I was delighted to hear about the formation of ASIF, the Australian Science and Innovation Forum. As our Chief Scientist has often said, Australia does have terrific pockets of innovation and some great programs but our issue is to see these things happening at a larger scale. I hope ASIF proves to be another catalyst to getting that scale-up happening.
In my opinion, we do have a cultural problem in Australia in terms of innovation. But the nature and level of that cultural problem is overblown and sometimes used as an excuse. My actual experience is that the scientists I meet really do want to make the biggest possible difference to society with their work. That’s why they do what they do.
ASIF is giving a voice and some more experience to some of those brilliant people. Some State governments are getting on with really good new programs that are going to have big impacts. Victoria, for example deserves lots of praise for the voucher scheme and the three-year postdoctoral fellowships that allow for two years overseas and one back in a company in the State. Let’s see more of these type of programs that cater to the talents out there.
In the Federal sphere, there are some simple measures I think the government would have a very good look at. They wouldn’t cost the budget and they’d make a difference to the innovation environment in the country. A pretty small package of reforms might have a big impact in freeing up capital for early-stage innovation. The capital gains on options in start-up companies is a lose:lose situation. No one issues them because of the tax, so the government gets almost nothing anyway. There’s nothing more portable than an entrepreneur’s mind, so Australia is bleeding opportunity to other jurisdictions. When expansion of the start-up happens, we miss out on the jobs.
Just like not letting people ride bikes without helmets or make phone calls on tarmacs, we seem to assume the worst will happen – we have become too risk averse as a nation. This applies to our capital raising rules. For example, I can bet as much as I like online on a horse race, but crowd sourcing finance for a start-up – no way. President Obama loosened up crowd sourced funding back in the financial crisis. It should be possible to have a modern system that provides safeguards but encourages entrepreneurship.
If technologists get better at developing viable projects and the government frees up the ability to invest, then surely we would get more of the Australian pool of superannuation capital investing in early stage ventures. We don’t even need to convince the big funds – hundreds of billions is in self-managed funds, often with people who have excess capital for retirement.
In June, Chinese President Xi Jinping stressed the need for China to speed up its move to becoming an innovative economy, saying the direction is “innovation, innovation and innovation”. Australia needs to form a national compact to move even quicker and it is great to see ASIF up and running with this intent. Those of us with any capacity to support science entrepreneurs should give them every possible support.
Tony Peacock is CEO of the Cooperative Research Centres Association. He is undertaking a Monash University Churchill Fellowship in early 2015 on best practice in university-business relationships. The views expressed by the author do not necessarily reflect the opinions and views of ASIF.