Darren Winterford believes Australian Entrepreneurs would benefit from more networking
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Darren Winterford is the founder and CEO of EdApp, a mobile focused LMS (learning management system) which allows its users to create learning experiences that can be accessed on mobile devices in bite sized chunks which EdApp calls “microlessons”. Prior to EdApp, Darren founded a digital agency that specialised in building mobile apps for large brands, and it was during his time running the agency that the idea for EdApp emerged. In his conversation with Adam, he discussed how first working to build software products for clients was the perfect learning ground for an aspiring founder, as well as his belief that Australian entrepreneurs would benefit from more networking and community building.
Darren on LinkedIn: https://www.linkedin.com/in/darrenwinterford/
Adam Spencer: Hi, I’m Adam Spencer, and Welcome to Day One, the podcast that spotlight’s Australian startups, founders, and the organizations that empower Australian entrepreneurship. We go back to the beginning to tell a 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-
Darren Winterfo…: Hi, I’m Darren from EdApp. EdApp is effectively a mobile LMS, so a workplace learning solution that talks directly to learners’ devices, learners’ smartphones.
Adam Spencer: And just out of curiosity, because I’m from Newcastle, and there’s a company up here called Coassemble, and they do a lot in the LMS space, I think. Are you familiar with those guys?
Darren Winterfo…: We are. Yep, definitely.
Adam Spencer: Are they competition?
Darren Winterfo…: No, no. They’re pretty much just authoring. That’s sort of what they really focus on, whereas we are a kind of an integrated authoring and delivery platform, and we predominantly specialize, well, the platform is primarily aimed at delivery out to mobile devices.
Adam Spencer: Right.
Darren Winterfo…: So, [inaudible] workers really.
Adam Spencer: So before I ask the question, when did you first get involved in the ecosystem, you had the digital agency.
Darren Winterfo…: That’s right.
Adam Spencer: So, you spent a lot of your career working in marketing.
Darren Winterfo…: Correct.
Adam Spencer: … in the moving consumer goods sector, and then you started a digital agency, which then kind of presented you with the opportunity to start EdApp. I’m just curious, why did you want to jump into the world of startups because because it’s very challenging.
Darren Winterfo…: Sure.
Adam Spencer: I’m assuming you had a very successful career and you were making good money. What drove you to do that?
Darren Winterfo…: Sure. Well, I was really interested in global marketing roles, and that’s what I did predominantly out of the UK, and in those kinds of roles, I got to see the growth of digital, and at one stage, we might have had, let’s say, a dozen what they might call above the line agencies, producing material, campaign, concepts, promotional ideas, and I saw that shift to digital beginning to appear probably in around 2004, 2005. Then with the advent of the iPhone and Steve Jobs unveiling that it was going to be open to third-party developers, I could see that that was going to be an absolutely enormous area and I wanted to be a part of it, and I didn’t want to do it with an existing brand or an existing company or clients. I wanted to start myself.
Darren Winterfo…: So, the best way I thought to learn about the space was not to necessarily jump straight into a product-based startup, but instead open a digital agency, hire developers, and build applications and build solutions for top-tier clients that would help, I guess, unveil what the problems were in enterprise and look for the gaps and look for where there wasn’t products off the shelf that could solve large problems, that could be very scalable, that could be global, and that’s essentially why I started the agency, and it became enormously successful. We built some of the first banking apps in Australia. We built relationships with most of the, let’s say, the top 100 companies in Australia. The majority of our customers were ASX listed, but as I used to say to the teams, that wasn’t the end goal. We didn’t want to be an agent. We didn’t want to be someone that just was a gun for hire. What we were doing was using that as a way to really take to market ideas, see if we could establish product market fit without even developing the product.
Darren Winterfo…: So, essentially, we got invited into the boardrooms of Australia, listened to their problems, and then went away and thought about, okay, we’re developing this custom solution for a particular customer, but what are we seeing that’s common. What are we hearing? What are the large problems we can solve, and number two, what would we be really passionate about? So, we looked at probably over the years at Creative License which started in about ’08, probably up until 2013 and ’14, we we’re probably on our eighth idea, and all that was, was isolating engineers to one corner of the room who would work on the current project we were looking at, and everyone else was working for clients, doing that paid work that would help us all be employed and allow us to keep exploring.
Darren Winterfo…: And so, really, it achieved two things. It achieved we could bootstrap because the agency would pay our bills, albeit the agency would have to run at a zero profit, but that’s where the profits went was into employing engineers that would work on the side if you like. And the second thing is it showed us where the gaps were. We had time on our side then to think about what we wanted to do. We were able to test. We were able to observe what was going on, who was being successful, what we thought the ingredients for success were, and we knew that we weren’t going to go into the consumer space. We knew we wanted to go into B2B, and that was the perfect way to get introduced.
Adam Spencer: Why did you know you wanted to go into B2B?
Darren Winterfo…: I’d seen quite a lot of B2C in my time already, and I could see that it was fickle. There was lots of of them at the time, I think, apps that were sort of coming and going very, very quickly. Some of the gaming guys like Firemint, I’m not sure if you remember those types of companies, the makers of Fruit Ninja, people like Halfbrick, and I didn’t have access to that kind of talent. So, I knew that games wasn’t it. And so, then looking out into the rest of the consumer space, I wasn’t confident that I had the background to be able to execute something that was going to be not only successful, but also would last a period of time and build into a large profitable business, and I had a lot of background in obviously dealing with international business, and I thought solving enterprise problems, if we could also solve some of the world’s problems as well at the same time, that would be pretty amazing, and that was one of the reasons why we landed on EdApp eventually.
Adam Spencer: So, were you aware of the startup scene, so to speak, back when you started the agency, the digital agency?
Darren Winterfo…: Yeah, there was a group in this part of Sydney, the Northern Beaches and Manley specifically, and they called themselves Silicon Beach, and their concept, which was a really good one, was that in the same way that San Francisco, if you like, is just north of, sorry, Silicon Valley is just north of San Francisco, Manley situated on the northern shore of the harbor is also very similar and had a sort of similar vibe, and the thinking was, well, could we recruit developers, product managers, designers to come and live on a beach lifestyle and build an ecosystem just north of Sydney.
Darren Winterfo…: Now, it seemed to have quite a lot of legs and there is a few tech companies have come out of Manley and remained there, grown overseas, but they’re base still in Manley, but really, we were just in those days and continually so starved for talent that it would break your heart when you would find a great candidate, particularly an engineering candidate, get all the way through the process, really have a fantastic feeling that this person is going to be a great team member and can really add value, for someone like Atlassian or someone that’s only one stop from Wynyard or one stop from Central Station snap them up.
Darren Winterfo…: The reason was it was the majority of the developers moving into Sydney, if they were international or if they were students, they did live in that inner city area and trying to convince them to come to Manley where rents were slightly more expensive and a bit further away from the city, it was just too challenging. And so, ultimately, that group, Silicon Beach, whilst it made some good progress, it never really progressed into becoming one of the premier startup groups of the city.
Adam Spencer: Roughly what year was that?
Darren Winterfo…: So, this would’ve been from around 2010 up to probably 2015.
Adam Spencer: Right. Was there anything else that was visible to you in terms of… Because I think I mentioned 2012 seems to be about the year that things really started to ramp up.
Darren Winterfo…: Yeah. We were aware of the various startup hubs, and I think we saw the emergence of groups like BlueChilli comes to mind in some of the sort of startup lab offerings. It was really pre-coworking space. That was much later, and the ideas of, I think, bringing entrepreneurs together to work in the same premises were probably a little bit later. At least, they were certainly in Manley, but we certainly saw the growth of the angel investors. There were, yeah, the kind of groups that I mentioned, like Silicon Beach, that the meetup scene had started, and people had began sharing ideas. So, that was about the extent that we saw in this part of Northern Sydney.
Adam Spencer: EdApp started 2015.
Darren Winterfo…: It did, yeah. Yeah, it began as a product called Campus, and we really saw in around 2013, ’14, we began to notice that education, frankly, adult education was broken, and we could see that in the way that sales people actually is where we first saw it, the way that sales people were being trained, and that began to open our eyes up to education in general. When we began to see how few adults post secondary high school or university actually go on to complete any other training at all in their lives, we were shocked, and that’s where we began the idea of putting out a training platform designed specifically for mobile that took advantage of micro moments of a day, and not relying on 90 or 60-minute block, but something that could be achieved in just a few minutes with a much higher frequency.
Darren Winterfo…: We began to see that that could really have application in business around the time that the bring your own device movement really started to take on, and you saw more and more organizations being happy for people to use their own devices at work, and we simply tested the idea with an existing client who did have a very large remote sales team, and as I say, it was simply a matter of building a relationship with that particular client, taking them on a bit of a journey and saying, “Look, would your salespeople be interested in testing something for us?” And once we started hearing back from people that weren’t looking to buy, people that were actually contracting us for something completely different, once we heard them saying, “Look, our sales team want to talk to you. They actually think this is pretty good, and they’ve asked about how much it costs, et cetera,” then we started to realize that we had a potential winner here.
Adam Spencer: So, around the 2015 time when you guys started, how easy or hard was it to get the funding that you needed to launch EdApp?
Darren Winterfo…: Yeah, so I knew that I wanted to, and look, potentially maybe it was the incorrect thinking, but I thought that I had access to a fantastic, let’s call it, user base in existing customers. I had a revenue stream coming in from the agency. I had access to fantastic developers. We knew what great product looked like because we’d built so many. At that time, I really felt like I wasn’t going to go down the traditional VC route. I didn’t want the pressure that sometimes comes from some of those relationships, of course not all the time, but I really wanted to be in control and not have to make any decisions based on finance.
Darren Winterfo…: And so, we were very lucky that the agency continued to do well which, as I say, enabled us to pay developers in lieu of making profit. And so, my view was always that I would bootstrap until I had some critical mass and was then in a much better position to go and raise money, and I knew then that raising money wouldn’t be difficult if we had an audience, if we had evidence of very little churn, and what we were able to achieve from a small office in Manley versus what would happen if we were truly to take it global, and that is exactly what happened. We did find that we attracted attention. The more and more clients we had to sign up and the more signs of growth we had, then really that put me in a much better position to be able to talk to various parties that were interested in funding or indeed acquiring EdApp.
Adam Spencer: When you started EdApp, did you always know that you wanted to exit? Was that always the plan for you?
Darren Winterfo…: I don’t think so. It was mainly I was working in a very large corporate in around 2007, a FTSE 100 company. I knew that I didn’t want to have to wait for my boss or my boss’s boss to give me a promotion to be able to move on this sort of upward trajectory. I knew I didn’t want to be a part of the very typical corporate journey. And so, I wasn’t seeing starting a product as the potential for an exit. I was really seeing it, to be honest, as a career choice and as a way to… I guess, I would probably honestly say as a lifestyle so that I could be in charge and direct a product and hopefully have real impact and being able to be in control of where that impact would be.
Darren Winterfo…: So, I really didn’t want to stay in the very large global. At that time, I was in FMCG, and I didn’t want to, I don’t know, be at the behest of the wins of the company. I wanted to be in control, and I thought we could really make a difference, and it was an exciting area, as it still is, but I mean, in 2007 around that time when Steve Jobs started talking about the SDK, obviously that was a time of enormous excitement, and I could see that smartphone penetration was still so small in enterprise and knew that we could ride that wave. So, I wasn’t thinking exit. I was thinking, yeah, it was a passion. It was something that I wanted to do personally, and of course, I knew that we would be successful. Even within the agency, it was something that I knew I could build a very successful business doing it, but I guess we weren’t thinking exit at the beginning.
Adam Spencer: How did you know you could build a really successful… And actually, first, by the way, congratulations on the sale. To build a company and sell in five years for 40 million, was it?
Darren Winterfo…: That’s it, yeah.
Adam Spencer: That’s awesome. Congratulations.
Darren Winterfo…: Thank you.
Adam Spencer: What gave you that level of confidence to know you could build a successful business?
Darren Winterfo…: I think I’d seen working both here in Australia and then abroad for close to seven years, I think it was a fantastic school in business, and I do recommend that when I’m talking to university grads that, look, jumping straight out into a startup and into a small team is enormously useful and can be enormously inspiring, and you will be able to often skip, if you like, some of the elements of corporate life that people don’t enjoy. But I was extremely lucky in that I got to a global position very, very quickly and was able to achieve, I guess, a real overview of international business, and I was able to jump from category to category and see the real drivers for various products and various categories around the world, and it did allow you a sense of optimism that you could see what really worked and you could see what you could really improve, and even in those days, I think the needs of enterprise in this space was so clear that I was very, very confident that we would be able to build a business around it. That was sort of never in dispute.
Darren Winterfo…: I remember the first thing we did when we came back to Australia was actually sailed up to The Whitsundays and lived on a boat up there for six months with our 18-month-old, and that’s really where the business was born. And I remember just flying back to Sydney for I think it was a wedding, and I think I went out to a Super Rugby game, and an ex colleague had learn that I had jumped out into the digital space and was almost briefing me in the stands on a Saturday afternoon. So, it was never in doubt that what we were doing was in demand and that was going to be profitable, and therefore going to enable us to look at a longer term project while we were doing it which was the key.
Adam Spencer: Fast forwarding to modern day, drawing on your vast experience in the space, what do you think some of the biggest gaps are that exist in the ecosystem of the community today?
Darren Winterfo…: I think in terms of gap, I think one of our problems, one of our issues I think as entrepreneurs is actually that we just don’t network enough. I think it could be some of our Britishness sometimes for some of us that we’re definitely not as outgoing, as dependent on network as our American counterparts. In my experience, American startups talk earlier, they talk more, they are more willing to share, I think they help each other out an awful lot, they’re happy to give introductions. I think sometimes in the Australian startup scene, again, it comes back from some of that playing cards close to your chest until you think you’ve got this perfect product, and then laying it out. There is not enough, I don’t think, impetus on helping and on that networking element.
Darren Winterfo…: I do think it’s a little bit still everyone versus everyone, whereas that’s certainly not the case in the US. I think that’s one thing that without talking about government legislation and some other things we could talk about, government policy and the like, I do think we have to sort of go back to evaluate how early we share, and when was the last three other entrepreneurs you spoke to maybe not in your space, but even in the last 12 months that you lent assistance to and at a very early stage in the co-working spaces. Yes, there is some discussion and there is some of networking, but I still think our default in Australia is one of, let’s say, privacy and hush versus shouting from the rooftops and letting everyone know what you are up to and being open to take advice from others and indeed give it.
Adam Spencer: Talking about advice, what one piece of advice would you give a brand new founder?
Darren Winterfo…: I think related to that, my advice would be to talk to as many people as you can, to not be too reserved, don’t fall into the trap of wanting to, if you like, oh we’re still in stealth mode. It’s really not helpful. You’ll find you’ll gain much more from as many networking opportunities as you can. It’s very, very hard to execute an idea. There’s lots of ideas, but executing on them is the crucial thing. So, don’t be too concerned about sharing what you’re up to. I would also encourage them to begin with the end in mind.
Darren Winterfo…: I talk to a lot of startup founders that think, “Okay, well, what I’m going to do is I’m going to get my business to this stage, and then I’m going to go and talk to a VC.” Well, I think what they should be doing is actually talking to the VC now and saying to the VC, the angel, or whoever it is, “Our goal is to achieve X. Would that be enough for us to then have a conversation about taking it further, or what would we need to do, to achieve to take it further?” And I think that’s something that doesn’t happen enough where people actually say, “Well, okay, what is the actual goal?” It’s not just I’m going to launch, I will see what happens, and then I will go and try and talk to some people that can maybe take me on the rest of the journey. I think you can do all of that even before you press enter on the last line of code. I think you can have those conversations much, much earlier, and I think it’s something sometimes entrepreneurs in this ecosystem are a little bit reluctant to do.
Adam Spencer: With the last couple of minutes that we have here, and I wish I’d scheduled more time with you because I would’ve like, I do want to go into the EdApp story more. This last question, I just want to give you a couple minutes to just talk about something that’s on your mind, keeping in mind that we’re trying to create a documentary here that chronicles a history of the Australian startup ecosystem, and we want people from all corners of the ecosystem to hear this story. What would you want to tell them?
Darren Winterfo…: I think that there is an emerging idea that I think is not often spoken about which is that potentially the ability for the Australian startup scene and those that are quite successful in the startup scene could actually dramatically help out some of the rest of the scene with direct investment, and I think EdApp is a great example of that where SafetyCulture, arguably a top five Australian startup, has actually made the not only two rounds of funding with EdApp but actually made a full acquisition. I do feel like the VC route is not always that the only route that should be considered, and I do think we have a number of very large successful scaleups now in Australia that could also be seen as potential partners in growth, whether that be an investor or in a final acquisition.
Adam Spencer: Thank you so much for your time, David. Just a quick follow up to that, just for pure research purposes, can you list off some of those large scaleups that come to mind?
Darren Winterfo…: So, I don’t think there’s any doubt that Atlassian has been acquiring companies as a way to grow, and you can look at the acquisition of Trello there as an example. Obviously, we’ve got Canva who have made a number of acquisitions. SafetyCulture as I mentioned. They would be three straight away that I would think about that the opportunity for a small startup to be acquired and to produce a product that also talks to their audiences, I think, is, yeah, a fantastic opportunity.
Adam Spencer: Thank you so much for your time today, Darren.
Darren Winterfo…: No worry.
Adam Spencer: Yeah. I’d love to, at some point in the future, do a story on EdApp for Welcome to Day One which is I’ve been doing Welcome to Day One since the end of 2018, just doing founder stories and startup stories, but this documentary is taking a ball of my time. So, yeah, the founder stories have taken a bit of a backseat at the moment.
Darren Winterfo…: Sure. But yeah, no, it’s a great story. We’ve just, even this morning, I stand up, I took my team through three use cases that came in over the weekend where people are using our product. Someone’s using our product to educate on female genital mutilation in North Africa, and so far, they’ve only been on the platform a month, and they’ve educated thousands of people, and thousands of people and mainly women in remote areas throughout Africa.
Adam Spencer: That’s awesome.
Darren Winterfo…: It’s just fascinating. They’re trying to break down some religious norms and some things there. We had someone yesterday, the UN is a big client of ours, UNITAR, and they’ve released a new course on HIV awareness which is being rolled out to hospitals. It’s incredible the amount of… There’s another small company, it’s a consultant, and she started a very popular series on parenting, and rather than releasing it as a book, she’s released them as micro lessons on our platform that then ping your smartphone once a day, and you sort of can refresh yourself on dealing with your difficult child or whatever it is. Yeah, I was actually saying it to our engineering team just the importance about what they’re building. Yes, there’s lots of enterprise using our product, but there’s an awful lot of people using it for good across the world. So, it’s really good.
Adam Spencer: I saw the stat, I don’t know how outdated that stat was, but 50,000 lessons a day.
Darren Winterfo…: Yeah, yeah.
Adam Spencer: That’s amazing.
Darren Winterfo…: It’s getting pretty amazing, and the growth is just, I mean, obviously COVID’s been a huge accelerator for us, but yeah, it’s amazing, and just as you grow people talk about the hockey stick, but it’s just, it’s now, there was a day, I guess, what, in 2018, I probably knew all our customers’ first names. Do you know what I mean? And now you’re at a stage where I wake up and one of our team in New York has said, “Oh, this has just launched, and this is what they’re using the platform for,” and it’s teaching math in a underprivileged school. Someone I talked to last week, she’s in the Dominican Republic, and she’s using EdApp out in sugar cane plantations to talk to Haitian people that think basically that they belong to the plantation owner. So, they’re actually going out with an anti-slavery message because the perception from the Haitian is that this Dominican land owner owns them, and because they housed them and all that sort of thing, and they bought them across from Haiti that they belong to this Dominican Republic plantation owner.
Adam Spencer: That’s happening today.
Darren Winterfo…: That is happening right now.
Adam Spencer: Wow.
Darren Winterfo…: And they just, they don’t understand human rights. They’re very poorly educated. They get promised land in the… Sorry. They get promised work in the Dominican Republic, and off they come, and because they’re boarded and given food three times a day and they work in the sugar cane fields, their assumption is that, yeah, they belong to that plantation.
Adam Spencer: Wow.
Darren Winterfo…: Isn’t it? Isn’t it amazing? There are girls again with absolutely no understanding of even the aging which they should be reproducing in the same area, again, the Dominican Republic. They’re having to educate young girls on sexual health and their rights as a young female. It’s just remarkable that we can get to them, that they used to not be able to get to these people at scale, and now, they’re able to go into the field. There are these cheaper Android devices everywhere, and we have an offline mode so that doesn’t use a lot of data, and these field workers can go out and actually do it at scale. So, yeah, it’s really amazing.
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.