NICTA, Australia’s information technology and research centre, will continue to focus on being a wealth generator rather than a revenue maker, in light of looming funding cuts, according to CEO Hugh Durrant-Whyte.
Last week’s federal budget confirmed that the government would only continue to help fund NICTA until the middle of 2016, a move the organisation had been expecting since late last year.
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While NICTA doesn’t rely on government funding, Durrant-Whyte says losing government contributions will certainly have an impact on the organisation.
He says NICTA’s primary goal is “getting good technology out the door” and building wealth for the country rather than revenue for itself.
“You would hope at some point you would get enough licensing income, corporate revenues, company sales to keep doing that,’’ Durrant-Whyte says.
On average, NICTA helps create a new startup every three months.
Last week it sold a company for more than “an eight figure sum”, although Durrant-Whyte would not elaborate on the details.
“Last year we spun out four companies, Saluda Medical being one, we probably put about $10 million into developing it,’’ Durrant-Whyte says.
“It is producing a medical implant that in principle can eradicate pain in the legs and back.
“It has the potential to be the next Cochlear [Australian maker of hearing products].”
After NICTA has got startups off the ground, by the time they make it to market, and after the company has raised more funding through investors, NICTA takes a relatively small cut.
“Let me be clear here, we already get a significant amount of revenues from external sources,’’ he says.
“The problem is none of that ever really allows you to fund the blue sky deep scientific research to come up with all this great stuff to start with.”
To help build the expertise required to commercialise some of that ‘blue sky research’ NICTA recently set up an office in San Francisco.
“Why did we start it? In the end what we lack in Australia truthfully is the skills and experience to figure out how to commercialise deep technology,’’ Durrant-Whyte says.
“Opening up that office is really a chance to say to our startups ‘go and find out what the rest of the world is doing’.”