Check out this video that captures some of the highlights of Morgo 2009. The 2010 conference, with a theme of Taking Calculated Risks, is shaping up to be another great two days.

Check out the new flight video at www.martinjetpack.com!  More to come ….

Both Jenny and Andy have been recognised for their contribution to the NZ tech sector and involvement across the wider NZ business community.  Listener have named Jenny among the 50 most powerful people in NZ in the fourth ListenerPower list while Andy has been named by Unlimited magazine as one of the country’s 45 most influential business people, in 2007. According to Listener Jenny is “the patron saint of the high-tech sector, her exclusive annual shindig, Morgo, attracts everyone who is anyone in the tech scene and provides and open, dynamic forum for entrepreneurs to make contacts and trade war stories from the entrepreneurial battle front”. And Unlimited have Andy on their list for being the inaugural World Class New Zealander in 2003; the chair of the ICT panel of NZTE’s US beachhead; (and of course!) the role he plays here at No 8 Ventures.  

Andy Lark has joined Dell as VP Global Marketing & Communications - and will continue to be a part-time partner of No 8 Ventures.

Rod as an interesting post on “The Valley of Death”. I view this principally as a mental rather and physical issue. Contextually NZ businesses sit far from the rest of the world and therefore they frame everything in terms of distance. Distance begets an attitude of scarcity -”I don’t have enough because I am a long way from everything…” … “I can’t raise capital because I am so far from it…”

Because I sit in San Jose, CA, I frame everything in terms of proximity. I am close to capital and markets. I have lots because I am close to everything.

How do you change the mindset? First, act like you work and live in Silicon Valley. Switch to the timezone. Work the hours. Network via Skype, Twitter and other tools. Plan a week a month there. You don’t have to drink the crap coffee though.

Second, dream your enterprise as it was going to scale like a US business.

Third, if you think there is a Valley of Death it is likely you will fall into it. Imagine there is a highway instead and go ride it. This is critical. Most NZ businesses plan very conservatively in the hope of mitigating risk and failure. They do so so severely that they constrain growth and expansion, choking the company to death.

It is amazing how quickly all the physical and market issues start to vaporize when you shift your context, aspirations and frame of reference.

And, you need to turn-up. Some say that a great part of success is in turning-up. Most NZ businesses never break-in to the US market because they don’t turn-up.

Technorati : NZ

I was asked on my recent trip to New Zealand about the US IPO market. Somewhat fortuitously I received an email from America’s Growth Capital with a good summary. Here is the rub:

The U.S. IPO market thrived in the 1990s, averaging more than 500 IPOs per year over the entire decade. However, as we entered the new millennium, the once vibrant IPO market drastically shrank, not only because of the implosion of the Internet bubble, but also due to the following reasons: i) the market cap threshold of targeted investments for mutual funds increased as these funds ballooned; ii) the most active IPO underwriters either disappeared or moved up-market; and, iii) overzealous regulation and costly litigation significantly deterred both executives and private equity players.

These factors led to the dip in IPO volume that we saw from 2001 – 2003; however, the U.S. market has clearly rebounded with a strong finish in 2006. In Q406, 89 IPOs were priced- the highest quarterly total the market has seen in recent years. 228 IPOs were priced in 2006 on U.S. exchanges, compared to 202 in 2005, an overall increase of 13%. So far in 2007, 48 IPOs have priced, compared to 40 IPOs at the same time in 2006 (as of March 16). The tech IPO market saw 41 deals priced in 2006, the same number as in 2005. Tech IPO filings increased by 35% from 2005 (51) to 2006 (69). Expect substantially more tech IPOs in 2007-2008 compared to the post-bubble doldrums of 30-40 IPOs a year.

We believe that this increase can in part be attributed to an influx of private companies that sat on the sidelines during unfavorable market conditions and are now considering going public. Most are successful later-stage companies with $30-100 million in revenues. While many of these companies need capital for growth or liquidity, they may be unwilling to raise another round of private equity due to unattractive private valuations and often onerous liquidation preferences. In other cases, these companies do not yet want to sell to a strategic acquiror or have not generated a compelling offer. In early 2007, there is now an abundance of private companies that are proven with strong market penetration, established customer bases, and demonstrable growth and profitability (or near-profitability). However, these private companies do not meet the minimum IPO criteria as determined by the bulge bracket banks and traditional large fund IPO investors.

For the introduction of the kiwi saver scheme in April 07, the NZ Government is changing portfolio investment rules – making investment in NZ and Australian shares free of tax on gains, but tightening up tax of gains on shares elsewhere.  These offshore share value gains will all be taxed annually on an imputed unrealised return of 5% p a.  We have negotiated a carve out for the venture capital industry, and for other investors in young companies which move their incorporation from NZ to raise more money so they can grow internationally.  See pages 12 & 13 of the IRD publication on Offshore Investment Tax.

Interesting piece in BusinessWeek on What Not To Do.

The Long Tail is finally spurring debate. In short, this is how it works: For a major retailer – say Warehouse or WalMart, makes lots of money from blockbusters. Not so for the online retailers selling millions of tracks.

What’s extraordinary is that virtually every single one of those tracks will sell. From the perspective of a store like Wal-Mart, the music industry stops at less than 60,000 tracks. However, for online retailers like Rhapsody the market is seemingly never-ending. Not only is every one of Rhapsody’s top 60,000 tracks streamed at least once each month, but the same is true for its top 100,000, top 200,000, and top 400,000-even its top 600,000, top 900,000, and beyond. As fast as Rhapsody adds tracks to its library, those songs find an audience, even if it’s just a handful of people every month, somewhere in the world.
This is the Long Tail.

In brick and mortar video rental outlets 90% of rentals are new releases. Not so at NetFlix. At Netflix, about seventy per cent are from the back catalog, and many of them are documentaries, art-house movies, and other little-known films that might never have had theatrical release. “The lesson is that what we thought was a naturally sharp drop-off in demand for movies after a certain point was actually just an artifact of the traditional costs of offering them,” Anderson notes. “Netflix changed the economics of offering niches, and, in doing so, reshaped our understanding about what people actually want to watch.”

It is refreshing to see some pretty big brains going at the notion and debating it. Lee Gomes took a swing at the notion in the WSJ to which Chris has responded. Nick weighs in, publishing a more detailed email from Lee.

Where do I sit? The Internet is changing everything (still). I’m not totally getting the math that the majority of sales come from the long tail though. For me this is about using the Internet to efficiently sell and distribute products and services that display Long Tail demand dynamics (produced in small volumes and wanted by few). Some business models – from TradeMe through NetFlix are brilliantly suited to this.

Anderson argues that we are witnessing the decline of the blockbuster. The “emerging digital entertainment economy is going to be radically different from today’s mass market,” he writes. “If the twentieth-century entertainment industry was about hits, the twenty-first will be equally about niches.” I’m not so sure of this as an absolute statement. What is certain is that we will see the emergence of very successful enterprises built to take advantage of the Long Tail.

The book is worth a read, as is this review in The New Yorker.

Technorati : Morgo, No 8 Ventures, The Long Tail

BusinessWeek has a terrific piece on how Web 2.0 is pulling the fragmented mass market together. It starts with a look at how we now allocate out attention – less on the media’s schedule and more on ours (”time” and “place shifting”).

Some nice quotes from Nike who are fully embracing communities with sites like Joga for soccer fans.

“Gone are the days of the one big ad, the one big shoe, and the hope that when we put it all together again it makes a big impact” – Trevor Edwards, vp global brand management, Nike.