The NSW Government is launching a $35 million innovation hub; the startup community reacts

Sydney Startup Hub

The NSW Government has pumped $35 million into the creation of a startup and innovation hub, which will occupy 17,000 square metres, across 11 floors, on York Street in Sydney’s CBD.

In a joint statement, Premier Gladys Berejiklian and Small Business Minister John Barilaro said the Sydney Startup Hub will be the largest startup hub in the southern hemisphere, with space for 2,500 residents plus a ‘regional landing pad’ to cater for entrepreneurs outside the metropolitan area.

They announced that four startup support bodies – Stone and Chalk, Fishburners, Tank Stream Labs and The Studio – would serve as the hub’s anchor tenants.

The Sydney Startup Hub is being funded by Jobs for NSW, with the aim being to generate up to 6,500 new jobs across regional and metro NSW. Based in the “Transport House” and “Railway House” buildings above Wynyard station, it is expected to open in late 2017 or early 2018.

Here are some of the reactions from within the local startup ecosystem…

Mandeep Sodhi, CEO of fintech startup HashChing

“This is a welcome step forward for Sydney, and will be instrumental in establishing the city as a desirable destination for launching new startups.  One thing that many startups struggle with is finding a good space to work that doesn’t break the bank. The subsidised rates that will be available in the Sydney Startup Hub will certainly help with attracting the best and brightest new businesses, with the knock-on effect of creating more job opportunities. With a massive ecosystem of accelerators, startups and VCs all in one space, this new hub will enable Sydney to better compete on a global scale when it comes to attracting and retaining entrepreneurial talent.”

Karen Lawson, CEO of Corporate Startup Accelerator Slingshot

“Australia is becoming a hotbed for the startup community. Amidst the political and economic uncertainty in the US and Europe, we have a unique opportunity to provide a strong base for startup and scaleup businesses. We welcome this initiative by the NSW government – it’s a key element to build economic growth and reverse the trends of Australia’s declining pace in an ever-growing startup global market.

“However, accessible co-working facilities are only one piece of the puzzle. For us to truly compete on an international scale, we need to look at the whole ecosystem beyond just startups. Successful hubs need open-networks, access to capital, knowledge transfer and customers to scale. This is where connections to Australia’s established corporates, through accelerator programs like the ones we are running with Qantas, Seek, Hudson and LION, can really help them scale not just nationally but globally.”

Danielle Szetho, CEO of FinTech Australia

“[The Sydney Startup Hub] will go a long way toward helping to grow Australia’s startup ecosystem. It is particularly exciting to see that two of our members, Stone & Chalk fintech hub and Tank Stream Labs, have been confirmed as tenants in this important new facility. Having a space that promotes collaboration and connectivity both within the startup community, and outward toward greater NSW and the Asia-Pacific region will ensure we have a vibrant and dynamic ecosystem with a forward-looking international perspective.”

Jonathan Lui, co-founder of Airtasker

“I think it’s a great initiative from the government and definitely a step in the right direction. Innovation occurs in all industries and the associated support networks will come from both the private and public sectors. There is no silver bullet to innovation, but this will open up more opportunities for Australians to create new businesses I think this is both a support framework but also an education framework, to help further the innovation agenda and encourage Australians to think about solving problems with a commercial outcome. Ideally with more businesses being created, there will be more opportunity and jobs created. However, don’t expect innovation to happen overnight, as it’s an ongoing commitment and this is a great initiative.

“If you look at the impact of technology its clear that it is changing our lives and that these changes are only going to happen faster and in bigger ways. It’s important that we embrace these changes and this will keep us on the world stage such that we can attract more investment, creating more opportunities, knowledge and jobs, to keep the cycle growing over time. Over the past years we’ve seen the ecosystem develop well in terms of talent, investment capital and mainstream media coverage. Adding the government into the mix can only help to strengthen the ecosystem and lead to more opportunities.”

Dean McEvoy, CEO of Tech Sydney

“It’s great to see the NSW Government listening to the startup industry around the importance of building density. The significant investment [in the hub’s creation] is one of the greatest contributions government could make to fostering a strong startup ecosystem. There is clear evidence within Australia and overseas around the multiplier effect this investment can have on economic outcomes and jobs growth.

“A global Harvard review around digital technology performance, released this week, shows that whilst Australia enjoys a high state of digital advancement we are in the ’stall out’ category and now showing signs of slowing momentum. The creation of more high-density innovation hubs are crucial to getting our digital technology performance where it should be within the State and more broadly across Australia.

“The Sydney Startup Hub will help us to attract and support startup talent and will also provide a central space where visiting experts can focus their time. In this fast moving industry the knowledge of how to successfully build a high growth technology company has a very short shelf life, so the only way you can accelerate the learning of these founders is to put them close to other founders at a similar stage. This will be a place where the smartest and the brightest can learn from each other.

“We are keen to see the Sydney Startup Hub open quickly, particularly given there have been a number of stalled attempts to create this sort of space in the past. Sydney has some great community spaces for startups but they are currently overflowing.”

Alex Gruszka, Head of Data and Insights at StartupAUS

“This is a bold and exciting initiative from Jobs For NSW. StartupAUS has consistently called for innovation districts as a key component in any startup ecosystem, and the Sydney Startup Hub represents the biggest investment toward that goal in NSW history. Now the work is ahead of us to make sure it’s thriving with activity from Aussie startups.”

Julius Wei, co-founder of wealth management firm BMY Group

“We definitely welcome this move by the NSW Government. As a manager of an Australian startup tech fund, who also advises and works with various other startup companies, we think this is the right way to go.

“Particularly when you start looking at investment from overseas, for example China, Chinese capital and institutions are encouraged by the government to seek overseas investment into technologies rather than properties. So, having a hub that is backed by a state government in Australia is a strong reassurance to those investors, showing that government support to Australian startups and technologies.

“Going forward, there might even be opportunities to co-host these sorts of hubs, which could be supported by two countries to leverage and combine the resources and advantages from both of those regions.”

See also: “Previously, the government wouldn’t have engaged SMEs in this way”: Jobs for NSW CEO