The election of the Coalition could be positive for Australian technology startups that have largely been neglected by the federal government, according to members of our startup scene.
“The voting community made the right call,” said Jonathan Barouch, founder of Sydney startup Local Measure. “The key difference [from Labor in charge] is you actually have folks who care and who are really engaged.”
While the Coalition could talk more about startups, Barouch said he believes the party will address the current lack of venture capital in Australia and alter the tax rules on employee share options. Changes to the rules made under Labor three years ago discouraged Australian startups from providing the options to employees, a key non-cash incentive.
A review of the tax rules that was announced in June by former communications minister Stephen Conroy was “too little, too late,” Barouch said.
Nick Abrahams, a Norton Rose attorney working on the tax issue for startups, said the Coalition has recognised the problem with employee share options and is likely to fix it.
“The Coalition will be positive for startups,” he said.
However, Hugh Geiger, founder of wearable telehealth startup Ollo Mobile, said he doubts startups will be any greater a priority for the Coalition than they were for Labor. The Coalition has its “emotional hot buttons of immigration and manufacturing reform and these other bigger, better lobbied issues,” he said.
Neither of the major political parties yet takes startups seriously, he said.
“I don’t think anybody in startup land is looking for a handout, but we just want to be on an even playing field with the rest of the world,” said Geiger. “Right now, it’s not very compelling to do it here, other than Australia is a great place to live.”
Startups have not been a priority for the federal government, agreed River City Labs managing director and StartupAUS board member, Stephen Baxter.
Labor’s inquiry into tax share options issue “was the only thing that really rated on the startup agenda at all,” he said. “It’s been a nil priority.”
Andrew Campbell, CEO of taxi-hailing startup GoCatch, also said he hopes the changeover will bring more support for startups.
“Hopefully, a new government means new initiative and right now Australia desperately needs to foster its technology innovation sector. What we would hope to see is significantly increased government support in the form of grants or incentives and a workable framework for employee share schemes.”
Several members of the startup scene praised the tech knowledge of Malcolm Turnbull, who is expected to become communications minister.
“He’s a professional investor and he’s been involved in technology companies and he knows that they grow fast,” said Geiger.
Turnbull and Coalition MP Andrew Robb have both been very involved with startups over the years, said Barouch. Turnbull even announced his tech policy at the York Butter Factory, a major startup co-working space in Melbourne, he said.
Turnbull has a stronger tech startup background than Conroy when he started on technology issues, said Baxter, who sold his first company to Turnbull. “He’s definitely an exceptionally intelligent man when it comes to understanding the technology and telecommunications in particular and also how that relates to digital media and publishing.”
“He just knows his shit, he really does,” he said. “Things can’t help but get better.”
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