Government initiatives, such as the Coalition’s Incubator Support initiative, are of huge benefit to Australia’s start-up ecosystem but there needs to be a greater focus on education for emerging business people, according to Jack Delosa, founder and CEO of the Entourage, a leading educator and community of entrepreneurs.
Announced last week, the Turnbull Government’s Incubator Support initiative includes $23 million in matched grants for new and existing incubators to help start-ups access advice, capital and business connections. Incubators can apply for grants of up to $500,000 per project plus grants of up to $25,000 to engage experts-in-residence from overseas and Australia.
Delosa applauded this initiative, along with the NSW Government’s Jobs for NSW fund, which includes a suite of financial support programs for SMEs and start-ups as well as incubators and accelerators.
He told Dynamic Business that while these government offerings will hopefully enable more entrepreneurs to start and grow innovative businesses, there is a ‘gaping hole’ in government rhetoric and initiatives, both at the state and federal level; namely, education.
“While there is a strong focus on innovation from government, the education sector isn’t receiving the same attention,” he said.
“Vocational education and training (VET) sector is in a state of limbo, and private education institutions are hamstrung by indecision. Being in the education sector, the Entourage is not being enabled by this government activity.”
“In my view, in order for early stage businesses to be successful, you need to give them two things: education and money. Give them money without the education, they’ll lose it. Give them education without the money and they may be successful but they’ll be resource-constrained, so their growth trajectory will be slower than what it could have been otherwise.”
“When government starts to drive programs that enable not just incubators and accelerators but also education institutions, that’s when you’ll really start to see entrepreneurship and innovation become part of the fabric of society.”
Asked how the Incubator Support matched grants should be allocated, Delosa said the federal government needs to carefully look at the expertise and experience of the team driving the incubators that have applied.
He added, “If an incubator is too academic or doesn’t carry enough experience, this undermines the integrity of the experience early stage entrepreneurs should be gaining”.
Further, Delosa said the government shouldn’t discriminate between new and existing incubators when it comes to allocating matched grants.
“Favouring established incubators is counter-productive because it leads to a situation where existing providers are being rewarded regardless of how ineffective they are,” he said.
“Meanwhile, new players are being disadvantaged regardless of how effective they could be. Sometimes the new incubators bring the most innovation and are the most effective.”