I was speaking at a business breakfast the other day, and the subject of the morning was ‘creating an enterprise culture in WA‘.
With our long history in successful resources and other entrepreneurial ventures, one might think that we had a great enterprise culture already.
And we do. If you want to develop a mine, Western Australia is probably the best place to do that from. The capital and investment bankers are here, the lawyers, accountants, exploration and commercialisation people are all here and they all have buckets of experience. We even have two mining billionaires, two of richest people in the country, including the richest woman.
The WA economy is worth about $235B, and about $70B of this is mining – that’s 30%. The largest sector, a sizeable chunk. Many other states and countries would love to have this undeniable source of riches.
But what I was talking about, was the early stage tech sector, which often gets ignored in all this entrepreneurial talk.
In the era of digital foreign invaders such as Google, Facebook, Airbnb, Netflix, Amazon, Apple, Uber and others, where are the Australian scalable businesses that can grow to multi millions and even billions on an idea and some lines of code? Businesses that can create enormous wealth, jobs and capital in a fairly short time frame (such as under 5 years).
OK, you may have thought of Canva (now based in Sydney) or Atlassian (also Sydney, and listed on the NASDAQ). Name ten others. Three. One.
I am genuinely worried about the Australian-owned tech economy we are going to leave our children. Nothing wrong with the digital vikings, I use them all, but, relative to their size, they don’t create many Aussie jobs or pay much tax in this country (hence contribute less to the broader economy, such as building roads, schools and hospitals, yet they are taking advantage of that very infrastructure).
We (as a country, state and community) need to do all we can to help our own brave Aussie scalable tech businesses along. They can do amazing things in a relatively short period of time. If given a helping hand.
They often don’t need much money to get them going, and yet can scale (or fail) fast. You may not have to wait years and years for approvals, plying multi millions in just to see if there’s something there. Often, a 6-figure sum is more than enough to get them out there, if not a 5-figure sum.
And the upside is tremendous. Canva got going 7 years ago and is now worth over $3B.
So, there I was rabbiting on about this, and I mentioned the fact that while over $9B was invested in all WA businesses in 2018, only 0.3% of this made its way to early stage tech businesses.
One of the audience members then shot to their feet to deplore my statistic (“I don’t know where you got that from…” … err from Business News and Techboard actually – see full sources below) and they felt there was plenty of investment in innovation and we were a fantastic economy doing great things.
While I agree with the positive sentiment (I love WA, the economy and the life here), I was a little bemused for a second. They did not like the stat, they so they were simply choosing to ignore it (fake news, obviously). In the era of Trump, this is what we have come to.
Which brings me to the point. We all live in our own bubbles, gathering information that the internet and social media already knows we like (we’ve previously clicked on it, liked it, searched for it, read it… so it sends us more stuff like that).
When we are confronted with some data that contradicts our world view, it’s uncomfortable. Our natural inclination is to rail against the source, query the author, or just flatly refute it.
The speaker from the floor was a well-healed stock broker. He’d done various ASX/mining deals before and was no doubt extremely well off. Had he had any experience with early stage tech startups, that were pre-revenue? Had he visited a co-working space? Been to a meetup? Had he sat down with startups to hear their views, and see what they were doing? Had he invested in them?
I doubt it.
But then again, what do I know about his world either? Have I done ASX mining deals? No. Do I live and work with junior miners, and truly understand what they do? No.
My bubble (which is predominantly early state scalable tech startups – I love em!) and his bubble (ASX listed junior mining exploration and commercialisation businesses) rarely meet. We rarely talk. We rarely listen to each other.
Even though we inhabit the same city, breathe the same air, drive down the same roads and sometimes frequent the very same breakfast events, we move in very different circles.
I reckon we could each help each other. But it starts with listening, and being open to data that may not conform with your existing world view, and decades of experience. I am open to this. I’d love to know more about his world. Perhaps I could teach him about mine.
Bubbles need to meet other bubbles. When they do that they pop, and something quite new happens.
- “Goldman, Freehills top deal tables”, Mark Beyer, Business News, 21 Jan, 2019
- “Australian Startups and Young Tech Companies Funding Report”, Techboard, 31 Jan 2019