StartupAUS has issued its latest, sweeping Crossroads report highlighting some of the main causes for concern in Australia, and outlining how the Government can take swift action to fix the issues.
The report calls out the following:
- Australia’s startup sector is maturing at a slower rate than many other nations.
- High-growth tech companies could contribute 4% of the nation’s GDP by 2033, compared to just 0.2% today. This would add 540,000 jobs to the economy.
- In 2013, Australia invested just $4.5 per capita in Venture Capital for start-ups compared to $120 in Israel, $85 in the US, $20 in South Korea and $15 in the UK.
The challenges ahead
According to the Crossroads report, Aussie’s startup culture is lagging behind other developed countries. The report also points to the various challenges currently preventing a transition to a knowledge-intensive economy.
Alan Noble, StartupAUS board member and Head of Engineering, Google Australia stated in the report, “Australia’s fledgling startup sector has experienced a groundswell of activity over the last three years and we are seeing a number of Australian technology companies begin to achieve 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.”
The Crossroads report also details the necessary conditions for a successful startup system yet to be seen in Australia, primarily due to market failures in areas like education, expertise, access to capital and regulatory support.
Seven key actions to support the Australian startup ecosystem are recommended:
- Increase the number of entrepreneurs
- Improve the quality and quantity of entrepreneurship education
- Increase the number of people with ICT skills
- Improve access to startup expertise
- Increase availability of early stage capital to startups
- Address regulatory impediments, particularly in relation to employee share schemes and crowd-funded equity for start-ups
- Increase collaboration and international connectivity
Jana Matthews, StartupAUS board member and Managing Director, ANZ Innovyz START stated, “With new technology companies disrupting almost every global industry, Australia has a huge opportunity to capitalize on its creativity culture and ability to deliver world-changing innovation such as wi-fi and Cochlear implants.
Past successes pave the path…
“Great successes such as Atlassian and Freelancer prove that Australian startups can be successful on the global stage. However, if governments at all levels do not take the lead and do more to foster, promote and back tech startups, 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.“
The monumental inforaphic version of the report can be downloaded here.