Australians go to the ballot box this Saturday to decide who will lead the nation for the next three years, with the polls suggesting the decision between Labor and the Coalition is getting closer.
Whoever wins, the country’s growing startup sector will be looking to the new government for direction and support as they build their businesses.
Yesterday, StartupAus held a Q&A with Labor’s Shadow Minister for the Digital Economy and Human Services, Ed Husic, ahead of Saturday’s vote.
StartupAus CEO Alex McCauley said it was a great opportunity for the startup and tech sector to have genuine engagement with a politician who is passionate about the area. The Coalition was also invited to address StartupAus but did not take up the offer.
“It’s been tough to get politicians to talk seriously about startups in the last 12-18 months,” he said.
“How we support the growth of the next wave of blue chip businesses in Australia is actually critically important to the overall economic health of the country, so I think we put these issues on the sideline at our own peril.
“The conversation with Ed helped clarify Labor’s position on how it sees technology in the overall vision for Australia’s economy. We’d like to keep delving deeper on that question with both sides of politics.”
So to give whoever ends up as minister in charge of the startup sector next week a bit of a leg up, Startup Daily spoke to nine startup founders and executives about what they’d like to see from the incoming government.
Here’s what they said:
CEO & co-founder of Girl Geek Academy
To help all startups succeed we need a healthy technology sector. I’m crossing my fingers and toes Labor gets in so they can ship some of the amazing policy they’ve announced.
Reinstating the interactive games fund is a stellar move (it never should have been cut in the first place but feel free to ask me about that over a few cold ones).
I welcome the impact of Labor’s policy announced today at Box Hill TAFE. Ed Husic announced 5000 fee free digital & ICT TAFE places if a Labor Government is elected.
Free TAFE works particularly in technology education – bring on more of this type of change please. Labor’s policies for women are laid out in a high-quality strategy which are not only best practice but leading the way on both the prevention of violence against women and gender equality.
Meanwhile Morrison’s “I’ll respect you” vow set in the future tense sums up why, for me, Saturday can’t come quickly enough.
Founder & CEO of Wanngi
Wanngi was created to help consumers feel more empowered by allowing them control and access to their own health information. However, we need help as due to Government bureaucracy and changes to legislation surrounding My Health Record, Wanngi has suffered from countless setbacks. Therefore, we’d like to see from the next Federal Government:
Clarity around approval processes for innovative tech companies – Wanngi has constantly been seeking clarity around the My Health Record approval process, and more transparency around approvals is critical for startups like us relying on red tape ending.
Greater support for R&D for small businesses, especially in regards to fulfilling requirements. We were required to undergo an extensive process by engaging expensive consultants to realise any tax relief. The startup community would benefit from funding support for this process.
A stronger focus on allowing innovative startups to empower consumers with technology solutions, and encouraging them to use digital technology to complement existing government services.
Real tax benefits that are easy to process for genuine startups that are pre-revenue. Eg Contributions to offset heavy wages bills employing Australians, (to meet R&D tax criteria). According to research by SmartCompany, 25% of jobs by 2026 will require STEM, and if Governments do not support startups NOW, it will have a major impact on our future economy.
As a fintech and small business, we believe the next federal government needs to provide a clear commitment to supporting technology and innovation centred businesses. This mainly comes down to the R&D scheme, which is currently very difficult and costly to navigate, particularly as a small business.
By focusing on reforming R&D incentives, the government can help new businesses, and existing small businesses and startups, to continue creating the innovative services our economy runs on.
From a wider policy perspective, we believe the government also needs to take faster action on open banking in order to help the financial services space. Open banking will really support innovation in the fintech sector specifically, helping to level the playing field and provide more options for consumers when it comes to managing their finances.
Along with this there needs to be more regulation of payday lenders. This predatory practice is putting millions of Australians into a financially vulnerable state, and the government isn’t doing anything about it.
The next federal government needs to take action by regulating how payday lenders operate, ensuring they can’t create debt cycles for those they lend to or take advantage of those in difficult situations.
Payday lending has gone on for far too long without any regulation, and while the Senate Inquiry into Financial Hardship was a good first step, more action is needed here.
Startups and small businesses are the backbone of growth in our economy, and we need a government that takes this contribution seriously. There are a number of serious issues facing businesses that are not being addressed by current policies, and these need to be tackled in order for Australia to truly be known as a place of innovation.
As a starting point, R&D is still a top priority. The current R&D scheme is still lacklustre when it comes to start-ups and small businesses. We are not even close to being competitive on a global level when it comes to R&D incentives — those in the UK, for example, allow SMEs (who really drive employment, innovation and growth) to claim up to a 230% deduction.
Another area where we’re lagging is the significant taxes business owners and founders incur. Many Aussie startup founders are beginning to realise that they will face the same capital gains tax (CGT) as a passive investor if they go on to sell their business down the line.
However, unlike real estate or other investments, which tend to be passive assets, founder-run businesses require an active role to be larger contributors to the country’s growing economy.
We have schemes such as investing in Early Stage Investment Companies (ESICs) for early stage investors which provide capital gains exemptions and tax write-offs but nothing for the founders.
This, coupled with outdated R&D policies, are two critical policy areas that startup founders need to see prioritised by the next government, or else Australia risks losing great founders and businesses to economies who are more supportive of innovation.
Co-founder and Head of Growth & Insights, WithYouWithMe
No matter the industry, almost every founder I speak with has the same issue somewhere near the top of their list – talent. Too many startups are struggling to find the right people to help them grow, which anyone who has tried to hire good developers in Sydney can attest to.
A new government should be looking to address some of these skills gaps and help fund the training and development of Australians to plug these gaps. Sure we can look at bringing in skilled talent from overseas but the economy is going to get the biggest benefit from reskilling our workforces for future needs, which startups will be driving.
Any government who can help solve talent issues for Aussie startups will be looked upon very favourably by the community.
CEO and Founder, FluroSat
There are three key areas where I’d like to see a strong focus on from the next federal government.
Firstly, I think it’s critical that pilots such as the Global Talent Scheme (GTS) are continued. Technology is continuing to rapidly evolve, and as this happens, demand for relevant skills will still manage to outpace supply in the market. Startups need access to talent to support and fuel rapid growth, and the GTS is just one way to help this.
Secondly, the federal government should reduce red tape on visa application processing time and high levy costs relating to visa applications, as this will help to bring talent through the door.
The red tape can be a huge headache for many startups and puts potential risk on the business as an additional point of pressure and uncertainty. For example, I’ve been waiting since December last year on the processing of my submission of Expression of Interest for the Entrepreneur visa.
I’ve not yet received any feedback or indication on how much longer the processing will take.
Finally, we need more help and assistance schemes in bringing innovative technology to industries that are ripe to benefit from digitalisation, for example the agriculture industry.
FluroSat’s recent successful bid for a three-year CRC-P grant with its consortium of partners is a great example of this, however it’s essential that schemes like this continue.
CEO & Founder at Lumi
We are not only a lender to small businesses, but we are a small business ourselves. As such, we would like to see more support within the SME sector.
One area where we believe there is room for change is in the labour market. As an employer, we would like to see a liberalisation of the labour market. In areas where we struggle to recruit locally, we would have liked it to be simpler to recruit globally.
We compete globally but are restricted with whom we can hire. We would also like to see a public discourse move away from nativism and populism. Australia is reliant on an inflow of immigrants for its continued prosperity.
It’s an aspirational country for immigrants with a world-class tertiary education system (tertiary education is Australia’s third largest export after iron ore and coal), and we can attract the best and brightest to our shores.
Co-founder of Shortlyster
Any incoming government needs to ensure the policies they draft are conducive to ensuring Australian entrepreneurs stay in Australia and don’t move offshore. I would like to see the government bring in greater tax reforms and incentives to help businesses grow and foster more innovation.
Most entrepreneurs are happy to pay a reasonable amount of tax but policies aimed at threatening to remove the incentive from entrepreneurs that are risking capital (and ultimately creating new jobs in the process) will inevitably result in more entrepreneurs leaving Australia and moving to tax favourable and business supportive jurisdictions, such as the UK or Singapore.
Ultimately, the reason why there is a ‘brain drain’ in Australia is because some of our best people leave to pursue opportunities outside of the country, especially to places with higher salaries and lower taxes.
To ensure a thriving startup ecosystem, we want to ensure we support our entrepreneurs and risk-takers and not scare them away.
Managing Director & CEO of mPort
Overall, I’d like to see a focus on ensuring that the Australian economy stays on track and continues to grow.
We’re in a much envied position of having uninterrupted growth for the last 26 years and it’s going to be harder to keep that up. In addition to this, I’d like to see no changes to the capital gains tax system – I know this is an added motivator to many entrepreneurs deciding to leave high paying jobs and move to start ups.
It would be also good to see a reduction in the cost of sponsoring offshore staff – Australia has an acute shortage of technology staff and it’s hard for startups to be able to sponsor key members.
Lastly, regardless of who gets elected, I’d like us to focus back on being aspirational and wanting to do better than what we are today.
Too much of this election has focussed on negativity around success and I’d hope that regardless of the outcome, we can all move to a society that aspires to do better across the board.