“Get yourself in front of customers”: First AML’s Milan Cooper

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When robotics engineer Dr Markus Henke began collaborating with New Zealand scientists in 2015, he never expected to be leading a Kiwi startup from his home country of Germany just a few years later.

But that became the logical starting point for PowerOn, which is developing flexible, soft electronics for robots.

“Our first product will be tactile fingertips for industrial robots to give their standard robotic grippers a sense of touch as we humans have,” says Henke, who is based in Dresden and co-founded PowerOn with colleagues from the Auckland Bioengineering Institute, where he completed his postdoctoral research.

Henke was back in Germany when PowerOn was founded in 2019.

“We couldn’t have founded the company in one place without the other,” he says. “In Germany, there wasn’t the appetite to invest in a company that only had technology and not a product. In New Zealand we had funders, but we didn’t have market access.”

Germany is Europe’s robotics hotspot, accounting for around half of the bloc’s industrial robots. A German government deeptech grant also gave PowerOn 12 months of funding.

“In New Zealand we have brilliant people who have been working with the materials for ages and are really the world-leading experts in it,” says Henke.

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Customers, talent, funding

So PowerOn has divided its talent and resources between Germany and New Zealand to give it the right mix of factors for success.

“It would be a lie to say that everything works smoothly,” Henke says of working with the team on the other side of the world, headed by chief technology officer and co-founder Katie Wilson.

Adds Henke: “We try to organise our communication and project management and general management processes to be as lean as possible, and our development sprints work in such a way that teams can work more or less independently.” 

PowerOn’s founders are among a growing cohort of entrepreneurs going global from New Zealand and basing themselves in key offshore markets to personally tap the right mix of customers, talent and funding.

Among them are Parkable, whose CEO Tony Littin runs the company from Denver. 

The founders of Dunedin startup CloudCannon have gone the extra mile to cover ground in the US. CEO Mike Neumegen is based in San Francisco, while chief revenue officer Chris Wingate calls New York home for now. CTO and co-founder George Philips oversees development of CloudCannon’s content management system, which is used by the likes of Netflix and Twitch, from Dunedin.

The Startup Genome Project, which conducts research on startup ecosystems around the world, has found that startups that go global early “see their revenue grow faster, receive larger funding rounds and are more likely to become scaleups”.

An examination of New Zealand’s startup ecosystem identified 2,400 startups, with 1,400 based in Auckland. Our largest city is entering the globalisation phase of the startup lifecycle, while other centres are less globally connected.

As startups establish networks internationally, they not only grow their international sales, but gain valuable knowledge, and access to funding and talent. The mantra for Kiwi startups is to be global from day one.

But the research suggests our startups have more work to do to live that mindset.

‘Founders are below their peers in targeting the global market first with their products. The ecosystem can do more to promote the importance of global readiness,’ the Startup Genome Project concluded.

New Zealand Trade and Enterprise (NZTE) has always encouraged startups to establish a presence in the markets they are attempting to enter as early as possible, says Michael Murphy, head of tech and services.

“If you want to grow your business in a particular market, you need to be there,” he says. “It’s not about shifting to the US or the UK, it’s about building a global company. It’s about having a global mindset about the business that you’re creating.”

NZTE works with numerous startup founders who are prioritising global connectedness by leading the charge into foreign markets. Some, like PowerOn’s founders, have a founder in a key overseas market, while others run operations back home.

“Some will swap, doing six months about,” says Murphy. “Some are sole founders, in which case they need strong operational leadership back home, a chief operating officer, or a development manager.”

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Where Kiwi startups congregate

In US cities like Houston, Austin, New York and Chicago, Kiwi startups have established operations as they seek to build sales channels, partner relationships and tap funding networks.

“There has been a shift in the US away from the west coast,” says Murphy. “We still have founders who go to San Francisco, Portland and Los Angeles, but Denver has definitely become more of a hub. I think we’ve had something like 17 or 18 startups there.”

In terms of global connectedness, the capital city of Colorado is the sweet spot for startups with a focus across the US. It’s a massive hub for airlines, making its airport the third busiest in the world, after Atlanta in Georgia, and Dallas/Fort Worth in Texas.

“If you’ve got a UK emphasis to your business as well, the timezone works really well,” says Murphy. “You’ve got – depending on the time of year – a three- or four-hour overlap with New Zealand too.”

NZTE has put more business development managers into key cities to help startups establish themselves in overseas markets. It advises them on local entity structures, bank accounts, logistics, taxation and building local networks, says Murphy.

Denver has a particularly active economic development agency that has worked hard to attract startups to the alpine city that’s popular for its access to pristine ski fields, mountain biking tracks and a mountain lake suitable for sailing. If you’re going global, it helps if you can base yourself somewhere scenic.

For anti-money laundering software maker First AML, London is its key international beachhead. In March 2022, the Auckland-headquartered company opened a presence in the UK’s financial hotspot with two of its three co-founders relocating there.

“We really believe that to be successful in those other markets, you need to plant the DNA of the company in that market and the founders are the DNA,” says First AML CEO and co-founder Milan Cooper.

Cooper, and chief revenue officer Bion Behdin, and chief customer officer Chris Caigou hatched the idea for First AML over beers in 2018 as a way to leave corporate life and fix the complicated anti-money laundering checks required of companies.

A $30 million Series B capital raise in November 2021 gave First AML the funds to fuel its global expansion. “A year before, Bion actually moved to Australia and set up the sales team in Sydney,” says Cooper. “Chris and Bion have been able to be quite mobile. We are really thankful that our personal circumstances allow that.” 

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‍Global recruitment increasingly an option

Cooper oversees product and software engineering in Auckland, with Behdin and Caigou tasked with building sales teams to grow First AML’s customer base and revenue. The global split was dictated by the founders’ roles.

“It’s more challenging, obviously, with the time zones and having to connect at the start of the day. It’s turned into a longer work day for sure,” says Cooper.

“I miss having Bion and Chris around day to day as co-founders but, you know, we’re really pleased with the work that they’re doing on the other side of the world.”

Murphy says the trend towards remote working accelerated by the pandemic has not only encouraged founders to relocate to key markets, but sees them increasingly draw from a global pool of talent. “Developer recruitment has changed,” he says. “They may be working from their desktop in Buenos Aires, or their kitchen in Beirut.”

PowerOn will launch its minimal viable product in Germany this month and already has a list of customers awaiting its release, says Henke, who hopes to tap into the growing need for dexterous robotics as Germany grapples with workforce shortages exacerbated by an ageing population. “We are currently in discussions with German and European funds regarding our next round. We hope that we have come to a deal in the next couple of months,” he says.

Communication is key to keeping a fast-growing startup team on the same page, he adds.

“Just because management knows everything and agrees on everything, does not automatically mean that everybody knows what’s happening. We try to make all our decisions really transparent and communicate to everybody.”

For First AML’s Cooper, the imperative for founders with a global outlook is clear: “Get yourself in front of customers if you can. There’s no substitute for founders leading the charge to launch and grow a new market.”

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