Tag Archives: Paul Barlow

Equity – Who do you work for?


I have always been one to consider the company I work for as “my company” in a sense that I’ve always treated their money as if it was my own.

This has a little bit of a moral compass about it and not for everyone but hey, we’re all different.

I’ve worked for employers in private and public companies, started my own business which I divested to work for employers again and invested in private businesses as a passive and non-passive shareholder and/or director.

From an ownership sense though, a company can only be your own when you own 100%; the moment you have partners the company is not yours.

I remember a conversation with the owner of a competing business years ago who was insistent that partnerships in business didn’t work and he had to always have 100% of the business so he could do what he wants. Isn’t control good enough?

I put this to a work colleague recently – “You have a business with a few shareholders of which some work in the business and some don’t. If you were one of the working shareholders would you consider that you were working for yourself since you owned the company?”

His answer was “yes” very quickly with the argument that he didn’t care how much percentage he owned of a company, he would consider that he owned the company.

So I put another question to him – “What happens if you as a shareholder don’t work in the business yet the shareholders working in the business decide to purchase a capital item worth $80,000 when the clear written agreement is that any capital item over $10,000 requires unanimous shareholder approval and when you question the process the answer is ‘it is my company and I have this benefit being my own boss’?”

A smile came over his face. “Good point”, he said.

How can you be your own boss with business partners and/or shareholders?

Isn’t your responsibility to all shareholders to follow corporate governance?

What’s stopping you from buying whatever you want with the company’s funds?

Most people going into business want to do so to “be their own boss”. A lot of people do not think about the fact once you have other shareholders you are working for them and that you can only be your own boss when you own 100% of the company.

It should feel good to the passive shareholders that they have partners with “skin in the game” working in the business keeping on top of things.

Either way, I am adamant that unless you do own 100% of a company then you do not “own your own company” and you work for the shareholders.

Having “control” of a company through majority equity or greater then 50% shareholding is a whole other topic; I’ll leave that for another thread as it is/can be a whole new beast.


2 examples of a (my) changing, innovative world


We’ve all heard it before from our parents, “it wasn’t like this on my day”, and yes I am one of those parents now.

I’m not breaking any news story here that technology is (probably) the biggest change from our time to now.

My boys are 20 and 17, along with a little 11 year old girl (sent here to test me in every way imaginable by virtue of having me wrapped around her finger) and their lives are dominated by technology.

Snapchat, Instagram, Facebook, WhatsApp and iMessage constantly vibrate and flood their smartphone screens. They are wired 24/7, it is incredible and hard to control.

Given I work in the tech space, I think about how I struggle with how much technology is controlling their lives and wonder how some of the more “technology challenged” parents deal with it.

There is another big change from “my day” to now and that is the industry of craft beer. The number of imported and craft beers that are available now is mind boggling and something that “wasn’t like this in my day”.

There are now hundreds of breweries around Australia and over 5,000 breweries in the US and growing quickly (to be precise there are 5,005 to the end of November 2016 – http://fortune.com/2016/12/10/america-record-number-breweries/).

Bars specializing in craft beer are popping up all over the place where in Melbourne bars like Beer Deluxe, the Alehouse Project, East of Everything, Howler, The Local Taphouse and Moon Dog Brewery Bar where they have beers on tap and in bottles from all over Australia and the world.

So whilst we are not drinking as much beer in Australia as we used to (apparently), all these imported and craft beers have helped shape a whole new niche industry.

The innovative ways these breweries position and market themselves is every bit as impressive as the innovation in technology.

Now I enjoy sampling craft and imported beers, at home and when traveling. I’m enjoying even more now in documenting this journey through Instagram and the interactions it gives me with my boys’ demographics.


My boys and their mates just can’t believe that our staple beer diet when I was 18-19 was VB, Melbourne Bitter and on special occasions Crown Lager.

They also can’t believe how we communicated with no Snapchat (let alone a mobile or even a smartphone) or even met a partner with no Tinder so we’ll take it all in context.

Technology and Beer – two examples of a changing, innovative landscape. What will be next?


7 vital things that made my startup successful


What makes a successful startup?

There aren’t too many startups like Google and Facebook or even carsales, Seek and REA and the stats tells us that 9 / 10 startups fail (remember 90% of statistics are made up) so my definition of a “successful startup” is growing into a profitable, sustainable business and/or having a successful exit.


I’m sure every one is different in terms of the steps they took, road they traveled and end result so here’s 7 vital things that I found were fundamental to Digital Motorworks Pty Ltd (DMi) being a “successful startup” in 1999:

Identify the market opportunity.
As this will be your focus. This seems simple and it is more than wanting to do something because it’s what you know or to be your own boss. There has to be a gap in the market that you can fill or simply do it better and most importantly, it has to make commercial sense. The market opportunity for DMi was the gap of an independent inventory aggregation and dealer web services player for the big media players wanting to propel their online automotive sites, especially once Reynolds had made the decision to keep their inventory capabilities in order to push carsales (remember the quote “If it is this f&@king hard for us imagine how f&@king hard it is for them” in my post The Hard Decision carsales Had to Make).

Develop (and live by) the Business Plan.
My business partner is a finance guy and started us off straight away with the discipline of creating a financial business plan. I found that by thinking about and collating all the costs upfront and ongoing that we would incur, forced us to articulate a plan for getting money through the door (i.e. revenue). We went hard on the costs and realistic on the revenue because the costs were always going to be incurred but the revenue had to be earned! The importance of this step and ongoing revisiting of it cannot be underestimated.

3 Securing finance.
Most companies need to raise some money to get properly going, be it from family, friends, VC’s or the bank. Most certainly with the latter two and most probably with the former two, the before mentioned business plan is imperative. My business partner and I each secured finance to be used as working capital through the bank as second mortgages on our houses and the business plan was critical to making this process as straight forward as it could be.

Getting out of your comfort zone.
This is stating the obvious because you literally have to do everything no matter what your previous experience or expertise. Almost as soon as we started we were served legally by our former employer. Now this threw me straight out of my comfort zone and made me confront it head on which we did and got through, growing me enormously. My business partner took up a short term contract to get some money through the door with Esanda as they were trying to build Eauto.com.au while I pulled together our technology infrastructure and worked the sales process to secure our first client. This was again jumping out of my comfort zone as my background had only ever been technical. With the help and guidance of my business partner, I made it through the other all the better for the experience and most importantly, it secured the immediate future of our startup business.

Working bloody hard.
Again, this is stating the obvious but until you are in the position where the business survival rests on what you are doing, you don’t really know what hard work is. We just didn’t have enough hours in the day to get through everything we needed to. While my business partner would travel backwards and forwards from Adelaide to Melbourne putting strain on his family life, I would be working on securing clients by day and through our technology requirements by night. Mouth ulcers were a common side effect for me; and those don’t kill you!

Having a passion for what you do.
This one cannot be underestimated. It’s one thing to work bloody hard and it’s another to work bloody hard on something that you have a real passion for and love. We both loved doing what we were doing and our passion for it shone out as I’m sure it helped us secure new clients. This was when I learnt that I could sell anything – if I was passionate about it.

Having the right business partner.
It is ok not to have a business partner, in fact some people believe that you have to have 100% control to make something work. For DMi I had 2 business partners – a former colleague and Digital Motorworks Inc out of Austin, Texas. Having the guys from the US was vital in our time to market and helping us to secure our first big client. They provided the technology platform which I then had to take on, setup, maintain and adapt to Australia and later transform from auto to jobs. This was a great leg up but everything else was on our shoulders in Australia as a startup.

For me getting a startup off the ground with the experience and confidence (or lack thereof) I had at the time, having a business partner on the ground with me was vital. I have referred to my business partner multiple times in the previous points because we really did work as a team. First thing was that I probably wouldn’t have gone into this on my own or been able to get through without his expertise, experience and being able to talk things through. His background was finance and sales in the automotive space. My background was technology in the automotive space and playing/coaching football. We made a good team because our skills complimented each other, we had the same goals and we actually had a good time doing it.

These 6 things were vital in making DMi a success. We were profitable within 6 months, grew to employ over 30 permanents and 60 casual employees and had a successful exit. We were no carsales or Seek or REA but then again they are no Google or Facebook either.

Nonetheless, we started a business from scratch and made it as one of the 1 out of 10 to succeed. For me, that was pretty successful.


Have you hit your Earning Potential Ceiling?


People pay for value. I love this as it applies to people as much as it applies to services.

What happens when people are getting paid for the value they bring but they want/expect more? It means they’ve hit their Earning Potential Ceiling.

We have a great mentor program at carsales where I’ve been mentoring carsales’ employees for a number of years and it’s been a great experience for me – and hopefully some value to them!

I like to keep our catch-ups real with nothing off limits as I’m there to assist them in their journey.

“you’ve forgotten about what makes you valuable so that you become…..a commodity”

One common topic of discussion is their job tenure and more specifically, whether they should explore new opportunities.

This topic comes up in a number of different ways. Some are ambitious; some want more money; some are naive; some are deluded; some don’t appreciate what they have; and some just don’t have their goals clearly defined.

More often than not it is a mixture of these reasons and quite possibly they tick every box!

One thing I don’t like hearing is that an employee I have been mentoring leaves for another company for a 10% or 15% or even 20% pay rise – and I hear after they have gone.

“Your earning potential is your responsibility”

These young people are ambitious but more often than not, don’t have a plan of building a solid foundation for their future employment.

They can all get more money elsewhere – look hard enough and you will find someone willing to pay you a little more.

Do this a couple of times and all of a sudden you’ve got the pay rises you (think) you’ve wanted but more often than not you will hit your Earning Potential Ceiling.

What does this mean? It means that you have been so busy chasing those incremental increases that you’ve forgotten about what makes you valuable so that you become (or more accurately you have made yourself) a commodity that can be bought anywhere because you are getting paid for the value you are bringing.

Like most things, I didn’t realize the lesson I was learning early in my working life. I was seeing other developers leave for new opportunities which usually was a little more money. Make no mistake, I looked at those opportunities as well, nearly left, tried to leave but for some reason never did.

We had a regular catch-up group of ex-employees and they would tell us how good it was but the next time you saw them a lot had moved on again; it didn’t seem right. Quite a few of them eventually found their way back to where they started, literally (ie more than just the employer).

When I left after more than 10 years I did so to start my own business and build my own experiences. It wasn’t for more money at the time because in fact I wasn’t guaranteed anything – I went without a salary for many months after.

What it did was taught me so many more things in the business world that made me more valuable because of my experiences and of course, achievements.

You don’t have to start your own business to get that experience. You can get it by digging in and being valuable to your employer, making sure there is always a win-win-win there for the company, your manager and of course you.

Your earning potential is your responsibility but don’t think that job hopping for incremental change is the way to enhance this or is at all sustainable because you will quickly find your ceiling.

You need to make yourself valuable because people pay for value. Or you will invariably hit your Earning Potential Ceiling.


Hindsight to be the next carsales


We’ve all talked with friends about super powers and asked each other which one you’d want. Mine would be the power of hindsight.

In my post The Hard Decision carsales had to Make, I talked about the leaders of Reynolds & Reynolds Australia using sound business acumen to make the right decision in persevering with carsales as a startup (it is now an ASX Top100 company with a market cap of ~$2.5b).

One of the learnings they used was the decision of Reynolds & Reynolds Inc out of Dayton, Ohio, to sell DealerNet.com in favour of being a business partner to Microsoft’s Carpoint.com.

Reynolds acquired DealerNet.com in 1995, the same year Autobytel was founded, and was one of the first online automotive classified sites in the US to list used cars. It was described as a “pioneer” in bring dealers to the Internet.

An article in Automotive News (26 June 1995) said ” DealerNet allows a computer user to hook on to the World Wide Web to get information on current car and truck models…..a consumer can get further information and even negotiate a deal via E-Mail – without ever stepping foot into a showroom”.

Reynolds was ahead of the curve with DealerNet.com with current day online heavyweights Autotrader.com and cars.com starting in 1997. Today each of them are worth billions of dollars as a couple of the leading online automotive classified sites in the world.

In the same year that these two now internet giants started, Reynolds sold DealerNet.com to The Cobalt Group so that it could focus on it’s non-equity strategic partnership with Microsoft’s Carpoint.com which was launched the previous year (1996).

When you look back now, this was a pretty big mistake no matter which way you look at it and would have been realized early.

So why did they make the decision to sell DealerNet.com?

Automotive News at the time said that Reynolds wanted to sell it to focus on its relationship with its new partner, Microsoft CarPoint.

They quoted the Reynolds director of online services saying “With CarPoint, we’re better able to fulfill our mission of linking dealers to buyers”.

The irony with this comment is that DealerNet.com, Reynolds had exactly the same assets as what Reynolds Australia had with carsales – they were the number 1 dealer management system provider to franchised new and used car dealers in the US.

What they didn’t have was the foresight that Reynolds Australia had – they couldn’t see that Microsoft had started CarPoint because it saw something big. Had Reynolds realized at the time that if this was a big enough opportunity for Microsoft to invest in then instead of taking a back seat and helping them try to build something big, they would have committed to DealerNet themselves.

The other irony is that CarPoint ultimately failed because it concentrated on new cars as opposed to used cars, using Reynolds as the link to the new car dealers instead of using Reynolds for integrating used cars online which is the path Reynolds Australia took to make carsales so successful in Australia.

Microsoft found that it was bloody hard building a profitable online automotive portal. They bet on the wrong horse (new cars).

If Reynolds were able to use hindsight they would have realized that if it was hard for them to build DealerNet.com, imagine how hard it will be for someone outside of the dealer eco system?

We’re never wrong hindsight, I know that but I wonder if there is anyone still at Reynolds who thinks “what if”.


Moving into Jobs Classifieds from Auto


When we started Digital Motorworks (DMi) in Australia in 1999, our total focus was the automotive industry.

This made sense since our experience was automotive and the DMi technology base out of Austin, Texas was developed for the automotive space aggregating inventory data from over 6,000 car dealers in the US at the time.

So how then was our revenue split 35% auto and 65% jobs classifieds just 3-4 years after starting?

It was about pivoting our niche core competency and getting out of our comfort zone, quickly.

Within 6 months of incorporating the company in Australia, we had signed a significant sized contract with a leading Australian media company giving them exclusivity over our data aggregation and normalization services in the automotive classifieds space for the next 3 years.

We were precluded from working with other major media players in the automotive space although there was still scope for more expansion in auto.

Pretty soon after this, we learned that News Limited’s new digital arm, News Interactive, was keen to get all the job ads advertised in all News newspapers around the country seamlessly into their Careerone.com.au website.

Could our data aggregation and normalization services be used outside of automotive? There was no reason why it couldn’t but it was big change to the business focus and to our head space.

We were given some sample job feeds to test and the results were encouraging but News threw another curve ball – the vast majority of ads are encapsulated in a pdf, image or an image in a pdf. Can we extract the jobs from these file types as opposed to a more logically formatted text file?

Long days and nights followed experimenting with OCR (optical character recognition) software to integrate into our systems and the results started to come slowly at first but the samples were encouraging.

Before we knew it, The Times of London newspaper group (a News International company) had heard about our technology and sent us samples to send back. It was starting to move.

Fast forward a couple of years, thousands of man hours, lots of perseverance and DMi was processing display and lineage job ads from every News Limited newspaper in Australia, The Times of London, the UL’s largest educational group TSL Education (UK) and Emap (UK) for display online in searchable formats.

Was this in our detailed business planning that we used to underpin financing and starting the company? Not even close.

It would have been very easy for us to not try our hand at this new business and stick with automotive, after all we were automotive people with automotive technology.

Sometimes stretching your niche core competency is ok as long as you have a handle on the effort versus reward and more importantly, a handle on what it might do to your business good and bad.


6 moves that drove carsales


With carsales turning 20 this year, everyone seems to forget or fail to realise that for the first 5 or so years, carsales was not profitable and was fighting for the number 1 position with a number of (much bigger) players.

carsales had a (seemingly) unique advantage from the outset in terms of access to dealer inventory by virture of starting out of the number 1 dealer management system provider, Reynolds & Reynolds.

This is a snippet from the carsales’ website in February 1998 when there were just 9 dealers online (1 from South Australia, 4 from Western Australia, 4 from New South Wales):

But this wasn’t the silver bullet everything thought it was (some still think it is today funnily enough), things didn’t just happen for carsales though – they happened as a series of good, calculated business decisions that weren’t necessarily popular or seen as the best way forward at the time but each of them were winners.

Who have thought the “I’m Interested” Form would have been so influential:

Here’s 6 influential moves that drove carsales to where it is today:

Private Listings (2000): Despite having a seemingly huge advantage with unparelleled access to dealer inventory, carsales needed to find a way to drive traffic to the dealer’s cars especially since it didn’t have the seemingly huge advantage it’s competitors had – offline marketing presence. It’s leaders understood that “buyers are sellers and sellers are buyers” so if they could attract private listings on carsales these sellers would also be buyers (of dealer cars). Of course the dealers did not agree with this thinking as they were worried that nobody would look at dealer cars if cheaper private cars were also available for sale. We know who was right.

carsales September 2000:

Sell Your Car Until Sold (2002): Most automotive websites around the world are products of media groups, usually newspapers migrating online. Their model for selling was/is “pay me now for this edition, if it doesn’t sell pay me again to advertise again…and so on”. Translated, this means if I do a bad job helping you sell your car, pay me again. This makes sense for a newspaper as there are costs associated with re-publishing each edition but there is no (cost) reason for this model online. When carsales introduced a flat fee to sell your car until it was sold, private sellers lapped it up. It now made sense to sell your car where you are looking to buy.

Lead Model (2002): Like the previous point, the media groups and their online automotive off-shoots were all about sellers advertising their cars “for sale”. If carsales followed this lead, it would be tough to compete as there was no differentiation to its competitors who being propped up by their offline assets. The carsales leaders decided to change the paradigm by moving from “fee per listing” to a “fee per lead” model. Almost instantly carsales changed the currency of online automotive to leads and created a differentiation that helped propel the business. For dealers, the proposition was now not about “advertising” online but it was all about “selling” – the better they worked the leads they were paying for, the better their closing ratio and more cost effective their online “advertising” would be. It was a true win-win-win for dealers, consumers and carsales.

Acquired Trader Assets (2005): For a number of years there was speculation about “who was going to buy carsales”. Yahoo was the first to take a small stake in carsales in late 2000 which they on-sold to Fairfax in early 2005 but for the carsales’ leaders, each inquiry for acquisition was a takeover bid, something they did not want. The approach from PBL and the end result was different as it was about merging the complimentary assets for both sides to get a win-win (one plus one equals three…or ten as the saying goes). carsales acquired the Trader online assets in the deal in return for 41% of the business giving it the number 2 online auto player as well as number 1 online assets in bikes, boats, trucks, machinery, etc. adding an unparalleled depth to the business.

Mediamotive (2009): The move by carsales to create its own direct corporate sales presence was pivotal in the growth of the business around this time. By taking control of the display sales and recruiting seasoned experts, carsales was able to take its product directly to the buyers using analytical data to ensure a premium marketplace. The Mediamotive business has been a show point for carsales to all automotive classified marketplaces around the world such has been its effectiveness in delivering in a results driven environment.

carsales May 2009:

All Car Search (2009): This may not seen significant to some but by including all cars in the one user search was a great success for carsales. Once again they were ahead of curve in understanding that “all car buyers are new car buyers, it’s just some of them are used” (credit to Greg Roebuck for that quote). For the first time a user could search dealer used, private used, new cars in stock and new cars available in the one search meaning consumers who thought they couldn’t afford a new car, were presented with new cars directly comparable to used cars. There was a fear by some that leads on dealer cars would go down if a consumer could directly compare dealer and private seller cars in the one search given dealer cars are usually a little more expensive (to cover warranties, overheads, etc). Well the opposite was true, interest on dealer cars (new & used) increased and a whole new consumer experience was the result, another win-win-win.

Finally
Running an online business like carsales doesn’t just happen, it takes hundreds if not thousands of constant decision making moments (big and small) to ensure it first of all gets ahead of the curve and then stay there.


The Hard Decision carsales had to Make


Very early in in the founding of carsales.com.au, it’s founders had a pretty big business decision to make which had an easy option and a hard option; the answer would have a material effect on its life span.

Here’s a little snippet that I believe is a great example of sound business decision making.

The rise of carsales.com.au was no accident and showed how the leaders at Dealer Management System provider Reynolds & Reynolds (R&R and now Pentana Solutions) were/are extremely astute business people who used business nous and previous learnings to make the right decision to forge what has turned out to be an incredible journey.

carsales grew out of R&R back in the late 90’s leveraging the DealerLink network between it’s dealers to seamlessly collect used car information.

R&R had a choice to make between two alternatives very early in the life of carsales:

The Easy Decision
Was to partner with one (or more) of the biggest media players in Australia to supply inventory as the infrastructure was already in place to collect the inventory and it really was just incremental revenue for not doing a real lot as well working with some of Australia’s largest and most well known brands, which could have been attractive to a small(ish) software house in Mt Waverley.

The Hard Decision
Was to go hard with carsales.com.au which was going into the unknown of competing against these media giants (at what they considered was their “bread & butter”) as a small software services provider.

Here’s my take on two important decision points that drove R&R to making the Hard Decision to turn their back on the media giants and compete against them with carsales.com.au:

1. “If it is this f&@king hard for us imagine how f&@king hard it is for them.”
This quote has stayed with me for nearly 20 years now. R&R had been trying to get dealers to list their cars on carsales.com.au for a little while and the process was a difficult sell even though there was a seamless, automated inventory feed from the dealer’s computer system to carsales.com.au. So when the big media players and newspapers came looking for (exclusive) inventory data deals, the leaders at R&R realised that if it is so hard for us to get inventory with our setup and relationship with the dealers, just imagine how hard it is going to be for them. They realised they had something of real value to build on.

2. They were quick learners.
R&R US acquired DealerNet.com in 1995 and was one of the first automotive sites in the US list used cars (cars.com and Autotrader.com started in 1997). In 1997 R&R sold DealerNet.com to The Cobalt Group so that it could focus on it’s non-equity strategic partnership with Microsoft’s Carpoint.com which was launched in 1996 (an excerpt from Automotive News, 1 December 1997DealerNet was a pioneer in providing dealers with Web pages in the early 1990s. But Reynolds wanted to sell it to focus on its relationship with its new partner, Microsoft CarPoint. ‘With CarPoint, we’re better able to fulfill our mission of linking dealers to buyers,’ said Kevin Distelhorst, Reynolds director of online services).

Fast forward a year to 1998, R&R US knew they had given up something that was potentially huge and missed their first mover opportunity (imagine their grief now, 20 years on when they see carsales.com valued at ~$2.6b). Generally speaking the US market is 2-3 years ahead on the take-up of new technology and/or processes which gives us in Australia an opportunity to learn.

Hindsight is a wonderful thing and it’s easy to say now that the right reign was pulled when the wrong one could have been so easy had the media companies in Australia actually got their act together.

I take my hat off to the leaders of R&R who made it happen.

Note: All views are my own and not those of carsales.com Limited or Reynolds & Reynolds (now called Pentana Solutions)


Careers – Why did you leave?


9 January 1986 marked an important day for me – it was my first day of my working life after leaving school.

Just recently I “relived” my journey from that day and the decisions I made along the way; holidays are good for that (sometimes). More on these decisions further on.

It just happened to be exactly 31 years later on 9 January 2017 when I was sitting in a restaurant with friends including three 17 year old boys (including one of my own) while on holiday in Broadbeach on the Gold Coast when talk turned to what these kids were going to do in life.

With the three of them heading into their final year of high school this year, the discussion turned to how big a year it is for them, that they get a decent VCE score that will enable to have more choices in what they can do at university and/or in the work force, etc.

They asked me how my final year in high school was, what I studied at university, what my first job was and finally how did I get to where I am today.

Immediately I didn’t want to talk about it. I didn’t want them to know that I didn’t do my final year in high school and didn’t go to university (until much later anyway). Why? Simply for me, I believe the professional world has changed and finishing high school with an eye to further education is much more important for these kids; I didn’t want to give them an out.

I didn’t want them thinking “if you didn’t do it and have done ok then it can’t be that important”. So what did I do? I preceded to tell them the whole story – why I left school, why it was different then, what I did, what steps I took and what chances I took.

Did it help them? I hope so. Did it help me? Yep. I actually found it very therapeutic to trace back my steps from my last days in high school, exactly 31 years to the day.

Today with LinkedIn it’s pretty easy to get a quick overview of someone’s work experience path but what we don’t always see and appreciate is the decisions or reasons each takes in each “fork in the road”.

Here’s a quick snippet of some of my big decision points:

Leaving school
I didn’t mind school, my marks were good and wasn’t looking to leave after Year 11 but dad thought that since he left aft Year 11 and had done ok then maybe I should. A job as a trainee computer operator was up at a company a friend of his was at and he “strongly” encouraged me to apply.

I got the job at Idaps Australia and started 9 January 1986 when I was 17 years 42 days old. As a comparison, my son was 17 years 75 days old for the chat described earlier (my older boy was 20 years 44 days old on this day, has completed high school and two years at university).

I must point out that although I started as a trainee computer operator my interest level and/proficiency in computers and technology was very close to zero.

Leaving Idaps
Life as a trainee computer operator (on IBM mainframes) at Idaps was great – 3 weeks of shift work, 2×12 hour shifts every 4th weekend and then 7 days off, again every 4th week. It was during 1986 however, that I found myself at Richmond Football Club at about Round 9 playing in the U19s which then led to me being appointed Captain in 1987. Juggling shift work with U19’s football was ok but as I entered the Richmond senior pre-season I had to make a decision.

I left Idaps (or more to the point I left shift work) after nearly 2 years so I could train properly for football and during 1988 I undertook a Diploma in Computer Programming at the Control Data Institute. This was a 6 month “intensive” course which I finished in August 1988.

On 10 October 1988 I started life as a computer programmer with Reynolds & Reynolds under the tutelage of Greg Roebuck. I was still only 19 years 316 days of age.

Leaving Reynolds
I spent over 10 1/2 years at Reynolds helping to develop, support and grow the best Dealer Management System in Asia Pacific. I got to spearhead some of defining products for the company including parts priority orders which became the building block for us to build CLERA, real time automated parts ordering between dealers. The technology used here then led to real time automated vehicle uploading and not long after that, carsales.

This was around me turning 30 though (this was significant to me for whatever reason) and I was fighting with two lessons from my dad – 1) keep loyal and you will get looked after and 2) if you want get anywhere do it yourself.

It was at this time that a colleague probably saw that our skills matched to do something ourselves. He didn’t talk me into leaving but I highly doubt I would have left without his influence. During May 1999 we started Digital Motorworks in Australia (DMi as it was known) and left Reynolds.

Leaving DMi
Like Reynolds I learnt an enormous amount running DMi from startup. The first 4 years saw me looking primarily after the technology side but with high interaction in deal making. We were acquired by ADP and then my partner left the business meaning I was CEO from July 2003 through May 2009.

DMi grew top and bottom line healthily each year but investment was drying up and we were servicing primarily a legacy environment so I completed a Masters in Business Systems as “personal insurance”. During 2008 I started talking with Greg Roebuck about a range of opportunities at carsales including partnerships, JV’s, etc and finally he said “come and work for carsales”.

I started at carsales on 9 June 2009. Greg Roebuck has announced his retirement this week and Cam McIntyre steps into the chair. I’ve worked directly for Greg for over 18 years so it feels like the start of a new journey and I have lots of unfinished business with carsales under Cam.

In reality, the decisions I’ve had to make in relation to may career have been pretty straight forward compared to many. I’ve never jumped around for more money, there’s always been much more to it. I like it that way.

NB Please don’t associate this post as anything predicating me leaving carsales.


Don’t Burn Bridges


In my blog post “2 Pieces Of Career Advice“, I talked about my father giving me two pieces of advice as I started my working career which I believe have held me in good stead.

There is actually a third one that wasn’t as implicitly said as the first two were but nonetheless was something that has stuck with me – “Don’t Burn Bridges”.

I have a lived through a couple of great examples where I have benefited from not burning bridges where I very easily could have.

Example 1 – Leaving an Employer

I started with Reynolds & Reynolds just before my 20th birthday as a software developer, working hard and gaining trust over 10.5 years to be driving and building some projects in the company’s history that have truly been game changers (ie CLERA for Parts and their Internet strategy incl carsales).

When I decided to leave Reynolds with a colleague to do our own thing, we weren’t popular with the owners, board, executive, etc and then the fact that we ended up working with practically all of carsales competitors heightened any tension that was there (as carsales was born out of the Reynolds business).

Fast forward another 10 years and I found myself with the opportunity of re-joining that same ownership, board, executive, etc at carsales which I ultimately did and now feel once again part of the “inner sanctum” helping them build and run great businesses.

I could have quite easily behaved in a manner in my exit from Reynolds and even further in my competition with carsales that would have “burnt the bridge”. The fact that I (sub)consciously didn’t and acted in respect of this is something I am happy about and has proven to be the right action.

Example 2 – Re-engaging a Client

When I left the employ of Reynolds and started Digital Motorworks (DMi) as described in example 1, the first client we captured was Pacific Access who through their Yellow Pages field force, had visions of an auto classifieds vertical.

Just under a year into a 3 year contract DMi worked with Pacific Access to execute their plan which at that point they concluded it was harder than they anticipated and made the decision to close.

Pacific Access had signed DMi to an exclusive deal over this 3 years and considering we had forgone other opportunities even the short period of the contract, we were not in a position to not exercise our rights of the contract and therefore had to ensure the contractual commitments were met.

Fast forward 8 years and Trading Post (now owned by Sensis, formally Pacific Access) approached DMi to re-engage for our inventory services. The result was a very satisfactory 3 year agreement to provide these inventory services for the Trading Post brand.

Again, the manner in which we handled the contract exit the first time around could have been terminal for our relationship with the business. The fact that it was not is testament to being aware of not “burning bridges” and acting with integrity.

Moving Forward

In reality not burning bridges is not and should not be a conscious decision; you can’t agree or please everyone but the way in which you conduct yourself should be enough that repeat business not be an issue and if it is an issue, it’s probably not your problem!


A Trade In Price is not a Retail Price


One thing the Internet has done to the car sales industry is (even further) blurred the line between a consumer’s view of a wholesale (trade in) price and a retail price.

When I say “blurred the line” I really mean “created an even greater divide”.

What do I mean here? Well, a consumer now has at their finger tips a proliferation of information on cars for sale, not only in their area but all over the country. Even more, this data is updated multiple times a day.

An important part of this information is the price of their car. This is where it is blurred as the car owner can easily see retail prices of the their car but rarely the wholesale or trade in price.

So when a consumer is buying a car from a car dealer and a trade in price is provided for their car, they are hit with “sticker shock” as they are conditioned on a retail price, usually the asking price and not even the sold price, further increasing the gap.

The end result is the consumer chooses to sell the car privately online and the dealer misses out on acquiring a good car to on sell.

carsales‘ Instant Offer goes a way to plugging this gap in bringing trade in cars to dealers as an option for private sellers selling privately.

Instant Offer is a great alternative for a consumer looking to sell their car quickly without the private seller process where our partner, a reputable wholesale buyer, will inspect your car to check that it matches the details submitted online and meets the offer conditions and will then offer you a wholesale price for your car (similar to the price a dealer would offer as a trade in).

While you may be offered slightly less for your car than you would selling through private channels, this is a quick and convenient method of sale which offers you next business day payment. From there the car will usually find itself for sale through the dealer network just like a trade in would.

It’s important to remember that wholesale prices (including trade in prices) will never be retail prices – they can’t be – but like retail, wholesale is negotiable and doesn’t have to be accepted.

At the end of the day it is in an auto verticals interests to ensure buyers and sellers (dealers and privates) have efficient methods to transact on cars in a retail and/wholesale environment.

Dealers and privates need to take advantage of the “network effect” a good online auto vertical brings. That is, the more sellers, the more buyers.


Take 2: Who has the No 1 Auto Classified Website in the World?


carsales is the number 1 auto classified website in the world.

Ok, there, that’s my answer to the common question of “where is carsales?” after my last post Who has the No 1 Auto Classified Website in the World.

How do I make this assertion now? (note: no I wasn’t told or advised to and I don’t feel obliged to!)

The best way I can answer this question is to quote the last paragraph of my last post:

At the end of the day, all of these websites are businesses and we all know that, as my esteemed former colleague used to remind me, “you can’t bank wank” – in other words, making money has to be the overriding measurement.

There you go, carsales is the number 1 auto classified website in the world because of the financials it delivers compared to the size of the opportunity, ie Australia’s comparative size in population & cars sold compared to the UK, US, China, etc.


A close second would have to be Autotrader.co.uk (although it is number 1 in terms of market cap) which has done an incredible job in the UK with others such as Autotrader.com (probably number 1 in terms of revenue), cars.com and Autohome.com (number 1 in terms of traffic) probably there abouts, all being great online businesses.

I could write another dozen posts with a different website in each post putting up a claim to be the number 1

Three areas where carsales is very strong compared to the before mentioned businesses are in private sellers, display advertising and adjacency businesses. These three business units help to make carsales the incredible business it is today.

The private seller business in carsales is an absolute standout compared to the majority of other online auto vertical businesses around the world. This is an area where large general classified business (horizontals) have really taken the space but carsales has managed to get and maintain a strong holding with the Australian consumer because “it works”.

The display advertising business of carsales has been a unique success story that has been able to deliver quality, premium audiences to automotive focused businesses, particularly OEM’s where a proliferation of data from consumers going right through their car finding journey has made it the most qualified advertising medium available.

The adjacency businesses are the newest of the three with the sale of tyres online through Tyresales.com.au, vehicle finance through Stratton Finance and car inspections through Redbook Inspect the standouts. Each of these businesses are partnerships carsales has entered into that leverage the carsales audience while still keeping an entrepreneurial style to ensure they grow as standalone businesses in their own right while delivering value to carsales through smart integrations.

Let’s not forget too that if carsales is doing well then it’s dealer clients must be doing well as it’s business model for the biggest part of its business is directly tied to what it delivers its dealers – leads which leads (pardon the pun) to sales.

The truth is, I could write another dozen posts with a different website in each post putting up a claim to be the number 1 auto classified website in the world.

I won’t do that but it does show one of the reasons to why this is a fascinating space to be involved in.