Disruptive Coffee

by Nick Stanley

A soft landing

It was a soft landing in San Fran airport following a short interlude at LAX.  Unfortunately, my plans had already been a bit “disrupted” due to a schedule challenge which meant I was mid-meeting in Melbourne as my Mel-Syd-SF interconnecting flight was leaving…oh well, some frantic activity, a little bit of craziness, and I managed to grab the last seat on LAX-bound QF93 departing Melbourne.

As they say, no harm, no foul (right Sue!), as I got there only slightly late and was welcomed by a traditionally sunny, if a little windy, San Fran day.

And, it was also a soft landing into the startup community, with a welcoming embrace from the likes of Sonja Gibson at Investment Vic and Margaret Donoghue at Austrade.  We have some great advocates, and super connected folks in “the Valley” and they ensure any reasonable and considered overture is rewarded and gets the right level of support.

I caught up with Sonja off the back of a four-day “marathon” with Minister Philip “the startup animal” Dalidakis, our globe-trotting Minister of Innovation and all things disruptive.  A great addition to the startup space in Victoria and someone who is really getting out there and doing it for the team; I’m really supportive of the Minister’s new portfolio and think he brings some great skills, and clearly a lot of energy, to the role (isn’t that right Sonja?).

Anyway, Sonja was a little bit worse for wear and on the tail end of her San Fran autumn, ahead of a placement in London (which will be great for Vic-London connections), I left her sipping green tea in Hayes Valley and headed down Market St to catch Margaret from Austrade and then on to a catch-up with another regional Vic export, Ned Dwyer of GoDaddy, StartupMate and the founder of Elto.

In meeting with Ned I made a few interesting discoveries. Firstly, that Aussies like a beer no-matter where they are. Secondly, that Ned’s a genuinely nice bloke wanting to put back in to support others. AND THIRDLY, that just about every Aussie I meet that has had some level of success wants to pave the way for others!

Really, that mindset is such a great thing and I truly believe that the “pay it forward” mentality is a powerful influencer that will definitely bolster our own startup community.  It’s also important that we support people like Ned as their experience is invaluable and worth so much more than hypothesis…it’s the practical application of learning that leads to magic.

It’s great to see that Ned is a key part of StartupMate (www.startupmate.com) and one of the leading mentors in the program; it’s what it’s all about.

Aussie done good

From one “Aussie done good” and on to another; Day Two was a chance to a catch up with my good friend Cameron Yuill.  Cam is another Aussie export that has done well in the Silicon Valley and is doing great things, especially with his new Propeller Fund.

He is a generous bloke and really well connected and that is one of the great things about Aussies in the Valley; we help each other out.  Cam really pays it forward and for that, he earns a big R for respect.

That said, and as I’ve discussed with many, don’t go there unprepared.  You’ve got to study the playbook and understand how things are done…get the lingo, grasp the levers and go for it.  But don’t stand about wondering and, for god’s sake, learn how to pitch.  It is really disappointing to see the number of Aussies who fail in the Valley because they get offered great connections and then don’t follow up with their A-game.

Come on guys, we are great innovators, we have grit and we’ve got our own style, however, you’ve got to have a polished pitch; there is no excuse for having a second-rate pitch. Quality intros in the Valley (and other startup ecosystems) are gold; you’ve got to follow up, follow through and bring your gold-plated, Grade A pitch.

It’s OK to be different, in fact, I think it’s great to be different as it sets you apart and makes you and your business memorable. However, there are some standards and basics you’ve got to hit:

  1. Get the idea out of the way early (the idea is 5% of what is going to make you a success)
  2. Explain what is different about how you are going to achieve this
  3. Explain what you are going to do with their support
  4. Recap on your traction and secret sauce
  5. Be clear on the ask and what you plan to do with it
  6. Stick to the time, polish your presso, rehearse and for god’s sake, don’t suck

These are just some of the basics, but practice makes perfect, and it’s a key to our Runway program that we are going to teach people how to pitch with the best.

Improve Search at Google

On to Day Three, and I know I’m jumping around a bit here but I’m allowed to (it’s called poetic license) and this brings me to the Maven Growth Retreat – the whole motivation for my trip.

Proceedings were kicked off with a forum between founders from LOLapps, Dropbox’s Growth Engineer, Darius Contractor, and others from Twitter, Facebook and so-on.  It really was a star-studded start to the program from people who’ve been there, done it and bought the McLaren to prove it.

The session was very focused on product-market fit and the “tipping point to growth” focus with some great input and feedback on using analytics (great advice, Darius, and something I’ve taken to heart) coupled with some very practical, case-study examples of things that did and didn’t work. Annie Chang from LOLapps, for instance, offered up an example of early traction, or lack thereof, in LA – and how some fine-tuning turned user engagement around from 10% to 50% and on to a doubling of users every week.

The morning progressed with Ken Rudin, Head of Growth for Google Search, taking the conch.

Now, just think about that for a moment – Head of Growth at Google Search…how do you grow search at the biggest search engine in the world; an application that is synonymous with the internet?  It’s just about the (if not THE – note the capitals) most widely and frequently used single application on the planet and its Ken’s job to increase that usage.  Fair to say, it’s quite a big job!  No pressure then…

Anyway, after ruminating on this for a while, I switched my focus to what Ken was saying and there was some absolute gold there.  Sure, some of this only applies to businesses that have the type of scale that few of us will ever experience, but the way Ken looks at problems and challenges is unique, as is governed by his remit, and his four principles of growth are valuable to anyone:

Principle 1: Flatline retention

You need to find a stable baseline for your retention rate, no matter where that might be (and what KPI you use to evaluate it).  From there, you can experiment to see positives and negatives.  Without a flatline, it makes it hard to evaluate cause and effect.

Principle 2: Increase discoverability

Sort of speaks for itself, but the nuance that Ken bought to this was what made it powerful. Move the button by an inch (that’s 2.2cm!) and we see a 3% change in clicks…user experience can be a KEY factor here.

Principle 3: Growth is a game of inches

I said an inch, and inches it is!  Like that movie “Any Given Sunday” where Al Pacino rallies his team with a stirring speech on gridiron (that’s rugby for softies). Growth is not about lock-step change but about experience: finding that small change that adds a few percent, pocketing that and moving on to the next.  After you’ve pocketed 10 of those changes, you’ve lifted your KPI by 30%.

Principle 4: The growth process begins with data

And, it all falls apart without a metric!  You know what they say about lies, damned lies and statistics, well, statistics are sort of useful in startup world.  Without data it’s impossible to evaluate cause-and-effect, to target the small changes and to measure the impact.

Woo-ha!  As Al would say.

Nir Eyal and all that

From there, the talks and presentations just kept on coming, a flow of hits! It was all I could do to just keep on scribbling out the thoughts, provocations and ideas elicited by the solid gold that was being served up by each and every session.

Want to know what three of the biggest Series A funds in the Valley are really looking for, and talking about, when you are raising? Maven served that up.  Want to focus in on engineering for growth, fanning the flames, the X-factor, guerrilla tactics?  These were the subjects of hosted lunch-time discussions.

All in all, the day was without a single flat spot; it was a fantastic, motivating experience.

But that said, no-one could eclipse the absolute star of the show: Nir Eyal.

A polished presenter, Nir delivers his unique view of behaviour and steps us through his “Hook” in a mesmerizing 20-minute session that can only be described as life-changing.

If you haven’t already done so, do “a Meldrum” (this means to “do yourself a favour” for anyone post-Gen X) and go out and get his book, entitled ‘Hooked’.

‘Hooked’ speaks to the levers and drivers that create habit-forming behaviour and that sit behind the success of many leading startups.  Nir delivers the key points superbly but then drills down to practicalities and spells it out; it’s a lesson in how to build engaging, habit-forming platforms that has got to be a key focus for any founder intent on success.

It’s powerful stuff, and Nir rightly warns us to “use your powers for good”. The onus really is upon us to carry that forward.

Regional startup godfather

Another key part of the program with Maven was the opportunity to connect with folks and it was with great enjoyment that I spotted Wil Schroter across the room over lunch.  Wil is a regional startup doyen, having founded a super-successful business (and then following on with a bunch more!) in the confines of regional US of A.  Wil understands acutely the challenges faced by regional ecosystems but also the unique and often innovative solutions that can come from such left-field locations.

Challenges such as the tyranny of distance, space, incremental transformation and change in economies all drive different experiences outside the capitals and larger centers and so, sometimes, regional startups can provide really compelling and unique solutions to problems that have not crossed the zeitgeist of the populous in the built-up spaces.  What’s more, regional centers can also provide startups with a unique runway, in that the cost of talent, the cost of living, the work-life balance and other things can really super-charge your startup in the early stages and then give you a boost as you gather pace for a running jump into one of the bigger ecosystems.

Wil knows this and also shares a genuine passion for entrepreneurship, no matter what the space or where it finds itself. It was great to see Wil again and talk to him about connecting our Runway program in to his Fundable platform.  It really is about a hub and spoke model, as regional ecosystems come to play the game and factor in to the larger centers and it is people like Wil, Cam, Ned, Sonja, Margaret and others that make this possible.  Thanks guys.

Kyle Vogt and Unicorn Number 6

The Maven Ventures retreat was then finished off with a bit of a fireside chat with Kyle Vogt…Kyle’s journey put everything into focus and really helped to provide a good point of reference.

Cruise, which is one of the investments Maven Ventures made in its first fund, is Kyle’s second startup and also the sixth fastest startup of all time to have achieved a billion-dollar valuation (ie: it joined the “Unicorn Club”).  What’s even more powerful is that it did so mid-pivot and was acquired by General Motors, not a company known for its risk appetite.

It’s amazing stuff and speaks volumes about the traction that Cruise was able to generate and the product-market fit they achieved. It also underlines the clarity and apparent “achievability” of Kyle’s pitch and the way he was able to communicate the vision he was leading Cruise towards.

By Kyle’s own admission, at the time they still hadn’t released their product, but despite that, generated huge value and a sale to a leading corporate player.

Disruptive Coffee

And this all brings me to Disruptive Coffee, at which point you are probably asking if I’m still jet-lagged and/or thinking straight, but yes, it’s all about Disruptive Coffee.

It was Day Two and I was meeting with Sara Thomson (one of the Principals with Maven Ventures who so ably managed and MC’d the event) and she suggested we meet for coffee.

In suggesting we meet at a coffee shop, and being from a region that prides itself on the quality of its coffee, I had to remind Sara that you couldn’t get coffee in San Fran, and that the slightly brown, often tepid, typically bitter, crap that I’d been served on countless previous trips would be hard to describe as “coffee”.  But then Sara reminded me of Philz Coffee and the great brew they served, and so we agreed to meet there.

So, whilst I’ve been before, it’s been more than a few months and hasn’t Philz come on?  In fact, Philz now reflects more than one interesting thing about the Startup Capital of the World.

Even drinking coffee, one of the oldest, most established things we can do, can be disrupted.

Consider Starbucks – a pivot if ever there was one (Starbucks started in 1971 as a vendor of beans and coffee machines) – and the fact that you can walk up to any Starbucks counter in San Fran and get a coffee inside a minute.  Not so Philz though…I went to two (‘cause I missed the one I was supposed to meet Sara at and ended up at the other one on Market!) and the line really is out the door, and in some cases, around the block and up the street.  It takes about 20 mins to get a coffee and the line never dissipates…

Here I am, in the heart of the Startup Universe and the business most obviously killing it is not serving up driverless cars, or sending rockets to Mars or rolling out a hyperloop…it’s making coffee.

What’s the moral?  Even the disruptor can be disrupted and it doesn’t need to be huge, ground-breaking, earth-shattering stuff…it’s just the heart of entrepreneurship; do something different, do it better, find the sweet spot and hammer home your advantage.


Nick Stanley was the co-founder of Sky Software, the leading cloud-based ERP system acquired by Tribal Group in 2014 after launching in 2011; Nick’s third startup and second successful exit after founding his first company in 2003/2004.  He is the Founder of the Geelong startup ecosystem, Runway Geelong, a Limited Partner in Maven Ventures, a startup advocate and now Managing Director of Tribal Group, APAC.  Nick is also an active angel investor with a range of different startups that he mentors, advises, coaches and supports.  He has an interest and 20 years’ experience in EdTech.

Nick Stanley







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