Why we kept our startup in Australia

One thing that really stands out about Australia is that tech startups here last a long time (they don't seem to ever 'run out of money'). Investors are patient and they invest cautiously; in fact, if they like your idea, they will 'keep tabs' on you and they won't invest a single dollar until you have some meaningful numbers to show them - And by numbers that means either decent revenue (yes, REVENUE) or exceptional user growth (coupled with a clear monetization plan).

That's both good and bad. It means it's very difficult for early starters to get funding in Australia, but it means that once you do get that funding, you can expect the investor to stick around. I have worked for 2 startups which had been operating on a modest loss for 5+ years - One of them had almost no growth and little potential (in my opinion), the other had modest growth but high potential. These startups don't seem to have problems raising further rounds of capital year after year.

I found that Australian startups are lean and have a low marketing budget - They tend to spend everything on the product and generally don't like hiring sales people or paying for advertising unless it gives them an immediate, measurable return - They don't spend money just to create hype.

Australian founders tend to dismiss the importance of advertising - They believe that if they put all the focus on product development, that eventually, the product will become so good that it will just blow away the competition (who have wasted all of their funding on advertising).

US startups generate a massive amount of noise in the market - Spending on advertising at the moment would just create more white-noise - You won't get a return on that. At least that's the general belief.

Obviously the VC funds are different, and nowhere near the scale that they are in the US or China right now. Still, there is a lot of wealth in Australia seeking investment opportunities.

It would seem to make perfect sense to stay domestic and contribute to building up the tech scene there.

There are problems with the generalizations in the article though. The author talks about American entrepreneurs being, basically, obsessed with get rich quick schemes, and that outcomes are more binary in the US - that's mostly a Silicon Valley cultural thing. There are tens of thousands of successful tech companies all over the US that have grown themselves slowly, are great businesses, but are not unicorns, and are not an all-or-nothing proposition. Why didn't the author look at other tech start-up cultures in the US as an alternative? Alternatives exist in every major city. I get that, in that scenario, it makes as much sense to stay in Australia - so then why mess with Silicon Valley at all, by now it's pretty blatant what it's all about. That contradiction left me confused.

For example, I’ve learned so much by deploying my two products, doing marketing myself, and am currently developing a new breed of test management tool that integrates other of my own technologies that actually help with managing testing (IMO, current test management tools are simply glorified DBs with dashboards) — something I have been very passionate about for years.

Also, I have never identified (or agreed) with the new mentality in the US for creating companies a-la Amy Hoy. At the worst case, such “strategies” teach you how to steal someone’s idea and build something for which you feel no passion, just to become rich.

I wish them and their company the best and hope it grows in a way that keeps making them happy.

Thanks for posting this article!

For what it's worth, this is a "post-unicorn" phenomenon. San Francisco has been overrun with entitled assholes as it has become the trendy new place for get-rich-quick schemes. It wasn't that long ago that it was considered insane by investors to put a company here (for good reasons, actually: it is insane to have a company here. People now just arrogantly want to change the existing city to fit their greed, rather than go somewhere more practical.)

A lot of the people who were doing startups before the Rise of the Unicorns -- many of whom are now famous and powerful people -- were, frankly, lunatics. I wouldn't say that they were modest, exactly, but they also weren't exclusively focused on money -- it wasn't clear that anyone was going to make any money! Maybe I'm being romantic, but it seems like there were more interesting people, doing interesting things, and hoping to have a good time along the way. There was more thought, because there was less money, and people had to be careful.

Today, the interesting people are fewer and further between, and the question is less "how can I make something great?", and more "how can I get investment?" Nobody gives much of a shit about anyone else, because if there are any externalities, hey, that's just "disruption", bro. It's awful, and has probably destroyed the culture that produced those unicorns in the first place.

On the positive side Australia is a great place to live, just a massive up hill struggle as a place to build a technology based business.

The whole "there's no Australian Secret or Pets.com" really sounded like sour grapes to me. Do Texans (people from a region of similar population size and GDP to Australia) boast about their lack of spectacular technology company failures?

Why not just say, "Australia is bloody awesome, it's home, and we've decided to stay for that reason. We're living proof you can flourish as a startup in Victoria. It turns out that we decided that we didn't want to move to the Bay Area."? I'd really be interested in the details of how they actually got it to work (marketing, customer relationships, developers).

That being said, I'm very grateful that they posted a blog about it. I've found Australian companies to be fairly tight-lipped in comparison. The more exposure there is to Australian technology companies, the more opportunities for customers and investors will materialize.