An open letter to the incoming Government – Don’t forget the Startups – Dean McEvoy
Dear Mr Turnbull,
I write to you and copy Mr Hockey, Mr Bilson and Mrs Mirabella firstly to wish you all the best of luck on Saturday and secondly to highlight an opportunity to you all that at the moment nobody appears to own and could win a few extra votes for your party on Saturday.
As some background I have started a few startup technology companies over the last 10 years. Most were not too successful but I learned and kept trying and had some eventual success with Australia’s first group buying website Spreets.com.au. Spreets launched in Feb 2010 with just myself and 1 other person. A few months later I raised some money from European investors (As I couldn’t find any here). 10 months after launching my company we employed over 45 people and were approached by Yahoo!7 who purchased the business for around $40million. This industry which I started, now employs over 1000 people and generates over $500 million in 2013. There is an opportunity with the right incentives to inspire a generation of technology entrepreneurs and increase that number to over 500,000 employed and $109 billion by 2033 according to a report by PwC & Google. However I raised some concern in person to Mr Bilson at a lunch at KPMG that the needs of this industry are very different to a small business. It was suggested that your portfolio would be a better fit for fast growing technology businesses but from reading the press around your announcement at the York Butter factory the other day that focussed mainly on how the government will interact with the public more efficiently by investing more in IT and cloud services. This is great but it doesn’t really address the opportunity described above and I feel unless one of you decide to own it, it will be an opportunity that slips through the cracks.
So what can you do? Firstly fix the things that are broken. The current tax laws don’t incentivise people to take risks and be entrepreneurs and inhibit experienced people from helping new startups. The review of employee share plans is one area which I am glad to hear you are reviewing but there are more issues which I discussed on a public forum here that need fixing and it is why I wanted to bring it to the attention of Mr Hockey. It is also one of the reasons why my smart entrepreneur friends are moving to the US. Australian tax laws just make things too hard. There are some great things like the R&D tax credits which should stay but many things that just dont make sense.
One other reason people are moving is there is little support networks and sharing of knowledge for the elite technology entrepreneurs. That is why some leading technology entrepreneurs and myself have recently started the Endeavour Institute which aims to be like the Australian Institute of Sport for technology entrepreneurs but instead of gold medals we will build jobs and revenue. I have purchased a building on Stanley St Darlinghurst which I aim to utilise for this venture and we are currently securing initial funding from the top 20 technology entrepreneurs in Australia. 8 have already committed in just the first few weeks of us starting it.
The second and most important thing is to take ownership of this opportunity. Let it be known that you are aware of this opportunity and will sit down and help work out policies that make it thrive not let this massive opportunity slip through the cracks. I feel with your background in technology it probably sits best with you Mr Turnbull but I don’t mind who owns it as long as somebody does.
If any of you wanted to take me up on the offer and quite simply acknowledge the opportunity in the startup technology area, acknowledge that no current minister is really focussing on it at the moment and that you will address it. I know it would be a welcomed by the startup community. I will publish this letter on my blog so others in the industry can add their comments. If you want I will also push your response out to a very wide and very well connected audience to let them know of your support. I know at this last minute it could help sway a few undecided voters.
Of course I realise the last minute nature of this email so if it doesn’t reach you in time I would be happy to connect after the election and would welcome your feedback. As a registered voter and now business owner in Wentworth you can count on my vote and lets hope for a good victory on Saturday night.
Startup Adviser, Mentor & Investor