Is Australia the new startup tech haven?
From Atlassian and Nitro, two local startups that have made a large impact overseas, to ShowPo a female fashion retailer whose revenue grew 288 per cent from 2010 to 2014, to Lekker Bikes and Stylerunner, Australia has enjoyed a renaissance of entrepreneurialism that has investors excited and the world talking about exciting startup ventures on antipodean shores.
Looking at the success and growth of startups in this country, there are good reasons why.
A change in attitude
There has been a paradigm shift in Australia in the past few years; a rekindling of the entrepreneurial spirit that once saw Australia revered in science and technology research.
Entrepreneur Julio De Laffitte believes this is because Australian business people and venture capitalists are coming to the realisation that “In order to drive the economy, businesses must be created, not discouraged or forced to fold.”
De Laffitte who recently founded Unstoppables, an 11-day entrepreneurial forum held in Antarctica, and which was attended by 106 Australians resulting in 98 new businesses being formed says, “If you set the right environment, Australian businesses can flourish.”
According to Levi Aaron, General Manager of startup success Yumtable, “There are more start-ups, incubators, and collaborative works spaces in Australia than ever before. An increased amount of innovative people are taking the plunge, deciding to leave the comforts of their corporate jobs, risking it all for their shot of becoming the next biggest thing.”
He says that shift in attitude is not only internal, but international organisations have also changed their attitude.
“It is worth asking the question as to why so many overseas start-ups, larger second and third round innovators and disruptors, all the way up to the greats like Uber and Airbnb have made huge efforts and leaps into Australia.
“Whilst we are quite a few steps behind the world when it comes to supporting start-ups and providing the most ideal and fertile ecosystem to help them grow, Australia does have something else that is quite unique – our thirst for technology and willingness to jump on board to try the latest solutions to problems.
“Believe it or not, Australians are very fast adopters. Over 65% of our population own and use smartphones, a further 73% of the population heavily rely on social media as a means of keeping their finger on the pulse, whilst the average consumer has 33 apps downloaded onto their smartphones. What this means for startups here, is that we have a captive audience who is willing to try new things, a perfect testing ground for your startup idea, one that if you do get right, may also have global potential.
The talent pool
There is no doubt the likes of Silicon Valley, Asia and Europe has a bigger talent pool for specialist skills. These regions have larger populations and more resources to draw from. However this is another tide that is turning.
“We have an unbelievable wealth of talent chomping at the bit to succeed. As Australians, we just need to foster the right environment,” De Lafitte says.
Many of Australia’s talented entrepreneurs now believe that it is ‘better be a big fish in a small pond rather than a small fish in a big pond’.
“This rings true with many of the startups that I have dealt with or spoken to,” Aaron says. “Founders of startups need to look towards the local market. This is the market that they live and breathe. The mentality of the potential customers for their products and services, as well as the culture of those around you, is something that is second nature and should not be overlooked when first developing and testing your idea. Cutting through the noise and getting noticed is much easier in Australia, and often this is what startup needs in order to gain a leg up.
Better investment opportunities
“People are watching this little country of ours and the movements going on,” Aaron says. “In most cases, it's better to own or captivate an audience you know than be distracted by the buzz and excitement overseas, only to find that there are 10 other startups based there doing exactly what you are attempting to create but with their home ground advantage.”
This means the biggest and brightest are staying home because there are now better opportunities to create stable businesses and effect change.
And with companies such as Oxygen Ventures now encouraging Australian startups, not only through finance, but also resource and mentor support, there is more reason for Australian entrepreneurs to remain on antipodean shores.
In effect these investors understand that startups have an impact on the socio-economic demography in the countries they reside, including on employment, cultural change, trade and in either reviving or creating industry.
Author: Jonathan Jackson