BDO LLP | INTERNATIONAL TECH HUBS
02
THE TALENT POOL As with any other location, finding the right talent can be difficult. Australia’s relatively small population means that the pool is less expansive. However, that scarcity of talent is meted by the skilled workers that come in from the Asian market, from the UK and the U.S. Australia provides a great English-speaking location for these people to come and work, and the remuneration is strong, which attracts talent. GOVERNMENT SUPPORT Australia doesn’t have any particular surprises in terms of accounting standards or reporting, making it easy for businesses in the U.S. and other locations to transition into this market. There is also the appeal of the economic benefit of tax incentives for start-up tech businesses in Australia. Preferred treatment is given by the tax office if a technology is started in Australia, which encourages innovation. THE AVAILABLE CAPITAL There is no shortage of capital in the market. Innovative start- ups seeking angel investors or government grants will find the market very supportive. Businesses that are moving into their next stage can find global players in venture capital willing to invest. Established businesses find ample private equity investment, or list on the stock exchange. There’s plenty of opportunity for raising capital in Australia. There’s also the compulsory superannuation system, which sees every single employee paying 11% of their salary to superannuation that is then invested. That generates approximately $3 trillion of capital that has to find a home, and given the appeal of backing the next tech unicorn, tech businesses are often the recipients of that financial support. THE INVESTOR ANGLE Virtually every country is investing in Australia in some shape or form. The two main regions investing in Australia are the U.S. and UK – representing about 60% of interest - followed by Japan, China and Europe as a whole. Investors here often believe that if a tech business makes it work in Australia, with its small population of 25 million and extensive land mass, it has a product or service that can work very well in a larger population country. Investors are happy to back companies that can transplant easily into markets such as the U.S., which has a much larger populace. As a result, however, the Australian market is seen as a gateway, rather than a place to settle a business. THE COMMON MISCONCEPTION The perception of the Australian market is one of beaches and the outback and therefore that it isn’t a place where anything is happening. Once it becomes clearer that it has one of the most appealing exchanges in the world and is a leading location globally for investable capital, businesses are much more willing to establish themselves here. There have been 27 years of continuous economic growth in Australia – something that no other country globally has been able to achieve. Its robust economy, globally recognised banking system with deep capital markets are almost undiscovered because of this perception.
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