Venture capital fund for entrepeneurial Australia

The entrepreneurial environment in Australia can be improved with the introduction of a publicly supported venture capital (VC) fund, according to the Institute of Public Accountants (IPA).

In its 2015-16 pre-Budget submission the IPA has recommended that the Federal Government introduce the VC fund by either providing a significant proportion of funds to assist VC managers to attract other institutional investors to publicly supported VC funds or, by becoming an institutional investor in a range of individual VC funds.

“This level of support by government to small business equity finance will improve small business innovation and entrepreneurialism,” said IPA chief executive officer, Andrew Conway.

“It will also act as a catalyst in identifying and overcoming hurdles to successful and profitable investment.

“Many young firms face funding problems, particularly in uncertain technological or new knowledge environments because of their unattractiveness to bank lenders.

“Australia must recognise the fact that it is a lost opportunity to the economy when innovative firms with high commercial potential are constrained by the absence of external finance.

“Any government with a strong commitment to economic growth via research and development and investment which facilitates greater enterprise and innovation activity must ensure that early-stage venture capital finance remains available to high potential, young firms.

“Otherwise, we risk a reduction in new commercialisation opportunities stemming from national investments in science and technology,” said Mr Conway.

For the IPA’s complete pre-Budget submission go to /2015budget