By Mick Liubinskas
After 18 years of loving my life growing technology companies in Sydney, I’ve decided to make the move to the USA. It’s a big step and I do it with excitement, fear, disappointment and hope.
TL;DR: My family and I are planning to move in August, I’m staying with muru-D, still helping the Australian ecosystem, and hoping we can all take things to the next level.
In August this year, after muru-D Syd3 demo day, my family and I will relocate to San Francisco. Our plan is to stay for at least a few years but then come back to Sydney. It’s not going to be easy moving with three kids (and a cat) but my wife and I are up for the adventure and ready for some change.
I’m going to miss my family and friends, but I’m also really going to miss the tech ecosystem - my other family. It feels like it’s bad news that one of us is going away, but trust me, it’s a good thing.
The good news is that along with muru-D, I’ll be staying on as a mentor of Startmate, a director of Pollenizer and supporter of Australian tech companies.
My main role will remain as an entrepreneur-in-residence for muru-D, but with a twist. muru-D was established just two and a half years ago and has 44 companies in the portfolio. By this time next year that number could be as high as 80. We’ve got a great program working in Sydney, Singapore and through our partnership with River City Labs in Brisbane and it’s producing high potential companies. The reality is that after the companies graduate from muru-D, many of them could still do with some help to keep growing. With the alumni growing fast, the workload to help them is getting beyond the team, whose prime goal is to run great programs.
So my new role will have two functions. Firstly to support the alumni directly, with growth, team, partnerships, capital raising and potentially exits. And secondly, to create stronger networks outside of Australia and South East Asia so that muru-D companies can take better advantage of big markets - specifically the USA, China and Europe.
There will be a new entrepreneur-in-residence to run the Sydney cohorts and also to support muru-D Local. (Ping me if you’ve run a few startups, got some global experience and love coaching entrepreneurs).
One of the reasons this is a good thing for Australian tech community is that part of muru-D's mandate is to grow the ecosystem. So whilst a lot of my energy will go to muru-D companies, I’ll also be supporting all Australian, fast growth tech companies with global ambitions.
Why do I have to be in Silicon Valley to do that? A few reasons.
To meet people. Networks are about relationships with people and they are built face to face. It’s about understanding each other, showing commitment, following through and also about continuity. With all the technology in the world, consistently being there is one of the foundations of strong networks. I can’t do what I need to do from Australia with the occasional visit.
To be with the best. Silicon Valley is still the world’s leading market for fast growth tech for companies. China is huge, Europe is growing stronger and other markets are emerging and other markets but the best people, partners and investors sits between San Francisco and San Jose. It will mean some travel to those other markets, but the Bay Area is the best base.
To prove myself. I’m proud of what I’ve done, but I’m not done. I also think I’ve underachieved. I’ve learned so much and in hindsight, I’m dissatisfied. I’ve also got a great bunch of friends who keep nailing it at higher and higher levels and I’m ready to challenge myself further. Being at Galactic Central Point brings opportunities, but it will also be very hard. Bring it on.
To improve myself. I need to get better. For me, for muru-D and for the Australian ecosystem. I want to be challenged in all areas and be a tiny fish in a massive pond. I’m someone who thrives on change and this is the change I need to grow.
Because it’s time. After 18 years, more than 30 trips and helping about ten companies move to the valley, I want to be immersed in it. Sydney is good, and growing, but San Francisco is Legoland, the NBA and North Shore Hawaii for tech. I want my Uber driver to have a startup. I want all the billboards to be startups. I want to have 18 different events per night (even though I won’t go to them).
I hope everyone who’s supported me understands my logic here. I do love Australia and think it will always be home. I’ll be back.
Australia Tech Industry
It’s also time for Australia’s ecosystem to go to the next level. A lot of good people have done a lot of great work but we have also underachieved and we have gone backwards internationally. IMHHO (in my honest and humble opinion) here is what I’d like us to do. Note that this is not perfect or a panacea but I’m confident they would have a big impact.
More Born Global
We are quite good at creating domestic, $10-100m tech businesses but not enough of us are going global day one. Australia is big country physically but it’s too small a market to build a base of revenue or customers by which to take on the world. BigCommerce, Campaign Monitor and Atlassian were born global.
This doesn’t preclude domestic first opportunities. Some startups really need to be local to be validated and sometimes regulation or other factors means global is too hard. But I have seen a lot of companies say that they’ll prove it out in Australia and then go global but often never do or are too late to be a global leader.
Also validation in Australia is not validation globally - both of your product market fit and also your team’s ability to sell globally. So you may not attract world class capital even though your numbers are the same as another startup in the US, China or Europe just because your proof is in a small market. Customers in big markets are worth 10x.
All I’m asking for is 10% more startups to find a customer in a big market first, not later. This will attract global mentors and investors who I believe are waiting in the wings for some more ambition. Many of these are living and operating in those big markets so can help you. I firmly believe that getting these experienced entrepreneurs with global experience to invest their time, wisdom and capital is the biggest leverage we have to growing our industry.
It may also mean that you don’t need to raise capital because your revenue from the big market may actually fund your growth. Again, this is what many of our super stars have done. In some ways Australian’s are early adopters, but for many sectors, especially B2B, they are often branch offices and very slow at trying innovative tools. There is also just more of all types of customers everywhere so if you laser focus on a niche then it can still be big enough to drive solid revenue.
Programs like Starmate, Catalyst, MAP and muru-D put entrepreneurs onto planes and drop them into big markets which is a great way to get exposure. I do think our reputation has been hurt by ‘pay to pitch’ programs which have put Australian tech companies in front of investors too early. The first visits should be about listening, learning, building some connections and getting inspiration. Your mentors and advisors can help you get ready and do the warm introductions.
We are not organised. This is perhaps my greatest frustration. Yes, we are meant to hustle, stay lean and be global but we’ve looked more like a part-time, committee driven rabble than a sleek machine and we’ve paid the price.
Eight years ago there was no Startmate, Squarepeg, Fishburners, Silicon Beach, Angelcube, River City Labs or most of what we have today. There was some good growing companies, Dinner 2.0, WebJam, ATPi and a few gatherings but it was really fragmented and lacked energy. We knew that a rising tide lifts all boats so like many people, Phil and I at Pollenizer invested time and money into community events. We did it with the 1% of time we had spare, as did so many people in the industry and it got us into second gear but I don’t think we’re into third yet.
We’ve attempted a few initiatives but these have not followed the Brad Feld rules of startup communities: entrepreneur led, 20 year commitment, welcome everyone, engage the whole stack. We’ve also again been punished by geography with national programs not having the power of proximity to hold them together plus three levels of government to work with.
Now we have Alex in as CEO of StartupAus it looks to be able to lead government lobbying at a federal level. As someone who was there at inception, I hope they bring in some fresh blood on the board to ensure this becomes a balanced industry representative.
We have a Prime Minister who can talk with knowledge and interest about technology and innovation. I hope we have the courage, and enough volunteers, to put experienced entrepreneurs at the head of these programs or else I don’t believe they will work.
Apart from government impact, the efforts need to be city based and that is starting to occur. Melbourne, Perth and Brisbane seem to have solid, entrepreneurial led groups driving it forward which is great and Sydney will hopefully follow suit soon with TechSydney.
Honestly, most of these are currently too small to have a big global impact. If we all magically moved to one city then we’d probably be top 10 instantly, but it is what it is. I sincerely hope that we stop the useless whining and competition between our cities. Our competition is global. I’m actually supportive of all cities as muru-D Local and my many efforts around Australia will attest. I’m just not supportive of national programs as I haven’t seen them work.
City focus makes sense because you need to work on the full stack and it needs high frequency connection of nodes. People, universities, ideas, startups, growth, team, mentors, investors, space and service providers. Technology connects the world but I still see a significantly better results across the stack when you can meet face to face regularly. It’s also how it’s happened everywhere else so why reinvent the sliced bread.
We are also developing vertical focus too with education tech, fin tech, bio tech, robotics, AI and others. If we can combine this industry focus with strong city based programs and connect them nationally then we’re
Less Hype, More Substance
There is a lot of noise and excitement around tech and startups and this can be used to our advantage. It also brings in people trying to jump on the bandwagon and we don’t have the strength and maturity as an industry to be able to automatically weed them out.
This may sound like it goes against the principle of ‘welcome everyone’ principle, but the next point Brad Feld makes is that they need to be authentic and share the same principles. They should be entrepreneur led. They shouldn’t try to sell their experience when they don’t have any, but they can be about getting experience. They should give before they get. They shouldn’t be zero sum game. And they should be founder friendly.
There are definitely people and organisations that don’t fit the same ethos and for new entrepreneurs it’s hard to know the difference. Another advantage of being better organised is that people coming into the space will have the right support and opportunity to participate and bad operators won’t be able to survive long.
For entrepreneurs, the easiest way to do this is to ask yourself (and the people you might want to work with) "have they already done what I need to do?" If they have, and follow Brad Feld’s principles, great. If they haven’t, keep looking - they are out there and worth the effort.
I say this knowing that I haven’t done one hundredth of what the companies I’m looking to help need. This is why my main role is to help them find industry, market and technically experienced people to dive in and participate.
Funding Will Come
Venture funding is a lagging indicator of a successful ecosystem. It’s inherently low risk and will be invested when the companies are ready for it, not in advance of it. We’ve gone a long way to create some success stories but we’ve got a lot further to go to make it work as a proven path. Israel was nailing it for 10 years before the rest of the world took notice.
Again our market size makes this harder and creates a Catch 22. If you’re domestically focused it can be hard for a VC to get a return from you or invest enough in you at your domestic valuation. If you’re globally focused then you can probably get a VC from a big market which helps you grow further, where an Australia VC can’t help as much.
Create a great product that gets global customers and you either won’t need the funding or it will come to you.
Where To From Here
As I wrote three years ago, we are still just scratching the surface of the iceberg. But we are starting to carve out a story and the emergent opportunity is genuinely huge.
I’m very excited.
We can do it.
We can have at least one top 10 tech startup city by 2025.
All we need to do is follow the fundamental principles of launching startups:
Be ambitious - believe in ourselves and take on the world.
Be focused - build strong city ecosystems with great depth.
Take action - work hard, participate, contribute, invest.
I look forward to my new role in Silicon Valley and can’t wait to see how far we can go over the next few years.