PODCAST EP 70
Simon chats with Glen Richards, Former Co-Founder of Greencross Ltd, Shark and Investor on Shark Tank Australia and Veterinary Surgeon.Listen Now
Simon Dell: So, welcome to the show, Richard Webb. How are you?
Richard Webb: Well, thank you very much, Simon, for having me. I’m doing great.
Simon Dell: You’re in Sydney, aren’t you, at the moment?
Richard Webb: I certainly am, yes.
Simon Dell: And how is sunny Sydney today?
Richard Webb: It’s beautiful today. I think it’s going to be about 21 degrees, so it would be nice, yeah.
Simon Dell: Cool. Whereabouts are you based down there?
Richard Webb: I live in the eastern suburbs, so kind of between the city and Bundeye if that makes sense.
Simon Dell: Yeah, absolutely. Now, I’m guessing everybody will recognize the American accent and we’ll come back to that in a second. But just for everyone’s benefit, as I said to you just before we started, you seem to be doing a lot or you seem to be involved in a lot. So, I kind of want to get an idea about what takes up your — what takes your day or what takes up at least the majority of your days throughout the week?
Richard Webb: Great. Well, I have a really simple mission in life and a simple problem that I set out to solve four years ago when we set up our most recent venture, which was initially named Startmesh. But within the next week, you’ll see our new website go live and we’re renaming the company Cataliize. But what I spend my time with and the problem that I set out to solve was that I did not believe the world was set up well to solve major problems, important problems. I believe the world struggles with solving global climate change right now. I think the world struggles with a lot of problems, and almost 85% of venture backed startups fail before their fifth birthday. And therefore, one could conclude there’s a lot of friction in solving problems. And what we believe is that there’s an opportunity to take a lot of that friction out and hopefully make the world a better place at the same time.
Simon Dell: Give me an idea of where you see that friction existing, just whilst you’re talking about that.
Richard Webb: At the microventure level, a venture needs three things to be successful: a very strong purpose, a driven entrepreneur, founder, leader of a movement. It needs the right mix of financial capital and it needs the right mix of human capital. And when those all come together at the same time and they’re all aligned to pursuing the same outcome, you get magic. You get a successful solution to a problem. When that doesn’t work, an investor may walk away and not continue to find you. Your customers may leave you. There’s a lot of things that would happen. Sorry, go ahead Simon.
Simon Dell: No. So, I was going to say to you, what sort of things have you guys been investing in in the past four years, and you’re looking to invest in in the future?
Richard Webb: Yes. So, we are focused on a handful of what we call enabling platforms but across multiple industries. So, what I would say here is that I believe the two-sided marketplace will evolve in the future and that the traditional forced gateway or a hub and spoke model where we had two-sided marketplaces will be replaced by multi-sided marketplaces. So, we’re investing heavily in multi-sided marketplaces which will transform almost every industry from the fashion industry, to the travel industry, to the beauty industry, to the food industry, you name it.
The second thing is, we believe these new marketplaces will increasingly need trust and trust can come in the form of some enhanced technology, distributed ledger technology or the blockchain, but it will also come in the format of new regulation technology companies which will actually independently verify those marketplaces. So for instance today, Facebook is struggling with truth, or trust, or whether or not the members of Facebook are people or something else and that people are using that platform. Because Facebook has, so far, rejected independent regulation. That may be thrust upon them by the EU, but the fact of life is, all marketplaces that are going to be successful will have to be independently regulated. We learned with Enron that this doesn’t work well when the same business that’s helping you grow your business with a consulting service shouldn’t be auditing your business.
So, we focus on that, cybersecurity, asset sharing, a whole range of things that we think are going to redefine the economy. And I think the idea of accumulating assets versus sharing assets is going to transform almost every industry. I believe a fashion designer in the future should be rewarded for the number of people that wear a dress, not for the number of dresses they create.
Simon Dell: Right, okay. We’ll come back to that because I was going to say there’s a lot there. And this is where I say to you this is where it’s going to go off on a tangent. One of the really interesting things when I looked through your profile, and your work history and things like that, is actually where you started. And you started in beer, didn’t you? Because ironically, so did I. I started in beer as well. So, yeah, in a different part of the world, but I stated in beer as well. You started in engineering in beer as well. Well, I started in sales in beer, but much the same thing. Tell me how you ended up in beer.
Richard Webb: Well, I think it was the natural place that everybody wanted to work when they got through university, but I was very fortunate that when I graduated school, engineers were in short supply and I was offered probably about 14 really great roles all over the world. I chose beer, that’s crazy, but yeah. I was offered roles in what was at the time the really exciting city of Detroit to work in the auto industry. I was offered opportunities to work in the oil and gas industry in the Middle East. Some fascinating, but yeah, I chose beer. But it was an interesting experience.
Simon Dell: It was Anheuser-Busch, which for people who don’t know out there, is the home of Budweiser. What other brands were they making at that time? Because this was… Not that I want to reveal your age to everyone, but this was a while ago. It was in the late-70s, early-80s. What other brands were you working with back then?
Richard Webb: Well, we had our flagship brand which was Budweiser, which at the time was probably the highest volume brand of beer in the world. But we had a range of high-end brands with Michelob and we had low-end brands which took the Busch family’s name, so we had Busch. We had acquired land in Spain to prepare for the breaking down of the borders in Europe, and we were preparing to launch a large brewing business in Europe that never ultimately took off. But it was a fascinating time. And interestingly, I use this interesting statistic that — you know the world has changed because back then, less than 6% of the global beer market was craft beer and over 60% of the beer market today is craft beer. So, we are truly seeing the bifurcation of all industries, brands, messages, and everything else. And beer is a beautiful thing to use as an example because I think everyone gets it.
Simon Dell: It is. I often use it from a marketing perspective when I start talking about different target markets, and different channels, and things like that. And as you would see certainly in the Australian market, where the two big brewers are consistently launching more and more niche brands in order to tap into one particular sliver of a demographic somewhere that they think they should — there’s a Heineken Light, and there’s a Corona Light, and there’s all these things coming out that you think, do we really need those?
Richard Webb: Yes, absolutely. But if you think about that, that our individual tastes are unique. So, I believe that we’re going to continue to see even further bifurcation of those brands. I think what the big breweries are witnessing right now is that anybody can set up a brewery in their kitchen. And if someone takes off, they will want to acquire that brewery, or that brand, or that offering. And so, where I see the brewing industry today is, there will be aggregators, consolidators, and there will be innovators. And the innovators, that door is open to anyone right now. And it’s not just the brewing industry, it can be any industry, so yeah.
Simon Dell: Yeah, I think the struggle because my background — I actually used to work for Lion as well back in the early 2000s in Brisbane rather than Sydney. I’ve seen this growth of the craft beer market and I think it is a good reflection for what happens in the rest of the world. I used to — I’ve been saying for years that it was a horrible business to get into because it was so competitive. But I’m kind of thinking the other way now because, as you say, anybody could start a craft beer business tomorrow. You don’t even have to be brewing it yourself. There’s plenty of contractors out there who will do it for you as well. You’ve just got to find the niche. You’ve got to find the niche and the angle that can appeal to a particular market.
Richard Webb: Absolutely. And I believe the real opportunity in the beer industry is to build the production and distribution infrastructure for these ever-increasing number of craft brewers. I think that’s a really exciting area. Most people say, “Oh, no. But I have to own my own brand.” I’m going, “No, you don’t have to own the brand. You just sit in the support role for this new marketplace.” And I think that would be interesting.
Simon Dell: It’s like the growth of dark kitchens, restaurants that no longer have a restaurant front, or any seats, or any chairs, or anything like that, but they’re manufacturing their food in various dark kitchens around the city, supplying through delivery. I guess the beer industry could go exactly the same way as that.
Richard Webb: Absolutely, I couldn’t agree more. The beer industry will go that way.
Simon Dell: The other quick one I wanted to touch on there before we move into stuff that’s more recent was your time with Pepsi. Because I have to say, Pepsi for a very strange reason is one of my probably top three brands that I just love. And I know why, it’s because I drunk an insane amount of it while I was at university and I must be addicted to it. But I look back and I just… This is again going off on a tangent here, I’m really disappointed by Pepsi’s brand in Australia. It seems to do a fantastic job with the brand in the US, but they don’t seem to do a great job with the brand in Australia. I know it’s outside what you do now, but…
Richard Webb: I’d love to give you my thoughts on Pepsi. First of all, I think it was an amazing organization to work for. I work for them not only in New York but I had the fortunate opportunity to work for them in Brazil, and South Africa, and even Moscow before the wall came down, and Dubai, and Singapore, and found my way to Australia. Pepsi was an amazing business. The CEO at the time had two jobs. He was the original slashy. He was the CEO of Pepsi and he was the Dean of the Harvard School of Business. He was prepared to constantly push the envelope, and try new ideas, and give young people a lot of opportunity at an early age.
Pepsi at the time had three legs of business, it was the largest restaurant company in the world because it owned Pizza Hut, Taco Bell, and KFC, bigger than McDonald’s. It was the biggest snack food company in the world, and subsequently acquired Arnott’s here, and the Frito-Lay business is huge around the world. Then it was the second largest beverage company in the world behind Coke. But at the time, Pepsi’s revenue was almost three times that of Coke’s. People don’t realize that.
Also, after World War II, Coke, as a US demonstration of post-war imperialism, built a lot of Coke plants all over the world to lead behind some Americana. At the same time, Pepsi almost went bankrupt because there were sugar rationings at the time and Pepsi didn’t seem to be politically connected. And Pepsi realized that and over time went out to politically connect itself and entered Russia in 1958 with the deal between Nixon and Khrushchev. So, Pepsi did respond to the global market but hadn’t played the role very well during World War II. That would be my take.
And with regard to Australia, I think Pepsi could’ve done a lot more. I think at the end of the day, the country can support two major players in the market. Schweppes was one of them and Coke was the other. Pepsi’s ability to navigate and work with Schweppes was something that was always a problem. But since then, Pepsi has expanded into a whole range of other beverages, and cola really isn’t the main playing field anymore.
Simon Dell: Yeah, it’s a dying category, maybe a slowly decreasing category I guess, especially with the pressure on the volume of sugar that people consume. I’m sitting here with a can of Pepsi Max in my hand right now. That’s how bad it is. As I said, I went to university with the people who smoked a lot of drugs and drunk a lot of Pepsi Max. I just drank the Pepsi Max. I didn’t do the drugs but they all did the drugs, so maybe that’s why I’m indoctrinated with it now. Okay, let’s jump forward onto stuff that’s perhaps more recent and more appropriate for what you do.
I want to get an idea around… I’ve spoken to a few people in the startup scene in these shows, and venture capitalists, and things like that. In 2018, close to 2019, how is the marketplace now for people who are starting up businesses? I guess four or five years ago, there was this mad rush where everyone was looking for the next Facebook and all those kind of things. How does it feel to you now? Are people a little bit more strict in what they’re investing in? Are they looking for certain types of things? Give me an idea about your opinion of the marketplace at the moment.
Richard Webb: My opinion right now for entrepreneurs is the time has never been better. I think the world went through a, over the last 20 years that I have been this serial entrepreneur, I think the world went from the entrepreneur being an outlier, slaying a large corporation with no capital, and with odds stacked heavily against it. I think the consumer and the marketplaces have evolved to what we’d like to say affectionately The Age of the Individual, where three interesting dynamics have occurred simultaneously.
The cost of understanding our uniqueness has collapsed, so the cost of sequencing our DNA in 1999 was over $100 million. Today, with 23andMe, for $49 you can start sequencing your DNA. Your microbiome, your behaviour. We know more about ourselves today than we knew about ourselves just a year ago. The second cost collapse has been the cost of serving that uniqueness. If 100 people are sitting in a room and all want to eat in an hour, they all have the understanding of what to order, which would be right for them, which would be different than each other. And with peer to peer distribution, UberEats, 3D printing and everything else, those needs can be served in an hour.
And the third fundamental change is the cost of setting up a business has collapsed to virtually zero. Anybody who wants to set up a business can set up a business in their bedroom and start selling a product within hours. So, if those three things are occurring dynamically, that means that the barriers and the roadblocks to successful entrepreneurship have collapsed immensely. And therefore, at the same time, this country is incredibly wealthy. If I go back to Australia, this country is incredibly wealthy because it has the largest pension fund in the world on a per capita basis. It hasn’t probably most effectively allocated that capital, but there’s a lot of capital there that could be deployed to help support entrepreneurs.
The real challenge has been the filtering and the picking of how we should deploy capital. That is going to continue to get better but there’s no doubt that some capital goes into ideas that don’t solve problems in the world. So, when we set up to look at this dynamic, we started with a couple of really key early theses: Where is the world going? And then if we were going to help a venture, which is what our business largely does, we would ask three questions. And the three questions would be: What problem are you solving? And I think that is a question that you’d be surprised, entrepreneurs that have built great apps generally cannot answer that question. It is really an important question to answer.
After you’ve told me the problem you’ve solved or you’re attempting to solve, the second question I ask which is somewhat subjective is: Is this a problem we’re solving? So, I’m going to give you two examples on those two questions that are self-limiting. One person came to me with an app that you could gamify gambling and you could get a million people addicted and we could become billionaires. So, when I asked the question about the problem he was solving, he thought about it for a while and he goes, “You know, I’m probably creating a problem.” So, he somewhat self-selected himself out of that model.
And then the second question was, someone had come to me and said, “I can shave two seconds off the delivery of a meal with UberEats with this app, with this new algorithm.” And I said, “Is that really a problem the world should be deploying human and financial capital on? Is that really an important problem?” So, that’s the first two questions. The last questions, if you get through those first two questions is: What makes you the ideal leader of this movement? Because in a new collaborative world, you actually have to convince people to follow you and solve this problem with you because you’re never going to do it on your own.
And there are a lot of great tech developers, and great coders, and great people with certain skill sets, but if you ask whether or not they’re going to be successful leading a movement, they would generally, in most cases, be pretty self-aware and say, “I’m probably not the person to lead the movement.” So, those are our questions that we ask, and our unique way of solving a problem is that we are a mix of human and financial capital that helps any entrepreneur with a worthy solution to a problem, take their idea to the rest of the world. We think financial capital comes in five discrete buckets. It can come from customers in the form of revenue. It can come from governments in the form of a grant. It can come in the form of venture debt. It can come in the form of venture capital, or more recently, it can come in the form of an ICO.
We do all five and a VC generally does one. So, that’s the difference between a venture catalyst model and a capital model. And the last thing is the human capital side, we’re now 173 people and 36 cities around the world. We’re the largest venture capitalist in the world and we’re founded here in Australia. We can take a startup from its home city to 35 other cities within a few weeks. That’s our business model.
Simon Dell: Sounds like a good business model. Red Ocean is another one of your companies. How does that fit in with what you’re doing in Cataliize?
Richard Webb: Red Ocean is my venture fund. I set it up about 14 years ago. I had been an entrepreneur, and I guess I really got into entrepreneurship to stay in the country, and I can come back to how I became the accident entrepreneur and a little bit. But after having a few successful ventures as an entrepreneur and begging other people for money, I had acquired enough resources with some successful trade sales and exits that I could set up my own fund and help the next set of founders. And so, that business was set up purely as an investment vehicle that would invest in companies. And what I learned quickly, that just investing in a company doesn’t ensure success. There was a lot more that had to happen, and that’s where Cataliize came.
Simon Dell:So just back to Cataliize, and one of the things that you said a couple of times is you’re looking for founders who can inspire or lead a movement. What are some of the other traits that you find important in those CEOs and those leaders?
Richard Webb: The first thing is that the command and control pyramid, hub and spoke model is desperately failing. The idea that a relationship between human capital and an idea would be an hourly or a monthly salary payment for time spent versus accretive value delivered is being challenged. Today, over 30% of the US workforce is freelance, so people are quickly arriving at the fact that we’re going to have to come up with different ways of rewarding people for helping a venture succeed.
And so, the idea that we used to have people sign an employment contract that said, “You could only work for me and we would pay you a salary, and that’s the contract relationship. We wouldn’t share our secrets.” I think that model is changing immensely, and the leaders that thrived under that model, that could lead a battalion of people into battle in a wedge fashion, that is different today.
Today, the success of a venture relies heavily on someone’s ability to collaborate and to get people to follow a cause or a movement from afar because they believe in the movement, not in the fact that you’re paying them a pay check and you get to sit in a cubicle, so there. That would be the big challenge. Therefore, when I ask people this question, if you have a strong purpose, you will be resilient and you will be able to bounce off barriers and brick walls. Therefore, your purpose is really important and the problem you’re solving.
The second question is: Do you have the charisma to now convince people to follow you that you do not pay a salary to? And that, from a customer, a supplier, and a human capital input perspective, is a different business model. I meet people that have left very highly-paid CXO roles in large corporations all over the world and they struggle with the fact that they can’t just walk in and say, “Do this because I said to” as opposed to “Do this because this is a good idea.”
Simon Dell:I was going to say, the CEO that leads through inspiration is I wouldn’t say rare, but there’s a lot of CEOs out there that don’t inspire. I’ve met a few in my time, yes. You also mentioned about the terms of growth area. You mentioned things like blockchain, and distributed ledger, and all that kind of thing. There’s lots of people talking about AI. There’s lots of people talking about autonomous vehicles, blockchain. The other one I’ve been reading a lot about is people that are growing meat instead of killing cows. Is there an area that gets you really excited about the next 5 to 10 years?
Richard Webb: I would say autonomous cars, AI, machine learning are enabling technologies. We see them as components to the ventures we’re backing, but we don’t believe the ventures are in the business of AI. We see they’re in the business of hopefully solving a problem and AI just happens to be a really effective way of solving that problem. We see those as enabling technologies. As far as where the world’s headed, I would like to believe that the world’s headed toward individual sovereignty, that the human is in control of their destiny, in control of their personal data, and that collections of people or networks of people are there to support the individual as opposed to exploit the individual. That’s probably a bit of a deep thought.
Simon Dell: No. I’ve been reading Yuval Noah Harari’s 21 Ideas for the 21st Century. He wrote Sapiens and Homo Deus. I don’t know if you’ve read any. He’s very much tackling those same questions around sovereignty of the individual. He asks a big question. As companies get bigger, as more autonomy creeps in and robots start doing things, how do you deal with this massive workforce over the next decade, two decades, could be largely irrelevant and just not required anymore. I’m all for the deep questions.
Richard Webb: Great, perfect.
Simon Dell: So, a slightly different angle here. You’ve obviously worked in a lot of startups, and obviously my personal area is digital marketing. How have you achieved growth yourself? When you sit there day one with a new venture or some new founders and new startup, what’s important to you from a marketing and awareness perspective?
Richard Webb: I am a huge believer that we holistically look at all stakeholders in an ecosystem. So, the customer is incredibly important because the demand side economics of any venture is, if you can’t sell a product or solve a problem, you probably don’t have a reason to exist. But I look at: Who are the early adopters? Who are the people that are going to probably get this new idea first? And we spend a lot of time understanding who that person is before we even get started.
You can spend a lot of time on a laggard and that person is never going to adopt your vision of the world or where you’re going with a product until 90% of the population is on board. So, you really want the early adopters, people that are confident, bold, they’re going to try something out, they want to try something out, and you want to cultivate that relationship. And so, almost every venture that we have backed, they have done an incredible job of understanding who is that early adopter, who is that person that will resonate with your purpose first?
And let’s not spend a lot of time in a scattergun approach finding that person. Let’s really understand what that person looks like upfront. So, in the digital arena and the digital marketing space, we have interesting gateways around the world where we can put in who we want to target with a message, and we can get that message toned around that individual or around that person that will be the early adopter. Let’s get that traction going. So, I would say half of our ventures largely are B2B plays and half are B2C plays. So, there’s a slightly different approach. A B2B is a lot simpler to find that early adopter. I think B2C is different in that regard.
So, we use a whole range of ways of getting it. Once we have a very clear picture and a vision of that early adopter, only then do we then look at the distribution channels to reach that individual, whether they be influencers, or SEO, or programmatic display advertising, or sponsorship, or events. Whatever that is, we’ll come back to how we get to those people from there.
Simon Dell: What’s been, for you, the best channels in terms of growing your businesses, be that Cataliize or be that Red Ocean? Where do you find people connect with you best?
Richard Webb: As Red Ocean goes, we are inundated with people obviously looking for funding for their ventures. We never marketed. We actually have never marketed either company. It’s all been word of mouth, but I’ll come back to a more holistic approach which is Cataliize’s approach. We get 150 ventures a month apply to our program and we generally go forward with about 10 a month. It’s a fairly steep filtering process. We’ve never marketed ourselves. I speak at events all over the world, and generally around the time that we enter a city around the world, we have a plan to be in 100 cities by 2021 and 1,000 people in our team.
We’ve just announced Lisbon, Moscow, St. Petersburg, and we’ll be announcing next month Tokyo. We’re into some really exciting cities. And the interesting thing about, if we want to call it, our movement, is that people around the world are saying, “How do we bring your movement to our city?” And we get invitations from governments, we get invitations from venture capital groups, we get invitations from incubation labs. There’s a whole range of people that have asked us to come to their city and we’re very excited about that.
Simon Dell: I did see that you’ve done quite a few speaking events, so standing up on stage in front of hundreds of people tends to get the word out quite easily.
Richard Webb: We have a wonderful chief marketing officer. She’s diligently, as we speak right now, getting ready to push the button on the launch of our new website under the Cataliize brand. We’re always looking to work with people like you on: What is the way forward? We’re constantly looking at new ways forward, and we’re looking for people like you all over the world that can help our ventures succeed in not only their local markets but in other markets. We have startups in Paris, New York, São Paulo, Amsterdam and Helsinki that want to launch in Brisbane. We’d love to talk to you.
Simon Dell:You know where I am.
Richard Webb: Exactly.
Simon Dell:We’re going to wrap up a little bit here, so I’m going to ask you a couple more questions towards the end. You’ve mentioned all those cities. You’ve obviously travelled a fair bit. You’re obviously originally born in the US and you’ve worked in a lot of places, Southeast Asia, and you’ve mentioned a lot of cities. I’m hoping you won’t get punished for this, but when you look at all the cities around the world, which one gets you the most excited in terms of the startups, the people, the approach, all those kind of things?
Richard Webb: That’s a great question. I’ll first start with the fact that I have chosen to call Australia my home and I have now been a citizen of Australia for about 22 years. I’m a privileged refugee, if I can say that, in that I was able to choose the place I wanted to live and I am hopefully a very good ambassador to the place I live. As far as cities go, and that’s interesting that you say cities, because we believe the world is headed toward largely city-based organizations. Our team in LA is completely different to our team in New York. Our team in Munich is different to our team in Berlin. It wouldn’t surprise you that our team in Melbourne would be different than Sydney.
We do believe the world’s headed toward a city-based business. Interestingly, to answer your question, the cities in my opinion that are the most effective and the most collaborative are the littler cities, not the big cities. I’ll give you my thesis on it. I gave a thesis the other day, quite a few years ago in a TED talk that I believed the world belonged the little countries that had grown up learning to collaborate and not command control the world. So, I felt the US was going to be at a disadvantage in the future. And five years after giving that TED talk, 6 of the 10 fastest growing economies in the world were countries of less than 10 million people.
But I’ll come back to it. I’ll give you some cities. Helsinki; Amsterdam; Austin, Texas. You’re getting these weird little cities, but I think works for those…
Simon Dell: I hear a lot about Austin, actually. I hear a lot about Austin, and mainly from Tim Ferris, who obviously does a big podcast, global podcast, millions of downloads. He moved to Austin recently because I think he felt that it was such an upcoming city. So, I completely understand that one, yeah.
Richard Webb: Yeah, and I will add one more: KL. And I’ll tell you why these little cities have done well, in my opinion, is there’s a strong collaboration between industry, government, and people that want to support the ecosystem, the investment community. And they actually are working with each other as opposed to trying to control it themselves. And so, this beautiful ability to collaborate is what I think makes a city a really thriving ecosystem. So, that’s my two cents’ worth. But I think Australia has some wonderful opportunities. It has depth of capital. It has an incredible education system. It has incredibly innovative people.
The only thing that, in my opinion, that could hold Australia back is its lack of collaboration. But you know, we’ve been through five ministers of innovation.
Simon Dell: That’s not really helping here, is it?
Richard Webb: Yeah, but I’m a huge fan, so don’t get me wrong.
Simon Dell: I always think, the other thing that perhaps holds Australia a little bit is it’s so bloody far from everything. It’s not like you can jump on a plane, and in a couple of hours you’re in a completely different cultural centre. You jump on a plane here and you’re still somewhere that’s fairly hot and barren. It doesn’t change much. There’s quite a journey to get to somewhere that is different and has a different set of values and all those kind of things. I kind of always think that that doesn’t help Australia. It’s one of those little hurdles that I think is holding it back a little bit.
Just to wind up, last few questions: We talked about the new book 21 Ideas for the 21st Century. Are there any other books that you recommend, authors that you recommend? And I’m also interested if there’s any people that you recommend that we should be following, or listening to, or people that inspire you over the years to keep doing what you’re doing?
Richard Webb: First and foremost, I am an avid TED talk consumer. I’m an avid Tim Ferris fan. I am an avid fan of a number of podcasts, and my morning starts with about an hour of podcasts on what’s going on around the world. As far as people that I think most resonate with me, I like some of the books that Thomas Friedman about how he sees the world evolving. His most recent book, if I’m not mistaken, is Thank You for Being Late, which is a great book. If you get a chance to read it, it kind of gives you a great understanding into how the chess set between Russia, China, the US, India and other countries evolve over what may happen over the next 10 to 20 years, and what room there is for really nimble people to play in that space.
And I think Australia can do some amazing things. We have companies like Atlassian that were founded here that have created amazing success on the global stage. I would like to believe that our geographic location is not an impediment, it actually may be our greatest strength going forward, our ability to collaborate and our ability to be resourceful and solve problems. I think Australia is well-positioned. I’m here for that reason. As far as other books, I do bring up a book I talk about all the time. It was written in 1937 by Ronald Coase. He was an economist and received the Nobel Prize in 1991, so it took everyone a long time to figure out what he was writing about.
He wrote the book called The Nature of the Firm. He had moved to the US in the 30s because he believed it was the land of opportunity, and everyone would be an entrepreneur, and he found hundreds of people working for this guy called Henry Ford. He said, “I thought you were all over here to be individual entrepreneurs.” And what he found was the emergence of an industrial age. He wrote a thesis at the time that said that Ford could grow from 1,000 employees to someday maybe 400,000 employees. But because of the cost of the transaction… And his thesis was, “The higher the cost or the barrier to entry, the more people that would work inside a venture.”
He also predicted that the transaction cost would collapse over time and that we would be back to one-man companies. And while he didn’t predict cloud-based computing, the internet, or all of these enabling tools, he did have this vision that a world could exist with transaction costs, we’d get so good overtime that they would be zero and that anybody could set up a business. And he received the Nobel Prize in ’91 because everyone said, “Hey, there’s something to this.” He didn’t get it back in the 30s, but that’s a great book.
Simon Dell: That’s two books onto my ever-growing reading list. I have two shelves of books that I’ve bought and haven’t quite read yet. It is annoying my wife intensely that I keep buying more books and keep adding to it. I buy them faster than I can actually read them. And so, okay, last couple of questions. What have you got planned? We’re reaching the end of 2018. What’s on the horizon for you, 2019? You’re obviously launching the new website for Cataliize. Beyond that next year, what have you got in the pipeline?
Richard Webb: 2019 is going to be a tremendous year for us. In a few weeks, we celebrate our fourth birthday since setting up the business. We would imagine in 2019, our plans are to grow our geographic footprint to about 55 cities. We’ll launch a couple of new funds that are very industry-specific. We plan on building a whole new offering around helping people navigate the journey from a traditional hub and spoke corporate model into becoming their own entrepreneur. We believe that is a really important part of our business to get that right because successful ventures are going to have to navigate a different environment than the one a lot of the entrepreneurs have grown up with. Find us in the learning space in 2019 with a couple of new offerings.
Simon Dell: Last question. If somebody wants to get a hold of you, if they want to ask you a question, if they want to apply for Cataliize, what’s the best way of getting a hold of you or getting into that program?
Richard Webb: The best way to get into the program, there will be in the new website an opportunity to apply to join the team, to apply as a venture. Obviously, because we have a number of funds and opportunity for investors to join, and receive a lot of input on what’s going on around the world, and be involved in some of the fascinating new ventures around the world. I can be found on LinkedIn at RichardWebb, or you can find me at Cataliize. Cataliize, because it’s a frequently-used word, we have replaced ‘Y’ with two ‘I’s, because we believe in the new eye-to-eye movement. That explains the two ‘I’s, and there will be a beautiful brand story that will be launched with the new website, too, so there you go.
Simon Dell: I’d imagine you’ve gone through the same problem as I’ve been going through recently with the ability to find a domain name that just makes sense to start with. You go, “I’ve got a great idea for a company. This is what we’re going to call it.” And then you sit down and try and work out the domain names and you just go, “All the great ideas that we just had for a brand are just out the window.”
Richard Webb: And it’s a challenge, because you have to be able to find the name. You have to be able to communicate the name. You’ve got to find the domain. You’ve got to be able to register a trademark around the name and all that, and that took us a good six months. We knew that we had to change the name because we had some companies with $20-30 million in revenue and the boards were asking us, “Why are we dealing with a company with Start in their name? We’re not really a startup.” That was really true. We were largely helping scale-ups go global. So, there wasn’t an opportunity for us to rethink the name of the company, and I have to say, I think it’s a great name. We’re in the business of catalysing ventures, people, and ideas.
Simon Dell: Whose idea was it?
Richard Webb: I think it was a collection. We have a board of about 10 people, and we were throwing ideas up on the wall, and everyone kind of settled on it. Catalyst had always been in our tagline, so it was not a big leap. Well, Simon, thank you very much.
Simon Dell: Richard, thank you for being on. I know you’re busy. You’re definitely a busy person. I didn’t think I was going to get a bit of a history lesson on PepsiCo today as well, which has been great. Honestly, we probably could’ve sat here and talked 45 minutes to an hour on beer, because that’s a love of mine from a long time ago. But thank you very much for being on the show. Thank you for sharing your ideas with everybody.
Richard Webb: And thank you.