Many Australian founders build a good product and then struggle to find enough customers at home to grow. The market is small, buyers are cautious and investment capital is harder to find than in the US. The ones that break through often take the product overseas early.
In this episode of the Scaling Business Podcast, John sits down with his long-time friend Stuart Snyder, co-founder of YourAmigo, angel investor and mentor in the Adelaide startup community. Stuart grew up in what is now Silicon Valley, moved to Adelaide in 1993 and helped build a company that paid out about $60 million in dividends without a single Australian customer. He explains why the US market mattered so much, when to raise capital and what he looks for in founders.
If you are building a business with a product that could sell globally, this one is for you.
From Silicon Valley to Adelaide
Growing Up Around Startups
Stuart’s parents bought a house in an apricot orchard in Cupertino, California, in 1969. The area was known for fruit canning. He went to high school with Steve Jobs. When Apple listed, the people who made money there reinvested in the next generation of startups, and the region changed.
- Early career: He joined the US Navy at 19, then studied accounting at San Jose State University and worked as a qualified accountant.
- A moving job market: He had six jobs in 10 years after university. Changing jobs was easy and usually meant a pay rise.
- A new home: He met his future wife, who was from Adelaide, while travelling, and moved to Adelaide in 1993.
Building YourAmigo
Stuart’s first Adelaide job was with a defence company that signed up $30 million in contracts and grew to 55 people before the team was made redundant. In 1999, he co-founded YourAmigo with people from that team, based on an idea from Flinders University.
- Raising early money: The CEO convinced about 80 Adelaide investors to put in about $4 million between 2000 and 2006, matched with grants.
- Pivoting to find the product: The company started as an internet search idea and moved into automated SEO, getting large websites to rank in Google for thousands of keywords.
- Turning down venture capital: Two Silicon Valley venture capitalists offered a term sheet, but wanted to move most of the business to the US. With one large customer starting to grow, the team took the risk and said no.
- Reaching profit: October 2005 was the first cash flow positive month. Some customers went on to pay more than $1 million a year.
“I knew from Silicon Valley if you had smart people with smart ideas, you could create a very successful business anywhere, especially with the internet.” (Stuart Snyder)
Why Australian Startups Look to the US
Stuart believes Australians are no less capable than people in Silicon Valley. The gaps are in the market around them.
- Few industries to come from: Many people work for government, universities or councils. Founders with deep industry experience are harder to find.
- Little history of investor wins: For years, startups were seen as risky and loss-making. Successes like Canva are slowly changing that.
- Risk-averse buyers: Local customers often want something already tested and proven. At a US trade show, you might meet 10 prospective customers and one will say they will give it a try.
YourAmigo tried selling locally early on and found buyers slow to move. The team decided the same spend on salespeople would go further in the US. MyVenue, another of Stuart’s investments, now works with more than 160 stadiums in the US but none in Australia.
Key takeaway: The US is roughly 15 times the size of the Australian market. If your product can sell there, it is often the better place to invest your sales effort.
Australia’s Advantages
The local market still has strengths. The workforce is more stable and more affordable than in Silicon Valley, where engineers move every couple of years and take knowledge with them. Australia is also a good place to test and refine a product before going overseas.
How to Go to the US Well
Stuart has seen several of his investments move to the US. His advice is consistent.
- Go to trade shows: YourAmigo, HappyCo and MyVenue all went to many of them. That is where you meet customers and salespeople.
- Hire people with connections: The strongest hires were experienced salespeople who already knew the market.
- Be careful who you hire: Some candidates talk a big game and deliver nothing. A founder on the ground can build the relationships to tell the difference.
- Focus on the product: The companies that last are product focused and keep customers happy, even when competitors grow faster by overselling.
“When you’re a founder introducing a new product, you really belong there to sell it because nobody is going to know your product or sell it as well as you can.” (Stuart Snyder)
Tip: Do not expect investors to fund you because you have arrived in the US. It is very competitive, and you need a product that is well thought out before you go.
When to Raise Capital
For most founders, Stuart’s honest answer is that they cannot get investment yet, and are not ready for it. Customers are the best investment.
He sees this as something Australia does well. With less capital available, founders here understand the need for cash flow from customers.
“The best time is when you have a product in market and it’s working and customers really like it and it’s ready to scale.” (Stuart Snyder)
- Before traction: Bootstrap, do the work yourself, use family and friends, and apply for government grants.
- With traction: Raising capital to hire salespeople and grow revenue increases the value of your company.
“Sometimes I think you can’t go much faster than you’re ready.” (Stuart Snyder)
What Stuart Looks for in Founders
After YourAmigo, Stuart invested in eight startups, seven of them from Adelaide, and in the first four Blackbird Ventures funds. The first fund invested in Canva’s seed round. His big angel wins include HappyCo and MyVenue.
- The founder first: He backed people he had known and watched for years, who got things done.
- A large market: He looks for something unique and much better in a big market.
- A balanced team: YourAmigo had technical, business and sales strengths. He believes that mix was a key reason it succeeded.
- Room to pivot: Smart, creative teams can change direction when the first idea does not work.
He also stresses resilience. The first six years of YourAmigo were loss-making, and every Christmas he could not see how the business would last another six months.
Key takeaway: Keep shareholders informed, even when things are not going well. Investors often have connections, and they want to feel part of the business.
Final Thoughts: Build Something Customers Want
Stuart is no longer actively investing, but he still mentors founders who are serious and follow through. His message is simple: get customers, build a strong team, and take a good product to the largest market you can reach.
If you are scaling a startup, start here:
- Test your product locally, then plan your path into the US or another large market.
- Get to customer traction before you chase investors.
- Build a team with different skills, not more of the same.
- Send your shareholders a regular update, good news or bad.
For more insights, find Stuart Snyder on LinkedIn.
