Australian tech startups are suddenly on the nose in Canberra

  • StartupAUS’s annual Crossroads Report says the political narrative around startups has changed.
  • And there’s an increasingly hostile political attitude towards tech companies.
  • The report says political antipathy to tech makes it harder for Australia to catch up to its global competitors.

Tech startups, once seen in Canberra as bright things heralding a better future for Australia, have lost their lustre among federal politicians.

    StartupAUS, in the national startup advocacy group’s annual report card, says hostility from the political class partly stems from disquiet over disruptive companies changing the economic landscape.

    “Perhaps the biggest challenge facing the sector in Australia is that the political narrative around startups has changed,” says Alex McCauley, CEO of StartupAUS.

    The tech-phobic trend is identified in StartupAUS’s Crossroads 2018 Report, the fifth annual investigation of the startup universe in Australia.

    When Malcolm Turnbull became Prime Minister in 2015 he appointed an Assistant Minister for Innovation, alongside the Minister for Innovation, Industry and Science.

    “In the wake of a disappointing election result in 2016, Turnbull’s personal advocacy for supporting the growth of a local tech sector lost some of its fervour,” says McCauley, writing in the Crossroads 2018 Report.

    “And after his departure in 2018, another reshuffle saw ‘innovation’ without any mention in a ministerial portfolio.”

    McCauley says the narrative shift is in part about disquiet over disruptive companies heralding changes in economic structures.

    “But it’s also partly about an increasingly hostile political attitude towards tech companies more broadly,” he says.

    “That trend is a global one, but Australia has shown signs it is at the tech-phobic end of the spectrum.”

    And this could have a major impact on startups.

    Already research and development support for software companies through the R&D Tax Incentive is getting tighter.

    “Political antipathy, or even apathy, towards tech makes it harder for Australia to catch up to its global competitors, putting us at risk of joining the ranks of the disrupted rather than the disruptors,” says McCauley.

    However, he say there’s no reason to get carried away with the doom and gloom.

    “With strong fundamentals, plenty of capital, and a crop of world-class tech companies reaching maturity, Australia is well positioned,” he says.

    “If we can address the narrative questions around the importance of startups for Australia’s economy more broadly, we will be in the box seat to build a sector that can contribute to, or even drive, Australia’s prosperity in the years ahead.

    “There is a strong case to be made here, with startups driving huge job growth and wealth creation. One of the main reasons we first started publishing Crossroads was to make that case.”

    A graphic summary of StartupAUS’s Crossroads 2018 Report:


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