As of September 2024, Australia is not officially in a recession, but it is facing significant economic challenges. The country has entered a per capita recession, where GDP per capita has declined for two consecutive quarters. While overall GDP is still growing slightly due to influx of new migrants (528,000 in 2022–23 to 395,000 in 2023–24), the forecasted 2024 GDP growth could be 1.3%!
Rising interest rates (current official cash rate is 4.35% and RBA may keep the rate in this level during 2024), inflation rate (raising from 3.6% to 3.8%), and economic uncertainties (iron ores pricing fell from US$140 to 90+) have made Australian investors more cautious and sometimes worrying. The uncertain economic outlook would further discourage capital allocation towards high-risk ventures like startups, i.e. analysts expect these conditions to persist into 2024, heightening concerns of a broader downturn.
So, are there anywhere that the Australian Startup CEO could seek new support and fund sources?
My Starthub.Asia CEO friend has recently updated me about how Hong Kong has been actively supporting startups through its major incubation hubs: Cyberport and the Hong Kong Science and Technology Parks (HKSTP). Below are what he has shared with me and hopefully it could be informative to Australian Startup CEOs and CFOs.
1. Cyberport: The Cyberport Incubation Programme provides startups with up to HK$500,000 in financial assistance, including an initial working capital grant and performance-based funding. It also offers rent-free office space, access to shared facilities, and opportunities for networking with investors and industry leaders. This programme focuses on digital technology startups that align with smart living solutions, such as e-commerce, education, and healthcare.
2. HKSTP: Through its HKSTP Venture Fund, HKSTP has supported over 1,700 companies (local and international), provided direct investments and facilitating co-investments with private investors. The fund has an AUM of HK$1 billion, with over 4,500 investment matchings made since 2018. In total, HKSTP companies have raised around HK$93.7 billion in funding.
Both organizations play a crucial role in Hong Kong’s strategy to build a vibrant tech startup ecosystem by providing funding, resources, and international exposure for startups.
If you are interested to discuss how Australia Startup/Scale-up to go out for new funding sources and market opportunities especially in the GBA, refer to my previous posts please write email to [email protected]
