The Turnbull Government’s grandly named $11 million offshore initiative for Australian startups – the Global Innovation Program – will be firing on all five cylinders by October as the first batch of companies touch down on the San Francisco ‘landing pad’ to try their luck.
And other parts of the first phase of the federal innovation model come under some pressure.
The five companies now in San Francisco include a child-safe wi-fi network and a personnel management solution for large volunteer-led events.
The other four landing pads are in Tel Aviv, Shanghai, Singapore and Berlin and co-working facilities facilities have been chosen in each city.
“All five Landing Pads are all due to be operational by October,” an Austrade spokesman told InnovationAus.com
“Landing Pad Coordinators with specialist knowledge and skills are being recruited locally for each site,” he added, noting that the Tel Aviv will be managed by Austrade’s recently appointed Landing Pad Coordinator there, working closely with Austrade’s Senior Business Development Manager for Israel.
“Organisationally, Austrade’s office in Israel is managed from our London post. However, the Landing Pads program itself is managed centrally by Austrade within its Trade Division.”
This means both the Berlin and Tel Aviv programs will be ultimately run out of Austrade’s European office, which is in the German financial capital Frankfurt.
Still, Austrade’s model is to effectively outsource the operating of the landing pads to co-working space partners. In the case of San Francisco, RocketSpace was appointed, and this model it will follow in other cities.
This has led to some in the industry questioning exactly what value the government is adding, especially in user friendly places like California, where even the most hapless of Australian companies could easily find its way.
This was underscored recently by Sydney-based coworking space group Fishburners opting to do its own thing in Shanghai.
The news comes as freshly appointed Industry, Science and Innovation minister Greg Hunt has been working to actively shift the focus of the still nascent National Innovation and Science Agenda (NISA), which was forestalled somewhat by the lengthy federal election campaign and subsequent poll.
In many ways, the actual program’s take off is the end of the stuttering Part One of NISA.
The government’s strategy to make Sydney the Asian centre for so-called FinTech businesses also seems to be struggling. According to consulting firm Accenture investments in Asia-Pacific in tech ventures reached $US9.62 billion as of July 31, more than twice the $4.26 billion in the previous year – and that the investments were primarily in China. (Admittedly about half the figure was due to a fund raising around Alibaba’s FinTech arm Ant Financial.)
“In fact, the top 10 investments in Asia-Pacific FinTech ventures occurred in China and Hong Kong, accounting for 90 per cent of overall Asia-Pacific investments and valued at $8.75 billion,” Accenture noted. “In total, China and Hong Kong FinTech ventures have attracted $9 billion in investments so far in 2016”.
Kinda puts Australia, and phase one of Mr Turnbull’s NISA in shade – or rather, into perspective.
The government’s sensible broadening out of its innovation/technology strategy also comes as Facebook founder and chief executive Mark Zuckerberg delivered a broadside to many Silicon Valley types, pouring cold water on a startup model that Australia has been keen to mimic – albeit without the established funding infrastructure that has made the Valley such a hotbed of success.
In an interview with Sam Altman, chairman of early stage startup funding group Y Combinator, Mr Zuckerberg opined that many of Silicon Valley’s so-called founders had their business models back-to-front.
“I always think that you should start with the problem that you’re trying to solve in the world, and not start with deciding that you want to build a company,” he said.
“People decide often that they want to start a company before they even decide what they want to do, and that just feels really backwards to me.”