Australia is in the midst of a renewed innovation drive, with a handful of heavyweight startups beginning to crop up, but according to Murray Hurps, CEO of the countryโs largest startup hub Fishburners, Australiaโs startups still arenโt very good at talking about themselves overseas.
โAustralians are terrible at talking about what we do, weโre very humble,โ says Mr. Hurps. โBut weโve got a great environment [for startups].โ
Itโs something he hopes to solve with the launch of a new startup hub in Shanghai later this month. The nonprofit wants to bridge the knowledge gap between Australian startups and the Chinese market, starting with a 50-seat coworking space.
Fishburners founder Peter Davidson moved to China three years ago, and will help launch the Shanghai office. Since the organizationโs launch five years ago, they have worked with over 620 Australian startups, including taxi app goCatch and online crowdsourcing platform DesignCrowd.
We caught up with Fishburners CEO Murray Hurps to learn a bit more about the Australian startup scene and what Fishburners is hoping to do in China:
Whatโs changed about Australiaโs startup scene since Fishburners was founded five years ago?
5 years ago there were some things happening in Sydney but they certainly werenโt working together and aggregating together in the way you see now. If you put a large number of people with large opportunities in a space together then the natural incentive is for them to collaborate and realize those opportunities.
Do you directly fund startups?
For Fishburners to do what it does, we have to not do a lot of things. To be an environment where [startups] are exposed to a maximum number of opportunities, we donโt want to be providing those opportunities ourselves. We donโt want to run accelerators and compete with other accelerators. Weโd rather welcome all of those people doing good things in a non-preferential way. The maximum surface area for luck is what we want to provide.
Why did you choose Shanghai for your first base?
Thereโs a lot going on in China, and because of the size you end up with specialization accross cities. Shanghai is obviously not the right location for a lot of startups, but as a first step this was the location we selected because it offered the highest potential to a broad number of startups. We also have partners within that ecosystem as well and that has been a helpful thing. Startups going to Shanghai [with Fishburners] may not end up staying in Shanghai, but they can be part of the Fishburners community then figure out what they need to and go to work in the right location for them.
Which entrepreneurs will be taking advantage of the new space in Shanghai?
Stay tuned for that announcement. Weโve had a few go over as part of The Next Unicorn TV show. I donโt want to send companies overseas. Iโd very much like for Australian startups to have something to offer those markets and have access to those markets, and also provide a really convenient opportunity for anyone who would like to work with the largest community in Australia.
What challenges do Australian startups face entering the Chinese market?
I think itโs understanding the opportunities. The strong areas in Australia at the moment โ in term of number of startups addressing them, are big data, IoT, health, education and fintech. They make up 10-12% of startups in Fishburners, but also outside Fishburners [in Australia] according to Startup Muster, which is the biggest survey of startups in Australia. You look at those projects and a lot of them are so applicable to China. For example a smart city initiative in China could benefit from a whole host of technologies developed here and vice versa. Communicating the challenges of China is the biggest problem in allowing them to be solved by people around the world, not just Australia.
Also Australians are terrible at talking about what we do, weโre very humble and thereโs a tall poppy syndrome in Australia where anyone who is successful doesnโt want to boast about it. But weโve got a great environment, we have a huge amount of capital for investment, weโve got a stable business environment, weโve got a wonderful education system, weโve got access to markets nearby that are enormous, weโve got entrepreneurial tolerance and increasing enthusiasm. Combine all those pieces and you have a great place to incorporate, as well as address a whole bunch of markets that are nearby
Following Uberโs recent China exit, thereโs a lot of discussion about what it takes to be a truly successful startup in the Chinese market. What do you think is that crucial element foreign startups need to succeed here?
[Uber] is a fantastic example. It illustrates the need for a local partner. To find someone with experience in that particular market with a reputation that is locally trustworthy and can help open doors for you is easily the most important thing a startup can have entering the market.
Are Australian startups attracting Chinese VC money at the moment?
Weโve run a lot of events where we have tried to connect people and weโre doing more of those to expose people to opportunities without pushing them in any sort of direction. In terms of Chinese investment, we havenโt seem much currently.Weโve had a lot of people come down [to Australia] and say โweโd like to pursue somethingโ, but it hasnโt happened, and I think opportunities have been missed as a result. I think making it easier to understand what is happening in Australia is what is really needed to make that happen. Startups still have to get on the plane, go over there and show why itโs worth their attention.
Where do you see the Fishburners and your Chinese operations in five years?
Thereโs a lot we have to understand that we donโt understand yet. Starting with 50 desks and expanding over time is a great way to start. By 2020 we want to allow over 1000 highly-scalable Australian startups to be created in Fishburner spaces. You couldnโt do that if they are just addressing Australian markets. At some point they have to get on a plane, go over and understand opportunities outside our nice little country here, and this is part of that puzzle piece. Hopefully we can allow Chinese customers and investors to benefit from our startups as well.
