South East Queensland 2014 STARTUP ECOSYSTEM REPORT 1 A simplified network map of the ECOSYSTEM RMSS Blue Sky Retail Express AMMA Guvera Techspace Transition Level Budding Investments Entrepreneurs Grant Silicon Tappr Lakes CA iLab Halfbrick Liquid State Ollo Mobile Brisbane Angels Griffith River Enterprise City Labs SwipeAds Innovation Centre Right Pedal QUT QUT Creative bluebox Enterprise Nimble Australia RedEye UniQuest Fitgenes ZOVA Euclideon CONTENTS Dashboard 5 About 6 Context 7 Breeding Unicorns & Building Ecosystems 10 Formation 12 Organisations 14 Funding 16 Groups 20 Incubation 21 Key Nodes 22 Location 24 Regional Data 26 Markets 28 People 34 Community Ideas 38 References 40 3 4 Summary statistics as at July 2014 DASHBOARD No. STARTUPS PEOPLE: COMMON SKILLS No. CO. TEAM SIZE Strategy 18% 40% Marketing 13% 226+ 8% Estimated number of startups within SEQ.* Leadership 31% Business Development 7% Start-ups 7% No. FOUNDERS Entrepreneurship 7% Management 7% Project Management 6% 500+ Social Media 6% 2% Estimated number of startup founders within SEQ. 1% Management Consulting 6% 1 2-10 11-50 51-200 No. PEOPLE **** #STARTUPS BY MARKET FOCUS (TOP 10 ONLY)* PEOPLE: AGE % ** 41.0 Arts & Recreation Services 19% 41 Information Media & Telecommunications 19% 36 ~1,900 *** 32.8 Estimated number of SEQ startup employees. Other & Unknown Services 15% Health Care & Social Assistance 8% 24.6 Professional, Scientific & Technical Services 5% Finance & Insurance Services 5% No. MEETUP GROUPS 16.4 Retail Trade 5% 4% 11 Advertising Services 9 3% 8.2 Administrative & Support Services 5 107 3% Associated with startups, tech and entrepreneurship. Education & Training 0.0 18-24 25-34 35-44 45-54 55+ . No. SUPPORTING COMPANIES No. STARTUPS & GROUPS BY YEAR FOUNDED ****Number of Startup Companies founded by calendar year in the “No. Startups & Groups by Year Founded” 60 Startups 55 graph does not equal the total “No. Startups” as the Groups founding dates of some startups within SEQ were not ~550 50 identified. Estimated number of companies involved in the startup ecosystem. 40 30 . 29 28 26 25 No. ASSOCIATED PEOPLE 23 23 20 13 10 10,000+ 8 8 10 Based on the number of members of technology Meetup 0 groups and employees of startups & supporting entities. 2009 2010 2011 2012 2013 2014 TOTAL FUNDING RAISED BY STARTUPS *Note, while the report uses the Australia New Zealand Industrial Classification (ANZIC) to classify the “Market Focus” of companies, this does not represent $ their industry classification, but rather the target market 37M of a startup company - the market they are addressing. Estimated total amount of funding raised by Queensland **Arts & Recreation Services includes Digital Game studios and developers. Further detail on this Startups between January 2009 and July 2014. classification can be found in the footnote on page 31. ***Other & Unknown Services is predominately made TOTAL FUNDING RAISED up of unclassified companies. $126M Total funding raised from January 2009 to July 2014 by Queensland Startups and Established Digital Technology companies. 5 How and why. ABOUT PROJECT AIMS DEFINITIONS Support Entities Key organisations that support the development of This project aims to quantify the ecosystem around Startups startups such as incubators, accelerators, meetup groups early-stage high growth digital technology companies There are varied definitions of high growth early stage and venture capital firms were included. (startups for short) from South East Queensland (SEQ) digital technology startups. Whilst any type of early- - identifying key people, organisations, events and stage business can be called a startup, for the purposes Incubator: an organisation that offers mentoring, office innovation hubs within the community around which of this project the definition used by StartupAus, space, and other resources to help startups grow. Whilst innovative activity is centralised. The report aims to Google Australia and PwC Australia was adopted: a incubators assist startups in raising funding they do not measure its comparative strength, identify critical issues ‘startup’ is a company primarily focused on developing provide investment in return for equity. Their programs within the ecosystem, and identify potential areas for innovative digital technology, with a high leverage on are generally open, longer in duration and relatively government intervention and collaboration. labour, an innovative scalable business model, capable of unstructured. rapid growth, and under five and half years in age. SCOPE Accelerator: accelerators or seed accelerators are Digital In terms of scope, the report maps the primary people similar to incubators, but differ in that they take an The project focused on companies that create value (founders, angels and other participants), organisations equity portion of their participating startups in return primarily around digital technologies such as developing (startups, venture capital firms, co-working spaces, for investing seed capital - where incubators do not. software products or services, scalable hardware incubators and government agencies), groups (angel and Accelerators generally have a structured program that based products and services such as drones, sensors, community groups) and events (awards, conferences, runs over a discrete period of time (often 3 to 6 months) autonomous vehicle technology, Internet of Things programs) involved in or supporting early-stage after which the startup ‘graduates’. (IoT) technology, and wearables. technology startups within South East Queensland. Groups: community groups or meetup.com groups Exclusions The report only includes those companies and people that meet together in fairly informal circumstances to Digital technologies are being deployed across all that have made a direct tangible contribution to the discuss digital technology, startups or entrepreneurship. industries and permeate all aspects of our society. The development of high growth startups – whether that be This data is almost entirely based on meetup.com borders between industries are being eroded making through mentoring, sponsorship, investment, grants or groups which is a worldwide platform for organising it increasingly difficult to say whether a new company space, etc. community groups and widely adopted within startup like Uber is a transport company, software company, or communities worldwide. a labour hire company. The reality is that an increasing The report attempts to quantify in detail the fund flows (majority) proportion of Australian businesses have to startups based in SEQ. However it does not quantify Funding & Investment digital technology as a core component of their the amount of investment flowing out of the state into The report captures information on the money raised business. external startups. by technology companies and startups to fund company and product development. Startups secure funding in Consulting: The project excluded non-scalable A seperate report mapping the regional Queensland multiple ways: private investment, government grants, companies engaged with digital technology, such as startup ecosystem will be available in November 2014. crowdfunding, public investment, prizes and loans. The those with a high reliance on manual labour such as report excludes money flowing out of the state into digital design studios, digital marketing, software METHODOLOGY startups from other states or countries. development houses and computer consulting companies. Technology support, networking, and The report was compiled in partnership with several When the report refers to Funding, Investment or computer repair businesses were also excluded. community organisations and government agencies. Matched Funding it means: Information was gathered through workshops in Similarly excluded were design and development companies providing IP development as a service purely Brisbane, on the Gold Coast and the Sunshine Coast, Funding: the report means all types of funding for other firms such as advertising agencies that build and from interviews with over 35 people within including private investment, government grants, mobile and web apps for clients or gaming studios that the community. Information on people, events and matched funding, crowdfunding, public investment, purely work for clients. However, many companies companies was also gathered using data from online prizes and loans. While crowdfunding is technically a build potentially scalable digital products (e.g. iPhone platforms including Linkedin, AngelList, ASSOB, way for customers to pre-order a product or service the apps) alongside their consulting services, in which case CrunchBase, Gust, Twitter, Eventbrite, Kickstarter, report includes it within the analysis of startup funding they have been included. Pozible and Meetup, and complemented with internet as it serves a similar role to other funding methods. This research. definition excludes the Tax office’s R&D Tax Incentive. Established Technology: the report excludes digital technology companies established prior to 2009 from Combining several data sources gives a more Investment: the report means private or public equity the definition of a ‘startup’. However in some cases the comprehensive view than one in which information is investment in a company in exchange for shares in the report mentions companies, investment figures or entity taken from any one individual source. For example, company, including convertible notes, options and other numbers for more mature