Transcript Synced · select any line to jump ▾ 0:00 Adam Spencer: Let me tell you about our partner, Teamified. If you need to build a top-notch team quickly, Teamified is your go-to solution. They not only provide fractional CTOs, they can also do contractors and even remote team members tailored exactly to your needs. And whether you're looking for expertise in the Philippines, India, or Sri Lanka, Teamified has you covered. What's amazing is that Teamified uses a blend of AI and human expertise to cut hiring times by 50%, cent. Their platform handles everything from automated onboarding to day-to-day management and even performance tracking. You can also handle rewards and recognition, buy equipment, and order training all through their platform. Simplify your hiring process and get the best talent fast with Teamified. Check them out now and transform your team. Go to dayone.fm/teamified. That's dayone.fm/teamified. Thank you, T-E-A-M-I-F-I-E-D, and get started today. Hi, I'm Adam Spencer, founder of the Day One Network, which is bringing the history of the Australian startup ecosystem to you. I believe in founders. It's why I do everything I do at Day One and our media company, W2D1 Media. And that's why the Day One Network exists, to create helpful content for founders. We've got some great shows in development, but a large part of what we do couldn't be done without support from our partners and sponsors. And I couldn't be happier than to be working with NTP, who get community better than any other technology recruitment company out there. A Newcastle company like mine, NTP are invested in seeing the growth of the local tech community in Newcastle, Sydney, and more broadly Australia. So thank you, NTP, for helping us bring helpful content to founders and the startup community in Australia. 1:52 Ric Richardson: Back to the interview. 1:55 Adam Spencer: Hi, I'm Adam Spencer, founder of the Day One Network, which is bringing the history of the Australian startup ecosystem to you. I believe in founders. It's why I do everything I do at Day One and our media company, W2D1 Media. And that's why the Day One Network exists, to create helpful content for for founders. We've got some great shows in development, but a large part of what we do couldn't be done without support from our partners and sponsors. And I couldn't be happier than to be working with NTP, who get community better than any other technology recruitment company out there. A Newcastle company like mine, NTP are invested in seeing the growth of the local tech community in Newcastle, Sydney, and more broadly Australia. So thank you, NTP, for helping us bring helpful content to founders and the startup community in Australia. 2:45 Ric Richardson: Back to the interview. 2:46 Adam Spencer: Hi, I'm Adam Spencer and welcome to Day One, the podcast that spotlights Australian startups, founders, and the organizations that empower Australian entrepreneurship. We go back to the beginning to tell the story of Australia's most inspiring founders and how they built their companies. You're listening to a special interview series as part of a documentary W2D1 is producing about the history of the Australian startup ecosystem. On the episode today, we have— 3:18 Speaker C: Hi, I'm Rick Richardson, serial inventor and fairly well known for the guy that won a big court case against Microsoft for patent infringement back in the early 2010s. 3:31 Adam Spencer: So can you give us a little elevator pitch about what you're up to at the moment? 3:34 Speaker C: I've actually got 3 fairly heavy projects on at the moment. One is just the most recent thing is Wallet Nation, which I'm doing with Angela Clark, ex-VP from CBA. I've also got a project called Deadbolt, which we're really struggling to find a CEO for, but it looks like I'm partnering up with a VC who is, you know, wants to take over management for the project, and that is working out how to curb ransomware, which is pretty heavy. And HavenTech, which is my baby, started with, uh, with Tony Castagna, and, uh, that is getting rid of passwords for logging onto sites. You know, want to make passwords a thing of the past. 4:24 Ric Richardson: You're familiar with a guy named Derek Sivers? 4:32 Speaker E: Yeah, yeah. I liked his first book. He's kind of a very free spirit. The fact that he's in New Zealand now, I just think that's really— he's willing to travel and expose himself to new things. And, you know, hats off to him. And also he's really entrepreneurial, so I just found it really interesting what he did with his CD Baby project. 4:58 Ric Richardson: Yes. 4:58 Speaker E: And I'm always looking for interesting opportunities like that. Tim Ferriss, you know, all of those characters, just find it really interesting to pick up what little things I can to try and roll them into any of the projects that I do. And that's the unusual thing about my situation in that being an inventor, I'm just going from problem to problem and then doing what I can to support the businesses that roll out from those inventions, but I don't have the long concentrated focus that, you know, a normal entrepreneur does, you know, in staying with a business for 5 to 10 years. I've done that once and I found myself being really quite not good at it. 5:43 Speaker C: So— 5:44 Ric Richardson: Is there anything 2 ways. One way, is there anything that from your, you know, inventing that you've taken out of that that helped you run a company? And vice versa, is there anything that running a company helped you be a better inventor? 5:57 Speaker E: The problem is that one of the most important things for inventors is to be self-aware. And to illustrate the point is that it actually reminds me of a time that Pete Cooper got me to speak to some kids at the— at SydStart. And he told everyone in the audience— there was about 300 in the audience— that I was going to do a room just to talk to people who were at the early stages, who want to talk to people who were really technology-driven and want to make sure that at the early stages they do everything they need to do to make sure they're successful. And when I got them in the room, there was 70 with standing room only, which is— I was really surprised that such a high percentage of the audience wanted to know what I was going to go on about. The first thing I did is I asked them, how many of you are CEOs of your own company? And like the majority of them put their hand up. And I said, and how many of you have actually been in business for more than a year? And a large percentage put their hand up. Mm-hmm. And then I said, so if you were the chairman of the board of your company and you can pick any CEO that you wanted, uh, would you pick yourself? And it was like 3 hands. And that illustrated my point is that people who solve problems are different to the people who run a business that solves the problem. And so I, uh, I talk a lot about people really working out the difference between loving the idea of solving a problem and the idea of running a business that solves the problem. And they're two separate things, you know. And so, like, I usually, you know, I've, I've been lucky to be able to solve some significant problems and actually get business partners who, you know, testify to the fact that the problems that I've solved are of, you know, good significance, worthwhile significance. But when it comes to actually running a business, I find that the qualities that make you really good as an inventor or as a problem solver actually make you bad as a CEO, as a business person. They— there's just a parting of the ways in the qualities, like, you know, building a team and working at how to refine the team and managing people that you take on, and then you have to pivot, and then you have to either find, retrain them, or find another opportunity for them, or tell them that you can't look after them anymore. Those kind of things are too much for me. I just, I, I, whenever I hire somebody, I basically take responsibility for their their career. And in fact, I've only ever had to fire 3 people in my life, and one of them was outright, you know, they were abusing the company, and there's no question when somebody does really something wrong. But the other 2, I actually found another business that was after them and paid their first 2 months of salary, so, and, you know, let them be scalped because I didn't want to, you know, fire them. And, you know, One of them actually tracked me down some years later and, you know, realized what I'd done. And I just said, I just, I felt so terrible. The company pivots, and if the person's skills don't fit what happened in the company, then, you know, you're caught in this terrible situation. So all of that, working out marketing, working out customer plans, you know, all the things that happen after you've solved the problem. Yeah. Not my space, although so often the company will head along on its merry way and then run into either a shift in technology or a new opportunity, and they really need me to come in and, you know, move with it. So that gives me an excuse to be curious about anything in a given field and spend lots of time researching and looking at where things are moving, how they're moving, and how to improve. My mantra is the best person to know how to do the next best thing is somebody who did the last thing but is self-aware enough to know how to blow it up and replace it with something better, which no one likes to hear about because everybody's invested quite heavily in the first thing, but technology moves lightning fast. Yeah. 10:47 Ric Richardson: I would imagine every single kid out there at some point thought they were going to grow up and be an inventor. 10:54 Adam Spencer: I know I did. 10:56 Ric Richardson: You know, how did you keep that, you know, curiosity for the world? 11:00 Speaker E: It's an interesting thing about Australians, and it took me a long time to realize it. In fact, it wasn't until I was in my 40s that I really understood what was going on, because I've always been an inventor, but I didn't I thought everybody invented. You know how if you find something really easy to do, you just assume everybody can do it? Like, for example, you know, in guitar, I can play pretty much anything Dave Gilmour can play, but Joe Satriani, give me a break, and Jimi Hendrix, I'm just a write-off. I just can't get his, you know, his loosey-goosey feel. So you just have natural abilities. And when it came to inventing, I just thought everybody solved problems, and I didn't even think of it twice. And it was only when, um, I invented, uh, the Uni-Lok technology, which was software activation, that people made a big deal out of it, and it turned into a big project. And I thought that I'd accidentally done my Mona Lisa, and that was the one thing that I was ever going to do of significance. So I had that big gutsy decision to make, is, um, you know, am I gonna stick my neck out and think that no one else has done this and get a patent? You know, no one else in the world has done this and get a patent. Or am I gonna look back in 10 years and wonder what would have happened if I had have got on and you know, sucked it up and became a, you know, a serious inventor and got the technology going. And it was only much later in my 40s that I realized that Australians have a problem in that we all tend to think of each other as similarly gifted. We tend not to want to stick out from the crowd, you know, the tall poppy syndrome, but that's actually a good thing. Yeah. Because it makes Australians think, you know, egalitarianly of each other. And I find that— I find that refreshing. You know, when my wife and I got home from living in the States for 10 years, that's one of the great things about being home is that everybody thinks of each other as generally, you know, another Aussie and knows no airs and graces. And of course, you run into people that are that think they're God's gift, but most Aussies have got a pretty good self-evaluation and you just find that refreshing. You know, once you've travelled around the world, you see people that are climbing over themselves socially or financially and it's— you know, Byron Bay, that's what I love about living here is the richest guy is still in shorts and t-shirt. Yeah. 13:57 Speaker D: And the homeless guys in their shorts and t-shirts, you can't really tell the difference, you know. 14:04 Speaker E: It's really good. 14:05 Ric Richardson: Back in '92 when you started Uniloc, am I right with that timeline? '92? You know, the startup support that exists today obviously did not exist then. What did you, like who did, How did you get started at that time? Like, who did you lean on? Who was there to help you, you know, figure it all out? 14:29 Speaker D: I had a pretty good run. I had a very dear friend, Jim Revett, who was the correspondent, television correspondent for ABC Television for Vietnam, and he was a tremendous mentor for me and helped me get some news stories going, and that found some people who came in to support. Financially, my parents, they didn't even really understand what a patent was, but they invested the first big chunk of money for me to be able to do patents. And patents were a lot more expensive back then than they are now, even though they're still very expensive. You know, you can spend $35,000 to $200,000 per patent for for international rights, you know, and that's just for one country, right? So it can get quite expensive. But the problem is that if you really are an inventor and you're self-aware, you know that the chances of you moving fast enough as an entrepreneur, as a businessman, is so low that you have to have some kind of insurance that makes sure that if somebody just takes your idea and runs with it, that you've been seen to do the right thing by the people who love you, the people that support you, and the people who've invested in the project. You really have a responsibility to do that. It turned out that nearly a decade later, over a decade later, that investment was worthwhile. It's not— doesn't pay out for a lot of people, but I just think it's irresponsible to not have a patent. You know, I have this expression that not having a patent is like having a Lamborghini and leaving the keys in it. You know, it's just irresponsible. 16:28 Ric Richardson: Hmm, yeah. How many inventions would you say you had come up with prior to the activation technology? 16:38 Speaker D: Um, I was pretty regular at it. It's just, I'd call it problem solving, but the difference between my kind of problem solving and a normal person's problem solving is, you know, how far apart the dots are that you connect, you know, to solve the problem. And I've always had a knack for being able to, you know, join dots that are not really easily, uh, connected. So You know, even as a kid, I was exploring bike designs that were more like a motorbike, straight tubing. You know, when the Mongoose BMX bike came out, I was so disappointed because I thought someone had stolen my idea. 17:18 Speaker E: Right. 17:19 Speaker D: You know, and using motorbike handlebars instead of dragster handlebars and, you know, all that kind of thing. And just what you think is needed to solve the problem, especially if you're doing jumps and stuff like that. It's different to a dragster. There's just something very uncool about, you know, jumping off a mound of dirt with a dragster, a Malvern Star dragster. But, um, you know, and also getting into motorbikes and stuff like that, you could just see straight away that BMX bikes were that, you know, that's the direction. And then also, um, different designs of skateboards, skating with parallels if you're skiing, because you my family were skiers. So that's like, I'm talking like 13 years of age, really young. 18:07 Speaker E: I'm the, you know, those, those kind of things were quite young. 18:10 Speaker D: But, you know, I thought everybody tinkered with, uh, you know, their ideas. And then, uh, later on in the music industry, I was the first guy to connect a Macintosh to a Fairlight and to get it to automate the Fairlight's loading, which Fairlight is a famous music computer. And I became fairly well known as the guy who could get a Fairlight to jump through hoops. And, you know, got to write in Electronic Musician magazine and, you know, all these different— get to talk to all these great musos. And it was my excuse. If I wasn't the top musician in Australia, I could be, you know, one of the rare computer music literate. Yeah. Musicians in Australia, and that, you know, enabled me to meet all kinds of interesting people. Like, you know, Chris Carroll was Michael Jackson's Synclavier operator, and he and I became friends. I got exposed to a real lot of interesting people, but at the heart of it, it was just that ability to tinker and to, um, you know, solve problems that other people don't see. And then eventually I moved into solving a problem that was of such significance that it meant that I dropped everything else and just focused on it. 19:31 Ric Richardson: Yeah, well, that's why I asked how many other inventions you had come up with, because I'm, you know, the activation technology, that was the first patent, right, that you'd ever applied for. How did you know, like, big risk, you said it does, it cost a lot of money to do that. 19:46 Speaker D: The patent? 19:47 Ric Richardson: Yes, yeah, how did you know that you, you you wanted to go down that road? 19:51 Speaker D: Well, I remember sitting out the front of a party in Little Narabeen and sitting in the gutter because I was just— couldn't relate to everybody at the party because I knew that the problem I'd just solved was of really great significance. And I'd read a book by, uh, Jim Fitzsimons talking about the 3 different ways that you protect an idea: copyright, trade secret, and patent. And it was such a big decision because it's so un-Australian to, to think you're the only guy in the world who's done something like that, and that now you're going to go and get someone to write a piece of paper that proves it, and then getting a government to give you a stamp of approval that says, you know, that you claim this for the next 20 years. So it was a real big deal in my head to do that. In reality, the moment that I'd actually solved the problem, which was how to lock software to a particular Mac computer and enable that software to move from machine to machine and realize that it's on a new computer each time by doing a fingerprint of the internal components of each Mac, it was something that was really commercially important. It was a new way of distributing software. It predated the internet because back then it was all floppy disks and people just sharing floppy disks with apps on them. It was just— it was particularly interesting to me because at that time I'd got rights to some music software called One Step. One Step? And had the Australian rights to the source code and wanted to get into distribution. And Apple Stores wouldn't stock it because it wasn't a field that was really growing at that time, the music field. So I needed to find a way to allow musicians to do what they love doing, which is copying software and saying, hey, this really is interesting, this should really work. Yeah. And letting it just travel by itself and then at some stage work out how to get paid for it, which is time bombing. That's really the first way that the technology worked, which was time bombing or crippleware, where you can use the software as much as you want but you can't save your files. Both of those things were dependent on this machine locking technology which I patented. And it basically took off with Uncle Jim's support, you know, a bit of notoriety, Dad helping me with the patent, and then IBM Australia picked up on what I was doing and had me flown to Boulder, Colorado, and Within 3 days of us meeting, they had an offer to do worldwide marketing for the technology with a $500,000 advance. 23:07 Speaker E: Wow. 23:08 Speaker D: That was like— that doesn't happen that often these days, but I tell you what. The other thing was that software was working by then. So, you know, I'd only spent about $30,000— about $40,000 on patenting and about $30,000 on engineering. By that time, but they were just so impressed that they just picked us up straight away and that got us started for the next 4 years until I ended up going to the States. 23:37 Ric Richardson: What year was that that you got involved with IBM? 23:40 Speaker E: That was '93, was within, you know, 3 or 4 months of me inventing the thing. 23:46 Ric Richardson: Yeah, that's amazing. So you invented this technology, you spent $70,000 getting it up and running including patents, you know, IBM hears about you, or did you approach them? 23:58 Speaker E: A very dear family friend was on the Young Achievers Committee, and I'd been looking around for someone for some adult supervision for me, for my business, and he was considering coming in, and he was on the board of the Young Achievers Awards with the GM for IBM Australia. And just so happened that IBM was trying to do a software unlockable technology for CDs, which no one knew about. IBM was in the middle, very early stages of developing CD technology, and they'd spent $35 million at that time. And when they heard what I was up to and I was doing with floppy disks, they wanted to see it working. And then went out to Cumberland Forest And the GM was Ravi Mawaha, a really, really nice, a real gentleman. He became a mentor and got me to explain to his technical team what I was doing. The fact that we were patented and that the code was working, they were just— it was just a bit mind-bending for them because they're used to people coming in with half-cocked ideas. They're not used to people walking in with something working. Yeah. Then I got connected to IBM Boulder, which was the guys who handled software manufacturing for the whole of the company. I met the VP in charge of the area, in charge of software manufacturing, and 3 days later we had a deal. That was a fantastic story because No one had warned him that we were so well along on the process of actually having the thing working. And we actually had the unlocking centre that supplied the unlock codes for the software running out of a MasterCard centre in Auburn, which was very expensive, but it meant that we could do unlocking of software 24 hours a day with a phone call. So I'm in this VP's office and he unlocks a piece of software on his desktop. So he has a Macintosh on his desktop. He gets the music software, he installs it, he runs the, uh, runs the try and buy screen, puts his credit card details, everything. Says, now what? He says, you got to ring this number. So he had to ring a number in Australia and he was shocked because he thought it would be a demo. He thought I'd just give him an unlock code and I said, no, no, this is 'Look, this is actually— you're ringing the MasterCard Centre in Australia.' And he says, 'It's like 3 o'clock in the morning.' And I go, 'Yep, it's 24 hours.' And it was pretty good fun to see his face. 26:57 Speaker D: And he goes, 'This is working. 26:59 Speaker E: This isn't a demo. 27:00 Speaker D: This is working.' I said, 'Oh, well, I'm demonstrating it, but it is actually real. You are ringing up a place.' And then he rings it up and he gets an unlock code. Then he gets— comes to the next Mac. I think they were the only two Macs in the whole of the facility at Boulder. And, um, and puts the same details in, and the unlock code doesn't work. 27:20 Speaker E: And then he rings up and gets another unlock code. 27:24 Speaker D: And I said, I just made $70, that's really good. And, uh, and he was just so shocked, and he just told all the guys in the room— there was about 10 guys in the room standing there just looking at these two Macs, and he said, get everybody down here, we're going to the conference room. And the guy who was looking after us stayed with us in his room, and I said, what just happened? Am I in trouble? 27:49 Speaker E: He said, no, they didn't realize that this was actually working. 27:54 Speaker D: They didn't realize that you'd actually solved the problem because they spent $35 million and they're only about 25% of the way towards what you're doing. Wow. And he said, Rick, you just knocked it out of the park. 28:07 Speaker E: And I went, "Oh, great. 28:08 Speaker D: Well, I hope it works." So it was pretty exciting. Yeah. 28:15 Ric Richardson: So obviously '92, '93 in Australia, the startup ecosystem, startup support, all the stuff that exists today did not exist then. 28:25 Speaker D: No. 28:25 Ric Richardson: Going over to the US, was there anything that shocked you about the difference between the business kind of landscape between Australia and the US? 28:33 Speaker E: Well, I— the only reason I had to go there was that all of our customers were all in the States. IBM had developed relationships in the States. They had moved, uh, all their software manufacturing into Lotus, and Lotus basically stopped doing software manufacturing and just focused on, on their own products. So I could see support for us dwindling, and if I I didn't do something, I'm— I was confronted with possibly going bankrupt, you know, the company not surviving it. So I had to go to the States and things just happen on a scale there that it's very hard to— for an Australian to comprehend. Things move so much faster and there's so much support, you know, Americans are so good at getting in behind an interesting idea. It certainly is the place to be if you really want to hard charge. But the advantage of Australia is that its conservatism and its risk-averseness actually means that you do a lot of due diligence and you actually are a lot more careful. And so I'd say that the quality of the projects here are generally really high. The ability to scam here is so much harder, and people take the responsibility a lot, a lot more. There's a lot of fast talkers. Like, one of the big advantages as an Aussie— it's a disadvantage and an advantage— in that when I made promises, they were usually round about 80% of what I knew I could deliver, just because I felt the responsibility, you know, having started the business with my parents and with IBM. They actually just loaned me the money. They weren't my business partners or anything. But the fact that I felt that much responsibility early, I had not experienced what it's like to have big money thrown at you and have more money than sense, you know. Mm-hmm. In a business. But, you know, when I got to the States, it was also just before the 2000 bubble too. So it was really— I felt really a lot of pressure not to abuse the situation. And you could see people left, right, and center setting up, you know, dial-up internet companies. There was all kinds of shenanigans going on and so many interesting opportunities to get involved with. That's— 31:15 Speaker D: Yes. 31:16 Speaker E: The other thing is that so much is happening there that it's very hard to stick to your knitting. You know, Australia— that's part of the reason why I'm in Byron Bay, is also that I get to visit Sydney from time to time, and when I go down there, it's always packed with people to visit and people to see. But you do get an opportunity to clear your head and really think things out when you're away from it all, and it's— Even worse in LA, like when I first became, went back to being a full-time inventor in 2007, my business partner Craig Echegoyen would still get me sometimes Monday and Wednesday for lunch, and it would always be some business deal, some person come to us with some idea to, you know, to peruse. And it's so interesting and it's so easy to get sucked up into interesting projects, but you get your eye off the ball. Because if you really want to put a dent in the universe, you've got to really do a lot of focused thinking. I know what it's like to tinker around with small to medium-sized inventions, and I know what it's like to have an invention be used on 2.5 billion machines, you know, like software activation is used pretty pervasively and— 32:39 Speaker C: Uh. 32:39 Speaker E: You know, I'd love to, once I learned how to do that, I'd love to, you know, do it multiple times because that's a, that's as an inventor, it's seeing people use your, use your idea is a wonderful privilege. 32:55 Ric Richardson: How does it make you feel to have that big of an impact on the world? 32:59 Speaker E: It's funny, you know, like it's interesting inventing for the first, few months when you're solving a problem, you're usually solving it for yourself or you're solving it for a group of people that you care about, and then you see the potential for the thing to go much bigger. And then your responsibility is only to see the idea not die on the vine, you know, to see it used as much as possible. But, you know, when it gets really used on a large scale, like, you know, what— Yeah. What Microsoft has done with software activation, it's really satisfying. But you know, at the same time, that while the initial seed was my idea and the patent gave me that recognition of being the guy who did that, you know that there's millions of hours of effort from other people who have just seen the value in what you've done and, you know, made it made it palatable for people to use. But, you know, for me, the fact that it, um, is responsible for 26% of Microsoft sales, you know, software activation at the time was responsible for 26% of that Microsoft sales. And, you know, that's, that's really, uh, that's really significant. But, you know, like, their next project, HavenTech, I designed it for my parents so that they could use a 4-digit PIN and not a password, and that their passwords— that nothing needed to be stored on the server side. It's an interesting concept, what I built for, uh, for them actually. And my friend Tony Castagna is the co-founder, business co-founder on that. And, uh, you know, we haven't broken the back of that. There's some banks and some big enterprises are using it, so I know that it's working and that people are benefiting from it. But until, you know, it's used pervasively, I wouldn't say that that project's finished, you know. So, you know, there's always what's next, what you haven't done, and that's my life much more than sitting around looking at, you know, past achievements, although it does give you confidence, especially when you're looking at a problem that confounds you. Like, to give you an idea, the hardest invention I've ever had to fix is white sharks, you know, trying to work out how to detect them and protect people from white sharks, right? The local mayor here in Byron Bay asked me to fix it. Mm-hmm. And I thought, how hard can it be? And it is so hard because there's nothing known about the darn things. There's so many people that have an opinion about whatever you're going to do. Just— it's just a technical nightmare. And although I think we have broken the back of that problem and it's like limited in this, in its financial scope and return possibilities, it still is one of the most irritating problems I've ever had to solve. 36:16 Speaker D: You know, give me a quantum computer or something else like that. That's much more fun, you know. 36:22 Ric Richardson: What's your process when, when someone comes to you with this problem? Like, how do you attack it? 36:27 Speaker E: Um, most of my problems are me trying to fix things myself, although with the shark problem, that was just seeing Simon Richardson, his first 6 months of being the mayor here, and just his total dejection over having just had a gentleman lose his life, you know, on one of our favourite beaches and thinking, why haven't we solved that problem? What is the problem? Why can't sonar pick up sharks? Why can't we see in the water? Why can't we detect them from the beach? How can you see through the surf, you know, the aerated water of the surf? And so you just start to ask a series of questions and find out what other people have done to try and solve the problem, or just look at what technologies are available to solve it. So it ends up that I went through about 4 different technologies at quite expense before I ran into the last one, which was just a bastardization of, of a technique that's already being used and it's quite popular, which is— Mm-hmm. Using green LiDAR to do the equivalent of a topographic map of the seabed. It just so happens that you can also pick up anything else that's in the water. It's incredibly powerful, but just no one had ever thought of using the gear that we use to measure how much coral has moved to see to see an animal moving in the water. So, you know, it ends up that that was a pretty easy fix once I got on the scent of the problem. 38:22 Ric Richardson: We're probably going to skip over a fair bit of the story, you know, the US part, by asking this question, but when did you move back to Australia and How did you kind of start to get involved in the Australian ecosystem as it was kind of evolving? 38:38 Speaker E: Yeah, I came back in 2008 and had pretty much, uh, the company was running by itself by then, and I'd gradually learned how dispensable I was as a manager, as management. And, you know, the more I tried to find myself a job with Craig who was the CEO. He started— we started as co-CEOs, then I became the CTO, then I became chief scientist, and then I did 10 patents for the company. And then after that, I thought, I love doing this, this is my real fun. The real fun I had was the first 3 months doing it at Uniloc. After that, being a CEO wasn't that much fun. And so he, he let me off the hook and I could come home, and we had enough, uh, resources that my wife could pick wherever we wanted to go. And then when the court case, we won the jury verdict, which is the big notoriety of the, you know, half a billion dollars court verdict. Everybody assumed that I'd loaded up and everybody wanted investment and everything. 39:45 Speaker D: But I started getting invited to speak at Tech23 and places like that just to tell the story. 39:52 Speaker E: Because it is inspiring for people, especially in the very early stages when they're thinking about whether they just do the whole, you know, go as fast as you can thing and forget about intellectual property, as against, you know, doing it properly and their cost and the rigmarole of doing patents. By getting involved with that group, I realized, looking out at those faces at Tech23 and at SidStart and at Fishburners, you know, all of the promise and all the hope there, that I shouldn't just take that for granted. And then there was two Australian stories, which were totally unexpected, was the amount of enthusiasm for those episodes. Like Jack Brabham's story was the week before mine, and I thought, wow, Jack Brabham, you know, he's a national icon, he's— 40:49 Speaker D: He's a legend. 40:49 Speaker E: Favorite Son, and my thing came up and it just— it was 2 million people watched it in the first week. And I just thought, that's really ridiculous. And it's not just the headline because I'd been in the front cover of the Sydney Morning Herald being, you know, with the wind from Microsoft. Um, so, you know, that's always a drawcard. People love to see big money, but The story was about being an inventor and about being a normal Australian having a go. And it just really— I had thousands of people sending support and talking about how their uncle or, you know, their son or dad called each other and started talking about their garage projects and how, you know, it was kind of inspiring to see a normal bloke have a go at something like that. And so I sat after that, all of that, you know, interest, and I thought, you know, 2 million Australians had spent 3/4 of an hour, you know, listening to me, to my story and my wife and my story and the story of Uniloc. And I'm thinking, how do you repay that? So I started, um— you know, doing Friday morning inventor mornings where I'd talk to inventors for, you know, 20 minutes to an hour. And they just turn up at a local restaurant where word got around that I was, and people just turn up. And people would sit there in a line waiting for me to talk to them. And it just got out of hand, and I realized that I had to get off my backside and go out and give back to all of this support and interest. And also, things like that are not just, you know, something that happened to me. It's something that's really important for people who are really doing a gutsy thing, which is, you know, trying to solve a problem. It's not just all business people and— No. Trying to go IPO. It's people genuinely trying to solve a problem and spending a big part of their life giving up some of the things that should be, you know, given to playing soccer on the weekend. No, they're tinkering and stuff. Time that they should be spending with their family, no, they're tinkering, trying to get something going. And you've got to respect that, you know. 43:24 Ric Richardson: Do you have any thoughts about about where we are today, the ecosystem, like where we can maybe improve or things that you'd like to see happen? 43:35 Speaker D: Well, I just love all of the enthusiasm I see in all of the coworking spaces and the accelerators and the incubators. I am very conscious of the fact that a lot of problem solvers are really not business people. And a lot of entrepreneurs are so enthusiastic, but they're more interested in the problem than the business. And so I learned back in 2003 what it's like to have a serious business partner. And ever since that time, I've always had business partners. And so I have this, uh, this, uh, illustration that I share with anybody who I meet who I know isn't strong in the business front to realize that there's only 3 types of people in business. There's bush turkeys, free-range chooks, and battery hens. And bush turkeys are really interesting, but if you sat down to a nice cafe and they said the egg was a bush turkey egg, you know, there's a big question mark over it. And that's what it's like for an investor. Yeah. To sit with you if you are half-baked as a business person. And free-range chooks, they know how to do beautiful eggs and everybody knows the value and they're top of the range and you know, there's very low risk that the thing's not gonna be a success. So I always partner with free-range chooks. Battery hens, they know how to produce eggs but they need so much infrastructure they're really like government and enterprise people who don't know how to do the egg thing without all of that infrastructure. So most of the people that I know who get into accelerators and to coworking spaces, sometimes they are free-range chooks, but a lot of the time they are bush turkeys, and they really do need to partner up with the business, with the right business partner. So, you know, I always have a business co-founder. And the other thing is that I've actually been working on a project. It's a bit early to kind of go super public about it. But one of the wonderful things that some volunteers and myself have discovered is the— R&D tax incentive, right? And but there's a twist to it in that the tax incentive is 43% of whatever you spend in R&D, right? And if you're in the very early stages of a business, like pre-commercialization, then everything's R&D, right? Unless you're— unless it's a purely social initiative, if it's— if there's any technology in it, if there's any you know, high-tech applications, then it's totally R&D. And so what we're doing is working out how to factor that funding so that you actually get it at the beginning of a project rather than at the end. Because it's a bit ridiculous to be going to the tax department to get money back after you spend it, because that's when you spend your equity, that's when you've spent all your credit cards, and you're like— Yeah. 47:06 Speaker E: The bottom of the barrel. 47:08 Speaker D: So we're working out how to, um, to bridge finance the R&D incentive, which means if you have a good budget, you only need to find 60% of the funding. And then, uh, we go from there, working out how to help them get friends and family around, and then an angel, uh, angel support where they're coming in for the bare minimum that they need to do to get funded, but also to help problem solvers. And that's why I'm calling them— because problem solvers can be inventors or they can be entrepreneurs, but also to free them of that situation where they're walking into a room with investors and they're starting to talk about an ROI. It's just not feasible, and no one believes it anyway, because if they haven't got business experience in the field that they're solving the problem for, no one will believe them anyway. And so, you know, and that's, that's the most embarrassing thing. Like, every time I watch Shark Tank or, you know, one of these other shows, if those people actually had a serious business person standing next to them who actually knew about the industry, knew exactly how, how to structure their deal, what the— how to prove the equity valuation You know, because those people in Shark Tank, they're actually not seed investors, they're really growth investors, right? And so it's unfair to put people that are, you know, at the embryonic stages. It's just entertainment. You're not actually helping in that situation, you're just embarrassing them, you know? So I just kind of feel that that's That's the area that we need to do a lot of help. It's great for everybody to be in a room with other entrepreneurs and other startups to learn together, you know, how that works. But to me, I do the reverse. I actually look for an experienced business person and bring them in as my business partner so I can take my idea and replace it with execution that has experience and knows what they're doing, but at the same time not be an enterprise execution person who doesn't know how to start something when you're starting from scratch because that's a pretty rare skill set. 49:40 Ric Richardson: I've really enjoyed this interview, Rick. I love your story. 49:44 Speaker D: Thanks, mate. No worries. 49:46 Ric Richardson: The last question is a question that I ask everybody. It's just the advice question. 49:50 Adam Spencer: Yeah, sure. 49:51 Ric Richardson: You know, if a brand new founder or inventor come to you tomorrow, what one piece of advice would you give them? 49:58 Speaker D: Self-awareness. Know what you're good at and what you're not good at and don't try to, don't assume. There's a big problem with inventors, especially good inventors, is that people say, "Wow, you've solved this problem. You can run that business." And their skill sets are completely different. Self-awareness, the ability to actually say, hey, I can't do everything, and to spend as much time finding that co-founder as you did in solving the problem. That's really important if you're like me, if you're a problem solver and you're not— you don't love the business side of it, because, you know, the business side of it is details and discipline. Yeah. And high-speed execution and cycling. You know, it's lots of work, but people— there's, there's a mindset and there's a capability that really, um, loves that. Like, my most recent, uh, business partner is Angela Clark, and she is so organized, it's actually scary to see somebody— she was running Beam It for the Big Four banks. It's a a payments app and she did everything from the user experience right through to the marketing plan, everything personally and handled quite a, you know, a large project. And she gives me the job list for the week and then I'll vanish for 3 days and come back with a patent and she thinks, "Oh, that's incredible that you did that." But I'm kind of scared of the list of things that I didn't get done and it's just that she is a powerhouse, you know. Yeah. Staying on top of things, just seeing the way everybody surrounds her and wants to support her means that, you know, she's got a good shot at actually making this thing successful. And I— even though I've solved a problem in the crypto space, I'm not a banking person. I don't understand the industry, so it's unrealistic for somebody like me to do that, even though the problem I've solved is pretty important for the industry. So, you know, that self-awareness, I'd say, is the most important thing. And it is not a little problem. For example, I'll never forget, it was a Tech23 event, and Matt Barry and I were having a bit of a debate. We got up after each other, and Matt was talking about telling everybody, hey, 'You can do this. You can be a CEO. Just get on the phone. You know, it's not hard to find the CEO of Telstra's phone number and just call the guy. You know, just don't be scared. Once you do it a few times, it'll come second nature to you.' And he says, 'I don't understand that.' And then I got up, I got up to him and I said, 'How many of you would be happy to speak to the CEO of Telstra if we could arrange for you to talk to him next week. And one or two put their hand up and I said to Matt in front of everybody, we're not alpha males, mate. We're not all alpha like you. You have all this confidence. We don't know the first thing. And it's just organize your mind and to get your act together under that pressure. Yeah. Pressure. It's just not a natural thing for most people. And so being that self-aware, or finding somebody who has actually had success in that situation, and they can walk into that room and make sure they don't foul it up— like, I've, I've walked into rooms with some really heavy characters and, uh, and, and fouled it up. And you— it's one of those things rattle around in your brain for years because you just think, what could have happened if you had just had your act together, or you're just a bit more assertive, or a little bit more confident, you know? So that's the reason why I'm an inventor and not an entrepreneur. 54:12 Ric Richardson: Thank you so much, Rick, for your time. 54:14 Speaker D: No worries. 54:15 Ric Richardson: I really appreciate it. 54:16 Speaker D: No worries, mate. 54:24 Adam Spencer: I hope you enjoyed that interview. More interviews are on the way. Follow the podcast wherever you're listening right now. Stay tuned for more interviews with many, many more amazing people from the Australian startup ecosystem. Thanks for listening and see you next time.
