Australia is a blessed country. We have some of the world's most liveable cities, beautiful landscapes and weather, excellent education, and a strong economy. It's a great place to live and work and raise a family. More, we are a nation with a strong entrepreneurial spirit and a keen love of technology. So, it's a great place to create and build a company.
We are a beacon and an entry point in the Asia-Pacific region, and while our population isn't quite as large as other developed nations, we live in the age of the internet where companies sell and compete globally even while operating locally.
However, when it comes to institutionalised knowledge, investment opportunities and talent, it's tempting to fly the coop and build a business overseas. With hubs like Silicon Valley offering so much possibility, it's clear why many an Australian entrepreneur has found success in the US. We recently travelled to meet some of them and, at an event held alongside CES just last month, we launched the Rockstar Aussie Founders report with the Aussie Founders Network (AFN) showcasing just how talented, resourceful, and quite frankly brilliant, Australians can be.
It's often been said that we need an equivalent of Silicon Valley here in Australia, but this is the wrong answer to the right question: how can we foster Australian start-ups to build, and importantly grow, their fortunes here? How can we enable the current ecosystem such that we grow, attract, and retain all the talent, knowledge, and experience here and thereby fuel future start-ups?
The benefits are clear: according to research from PwC, start-ups have the potential to contribute over $100 billion to Australia’s GDP and create over half a million new jobs by 2033. Technology companies especially can have enormous economic impact – they lead the rankings of world's largest public companies and include names like Apple, Google, and Microsoft that we're all familiar with.
The Global Startup Ecosystem Report 2018 by Startup Genome – one of the most comprehensive studies ever undertaken of start-up ecosystems – notes that of the trillions of dollars of economic value created by technology companies, much of this growth is driven by start-ups. Meaning, with the right support environment, there is every opportunity to leverage this potential for economic growth and job creation in Australia.
The good news is that we have a head start. The same report, that covers hubs from Silicon Valley to Bangalore, reveals that Sydney makes it into the top 20 ecosystems globally faring well on metrics like funding and talent. However, it comes last for performance among the 20, where performance is defined as "In which ecosystem does an early-stage start-up have the best chance of building a global success?"
We need to nurture these ecosystems, in every city in Australia. We want Australia to be the place to build global technology companies – build local and sell global, like Campaign Monitor and Freelancer did, or start local and expand global, like Seek and Atlassian.
There are many ways we can approach this: increased funding for start-ups and broader funding programs that include seed grants for companies with compelling products – Israel and South Korea have instituted similar programs to great effect, for example.
Creation of more innovation districts, and a renewed focus on better tax incentives for R&D (we are currently below the OECD average) would also help underpin ecosystem growth.
And a thorough review of the recent Assistance and Access Bill 2018, which has the potential to greatly limit opportunities for exporting digital services where security may be compromised.
We need bipartisan political focus and collaboration amongst key stakeholders to build and grow start-up ecosystems, and in turn drive Australia's future prosperity through the huge economic and employment opportunity start-ups represent.