Chief Science Officer Dr Cathy Foley, Science & Technology Australia CEO Misha Schubert and Tech Council of Australia CEO Kate Pounder praised the opening of the Industry Growth Program as “a powerful accelerator for more R&D” in Australia.
The $392 million Industry Growth Program aims to support start-ups and small business to scale their operations with economy-boosting R&D. It will provide matched grant funding of up to $5 million to innovative Australian businesses.
The program was officially launched by Industry and Science Minister Ed Husic and Minister for Small Business Julie Collins.
The new Industry Growth Program will support more and better R&D in Australia – and has been designed to help more innovative small businesses to become medium-sized businesses, said STA CEO Misha Schubert.
“It can turn more great Australian ideas and innovations into the products, services, and jobs of tomorrow – strengthening complexity in our economy and securing tomorrow’s prosperity,” Misha said.
“STA has long advocated for greater support to help outstanding Australian research to bridge the ‘valley of death’ to commercialisation and to connect up existing programs to deliver mass and momentum.
“This program will powerfully advance that goal – and be a powerful complement to Science & Technology Australia’s bold vision of training Australia’s first entire generation at scale of ‘bench-to-boardroom’ scientist-entrepreneurs.
“STA is also very pleased the new program will gather diversity data from the outset – something we championed strongly in the program design.”
TCA CEO Kate Pounder said while Australia has produced some great global success stories in the tech sector, scaling remains a major challenge for many Australian startups.
“The Industry Growth Program will provide much-needed support to help translate great ideas into more jobs,” she said
The new program supports the “Shots on Goal” research launched by the TCA at its inaugural National Tech Summit earlier this year, which revealed that the survival rate of startups in Australia at the scaling stage is much lower than in the United States. Without action on the investment environment, the research revealed that Australia will face a $53 billion scaleup funding gap by 2030.
“Australia has built a strong tech ecosystem over the last 20 years, with a vibrant tech startup sector and 28 unicorn companies valued at over $1 billion,” said Kate.
“However, Australia remains a challenging place to scale a tech startup compared to leading countries like the United States, particularly due to funding availability.
“This challenge is faced across the tech sector and is particularly pronounced in critical tech companies in capital-intensive sectors like quantum, AI and robotics.”
The Shots on Goal Report noted that fixing Australia’s scaleup challenges is vital because it is these medium-larger size firms that produce substantial economic benefits, including a significant number of jobs.
“Initiatives like the Industry Growth Program will be essential if Australia is going to become a global tech leader and improve its record on commercialisation and scaling,” added Kate.
“Past government funding programs have been credited as a key factor in the growth of some of Australia’s most successful tech firms, such as Canva and Atlassian.”
Catherine Livingstone AO, in her 2023 Ralph Slatyer Address on Science and Society, reflected on the opportunities the Industry Growth Program represents for the sector.
“The announcement of the Industry Growth Program is very welcome because, even to the extent that venture funding for early-stage translation is available, the dilution through low valuations and subsequent funding rounds means that control, and IP, passes to the Venture Capitalists who often represent offshore interests,” Catherine said.
“This is particularly important for IP in sectors which are just emerging, such as Space, Cleantech, and Quantum Computing and in which Australia has world leading IP and capability.
“We need to acknowledge that the innovation system is global and will not be optimising for Australia’s national interest.”
The development of Cochlear’s bionic ear
She reflected on the turbulence of business through the development of Cochlear’s bionic ear, and the important enabling function that the Government and Business sectors played in ensuring the innovation remained an Australian innovation. “In short, the Public Interest Grant saved the bionic ear from the Valley of Death,” added Catherine.
Today, the company Cochlear accounts for more than 60 per cent of the global market for bionic ears.
Dr Cathy Foley, Australia’s Chief Scientist, posed that Australia has a scale-up problem, not a start-up problem.
“Medium-sized businesses, key to innovation, are underrepresented and struggling. By international comparisons, Australia’s industry structure is heavily skewed to micro businesses.”
Dr Foley is also the Deputy Chair of the Industry Innovation and Science Australia (IISA) Board that today released their Barriers to collaboration and commercialisation report. In it, IISA shared findings that in 2017, 94% of businesses in Australia employed fewer than ten people. This compares to 62 to 67% in Germany, Canada and the United States.
“Our domestic market in Australia is small, and that’s why our businesses stay small,” said Dr Foley.
“Many priority industries in Australia have a low Revealed Comparative Advantage. These industries would require disruptive innovations to compete in international markets.”
About Science & Technology Australia
Science & Technology Australia is the nation’s peak body representing more than 115,000 scientists and technologists. We’re the leading policy voice on science and technology. Our flagship programs include Science Meets Parliament, Superstars of STEM, and STA STEM Ambassadors.
About the TCA
The Tech Council of Australia is the peak industry body for Australia’s tech sector. Providing a trusted voice for Australia’s technology industry, with over 160 members, the Tech Council comprises the full spectrum of tech companies.
