• Head to head: iPhone vs Palm Pre
• HTC Touch 3G

McGregor Dey's company, QMCODES, has developed technology that makes print advertising interactive. For the traditional US media industry, which is beset by falling advertising revenue thanks to the global financial crisis and the defection of audiences to online media, any opportunity to offer a new advertising product to brands is likely to be welcomed.

The QMCODES system relies on advertisers placing so-called quick response codes (QR codes — a type of black and white barcode made up of small squares) on print pages, outdoor advertisements or on product packaging.

QR codes can be scanned using the camera on a smartphone, and act like a URL that directs the phone's web browser to a specific page, or invites the consumer to download content. QMCODES' technology can also launch content from an SMS number should the phone not be equipped with a QR code reader.

McGregor Dey was a participant in a joint AIMIA and Austrade digital industry trade mission to New York City in March this year, and since then has been criss-crossing the US following up numerous leads from companies in the magazine, newspaper, music, film and book publishing industries.

One of those meetings was with the book publisher HarperCollins, with whom QMCODES has now entered a paid trial that will see QR codes printed on books. QMCODES can then link these codes to additional online content. One trial involves author Lauren Conrad and her book LA Candy.

"It's taking that print platform and making it interactive using our tags and analytics," McGregor Dey says. "One of HarperCollins strategies is to create a brand around the author — not just the book itself. So they are trying to show fans that authors have additional content such as podcasts and vodcasts."

QMCODES has also conducted a trial campaign with the music company Geffen Interscope A&R for a concert by the band Yeah Yeah Yeahs, where fans could use a QR code to download an exclusive remix of one of its songs. That trial has now been extended to the band's entire tour, and Geffen will run a similar campaign for TV On The Radio's tour.

For the record company, it is another chance to interact with the band's audience and establish a line of communication for further promotions. Warner Music has subsequently shown interest in a similar trial for several of its artists, and QMCODES has also received strong interest from other US publishers and entertainment companies.

McGregor Dey is now in the market for US$1.5 million in funding to continue chasing opportunities in Australia, the US and elsewhere, to top up the $100,000 it received from Australian investors earlier this year and $150,000 from Film Victoria in 2008.

Commentary
QMCODES is far from alone in the QR codes market in the US, but has several advantages, including successful campaigns in Australia with some smaller magazine publishers and the filmed entertainment company Village Roadshow. It also has advanced analytics capability that can track consumer behaviour by factors such as their location or the device they are using to access content. McGregor Dey says no other platform can deliver the breadth of content that his can, including audio and video.

The key element for success will be McGregor Dey and his team's ability to move quickly to capitalise on the opportunities that are available to them. They are also relying on the propagation of internet-capable smartphones — which is now past 50 per cent in Australia, but sits at just 30 per cent in the US. Without these, the content attached to a QR code cannot be delivered.

The traditional American media industry is in deep trouble, and knows it. The recording industry has already been decimated by illegal downloads, and is now forced to sell music at lower margins on other people's terms, such as through iTunes or as an add-on subscription service for mobile phone purchasers.

Newspapers across the US are struggling, with many either closing entirely or moving to online models, and many well-known magazines are faring no better. Devices such as Amazon's Kindle are threatening to reshape book publishing.

Anything that can bring them a new revenue stream is going to have appeal. For McGregor Dey, their challenge has delivered a golden opportunity.

bootstrappr opinion: BOOM

Comments (7) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

One of 3RD sense's games
(Credit: 3RD sense)

Casual games cost a fraction to develop when compared to the big console titles, and are easily distributed from websites, mobile portals, through Facebook and MySpace, or through the online networks of Xbox and PlayStation.

They are also big business. The Casual Games Association estimated that the industry had revenues in excess of US$2.25 billion in 2007 (more recent figures are not available) and said that figure was growing at 20 per cent annually.

For three years now Sydney-based 3RD sense has been claiming a small but growing share of that market with a series of casual games it distributes through its own internet portal, www.fizzy.com.

The company began life developing games specifically for brands and other advertisers, but soon realised there was money to be made in getting its games concepts out to a broader audience. Its most popular game, Swords & Sandals III, has now been played more than 3 million times.

While the company continues to create custom work for brands, its founder and chief executive Colin Cardwell says Fizzy is getting more than 1 million monthly visitors (the vast majority from outside Australia) who are playing more than 3 million gaming sessions. The portal, which contains around 500 games, has more than 340,000 members, and they are buying several thousand downloads each month.

Most importantly, he says 3RD sense is able to serve ads directly to those gamers — at a rate of 35 million each month.

Cardwell says the company would love to be distributing games through mobile services and Xbox live, but has been too busy with the opportunities that are already in front of it.

To this end 3RD sense is about to embark on a capital raising. The company is seeking $5 million to hire the staff and management expertise that Cardwell knows he needs to convert some of that potential. The company already has $400,000 from Divergent Capital, but Cardwell says he is keen to expand Fizzy and take on some of the other potential markets for casual games.

Commentary
There is some precedent to say the company might get it. Casual games companies have been popular with venture investors, particularly in the US. On 6 May Silicon Valley-based casual games company WonderHill announced that it had raised US$7 million.

If 3RD sense fails to find that same success, it won't be due to shyness. The company recently picked up media attention from as far away as the London newspapers for its game based on the swine flu epidemic.

As long as casual gamers continue to look for cheap and convenient distractions from the perils of pandemics, terrorism and the global financial crisis, 3RD sense could just be on to something.

bootstrappr opinion: BOOM

Comments (1) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Bad boy Kogan called to ACCC's office
• Google Australia offers free AdWords
• PlayStation 3 site hacked, 2.40 upgrade suspended
• Can your PC crack the secrets of the universe?

There are great technical roots in Australia for this area, but poor market engagement and visibility

Southern Cross joint MD Larry Marshall

Silicon Valley-based wireless technology start-up Quantenna Communications is planning to open a 30 to 50-person research facility in Australia following an injection of venture capital by the Australian-US fund Southern Cross Venture Partners.

Southern Cross was the lead investor in a US$13.85 million series C investment round that included many of Quantenna's existing investors, including blue chip Silicon Valley VC Sequoia Capital.

Quantenna is developing technology to improve the reliability of wireless networking based on the Wireless N protocol, specifically in relation to streaming high-definition video within homes and apartment buildings.

Chairman Behrooz Rezvani says the technology, which optimises the "beam" that is used to transmit information wirelessly, is capable of improving the reliability of connections by 10 to 12 times. The company is currently providing samples of its technology to wireless equipment manufacturers, and Rezvani expects to announce its first commercial deals as early as the third quarter of this year.

Rezvani says his meetings with Southern Cross opened his eyes to the quality of Australian wireless technology innovation. He says this capability was reinforced again recently when large US companies including Fujitsu, Hewlett-Packard and Asus chose to settle legal action out of court with the CSIRO for alleged patent infringements relating to 802.11 wireless technology. The terms of that settlement are unknown, but are believed to be highly favourable to the CSIRO.

In addition to the local talent available, Rezvani says that Australia poses none of the commercial or cultural challenges of other possible offshore locations, and is closer to Silicon Valley by plane than Bangalore.

His goal is to open a facility in Australia this year to investigate additional uses for Quantenna's technology. Rezvani says he is also seeking to create partnerships with Australian research institutions including NICTA and CSIRO, which are both operating extensive programs in wireless chip technology.

Southern Cross joint managing director Dr Larry Marshall, an expat Australian living in Silicon Valley, has joined the Quantenna board as a result of the transaction. Marshall has been a strong advocate for the proposed Australian facility.

"There are great technical roots in Australia for this area, but poor market engagement and visibility," Marshall says. "If we can attract people like Behrooz, companies like Quantenna, and VCs like Sequoia, Venrock and Sigma to start thinking of Australia like Israel, it will boost tech investment in Australia."

Comments (3) | Email this

Share: Google | Facebook | del.icio.us | Digg | Reddit | Slashdot | StumbleUpon

• Microsoft, Fujitsu, Asus settle with CSIRO
• HP settles with CSIRO
• CSIRO victorious in Wi-Fi appeal
• Manjrasoft's forecast: Cloudy but fine