Saw Deb Noller the CEO of building analytics company Switch Automation speak at the launch of Springboard Enterprises Australia recently and she mentioned that she finally felt comfortable calling herself an entrepreneur. “Even three years ago, nobody in Australia was comfortable calling themselves an ‘entrepreneur’ and that’s finally changing.”
When I was a kid I asked my Dad, “What does Uncle George do?”
“He’s an entrepreneur, son.”
“What’s an entrepreneur Dad?”
“Someone who isn’t quite comfortable having a proper job.”
Uncle George was actually an insurance salesman who was in the process of starting his own insurance business at the time. He was at the forefront of the second-generation of Australian entrepreneurs – the services entrepreneurs.
Australia’s first entrepreneur generation were explorers – people who went out into the unexplored vastness of Australia, ignored the indigenous owners of the land, and either dug value out of the ground or populated it with livestock and grain.
When we ran out of land, we hit our limit for entrepreneurial growth. Because of the cost of exporting our commodities, there were limits to the customer markets we could serve.
The second generation of Australian entrepreneurs arose from war.
Advances in electrical and communication technology brought about by World War II led to tremendous advances in the speed and complexity of information and trading networks for shares, bonds, commodity futures and news.
The same war also introduced the possibility of increasing household income by allowing women to work, in exactly the kind of operational white-collar work these new networks provided.
Electric appliances such as the washing machine, vacuum cleaner and dishwasher made household chores less time-consuming.
Electric typewriters, fax machines and computers provided white-collar work and the manufacture and assembly of plastic and FCMG goods provided blue-collar work for this new female workforce.
My Uncle George’s insurance business was powered by that growth – trading networks crossing the world provided the liquid trading conditions necessary to allow a small business to act as sales intermediaries for larger underwriters.
Uncle George was part of a second generation of Australian entrepreneurs who either replicated service business models they saw in Europe or the U.S., or unpicked the bindings that held departments together in a larger services organisation such as a bank or insurance company.
As soon as every town in Australia had a marketing agency, an insurance broker, a travel agency, a hair salon and a few cafes and restaurants, once again we’d hit our natural limits of entrepreneurial growth.
We were still limited to servicing our immediate geographic neighbours. The cost of exporting services overseas was prohibitively high. The majority of growth would be through rationalisation and efficiency gains. Until the Internet.
Australia is now beginning our third generation of entrepreneurs.
This third generation is driven by the truly global economy enabled by the Internet. For the first time, we have the opportunity to create new Australian industries not limited by the geographic availability of resources and export value of commodities.
We can unlock enormous value by disrupting existing industries, unpicking the technological, regulatory and commercial relationship limitations large corporations and cartels are bound by.
We aren’t limited to replicating good ideas we see in other markets and adapting them to Australia as my Uncle George did. We can prototype new ideas in Australia as a test-bed and then export them quickly and cheaply to the U.S., Europe and China using the Internet as our medium of transport and the increasing ubiquity of internet-connected devices as our marketplace.
We call these “tech startups”.
As it was for my Uncle George, this third wave of Australian entrepreneurs will struggle with suspicion and ignorance in their community, and also with lack of useful support from State and Federal governments.
Most of them will find greener pastures in the larger economies they serve and many will succumb to moving their IP and jobs to China, the U.S. and maybe Brazil and India. To Australia’s loss.
Most of all, the old media and service industry monopolies and cartels that hold sway over Australian economic policy will apply significant pressure to stamp out any threat to their dominance. Good luck getting a disruptive startup going domestically in media, transport, mining, banking, retail or energy.
One thing has changed for the better: Australians no longer need feel too embarrassed to call themselves an entrepreneur.
Entrepreneurs are in our popular media as something other than shady characters. Stars of popular culture are celebrated for their entrepreneurial skills as much as their singing or acting skills. Not all software developers are portrayed as shy nerdy types. Athletes can become tech startup entrepreneurs.
In the 1990s we all had a friend who was playing in a band and wondering whether to pursue music as a career. In the 2000s we all have a friend working on a tech startup idea part-time and wondering whether to pursue it full-time.
When Australians write as much code as song lyrics and movie scripts, the tech startup equivalents of our Daniel Johns, Cate Blanchetts and George Millers will bring much more economic value to our nation than the second generation of entrepreneurs.
If we support them, enable them and invest in them as individuals and as a nation.
Sign up to invest some of your discretionary savings in an angel investor program, ESVCLP fund, or crowd-funding platform.
Or just offer to put a few grand into your mate’s startup idea instead of the dogs, trots, horses, lotto, footy bets and Melbourne Cup.
Vote for a party that advocates pulling subsidies from old industries like agricultural and mining exports in order to back innovation in new industries like renewables and ecommerce.
And stop snickering behind their backs when they describe themselves as “entrepreneurs”.
Sorry Uncle George!