The battle to become Australia’s startup capital is showing no sign of ceasefire. Despite Ed Husic, Labor’s digital innovation and startup spokesman, criticising the Federal Government’s “rudderless” commitment to the cause during the election this month, state governments on both sides of the Murray are ramping up their entrepreneur recruitment campaigns in the wake of the “ideas boom”.
Philip Dalidakis, Victoria’s Minister for Small Business, Innovation and Trade, claimed the title of ‘Australia’s startup capital’ at the launch of the $60 million LaunchVic innovation fund, which will provide startups with the infrastructure to support their success. “We want Victoria to be the location of choice for startups worldwide”, Dalidakis said. “This is about encouraging young companies and ideas to create jobs and industries that will support our state for decades to come.”
Meanwhile the NSW Minister for Small Business, John Barilaro, is keen to show the government is still holding on to their reputation as the start-up state. The Innovate NSW initiative offers a range of support including matched funding of up to $15,000 to help startups and SMEs develop new technologies in areas such as manufacturing and online education.
With millions of dollars being invested into attracting and growing startup communities in both Victoria and NSW, is there really a need for a startup state-of-origin when the ultimate goals are the same?
For those of us in startup land, we’re all feeling like winners at the moment. It certainly feels good to be wanted. But it also makes economic sense for governments too.
With tech startups predicted to contribute $109 billion (4% of GDP) to the Australian economy and create 540,000 jobs by 2033 it’s in everyone’s interests that Australian entrepreneurs are given the best chance to succeed, regardless of where in Australia they’re located.
Since launching in Melbourne with a handful of staff back in 2005, Nitro has grown to a team of almost 200 with offices in San Francisco, Dublin and Melbourne. In that time, we’ve learned a thing or two about what makes a city a great place to operate a startup.
As a member of the Victorian Government’s Innovation Panel, I’ve also seen what policymakers can do to bolster their cities startup credentials. So here are my top insights into what makes the ultimate startup hub.
It’s not about startup numbers, it’s about the community
There’s more to establishing a startup hub than the number of startups a city can lay claim to. While almost half of all Australian startups are based in New South Wales (NSW), according to data from Startup Muster, most major Australian cities are benefitting from the arrival of startups. Outside of NSW, 17% of startups are based in Melbourne, 9% in Perth, 9% in Brisbane, 6% in Canberra, 4% on the Gold Coast, and 3% in Adelaide.
But it’s not just about the numbers. It’s about developing a way of working, a community. As a startup business, being located in a startup hub allows you to establish yourself in a culture where people are connected, where there’s a range of skills, experience and education at your doorstep. Things happen faster, people work more intelligently, and meeting investors is much easier.
With so much talent right next door, you never know who you’re going to bump into. Sometimes those chance encounters are the ones that turn into the most prosperous business ventures.
You must attract talent to your shores
Any city looking to establish itself as a startup hub needs to provide a high quality talent pool, or be able to attract the best to its shores.
According to Startup Muster, 42% of startups say the biggest challenge they face is the availability of tech talent, so getting this right is key. In today’s fast-moving climate, startups are on the lookout for the cream of the crop. For most startups, getting high-quality graduates on board will be the key to their success, so if a city is home to a large or specialised university then that’s a great start.
As well as attracting recent graduates and training our workforce from within, startups want to be in a place that will enable them to attract outside candidates. The city we establish ourselves in must be easy to relocate to, have a great lifestyle, and be affordable.
For example, in Melbourne, not only have startups been drawn to the great food, coffee and the world’s most live-able city label but more importantly talent has, effectively, been attracted by talent with major startups such as Slack, Square and GoPro choosing Melbourne as their Australian home base.
Inspire and retain employees
Companies must be able to retain their employees, keep them interested and maintain their zest for learning.
The keyword when it comes to retaining employees is “culture”. To reach its full potential, a startup hub should be comprised of a community of like-minded individuals. Providing spaces for employees to meet up and discuss issues facing the industry, share thought leadership or contribute to sharing ideas and knowledge on a particular subject, makes people feel part of something bigger.
Real, live interaction promotes healthy collaboration, coordination and cross-pollination of ideas, which is essential to sustain a pipeline of talent.
Look to existing startup success stories for inspiration, and not just in the usual places
We’ve all heard about the startup hub successes of Silicon Valley, London and Tel Aviv, but there are plenty of other, less obvious examples out there such as Nairobi in Kenya, Iceland’s capital Reykjavik, and Montreal in Canada. It’s about the potential they can demonstrate to their prospective startups.
For example, we at Nitro chose Dublin for our European Headquarters. For a small city, Dublin attracts a lot of positive attention on the world stage, and the technology sector in particular is thriving. When we decided to establish ourselves there, we could see the potential Dublin had, and over the past few years we’ve seen the city emerge as a tech hub to rival London or Berlin.
Adam Nowiski is the APAC director of Australian digital documents startup Nitro and is a member of the Victorian Government’s Innovation Expert Panel.
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