Australian top 50 technology companies of 2018

The 2018 Deloitte Technology Fast 50 Australia Awards have led the way through innovation, delivering more than $1.5 billion to the economy, capturing global attention.

The list shows the way companies are disrupting the way we buy insurance, food, cosmetics, mountain bikes and real estate, as well as the way we recruit, hire and promote women in the work place.

The top 3 companies were 

Afterpay topping the list with average revenue growth of 8,134 per cent over the last three years.

Founded by young Sydney entrepreneurs Nick Molnar and Anthony Eisen, Afterpay launched its reverse lay-by model in 2014, changing the way people pay for shopping and exporting the platform to thousands of retailers and millions of customers across the globe.

Mate Communicate was placed second with 3,703 per cent growth, 

Mate is an NBN internet service provider with its ‘backyard’ call centre and community first approach.

and 

Superloop came in third with an increase of 1,860 per cent.

Superloop is an internet service provider offering cutting edge connectivity solutions in Australia, Singapore and Hong Kong. It has built secure, world class networks that telecommunications, media and financial institutions depend on.

Rounding off the top 10 was 

• Vamp (4 - 1,285 per cent); 
• Zip (5 - 1,245 per cent); 
• Swift Networks (6 - 1,211 per cent); 
• Koala (7 - 1,022 per cent); 
• PEXA (8 - 757 per cent); 
• Truck Dealers Australia (9 - 685 per cent) and 
• Megaport (10 - 637 per cent).

Other notable winners included 

• Cevo (14 - 461 per cent); 
• Adactin (16 - 403 per cent); 
• Prospa (20 - 308 per cent) and 
• Araza (28 - 200 per cent), alongside 
• Skyfii (32 - 164 per cent); 
• Idea 11 (36 - 137 per cent); 
• Over the Wire (40 - 127 per cent) and 
• Venn IT Solutions (43 - 114 per cent).

Barhead Solutions was named the 2018 Rising Star.

Delloitte’s Josh Tanchel noted that companies like Afterpay, Zip, Prospa and MoneyMe are genuine success stories for Australia and reminders of how fresh thinking fintechs are fundamentally changing the ways we pay for goods and manage our finances.

He went on to say that a key to their success was a customer focus and a ‘profit for purpose philosophy’.

Interesting Stats 

9 female founders made the list and 25pc of the top 50 companies were listed, 

The top 50 came from the following sectors:-

• 24 per cent fintech (including insurance); 
• 22 per cent software; 
• 20 per cent IT and communications; 
• 18 per cent online; 
• 14 per cent digital agency and 
• 2 per cent medical.

From a State perspective 

• NSW 27
• Victoria 11 
• Queensland 10 and 
• Western Australia (2), 

The next 12 months growth is expected to come from 

• fintech 
• AI development, in 
• 5G telecommunications and 
• implementation of cloud-based business systems

It’s fantastic to see that the collaboration of Universities, Government and Corporates, and the maturity of the Venture Capital community with the support of the major Superannuation fund’s, is providing the opportunities for this amazing innovation to happen, allowing Australia to continue to punch above its weight in this exciting evolution of change . 

Best

Ivan Kaye 

Ps feel free to download my business card https://members.referron.com/bsivc. 

Is consistency key?

19th-century philosophers Ralph Waldo Emerson famously said, 

"Consistency is the hobgoblin of little minds." 

Bezos apparently agrees that consistency is overrated.

Bezos -

 “the smartest people are constantly revising their understanding, reconsidering a problem they thought they'd already solved. They're open to new points of view, new information, new ideas, contradictions, and challenges to their own way of thinking," 

That willingness to consider new information goes hand in hand with a willingness to admit your old way of thinking was flawed. 

In other words, to be super smart you have to change your mind a lot. 

Do you agree? 

Blitzscaling Microsoft, PayPal and Linkedin

Microsoft CEO Satya Nadella and Greylock Partner and LinkedIn co-founder Reid Hoffman share lessons learned from scaling Microsoft, LinkedIn and PayPal.

Blitzscaling is the strategy that leading entrepreneurs have implemented to build strong, enduring companies. The techniques allow for startups and incumbents across any industry to scale at rapid rates and outdistance the competition.

This episode of Greymatter is a discussion from Greylock’s Blitzscaling Dinner with Microsoft CEO Satya Nadella and Greylock partner Reid Hoffman. The two visionaries discuss the importance of consistency when scaling company culture, tactics to push forward new strategies with your board of directors, and steps to mitigate the unintended risks of blitzscaling.

Greylock’s invite-only event hosted CEOs, company founders and top CXOs to discuss the impact of blitzscaling across today’s leading companies and ways that Microsoft is applying these techniques as an established company. Below are key takeaways and quotes from the discussion.

The themes of this episode are covered in Reid Hoffman and co-author Chris Yeh’s new book, Blitzscaling: The Lightning-Fast Path to Building Massively Valuable Companies. 

Blitzscaling Company Culture

Consistency is key to building a great company culture. Building or renewing company culture is not a one time transformation, but a continuous process led by leadership. To set precedence, founders should figure out company values in the beginning and live those values over the lifetime of the company. Over time, employees will know what the company stands for and attract new hires who would naturally fit in with your environment.

There’s not a single meeting at Microsoft that I don’t somehow manage to go to our mission and our culture. And I’ve done it now close to five years. I am so disciplined about it because, that is my unit of scale. The day I stop doing it, the entire motion will fall apart. Consistency was one of the biggest things that you underestimate. You’d keep repeating and you think “God I’ve said this, I should change it a little, make it a little more novel and interesting.’ Don’t.-  Satya Nadella

Blitzscaling With Your Board of Directors

The board of directors will understandably be cautious when you introduce a new blitzscaling strategy which tends to involve some risks. To ease fears and push forward your agenda, founders can implement three techniques: design an evaluation framework that enables the board to track performance, add a board member who believes in the new strategy and can help push forward your effort, and invest in board education. New strategies and new technologies can be difficult to understand. Founders should set up board training sessions to provide further insight and explain why specific risks are worth taking.

One of the things that at least I’ve realized is what’s the framework for (the board of directors) to evaluate me and my management team on the judgment we’re passing. And there quite honestly this is where being transparent, being super intellectually honest is the most helpful thing in high risk businesses like ours. I’ve learned the most important thing is- don’t think that they’re passing judgment on the strategy, they’re passing judgment on your judgment of strategy.-  Satya Nadella

There are also two other techniques. One is, a board has a number of people, add someone who’s the catalyst to the board. Have that be an explicit conversation with them about, “Look, I think this needs to be going this way, do you buy in?” And then in some cases, I think one of the things that’s very useful to do is to really invest in some board education. They need to understand this. And say, “Look, in order to do this, we need to set up a one day, two day training thing and you need to come for it in order to do it”, and that’s a big cost and a big play. But sometimes that’s the only thing that actually works. — Reid Hoffman

Responsible Blitzscaling

Unintended consequences can happen as organizations rapidly scale. It’s the founder’s ethical responsibility to consider the negative impacts each decision may have the company or product has on customers and society. To maintain safety of customers, founder should have build in processes early on that are meant to mitigate unintended consequences. To enhance company trust, founders should implement safety and ethical regulations that are agile to allow for innovation over time.

I’ve come to realize is, day one, while you’re building that product or service that obviously needs all the scale, you would be better served to construct even in its core business model and in the unit of scale, a way to deal with the unintended consequence. So the more you have thought through what are the unintended consequences that you will be unleashed when you are at scale day one. — Satya Nadella

There’s a way to propose a lightweight set of regulatory frameworks that enhance trust, still create the maneuverability for innovation, and aren’t trying to just do what people classically think of companies. — Reid Hoffman

---

In 2016, Reid and Chris stress-tested the ideas of in blitzscaling by teaching the class CS183C: Technology-enabled Blitzscaling at Stanford University with the help of their friends (and fellow Stanford alumni) Allen Blue and John Lilly. To learn even more about the strategy behind blitzscaling from guests including Airbnb CEO Brian Chesky, Netflix CEO Reed Hastings, Gixo CEO Selina Tobaccowala and many more, you can check out the recordings from the class here.

The future of E’learning

The future of eLearning is surely bright. Here are 6 sensational eLearning trends.

1. Mobile Learning

Mobile learning, also known as mLearning, is not simply eLearning on a mobile device. The eLearning content for mLearning is precisely created for mobile devices. This transformation demands skillful Instructional Design that is compatible with mobile devices. Increasing eLearning trends have made companies to launch Learning Management Systems (LMS) which are operational over multiple platforms. Companies want their employees to have the luxury of retrieving training materials and resources from any device, at any time and any place. Hence, increasing trend of mLearning has revolutionized learners’ experiences. It is not necessary to sit in front of a PC to access trainings. Future eLearning will always be “on the go”.

2. Gamification in Learning

Gamification is not a latest industry trend but it is an ever-evolving one. It is not just restricted to kids but it equally engages adults and facilities learning process as a whole. Gamification has become a handy addition in eLearning. It not only challenges learners’ abilities, but it pitches learners against each other in a positive manner; reinforcing them to polish their skills and learning harder. Gamification also provides the luxury of adding various levels in learning. Learners have to start from basic level. Virtual scenarios make learning faster and more engaging. More and more organizations have started implementing gamification in their eLearning.

3. Micro-learning

In a fast paced corporate culture, micro-learning is fastest of the learning trends. Micro-learning involves mini-bytes of learning content made available to the learner. This content might include 5-10 minutes videos, single page documents, focused articles, specific and small chunks of lessons. The main objective of micro-learning is not to burden the learner with too much reading and to provide him with small chunks of learning in his daily busy schedule.

4. Competency-Based Learning

Popularity of competency-based learning has risen in the corporate sector. It is a rising trend because it enables employees to get insights of their own skills, strengths and weaknesses. It lets them identify the areas of improvement. Knowing more about their weaknesses they can decide how to pace their learning, which skills to follow and which areas to work on more.

5. Cloud-Based eLearning Systems

Cloud-based eLearning systems are young but gaining ground steadily. The latest trend has seen Learning Management Systems and authoring tools switch to cloud-based platforms. It not only gives mobility but reduces the training costs significantly. It is also easy to introduce new product and features on cloud-based systems and authoring tools.

6. Wearable Technology Training

With the advent of wearable gadgets like Google Glass, Apple Watch, and Oculus Rift – trend of virtual reality in eLearning has seen an immense rise in such a short period of time. These wearable devices help learners to interact with eLearning content in a more dynamic way. They make eLearning more engaging and interactive. Use of 3D simulations and virtual scenarios make Virtual Reality more appealing for eLearning industry.

Life is filled with a series of moments

If you are alive - Your heart rate is not a flat line it is filled with a series of highs and lows..... of 

• High peaks and summits 
• Love and loss
• Ups and downs 
• Twists and turns 
• Successes and failures 
• Happiness and sadness
• Boredom and excitement 
• High peaks and summits 
• Pleasure and pain
• Sunshine and rain
• Loss and gain 
• Laughter and crying

If your life is a flat line - you might as well be dead!

What do you think? 

The latest in the R&D Tax Incentive

Recent months have seen a lot of media coverage regarding the future of the R&D Tax Incentive programme, and how it is enforced and administered.  With changes to the program under consideration by the Senate, a newly published AAT case, and some recent updates to compliance information from AusIndustry, now is a good time to look closely at your R&D tax claim processes to ensure all relevant legislative requirements are met.  As always, if you have any questions regarding the operation of the Incentive (or any other grant programmes) and how these issues impact your business, please get in touch with one of our R&D team in our Sydney office on (02) 9126 9100.

R&D Amendments Referred to Senate Economics Legislation Committee

The Treasury Laws Amendment (Making Sure Multinationals Pay Their Fair Share of Tax in Australia and Other Measures) Bill 2018 (https://bit.ly/2CosRc0) was referred to the Senate Economics Legislation Committee was for inquiry and report by 3 December 2018. The Bill was introduced to the House of Representatives on 20 September 2018.

BSI previously submitted a response to the Treasury consultation on the Government’s 2018-19 Budget Measure - Better targeting the Research and Development Tax Incentive, citing concern that the (then) proposed measures would have negative impacts on the level of business expenditure on R&D.

Our sentiments were reiterated in a further submission to the Committee (available for viewing here) lodged last Monday, 5 November 2018. Given recent events in Canberra and the emergence of a minority Government, in is not yet clear whether this legislation will pass both House of Parliament before the next federal election.

Administrative Appeals Tribunal (AAT) – Moreton Resources Case Update

On 9 October 2018, Moreton Resources Limited lodged an appeal to Federal Court of Australia in relation to the negative decision from the AAT made in September 2018 (https://bit.ly/2Ne0ILo). The decision affirmed an internal review decision of Innovation and Science Australia (ISA) that R&D activities claimed by Moreton Resources were not eligible under the R&D Tax Incentive Programme.

The AAT was of the view that, although the development of a pilot Underground Coal Gasification (UCG) plant in a unique geographical area was an experimental activity, the pilot UCG project used known technology and, at the time the activities were undertaken, they were not conducted for the purpose of generating new knowledge. The AAT held that this view was supported by the representations of the project made by Moreton Resources in their internal (contemporaneous) documentation and communications with third parties.

Other activities were found to be non-experimental in nature or conducted to comply with Government regulations and therefore ineligible.

Crucially, the AAT’s Decision states at 204 ‘The evidence must point to the experimental activities having the relevant purpose at the time that the activities were undertaken.’ Subject to outcomes of the appeal, this reinforces the requirement for companies to properly document their activities. The Decision advances a view that the purpose of an activity is a matter of fact, and claims are not to be made on the basis of retrospective reconstruction.

​Changes to the R&D Tax Incentive Integrity Process

Earlier this year the Department of Industry, Innovation and Science implemented changes to its compliance process in an effort to reduce the compliance burden for companies chosen for review and to improve the speed of this process.

The major change is that a company, upon a request for information (RFI) from AusIndustry, will have 30 days to provide evidence. A further 14-day period may be granted in certain circumstances. A fact sheet detailing the changes has been provided (https://bit.ly/2zjPcEH) detailing this change and reiterating other key information, being:

Claimants are responsible for making sure they meet the eligibility criteria for the program;

• Registration of R&D activities alone does not mean that these activities are eligible;
• To be eligible for this program, activities must be supported by records kept during the time a company conducted their R&D (known as contemporaneous records); and,
• The examination of a company’s registration may lead to a Finding about the eligibility of all or some of the registered activities. The company’s tax return may need to be amended if any of the registered activities are found to be ineligible.

​Reminder about Record Keeping

According to the ‘Record-Keeping and R&D Planning’ fact-sheet produced by AusIndustry (https://bit.ly/2RVOlCx) , a key requirement of the programme is that companies must keep adequate records to demonstrate to both AusIndustry and the ATO that:

• They carried out eligible research and development activities (i.e. core R&D activities and supporting R&D activities);
• They incurred eligible expenditure in relation to those activities; and,
• Their R&D activities and expenditure met all other legislative requirements under the program.

Relevant records include those normally maintained to support income tax claims as well as those that cover the planning and progress of R&D activities. The records kept by individual claimants will vary depending on the nature of their business and their R&D activities.

We recommend that companies periodically review their record-keeping processes (with reference to the fact-sheet) to ensure that all R&D activities and associated expenditures can be appropriately supported.

If you have any concerns about your internal R&D documentation or record-keeping processes please contact BSI at any time.

Timing Issues for Prospective Grants

Beyond the R&D Tax Incentive, there are a wide range of competitive, prospective grants available to companies looking to develop or commercialise innovative technologies, goods and services. Some of the most notable (and valuable) are Accelerating Commercialisation grants, CRC-Projects grants, Industry Growth Centres, ARENA and ARC Linkage Projects.

Grant funding applications typically require a higher level of supporting documentation, and may involve long lead times (3-4 months+) before an award decision is made. For this reason, upcoming State and Federal elections create a risk that some programmes will be placed on hold, or even closed, where there is a change of government. If you are currently considering available grant opportunities, please contact us to discuss the best approach to preparing applications in this environment.

The ownerless company of tomorrow

The Bob Pritchard Column

Everyone from small startups to major corporations are jumping on blockchain. In addition to transforming areas like data and payments, blockchain is shaking up traditional corporate structures. 

Through blockchain, companies can fundraise without stocks, operate without bank accounts, and pay employees without even knowing their names.  Soon we will be able to create a completely ownerless company.

 

 

Today, startups should incorporate with taxes and stock options in mind. However, Blockchain companies, to build a community, only need an internet connection and a good regulatory environment. 

 They’re open source groups that manage internal funds in straight crypto currency and don’t need traditional bank accounts. Ethereum, for example, raised funds through a public crowdsale, backs a free-floating token, and operates the Ethereum Foundation as a Swiss non-profit corporation. 

This means most of its value comes from sources that operate outside the legal bounds of traditional corporate structure.

 

Tomorrow’s companies might look more like a trust, which has no owner and simply uses a special legal system and denominates everything in their native token.

Checking in at a centralized office is increasingly an outdated concept and Blockchain developers are spread out, often fully anonymous, even the team members don’t know who other team members are. There’s one called Mimblewimble where the developers use Harry Potter characters as names.

 

Many major projects have employees spread across the world, or are headquartered in regulation-friendly financial zones like Switzerland or Singapore. Anonymity can be especially desirable for employees located in more strictly regulated locations.

 Norms like decision-making based on seniority and other internal politics will not necessarily be intuitive. New rules may have to be written into companies’ software, rather than ingrained in their culture.

 

Blockchain companies are developing solutions to help “open organizations” codify their voting, politics, and employee rewards.Helium is pioneering a hardware device that could effectively kickstart a decentralized telecom, bypassing the need for capital-intensive mobile towers. Future crypto networks could crowdsource purchases of machines, real estate, labor, and more.

 

In the near future, blockchain companies may even challenge today’s big tech incumbents. With the ability to leverage dispersed workforces, distributed computing hardware, and new revenue streams, ownerless companies may soon offer competitive services at bargain prices. 

 

A robot walks into a bar and orders a drink.  

Bartender says, “Hey, we don’t serve robots.
And the robot says, “Oh, but someday you will.”