AlwaysOn plans to bring Silicon Valley to Australia

AlwaysOn plans to bring Silicon Valley to Australia

Summary: Although Aussie startups generally believe that they need to go to the US to find funding, one man is hoping to do the opposite by bringing US investors to Australia.

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TOPICS: Start-Ups, Australia
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One sore point that is often brought up in conversations about whether a Silicon Beach startup community can thrive in Australia, is that all the investors and venture capitalists are in the US and they are not interested in what happens down under. However, rather than lose talent to the US, one organisation is planning to coax major players from the US to Sydney, embarking on what it is dubbed as the globalisation of Silicon Valley.

The man behind the event AlwaysOn Australia, which will be held in April, is Tony Perkins. In turn, Perkins' vision is spawned from his belief in venture capitalist and managing partner of Accel Partners Jim Breyer. Accel is better known for making the remarkable decision of investing US$12.5 million in Facebook, but the oft overlooked fact is that Breyer fronted up an additional US$1 million out of his own pocket.

But what has put Australia in Perkins' sights is the fact that Accel is one of the few US venture capital firms that has hit three for three by investing in Atlassian, Ozforex, and 99designs.

Breyer himself said last year at the AlwaysOn Venture Summit Silicon Valley that in the next five years, over 50 percent of venture capital returns would come from outside of the US, naming Australia as one of those countries.

Perkins highlighted that one of the differences between Sydney and Silicon Valley was that the funding model for startups is significantly different.

"The private company investment market here in Australia is still fledgling. When you look at the Australian market, it's not apparent that those five to seven levels of capital exist here. It's a little more of a bootstrap environment.

"But if you [look at] the number one VC firm in America investing in three Australian companies, what they're doing is they're coming into this market, they're seeing that the investment market is still developing, and they're coming in and filling that void by providing capital."

Part of the issue is the fact that Australian entrepreneurs have a less refined pitch than their counterparts in the US, and seemed to be afraid to dream a little bigger.

"It's clear that Australian entrepreneurs are newer to the game and less sophisticated than the average American entrepreneur in terms of their presentations, and some of the businesses being pitched were solid ideas, but they weren't the next Twitter or Facebook. But that's okay, it's just the beginning."

However, to make sure Australians get off to the right start, Perkins hopes that events like his will send a clear message to the US that it's worth investing and building an ecosystem here.

"Right now, there's only a handful of VCs that are even looking at Australia, but what will invariably happen is that when the US venture capital market starts witnessing the success of Accel's investment here, then that will create a momentum of interest."

Topics: Start-Ups, Australia

Michael Lee

About Michael Lee

A Sydney, Australia-based journalist, Michael Lee covers a gamut of news in the technology space including information security, state Government initiatives, and local startups.

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