





Mahesh Sharma



Australian start-up Ninja Blocks has secured $1 million from investors to build a killer app to propel the remote controlled home into the mainstream consciousness and spark the next technology revolution where anything can connect to anything.

The company was laughed at by investors in Australia when it proposed a $500,000 round of fundraising based on a company value of $2 million. Investors in the United States later said the company was undervalued.

The Ninja Block is a hardware device that detects changes in the physical environment and wirelessly sends the information to the online Ninja Cloud, a set of software applications that allow users to control wireless-enabled devices and appliances, or upload content to social media. Movement, light, sound and pressure sensors can be attached to the Ninja Block to, say, trigger a webcam to take a photo and upload to Facebook. It could be used to turn on other wireless-enabled devices such as door bells, lights and air-conditioning.

The start-up began 18-months ago on the back of $20,000 in savings "and a little bit out of the mortgage".

In an interview with ITPro, Sydney-based co-founder Marcus Schappi revealed the company raised $1 million from a syndicate of eight angel investors and two venture capital firms, including Guitar Hero founder Kai Huang and Atlassian founders Mike Cannon-Brookes and Scott Farquhar. The funds were secured in April after a three-week tour to the US which involved pitches to Silicon Valley and New York investors. The tour was part of the start-up's participation in the Startmate accelerator program.

Before flying to the US, investors in Australia had laughed at the "huge numbers" Schappi proposed: a $500,000 investment on a $2 million company valuation. Investors in the US later told him the company was undervalued. More than 50 angel investors expressed interest via the US investor network AngelList where it was the 'trending' start-up. In the end, US-based Australian investors made up three quarters of the angel funding.

"There is money there you just need to be able to mobilise it," Schappi said. "They're very gung-ho in the US, and more realistic as to how start-ups work. Over here it's: 'do a big 20-page business plan, and present that to somebody'."

Last week co-founders Marcus, his wife Madeline Schappi and Peter Moore shipped the first batch of 650 Ninja Blocks sold via a Kickstarter crowdfunding campaign that generated more than $102,000 in March.

The gadget's electronics boards are soldered and assembled by hand in the company's offices at the Australian Technology Park in Sydney's Redfern. The plastic cases are manufactured at Schappi's home by Madeline where three 3D printers run 24 hours a day. One case is printed every hour.

Ninja Blocks has established relationships with manufacturers to produce large quantities of the device, and Schappi said distributors were very enthusiastic to make the device widely available in retail outlets.

He said Ninja Blocks could be a home security device, could track energy usage in the home by connecting with different appliances, and even monitor the health of a baby including his own on the way.

"We did maybe 60 meetings in the US and they all asked 'what's the killer app?'," Schappi, who is also a mobile app developer, said. "I don't think we've seen it yet."

"I'll monitor my children with it. My wife has bought a big sudden infant death syndrome monitor which has a breathing sensor. That's all information we can pipe straight into the Ninja Block."

"With Bluetooth 4.0 we can trigger an alarm when the child moves out of range, or it can tell you when the children are at home."

twitter  Follow IT Pro on Twitter

46 comments so far

  • Australia will never get it. This is the reason so many inventions over the 20th century went offshore to the United States.
    Australian governments aren't open minded. E.g. the current idea of innovation within the Labor party is taxing mining companies.

    Date and time
    July 13, 2012, 11:32AM
    • Yes AM, this is a partisan politics issue isn't it. Presumably you're looking forward to the super-progressive Tony Abbott to take the reins?

      You can blame industry, not government. Our governments are more progressive than US governments but their industry people leave ours for dead.

      Date and time
      July 13, 2012, 1:30PM
    • The media has a hand in it as well, when articles are referring readers to overseas companies when there are start-ups here that do the same thing, what hope is there?

      SMH itself has published a number of advertisements as thinly veiled e-commerce articles which sends Australian businesses to Canada rather than using Australian companies.

      Journalists (or those writers posing as objective journalists), should be just as accountable as the government and dinustry leaders.

      Date and time
      July 13, 2012, 2:09PM
    • You people can't read. AM said "Australian GOVERNMENTS (plural) aren't open minded", he then gave an example of the CURRENT government. Nowhere in his comment did he venture down the path of a partisan slanging match. That came from you morons who can't read

      Date and time
      July 13, 2012, 4:21PM
    • @Laki, you're mistaken. The removal of tax breaks on equity by this government destroyed the means to which 'start-ups' could fund their own growth. Now they're left paying tax on income that hasn't even been earned yet. That's why companies move to US and it has nothing to do with industry.

      Date and time
      July 14, 2012, 8:54AM
    • @Batty - you are very wrong. It is so easy not to pay any tax on equity incentives it is not funny. It is just as easy now as it was before (methods that worked then still work now). You just need to use someone who knows what they are doing. If the entrepreneur can't get reasonable advice and know what they are doing then they have other issues to deal with.

      It has nothing to do with companies moving to the US, and in a lot of cases that won't even change anything. People fail there just as much as they do here.

      Why do people always complain about things not being fair, or problems/difficulties are due to other people rather than themselves?

      Stop complaining
      Date and time
      July 15, 2012, 1:41PM
    • Ideas and the money derived from them are a very interesting topic. I suppose the most compelling thing about it (money) is its perceived value. At the end of the day, it comes down to priorities.

      As far as U.S. Governments role in creating a business friendly environment, that is pretty much a no brainer - one only need to look back over the last 50 years to see where the technological developments have come from and the U.S. is a stand out without peer.

      Most of that has to do with the States ability to understand infrastructure where the Australian Government is fairly ambivalent and actually think that business should create its own. I would point to that as the major differences between the two counties, and in some ways it is a huge hurdle for Australia.

      Date and time
      July 16, 2012, 5:24AM
  • Congratulations guys!

    John Boxall
    East Coast
    Date and time
    July 13, 2012, 11:43AM
    • Great idea!

      Good work, well done.
      Could you integrate a universal remote too, for us who don't have Wifi enabled airconditioners?


      Date and time
      July 13, 2012, 3:29PM
  • Good for him!

    Date and time
    July 13, 2012, 12:05PM

    More comments

    Make a comment

    You are logged in as [Logout]

    All information entered below may be published.

    Error: Please enter your screen name.

    Error: Your Screen Name must be less than 255 characters.

    Error: Your Location must be less than 255 characters.

    Error: Please enter your comment.

    Error: Your Message must be less than 300 words.

    Post to

    You need to have read and accepted the Conditions of Use.

    Thank you

    Your comment has been submitted for approval.


    Featured advertisers