Telstra wants more Australian startup innovation and investment

Telstra wants more Australian startup innovation and investment

Summary: David Thodey said today that trying gaining venture capital in Australia was akin to pulling teeth.

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Telstra wants to encourage more innovation in business, but says investors need to get on board.

Chief executive David Thodey also acknowledged the telco's push to drive customer service online could carry risks.

"You've got to innovate," Thodey told a business breakfast in Perth on Thursday.

"Innovation has got to be at the process level, it's got to be at the big idea level and it's got to be external."

He said Telstra was helping to fund 11 technology start-up companies in Sydney which were focused on education, health and agriculture.

Still, he said the investment response from venture capitalists in Australia was fairly lacklustre compared to the reception the start-ups received on a recent trip to Silicon Valley in the US.

"In Australia it's like pulling teeth," he said.

Thodey, who has recently begun tweeting messages from his own twitter account, said people wanted to be able to use complex products simply.

He said Telstra was eager for customers to use its new app following the lead of banks which had driven their customers online.

But he acknowledged the telco's model of encouraging customers to deal with the company on the internet, rather than face to face or on the phone, could create dissatisfaction.

"There's always a risk but I don't think that's the case," he said. "We've got over three million consumers using the online capability."

He said local high school students were becoming some of the best users of the company's app.

"At the moment we're not seeing any push back."

Telstra receives around 500,000 calls and around 100,000 people visit Telstra shops each day.

Thodey would not comment on how the company was tracking ahead of earnings season or whether there were any asset sales planned.

"It's all price sensitive so I can't say anything," Thodey said.

Topics: Start-Ups, Telcos, Australia

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  • Pulling teeth is easier

    As a person who has tried to raise funds through VCs in Australia I can say that it was one of the most exhausting 6+ months experience that eventuated in raising $0, despite the enthusiastic reception of the idea and the business plan.

    The VC community, if it can be called that, seems to be disinterested in breaking the cycle; They had a tough time raising funds and getting to where they are so why should the next set of entrepreneurs have it any easier.
    3ddie
  • Well, lets see some support from the big end of town

    Another big corporate rabbiting about Innovation - because it's cool, yeah? Right on, youths.

    There's no traction in VC in Australia because there is no VC money. None. Zero. Smaller funds are angel funds and small ($20M is not a VC fund) and noone's going to put in the $5M Series A rounds because they won't be able to follow on and will be diluted in subsequent rounds.

    Since super funds aren't interested in VC anymore, and that's where the money traditionally came from, let's start petitioning those $4bn profit making Telstra and others (mining?) to actually step up and put their money where their mouths are - it's all very well bleating on about "innovating" at a breakfast meeting (hah! dinosaurs) - get out to the startup meetups and see what amazing innovation and enthusiasm is happening, raise a fund, and get all that lovely money out there. Because that is where innovation happens - outside big corporates, outside the rigidity of process and levels of management and all the BS that goes along with that.

    11 startups is a start. An incubator is a start. But post incubator, they won't get far here with small rounds and no Series A to go to in Aus. Second stage startups have nowhere to go, so why not step up and set a precedent, if you're that passionate about innovating, Telstra.
    heyasally