dd - attack wins - csiro research · accel – new $2bn fund • a “quanfied, autonomous future...

DigitalDisrup,onTheCrea(onofanewAustralianbusinesslandscapeOctober2016

Agenda

•  InsidethemindoftheDigitalA2acker•  HowtheythinkofFunding•  Tac<cstogrowlargebusinessesveryquickly•  TheDNAofbusinessisbeingrewri2en•  Why‘Domes<cDefenders’arestruggling–andwill

con<nuetodoso

•  WhytheAustralianbusinesslandscapeisbeingfundamentallyaltered

TheChangingAustralianLandscape

DigitalChallengersAustralia

DigitalDefenderAustralia

DigitalChallenger

SiliconValley

DigitalDefender

USA

DigitalA2acker

FutureFund

FasttoMassiveNewValue

0 2 4 6 8 10 12 14

BEA

Facebook

Zynga

Uber

YearsTimeto$1BnRevenue

3Years

5Years

7Years

13Years

90’s 00’s 10’s 20’s

Netscape The birth of WWW

eBay

Amazon -> online retail

TrulyDigital

Disrup<ngTradi<onalIndustry

Oz Seek, wotif

Amazon: cloud Facebook: The birth of Data Science

Apple: iPhone

Facebook

October16 CommercialinConfidence 6

SoFwareEatsIndustryaFerIndustryIndustry Examples

MaterialsMedicineInsuranceBankingMedia NeLlix,YoutubeTransport Uber,Tesla,GoogleK-12 KhanAcademyMobile Google,AppleRecruitment LinkedinSocial FacebookeCommerce Amazon,eBaySoFwareIndustry Oracle,SalesForce,

MicrosoF

Networking Cisco,JuniperPC AppleSemiconductors Intel

October16 CommercialinConfidence 7

SiliconValley

8

Seed Strategics Accelerators

Venture Capital Strategics

Venture Private Equity Strategics

Seed Series A Series B, C and D High Risk Classic Expansion

October16 CommercialinConfidence

SearchForaBusinessModel BusinessExecu,on

SiliconValleyVentureCapital

>$3m <$10m <$20m <$40m

1995 - 2015

$Bn

0

20

40

60

80

100

120

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

October16 CommercialinConfidence 9US Venture

VentureisAliveandWell

Oz$224m

LeanLaunch–‘PreayWellUnderstood’

11October16 CommercialinConfidence

Product Definition Go2Market

Product/MarketFit

1

2

3

FindingProduct/MarketFit

12October16 CommercialinConfidence

IndustryAnalysisisCri,cal

•  Channel Conflict •  Network Effects •  Fast follower / Pioneers take the Arrows •  Critical Mass •  Strategy Tax •  Data Network Effects •  The Innovators Dilemma •  The Dilemma of Small Numbers •  Trends toward Consumerisation •  Segmentation e.g. Millennial •  Viral Adoption •  Switzerland •  The arms merchant •  The knife fight •  Full-stack •  2 points in the Value Chain •  Hidden Knowledge •  Exploit Regulation

•  Greyzone •  Legal Hacking

•  Exploiting the addictive personality •  Making Life Simple – Roboadvisor •  Poison + Antidote •  The Bloomberg model •  Generating Win / Win data exchange •  Middleman – The Value that they Create •  Vertical markets

•  2 sided markets B2B and B2C •  3 sided markets B2B2C •  Creative Market Place •  APX driven market •  Reverse Markets

•  Social – deeper insight •  Attacking a competitors innovation blindspots

•  They define their business too narrowly •  They forget about their customer •  They moves too slowly •  They didn’t listen to their own people •  They failed to Foster a Culture of Innovation

TheAaackercancreateDeepAdvantages

UBER

Accel–New$2bnFund

•  A“quan<fied,autonomousfuture”madepossiblebythe“confluenceofpredic<veanaly<cs,ar<ficialintelligence,machinelearningandcomputervisiontechnologies.”

•  “Enterprise-gradetoolsthatchangethewaybusinessescollaborate,communicateandinnovate.

•  A“goldenageofvideo”isuponus.Thinkmobileproduc,on,distribu,onandmone,za,onofvideo.

•  Growthofan“APXEconomy”wherethird-partyAPIsbasicallyreplacebusinessprocesses.Thinknon-corecapabili,eslikepaymentsystems,analy,csandsearch.

•  “Hardeningsecurity.”Thinkdefenseagainsthackersandransomware,letalonedefendingcyberwarfare.

•  Peoplecan“capitalizeontheirtalentswherevertheyare.”Thinktheriseofan“on-demandeconomy”butonaglobalscale.

DataScience:DataDrivenEnterprise

DataScienceStartup

Industry can’t hire the data scientists and the skills and outsources to experienced data science team. The Data Driven enterprise wires itself into the customers business work flow such that they can’t do business without them. i.e. The Bloomberg model

October16 CommercialinConfidence 15

October16 CommercialinConfidence 16

MarketPlaceB

SupplyC

DemandB

Ver,calMarketPlace

-  APXMarketPlace-  MediaPhone-  DataDriven

October16 CommercialinConfidence 17

Uber

PrivatelyEmployedTaxi

Drivers

B

B

PassengerC

1Build Supply

2 Create Demand

B2B2C

October16 CommercialinConfidence 18

NewDataServiceB

UAVB

2 Business Benefit

1 Data Collection

ExtraDataService

B

MustcontrolthekeypartofDataCollec,on

IOTDataScience

Industry co-operates on pooling data for fraud prevention eg Las Vegas

Yesterday Today October16 CommercialinConfidence 19

FraudmeetsDataScience

October16 CommercialinConfidence 20

DemandSidePlaLorm

RealTimeExchange

B

B

MobileUserC

SupplySidePlaLorm

15 or 30 Sec ads

BrandCampaignsB

B A Real Time Dynamic

Trading System

B TheMediaPublisher

Mobile Video Ad Value Chain

$$$

$$

$

October16 CommercialinConfidence 21

MachineLearningDataSet

B

UsersC 1 The Bootstrap issue

2 The more who use it the more valuable it becomes

AI - The Data Network Effect

October16 CommercialinConfidence 22

Hollywood3.0e.g.Machinima

B

MobileAudienceC 1

2

Build Audience

Use Data Science To

Monetisation Challenge is to transition from YT(450m mthly

uniques) to get audience to mobile

MobileB2C

TheChangingAustralianLandscape

DigitalChallengersAustralia

DigitalDefenderAustralia

DigitalChallenger

SiliconValley

DigitalDefender

USA

DigitalA2acker

FutureFund

•  NewDNAofBusinessbeingCreated•  Emergingbusinesstac<cs•  Concentratedinvestmentstrategies•  AggressiveScaling•  NBSequencingthestartupagainstcompe<tor

•  AustralianBusinessLandscapeisbeingrewired

Summary