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Ant Bytes — AA22



Web 2.0 pay day


You might remember our coverage in issue 19 (Dec’06/Jan’07) of Australian web entrepreneurs Nick McNaughton and Yorke Hinds, whose slick email marketing application for blogs, Zookoda, was up for sale.
In April, Zookoda was acquired by US marketing company PayPerPost for an undisclosed sum (although McNaughton has confirmed with Anthill that it was an all cash deal).
So how did the deal go down? Well, after some handy coverage in Michael Arrington’s blog TechCrunch (considered the bible for global Web 2.0 activity), McNaughton and Hinds whittled down suitor companies to a shortlist of three – all in the US.
“Yorke and I decided to go and see each one,” says McNaughton.”We covered San Francisco, Denver and New York in four frenetic days. Amazingly, at the end of this week we struck out with all three (for various reasons). As we were heading for the exits in New York, our contact there mentioned that he knew someone who might be interested in us – that’s how we got introduced to Ted Murphy, CEO at PayPerPost. This was the week before Christmas and Yorke was heading to South Africa on vacation. I struck up an email dialogue with Ted and over the following weeks we negotiated a deal. We signed the deal without ever meeting Ted or the team! The first time PayPerPost met anyone from Zookoda was when Yorke arrived in early April to start technology transfer.”
When asked about lessons learnt from the startup and sale process, McNaughton is adamant that the web is the most exciting space for today’s ambitious entrepreneurs. He and Hinds started Quivalent (the parent company of Zookoda) with $50,000.
He offers this advice for budding web entrepreneurs:
  1. Get a prototype built and live as fast as possible. Your product only has value if it solves someone else’s problem or helps them do something better or faster. We got v1 of Zookoda built in four months and tested in two.
  2. Add functionality on-the-fly.
  3. Don’t do free – pick revenue generating apps.
  4. Have a clear idea about your financial goals for the app. If it’s a quick flip, have an idea of who would want to buy it and why before you start to build it.
  5. Have a viral component to your app. (In Zookoda, it was the subscription form that sits on the user’s blog.)
  6. Build relationships with the thought leaders – these individuals are extremely influential in the blogosphere – a good review can make you.
McNaughton is putting the fruits of his education to good use, launching his own venture capital company, Blue Cove Venture (www.bluecoveventures.net), which is backed by a large Japanese VC and will focus on web and software startups. Hinds is in Florida working with PayPerPost on the technology transfer of Zookoda.

Hitwise on target
In the other significant news regarding companies previously covered by Anthill, Hitwise was also acquired in April, by US company Experian, for approximately US$240m. For more details, see page 92. Also, Hitwise founder Adrian Giles muses on his good and bad ideas in My Big Idea (page 22).


“Whosoever desires constant success must change his conduct with the times.”
– Niccolo Machiavelli

Commercial creativity down under and around the globe.

Thriving office?
Have you ever been on the phone while working from home when the doorbell rings, the dog barks or a child starts balling? It might very well be the last time you hear from that client. With more professionals freelancing, remote contracting and telecommuting than ever before, a new offering is sure to keep home-based professionals in the game.
Thriving Office is an audio CDs and MP3 download of busy office background noise. The two 39-minute tracks – “Busy” and “Very Busy” – are filled with the sounds of voices, phones, typing and more. Thriving Office is clearly targeted at mobile workers wanting to leave a more professional impression over the phone, but it has been reported that small offices containing only a few employees are using Thriving Office around the clock in the hope of engendering a large corporate environment that boosts productivity. You can listen to a sample at www.thrivingoffice.com

Social networks, bizarro style
A new web offering from Liesl Capper, founder and former CEO of Australian-based contextual web search engine Mooter, is set to address a seemingly intractable problem for anyone who has large chunks of their life online – namely, being offline. MyCyberTwins are clone humans that live on the internet and have real conversations with people. They work out what people want to know and respond with the most relevant information. A MyCyberTwin talks like its owner, knows what they know and functions on their behalf. The service is aimed at everyone from companies who want to maximise their chance of winning new business by engaging online leads almost instantaneously, to bloggers and online social networkers who simply can’t bear to let a posting to their site go unanswered while they sleep.

Bringing home the bacon
In an effort to save on the cost of freshly minting coins, the Sri Lankan Finance Ministry has appealed to the nation’s children to break open their piggy banks and return old coins to circulation. State-owned banks are offering 20 percent discounts on colour pencils, felt pens, drawing paper and books to children who exchange their savings for bank notes.

Adrian Giles, Hitwise

In this ‘Year of the Idea’, we are asking a series of successful Australian entrepreneurs about big ideas – their best, their worst and the ideas they wished were their own. This issue the spotlight is on Adrian Giles, Founder and Executive director of the global internet ratings and marketing company Hitwise Inc and current president of the Melbourne Chapter of the Entrepreneurs organisation.

What was your best idea?
One of the great challenges that marketers faced in the early days of the internet was how to measure and compare themselves online. The old saying “on the internet, no one knows you’re a dog” in some ways epitomised the feeling for website owners at the time. How significant is my website in my industry? Who are the key players? How does my traffic compare? Back then, the only information available about comparative website activity was gleaned from very small panels using a mirror of the television ratings methodology. It was obvious to us that collecting data on small numbers of people and trying to represent the randomness of activity that occurs online was fraught with error and had a massive scalability problem. How could a small number of people truly represent what millions of people were doing online? The internet was a medium where there are millions of channels (websites) and not just a handful of channels like television. So within that issue we saw an opportunity to develop a ratings system that was able to anonymously collect data on millions of users via relationships with ISPs. By developing technology and systems to effectively measure the “network” we were able to solve the measurement scalability problem and ultimately provide a ratings service for all website owners, not just the top few sites.
What was your worst idea?
When you know you are on a good, unique idea, you want to grow it as quickly as possible. We wanted to expand Hitwise into as many countries as possible before competitors came along. It seemed like the right thing to do at the time, but in practical terms, trying to expand into five countries at once is far too difficult. At one point we had grown into New Zealand, the UK, Hong Kong, Singapore and we were trying to do Japan, South Korea and the USA at the same time. It became a management nightmare and we had to make the very difficult decision to scale back from some key markets where we had started to build strong relationships and had spent considerable time and significant money.
Which idea do you wish was yours?
I wish I’d thought of solar cells. Not only are they going to be one of the key ways we power the planet moving forward, but they also help us combat global warming and our friendly treasurer just gave them a big bonus in this year’s budget.

The business of being green

News Corp cuts carbon
Proving that size doesn’t matter in the race to save the planet, media heavyweight Rupert Murdoch is going green in a bid to neutralise the News Corp carbon footprint by 2010. Murdoch intends to reduce energy use, invest in cleaner technologies and buy carbon credits to neutralise carbon outputs across all News Corp businesses. Underscoring his dedication, he even bought a hybrid car.
“We must transform the way we use energy. This is about changing the DNA of our business,” Murdoch told employees in a global telecast unveiling the plan.
Not content with fixing the problem in his own backyard, Murdoch wants to use his media influence to change the world.
“Our audience’s carbon footprint is 10,000 times bigger than ours. That’s the carbon footprint we want to conquer,” he said.
Planet fashion
The carbon footprint of the mass market is squarely in the sights of the eco-entrepreneurs at Twenty50, named after the expected year of no return for global warming.
Business partners Gideon Birns and Tim Slater formed Twenty50 in 2006 in a bid to send carbon neutrality mainstream. Their first venture is surfware brand Tsunamii, where consumers purchase carbon credits along with their T-shirts. Each item is assigned a level corresponding to a percentage of CO2 produced by the average Australian each year. So, buy a Level 20 item and you have just offset 20 percent of your carbon footprint for the year. Shopping just got a whole lot friendlier.

Reuse, recycle, replenish
From the ‘grey is the new green’ file, we have the AquaReuse filter system. The chemical-free filter system recycles grey water from baths, showers, hand basins, laundry tubs, washing machines, kitchen sinks and dishwashers, translating to a 50 percent saving on household daily water use. The filtered water can be reused for garden irrigation, toilet flushing, car washing, window washing and outdoor hosing.

Asian pollution solution
Think exports to Asia and the Australian mining boom immediately springs to mind. But there’s another export industry emerging, where Australian know-how is applied to Asia’s increasing pollution problem.
Asia’s estimated three million contaminated sites present an opportunity for Australian technology, according to Professor Ravi Naidu, managing director of CRC CARE, the contamination assessment and environmental remediation experts (see issue 21 – Apr/May ’07 – Bull-Ants, “Toil with Soil”).
“Australian companies, regulators and scientists are blazing a trail towards new, cost-effective ways to clean up and prevent this pollution which threatens human and environmental health. There are huge export opportunities for those who get in first with the best technologies,” said Naidu.
To support the industry, CRC CARE plans to set up a nationwide contamination cleanup industry cluster and information exchange, to be known as Australian Contamination CleanUp.

Given the popularity of reality television and, more recently, online video-sharing websites like YouTube, it’s worth pointing out that the utility of everyday video capture extends well beyond the realm of voyeuristic pop culture.
In the not-too-distant future, we might be seeing a lot more of ourselves if security companies adopt this technology as standard issue for their personnel.
Safe-Cam is a digital video camera that is mounted on the security officer’s ear. It captures and transmits live-stream images back to a central data processing unit. Infra-red technology provides a full range of lighting conditions and sound, covering daylight, darkened or night-time environments. The ear-loop is adjustable to each wearer. The device is light-weight and supported with a fitted neck band that allows the wearer to move or run while the camera is active and feeding data into a belt-mounted transmitter. A noise-cancelling microphone has been fitted to filter noise from the local vicinity.
The inventors patented Safe-Cam before taking the concept to Bayly Design, which used its customised in-house prototyping and modeling capability to turn the idea into a reality.
The owners are currently seeking to commercialise Safe-Cam technology, targeting the 180,000 “bouncers” in Australia, similar numbers of police officers and private security guards looking after artworks, events, premises and payrolls. Others who could potentially benefit from this technology are defence personnel, emergency workers, service station operators and other professionals whose lives can be on the line in high-risk settings. One Sydney-based insurance company has already set in place the facility to offer discounts for insurance when this device is in place.
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