Background
Tom’s background spans across operational executive, entrepreneur and more recently as an investor and advisor to a number of startups. His journey to becoming a partner at Blackbird might look familiar to anyone who’s ever worked with a venture capital firm. Tom went down the classic career path of management consulting and having an MBA. We had the chance to chat to him about his past experiences. Below are some of our highlights from the show. You can dig into the full episode here.
Family ties
Tom spent many years in Silicon Valley, where he built out Kanopy, a company founded by his sister Olivia. Prior to Kanopy, Tom was an Operations Executive of Ourdeal.com in 2010, one of the original pre-Groupon discount stores. Over a 12 month period he was with the company as they scaled from a handful of staff to over 85, from and from $0 revenue to $25 million. As they went into hyper growth they exited to a joint venture between Channel 10 and Newscorp.
Reaching a profitable exit in just one year is not so common!
Kanopy was founded as a DVD distributor, Tom joined and pivoted the business model to video streaming on-demand. The company quickly became Netflix for universities and public libraries.
One of the key problems that university campuses faced is that their products were often clunky. They weren’t built with the consumer in mind. In the digital economy consumers compare your products to where they get the best experience elsewhere, for video streaming there’s no better experience than Netflix.
Tom recognised that Kanopy needed to reach parity with Netflix and deliver a consumer-driven experience. University campuses and public libraries have many digitally-savvy consumers and catering to them would see real hyper growth for Kanopy.
Choosing to build a game-changing company with a loved one isn’t that unusual. Tom, Olivia, and Kanopy were doing what the Collison brothers did with Stripe and what Mel and Cliff are doing with Canva. Doing business with family has a lot of benefits.
It may be less common, but it comes with a lot of positive factors, from trust, having someone you can lean on, knowing their skills and weaknesses better than anyone in your life. And if you’re close family then there’s likely to be few to no barriers around communication, although that can make for a tricky situation if you have similar personalities and skills.
Olivia focussed on vision, people management, PR, marketing. Tom found his groove with sales, product, and financial management. By making sure they had complementary skill sets they set Kanopy up for success.
Recruiting a startup CTO
Hiring a CTO can be tricky at the best of times. Let alone when you’re based in Perth back in 2011 without the likes of Google or Apple knocking about with offices for you to tap into a talent pool that you might find in other parts of the world. Australia’s tech hub was developing but had not yet become the thriving scene it is today.
Tom focused on hiring for the next 12-18 months. Finding someone who had the functional expertise to help them build out the first version of their platform and an ability to manage an offshore team of developers.
With that in mind, Kanopy took a slightly different approach to most startups and stumbled upon a backpacker from France working behind the counter of their local Fish & Chip shop who would become their CTO!
Amazingly Simon was perfect for the role they initially required and was able to grow with Kanopy over an 8 year period as they scaled their operations.
With not just a French CTO, but also a French Chief Product Officer in their Executive team, Kanopy took a somewhat unique and niche resourcing strategy. They tapped into French university students. Every computer science graduate has to do a one year internship as part of their studies. All of the students wanted to go to silicon valley and it was a relatively easy visa to get. Tom was able to hire 10 students at a time. They were spitting out apps at a super high frequency and with low cost. Later stage financing when you’ve bootstrapped for years.
As your company grows, the types of investors who can fund your startup varies. When Kanopy looked to raise funds back in 2012, Edtech as a vertical wasn’t particularly well known and VCs struggled to get excited about the market opportunity to sell to libraries. What’s more, they didn’t fit the mould of typical startups from the Bay area. They managed to get early momentum and self-sustaining revenue for one!
The team had no choice but to remain bootstrapped until 2016, when they landed a growth investment, which looked more like a deal that combined the best parts of a Private Equity and Venture Capital raise.
They later exited the company mid-2018 to that private equity fund which was a 7 month process. Tom goes into detail on how they achieved this in the episode here.
Who are Blackbird?
Founded in 2012, now with 35 people, Blackbird is one of the APAC region's most prolific technology VCs. Blackbird’s most recent $650million fund is sector agnostic, heavily investing into a wide range of Australian and New Zealand based startups.
Tom recounts the story of how Blackbird raised from tech founders for the first fund. That money saw the fledgling VC firm become one of the first $250k cheques into Canva, as well as others such as Xoox, Safetyculture, CultureAmp, to name but a few. That’s a lot of unicorns to be supported by one fund!
Blackbird's approach
Blackbird's approach to popping the 'BIG' (we want to invest) question? Tom talks about the need for courtship, you need to meet, go on a first date, second date, might move into together, introduce them to parents, and eventually get married.
