First Aussie venture capitalist joins Innovation Australia

Australia's first venture capitalist, Bill Ferris, has been selected as the new chair of Innovation Australia. He plans to use his influence to help stimulate the start-up sector and encourage more young people to take risks and become entrepreneurs.

Ferris, regarded as the father of Australia's VC industry, has been appointed to chair the independent agency established to improve Australia's innovation performance.

He has been appointed to a three-year term and is expected to play a key role in the execution of he government's innovation strategy.

Minister for Industry, Innovation and Science Christopher Pyne said Ferris is the ideal candidate for the role.

“A former chair of Austrade and for 12 years the chair of the Garvan Institute of Medical Research, Bill is a highly respected veteran of venture capital and private equity in Australasia," he said.

“He has extensive experience in the venture capital field and founded Australia's first venture capital firm in the 1970s. Bill has been a key adviser as we develop the Innovation and Science Agenda, and will continue to be so as we work to implement it."

Speaking at a press conference announcing his appointment, Ferris said a key focus will be increasing activity in the start-up section of the innovation food chain.

“The more we get happening in that area with seed capital and very early stage venturing will be a good thing," he said. “You've got to accept failure as well as successes in that end of it. But without more of it happening, without more collaboration between entrepreneurs, academics, here and abroad, we won't get it."

As part of these efforts, the government will be evaluating whether the income tax deduction scheme can be expanded to provide greater compensation for investors in high-risk projects such as start-ups.

Another reform idea raised by Ferris involves loosening restrictions on trading while insolvent to help start-ups attract skills onto their boards during the early, high-risk stage of their corporate lifespans.

Ferris has previously also been outspoken about what he sees as a fear of failure in Australia that is hampering innovation. Responding to a question about how Australia can encourage more people to take risks and become entrepreneurs, he said this is a complicated question with no easy answers.

“People have talked about early stage education and intervention about what is possible and the STEM subjects may help people, will help people's capabilities to participate in a digital world that has quicker paybacks often, both for failure and success, than the traditional business models, which take a longer time characteristically," Ferris said.

“But I think it is happening. I think it actually will be more of a bottom up thing. As much as it is great to have senior ministers and a prime minister talking about this and believing it and pushing it, I've actually got more confidence in the bottom up resurgence of doing it for yourself, getting out there and giving it a go."

Pyne said the government's national innovation and science agenda, which is expected to be announced in December, will have helping start-ups raise capital as a key theme.

Other areas of focus will include attracting some of the 20,000 Australian innovators working in Silicon Valley back home, improving the skills base in science, technology, engineering and mathematics (STEM) and better facilitating the commercialisation of research.

Pyne said the strategy is likely to involve substantial changes to Australia's tax code and corporate law to facilitate these goals.

Image courtesy of Chuck Coker under CC