Stephen Rutter, founder of The Scale Institute and Head of Community, Neutopia has always been passionate about helping small business and entrepreneurs, however after visiting Hobart’s Art & Culture Museum five years ago a new purpose unfolded for Stephen – To create opportunities for indigenous entrepreneurs and small business leaders.
In this conversation, Stephanie Christopher and Stephen explore the similarities and differences between Indigenous Entrepreneurship and Western Entrepreneurship and the need to apply open innovation principles for the next horizon of growth.
Critical to success is bringing the two worlds together, find out how all business leaders can take that first step.
Stephanie: Welcome to TEC Live, Stephanie Christopher here, CEO of The Executive Connection. We connect leaders with a trusted network of people who help them succeed.
Leah: Without giving away who the guest is, this is a carryover champion, but Steph, it’s going to be a really different conversation this week.
Stephanie: It’s going to be a really interesting conversation this week, and I can guarantee it, because it is my favourite all time podcaster, Stephen Rutter.
So, let me tell you about Stephen. He is the founder of an amazing company called The Scale Institute. It’s an innovation consultancy that has done so much for various businesses, clients, educational organisations across Australia, large corporates and SMEs.
But today, we’re going to focus the conversation on Stephen and his own story, his journey to realising his Aboriginal heritage and who he is today. A proud Tebrakunna man from Lutruwita in Tasmania. Stephen Rutter, welcome to TEC Live.
Stephen: Thank you, Steph.
Stephanie: So good to see you in your Scale Institute hoodie. One thing, you do very good merch.
Stephen: Do we have a camera here, because that’s where I try to sell my brand.
Stephanie: We will definitely get a camera and with your Dresden glasses matching your hoodie, you’ve got the look, definitely.
So, Stephen, you’ve been on TEC Live right at the beginning. You were one of our first guests talking about innovation, design thinking, agility, radical candor. It was a good conversation, but today I really want to talk about the story you told me maybe 12 months ago and it was about a fundamental change in your life, so why don’t you start at the beginning and tell your story.
Stephen: Yeah, sure. So, I think I got to get back to about 1987 when my auntie took her two-day-old or three- day-old into hospital in Canberra and got told it was croup. Took him home and he died overnight.
So, my mum got my auntie out of bed and took her down to the library and wanted to map our family tree. And my mother and my auntie found out our extensive family history that absolutely took us way back to the early 1800s in Tasmania, or at the time was called Lutruwita.
Stephanie: And did they have any idea of this history?
Stephen: Not at all. Not at all. They were quite, I guess, ambivalent to their past. They knew that there was convict heritage and that’s all we were told as kids, that we were good old convict stock.
Stephanie: I would’ve picked that straight away with you, Stephen.
Stephen: Thank you. Must have been all those pens and pads I stole from The Executive Connection.
Stephanie: Totally, totally, so then what happened?
Stephen: So, they went on a journey and Ashley found out that a farmer that was in Tasmania married the granddaughter of an indigenous elder. And he was actually the Chief of Tebrakunna Country, which is right at the tip, so the northeast corner of Tasmania, looking out to the Bass Strait Islands.
Stephanie: Right, northeast corner, so what’s that, Launceston, but much further over?
Stephen: Yeah, absolutely. I actually went on to country a couple of months ago and it’s about two hours drive from Launceston.
Stephanie: So, paint the picture then about the granddaughter, so your great, great…
Stephen: About six times great. So, she was born to Dolly and Dolly was sold off to the seal fishermen at the time. And Jane, her daughter, got sent to Launceston to live with a doctor’s family, which was great, she got an education, she got to read and write.
However, then Jane was, again, outcast from that family, because of a somewhat suspicious illegitimate child. And we’re not sure if it’s the doctor’s or not, but that might be a folk tale. Basically, at that stage, Jane and Thomas, one of my relatives, got married and started a hobby farm.
Stephanie: And so, Thomas would’ve been a white farmer, was it?
Stephen: Yep, he was a son of the convict that first came out.
Stephanie: Yeah, right. This is a pretty amazing story to come across. What did that mean for your mom and your auntie?
Stephen: My grandmother was still alive, and she didn’t want to tell anyone. And her sisters, so they had four sisters, didn’t want any of the family to know, so it was quite suppressed for about 15 years until my grandmother passed away.
And then along the same lines, my grandfather, so my grandmother’s husband, they were tracking a 40 year journey of their family tree as well that also had indigenous origins.
Stephanie: On both sides?
Stephen: On both sides.
Stephen: That was quite special, but I think it’s really only been in the last 10 years that I’ve been able to research a lot more into it, spend a lot more time down in far northeast Tasmania and getting an understanding of how great my family is.
And I think I’ll reflect on five years ago, I went down to the Tasmanian Art and Cultural Museum in Hobart and we got there right on nine o’clock, because we had a reservation at a nice restaurant a couple of hours out of Hobart for lunch and then flying out that day. And we got there, the older gentleman said, ‘What are you here to see?’ And Ritheo, my loving partner, blurted out, ‘We’re here to see Mannalargenna,’ so the chief.
And he said, ‘Well, you’ve come to the right place. He’s everywhere.’ First of all, go to the third floor and we go up in the elevator and you open the doors and a big mural of his sits. And subsequent to that, there’s six other, maybe four foot by six foot paintings of Mannalargenna everywhere. He was a provocateur and I’ve told you about me before and how I like to help individuals and organisations think differently, but he was engaged by the Tasmanian Government to form the Black Line in…
Stephanie: Just interrupting, he was the chief of the whole area that is now Tasmania?
Stephen: No, just of Tebrakunna.
Stephanie: But this museum in Hobart obviously is the museum for the whole state?
Stephen: That’s exactly right.
Stephanie: Sorry, I was just getting my countries. Tell me about the Black Line.
Stephen: Over 18 months, the budget was half of the Tasmanian overall budget to form this line to basically corral and relocate every indigenous man, woman, child, and relocate them to the Bass Strait Islands.
Stephen: Flinders Island.
Stephanie: And when are we talking here, 1800s?
Stephen: And it was 1832. He was employed for a couple of years and over the course of his supervision, they found one man and one boy.
Stephen: So, he basically kept taking Augustus Robinson, who was a Lieutenant General down there at the time in circles, kept asking via smoke signals and messages for the locals to keep moving.
Stephanie: Keep moving.
Stephen: And that lasted a good couple of years, so he was found out. He just went back to the Lieutenant General and said, ‘Would you like me to tell your superiors what you do?’ And anyway, they didn’t like that, so they shipped him off and he died three months later on Flinders Island.
Stephanie: What an amazing story. And Jane was his granddaughter?
Stephen: Yeah, that’s right.
Stephanie: Tasmania was terrible. It was terrible and terrible things done all around this country, but Tasmania was particularly brutal, wasn’t it?
Stephen: Yeah, and I think that’s due to its island state. I mean, they just can’t keep running.
Stephanie: And so, what did this mean for you? So you’ve said five years ago you were at that museum, this has unfolded for you, hasn’t it, into becoming deeply part of your psyche?
Stephen: Yeah, I think it’s down to purpose. I grew up in a very white family. My father was a small business owner, so didn’t have any holidays. He worked really hard, but he got rewarded for that. So yeah, I’m privileged. So, the journey I’m on now is to give every opportunity I can to not just First Nations peoples, but everyone.
Stephanie: Well, you have inherited provocateur through all those lines, through that history, there’s no question about that and you are driven to help small and mid-size businesses, so tell us about First Nations businesses, particularly small businesses in Australia. What’s the status or the state?
Stephen: So, I registered the Scale Institute as an Indigenous Corporation last year and I got my ICN.
Stephanie: Oh yeah, that’s right, I was going to ask you about that.
Stephanie: Tell us about that.
Stephen: So, it’s an indigenous credit number, so think ABN and my number was 9658.
Stephen: If you can think of your ABN…
Stephanie: Yeah, yeah.
Stephen: There’s a lot more numbers, right? So, on paper, less than 10,000 businesses that identify as 51% or more indigenous, which means we’re sitting well below equity of 3% to allow for an equal seat at the table.
So, I did the maths and it’s 80,000 businesses that we need to get a fair representation for the voices, the culture, the purpose and the sustainability of our people. So, there was in COVID a lot of grants given from the state and federal governments to reinvigorate communities and I put together a proposal for a First Nations Business Academy, which wasn’t successful.
They wanted a shiny toy. They wanted these ideas of out of the bush that they could put on a pedestal, typical innovation theater and what I wanted to do was to create a steady flow of indigenous entrepreneurial thinkers. I don’t teach entrepreneurship, I don’t teach innovation, I help people to think differently and act entrepreneurial.
So, we’re identifying that in the last five years we’ve done a great job. We’ve got reconciliation action plans, which people are now moving away from. We’ve got indigenous procurement policies, we’ve got enough demand, we just don’t have the supply. So, where I come from, from the entrepreneurial ecosystem and even with my own early stage venture utopia, we’re fighting for product market fit. We’re fighting for those customers, whereas indigenous businesses already have a great unfair advantage, we just don’t have the supplier.
Stephanie: Yeah, isn’t that interesting? So, the network effect exists, which is how any startup can really scale.
Stephanie: Are those less than 10,000 businesses leveraging that network and doing very well?
Stephen: No, I think there’s some cultural nuances at play here. We were still very fragmented in our own nations and countries and collaboration could be seen as business across the board. Do we collaborate well with our friends and foes? Do we take an open innovation approach and know that one plus one equals five? No.
Stephen: We still don’t do that in business across the board. So, I think we need to herald successes a lot more. And this goes to entrepreneurship across the board. We’re still knocking Elon Musk off his perch, because of his idiosyncrasies and I think we need to applaud people taking risk and we need to also then create the safe environments for people to fail.
Stephanie: So, as a step one then, to find a way that all businesses can celebrate these stories of First Nations businesses, entrepreneurs that are making a difference.
Stephen: I think step one is to collaborate. I think step one is to not think of ourselves as First Nations businesses or western businesses or Australian businesses that we’re just here and we need to join forces to actually maintain and move to the next horizon of growth, because of the whole disruption happening around us.
Stephanie: Absolutely, so what would that collaboration specifically look like then as a first step? What could it look like?
Stephen: I think in its purest form, it’s sharing ideas, sitting down, getting back to storytelling yarning, getting back to just an ability to know that we have very similar challenges in business. You know this all too well.
Stephanie: Whatever kind of business you’re in and whatever your family background is.
Stephen: And your business, Stephanie, is built around that knowledge sharing, so how might we actually just look at an indigenous business that might have an average revenue of $800,000 and go to an equivalent SME that averages $1.5 million and just ask them how and why.
Stephanie: It’s really interesting. My mind’s racing actually about what we could all do in business. So, you are talking about collaboration, there’s a step before that though, because people have to actually know each other to collaborate.
Stephen: Yeah, that’s right.
Stephanie: So, there has to be some connection first.
Stephen: Yeah, so I’ve been working with some education providers such as Enactus Australia and also some schools have bought into this as well. Enactus Australia just focus on social innovation projects that are student led in the tertiary system.
Stephanie: Yeah, yeah.
Stephen: And they asked me to develop a module of collaborating with First Nations people. And I had a brief, no more than two and a half hours, so I did four modules and I started with the cultural bias, the awareness, and what you may think and what you don’t think.
Then I moved into storytelling, indigenous entrepreneurship and the last was communicating for impact, so I really looked at that four pronged approach and you know me, it starts with the user. It starts with the empathy.
Stephanie: And who was your user for this?
Stephen: Oh, the First Nations people.
Stephanie: Oh, it was for First Nations.
Stephen: It was for the university students wanting to work with communities.
Stephanie: Yeah, that’s right, that’s what I was trying to think, who was the persona of your first course.
Stephen: That’s right.
Stephanie: Because, I mean, those four areas, that’s kind of getting back to where we can all start as businesses, so say the four modules again, because they’re really good.
Stephen: So, cultural bias.
Stephanie: I love that, yeah.
Stephen: Okay, storytelling.
Stephen: Indigenous entrepreneurship.
Stephen: It’s so different to entrepreneurship as a discipline. And the fourth is communicating with impact.
Stephanie: Okay, let’s touch on some of those, because I think this is really getting into it. Tell me about cultural bias, what are the cultural biases, plural, that I’m sitting here holding that I need to be aware of.
Stephen: That someone won’t stick around if you employ them or if you contract them to do some work for you.
Stephen: Because we take a lens that we’re hunters and gatherers and we are nomadic people, so we’re going to go walk about.
Now, if you take Dark Emu for example, if you’ve read Dark Emu, if you haven’t, go read it, and you see that First Nations people built cities.
Stephanie: That’s interesting. So, that bias, I don’t think I hold that bias actually. And in the great resignation… I probably do hold it, about employees under a certain age and it doesn’t bother me, because that’s the world that I live in right now, so that’s interesting challenging that one.
I want to know the difference that you see between Aboriginal entrepreneurship and western entrepreneurship.
Stephen: I think it’s about collectiveness, so indigenous entrepreneurship is all about talking through the problem with others first, whereas the entrepreneurship that I first learned about at my time at UTS and I developed an MBA in entrepreneurship was all about, well we need to keep it close to our chest, we need to have it for our own personal gratification, even though we might be solving a big problem that the market has identified, it’s still a singular ownership, whereas indigenous entrepreneurship is about community ownership.
Stephanie: Community. Yeah, that’s really interesting. And then tell me finally about communicating with impact, what’s the key messages there?
Stephen: I think it’s asking the right questions. You know yourself, as a world class podcast interviewer, it’s about just unlocking the hidden truth.
Stephen: Because we all have our facade, we always have a hard time looking at ourselves in a self reflective way, so I feel you need to do all the previous steps and really understand your user group to then unlock and ask the right questions, because that will drop down the opportunity.
Stephanie: You have come from two worlds and one world you assumed you were from and then there’s been this whole other colour added to who you are. And when I’m listening to you talking about those two worlds as far as entrepreneurship goes and disruption and innovation, they actually merge beautifully and I think that’s a message for business here, that there’s been this whole school of entrepreneurship and this is how you do it, start with the user, but actually you’re bringing in a very powerful next level of context and content that can make a huge difference for entrepreneurs trying to be successful.
Stephen: Yeah, I think it really is down to mentorship, to be honest. And when I created this business academy that is yet to take off the ground, so if any of your listeners do want to put some seed funding into it they can reach out to me. But it’s more about, I really wanted to focus on how the idea stays within the community.
So again, the way I’ve built innovation ecosystems in the past is to have these entrepreneurs in residence, the types of people that are the Ben Groziers, they’re just wonderful, because they come from a world of experience. The TEC Chairs, they come from a world of experience and deliver, not the answers, but just some sage advice.
And I really wanted to bring in the cultural elements, so I’ve brought in these elders in residence that, again, are not there to provide business acumen or the components of a business model, but just to make sure that not only does that First Nations entrepreneur stay within community, but is on the right lane.
Stephanie: I know you’re onto something, Stephen, and there’s a way of shaping this, because critical to success is bringing both of your worlds together.
Stephen: I think so.
Stephanie: Finally, what’s your message then for the larger group, western is the term, I heard you use it, which is why I’m using it, western SMEs, what’s the message here for the opportunity and what action do you want people to take?
Stephen: Really good question. I think the opportunity is twofold. I think the average age of our entrepreneur in Australia is 38, 39, so they don’t get out of high school or university with their hoodie on and in their parents’ garage or whatever.
So, entrepreneurs need to go through and get their training wheels through businesses. And so, I think it’s, first of all, take that chance. The unemployment rate for First Nations youth is still far higher than none, so I think we need to ensure that we’re not seen as different.
And again, I build programs for other multicultural organisations as well. First generation refugees and migrants, because again, I see myself as Australian and so I think it’s provide the same opportunity you would to…
Stephanie: For your natural, so it comes-
Stephen: To Thomas Herbst, a farmer in Tasmania that married Jane.
Stephanie: Yeah, lovely. That’s a nice way to put it. And I’m going to bring it back to a word that you said before and that word was bias and that’s where I think it is as well, to really understand your own cultural bias and hopefully this country is at a time right now where we’re all open to doing that.
And Stephen, your story is so impactful in such a multilayered person to have this whole element that you can add to everything you bring to business in this country. And thank you very much for sharing your story and thank you for joining us on TEC Live.
Stephen: It’s my pleasure, Steph, thank you.
Stephanie: Discover more about TEC at tec.com.au.