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More good than harm: Australian start-up hits back at incubator criticism

Incubated tech start-ups in Australia are doing just fine, says Liquorun CEO and founder Joel Macdonald.

Greg Twemlow made some sweeping statements about the status of incubated tech start-ups in Australia in an opinion article earlier this week. I can only suggest he hasn’t been speaking with the right start-ups or incubators in order to form his opinion.

Just as there are excellent and not so excellent businesses of all kinds, the same is true for start-up incubators. But "unethical incubators" have not been my experience, nor that of the tech start-up founders I speak to on a daily basis.

My own start-up, Liquorun, currently provides an on-demand take-away food and alcohol delivery service. It has benefited greatly from the tech incubator program, run by Sydney-based BlueChilli.

There are many arguments to be made about the level of capital available in Australia, but too many start-ups want to run before they can even crawl and believe that their ideas are worth millions, and that Australian venture capitalists should be lining up to support them. This simply shouldn’t be the case.

Without BlueChilli we would have spent twice the amount of money on our business idea with only limited validation. The focus on the science behind the minimum viable product (MVP) approach of the incubator has saved us a lot of time and money and kept us growing.

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Our incubator also gave us access to a larger network of investors - one our founders may never have reached, and even if they had, certainly not in the same short time. They invested not only because they had confidence in the business and its founders – they already knew the rigorous development approach BlueChilli applies to the start-ups they select.

A critical part of Liquorun’s development came as part of a six-month acceleration program that made us realise there was a larger opportunity in on-demand logistics than just building our initial concept of a product for on-demand alcohol delivery. This is something we will be expanding to encompass soon.

And whilst not all start-up incubators are the same, we saw a huge benefit in partnering with a tech-focused incubator that brought the full range of development skills to the table.

The incubator provided not only the business skills required to launch a lean start-up in Australia, but provided the technical and development skills to get our platform to MVP in the shortest time.

Thinking big and being pushed every day with the help from mentors with real world start-up experience and successes has also been invaluable.

Shortly we also hope to access a fund created by the incubator that will match the funding we have raised, dollar for dollar, up to $250,000.

At some stage in the future we may look to overseas opportunities and investment but we believe, if we can prove our idea in the Australian market, we can scale globally when the time is right. BlueChilli’s recent expansion into the US, Europe and Asia means those doors are already opening for us.

There are a number of strong and reputable incubators for entrepreneurs to access in this country. Like all things, do your due diligence and partner with the one that offers your idea the most support and the greatest chance of success.

f, like us, you need technical expertise to get the idea off the ground then make sure your incubator can provide that.

Sure, time will tell whether the incubators make more money than the start-ups themselves. There will be a time when we may need to go offshore to raise large scale funding but the success of your start-up should not be dictated purely on who incubated it. There are so many factors you need to get right.

Start with a great idea, keep lean and focused. There’s really nothing to stop tech start-ups having a great impact on the economy in Australia.

Joel Macdonald is the CEO and co-founder of Liquorun.

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