The Victorian government has abandoned a $1 million plan to steal the StartCon start-up conference from Sydney after protracted negotiations between the two parties failed to result in an agreement.

Minister for Small Business, Innovation and Trade Philip Dalidakis last year trumpeted the deal to liberate Sydney of the conference, which is owned by

But cracks started to appear in the apparent coup back in March, when it was revealed that this year’s event would stay in Sydney. The switch, at least for this year, was too ambitious.

Then, a week ago, the Victorian government backed out of the deal altogether, and shifted its planned funding into other conferences.

The reason? Reportedly, difficulties in the negotiations and, more controversially, an alleged “lack of desire” by StartCon organisers “to implement diversity metrics for the conference”.

That allegation, unsurprisingly, caused a massive stir, and resulted in a scathing blast from CEO Matt Barrie, along with the release of text-based negotiations between the parties.

“The reason StartCon didn’t go to Melbourne this year is because Philip Dalidakis and his team couldn’t deliver on what they agreed upon in a signed letter,” Barrie charged back.

“The Minister and his team tried to re-trade on multiple points including marketing support, and his department were unable to turn around a basic sponsorship agreement in five months despite repeated prodding, to the point of absurdity.

“Absurdity, in that our Deputy CFO got sick of prodding so many times, his emails deteriorated to single question marks.”

On the allegation that the entire deal had been culled over a lack of cooperation on gender diversity targets for speakers, Barrie said “this couldn’t be further from the truth.”

“We have not had a single conversation with anyone from the Victorian Government, or LaunchVic, about gender diversity,” he said.

Barrie alleged that the first mention of gender diversity targets came “out of the blue”, several months after negotiations between the parties had already broken down.

He called the Minister’s allegations “reprehensible” and said that “the StartCon team is upset at being used as a diversity punching bag.”

The next StartCon will occur in Sydney in November. Barrie said it would have around 3000 attendees and be "the biggest" yet.

According to reports, Barrie hasn't ruled out taking the conference to Victoria in the future; but it would be without government assistance.