Jost Stollmann was born to be an entrepreneur.
The son of a Finance Ministry under-secretary and “the only woman car dealer in post-war Germany”, Stollmann was raised to have an appetite for adventure and risk.
It was that upbringing that led him to build and sell a billion-dollar IT services company in the late 90s, pull his five children aged 6 to 14 out of school for two years to circumnavigate the globe in 2002, and move to Sydney’s Double Bay after crashing into a Fijian reef.
“The propensity to be an entrepreneur is either nurtured from family and educational background, or by urgency, need, lack of alternative,” Stollmann told Business Insider Australia. “I’m in the first camp.
“My father convinced me to study abroad; I was the only German studying law at the time in France, so there was socialisation to do unusual things, to take risks.
“I’m nurtured to have that mentality.”
Stollmann graduated from the Panthéon-Assas University in Paris and later, the Harvard Business School, and went on to work for the Boston Consulting Group in Chicago for three years before he was asked to leave. “They said I was too artistic,” he explained.
So he returned in Germany as a 29-year-old in 1984 and founded CompuNet – an IT systems and network integrator that he built into a billion-dollar business with 3,000 employees and sold to GE Capital 12 years later.
Once again, Stollmann found himself in a suit-and-tie culture where he clashed with traditional management and people he called “jerks”.
“I always say when you sell a business, you sell it three times,” he said, referring to the sale of the company to a new owner, the sale of the founder and his team into the new corporate culture, and the founder’s eventual departure.
Stollmann quit GE in September 1997; his wife Fiona, who had worked with him at CompuNet and later GE as a marketing executive, was asked to leave shortly afterwards.
Stollmann was well-known in the German start-up scene, winning him the attention of Social Democratic Party leader Gerhard Schröder who asked him to join his cabinet as Shadow Minister for Economy and Technology.
Although his political views weren’t perfectly aligned with those of the party, Stollmann accepted. “It was clear that Schröder was going to win and instead of bitching in the Senator Lounge of Lufthansa, I said I’d serve my country,” he explained.
But he didn’t survive a power struggle with the “traditional left” and chairman Oskar Lafontaine. Stollmann left the party just days before Schröder formed his government.
“It was a big scandal at the time,” he said. “I went back to promoting the entrepreneurial culture in the community, then we left on our boat.”
Greece-born Fiona Stollmann had wanted to migrate to sunnier shores for some time, and in 1999, the couple started work on a custom-built high-performance yacht that could take the family on a two-year trip around the world.
The family moved onto 130-foot “Alithia” in May 2002 with two tutors and a crew of six.
“We spent the next two years visiting the most remote areas of the planet,” Jost Stollmann said.
“With a sailing boat, you can reach places that are off the beaten track – places where we were the first boat ever, or the first white people to visit.”
The family sailed past South America and through the Pacific before Alithia struck a reef in Fiji. They ended up in Australia, where the ship was repaired.
“It was an undocumented underwater reef – a wall,” Stollman said. “Our yacht was 145 tonnes, moving at 8 knots, and came to a sudden stop.
“There was a lot of cosmetic damage and a big scare, but the German-built aluminium hull – as it turned out, when we surveyed it in Brisbane – absorbed the unbelievable shock and forces, so we were able to continue our circumnavigation after some repair work.”
The Stollmanns visited Sydney while in Australia, and Fiona was particularly impressed by private schools in the eastern suburbs.
Their two-year itinerary ended at the 2004 Athens Olympics; when that was over, the Stollmanns moved to Double Bay and have lived there since.
The Sydney CEO
Stollmann is now CEO of payments start-up Tyro, which was founded by ex-Cisco employees Peter Haig, Andrew Rothwell and Paul Wood in response to a Reserve Bank push for non-bank innovators in the payments industry.
As a husband and father, he has nothing but praise for his new home city. But as an entrepreneur, Stollmann has found the city lacking.
Australia’s geographic isolation and market size meant that most business opportunities required Stollmann to travel extensively without his family, which was not something he was willing to do.
He finally met Tyro’s founders through venture capital fund manager Roger Buckeridge, and was disappointed again when he realised how hard it was to raise capital for an early-stage business in Australia.
Of the total $33 million invested in Tyro, Stollmann has tipped in about $8.5 million and might have contributed more had shareholdings not been limited by Australia’s Financial Sector (Shareholdings) Act.
Capital raising was particularly difficult for Tyro, whose revenues – like those of Visa and Mastercard – come from taking a small percentage of the payments that go through its systems.
Put simply, the business ran at a loss until it gained enough traction. Tyro reached a peak loss of $28 million before finally breaking even in March 2012 – numbers that were unlikely to appeal to number-crunching funds.
“My experience [with capital raising in Australia] was disastrous,” Stollmann said. “Early-stage growth capital doesn’t exist.
“I had to collect it from certain high net worth individuals and I put my own money in. Imagine what it’d be like for normal start-ups.”
Tyro’s investors now include former Westpac executive David Fite, former Bankers Trust chairman Rob Ferguson, MYOB founder Craig Winkler and Atlassian co-founder Mike Cannon-Brookes.
It will be Stollmann’s second big break, he says, noting that potential investors and business partners have come knocking now that the tougher, early phase is over.
Stollmann says he has no regrets about moving to Australia but hopes – for the nation’s sake – that the entrepreneurial environment improves.
He expects at least one of his five children to follow in his footsteps, given their exposure to change, risk and living outside of the box.
“I have an opinion in general: the future is entrepreneurship and the only asset class with significant returns is entrepreneurial investments,” he said.
“It’s a no-brainer; we’ve only seen the start of disruption and it’s going to touch all industries, all sectors, all countries.
“We like [our children] to leave Australia after the HSC to study abroad, they don’t just learn their subject but another language, culture, and they’re on their own to navigate uncharted waters.
“It’s good to prepare the younger generation to take calculated risks, to move around, to spot opportunities, to handle failure.”
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