Undeniably the first place that comes to mind when you think of a thriving start-up ecosystem is Silicon Valley. Famous for its core entrepreneurial spirit and revolutionary technologies, Silicon Valley exemplifies the need to innovate and the wealth that can be created by doing so. What may not enter your mind is the bountiful opportunity Melbourne offers to create its very own start-up eco-system that will immortalize this great country and outshine the competition.
First and foremost, the economic conditions within Australia are outstanding. Victoria boasts one of the sturdiest economic environments observed in the modern world. The greater state of Victoria exhibits phenomenal economic power, with a state economy of $USD375B Victoria outshines even Singapore. Victoria is one of two Australian states to possess a triple-A credit rating from agencies Standard & Poor’s and Moody’s, a rating we have maintained for the past ten years. With an unemployment rate of 4.8% in 2018 whilst also remaining recession-free for over 20 years, the economic conditions within Victoria have steadily supported Melbourne and its business sector. Finally, while Melbourne only represents 0.13 per cent of Australia’s total land mass it accounts for 6% of Australia’s GDP, contributing 46 times its land mass in economic activity. With all of these factors combined it is no wonder that six of Australia’s companies decided to establish their headquarters in Melbourne.
Stable and encouraging economic conditions have been an influential factor in the development of Melbourne’s thriving start-up scene. With an estimate of over 2000 start-ups from seed stage to high-growth enterprises, there is a substantial community of invigorated and intelligent entrepreneurs actively developing their IP. LaunchVic also reports that to support these start-ups there is currently a network of over 25 accelerator programs in Victoria, with new programs constantly being developed. The start-ups coming out of Melbourne aren’t just numerous in quantity either, the quality of investment has irrefutably been proved over the last 4 years, with 4 exits over $USD100M and 1 exit over $USD1B. For such an immature ecosystem constantly combating a conservative investment culture this is a commendable achievement.
The immaturity of Melbourne’s ecosystem has been defined according to the Genome report prepared with assistance from LaunchVic. According to this report, Melbourne is currently an activation phase ecosystem, which Genome illustrates graphically as demonstrated below. However, although our start-up ecosystem still remains in the first stage, the human capital available to founders in Melbourne is far beyond that. Genome’s research found that ‘Melbourne fares well overall on our measures of Global Connectedness,’ with founders in Melbourne having above average connections to the top seven global ecosystems. The result of these two factors is that we are on the verge of globalization with pre-existing connections to current leaders in the start-up space, placing us in an advantageous position to seize this opportunity.
To attract the people required to achieve quality globalization while concurrently creating a prestigious culture of investment, there must be an accompanying lifestyle available. This is where Melbourne shines. Continually ranked as one of the top three most liveable cities in the world, Melbourne is unique in its complete blend of socio-economical areas. Firstly, Melbourne’s’ CBD has one of the most diverse, globalized cultures in the modern world. This is evident everywhere, from the ethnicity of people on the street to the restaurants and cafes, even in the entertainment available. Melbourne truly is an incredible blend of culture, which is what makes it so alluring. Any person who enjoys experiencing different worldly cultures will find Melbourne has more than enough to offer. Moving out into the suburbs, it is evident that this cultural amalgamation is partly a result of geographic diversity. With fertile soil that has supported rich wine-making grapes as well as beautiful bays, prime for beach relaxation, Melbourne has borne many fruits. As such, Melbourne offers a remarkably broad range of living providing great lifestyle options to everyone, while simultaneously offering decadence for the more affluent individuals.
As a result of Melbourne’s undeniable liveability, we have one of the leading international student populations in world earning Australia $31.9B in fees in the 2017/18 FY. Major universities such as the University of Melbourne and Monash University are largely to thank for the influx of international students as these universities offer their students a world-class education. The QS top universities report has found the University of Melbourne and Monash University to be ranked 39 and 59 respectively, an admirable achievement when considering the youth of the universities and Australia as a whole. With notable alumni such as Professor Gabor Kovacs AM, who pioneered integral research into IVF and other medical, and Emeritus Professor Gillian Triggs, who went on to become president of the Australian human rights commission, Melbourne universities have educated high achieving, forward-thinking graduates.
From a business perspective, Melbourne has a unique advantage- the time-window the country sits within. Being within a five-hour time window of Singapore, Australia sits within an exceptionally collaborative time zone with access to the deep pool of wealth that exists within Asia. Within this five-hour window exists one of the greatest emerging economies and largest potential middle-class markets in the world. The connections to Asia are exceedingly advantageous, especially since Asia-pacific has contributed the most to the growth of the HNWI population, being within this growth zone is something that can be leveraged to create strong relationships between these regions. Access to priceless connections like these should be an utmost priority for companies within the investment management space due to its financial prospects.
So, the question of ‘Why Melbourne?’ is one that is easily answered. All the required elements to create a one-of-a-kind start-up ecosystem are present in Melbourne, with the lifestyle, economic conditions and talent all coexisting in one place. These factors and their interaction in our modern dynamic socio-economic landscape makes now the perfect time to capitalize on these developments giving answer to – ‘Why Melbourne.’