Fast-growth small and medium-sized enterprises stand to be the big winners from the Australian Federal Government’s proposed new National Innovation Fund, says the Australian Private Equity and Venture Capital Association Limited (AVCAL).
“We know that the nation’s economic prosperity rests on our capacity to nurture more competitive and innovative Australian businesses,” says Yasser El-Ansary, AVCAL’s chief executive.
“The government’s commitment to explore the creation of a new innovation investment fund to help support the growth of mid-market businesses through partnerships with experienced private capital managers is a major step forward. It is great to see the government acknowledging industry concerns around the funding challenges facing these businesses and working to find solutions,” says El-Ansary.
A new National Innovation Fund could help to create the right environment for greater private sector investment capital to propel the growth of small and medium sized-enterprises across every industry sector of the economy. During the recent election campaign, AVCAL released a policy blueprint which called for a renewed focus on policies to support ‘scale-up’ businesses which will drive new economic activity and employment growth into the future.
“What the debate around innovation has missed until now is that the most significant funding challenge confronting fast-growth businesses is the availability of later stage capital – amounts between AUD5 million and AUD20 million. If we concentrate on boosting the flow of capital into scale-up businesses, we’ll see a major economic payoff,” says El-Ansary.
“Every mid-market business is focussed on growth, expansion and improved competitiveness. Business owners consistently point to challenges stemming from the lack of capital available to support that growth, coupled with access to the skills and expertise to help them realise their potential in the global marketplace. Private equity and venture capital managers are uniquely positioned to deliver on both of those objectives,” adds El-Ansary.
AVCAL will work closely with federal government over coming months to develop the key design features of the proposed new National Innovation Fund to ensure that it delivers the right economic outcome for fast-growth mid- market businesses.
