The NSW government has ruled out funding the leading survey of Australian startups again and will instead focus on contributing to a national dataset, casting doubt on the future of the popular Startup Muster report.
The report, which ended when federal funding was pulled in 2018 but returned last year with NSW backing, must now rely on private sponsors and volunteers to survive.
Its findings go beyond metrics like capital raises by surveying founders on specifics like why they leave Australia, who they are hiring, fundraising methods and their interactions with the wider innovation community.
Over a decade the results have been an important fixture for the startup community and relied on by policymakers, while agencies like the CSIRO and IP Australia use the survey to supplement their own research.
“Startup Muster provides better data for better decisions,” says founder and entrepreneur Murray Hurps, who runs the survey.
“It’s never going to be perfect data, but it does answer a very broad range of questions where organisations currently have no data.”
Mr Hurps, a former Fishburners chief and now the University of Technology Sydney’s director of entrepreneurship, says 2024 has been the toughest year since he started Startup Muster in 2013, but he’s grateful for the private partners that have filled the gap.
“The work deserves to be done, so we’re doing it anyway, and will be working to ensure the work is worth continuing,” he told InnovationAus.com.
Without long term funding in place, NSW Liberal MLC Jacqui Munro last week moved a motion to have the NSW government step in again but was voted down by the Minns government and the Greens.
“Everybody agrees that the Startup Muster report is very useful…. Alternative options are now being put in place,” government minister Penny Sharpe said.
Other government MPs said it would be inappropriate for the state to fund a national survey.
“If we are going to fund something akin to the Startup Muster report, we should do it with its entire focus on NSW,” Labor’s Cameron Murphy said.
Ms Munro said the work should continue to be done by the startup community and the relatively small investment – the government contributed $145,000 to the last report – delivers a valuable resource.
“It was and is an incredibly important resource for this state, to the point that the Innovation and Productivity Council was using it routinely as a source of information to have a basis of fact,” Ms Munro said.
“This was and is a recognised source of credible information across the industry.”
The NSW government is instead working with the federal Industry department on a national startup data project while finalising a new ‘Innovation Blueprint’ for the state.
The national data work is part of a response to a 2019 review of innovation metrics that warned of major data gaps. It was ignored by the then Morrison government but released by Industry minister Ed Husic in 2022.
It has never received a formal government response, but its findings have triggered some changes in the background, including a ‘National Startup Data Project’.
The Industry department declined to answer questions about the startup data project when approached by InnovationAus.com, but it is understood to involve states and territories collaborating on on data and definitions for startups. Intended to assist policy makers, the national work has taken several years already, has no dedicated budget and is yet delivering a public dataset.
If it does arrive, Mr Hurps fears it won’t offer the qualitative information Startup Muster has regularly produced, while the quest for a single source of truth could delay insights founders and policy makers need now amid investment drops and increasingly interventionalist governments.
“The tech-enabled startup environment moves quickly, and won’t wait for the perfect comprehensive data collection approach. A combination of approaches is needed to identify the progress, challenges and opportunities,” Mr Hurps said.
“If it takes me working weekends for six months of the year then that’s what it’s going to be, and I remain deeply grateful for the support of all organisations that have made Startup Muster possible over the years.”
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