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CRIG and investment in the Cairns startup community

In February of this year, Pollenizer’s “forty million dollar man” Phil Morle presented a keynote speech at a Cairns forum aimed at promoting regional investment.

Rather than encouraging attendees to open their chequebooks then and there, the event was designed to be an educational session for local investors. It covered the basics of startup investment with an eye towards future, long-term involvement with the ecosystem, which will become increasingly important as Cairns’ small, isolated startup community grows.

The launch of the Cairns Regional Investment Group at the event, together with Morle’s involvement as the region’s first visiting startup entrepreneur, helped start an ongoing conversation about Cairns’ future within the wider Australian ecosystem. 

Cairns Regional Investment Group

Hosted by theSPACE Cairns and MacDonnells Law, the forum officially introduced the Cairns Regional Investment Group, an initiative aimed at establishing a network of retail and sophisticated investors, as well as supporting regional entrepreneurs in developing their ideas through to commercialisation.

Bringing together high-level board members including Cairns Chamber of Commerce CEO Debbie Hancock, the service offers advice and assistance in gaining access to grant funding, introductions to sophisticated investors, and capital raising via the Australian Small Scale Offerings Board (ASSOB) platform.

It has only been three months since CRIG launched, so we can’t pinpoint any success stories just yet.  But the hope is that CRIG will form something of a runway so that when Cairns does start getting startups that stick, they won’t stall at the next obstacle: finding investment.

Travelling Entrepreneur Phil Morle

Waking at 3:00am to complete a 24-hour Sydney-Cairns turnaround, Phil Morle was the first startup heavyweight to lend his time and support to CRIG.

At the forum, Morle explained the benefits of startup investment to the investor, the startup sector, and the local economy.  He also shared his wealth of experience as an entrepreneur, as well as some of the work Pollenizer is doing in the world of startups. 

“It’s really inspiring to have such a prominent figure in Australia’s startup community take time out of his schedule to help build this ecosystem,” theSPACE’s Troy Haines said. “There is such an incredible abundance mentality within the startup scene, which seems to be best demonstrated by those who are most successful.”

Morle is co-founder and CEO of Pollenizer, an Australian “startup science” company that employs lean startup methodologies to build incubation and acceleration programs for high growth tech businesses worldwide.  One of Pollenizer’s most notable success stories is group buying website Spreets, which in 2010 was bought by Yahoo 7 for $40 million.    

Morle explained to investors how the startup lifecycle differs from what many would be used to.  Specifically, startups need more ongoing early support and can be riskier, but in return they can experience exponential growth far exceeding that of traditional small business.

He also suggested that to offset the greater risk due to a higher failure rate,  startups could be grouped together rather than treated as individual investments.  CRIG hopes to offer this risk mitigation strategy to local investors by pooling a number of regional startups.

“You can’t put a price on the level of credibility that a man like Phil Morle brings to a room of potential investors,” Haines said. It’s really the first time that anyone has come to this region and placed startups on the map as a legitimate investment option for local investors.”

Phil really helped people understand the value of supporting our emerging entrepreneurs.”

Upcoming Travelling Entrepreneurs

Morle may have been the first major travelling entrepreneur to Cairns, but he’s unlikely to be the last, with Steve Baxter from Network Ten’s Shark Tank slated to attend another Cairns investment forum over the coming months.

The investments Baxter has made in early-stage startups in the last three years have yielded companies with a combined value exceeding $100 million, so it’s not difficult to understand why the CRIG have worked to lure him to the Far North.

“I first came across Steve Baxter through my contact with River City Labs in Brisbane, and of course now he’s appearing on Shark Tank,” Haines said. “It’s very exciting for Cairns to have someone of his stature take the time to visit our region.

“He has precisely the kind of experience and knowledge we’d love to tap into.”

Himself a Queenslander, Baxter opened the Tablelands’ first Startup Weekend earlier this month via Skype.  According to CRIG co-founder Damian Zammit, dates for the upcoming Cairns event, which Baxter will attend in person, will be released as soon as scheduling discussions are finalised.

In another coup for the region, the upcoming Cairns Startup Weekend has secured keynote speaker Dr Clarence Tan from Singularity University, a think tank based in NASA Research Park in Silicon Valley.

Tan is SU’s Australia/Asia Pacific Ambassador, as well as being a founder, angel investor, mentor, professor… his list of experience and accomplishments is difficult to summarise.  His insights are sure to be invaluable, and it’s hoped his visit will bring further credibility to an ecosystem still struggling to gain visibility with investors.

Future

While Cairns has produced startups like Konveen and Inspection Apps, it still struggles with its image as an Australian “lifestyle choice” rather than  a genuine investment opportunity.  But good startup communities transcend nations, and a Chamber of Commerce delegation will head to Guangzhou, China in early June to seek international investment.

The local startup scene is still developing and may be a long way from posting its own Spreets-style success story, but with upcoming events like Startup Weekend – Tourism and Hospitality, the organisers’ hope is that there may be some new ventures looking for funding in Cairns’ not-too-distant future.

CRIG’s Damian Zammit will join the China delegation, and sums up the long-term vision for Cairns: “Maybe this booming regional centre will be where your next idea will find the inspiration, contacts and money it needs to go global.”

Photo: Hadi Zaher
 

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