Australia’s startup sector says the budget has abandoned Turnbull’s ‘innovation agenda’ after just one year

Photo: Stefan Postles/Getty Images

The Australian startup community says Tuesday night’s federal budget lacked support for innovation and entrepreneurship.

StartupAus CEO Alex McCauley said the startup sector “dropped off the radar”.

“That will certainly cause some frustration, because the government has done a lot to build expectations that it is committed to making Australia one of the best countries in the world for innovators. It still has a lot of work to do to deliver on that commitment,” he said.

McCauley that after treasurer Scott Morrison spoke of “harnessing the power of innovation and entrepreneurship, to create our own ideas boom” in last year’s budget, this year’s speech failed to mention the startup industry at all.

York Butter Factory co-founder Stuart Richardson said the budget forgot the government’s “innovation agenda”.

“Unfortunately those with entrepreneurial drive and innovative zeal, those who shape and support the future of the economy have been given little by this budget at a critical juncture when we can least afford to kick innovation to the side,” he said.

Mike Pritchett, co-founder of video platform startup Shootsta, labelled the budget “a joke” for the sector.

“Once again, the innovation hype has been all talk. It was pushed and pushed as being so important, and it hasn’t been reflected in the budget,” he said.

“It is a disappointment — there is no push for extra funding or anything to do with startups, which is a massive oversight. If you compare Australia’s attitude towards startups as compared to the rest of the world, it’s typical. It’s just a joke.”

Anna Rooke, CEO of creative tech accelerator QUT Creative Enterprise Australia, said that the previously mentioned “ideas boom” seemed to have been wiped in favour of “traditional” industries.

“It’s disappointing, but this is a budget built around traditional skills and traditional industries like housing and transport infrastructure,” she said, calling for a plan that enables Australian “startups to compete globally”.

Although there was little direct financial intervention for startups, the budget did remove the GST on Bitcoin purchases, drafted legislation to allow private companies to crowdsource equity funding, expanded the fintech regulatory sandbox and removed some barriers for businesses to call themselves “banks”.

But even after successfully raising $US25 million of capital last year, Medical Channel CEO Nazar Musa is worried the budget’s lack of recognition for the startup sector would accelerate Australia’s brain drain.

“Any focus on startups would have supported tech entrepreneurs, or at least slowed down potential talent leaving Australia and going to the States or Europe. Now, without any further government support, this talent may not come back,” he said.

Trevor Townsend, managing director of accelerator Startupbootcamp Melbourne, acknowledged the draft proposal to allow private companies to crowdsource capital raising was a positive, but that alone was not enough.

“It appears that the new economy is no longer a priority for the federal government,” he said.

TechSydney chief Dean McEvoy also joined the chorus of disappointment.

“Overall this budget is underwhelming for the tech industry and that’s disappointing for the future of Australia because the economic future of this country lies with the high-growth tech sector,” he said.

“If your team was on the path to win the grand final, you would bet on them to win — the government didn’t do that tonight, they bet on the status quo.”

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