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Technology entrepreneurship in Australia is booming and several Australian companies have received millions in investments in the past week.

It comes as big US venture capital firms have pumped hundreds of millions of dollars into Australian technology companies over the past year or so. Several have recently visited Australia eyeing new prospects.

“Tech is booming right now” … Freelancer.com CEO Matt Barrie.

Today crowd-sourced graphic design website DesignCrowd, based in Sydney, announced it had received a $3 million investment from Melbourne venture capital firm Starfish Ventures.

Its founder, Alec Lynch, 27, started the company with $10,000 in capital – which quickly grew to $60,000 after he tapped three credit cards and his family for loans – on his parent’s kitchen table.

Also today, professional domain name trader Winged Media, based in Australia but now with an office in the US, announced a $3 million investment from the Carnegie Innovation Fund.

“Companies can be based in Australia while winning their first customers all around the world” … Startmate co-founder Niki Scevak Photo: Billy D. Aldea-Martinez

Last week, Perth-based smartphone app maker Filter Squad, creator of the Discovr range of iOS apps that make it easier to find new apps, announced it had received $1.1 million in funding from Perth firm Yuuwa Capital.

Moving your base to Silicon Valley is no longer essential for technology startup success. Other Australian technology companies that have received huge funding of late include BigCommerce ($15 million in August), 99designs ($35 million in April), OzForex ($110 million in November last year) and Atlassian ($US60 million in July last year).

Earlier this year Australian mobile social media startup Roamz secured $3.5 million from several investors including Salmat.

David McKinney and a screenshot of the Discovr app, which has taken the world by storm.

“Tech is booming right now and certainly I’m seeing a resurgence in technology entrepreneurship in Australia,” said Sydney-based Freelancer.com CEO Matt Barrie, adding there had never been a better time to turn the spark of an idea into an exciting new company.

He said entrepreneurs in Australia were finding new ways to shake up stagnating industries and nothing was off limits. It was now possible to start a company off a credit card and showcase your products to the world.

“Big US investors are starting to look outside their own borders more than ever before, and they’re regularly visiting Australia,” said Barrie, who was BRW’s Entrepreneur of the Year for 2011 and has been selected as a featured speaker at the big SXSW 2012 event in Texas.

“Because valuations in the US are quite high right now, US investors are looking abroad, and that’s great for Australia because we’re high on the list.”

Accel is one big US venture capital firm that has made significant investments in Australia. It was the source of the investments in Atlassian, OzForex and 99designs.

Another big US VC firm, Sequoia, had “actively been visiting” Australia, Barrie said.

“Certainly this year I received about 60 or so cold calls from the late stage [investor] guys who, when I say we’re not raising money right now, rattle off a list of their favourite ten Australian tech companies wanting an opinion,” Barrie said.

Barrie runs a Technology Venture Creation class at the University of Sydney and they held their “2011 pitch day” last Friday, with eight teams pitching their startup ideas to a panel of real investors and entrepreneurs.

He said the ideas included Groupon 2.0, online multiplayer game hosting platforms, car pooling platforms, educational games and location-based games.

Barrie said one startup he was advising just got an interview with YCombinator, the “Harvard of startup incubators in the US”, while another got into StartupChile. Two other groups of entrepreneurs had also come to him with term sheets from early stage US investors.

In Australia, those with startup ideas are being encouraged to apply to the local incubator, Startmate, which is accepting applications up until November 30.

Startmate, which helped launch five companies last year, is a mentor-driven seed fund that invests $25,000 in the companies it selects and pays for their legal bills, travel to the US and office space.

“The rise of web and mobile startups with low-priced monthly subscriptions or in-app purchases mean that companies can be based in Australia while winning their first customers all around the world because they don’t need to hire expensive sales people and setup overseas offices,” said Startmate co-founder Niki Scevak.

“The world’s top venture capital firms and investors are increasingly comfortable investing in growth rounds of Australian companies and we are also starting to see that interest move downstream to earlier and earlier stages.

“Dave McClure, of 500 Startups, for instance, invested in three of the five Startmate companies in the last batch.”

Australian entrepreneurs are using the investment dollars to create significant, viable companies that are often acquired by bigger fish.

Australian iOS game developer Firemint sold to Electronic Arts in May for an estimated $20-40 million. Tapulous, founded by an Australian, sold to Disney in July last year, while RetailMeNot was acquired by US company WhaleShark Media for $90 million in December.

Furthermore, the technology kings dominated the recent BRW Young Rich List, while a quarter of the BRW Fast 100 list of fastest growing Australian companies are technology-related.

David McKinney of Discovr said he was proud to be able to run his startup from Australia and would use the $1.1 million investment to expand his team and grow faster.

“We’ve seen an incredible startup culture emerge in the local scene that has been fostered by people like Pollenizer, Atlassiaan, the Startmate progam, and local angel and VC community,” he said.

Lynch, who studied programming and IT at UTS in Sydney and won the university medal, started DesignCrowd in 2008.

Before that he had started another company, which failed, and was working in strategy consulting for Booz and co.

“I took a leave of absence for a year and took $10,000 in capital, moved back home, setup at the family kitchen room table – didn’t have a garage suitable – and launched the business from home,” he said.

He got the idea for a crowd-sourced graphics design service after he saw the London Olympics logo, which was released several years ago after months of development and hundreds of thousands of dollars in fees to a professional design firm. The logo was panned by the public and the media.

“The traditional design process is expensive, slow and very risky,” said Lynch.

In late 2009 DesignCrowd received $300,000 from angel investors and spread that money thin over two years, during which the business grew by around 1300 per cent.

One of the angel investors was Todd Forest, the boss of NineMSN. But Lynch remains the single biggest shareholder, even after the venture capital injection from Starfish.

“The market that we’re operating in is the global graphic design market – it’s a $180 billion market and there’s over 120 million small businesses in the world,” said Lynch.

“To get our service in front of those small businesses and to get a slice of that global market, we need capital.”

Lynch said 60 per cent of his clients were new businesses looking for a logo but now he is trying to target businesses that are in later stages of their life cycle and also offer them related services beyond just graphic design.

According to market research firm IBISWorld, there are 11,000 designers employed at design agencies around Australia. Lynch said that on DesignCrowd there were 40,000 freelance designers and clients typically received over 100 different designs, allowing them to pick the best one.

Lynch said he was now in an aggressive expansion phase and was urgently seeking to hire 10 staff to aid his moves into the US and Britain.

A rare 24.78 carat Fancy Intense Pink diamond that was auctioned last year. Photo: AFP Photo

Although a 10-carat purplish-pink diamond failed to meet its reserve price at an auction last week, experts say the market for the rare gems is still strong.

“Pink diamonds are red hot,” said David Young, president of Wexford Capital Management, a broker of fancy coloured diamonds.

Christie’s had expected the 10.09 carat Fancy Vivid purplish-pink diamond to fetch as much as $US15 million at a recent auction. Four other pink diamonds had sold for more than $US1 million per carat at auction in the past 15 months.

The record for a diamond sold at auction is held by a Vivid Pink five-carat diamond at $US2.1 million per carat in 2009.

Although Christie’s did not explain why the gem missed its reserve, gemologists and dealers say once you reach the realms of $US1 million-plus per carat, buyers becomes particularly scrupulous.

“When you get up to this level of stone – these Rembrandts, these Monets, these one-of-a-kind pieces- they have to be held up to a very high standard if someone’s going to put that much money on the table,” said Stephen Hofer, a New York research gemologist and diamond cutter specialising in coloured diamonds.

Experts agree that prices for coloured diamonds, pinks in particular, are on the rise, noting that a barrier was broken in recent years that thrust pinks previously selling for $US500,000 to $US600,000 a carat into the $US1 million-a-carat realm.

While the 10-plus carat pinks stun with their size, diamonds extracted from the Argyle diamond mine in Western Australia command similar sums with the intensity of their colour.

Global miner Rio Tinto’s Argyle mine is the world’s only consistent supplier of pink diamonds. While smaller, experts said the rare and exquisite Argyle gems are in a class all their own.

At Argyle, pink diamonds making it to the annual tender are literally one in a million. For every one million carats of rough diamonds produced from the mine, only one polished carat is offered for sale in the tender. In terms of global diamond production, pinks make up only 0.03 percent.

Each spring Rio Tinto displays its finest 40-55 diamonds weighing 0.50 carat or more and ranging in colour from light pink to red, and even violet, at private viewings in exclusive hotels in cities like New York, Paris, and Hong Kong.

The location of the private viewings is kept secret until the day they are shown. Once these rare stones have made their way around the world, sealed bids from diamond connoisseurs and collectors are tallied and the winners notified.

Last November London jewellery dealer Laurence Graff paid $US46 million for a 24.78-carat pink diamond at a sale in Geneva, the highest total price for a gem at auction. He renamed it the “Graff Pink.”

“The thing about the Graff diamond is that it’s a piece of art. There is not another one like that anywhere,” said Gary Roskin, gemologist and founder of The Roskin Gem News Report.

MORE …CLICK ON PHOTO ABOVE

Reuters

Tom Mckaskill is Australia’s leading expert on how successful entrepreneurs start, develop and harvest their ventures. He is acknowledged as the world’s leading expert on exit strategies for high growth enterprises and strategic value exits.

Over a twenty year period as an active entrepreneur, Dr. McKaskill’s experience included multiple start-ups in the UK and USA, raising venture capital twice, undertaking two acquisitions and strategic trade sales of three businesses.

Below is a link to a series of 4 E-books and 1 Workbook focused around the topics of developing your business with a Strategic Exit in mind.

To download this series of Ebooks, Click Here

Also check out Tom’s website at www.drexit.net/

Regards,
Steve Torso
Managing Director
Wholesale Investor
s.torso@wholesaleinvestor.com.au

Received & published by Henry Sapiecha

on directors’ Dai-ichi nod

Australia Tower Group shares surged 42 per cent to a record high as investors supported an all-cash takeover offer from the company’s Japanese cornerstone investor Dai-ichi Life Insurance.

Tower said today its directors recommended shareholders accepted Dai-ichi’s $4 per share, or $1.2 billion, offer to buy all shares it does not already own in the specialist life insurer.

The stock touched $3.88 – Tower’s highest-ever share price since splitting from New Zealand-based Tower in December 2006 – before closing up $1.14, or 41.8 per cent, at $3.87.

Over 20 million shares were traded during the day, Tower’s best daily turnover since October 2008.

IG Markets strategist Ben Potter said the hefty 46.5 per centage  premium to the Christmas Eve closing share price of $2.73 would have ruled out a competing offer.

‘‘I’d be expecting no other bidders around that price,’’ Mr Potter said.‘‘I don’t think people wouls have to think too long and hard about selling their shares at $4.’’

Dai-ichi’s offer to buy the remaining 71.04 per cent of Tower, made yesterday, valued all of Tower at $1.76 billion.

Dai-ichi general manager of international business management department, Takayuki Kotani, said the deal allowed Japan’s number two life insurer to increase its geographic diversification in the Asia Pacific region.

Mr Kotani described Tower as a profitable, growing company with good management and he flagged having a greater presence in Australia in the time ahead.

‘‘Beginning with this investment, Dai-ichi will strengthen its commitment to Australian marketplace over a period of time,’’ Mr Kotani said in a statement.

Dai-ichi, which bought its stake in Tower in August 2008 for $376.3 million and also holds insurance interests in Vietnam, Thailand and India, indicated it wished to keep the Australian insurer’s current management and independent directors in place.

Tower chairman Rob Thomas said the independent directors believed that the offer represented a ‘‘compelling premium and a highly attractive outcome’’ for shareholders.

Managing director Jim Minto said having Dai-ichi as a cornerstone shareholder for the past two years had been of great benefit to Tower’s business partners and customers.

‘‘Dai-ichi is a major life company and there is a strong natural fit that will allow continued benefits to flow for Tower’s customers, staff and business partners,’’ Mr Minto said in his statement.

Dai-ichi listed on the Tokyo stock exchange in April this year, after an initial public offering that raised $US11 billion ($10.92 billion).

Tower’s yearly results, released last month, showed the specialist life insurer’s net profit rose 88 per cent to $87.4 million in fiscal 2010 and a return on capital of 10.3 per cent.

The company did not release earnings guidlines, but said at the time it was targeting an 11 per cent return on capital in fiscal 2011 and a 13 per cent return in three years.

The directors’ recommendation of the Dai-ichi bid, which would be via a scheme of arrangement, is subject to the absence of a superior proposal and the outcome of an independent expert’s report.

It also requires court approval, the go-ahead of Tower shareholders, as well as the go ahead from Australian and Japanese authorities.

Sourced & published by Henry Sapiecha

India’s richest man builds

world’s first billion-dollar home

An Indian businessman has built the world’s most expensive home – valued at $1 billion, with three helipads, its own air traffic control, a six-floor car park, a staff of 600, a four-storey hanging garden and a cinema.

The 173-metre tall mansion is called Antilia, after a mythical island in the Atlantic Ocean, and has just been completed after seven years of construction.

Owner Mukesh Ambani, his wife Nita and three children are set to move into the opulent 27-floor building after an housewarming party on October 28, which boosts a guest list of India’s elite that reportedly includes Prime Minister Manmohan Singh and star cricketer Sachin Tendulkar.

Home sweet home … Mukesh Ambani’s new home. Photo: Jay Hariani via WikiCommons

The building soars high above Mumbai, giving its future residents a panoramic view of the country’s financial capital, including its slums, and the Arabian Sea.

It was built to withstand military-grade explosions and an magnitude-8 earthquake, Indian media reported.

“I have seen several houses, including that of Lakshmi Mittal (an Indian steel tycoon and also one of the world’s richest men),” a businessman, who was not named, told The Times of India.

The home’s ballroom.

“But Antilia is marvellous. I remember the house having a Picasso painting, it was one of its kind.”

Mr Ambani, 53, is the world’s fourth richest man and has a personal wealth of about $27 billion, but is set to become the world’s richest in 2014, Forbes magazine estimated.

He is the chairman of Reliance Industries, India’s largest private sector company, which has interests in oil, gas, textiles, retail and telecommunications. He also owns the Indian Premier League Twenty20 cricket team, the Mumbai Indians.

While the home cost about $77 million to build, Mumbai’s growing property prices means Antilia is now estimated to be worth 15 times more – about $1 billion.

An Indian design magazine editor, Shiny Varghese, said Antilia was “so obscenely lavish” that she doubted many other wealthy folk would splash out in such a manner.

“But we are heading into the sort of culture where money is not a question when setting up a home,” Mr Varghese told The Guardian.

Mr Ambani is believed to have previously avoided overt displays of his wealth, although Indian media reported his purchase of a $60 million Airbus corporate jet for his wife as a 44th birthday present in 2007.

“Perhaps he has been stung by his portrayal in the media as an introvert,” Hamish McDonald, who has written a book about the family Mahabharata In Polyester, told the Guardian.

“Maybe he is making the point that he is a tycoon in his own right.”

Mr Ambani and his family are reportedly currently living in the more modest surrounds of a 14-storey apartment building.

The specs

Antilia, dubbed the “mansion in the sky” by the Times, was built in consultation with US architecture firms Perkins and Will & Hirsch Bedner Associates.

Its construction was reportedly influenced by Vaastu, an ancient Indian belief similarly to the Chinese’s Feng Shui.

Each level is twice as high as a normal floor.

No floors or rooms are the same, meaning the material used on one floor cannot be used in the construction of another level.

The first six floors are taken up by a car park that can hold up to 168 cars. The next floor is the lobby, with nine lifts servicing the building.

On the eight floor lies a 50-seat theatre. Another floor consists of a ballroom that has a ceiling mostly covered by crystal chandeliers.

Other floors contain a health spa with a gym and dance studio, swimming pools, lounges, a vehicle maintenance area and, of course, guest rooms.

The Ambani family will reside on the skyscraper’s top four floors, which takes up about 37,000 square metres.

The competition

Mr Ambani’s home is the world’s most expensive, but he is not the only person to have built himself a luxurious abode.

The Villa La Leopolda, on the French Riviera, was built in 1902 by King Leopold II of Belgium. It was last valued to be worth at least $US524 million and is reportedly owned by a Russian billionaire.

Dracula’s Castle, in Romania, was built in the 14th century and is now a tourist museum. It is perched on top of a 61-metre rock, overlooks the village of Bran and has about 60 rooms. It is valued at about $US135 million.

The Hearst mansion, also known as the Beverly House (not the Hearst Castle) in California, was valued at about $US165 million and has 29 bedrooms – but only three swimming pools. It is named after its former owner, newspaper baron William Randolph Hearst.

It is now on the market for $US95 million after its current landlord filed for bankruptcy.

The One Hyde Park penthouse, in London, has only six bedrooms but was sold for a cool £140 million ($226 million) in August. It has bulletproof windows, panic rooms and a numberplate-recognition security system for its car park.

Its owners will be guarded by security guards who were trained by the SAS and served by staff from its neighbour, the Mandarin Oriental hotel.

Sourced & published by Henry Sapiecha

NRAS Property Workshop

The National Rental Affordability Scheme explained

GPS is proud to provide Australian investors with the opportunity to take part in the National Rental Affordability Scheme (NRAS) with properties all over Australia.  This workshop will teach you about NRAS and the excellent tax free rebates/incentives for the next 10 years.

By supplying you access to a website especially designed to provide detailed analysis you will be able to assess the benefits of NRAS on a range of effective investment properties nationally

Some of the topics to be covered in depth are:

What is a NRAS?

Why NRAS was introduced.

Government Tax Free Incentives.

What are the financial benefits to the Investors?

What properties are available in Perth under NRAS and how do they compare?

How does GPS assist in choosing the best NRAS product Australia Wide?

A case Study and a lot more.

Perth Workshop Details:

NRAS workshop:

When: Wednesday 8^th September 2010

Location: GPS Perth Office – Suite 1, 251 Hay Street, East Perth WA

Arrive: 5:45pm for Registration, Networking & Refreshments
6:00pm Start – 7.30pm

We extend the invitation to you and your associates who you believe would also benefit from this education. You may register your interest for this workshop in your State.

Please RSVP at your earliest to confirm your attendance to the workshop by simply completing the online form: www.gpsnetwork.com.au/NRAS-Property.asp

Best Regards,

The GPS Team

Property Investment Information - www.gpsnetwork.com.au

Search Investment Properties – www.guardianproperty.com.au

Published by Henry Sapiecha

CURRENT ANNIE ST PROJECT FOR SALE FLYER

Joint ventures and exchanges considered

Published by Henry Sapiecha