A tale of two FinTech hubs
Victoria: Where two FinTech hubs are better than one
The Victorian government has opted to fund two separate FinTech hubs in Melbourne following an extended tender process.
The government announced last June that it would work with an “established innovation hub operator” to establish a FinTech hub at the Goods Shed North in Docklands.
But on 21 December, one day before the Christmas and New Year’s break and typically a time used to quietly drop announcements, the state revealed that it would instead fund two two separate FinTech hubs – in two separate location operated by two separate companies, Stone & Chalk and York Butter Factory Ventures (YBF).
Stone & Chalk will take the originally proposed space in Docklands, while York Butter Factory will move to a new space in the Melbourne CBD.
The funding for the two new hubs will come from the government’s $200 million Future Industries Fund, and will cover the design and fit-out, rent and other government support measures for at least three years.
“We’re partnering with two hub operators to help grow Melbourne’s thriving FinTech sector. New technologies are changing the financial services industry and we’re working hard to ensure Melbourne’s FinTech sector continues to create jobs, technologies and exports,” Mr Dalidakis said.
The amount of funding provided to both of the FinTech operators has not been disclosed.
Stone & Chalk is a FinTech coworking space that first launched in Sydney in August 2015. It expanded to Melbourne in July last year, taking up office space alongside AgTech accelerator SproutX in the CBD.
The coworking space will now relocate to the 1500 square metre space in Docklands, which it says will house up to 300 entrepreneurs and open by next month.
Alan Tsen was appointed as the general manager of Stone & Chalk Melbourne in July last year when the organisation first came to Melbourne. Mr Tsen stepped down from his role as chief executive of FinTech Victoria to take the job.
FinTech Victoria was launched on the back of a $300,000 grant from Victorian government body LaunchVic in 2016, with the funding also going towards establishing FinTech conference Collab / Collide in Melbourne.
The funding was also for a report on the Victorian FinTech ecosystem, which was commissioned to EY. FinTech Victoria then worked with EY to develop a working group, with members from banks, super firms, venture capitalists and startups, to detail the wants and needs of the local FinTech sector.
The final report created from these meetings was used internally by the state government to guide its policy in the space, and led to the concept of the FinTech hubs.
InnovationAus.com understands the funding for the FinTech hubs was obtained by the department in July 2016, while the LaunchVic grant that led to the creation of FinTech Victoria was awarded the next month.
It’s understood that along with Mr Tsen, a number of the FinTech hub applicants were also involved in the initial working group and planning stages of the state's FinTech strategy, and efforts were made to ensure the tender process was independent.
In addition to the Docklands hub, the government will also be providing funding to York Butter Factory Ventures to assist with the creation of a FinTech hub at the organisation’s new space on Bourke Street in the Melbourne CBD.
Before the FinTech hubs were announced, YBF acquired Teamsquare and moved into the new space, which is five times bigger than their previous building.
The current Teamsquare businesses will be absorbed into the YBF population. The organisation will now also be partnering with StartupBootCamp, which has also received state government funding, to run a FinTech accelerator program.
The YBF hub will include a range of advisory services for FinTechs and founders, along with targeted mentoring, incubation and acceleration services and advisers.
YBF had actually originally proposed the Goods Shed space as a potential innovation hub to the state government back in 2014, and has been in discussions with the government since.
But the organisation opted to find its own space in the CBD before the government tender was announced, and will now be receiving funding to include a FinTech hub in its new space.