It's no secret Australia is struggling to keep up with the rest of the world when it comes to tech start-ups. Let's compare ourselves with Israel -- with a population of just 8.2 million, Israel is known as the start-up nation.
Only China and the US have more companies listed on the Nasdaq than Israel -- worth a total of $40 billion. Israeli start-ups have transformed finance, entertainment, healthcare, media and many other sectors.
And Australia? With a population of 23 million, we have just one company in the tech unicorns list (private companies valued at $1 billion or more) -- Atlassian.
Investor and panellist on Network Ten's The Shark Tank, Steve Baxter told the Huffington Post Australia start-up companies Down Under need to be brave, risk takers willing to get moving with as many 'crazy ideas' as they can drum up.
"Everyone quotes Israel. It’s a country of 8.2 million with 7,200 start ups. So that’s one in a thousand people with a tech startup. If we were like Israel, we’d have 22,000 start-ups. So we need people trying new things. What we need is people trying a crazy range of ideas, appealing to a wide range of investors. I don’t believe there’s a problem with capital in this country," Baxter said.
Steve Baxter. Picture Supplied
When Prime Minister Malcolm Turnbull unveiled his Innovation Statement in December 2015, he said he wanted to drive a so-called 'ideas boom.' The $200 million innovation fund will co-invest in businesses that develop technology from the CSIRO and Australian universities.
The Federal Government is hopeful the fund will help create a modern, dynamic economy that moves away from the mining boom. Australians wanting to take ideas overseas will also be supported by a $36million 'Global Innovation Strategy' to kick start careers in Silicon Valley.
"What we need is more crazy ideas. People need to try harder and be brave -- we need ten times more ideas that are crazy that can, by the very definition, lead to failure. But we also need more experienced entrepreneurs so that we’ll at least be more valuable to employers further down the road," Baxter said.
"We don’t need another Facebook knock off. How do you grow a business from nothing, such as Instagram? You do it with a network. You’re using software and accessing a network. Most importantly, you need tech skills. If you don’t have tech skills in your core team, then you are buggered. If you don’t have tech skills -- get some!"
"Too many people have the impression you can just outsource to India. That is only occasionally a successful scenario. If you look at all the big companies, Apple, Google, Facebook -- they all had the ability to build the service themselves. Unless you have that in your team, you will struggle. It’s simple really; if you don’t have the skills, you have to get them."
Baxter likes to use Twitter as an example of a 'crazy' idea. When the social media network launched a decade ago, not everybody was convinced it would work.
"In 2006 some very brave souls launched a service to broadcast messages to anybody that cared to listen, the messages were limited to SMS size (140 characters) back in a time where most people had volume-charged accounts and the smart phone as we know it now did not exist. The backers in the first round of investment that Twitter took were either very brave or insightful. When Twitter launched, most people thought it was a quite crazy."
"But I'd hope Australian entrepreneurs would want to do something bigger and better than working for somebody else. Or they found a problem worthy of solving. There’s got to be an entrepreneurial spark in there. I often hear people say, ‘Nobody wants to fund my business’ and then they quit. So they blame an investor for not buying it. But if you had a product and the customer told you what they didn’t like about it, you would go and change your product. You wouldn’t blame the customer."
Culturally, Baxter believes Australia has a problem surrounding our notorious tall poppy syndrome.
"We tend to pull down successful business people. Also if somebody has started a business and it failed, they don’t deserve ridicule. The only time for ridicule is if they try the same dumb thing twice. Australia needs to change its attitude or we will fall even further behind."