Support network a boost for business

WITH private backing and Federal Government grants worth millions of dollars, a growing venture support network is providing Western Australians with marketable ideas early stage business skills and seed capital, and links to further advancement opportunities.

This network appears to be developing around personalities with personal experience or observations of the struggle to build a company from a new technology idea. Other venture backers have links to the industry and education sectors, which match ongoing needs with research into new ideas, or have held management positions in sectors continually demanding the latest in communications technology.

One player in the network is QPSX co-founder Rob Newman.

Although the company has now gone on to develop data communications products for Telstra and markets in the US and Europe, Dr Newman experienced a dearth of early stage marketing and sales techniques in WA getting the company off the ground in 1987.

Through his personal experience marketing dot.com products for Synoptics in California, he then acquired such skills in Silicon Valley.

Now back in Perth as chief executive of Venture Skills, Dr Newman offering a marketing base to would-be entrepreneurs with good technology ideas.

Dr Newman, who spoke at the recent Australia-Israel Chamber of Commerce-University of WA Innovation Series event Techstarts, believes almost-profitable entrepreneurs with good creativity are sufficiently serviced in WA, with late-stage capital backing available to help companies expand.

But many would-be company founders and graduates with good ideas are less well off.

“They typically leave with their ideas, get their experience and don’t come back,” Dr Newman says.

Venture Skills invests time in people to develop their technology ideas into a business plan from which to build a company. For this investment, Venture Skills takes equity in the company and then assists the fledgling company to find its initial customers and develop marketing skills, before introducing it to a second-stage support company such as Entrepreneurs in Residence.

Dr Newman, a director of EiR, describes this venture support company as “an information technology and communications incubator providing seed capital, management expertise, accommodation and mentoring to IT&C start-up companies”.

Start-up companies under the wing of EiR, and its chairman Kevin Campbell, also benefit from links with EiR’s shareholders, including international multi-support group Zernike, Imago MultiMedia Centre and Software Engineering Australia.

From his time in California, Dr Newman says he has learned that the most critical resource in early stage ventures is people.

“The emphasis there was on fostering individuals rather than ventures,” he said.

Nonetheless, another lesson learned is that “the challenge in high tech marketing is to back a product with mainstream potential, rather than one that is merely ‘cool’”.

Another project backer, Zernike Australia chief executive Peter Why, first saw the need for early-stage support as manager of Technology Park in Bentley.

“When managing a place like this, you want to be able to offer other services, to help people export and to get their idea to the market,” Mr Why said.

The Zernike link in the venture support network helps start-up companies with global application products to expand quickly into Europe and North America.

“We take the isolation of Perth and use our global networks.”.

In two years, Zernike Australia, a division of the Amsterdam-based Zernike group, has vetted more than 100 projects, looking for early-stage projects with broad application products, a potential market larger than Australia, personnel with “the right personality and nous” and unique technology suited to international patenting.

“What we’re trying to do in WA is to develop, now, a culture of seed capital which can be invested in start-ups,” Mr Why said.

But he also sees a need to extend the international Zernike group’s education support to WA.

In WA, Zernike wants to develop a node of its Amsterdam international university for entrepreneurship in all universities willing to participate.

“People want a lifelong learning centre. We’re not catering for people who are still young but, for example, in their 40s and established,” Mr Why said.

“These people have ideas and they say, ‘I’m fairly comfortable, so now, shall I take a risk?’ We need to help these people.”