Angel News Australia

Volume 3, Issue 8, September, 2010

2011 Annual Conference Early-Bird Open

October 1st: Early-bird registration opens today for the 2001 AAAI Angel Conference. Pursuing the theme of "Angels without Borders" this conference will feature experienced Angel investors from around Australia and from overseas.

Building on the success of past years, AAAI Chairman John Mactaggart said, "We expect this to be our biggest and best conference so far. Featuring leading Angels experienced in cross-border investments and exits, our speakers come from Scotland, Chile, India, China, New Zealand, Canada, USA, Singapore and around Australia."

New features such as an Angelsoft User Group meeting and Entrepreneur Case Study join regular features including a choice of three different Angel Master Class workshops (Introductory to Advanced), Government Policy Forum and Active Deals Round-up.

Three days of stimulating discussion and networking with Angels set in the heritage environment of the second oldest city in Australia is just the beginning. As always, there will be a post conference weekend when participants will have the chance to develop closer ties with Australian Angels and our international guests in a more relaxed atmosphere. Since the Hunter Valley is one of the premier wine regions in Australia, you can expect some enticing opportunities to indulge your palate along with other activities. More details will be available soon.

The AAAI is pleased to be supported by Platinum Sponsors NSW Industry & Investment and Regional Development Australia - Hunter.

Register now, or find more information.

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New Member Travel Benefits
The AAAI is very pleased to announce that our members now have access to the Travel Club by Flight Centre. This corporate travel service provides members with direct phone and email access to a personal travel agent who can make all travel arrangements for domestic and international business and personal travel. FC_Travel_Club

When AAAI members sign up for this service they will receive benefits including:

  • $50 off first booking over $1,000; and
  • Secure access to the Travel Club website with monthly Travel discounts & offers listed; and
  • Your choice of accessing the service over the phone or direct from the website; and
  • Travel arrangements with the Lowest Price Promise & same day response guarantee.

All Travel Club Travel Managers have 10+ years' experience in the travel industry.

All travel and accommodation arrangements for the 2011 AAAI National Angels Conference are being handled by the Travel Club for members and for non-members.

AAAI members, receive your personal login details when you register for this exclusive member benefit.

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Why now is the time for Angels ...

A recent survey of the Ernst & Young Entrepreneur Of The Year alumni has found that 74% of respondents defied the market and grew their businesses in 2009, with 60% expecting to achieve double digit growth in calendar 2010.

The Ernst & Young survey found that the respondents - some of Australia's most successful entrepreneurs - are increasingly confident about their business growth prospects, with 72% confident about the Australian economy in 2010 and 67% believing the availability of capital will improve in 2011. Seventy one percent expect to employ more people in the next 12 months, 62% plan to raise funds in the next 12 months and 68% plan to expand operations overseas. In addition, the entrepreneurs surveyed overwhelmingly agreed that passion, determination and vision are the key ingredients for success, with 80% believing that this has not changed in the past 10 years and will not change in the future.

The survey respondents had started on average four businesses each, creating their first business at the average age of 25 and were motivated primarily by the desire to create a business, with wealth creation as a secondary driver. These are a few of the many findings contained in the 2010 Entrepreneurs' Confidence Barometer, a survey conducted to mark the 10th anniversary of the Entrepreneur Of The Year program in Australia.

Ernst & Young partner Greg Logue says the responses illustrate that successful entrepreneurs are more than simply higher achievers.

"They are the ones who seek out opportunities and turn their vision into reality, creating a flow-on success for those around them through employment, export growth and social contributions," says Logue.

"The confidence and focus of these entrepreneurs is both inspiring and heartening - these are the people who continue to drive the economy forward and create the future."

The survey findings also suggest that there is a greater appreciation of the contribution entrepreneurs make to our economy and communities. Fifty six percent of respondents believe the Australian culture supports entrepreneurship - a significant shift in attitude compared to a similar 2004 survey that found that only 38% of respondents held the same view. 

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An Australian Y-Combinator?

StartMate is a group of start-up executives offering mentor-ship and seed financing to founders of Internet and Software businesses based in Australia. Their first program is in the first quarter of 2011 in Sydney and applications will open later this year.

The mentor team of more than 20 successful founders have pooled their money into a seed fund and want to help the most exceptional, technically-focused entrepreneurs create world class companies that solve customer problems.

The three month program offers a $25,000 investment, mentor-ship, sage legal counsel and a two week trip to Silicon Valley. At the conclusion of the program there are two demo days, one in Sydney and one in Silicon Valley, when entrepreneurs will present in front of early-stage investors.

A strong belief in lean start-up principles, the team emphasise that the biggest risk in a start-up is not whether someone will steal the idea, or whether the founder can build the product but, rather that no one will care. StartMate is designed to help win first customers and work through the initial stages of customer discovery.

The first wave of 5 start-ups in StartMate will commence in January of 2011 in Sydney, with applications open in October, 2010. Applications will close in mid-November, followed by final round interviews in the style of StartupCamp but, with a particular focus on lean start-up principles.

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Angels are all about Entrepreneurs

Angel groups must never succumb to the hubris trap many VC and HNWI fall into, disrespecting the entrepreneur and, as a result, suffering a bad reputation in the entrepreneur community.

Most Angel groups work hard to deliver value to every entrepreneur who engages in the group's process. At a minimum, groups typically provide considered feedback at each stage of their process from initial review through screening and pitching on to evaluation, negotiation and due diligence. This constructive feedback from experienced business people, successful entrepreneurs and battle-proven investors is many thousands of dollars of consulting value that the typical entrepreneur will never access anywhere else - paid or unpaid.

Sydney Angels think of it as giving all applicants some kind of prize, such as complimentary video recordings of their presentations and Q&A handling at screening meetings and members meetings. Melbourne Angels offers free pitch coaching to every entrepreneur invited to present to the group. BioAngels require every deal to be introduced by a member, as a deal champion and that ensures that deals are ushered through the group process by someone who has his/her own reputation at stake.

However the group seeks to reward entrepreneurs, these efforts all cost time and, sometimes, money. This highlights the need for Angel groups to find sustainable and scalable models, effective referral sources and supportive sponsors and development partners. To make these all work, the group needs a management team who are highly motivated, committed and have the time available to get things done.

Indeed, it is the entrepreneurial experience and passion of the Angels that brings them to the group and it is those same skills and resources that not only underpin the success of administering the group but, most importantly, the success of the investments.

Angels need the support of the entrepreneurial ecosystem, from the eager entrepreneurs willing to participate in the Angel process (not an overnight decision, a genuine process that typically takes weeks to months) to the channelling of quality deal flow from corporate advisers, investment bankers, venture capital firms, accountants, lawyers and design firms. Financial support in direct cash sponsorship from companies, governments (local and state) and universities is truly helpful. Similarly, in-kind support from lawyers, accountants, IP attorneys, market research firms and others can be critical to more entrepreneurs being funded and being successful.

Why is supporting Angel groups, supporting entrepreneurs?

The inherent goal and priority of Angels is to invest in entrepreneurial companies. Successful investments lead to new jobs, new markets, new skills and higher tax revenues for the nation. This is a virtuous cycle of innovation, investment and commercialisation that benefits the entire community. While there is no reliable data for Australia and our circumstances differ, it is instructional to consider the recently released Kauffman Foundation study that showed ALL net job growth in the USA from 1977 to 2005 came from companies that were under five years old. Actually, the study demonstrated that, in the macro environment, established companies are net job destroyers, losing 1 million net jobs per year. In contrast, start-ups in their first year added an average of 3 million jobs annually. Building small firms into large firms is important but, the cycle of contracting old industries and creating new has given the USA its greatest global advantage. Protecting old industries isn't the best way to reduce unemployment; it is a sure road to downsizing.

In Australia, we need to continue to exploit our strengths in primary industries. Resources and agriculture continue to be foundation stones of our economy. Our miners and farmers are amongst the most sophisticated, technology savvy and competitive on the planet. That is great because it creates a stable base from which to grow and develop our new comparative strengths in intellectual property-based enterprises in manufacturing, communications and services. Those new strengths will arise from the Australians who have the will, the guts and the aptitude to take the risks of time, effort and investment that turn start-up ventures into highly successful enterprises.

As has been featured in this newsletter previously, creating tax incentives to drive Angel investment is proving to be a very effective and economical measure for many communities around the world. Another emerging feature is the use of co-investment funds, or side-car funds. Last month Sydney Angels launched the first Angel side-car fund in Australia. teQstart in Queensland was a co-investment fund for early-stage companies which enjoyed success before the disappointing pendulum swing of political will saw it shut down for no better reason than political fashion. The same sort of political impact that cancelled Commercial Ready and replaced it with Commercialisation Australia which, with its matching funding requirements and repayable grants (Ed: Isn't that an oxymoron?), is the closest thing available today to government co-investment for early-stage deals.

Angel investors are driving our future through the success of the entrepreneurs in whom they invest. That deserves the active and passive support of every Australian who cares for our future. One simple action is to join the AAAI, the only national non-profit voice specifically focused on the early-stage enterprise, its creators and its backers. 

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RealTime Speaking Presentation & Pitch Tip #3

A series by Robert Rabbin

Authentic Connection

Speaking effectively is about credibility; credibility is about authenticity, which is about vulnerability - which means one's speaking has to reveal, rather than conceal, one's true thoughts and feelings. It is important for entrepreneurs to know that the true power of their speaking comes not from facts and figures, not data and research, but from authentic connection.

Authentic connection means that you touch your audience by speaking from your heart to theirs, in a simple, direct manner. You look in their eyes and you tell the truth. Authentic connection has a precise formula:

Authentic Connection = Intimacy With Self + Vulnerability With Others

Intimacy with selfimplies a willingness and capacity to know oneself from the inside out, deeply; one must excavate through layers of repression, other peoples' ideas and beliefs, fears and inhibitions - all the way to a dynamic place of genuine enthusiasm for one's life, for one's deeply felt vision and values. You've got to know who you are in the core of your very being, because this is what people are looking for. They want to see the thing in you that they can trust, as if you were going to belay them on a long steep climb up a perilous cliff. As a belayer, their life is in your hands. Can they trust you? Can they believe you? If people do not fundamentally, even intuitively, trust and believe in you, they will not listen further. They will not care what you have to say.

Vulnerability with others implies a willingness and capacity to stand in front of others fully seeing them, and allowing them to see you, without pretense or defense, without putting up masks or barriers behind which to hide or distort our genuine presence. Vulnerability is risky business, at best; we scarcely open ourselves all the way with our spouse or partner, how in the world can we do this in front of people we don't even know? Entrepreneurs take this risk.

It is this quality of establishing a connection with oneself and one's audience that creates the channels through which communication - as distinct from information - is transmitted. It is a matter of embodying one's message, rather than presenting information.

People want to trust you, not what you know or your ideas or plans. First things first. If they don't trust you, they won't trust anything that comes after. Who are you? Where is your character, your spine? Where is that solid thing about you that will cause people to put their life in your hands, to invest their money in your ideas?

Remember: YOU are the message!


Robert Rabbin's motto is Have Mouth, Will Travel. During the past 25 years, Robert has created an international reputation as a skilled and inspirational keynote speaker, leadership adviser, and self-awareness teacher. Robert is also a respected public speaking guru and communication strategist who is the creator and managing director of RealTime Speaking, a dynamic style of public speaking and communicating based on integrity, vulnerability, and authentic connection.

For further information about Robert and his work, please visit his website.



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