Capitalising on virtual and reality


Who would’ve thought that the term Holographic Virtual Reality (TM) was still there to be taken by 8i?

Equally (except we’re sort of now used to it), who would’ve thought four non-New Zealanders, who together form 8I, and who now call Wellington home, would have come together to help build the improved visual engine to power the Oculus Rift virtual reality head-mounted display.

The Oculus was initially funded through Kickstarter in 2012, and in March Facebook stumped up with $400m in cash plus $1.6bn in Facebook stock to buy the company who aims to puts the head-mounted display’s price within the reach of gamers (among other things).

Making the display, but more importantly the background code that enables the holographicness is therefore a big, complicated, maths-heavy, piece of work. The May 5 announcement on the 3D leap forward is notable.

The four person co-founder team that’s more or less self-assembled is top shelf stuff.

Australian-born Linc Gasking started and sold out of a highly success San Francisco net-based startup.

He’s recently written a self-funded study and report on “Five ways New Zealand can accelerate a sustainable high-tech ecosytem”, is a co-founder of Free Range Farms, a space, place and pace for startups, and also of Chalkle, a community based learning/teaching platform.

Joshua Feast, is a Kiwi, who has been based in Boston for a while involved in tech ventures.

Sebastian Marino, the Chief Creative Officer brings some serious applied maths and visual effects grunt to the team. He won a 1999 Academy Award for his work on virtual clothing in a Star Wars movie, and provided much of the algorithms and computation behind 77 Pieces – a 2D to 3D modelling tool that allows shows what a flat patterned piece of cut out cloth will look like as part of a pair of jeans (for example).

I’ve not met Chief Scientist Eugene d’Eon, but Mr Google reveals a Lord of the Rings involvement as well as numerous (solo and shared) publications in computer science journals with names such as ‘A layered, heterogeneous relfectance model for acquiring and rendering human skin’.

We’re very lucky these guys have chosen to base themselves here. They could set up wherever they please, so whatever secret-ether Wellington’s emitting to attract and retain this sort of talent should be bottled.

They’ll be calling on the home-grown and imported talent pool to help develop the next iteration of the Oculus Rift, and deliver a consumer product.

As Linc Gasking said in the press release, 8i is acquiring deep technology from Oculus. But equally, 8i it is also adding its own expertise, boosted to by the team it is building….people who among other work gigs have been immersed in building the 3D Avatar movie.

Oculus, and in turn Facebook don’t just choose any old random to do this sort of work.

Keep an eye on these guys as they capitalise on a time, place and collective brains sychronocity and synergy.

If we do this right, and not put the word innovation anywhere near 8i, Wellington and New Zealand could create a commercial 3D nucleus as the company scales the opportunity to make Holographic Virtual Reality the real deal.

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Entrepreneurial success means starting at the end


Start at the end and work backwards.

This was the ultimate, underlying piece of advice from Laura Humphreys, who has started and successfully exited two businesses in Wellington, and now among other things is relaunching herself as a business author and mentor under the Liber8me label.

Speaking to Wellington’s Entrepreneurs Club, Humphreys described how she worked her way up the advertising copywriter ladder in London, Singapore and then Wellington.

Having an “early mid-life crisis” in her late 20s, she studied other peoples’ success, (including a stint of following Robert Kiyosaki of ‘Rich Dad, Poor Dad’ fame, as he lectured around the world), she decided to create her own advertising agency.

Red Rocks, as she’d planned, was very successful, and she sold it to a multinational nine years later. One advantage was being the only woman CEO in an industry that then was dominated by male bosses (and egos!).

Her next venture was Pet Angels – a brokerage, with end to end automation between pet owners, pet carers and the whole booking, billing and payment system. It grew to having 150 angels across New Zealand, and that was sold to a competitor (as planned) two years ago.

I’ve followed the formula in a business plan. Start at the end and work backwards,” says Laura.

Approach what you’re doing as building an asset, something that can provide you with financial freedom.”

She broke the formula down to the following steps.

  1. Start with the exit in mind (think about who might want to buy it).

  2. Set your end goal(s) (how much do you want to sell it for)

  3. Paint your end picture (what are you selling, what is your model)

  4. Plan backwards with milestones (this is a map, concentrate on the first 12-18 months, then review)

  5. Plan your first and next milestone

You’ve got to think like a big dog, about what is possible, about being a big organisation from the start,” she says.

Laura a big fan of using an advisory board – and early on in her Red Rock business brought on two directors. Even though they were comparatively costly, the fact of having to monthly report to them was a hugely important discipline.

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Lightning Lab grows up, gets into its groove


The Lightning Lab’s demo day had some quite fascinating works in progress…bring on Demo (to investors) Day on May 28 at Te Papa.

The team behind LL are also, as you’d hope, a year wiser, further along a path with the aim of rapidly ramping up verified/proven businesses.

It also isn’t surprising to see the LL accelerator (now there’s a nice rhyme/assonance) expanding to Auckland next year and Christchurch.

The nine, mostly two or three man teams (and a question asked why so few females?), have had assumptions challenged, hard questions posed – as teams are forced to think about building a business as opposed to creating a product.

There is also wider value beyond the incubation itself, as Ken Erskine, director of startups at The Icehouse, (as appears in Stuff), puts it perfectly

He says research showed successful startup accelerators provided a network of highly experienced and committed mentors and investors, an active alumni network and, most importanly, connections to future capital.

Together, we have a phenomenal combined network of mentors, investors and startup entrepreneurs to help ensure the success of the nationwide accelerator programme.”

At the demo, with a small d, day on April 23, one of the three month intensive’s more interesting pivots was the horse guy.

The original pitch was to do something to make horse shoeing more easy. But the team lead by Ashok is now looking to create a tool so that businesses can run campaigns on SnapChat (the instant appear/disappear photo app).

The guys looking to build a tool to automate translating accounting figures from say Xero, MYOB or QuickBooks to an accountant’s own chart of accounts has already got strong traction and demand.

One of the startups wants to capture, retain and effectively distribute that deep institutional knowledge longertime employees have about a company and how it works.

There’s an app to help the hospitality industry manage its staff/flow requirements, and software for managing shared expenses – as in flatmate situations. An easy, no-bugs way to get a web design quickly going live and updateable, a water tank monitor device, management software for sports coaches, and an app that uses social networks as a way to connect offline – say a quick game of tennis – were explained, and a brief lessons learned given by all.

Finally, and this will be interesting to see if they can get it right – a map that shows where you’ve been on web searches – a way of collecting notes and creating shortcuts through the world’s knowledge.

So, obviously no shortage of ideas up for grabs.

But, as we all know, ideas are easy – it is getting them to sustain flight that’s the trick.

And, an interesting final note:- LL is a partnership between founding investor partners (who receive a percentage share of any startup’s initial offer) and MBIE, part of its accelerator funding pool.

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The Kiwi innovation space is starting to look awfully crowded


Is it just me, or is the innovation/commercialisation space looking awfully crowded and confused these days?

Sure, we like to think we’re (NZ Inc) inventive and entrepreneurial.

But there seem to be more entities out there offering innovation (and I shudder to use the term) advice, funding and connections than there are companies with good ideas.

Wearing my taxpayer’s hat, I have no problem when private money puts their proverbial on the line and takes a punt on a startup or early stage company being the next big market success.

Therefore the angel investor community, private equity companies and even family, friends and fools are to be admired and encouraged.

But the plethora of government, university and regionally financed organisations servicing our entrepreneurs is started to look very overlapping, rather uncoordinated; and the lack of transactions by some players needs to be questioned.

A cursory list includes (I’m not sure if I should apologise for accidentally missing some!):

NZVIF

Callaghan Innovation

MBIE (well, parts of it)

KiwiNet (and the individual university commercialisation units that are part of it)

Icehouse

SODA

BBC

CreativeHQ

powerHouse

Sparkbox

In fact this blog was inspired by the recent announcement that there is to be a merger between Wellington-based Kerasi Ltd, and powerHouse – though Kerasi’s website states it is a powerHouse partner so decide for yourself who the kingpin.

powerHouse has also recently announced a merger with Dunedin incubator Upstart.

Then there’s a new body I’d never heard of – Innovation Council NZ.

Again, one of its main sponsors is government via Callaghan Innovation.

All in all, I’m afraid it means that there is quite a bit of overhead costs to be paid for by someone (us) as all and sundry scramble around looking for something to invest in.

In other words, there’s lots of pedaling by a lot of people, but without the sense of urgency that having your own money invested brings to the game.

There will be a lot of meetings though, and any number of bureaucratic hoops to jump through to make sure that ‘value’ is being delivered to the taxpayer.

And then, by the time that someone higher up that government food chain ponders the question of whether flinging a whole lot of money at innovation, and seeing what sticks, actually does work, it’ll be time for another change of policy.

But by then minister of everything Steven Joyce will probably have ditched the science and innovation part of his portfolio!

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Re-arranging science funding’s deck chairs


Well, I guess you can’t have too many science funding bodies…

An alert colleague pointed out a GETS call for applications for – Capability in Independent Research Organisations Funding. (GETS Reference: 41196)

This fund is aimed at non-Crown Research Institutes,

“which hold significant research capabilities supporting national outcomes in areas of government priority.”

This will appeal to organisations such as the Cawthron Institute, HERA (Heavy Engineering Research Association), Opus Research and other independent researchers. (You can see a full list here at IRANZ, the Independent Research Associations of NZ).

The major surprise is that this fund is to be administered by the Health Research Council (HRC).

In a way it all makes perfectly logical sense given the way that science, innovation and commercialisation ‘policy’ (used in the very loosest terminology) has gone over the past few years

We had science policy and funding being separated – a Ministry and a Foundation for R,S & T.

Then these two were brought together to have a Ministry of Science and Innovation.

That lasted about five minutes, and MBIE was set up, with much of its funding allocation removed when Callaghan Innovation came, and is coming into, being.

Oh, there’s also the Primary Research Growth Partnership administered by the Ministry of Primary Industry as another entity entirely.

And now this.

The HRC does make funding allocations to researchers in health – which presumably they have a fair degree of expertise to do so.

Now they’ve got to become experts in a wide range of research fields, completely unrelated to their core knowledge.

Instead of the fund being under MBIE, and aligned to its overarching goals which seeing as it helped write them it should understand, a completely different body gets to do the choosing.

I guess, when as a country, we have no clear idea of what we should be concentrating our limited scientific endeavours on, then spreading the resource ever more thinly and hoping something, anything, serendipitously happens to happen is as good as any other approach.

But it takes us ever further away from the exemplar countries such as Denmark and Singapore – countries that have a plan, stick to it for a bit, and then modify what they do to achieve the clear goals that they have.

Talk about re-arranging the deck chairs!

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‘Fire engine envy’ + time = sales


Fire engine envy.

No, I never knew that such a condition existed, though it kinda makes sense if you happen to be involved in the fire fighting business.

But fire engine envy is one of many factors that’s assisted Lower Hutt’s Fraser Engineering into a pre-eminent position as an Australasian manufacturer of such tenders.

Speaking at a recent gathering of Technology Valley participants (and totally coincidentally, held at Petone’s Fireman’s Arms pub), Fraser’s general manager Martin Simpson told of how firemen looking enviously at the units put together by his own company, make comments that gradually and ever so slowly filter up to positively influence decisions made by a purchasing officer.

Fraser’s manufacture virtually everything in a fire engine tender beyond an imported truck chassis and cab (though they’re thinking about building this as well).

It starts with feedback and input from real firemen.

Hosereels, pumps, valves, nozzles, cabinents and the whole kit and caboddle are designed from scratch, from single components up, on a SolidWorks 3D CAD software platform.

Most of them are then created through the use of more than $20 million of manufacturing equipment, including an increasing amount of 3D (additive) metal and other products printing.

The demands of fire fighters are an important element in designing extremely robust equipment.

“A fireman’s pumped with adrenalin when they’re in action,” says Martin.

“They don’t want to be grabbing something in the heat of the moment…and it breaks. Likewise, a pump must start first time, every time.”

Another aspect of firemen psychology is that, during some of their downtime (mostly they’re not fighting fires), they’ll often surf the net, checking out tools of their trade. (You can imagine that this sort of exercise would certainly contriubte to fire engine envy!)

Martin says that unlike some of their competitors’ fire engines, all Frasers’ vehicles are immediately able to go into service (commissioning is relatively easy). The company also concentrates on the “whole of life cost” of the tenders, noting that Fraser’s has virtually zero warranty issues. In other words, the fire engines work first time, for a long time.

It is information and feedback such as this that slowly filters through the fire services of different states and countries – helping to build Fraser’s reputation.

Martin says Fraser’s is helping to organise a major fire fighting conference to take place in Wellington in September 2014, which may be attended by up to 2000 people.

“If there’s any other fire fighting related companies who would like to attend this event that will have every purchasing officer from Australia and New Zealand there, as well as a swag from other countries, we’ve love to hear from them,” he says.

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Fraser Engineering; a billion dollar company in the making


Well, you can’t accuse Hutt Valley-based Fraser Engineering of lacking ambition.

Speaking at a recent Technology Valley get-together, general manager Martin Simpson says it wants to be a billion dollar company.

The 60 year old private company with 100 designers, engineers and fabrication and production specialists has tweaked what it makes a number of times over the years – with its latest incarnation having manufacture of fully-specified fire engines as one of its major product lines.

Fraser’s are now the largest fire engine manufacturer in the Pacific area, and one of the largest in the world.  All of this has been achieved by ploughing profits back into the business, and NOT outsourcing to the likes of China.  It means that the company has more than $20 million of manufacturing ‘kit’, from 3D laser printers, to laser cutters, 9-axis machine tools to powder-coating facilities.

However, all this machinery starts and interacts with a Solidworks 3D CAD design software. (Martin noted that there’s a very large bill that the company has to pay for licence fees for this capability as one of the largest privately-owned users in New Zealand).

As a result Fraser’s are able to barcode-view the manufacture of every single part of the appliance, control valves, nozzles, hose reels and host of other components that make up a fire engine (or any other job it does for outside clients). From materials to drawings, purchasing and all aspects of turning raw metal into often very complex finished components, Fraser’s can track the process and progress of any individual part.

Should a replacement part be required, Fraser’s can find its specifications virtually instantly, and be able to produce it on the spot if required.

By maintaining a design-led in-house manufacturing and engineering capacity, “we’re now a powerhouse that can compete with anyone in Australasia,” Martin says.

“In fact, we’re advancing our manufacturing capability so quickly, our opposition can’t keep up.”

This in-house expertise also means that Fraser’s know to a few cents, how much an item costs to manufacture. Detailed information and internal reporting such as this is one reason that Fraser’s is now building 20-30 fire engines at any one time.

The company also has an intellectual property strategy that isn’t based on patents.

“The way we do it is to keep ahead of the competition,” says Martin. “If you copy you will never lead.”

Martin is also dubious (to say the least) about some of the ‘advice’ received over the years from government ministries.

Fraser’s deliberately didn’t outsource parts of its manufacturing to China. An observation he’s made of other engineering companies who have done so, is the waiting and co-ordination required to make sure hundreds of parts arrive on-time to create the component. This wait, and just as important the resultant delay in getting paid by your own customers is part of the reason the company has been so insistent on being a one-stop-shop, and/or outsourcing some manufacturing elements  to local collaborative partners.

Control of the process is key.

“Don’t sell your assets,” was one of Martin’s take-home points. “It keeps you in control.”

He says an exemplar company for Fraser’s is Rosenbauer.

They are often asked (with incentives) whether they would also like to establish themselves over the ditch.  In the meantime though growth will come through being smarter than their opposition.

That, and no doubt, a large degree of listening to themselves and not to others who don’t have skin in the game.

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A trial with zero percent success proves trap’s worth


 Any business that gets itself into a financial position to employ others is, by default, doing OK.

If that operation starts with a completely new product, to survive long enough to (at least) thrive, is even better.

So it is great to hear of pest and predator control company Goodnature coming up trumps in an extensive DOC test in a two-year project at two trial sites at Boundary Stream Mainland Island, Hawkes Bay, and Onepu, Northern Te Urewera.

We’ve set a whole new standard for rat control with traps,” says Goodnature head of marketing and market development Stu Barr.

For us and DOC the trial results are exceptional and beyond the expectations set at the start of the project.

To put it in perspective, the pass mark for the trial was 5%. To get 0% at both trial sites has set a whole new standard for future developments. At 0% all the rats are gone and therefore all bird and native species vulnerable to rat predation are going to thrive and grow in numbers.”

This is a level of control previously only achieved by toxins.

Goodnature’s A24 automatic humane kill-traps for rats and stoats resets itself up to 24 times powered by a 16 gram compressed CO2 canister. A bolt to the animal’s head results in an instant kill.

The Goodnature A24 rat and stoat trap

And while the innovative design of the traps (which, in a larger version also kill possums) was part of the design team’s approach, over time the Wellington company’s found much of its ongoing research and development aimed at perfecting longlife lures to attract the pest to its death.

Stu Barr says the constant trap and lure improvement were vividly seen when the 2013 technology version traps were deployed in 2013.

The humane killing technology, along with pest-specific lures, is now being use in more than 15 countries around the world.

As well as further rat control, Goodnature’s automatic resetting traps are helping eliminate the introduced mongoose in Hawaii, and mink in Scandinavia.

All of this hasn’t happened overnight of course.

Goodnature, founded by three mature design students, started in 2006.

But there’s now eight people onboard – and you can only be an employer if you’re making money.

The constant trap and lure improvement is part of the company’s design philosophy.

The trial alongside DOC, and more importantly the 100% kill statistics all help Goodnature position itself as a viable est control method beyond poisons.

Undoubtedly too when Goodnature started, they considered themselves in the pest killing business. Over time they’ve found themselves just as much in the pest-attraction business – as the ‘kill’ part of the trap itself is increasingly honed to perfection.

It is this eye for constant improvement that is helping the company grow.

Good luck guys, keep up the good work.

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How long will it take for the Wynyard Precinct to hit its straps?


Well, let’s see how Auckland’s new Innovation Precinct, Wynyard Precinct (it appears to have at least a couple of names) get’s up and going.

It has been one of those long time in coming projects – and now we’ll see if the deliberate talk of setting up an innovation hub to attempt to be a baby Silicon Valley can be pulled off.

Making it a digital and ICT concentration of goodness may work, but then it may not.

I don’t know enough of the psychology, come physical location, come proximinity to university relationships to guage this one yet.

That, and whether the office/laboratory rent will be in the right comfort zone for budding entrepreneurs, who, even though they’d like to be situated around other smart people, may prefer the rock-bottom payments due when operating out of garage.

With (well at least according to this NZ Herald story) hotbeds of innovation already taking place in Albany, Takapuna, Henderson, Parnell, East Tamaki and further south around Auckland Airport, how and where Wynyard fits in will be interesting over the next few years.

Wynyard’s got some solid operators, with a track record in start-ups through having The Icehouse and Auckland’s BizDojo as people to meet, greet and settle potential new firms. There’s nothing like a bit of experience and competence to help fledgling founders.

How Ateed (the Auckland development agency) and Callaghan Innovation bring the FoodBowl into the mix will be another challenge.

The Manukau-based Food Innovation Centre has had considerable investment put into it by central government.

While these ventures always take a long time (if ever) to pay themselves back, the FoodBowl’s been very much in that territory apparently.

But, that’s not to belittle Wynyard. Onwards, and hopefully upwards.

Mind you, given that it will take at least a couple of years for anything meaningful to happen, by then we’ll have forgotten what the original purpose of Wynyard was anyway.

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Driver of Callaghan accelerator services to put pedal to the metal?


We’ll make the assumption that Callaghan Innovation’s new GM of Accelerator Services isn’t there for the money.

Chris Somogyi’s come relatively unannounced to the crown entity whose role is to accelerate the commercialisation of innovation by NZ firms.

Chris Somogyi

Softly, softly is possibly how the American, recently from Seattle may do things – lie low, get a feeling for the place before making yourself known.

He’s been a venture capitalist, developed concepts into ready-made products and has a strong record in business development. He’s already been to NZ a number of times, so presumably isn’t too rose-tinted glasses about our place.

Given his interesting credentials, and presumably backstory as a biomedical engineer by training, Somogyi hopefully brings some deep connections and contacts into some of the business areas CI’s targeting.

Having been well over a year in the development, CI needs a few runs on the board, needs the accelerator pressed to the floor.

Investing in companies, having an umbrella view of industries and sectors will undoubtedly be a completely different gig to being down and dirty with would-be up-and-coming businesses within the same, and trying to help them scale quickly to significant size.

In other words, fighting in the trenches is completely different to attempting to direct from above.

Which Somogyi will undoubtedly be aware of, and hopefully up for the challenge of being part of.

From Callaghan Innovation’s point of view, they probably have little to lose.

An outsider (of NZ candidates) solves a few of those political/business bias challenges that can arise in such a pivotal, potentially game-changing position.

CI may’ve thrown a double six just found the exact person they need.

Or not.

He’s only been in the GM accelerator services role for a month or so, and Somogyi is probably doing a lot of listening while trying to make sense of the disjointed research, development, commercialisation and funding and investment scene in this country.

Welcome to New Zealand Chris.

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