Afterpay’s growth ‘easier in Australia’

Co-founder Nick Molnar says Australian retailers were far more receptive to buy now, pay later than their US counterparts.

2/6/20: Nick Molnar, CEO of Afterpay at Bondi Beach. John Feder/The Australian.

Hello and welcome to The Download, The Australian’s technology blog for the latest tech news.

David Swan 3.45pm: Afterpay’s growth ‘easier in Australia’

Afterpay co-founder and co-CEO Nick Molnar says the his red-hot buy now, pay later provider signed up retailers in Australia to its platform far more easily than in the US due to key cultural differences, revealing the trials and tribulations of taking an Australian company overseas.

Speaking to author and professor Scott Galloway for ‘The Prof G Show’ podcast, Mr Molnar, who returned as co-CEO last month, said that Australia’s culture is about ‘giving things a go’ and supporting the underdog, which makes for fertile ground for tech start-ups.

“The embracing by retailers in Australia was a lot easier to unlock than what we did in the US,” he said. “If I look then to moving to San Francisco and building a team in San Francisco, we’ve never been in TechCrunch. That’s not what our business is about. We work with Womenswear Daily and Retailers of Fashion. We are where our retailers sit.

“We had to find the right people who were the right blend of science and art. Retail is art. Why does someone buy a beauty kit, or a pair of jeans? There‘s a lot of psychology that goes into that decision. We hired slowly in San Francisco, and we’ve now got a team of about 200 on the ground within two and a half years of being there. But I’d like to think that we’ve built as much of a culture that is similar to what we have in Australia, in North America.”

Mr Molnar, who earlier this year became Australia’s youngest self-made billionaire, added that while there’s a lot less competition for Afterpay in Australia, the local economy is overall still small. He said this year for Afterpay, US Black Friday sales were greater than those in Australia for the first time.

“When when I‘m speaking to Australian entrepreneurs, it has to be about Australians going global to really create that opportunity,” he said. ”The top 10 companies listed on Australia on the Stock Exchange are the exact same top 10 companies that were there 30 years ago; it’s banks, mining companies, property companies. And so that speaks to actually a lack of entrepreneurship, but it also speaks to the size of the market. You have Atlassian, you have Canva, you have some amazing Australian entrepreneurs now starting to go offshore. And, you know, when we first announced that we were going to go from Australia into the US, our stock went down, you know, people are ’here’s another Australian organisation trying to go global’.

“And then when we landed in the US, it was kind of like, well, you know, you weren‘t, you weren’t founded here, can you succeed?’ And, you know, both those things were really interesting to go through and to unlock.”

Chris Griffith 12.00pm: Experts back digital health certificates but there are questions

Australian health experts are optimistic that digital vaccination passports can help provide a safe environment with some resumption of normal overseas travel, possibly by mid 2021.

The digital vaccination certificate – a modern take on the little vaccination book carried by some children and commonly used decades ago – would provide a way for foreign countries to keep track of the vaccination backgrounds of incoming international travellers, and a way for airlines to provide a safer in-flight environment.

Qantas has said that it will make vaccinations mandatory for those flying overseas and it is reported that the airline is working with the government and other carriers about the form a digital vaccination passport will take.

The World Health Organisation also is looking at the possibility of electronic vaccination certificates/passports as pharmaceutical companies get ready to roll out the first vaccinations.

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David Swan 10.35am: Kogan whacked with fine

Online retailer Kogan has been fined $350,000 after the Federal Court found it breached Australian consumer law with a ‘tax time’ promotion in 2018.

In proceedings brought by the ACCC, the court found Kogan‘s promotion to be false and misleading. The retailer offered a 10 per cent discount with the code ‘TAXTIME’, but had increased the prices of more than 600 of its products immediately before the promotion.

More than 10 million Kogan customers were sent emails and 930,000 were sent text messages promoting the sale.

“We brought this case because we were concerned that the advertised price reductions were not genuine savings,” ACCC Chair Rod Sims said in a statement.

“Many consumers who took up the offer on one or more of the 600 or so products in many cases actually paid the same as, or more than, what they would have paid immediately before and after the promotion.”

The ACCC had been seeking a $2m penalty.

Kogan was fined $32,4000 four years ago for similar conduct regarding a Father‘s Day promotion.

Last week Kogan agreed to pay $122.4 million for one of New Zealand’s leading online retailers Mighty Ape.

David Swan 10am: World first for ‘ethical AI’

Workforce intelligence platform Reejig says it has accomplished the world’s first and only independent assessment and validation of ethical AI, in partnership with the University of Technology Sydney, as debate over the AI and ethics continues to rage.

Reejig chief executive Siobhan Savage said this process was the first time that algorithms within an AI-driven intelligence platform had been independently assessed against ethical criteria of transparency, privacy, bias and accountability.

“The benefits that data and AI are bringing to the professional workforce are phenomenal, but AI is not immune to bias in the data or in the algorithms. Previously, the decision making has been hidden in a black box, meaning until now, there has been no clear, defensible, independent, and objective validation demonstrating ethical AI.

“Frameworks provide guidance however we believe that’s like marking your own homework. Boards, organisations, and decision makers are exposed to real risk that they may unwittingly be causing harm or bias. Given what’s at stake, we were astounded that there was no independent assurance that the AI an organisation adopts is ethical and unbiased.“

UTS distinguished professor Fang Chen and UTS partnered with Reejig on the platform, to deliver the ‘non-biased talent short-listing algorithm validation’ project.

“When you are talking about AI and workforce or HR data you are dealing with sensitive information about real people, so building trust into that process is critical. Combined, these two have the power to transform the way we think, engage and work. AI for good needs to be the standard. But there has been no way to properly assess that until this project,“ Professor Chen said.

As The Australian reported last month bias in AI is looming as a significant issue for Australian businesses, according to Human Rights Commissioner Edward Santow, who has launched a new technical paper offering practical guidance for companies to ensure their AI systems are fair, accurate and comply with human rights.

The issue is also in the headlines after a prominent artificial-intelligence researcher says she was fired by Google after she refused to retract a research paper and complained about the company in an email to colleagues.