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'Silicon Beach': Google's plea for Australia's future

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Google Australia's managing director Nick Leeder says Sydney must become a "Silicon Beach" if it wants to be a major global city, but cultural flaws are holding us back.

"Just as New York created Silicon Alley and that entered into the lexicon, I think that should be an ambition for us," he said.

Australia not doing enough to support innovation ... Google Australia MD Nick Leeder.

Australia not doing enough to support innovation ... Google Australia MD Nick Leeder.

Mr Leeder made the comments at the City of Sydney's CityTalk innovation event at the State Theatre last night, where lord mayor Clover Moore announced her intention to act as a "broker" between investors and start-ups struggling to obtain finance.

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Mr Leeder said in a panel discussion that Australia was a "conservative thinking country" that was not comfortable with failure, but we need to adapt to the rules of the new world.

"If you take a big risk in this place you can face-plant very quickly and get punished for it ... here failure is seen as a terminal black spot," he said.

"We've all failed at things in our careers and we should be much more ready to understand that that is part of the learning process."

Google Australia's call for the nation to do more to support technology start-ups comes amid a major video series on the topic published by this website. View the full Digital Dreamers coverage here.

The City of Sydney opened up a creative and cultural hub for entrepreneurs at 66 Oxford Street in February.

Sixteen tenants including tech start-up AroundYou moved in and the co-working space has been such a success that Cr Moore is converting two more buildings on William Street to create more space for start-ups.

"People started collaborating almost as soon as they moved in. It was quite remarkable to walk around the building and hear their stories," said Cr Moore, adding that she was taking expressions of interest for the William Street property.

She said start-ups needed affordable space, advice, encouragement and support, but the biggest challenge was finance. A lack of venture capital is forcing Australian talent to go offshore.

To that end Cr Moore said she had asked her staff to "look at ways the city could act as a broker or blind date some of these venture capitalists with start-ups".

City of Sydney is following the lead of other co-working spaces such as Fishburners, which opened in April last year in a building in Ultimo and filled up with 60 entrepreneurs within six weeks.

"There's a real groundswell of start-up activity in the tech sector at the moment and that's attributed partly to just how cheap it is to start a tech business these days," said Fishburners director David Vandenberg.

"You can start a technology business these days with the money in the bank ... and as a result there's a lot of young businesses starting in bedrooms around Australia."

But Mr Vandenberg said the problems arose once start-ups wanted to get out of the bedroom and expand further.

"When they start looking for money they just find that the doors keep closing for them so they just end up inevitably looking overseas," he said.

Cr Moore concurred: "The people with that kind of money to spend are putting it into property, into mining, into exploration."

Mr Leeder expanded on his thoughts in an opinion piece published on this website today. He said the high-tech brain drain was not good for Australia's future but said the country had all the ingredients to create a world-class technology industry.

ABC managing director Mark Scott said Australia should look at building innovation the same way it built the film industry, which is no Hollywood but is punching above its weight on the world stage.

"If you go back 40 years there was a decision to really create and build a film industry ... in the range of new digital industries we need the same level of targeted approach and investment and education," he said.

"The film industry is the classic example. Really, eight films lose money, one film might make its money back but the 10th film makes enough money to paper over all the losses - that's the venture capital model."

TED curator Chris Anderson, who gave the keynote talk at the event, said he was "frustrated" that federal governments around the world were locked up and "unable to make decisions on our future" - but big things could get done at city level.

10 comments so far

  • There has been a graphic design start up in Chippendale in Kensington Street. The designers all pay $80 a week for a seat and a space, its a great place and we really need more of these spaces in Sydney! A number of the participants have gone on to bigger and better things.

    Commenter
    John
    Location
    Chippendale
    Date and time
    May 29, 2012, 9:29AM
    • Agree completely and with teh article. Ideas, Innovation and execution will give as huge boost to productivity.

      Sad to say most of Australia's largest companies really dont get it.

      Commenter
      Seriously
      Date and time
      May 29, 2012, 10:59AM
  • He talks a lot of sense.....the potential here to innovate is huge - a young, educated population, lots of bright and motivated immigrants, a healthy business services sector to support start ups, a fair amount of capital for investments, a generally positive outlook on life. So it's odd that we don't create a lot more; lots of us who've worked in the US especially (and even the UK, or at least London) are surprised at some of the more backward/conservative norms that seem to pervade in business here. Let's give it a go, we think we're good at that and need to reclaim our pioneer spirit in business

    Commenter
    pjh
    Location
    Wahroonga
    Date and time
    May 29, 2012, 9:31AM
    • I think those stated backward/conservative norms you speak of have prevented us from cultivating our own Lehman Brothers or Northern Rock.

      Commenter
      Nincompoop
      Location
      Behind you
      Date and time
      May 29, 2012, 10:03AM
    • Just need to change the mind-control-programming (TV) e.g. Masterchef is amateurs cooking - Iron Chef is champions cooking. I don't think there is an Oz Iron Chef comp...

      What is this country's fascination with watching amateurs?

      Commenter
      Mylo
      Location
      Bondi
      Date and time
      May 29, 2012, 10:31AM
    • Well said @Nincompoop !!
      And @ Neckbeard !!

      OZ does need a more entrepreneurial environment and attitude, but regardless, ultimately we need to generally go offshore to capitalise the opportunity.

      Commenter
      FastEddy
      Location
      Mars
      Date and time
      May 29, 2012, 10:46AM
    • London and New York, really? Are you suggesting that we adopt a model of speculative investment that has already been shown to be fatally flawed? Did you notice a little thing called the GFC? Or perhaps we could have all invested in the Facebook IPO? Have we traded the Cultural Cringe for an Economy Inferiority Complex?

      Commenter
      TJP
      Location
      Cambodia
      Date and time
      May 29, 2012, 10:59AM
    • Don't kid yourselves, guys.....the reason we have avoided the worst fallout from the GFC isn't because we have excellent robust business practices. It's just the good fortune to have the resources sector to carry us through, coupled (in the case of the banks) with them being small enough not to be global players and therefore avoid the worst of the global risks. I reckon we'd be better off if we had taken a bigger hit, at least we'd have less of the current complacency - that's what kills businesses in the long term.

      Commenter
      pjh
      Location
      Wahroonga
      Date and time
      May 29, 2012, 11:11AM
    • @Mylo

      Interesting observation - it's because grassroots entrepreneurialsim and innovation in Australia is quite impressive (and at least the food in Masterchef Oz ripped the pants off the ghastly fare of its British counterpart)...once you get to the top levels, however, mediocrity reigns supreme. Big corporates and government in Oz are collusive, flabby and indifferent, which is why so much talent slips overseas.
      There actually was an Iron Chef Oz though it didn't do very well...being O/S I never saw it but I also think it helps if you have a very large culinary pool of talent like Japan and the U.S. to keep churning out good challenges.

      Commenter
      the chef
      Location
      Red Dot
      Date and time
      May 29, 2012, 11:36AM
  • it's a bit rich for Google to be telling Australia how to do things - how about you start paying an appropriate level of tax for your local business before lording over us?

    Commenter
    neckbeard
    Date and time
    May 29, 2012, 9:32AM

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