Top ten start-ups of 2008

By Ben Kepes

Last year saw the inaugural Start-Up magazine awards for the top 10 start-ups of the year. This year sees a new crop of entries with no decrease in quality. Given the change in the economic climate between last year and this, it isn't surprising to see businesses focus more on the path to revenue and closely monitor their burn rate. We're stoked to announce that the top 10 start-ups for 2008 are:

eBUS

eBUS was founded by current CEO Carmine Masiello. Their products enable the advertising and media industries to improve quality and profitability while saving time and stress. eBUS has a suite of offerings, all targeted at increasing collaboration, enabling sharing and removing inefficiencies involved in dealing with video footage. Their products allow their customers and end users (generally advertising and media companies) to work together regardless of geographic location.

eBUS have garnered a fair degree of attention, both in terms of funding (Sam Morgan invested soon after selling Trade Me) and awards (Gen-i awards 2007 and 2008; accepted to multiple NZTE Beachheads programmes). With 8 full-time staff, independent contractors and operations already set up offshore, eBUS is growing rapidly. eBUS has been cashflow positive since Day One and has gained over 50 per cent of its domestic market.

Mindscape

Mindscape was founded in February 2007 by John-Daniel Trask, Jeremy Boyd and Andrew Peters with the intention of creating software products that "didn't suck". Tired of software feeling slow and bloated, they set about creating the tools that they, as software developers, would love to use tools that were small, blazingly fast and effective.

Recognising the skills of the founders, Microsoft got in touch with Mindscape and enlisted their help to develop BackgroundMotion a technical best-practice open source application to aid other .NET developers worldwide in understanding how to best architect modern Web 2.0 websites on the .NET platform. This initial development work helped aid early profitability on top of the small seed capital the founders had provided at launch. Since this time Mindscape has released three products for software developers, continued to grow profits and revenue and has customers all over the world - including Fortune 50 companies.

Mindscape has achieved all of this with only three full-time employees and no external funding. They've been profitable since inception and continue to develop both the product and consulting sides of their business.

PocketSmith

PocketSmith is a personal finance application that makes financial forecasting and budgeting quick and simple. Users can easily discover and define their financial future due to the forward-looking focus encouraged by the application's unique calendar paradigm. A 12-month forecast can be generated quickly and represented in a way users can relate to. This is then compared to the users' actual transactions to determine how well they're tracking.

The founders of PocketSmith are Jason Leong, James Wigglesworth and Francois Bondiguel, and the company is self-funded. Having come from managing a listed web development firm, PocketSmith is a new challenge for them from both a business and cultural perspective. The three have founded the business on basic principles of grassroots web entrepreneurship, and as such, believe in running lean, being agile, and investing in their user base and community.

PocketSmith is in private beta, and is currently four months old from when the first line of code was written. In that time it has seen one major iteration; been reviewed by major US tech players; grown its user base to 400 from across the globe; and continues to win favour with a wide demographic of people who need a solution for managing their personal finances.

Though still in development, PocketSmith has now begun seeking commercial opportunities, and is in discussion with retail banks both domestic and abroad.

Celsias

Celsias was created in March 2006 as a personal Carbon Trading platform. It became a 'traditional' blog in July 2007, and in 2008 developed tools to help people combat climate change, and bring the green community, companies and organisations closer together. Celsias.com helps individuals, companies and organisations do practical things to combat climate change.

In additional to its thousands of individual members, more than 175 companies and organisations are registered with Celsias including Disney, Sun Microsystems, WWF, Columbia University, The University of Auckland, New Zealand Post and Ausra Solar Technologies.

Companies and organisations that Celsias feel genuinely want to help the environment can showcase their environmental programmes, get interviewed by the Celsias editor, issue press releases, post jobs and advertise both on Celsias, and through Celsias' partners.

To further develop this service, Celsias is currently working with the publishers of Idealog magazine to create EcoInnovator - an online, international resource to facilitate the 'business of sustainability'. Revenue will be created using a 'niche content/services' subscription model, cross-channel advertising and permission-based marketing/advertising.

Celsias is 'read every day' by The Wall Street Journal; has been voted a 'top 5 eco-website' by the Times newspaper; and is quoted by The Washington Post. It has also been featured internationally-recognised internet start-up sites. Celsias currently has five staff, with a team of 120 writers based around the world.

OffTheBack

OffTheBack was launched by James Hanafin, Robert Coleman and David Jones in December 2007. It offers one product for sale each day at New Zealand's best price. They also run special events such as product marathons, lucky dips and codebreakers. Since launch it has been ranked as high as the fifth-fastest growing site in New Zealand.

OffTheBack's major point of difference is the active community of users who shape and guide the direction of the site. Users can comment on the current product, create their own conversation threads or enter the weekly competitions, which all contribute to their community ranking.

OffTheBack says it isn't focused on profitability but rather growth. It was started with zero capital, with all development of the site being done in-house. All profit has been funnelled back into purchasing more stock. They are forecasting $800,000 in sales for the 2009 calendar year. Off The Back currently employs 2 full-time staff in addition to the founders.

Bookhabit

Bookhabit is like YouTube but for eBooks and audio books. Anyone can upload their book and readers can discover a whole new world of niche subjects and writers that traditional publishers can never service. Bookhabit enables authors to self-publish works online for free, becoming part of an online library of works available to readers all over the world. The site includes fiction, non-fiction, plays and scripts, and has potential for any publishable work.

Authors take a 40 per cent slice of each sale, and can earn more than the typical 5-12 per cent traditional publishers might pay. Bookhabit readers can taste a book with a free first chapter before they buy, with a full book starting at US$2.50 to download. The pricing model is a little unusual like art, the price goes up with sales volume (to a maximum of US$5); encouraging people to get in early and to also demonstrate the worth of a popular book.

Since launching in February 2008, Bookhabit has attracted 4000 users, 75 per cent of which are USA-based. Bookhabit is run by Clare Tanner and Stefan Korn, utilises outsourced development and employs 1.3 full-time equivalents.

endemicworld

endemicworld New Zealand's online design store - went live in December 2007. One year later they're tracking well to reach their break-even target within 18 months of start-up.

The directors, 28 year old Elliot Alexander, sister Kate Alexander, and father Grant Alexander are continually reassured by how well their idea is received by both suppliers and customers. Along with vital support from extended family and friends, they're also very motivated by what they have achieved in 12 action-packed months - becoming the number one search result in Google for 'New Zealand design store', gaining a Google page rank of four, reaching 15 per cent of sales off-shore and being a finalist in the Website Category of the 2008 NZ Best Design Awards.

What makes endemicworld 'different' is their ability to network, grow an online community through the blog, newsletter, popular social sites like Facebook, flickr and vimeo and provide an offering to their suppliers, through information sharing and collaboration, that goes far beyond that of the usual wholesale/retail relationship.

In October they launched their own product brand Kinoo, enabling them to better understand the whole cycle from design to purchase. They also draw on the experience of their sister company, design business Studio Alexander. Each business leverages and benefits from the other.

Their future plans? To successfully build their solid foundation into a thriving online community for New Zealand design, enabling New Zealand-designed products to have global exposure and expand their enviable supplier list and customer base.

Polar Bear Farm

Polar Bear Farm was founded in October 2007 by Layton Duncan, making them the world's first commercial native iPhone application developers. The company started out releasing a small application called 'Search', which was the first application to allow people to search contacts and calendar events on their iPhone.

Search was followed quickly by 'ShowTime' the first video recording application for the iPhone. These were instant hits amongst the jailbreak community, with Search going on to garner over half a million downloads, and ShowTime over a million. At that stage there was no official software development kit or documentation on how to develop native applications for the iPhone, so only a portion of iPhone users, those that had 'hacked' (jailbroken) their phones, could download and use these applications.

Polar Bear Farm have been aggressive in taking on the iPhone world, being the first and only native iPhone application developer to exhibit at MacWorld Expo 2008 in San Francisco, three months before any official development platform was announced by Apple, resulting in valuable contacts and opportunities to work with some of the greatest brands and people in the world. Now with the launch of the iTunes App Store, Polar Bear Farm have transitioned from underground iPhone development to legitimate native application development, where their current line up of products have occupied the top ten paid applications on iTunes in over 26 countries between them. Self-funded, with two employees, Polar Bear Farm is already profitable.

Koordinates

Founded (in its current guise) in 2007 by Ed Corkery and Rob Coup, Koordinates is described as a professional version of Google Earth, which acts like an iTunes Store for high-quality map data. They released a private beta in November 2007 and extended that to a public beta in April 2008. Koordinates provides an online platform for selling, buying and distributing high-quality map data. Their target market is professional map-makers including architects, civil engineers, GIS analysts and surveyors; who purchase or make their data due to copyright restrictions and quality issues with free services such as Google Earth.

They've replaced an existing inefficient DVD/phone/mail/email distribution system with a Web 2.0 website and monetise via a commission for sales of data and monthly fees for private sharing of data. A completely self-funded model with 3.5 employees, they're already profitable through data sales and distribution agreements signed last month.

Koordinates first distributor is Ollivier & Co, one of the most recognised names in New Zealand professional mapping and the company is currently negotiating a number of other commercial agreements.

Unimarket

After 10 years of management consulting focusing on supply chain optimization in the US, Unimarket's founder and CEO, Scott Blackwood noticed a pattern of duplication and inefficiencies. Following on from an MBA thesis, Scott developed a business plan for a collaborative procurement process.

Three years later, Unimarket was ready for the world with its SaaS, multi-tenant eProcurement solution portal for customers to access supplier catalogues and contracts, and manage and maintain their purchasing. Unimarket reduces process and product costs while ensuring favourable procurement terms.

Unimarket has developed one of the largest online supplier networks for business procurement in New Zealand, with over 200 supplier-maintained eStores selling anything from global travel & office supplies to IT; catering; furniture and electronic components to Universities, Polytechnics, Councils and corporates who have joined this exclusive network. Unimarket has now expanded to a 16 person operation with employees based in New Zealand, Australia and the United States.

- START-UP TV

Ben Kepes is an entrepreneur, a commentator and a board member. His business experience includes a diverse range of industries from manufacturing to property to technology. As a commentator he has a broad presence both in the traditional media and as an extensive blogger. He sits on the boards of a number of organisations, both commercial and not-for-profit. Ben lives on a 12 acre lifestyle block in Waipara, North Canterbury with his wife and two young children. Despite his current Mainland affiliation, Ben is a born and bred Wellingtonian and has no doubt that Wellington is the home of good coffee.

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