Small businesses are the ones that create jobs. Often it’s the larger businesses that are cutting them. 80% of jobs created in the States post GFC are in the small business sector. The hot areas are bio tech and tech overall.
I attended a bio tech innovation breakfast this week, and the issues they described could have been spoken by any player in Perth’s startup scene:
- lots of great ideas, tech and businesses here
- too few ideas being funded, not enough venture capital
- in absence of capital, some having to choose the public listing route
- or the ideas leave Perth, or stay dormant
In trying to describe what is happening, I use the word ‘atrophy‘. Because that is the danger at the moment – with little or no funding, these ideas will either not get developed, or get developed elsewhere as others jump on the idea or the best ideas leave for funding opportunities elsewhere. Many of these ideas will not amount to much, but how would we know without getting enough of them going? A small business might create 4 or 5 or more new jobs almost immediately, for as little as a $50k to $150k investment. Depending how quickly the business gets sustainable, suppliers to that business will benefit, as will the clients using their new products and services. More employment, more growth, improved lifestyles, better products. A nice multiplier effect. The more such businesses get funded, the more successes we will have, and the more confidence and experience will develop among the community. A virtuous circle.
Atrophy describes the ‘partial of complete wasting away of a body‘.
We are in real danger of having the whole Perth tech startup scene suffer this fate. What a catastrophe that would be.
Picture credit: Mahabalipuram monument