Bowen calls for 'natural partnership' with startups
Australian Shadow Treasurer Chris Bowen has said that a Labor government would work to develop a 'natural partnership' with the local startup industry in a bid to help drive local innovation and overcome emerging economic challenges.
Australia's Shadow Treasurer Chris Bowen wants to establish a "natural partnership" between the local startup sector and government if the Labor Opposition is voted in at the next federal election.
Bowen, who spoke at the launch of the "Labor for Innovation" group held at the BlueChilli incubator headquarters in Sydney on Wednesday night, said that such a partnership would enable Australia to overcome the emerging economic and industry challenges it faces by driving innovation domestically.
"We want to see Labor and the startup community -- the entrepreneurial community -- as natural partners working together in a very natural way, because we all believe in growth, jobs, in doing things in a new and better way," said Bowen.
"We are facing, in Australia, two economic challenges," he said. "The massive change in our economy as the massive mining and construction boom comes a very rapid end ... the other big change, which we're not talking about as a country, is the rise of jobless economic growth.
"And we need to be thinking about this as a nation and embracing innovation and change, and embracing education as well," he said.
Bowen, who appeared at the event with Shadow Parliamentary Secretary to the Shadow Treasurer Ed Husic, said that to help the government better understand the startup sector, he would like to set up a formal process that would see the federal treasurer maintain close and regular contact with the startup community.
"Often, there's not a whole lot of regard or understanding for what makes this sector work, and what drives entrepreneurs, but there needs to be," he said. "And so a formal process where the treasurer of the day can sit down once a month, once every two months, with entrepreneurs and share ideas, share concerns, compare notes on what's happening around the world is a really important part of how we'll do business in office, and how we'll conduct ourselves in office."
He also reiterated ideas he had previously put forward, such as the introduction of a special class of entrepreneurial visa.
"We need to be encouraging young people, in particular, to be embracing the spirit of innovation and entrepreneurialism," said Bowen. "We don't need to tackle the age of entitlement, we need to tackle the age of entrepreneurialism.
"We don't want the revolution to happen elsewhere; the revolution has got to happen here," he said at the event.
The Labor for Innovation group, established by Posse founder Rebekah Campbell, describes itself as a Labor organisation for innovators, startups, entrepreneurs, and anyone interested in building a new economy.
Campbell, who spoke at the event along with BlueChilli founder and CEO Sebastian Eckersley-Maslin, said that she hopes the group will make a big impact over the next few years, and help come up with new policy ideas aimed at supporting Australian startups and innovation.
Bowen's comments follow the release earlier this week of the second annual Crossroads report -- an "action plan to develop a vibrant tech startup ecosystem in Australia" -- published by StartupAUS, the not-for-profit organisation formed by 50 stakeholders from the national startup community.
The report suggests that Australia risks falling behind other countries that are working to give their startup enterprises the boost needed to stimulate economic growth.
"Over the past two decades, many countries have recognised that high-growth, technology-based businesses are important drivers of economic growth, and a growing number of governments have responded by launching programs to systematically invest in the creation and support of high-growth companies," the report said.
"Australia has not kept pace, and has under-invested in catalysing and supporting its high-tech industries, as evidenced by the fact that we now have one of the lowest rates of startup formation in the world, and one of the lowest rates of venture capital investment," it said.
The report argues that despite a burgeoning groundswell of activity in the startup sector over the past few years, Australia is witnessing a trend for the country's fastest-growing technology companies to leave Australia in search of talent, capital, and a more favourable regulatory environment.
"As a nation, we need to take immediate and far-reaching steps to address market failures that are impeding the maturation and growth of our startup ecosystem," it said.
The paper proposes eight actions that should be taken to help get Australia's startup ecosystem back on track, suggesting the creation of a national innovation strategy, increasing the number of local entrepreneurs, and improving the quality and quantity of entrepreneurship education.
It also recommends increasing the number of people with IT skills, improving access to startup expertise, increasing the availability of early-stage capital to startups, addressing the legal and regulatory framework that may currently impede the sector, and increasing collaboration and international connectedness within the industry.
"Implementing the plan ... will form an important part of the economic reform upon which Australia needs to embark if we are to successfully transition to a knowledge-intensive economy, and continue our current economic prosperity well beyond the resources boom," it said.
In a public hearing on Wednesday, the Senate economics references committee inquiry into Australia's innovation system heard from the University of Technology, Sydney, vice-chancellor professor Attila Brungs that Australia has the perfect opportunity to take home-grown innovations to the world stage, but that without the right policy settings, the country's innovation system will not reach its full potential.
Meanwhile, chief executive of the Australian Information Industry Association Suzanne Campbell told the inquiry that innovation is the primary driver of higher Australian living standards, but that cuts to government programs have undermined the nation's potential.
Campbell said that 80 percent of Australia's research efforts are derived from public research institutions such as the CSIRO and NICTA, and that cuts to these agencies have disadvantaged future generations of Australians in the global race for innovation and jobs.
Funding cuts in the government's 2014-15 federal Budget, delivered in May last year, saw the Coalition announce plans to scrap eight programs aimed at supporting innovation and local startups, saving a projected AU$845.6 million over five years.
On the chopping block were Commercialisation Australia (CA), which had provided more than AU$200 million in funding to local startups, and the Innovation Investment Fund (IIF), which had worked to connect startups with venture capital.
In their place, the government devoted AU$484.2 million over five years to its Entrepreneurs' Infrastructure Program, which the federal Minister for Industry and Science Ian Macfarlane said in October would see businesses and innovators gain access to the "full suite of support streams to usher in a new wave of competitiveness and productivity growth".
The final part of the government's package, the Accelerating Commercialism stream -- released in October -- is designed to enhance the country's ability to bring its most compelling new products, processes, and services to market.
"Australia has some of the best researchers, inventors, and entrepreneurs in the world, but our track record of turning great ideas into commercial products is not as good as it could be, or as good as it should be if we are to keep pace in evolving global markets," said Macfarlane.
"Accelerating Commercialisation will help innovative Australian businesses to tackle the challenges they come up against in commercialising new ideas, by providing access to the expert advice, experience, and networks crucial for attracting investment and getting new ideas into the marketplace," he said.