Finding start-up venture capital in Australia - the needle in the Haystack
Announcement posted by Haystack 17 Oct 2014
Under embargo until Tuesday, 21 October, 2014
Finally, after two-years of solid networking, Haystack CEO Ran Heimann entered the office of a big-time Venture Capitalist high up in Manhattan’s Trump Tower to pitch his new mobile app.
Precisely four minutes later, he was back in the elevator, his hopes plummeting as fast as the floor numbers as he made his descent.
“In hindsight, it was probably the best thing that could have happened for Haystack,” said Mr Heimann.
“I came back to Australia, re-focussed our objectives, and here we are just six months later launching the Haystack app locally, without having taken any major hits on our company ownership.”
Co-founded by Mr Heimann, a business consultant, and his two brothers Matan and Nir (both from a software background), Haystack promises business cards, without the paper. It stores and automatically updates the business cards you receive, and lets you share your own business card directly from your phone.
Early on in the Haystack journey, Mr Heimann said he quickly realised that Brisbane is not a hot bed of Venture Capital, and neither is Sydney or Melbourne.
“In the two years I spent knocking on the doors of Venture Capital firms I met lots of wealthy investors, plenty of whom seemed genuinely interested in what we were doing with Haystack, but the response was always the same: ‘Nice idea – come back when you’ve built it’,” he said.
“My experience with the VC market in Australia was that it’s mainly smoke and mirrors.
“In the end, it was my personal business network – contacts made through my 10 years of experience in corporate Australia – that turned up my first investor, who happened to be my old boss.”
The subsequent cash injection helped fund the development of a prototype of the Haystack app, which Mr Heimann said was key to attracting further investors.
“The prototype was essentially a concept app that operated the same as what the real Haystack app does now, but without all the security and beautiful user interface.
“We showed the prototype to people within our own network and they decided to invest on the spot.
“Before we knew it we had eight investors who liked the technology, believed in our team and although they knew the high risk profile, were still keen to be part of the Haystack ride.
“I like to call them our Adventure Capitalists.”
Mr Heimann said his advice to other technology entrepreneurs is to stick with your own network, develop your idea and fund it in small increments.
“We never did get money from a Venture Capital firm, but that’s probably a good thing in the end because chances are we would own a lot less of Haystack and be dealing with a lot more interference.
“If you have a good idea and a good team – Adventure Capital will find its way to you,” said Mr Heimann.
Precisely four minutes later, he was back in the elevator, his hopes plummeting as fast as the floor numbers as he made his descent.
“In hindsight, it was probably the best thing that could have happened for Haystack,” said Mr Heimann.
“I came back to Australia, re-focussed our objectives, and here we are just six months later launching the Haystack app locally, without having taken any major hits on our company ownership.”
Co-founded by Mr Heimann, a business consultant, and his two brothers Matan and Nir (both from a software background), Haystack promises business cards, without the paper. It stores and automatically updates the business cards you receive, and lets you share your own business card directly from your phone.
Early on in the Haystack journey, Mr Heimann said he quickly realised that Brisbane is not a hot bed of Venture Capital, and neither is Sydney or Melbourne.
“In the two years I spent knocking on the doors of Venture Capital firms I met lots of wealthy investors, plenty of whom seemed genuinely interested in what we were doing with Haystack, but the response was always the same: ‘Nice idea – come back when you’ve built it’,” he said.
“My experience with the VC market in Australia was that it’s mainly smoke and mirrors.
“In the end, it was my personal business network – contacts made through my 10 years of experience in corporate Australia – that turned up my first investor, who happened to be my old boss.”
The subsequent cash injection helped fund the development of a prototype of the Haystack app, which Mr Heimann said was key to attracting further investors.
“The prototype was essentially a concept app that operated the same as what the real Haystack app does now, but without all the security and beautiful user interface.
“We showed the prototype to people within our own network and they decided to invest on the spot.
“Before we knew it we had eight investors who liked the technology, believed in our team and although they knew the high risk profile, were still keen to be part of the Haystack ride.
“I like to call them our Adventure Capitalists.”
Mr Heimann said his advice to other technology entrepreneurs is to stick with your own network, develop your idea and fund it in small increments.
“We never did get money from a Venture Capital firm, but that’s probably a good thing in the end because chances are we would own a lot less of Haystack and be dealing with a lot more interference.
“If you have a good idea and a good team – Adventure Capital will find its way to you,” said Mr Heimann.