Queensland, the startup state: Brisbane ‘growing faster’ than Sydney as founders flock north

If you were asked to pick the two biggest startup states in the country, many founders would likely default to Victoria and New South Wales, but one Aussie capital is on the path to overthrow the Sydney-Melbourne duopoly.

You’d be forgiven for assuming Australia’s two largest capitals are the country’s best startup hubs. Sydney has long been at the top of the pile, with Melbourne yapping at its heels for almost as long.

However, data from the most recent Startup Muster report has shown Brisbane (and the broader state of Queensland) has remained the second-largest city for startup founders to base their businesses for the last two years running.

And according to Techboard’s 2017 funding report, the state’s startups picked up 21% of all capital raised throughout the year, though it did come in third to NSW and Victoria.

Though Brisbane’s boom may have seemingly happened overnight, the success of the northern city should come as a surprise to few. After all, the state was the first to appoint a chief entrepreneur to oversee innovation (a role since copied by South Australia) and the state government runs a number of initiatives to not only support local startups but also attract international startups Down Under.

Just this week, former chief entrepreneur and Shark Tank judge Steve Baxter was replaced by Everledger founder Leanne Kemp. In his parting letter, Baxter said it was clear founders in the state have “buckets of raw entrepreneurial talent”.

These talent-filled buckets are precisely the reason Sydney startup community Fishburners has decided to double its Brisbane-based operations, which started out two years ago with just five participants.

Today, Fishburners chief executive Pandora Shelley tells StartupSmart its Brisbane co-working hub is at capacity with over 200 desks filled, noting the growth has been blistering.

“It’s been a bit of a surprise,” Shelley says.

“Our growth in Brisbane happened a lot faster than in Sydney. We grew to 200 desks in Sydney over eight years, where in Brisbane, we did that in two years.”

Pandora Shelley. Source: Supplied

Shelley puts the growth of the ecosystem down to a few factors but places the government’s investment and involvement in the local scene above all of them. Programs such as HotDesQ and Startup Onramp, various available grants and workshops, and significant government investment has driven significant growth in the state, says Shelley.

The Fishburners boss also attributes some of the growth to the low cost of living in the city when compared to places such as Melbourne and Sydney, which she says means founders can spend less on rent and more on building out their business.

“All this support has had a knock-on effect, and we’re seeing key players move into the ecosystem now, such as Slingshot and Fishburners,” she says.

Fishburners will open another 150 desks in the precinct, with its current residents being primarily in the B2B, SaaS and app-based industries.

The sunshine state

While industry-watchers well within the Melbourne-Sydney bubble may look upon Brisbane’s growth with astonishment, for those involved in the scene for the past decade, the capital’s explosion is somewhat of a ‘well duh’ moment.

This includes Queensland entrepreneur and IT industry guru Martin Lack, who at 71 years old has seen the state’s business community evolve and flourish for the past 50 years.

Speaking to StartupSmart, Lack says Queensland has always been the entrepreneurial capital of Australia due to the state’s inherent challenges forcing its business owners to be more innovative and globally-focused.

“Forty per cent of the population of Australia lives in the south-east corner, so if you lived in Queensland you were naturally forced to export both nationally and internationally,” he says.

“If you wanted to grow your business, you had to, and the skills needed to export to Sydney aren’t much different to the skills needed to export to Seattle.”

Lack also says with Brisbane being the only real epicentre of the state, anyone with valuable skills seeking a life of entrepreneurialism was forced to come there, whereas in other capitals, innovation districts can be spread throughout the city.

“People in Sydney have always had an arrogant view they live in the best city, so they could never believe another city existed which could be better. No one ever understood why Brisbane was able to succeed as it has, it was contrary to our thinking as a society,” he says.

Looking to the future, Shelley is seeing nothing but growth for the region, saying Brisbane has some “great legs”.

“It’s growing faster than Sydney, and we think it’s got a large chance of being a contender to the other states. I would love to see the success of Brisbane take off,” she says.

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