The Federal Government’s much-maligned ‘ideas boom’ ad campaign of summer 2015/16 urged Australia to embrace the digital economy and take their ideas to build the businesses of the future.
Of course, one of the problems here is that, well, not every idea can be built into a viable business, and not everyone is cut out to be a founder.
Aiming to play a part in building “more technology businesses that should be built, not just the ones that can be built” is Dapper Ventures, an initiative of Perth development agency Dapper Apps.
With a growing number of startups being launched by founders with no experience building an app or website before, director of sales and investment Jesse Hill said Dapper Ventures wants to ensure these founders have the right technical partner on board.
Also a problem, Hill believes, is a lack of business experience.
“Typically someone in this situation will have a great idea, they will talk to a few friends and family and then think the next step is to go to a development agency to build it for them,” he said.
“This might work in some cases, but for the majority of situations the next step should be taking your idea and testing it to determine if you really are solving a problem that people care enough about to pay for your product, can you find your customers, who your customers are, and is the market big enough to build a sustainable business?”
It’s very easy, however, for would-be founders to get excited about their idea and go all-in without taking all of these questions into consideration. Many a development agency will be all too eager to take the job, and why not? It’s business, after all.
This is where Hill said Dapper Apps takes a different approach.
“We have always taken the view that building apps that don’t have any chance of success doesn’t help anyone in the long term. You end up with founders that might have excellent potential but the idea isn’t quite right, but then they don’t get the opportunity to build a successful company because they lost their money building something that they shouldn’t have,” he explained.
“You end up with investors burning cash and then becoming cautious about investing in technology, and then as an agency, you get a customer that never comes back because their app hasn’t been successful, so they stop investing in it.”
And so came the birth of Dapper Ventures, an initiative through which the agency will look to help build 25 startups over the next two years.
As part of the deal, Dapper Ventures will invest 50 percent of the development cost into the companies; Hill said the decision to cap this at 50 percent was made to ensure everyone is “aligned and focused on the same goal”.
“By investing 50 percent we are making development affordable, but more importantly we are ensuring that the founders have something to lose. This will keep them motivated to keep on going when things get difficult, which is inevitable,” he said.
“The success of their startup will be largely determined by their passion for the product and customers, so we want them to be motivated to push through the tough times. Then when we get there everyone shares the rewards.”
The developing of this model into Dapper Ventures evolved out of the agency having offered it to three founders and finding it mutually beneficial.
“[We] found that it results in a relationship that is different to the typical client/agency one, which delivers better results. We spent some time refining the offering and gathering feedback from clients as well as VCs, before deciding to promote it at a larger scale,” Hill said.
When it comes to finding those ideas with real potential to build, Hill said Dapper Ventures is looking for businesses with “some form” of market validation, and a solid understanding of and passion for the problem they are looking to solve. Of course, the product must be software-based or have some kind of software component, with a “clear path to revenue from day one”.
As an agency with a 30-strong team, Dapper has significant experience in developing marketplace products, fintech platforms, apps integrating with consumer products, and business-to-business platforms, and as such it will preference ideas in these spaces. Among the clients Dapper Apps has worked with are the Mornington Peninsula Shire, Scancam, and the State Library of Western Australia.
Looking to work with founders across Australia, Hill said Dapper Ventures will also be able to offer collaborators in-house assistance across areas such as sales and growth marketing, and connect them to its partner network for expertise across legal, accounting, and finance.
Image: Gwen Ong, Yu Hei Leung, Hamilton Colyer-Long, Jesse Hill, Ryan Liu, Boyd Hauff, Chloe Constantinides. Source: Supplied.
Daily startup news and insights, delivered to your inbox.