Farvel 2017!

I was at a community event recently chatting to a friend and he commented, “you’ve had quite a busy year”. He was not wrong. But it was the first time it really struck me. Here’s a short recap.

We had a solid year at iwantmyname and have grown the iwantmyname team to fourteen, about half of whom are based outside of New Zealand, supporting the 93% of our customers that come to us from offshore. Mid year we convened everyone for a week in Vancouver to co-design a “social contract” for the company, plan some projects and eat all the salmon burgers and maple syrup pancakes we could lay our hands on. Hard to believe that next year iwantmyname will be ten years young. I’m sure we will be planning something special for the community that has supported us. Watch this space! In the meantime we’ve continued backing tech meetups and Startup Weekends around New Zealand (and abroad).

In 2017 I was part of the team that took Polanyio through the Lightning Lab Electric accelerator. There were tears, there was laughter plus loads of hard work forging a position in a very tough and intransigent sector.  We are currently working with an industry partner to continue development of a unified procurement platform that engages energy brokers, their customers and energy retailers. Amidst all the startup hype around consumer apps, we elected to focus on a non-sexy B2B project that will actually drive some long term efficiencies in the evolving energy market landscape. As a result of this experience, I remain open minded about what incubators and accelerators bring to the economy, but I continue to maintain that the government does have a role in promoting innovation and entrepreneurship.

There was also some big changes in my domestic life this year. The lovely Renea Mackie graciously accepted my marriage proposal and we decided to make the move to set up a semi-rural family home in delightful Wairarapa. After more than three decades stoically enduring Wellington weather, I’m certainly loving the Mediterranean climate as well as reveling in the joy of having world class vineyards only a few minutes down the road. We’ve been fortunate to be able to work from home mostly, but we venture across the Rimutakas once or twice a week for meetings and to keep in touch with family. Best of both worlds.

Renea and I have also been busy establishing Creative Forest together with the aim of continuing and extending the wonderful work that Renea became so well known for in Canterbury. Creative Forest offers an innovation framework for young people to explore entrepreneurship with the support of mentors and technical advisors from the community. The company is part of a growing portfolio of interests for GeniusNet and has begun to attract attention from educators, government and iwi representatives.

There were some disappointments in 2017 as well and it also felt like we reached peak political correctness in terms of the vocal minority who find it increasingly necessary to impugn others who hold different views than themselves. In my opinion this is largely in response to the ugliness and idiocy of the current American administration which has unfortunately permeated our collective consciousness during the last twelve months. The consequent steady erosion of the legitimacy of Western democratic social values is very concerning. Notwithstanding this, I’m choosing to focus on the positive aspects of 2017. As my Norwegian ancestors would say – Farvel 2017! Happy 2018 everyone.

Paul Spence is a commentator and serial entrepreneur, a co-founder of Wellington, New Zealand based technology ventures iwantmyname and Polanyio and a founding mentor with Startup Weekends and Lightning Lab. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Innovation Ecosystem Worries Unfounded

It was very disappointing to read Mike O’Donnell’s recent comments about the supposedly tragic state of New Zealand’s innovation ecosystem. Now whilst I respect what those guys have built, it seems like not a year goes by without a member of the TradeMe cabal bagging our community and what we have achieved. It’s starting to get a bit old.

Let’s deal with the obvious hypocrisy first. O’Donnell draws on a marine ecosystem analogy that he picked up at a recent conference. He describes startup companies as bottom feeding low life species, feeding off the stronger, larger fish in the ocean (read – TradeMe, Xero). Like his mates previously, O’Donnell goes on to lament the confusing proliferation of incubators and accelerator opportunities available to aspiring startup companies. However there’s conveniently no mention of the actual economic value created or new jobs that have been delivered by such institutions.

On the other hand, he loudly sings the praises of two companies led by extraordinary women and illuminates them as exemplars of real startups that deserve success. He’s right about both of them of course, but he conveniently neglects to mention that both companies received a leg-up from the very ecosystem that he dislikes so much. Furthermore, some of the the commentators backing his position are folks who also benefited from being part of the startup community. That’s hard to reconcile.

Opposition to state funding of startup programmes springs from a deeply held philosophical belief in some quarters that only well funded companies with friends in the right places should be allowed to succeed. Now it’s very unlikely that the incoming Labour government will roll back recently announced funding for accelerator programmes, but they will no doubt be reviewing how to deal with promoting innovation and entrepreneurship in New Zealand in the future. That’s an opportunity, so understandably Mike wants to influence that debate. But I disagree with his position and here’s why.

Whilst many of us agree that the startup venture model is less than perfect, that’s not a good reason to pull public funding from the sector. As a nation we must diversify way from commodities and move up the value chain. Let’s take the wins when they come and accept there will also be some failures along the way. Government support comes in many forms across the spectrum from enabling academic research commercialisation through to co-funding accelerators. Arguably we are not doing enough compared to others globally. I don’t see any criticism of Israel or Australia, nations that actively and successfully apply substantial government support to their innovation ecosystems.

Having taken a company through the Lightning Lab accelerator this year (and bootstrapped a previous tech company from nothing), I guess that makes me one of the “bottom feeding” losers mentioned in the article. I find that analogy quite offensive, especially since (for the record) we received no funding handouts whatsoever within this year’s Lab. Let’s work together to achieve good outcomes for New Zealand and ensure there are a mix of great programmes with excellent community partnerships in place and that solid companies with real customers get oxygen to move forward.

Postscript:

Mike O’Donnell reached out to me recently and we had a chat about the context of the term “bottom feeder” that he used in his article. Mike sees bottom feeding species (such as Snapper) as the healthy foundation of the ocean ecology and I accept that his analogy was not intended to be derogatory. As I originally mentioned, we all have huge respect for what has been achieved by companies that have a connection to the TradeMe story. There’s a role for all kinds of fishes in the ocean. We should try to work together to ensure sustainability and longevity of the fishery.

Paul Spence is a commentator and serial entrepreneur, a co-founder of Wellington, New Zealand based technology ventures iwantmyname and Polanyio and a founding mentor with Startup Weekends and Lightning Lab. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Innovators Online Again

It seems like half a lifetime ago that myself and Annick Janson established New Zealand’s first online community for innovators and entrepreneurs (ION). It was a clunky PHP forum site that we managed for hundreds of users thanks to the support of University of Auckland School of Business and Revera. After ten years and a couple of post-graduate research projects between us, we reluctantly moved on to other endeavours. But the need for a community platform did not go away.

So I was thrilled to discover recently that the NZ Innovation Council now has a community site on offer. The new site provides lots of fresh content about New Zealand innovators plus a discussion forum and event listings. In the tech world timing is everything and I guess ION was a little bit ahead of its time. I remember sitting through numerous dull meetings with risk averse public servants who just couldn’t see the opportunity and chose not to support us (including one in particular who subsequently thought spending half a million on a boxing match was a great use of public funds – go figure). Judging by the list of sponsors now backing this new initiative, the change of guard at both NZTE and Callaghan has been a positive thing. </rant>

One of our first sign-ups on ION was a bloke working hard on building a little accounting software startup that you might have heard of. There was lots of great conversations on the forum and we helped a bunch of people. What we learned from our initial efforts in this arena was that valuable knowledge truly arises when you facilitate social engagement. In New Zealand we tend to work in silos, but only through collaboration can we create meaningful impact in the world. Online communities are part of the mix, because we need to push beyond the mindless dross of the big social platforms that do not have our interests at heart.

I commend the NZ Innovation Council for this initiative and encourage everyone to sign up and get involved by sharing ideas and content.

Paul Spence is a commentator and serial entrepreneur, a co-founder of Wellington, New Zealand based technology ventures iwantmyname and Polanyio and a mentor with Startup Weekends and Lightning Lab. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

March For Science Matters

Last weekend’s March For Science may have been largely symbolic, but it was important. When a government appoints a rabid climate change denier to perform a hatchet job on its own environmental agency, you know that somebody has seriously lost the plot and voices need to be heard.

Interestingly even China is now becoming increasingly concerned around problems created by climate change and has committed to refactoring the economy towards green energy. It’s a bit like trying to turn around a super-tanker, but I suppose you have to start somewhere. But it is very difficult to reconcile that technologically adept nations such as the United States are going in the opposite direction to almost everyone else on the globe.

The role of science in economic growth and development has long been established. Science driven technological innovation has been a key contributor to our advancement as a species over the last few hundred years. From health to computing to space exploration, science has been at the base of almost every step forward. We live longer and more fulfilling lives, largely due to scientific discoveries.

Conversely, science has arguably also been responsible for some of our backward steps. Industrialisation, internal combustion engines and nuclear weapons are also products of the science lab. Science therefore is no panacea. The philosophical and morale context around science is ever-changing and what seemed like a good idea 50 years ago might be framed very differently by future generations. Scientific theories also evolve over time as new ideas emerge and get tested and old ideas are discarded.

What we do know is that the scientific method provides a solid basis for exploring and understanding our world. Discarding rational thought in favour of rumour and outright lies may be a successful political strategy, but it will certainly not help us to address the pressing social, health and environmental issues in the world.

Paul Spence originally completed a B.Sc. degree in Applied Geophysics and was previously employed as a support meteorologist in the aviation industry. He is a commentator and serial entrepreneur, a co-founder of Wellington, New Zealand based technology ventures iwantmyname and Polanyio and a mentor with Startup Weekends and Lightning Lab. GeniusNet is working to support global environmental projects through its portfolio companies.

You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Big Ideas Poor Execution

In early 2014 the Wellington City Council announced a series of “big ideas” to boost economic growth in the city. Predictably, in the two years since, there has been little progress.

For starters, it was always clear that the airport runway extension was not a good idea because of technical reasons that I have outlined on numerous occasions. What was less clear, was the business case to justify a ratepayer funding subsidy based on these illusory benefits. It subsequently emerged that the real reason for the extension was to make it safe for existing aircraft. Something that the airport should have taken care of years ago.

The Miramar film precinct and creative enterprise zone idea sounded promising at first, but once again there seems to have been little progress. Additionally, Shelly Bay (see photo above) on the Miramar Peninsular is ripe for development but has been an embarrassing eyesore for many years because the ownership can’t seem to work collaboratively and constructively. A number of attempts have been made to move forward on developing the area but once again nothing has happened yet. The film museum now looks set to rise on a site opposite Te Papa, co-funded by the city. At least we have that to look forward to.

Finally, and most disappointingly, there was the concept of a tech district based around the Cuba Street precinct, where many of our most exciting startups and technology sector companies reside. Our office is located in this area and I’m not aware of any initiatives yet. In fact council staff have been putting up more yellow stickers and telling building owners to get concrete masonry sorted or suffer the consequences. So the future of the area is sketchy, especially in light of recent seismic activity.

What did happen in the previous two years was that the council invested a huge sum of ratepayer funds into a vanity project aimed at helping a private company set up a large co-working space on the edge of the CBD. It’s a good venue, but initially bold community-building objectives seem to have fallen a little by the wayside this year. I’ve also heard one or two newly elected councillors privately express their reservations over this and the lack of innovation support generally. Now that the Grow Wellington model has been homogenised and had the life crushed out of it, the incoming council are trying to figure out how to fill the vacuum.

Overall I’m worried about Wellington’s crumbling economic competitiveness, a scenario which is likely to be compounded by the hidden effects of a slow-moving earthquake impact, including incapacitation of the container shipping terminal. There are many old and damaged buildings in the city now and (unlike Christchurch) there does not seem to be a unified vision about renewal of the inner city. The old town is looking dated and shabby, whilst our neighbours in Australia and Asia surge ahead. This situation has crept up on us, but it’s time to cut through the political window dressing and admit we have a problem.

Paul Spence is a commentator and serial entrepreneur, a co-founder of Wellington, New Zealand based technology ventures iwantmyname and Polanyio and a mentor with Startup Weekends and Lightning Lab. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Parochialism Will Ultimately Fail So Think Globally

Australian Prime Minister Turnbull’s recent flying visit to New Zealand, to meet our new PM Bill English, was a considerably more civil affair than Turnbull’s reportedly heated conversation with the “so called” U.S. President the previous week. Perhaps that is why the visit went under-reported in the media. Neither Prime Minister could be regarded as a stellar charismatic, but perhaps that’s not such a bad thing. In these unenlightened times, a safe pair of hands with good diplomatic skills and a head for business is a far greater asset. Strengthening regional economic linkages will be key to survival in an uncertain world.

During that top level meeting in Queenstown a cooperation agreement on science and research was signed that paves the way for more trans-Tasman collaboration. To the popular media, topics such as this are about as dull as a damp dish cloth and the agreement went largely unnoticed. That’s a shame because everyone needs to understand how important regional cooperation is becoming to the economy. How we play within Asia-Pacific will have implications for our future opportunities and prosperity. The disturbing shift (in some quarters) towards isolationism and protectionism demands that we build stronger regional relationships.

There needs to be a local mindshift as well. I’m tired of well-meaning local government agencies constantly banging on about how they are making over their cities into the next big centre for technology innovation. It’s a ridiculous notion. The entire population of New Zealand could fit into most major cities on the Asia-Pacific rim, with whom we are in a battle for capital and talent. We contribute 0.1% of the global economy and we are under-cooked by most measures in terms of science and technology research and innovation commercialisation. Short-sighted parochialism makes no sense and must end now. Our businesses and civic leadership need to get with the programme and start connecting regionally.

I had a conversation along these lines recently with Shawn O’Keefe, formerly a co-founder of South by Southwest (SXSW), a huge global film, music and interactive media event. Shawn is currently based in New Zealand and is now an advisor to the Myriad event launching in Brisbane this year. Myriad is supported by the Queensland government, which is pouring a huge investment into promoting innovation in the Sunshine State. Myriad is a three day festival of art, technology, innovation and investment match-making. A key theme of the event is that we need to collaborate regionally to compete globally.

It would be great to see a strong contingent of New Zealand tech founder entrepreneurs at this event.

Image credit: Paul Spence

Paul Spence is a commentator and serial entrepreneur, a co-founder of Wellington, New Zealand based technology ventures iwantmyname and Polanyio and a mentor with Startup Weekends and Lightning Lab. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Ashes To Ashes 2016. Now Welcome To 2017

Let’s face it, last year was a pretty shit year for fans of popular music and culture. I don’t care what the statisticians say, the catalogue of highly talented stars that made premature exits in 2016 was exceptional and shocking. However the media were (mostly) too polite to mention that the collective drug consumption of the dearly departed probably supported a number of small South American nations’ economies throughout the 1970’s and 80s. All tragic losses, but perhaps not entirely unexpected.

Less predictable was the outcome of the U.S. election, a result so unpalatable that we can only hope that the American political establishment will find a way to put matters right, before there is a very nasty accident involving long range armaments or fiscal collapse. One way or another, I very much doubt Trump will see out his four year term. The Brexit debacle was equally disturbing and was also another example of a poorly informed, inward looking minority being allowed far too much influence. But of course it would not be democracy if we excluded people with double-digit IQ and questionable heredity from voting.

At a time when irrational fear, regional isolationism and misguided notions of nationalism seem to be taking root globally once again – it is important that thinkers give voice to their concerns loudly and often. Important because intellectualism usually becomes an early victim of the mob, when rational thought gives way to populism and slogans. History repeatedly shows us that this never ends well.

So I was at first encouraged when I read this opinion piece on how we all need to work together to create a sustainable economic future for New Zealand. Whilst I certainly agree with the sentiments, I disagree that this approach is predicated on Auckland as the “centre of innovation” for New Zealand. In fact the problems of Auckland are analogous to arterial thrombosis. If the heart fails, the entire body will die – and that’s a big issue for all of us in New Zealand. Regional relationships and complex networks are the better approach, as I have discussed previously, with regional linkages and multiple innovation hubs.

For my part this year, I intend to continue to connect entrepreneurs and innovators from across New Zealand and abroad and to contribute economically by working on growing the businesses we have under the GeniusNet portfolio and (hopefully) add one or two more during the year. I will also continue to speak out on issues, especially those that relate to economic development. It is about time the citizenry had greater influence over decisions than those self-serving politicians whose main aim is building grandiose edifices to themselves. Here’s something good from 2016 that gives the world hope in this regard. Thanks Audrey.

Paul Spence is a commentator and serial entrepreneur, a co-founder of Wellington, New Zealand based technology ventures iwantmyname and Polanyio and a mentor with Startup Weekends and Lightning Lab. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Mrs Clinton Misses

clownObserving the U.S. election result unfold was very much like watching a slow motion train wreck – ugly but also fascinating. That an arrogant, racist, misogynist with no experience of political office could even make a party nomination (let alone win the presidency) speaks volumes about a badly broken America and a failed political system.

No doubt there will be endless soul-searching and detailed media analysis of the result. But the media are themselves thoroughly complicit in this disaster. Ironically the Washington Post best summed up the situation with an introspective opinion piece on how the liberal media’s self-satisfying world view completely ignored the real story of growing pain and dissatisfaction in heartland America. The Republican president-elect appears to have successfully tapped the disenfranchised, angry (and largely uneducated) under-belly of American society in the same way that Brexiteers and Far Right have damaged Europe.

The presidential candidates collectively spent an estimated $3 billion on their campaigns. Imagine how many small businesses could have been created, roads repaired or schools upgraded with that money. The new president may have a majority Republican senate to lean upon, but he will not be able to deliver on the economic pump priming and rejuvenation of the sunset economy that he implied during his campaign. Grassroots supporters and swing voters will have four years to contemplate their error of judgement.

The political elite woke up this morning smelling the rotten corpse of the “American Dream”. It remains to be seen whether or not the nation can be reunified with a changing of the guard. The traditional approach to doing so is to find a diversion in a common enemy. That is also a disturbingly real possibility with the next administration and a chilling prospect for all of us.

Paul Spence is a commentator and serial technology entrepreneur, a co-founder of iwantmyname (a New Zealand based global Internet venture) and a mentor with Startup Weekends. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Is Lean Thinking Killing Creative Thinking?

As a frequent Startup Weekend mentor (and co-founder of a successful boot-strapped tech company), I have had plenty of real life exposure to the doctrines of lean startup. But a recent experience has started me questioning whether we are doing ourselves a disservice through slavish adherence to lean methodology and an overly prescriptive approach to starting up.

Let me be clear. The Lean Startup framework provides a solid foundation for anyone who has not previously been in business and for whom resources are scarce. Starting a business is hard and developing a new business model is especially difficult. Coming from a science background, I’m very interested in how Lean Startup takes an experimental approach to testing hypotheses. This makes a lot of good sense. What makes less sense is when being Lean constrains our imaginations.

But I think there’s a way to resolve these tensions. There are two fundamental issues faced by a new startup and (to put it bluntly) not much else really matters outside of these two.

  1. Are you addressing a real problem that people will pay you money to solve?
  2. Can you position your solution in front of those people?

If you can answer these two essential questions, you have a shot at building a business. If not, fail fast and start over. At the forefront of your mind should be that customers are your chief source of capital, not investors. Engaging with customers early and identifying their problems is essential. Gaining venture funding is not a business model. Most businesses in the real world are NOT funded by venture capitalists.

By all means deploy Lean Thinking in your startup to discover customers, create value and extend your runway without becoming reliant on external funding. Indeed, a successful first product iteration that earns an income stream can provide a pathway to explore bigger ideas in the future. But please don’t let Lean Thinking kill your dreams. Many of the greatest tech companies started small and created their own markets. Be an entrepreneur scientist. Keep experimenting. Entrepreneurship is a creative endeavour, which is why many of us are drawn to it.

Paul Spence is a commentator and serial technology entrepreneur, a co-founder of iwantmyname (a New Zealand based global Internet venture) and a mentor with Startup Weekends. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Network Effects Strengthen Our Economic Game

networkI really enjoyed attending Project16 this week. Offering a nice blend of business, philosophy and creativity, the event attracts an esoteric mix of thought leaders from the United States and bakes them with a sprinkling of local influencers, thinkers and doers. What I like about the event is that it challenges our thinking and helps build connectivity by creating a diverse set of connections. That’s important for an island nation that lies a long way from global markets.

It was also a relief that most speakers generally avoided trotting out the usual slogans such as “number eight wire” and “punch above our weight”. Self-congratulatory (but outdated) language such as this should be forever confined to the 20th Century. We also need to move away from parochial attitudes to economic development. It’s no longer acceptable to be championing specific regions or cities as the centre of gravity. Wellington is no more the “centre” for film production than Auckland is the king of software. Yes, we do have regional strengths, but we can leverage these better by working together.

Economic development is not a zero sum game. But everyone can win through collaboration. Rather than trying to compete individually for capital and talent with mega-cities of Asia-Pacific such as Hong Kong, Sydney and Los Angeles, we need to be building relationships and making deals regionally that are more competitive. For example New Zealand tech startups are now accessing capital in Asia. The Sydney “fintech” scene is doing the same. We could set up more “sister city” relationships that have a meaningful economic basis, rather than a political or ceremonial objective. Deal-making should be driven by identified opportunity, rather than through meddling by governmental agencies.

For this reason, pundits who predict that extending Wellington airport will thrust the region onto the global stage are mistaken. Apart from the technical and economic reasons I already outlined that militate against this silly idea, we actually need to switch the thinking towards complex networks, where much greater value is created through diversity. That means it’s also totally fine (and indeed desirable) for air transport links to hub through Auckland, Sydney, Adelaide or Melbourne.

Paul Spence is a commentator and serial technology entrepreneur, a co-founder of iwantmyname (a New Zealand based global Internet venture) and a mentor with Startup Weekends. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.