Kōrerorero #14

Welcome to our Q&A series Kōrerorero .. a forum to discuss and share insights, inspiration and advice from voices of founders and investors within the Kiwi start-up community.

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Conversations with Dave Moskovitz; tech entreprenuer, director, and start-up investor, who gives us his insight into challenges and opportunities for Kiwi start-ups

While Dave humbly describes himself as a professional geek, this literally just scratches the surface of this multi-talented individual.

He's a successful software developer, tech entrepreneur, director and start-up investor. As if that wasn't enough Dave has been investing in Kiwi startups since he exited his start-up in the early 2000’s.

Summarising his achievements is quite a task. To name a few, Dave is Chair of the Global Entrepreneur Network NZ, serves on several boards and was key in kicking off the Startup Weekend movement in NZ.  He was the AANZ “Archangel” in 2018 and was a founding member of the AngelHQ. We chat to Dave today about his views on the NZ startup ecosystem

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As an Angel investor, what do you look for before investing?

The key thing is for both the founder and the company to be purpose-driven, with a purpose that resonates with me eg overcoming the challenges that face our society and the planet. These days I'm mainly focused on education technology (EdTech), as I see education (and more generally science) as a key to improving ourselves and our society, and education is one of the last big fields to be fully digitally disrupted.

The founders need to have significant domain experience, global aspirations (that they've validated and started to execute on), the beginnings of a strong team, charisma, the ability to sell, and indications that they are or could become great leaders.

They need to show they are committed to the long term, and are working hard to achieve their dreams. The market they're operating in needs to be big and interesting. The tech that the company has developed needs to be differentiated from other players in the global market and scalable..

What are your top tips for Kiwi companies with high-growth potential?

• Validate your assumptions. Treat your business like a science experiment.
• Get the best possible team together.
• Start talking to potential investors as early as possible. Most of us like watching the work as it unfolds. How people deal with challenges is very revealing.
• Waste no time in exploring offshore markets. Start building your offshore networks and knowledge of market conditions even before you launch in NZ. Every week you spend figuring out how to be successful in NZ is a week you're wasting learning the wrong lessons for how to be successful globally.
• Maintain good relationships with people. You never know when you're going to need someone. This is best accomplished by just being a good person yourself.

What or who inspires you in the tech startup world?

Purpose-driven entrepreneurs who are changing the way the world operates with their startups. I really love it when my first reaction to a startup is  "they can't do that, it's too hard" but they've figured out a way to make the impossible easy.

What did you learn from your early investments?

•  Things often take a lot longer and are significantly more expensive than originally planned. But we already knew that.
• Overseas markets look a lot different to New Zealand. We are superficially similar to the large economies we'd like to operate in, but we are fundamentally different in scale. Because we're used to a small, flat economy, Kiwis are often flummoxed by scale and the distribution strategies required to go global. 
• Success is all about the founders. Everyone needs to be totally aligned on purpose, and flexible on how this will be achieved. It's a bit like a marriage. Misalignment between founders and investors can be difficult to repair. Things change - but solid alignment on purpose will carry you through. 
• Luck plays a larger role than people acknowledge. Serendipitous encounters, unforeseeable market changes, the right people showing up at the right time, being let down by people you were certain were trustworthy, competition appearing from nowhere  - these are all things you can't plan for. But key entrepreneurial skills are making your own luck, and recognising opportunity when it knocks. 

What is the most memorable thing you have learnt working with founders?

The more you know, the more you know you don't know. Hence, the best strategy for influencing success as an investor or director is asking the right questions. And the ability to do that depends on building an excellent relationship based on empathy where founder and investor can fully trust each other. We're all learning together.

What are your top tips around governance?

• Being a startup director is not a transactional relationship. Be in for the long haul.
• Be fair and open minded - try to leave your ego at home.
• It may be a significant investment for you, but this is the 200% focus of the founders for a big chunk of their lives. They're giving it everything they've got, (And if not, you've chosen the wrong investment)

What differences do you predict for Kiwi startups and our ecosystem, in the next 5 years?

We're on the cusp of massive change, with the pandemic as a forcing function. The market is awash in opportunity, and there's never been more investment capital available.

If we can evolve our entrepreneurial culture and remove some constraints (global connectivity, shortage of talent, our own aggregate lack of ambition) we can 10x our entrepreneurial ecosystem. And we can create the world we want to live in where the main constraint on success will be our imagination for how to create products and services that delight the global market in a sustainable way.

As an entrepreneurial ecosystem, we'll be more diverse, better reflect te ao Māori, be more relevant, more valuable, and more ingrained in the way "normal" people think about who they are and what they do. Will that massive change be a change for the better? That's up to us.

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This is our 14th Kōrerorero of the series.