Labor’s $14.6 million Startup Year initiative is a positive step for budding entrepreneurs, Australia’s university sector says, but industry leaders say the scheme must be designed to reach founders from all backgrounds.
The Startup Year initiative promises to provide income-contingent loans to 2000 students, helping them develop their business ideas in accredited university accelerators over the course of a year.
The plan promises to deliver financial backing through the existing HELP system, providing loans of up to $11,401 a year.
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Would-be founders now have a “fantastic” opportunity ahead of them, says Luke Sheehy, executive director of the Australian Technology Network of Universities (ATN).
ATN members include Deakin University, the University of South Australia, and University of Technology Sydney, which host incubators, accelerators, or university-wide programs assisting student entrepreneurs.
“We know that entrepreneurs need mentoring and support from, from academics and other businesses, and they’re going to get that if they stay on campus with us for another year,” he said.
But the Labor government should ensure that issuing HELP loans does not act as a “disincentive” to the scheme, Sheehy says.
“Debt is still a live issue for students who are already making a significant contribution to the cost of their university education,” he said. “And we wouldn’t want this just to be something that only wealthier students pick up.”
ATN hopes to work closely with Labor on the implementation of Startup Year, he added.
Separately, the University of New South Wales, which operates the UNSW Founders program, has also embraced the government policy.
“Given that we know that almost all net new jobs in an economy are created by companies less than five years old, UNSW recognises that it’s more important than ever for us to support the next generation of Australian entrepreneurs,” said David Burt, UNSW Director of Entrepreneurship.
“In addition to ‘job-ready’ graduates, we need ‘job-creating’ graduates.”
The ability for students to access Startup Year funding through HELP will expand the university’s offerings, he added.
“To date, it’s been philanthropic and grant funding that has enabled UNSW to deliver this support to hundreds of student entrepreneurs, and this new funding is a welcome addition that will boost our ability to support the next generation.”
Startup Year comes as part of a broader Labor push to increase Australia’s tech workforce, having pledged to reach 1.2 million tech-related jobs by the end of the decade.