A new report released today shows Australia’s startup ecosystem is lagging behind those of many other developed nations – it highlights several profound challenges that are hampering the growth of the this sector and the economy at large.
With input from Australian entrepreneurs and investors, the Crossroads report by StartupAUS puts forward a proposed set of solutions to accelerate the growth and maturation of the startup ecosystem.
Alan Noble, StartupAUS board member and Head of Engineering at Google Australia commented that only now are a small number of Australian technology companies achieving meaningful global scale.
“However we still lag behind many other nations, with one of the lowest rates of startup formation in the world, and one of the lowest rates of venture capital investment. If we fail to address this, we risk forfeiting over $100 billion in economic benefits from emerging tech companies, and an irreversible decline in Australia’s competitiveness,” Mr Noble said.
The Crossroads report claims that the conditions for a successful startup system have not yet been successfully established in Australia. The reasons set out are primarily to do with market failures in areas such as education, expertise, access to capital and regulatory support.
Seven key actions to support the Australian startup ecosystem are recommended in the report, namely:
1. Increase the number of entrepreneurs;
2. Improve the quality and quantity of entrepreneurship education;
3. Increase the number of people with ICT skills;
4. Improve access to startup expertise;
5. Increase availability of early stage capital to startups;
6. Address regulatory impediments, particularly in relation to employee share schemes and crowd-funded equity for start-ups;
7. Increase collaboration and international connectedness.
As to what can be done to achieve these recommendations, Jana Matthews, StartupAUS board member and Managing Director, ANZ Innovyz START said it would be up to governments at all levels to take the lead, and do more to foster, promote and back tech startups. Without doing so, Ms Matthews is emphatic that Australia will miss out on major economic and cultural benefits.
“The time to act is now, and we will be bringing this report to federal, state and local policy makers and Ministers with a view to driving action in this space,” Ms Matthews said.
Pointing to successful Australian startups like Atlassian and Freelancer, Ms Matthews believes these companies are proof Australians have what it takes to make it internationally.