It’s a special occasion when you get the opportunity to listen to someone with half the experience of Benjamin Chong, let alone ask questions to the man himself.
Just briefly, Ben is a:
- Partner at Right Click Capital
- Director at Founders Institute Sydney
- Founder & General Partner at Sydney Seed Fund
What we can say is that Ben certainly knows how to hold a room when he talks. Just watch the live stream from the day and you’ll see that he’s not only an experienced VC but also an engaging speaker.
We’ve handpicked a few standout points from Bens talk but for the full experience we suggest you check out the video live stream from the day.
3 Audience Questions for Ben:
“Whats the biggest challenge Australian-based startups face”
“The big thing in Australia is we need to work out how we get a quick product market fit – and once we have that fit we need to extrapolate that into other markets” – Ben Chong
In Ben’s opinion finding a quick product market fit is one of the biggest hurdles any new business in Australia faces.
The next hurdle is scaling that product globally because, at the end of the day, Australia is a relatively small market of around only 24 million. So, being able to show that your business has the potential to be scaled globally is very important. Ben made the point that if you can demonstrate some traction in the Australian market don’t focus on fixing problems for 3-5 years without ever exploring overseas options.
“What are your thoughts on the recent changes to equity crowdfunding laws?”
Ben emphasised that the new allowances were a good thing for businesses and investors but that the issue lay in sorting the wheat from the chaff when it came to Equity Crowd Funding.
We couldn’t agree more with Ben on that point, as consenting adults, we should be able to choose how and where we invest our money.
The success of our investments should come down to our own decisions and be based upon our level of financial education. However, this raises an issue with Equity Crowdfunding because it’s often seen as the equivalent of walking while looking at your phone.
You’re not actively paying attention to the road ahead just navigating with your peripheral vision by following the feet of people or ‘crowd’ in front of you.
If we want more active investors there needs to be more education for people to understand what constitutes traction, a good team and a good market fit.
Otherwise, we get these Crowd Funded products that are flashily marketed and raise huge amounts of investment but never actually deliver in the end.
“Is there a case for super funds to be a part of Venture Capital funds?”
As a whole, Ben was sceptical about the possibility of any Superannuation funds being interested in early stage investment. Coming back to a metaphor he’d called upon throughout the day, namely the idea that Australian Startups don’t have the ability to “move the dial” for large investors just yet.
Having liaised with large fund managers Ben made the point that the cost for them to write money into a small investment such as an Australian startup is relatively high and that the minimum check a Superfund would be willing to write is around $200 million.
Ben made the point that funds will only write checks around this size otherwise it doesn’t have the potential to move their dial in terms of investment.
Therefore it’s unlikely that we will ever see super funds take an active role in early stage Australian investments.
However, as more of these funds begin to take their investment decisions in-house, we should see them take a more active role in later stage business, pre-IPO businesses (series C & D) who are on a track to liquidity.
Still want more…
Really this was just a taste of what Ben had to offer in terms of his experience, if you haven’t watched the full video yet then we suggest you give it an hour of your time.
Also, if you’d like to be kept up to date with industry news, insights and interpretation of the key events impacting Australian finance Ben curates a daily newsletter called InvestorDaily.
If you’d like to see a more methodical approach to mapping the startup investment journey we’d suggest you check out our presentation from Investible’s Head of Investment, Hugh Bickerstaff.