Summary

Cheryl Mack and Maxine Minter reflect on the year 2023 and discuss the challenges and trends in the startup ecosystem. They talk about the tough environment for founders and investors, with many companies struggling to raise funds and facing down rounds. However, they also highlight the resilience and determination of founders who were able to survive and even thrive in the face of adversity.

The hosts discuss the increase in funding for female founders, although there is still a long way to go in achieving gender parity in the industry. They also touch on the growth of climate tech and AI as key areas of investment, with these sectors propping up the funding ecosystem.

Cheryl and Maxine express cautious optimism for the year 2024, noting the need for continued creativity and resilience in the face of challenges. They also highlight the importance of addressing issues of behaviour and inclusivity in the startup ecosystem.

Key Takeaways

• Challenges in the Startup Ecosystem (2023): The year was marked by difficulties for many companies in raising funds, with instances of down rounds reflecting a challenging environment for the startup ecosystem.
• Resilience of Founders: Success in these tough times was often attributed to the resilience and determination of founders, who demonstrated the ability to navigate through the demanding market conditions effectively.
• Funding for Female Founders: While there was a notable increase in funding for female founders, reaching a historical high, the conversation acknowledges that more efforts are necessary to achieve gender parity in funding.
• Growth of Climate Tech and AI: Both climate tech and AI emerged as standout sectors, drawing significant investments and spearheading innovation despite the broader economic challenges.
• Outlook for 2024: The year ahead is approached with cautious optimism. The emphasis is on the necessity for ongoing creativity and resilience to address and overcome upcoming challenges.

Quotes

- "I think ingenuity was a real theme. I'm excited to dive in today, obviously. Tis the season to be reflecting." - Cheryl Mack

- "The founders that survive this are the ones that we are so excited to back as investors." - Maxine Minter

- "I think optimism and holding on to a sense of optimism won this year. Pairing it with creativity, also really effective." - Maxine Minter

- "I think 2024 is looking cautiously optimistic. Cautiously optimistic." - Maxine Minter

Chapters

00:05 - Introduction to the podcast

00:25 - Reflecting on the year and the challenges faced

02:02 - Difficulty of raising funds and the resilience of founders

04:32 - Founders' determination to survive and adapt

05:08 - Employment Hero becoming a unicorn

06:31 - Tentative re-entry of international investors into the Australian ecosystem

07:38 - Gap between top founders and average deals narrowing

08:49 - Overpaying in the early stages of funding

09:05 - Australian tech facing criticism from the media

10:46 - Turning point in sentiment with SVB collapse and Milk Run

11:18 - Discussion about the impact of FTX and Sam Bankman-Fried's sentencing

12:13 - AI and climate tech propping up the funding industry in 2023

13:56 - AI adoption curve and its impact on the legal tech industry

15:01 - Tight capital environment in Q1 and Q2 of 2023

15:32 - Increase in interest and funding for climate tech

17:10 - Rise of climate tech-focused funds in Australia

18:19 - Lack of AI-focused funds in Australia

20:06 - Creativity in funding and rise of professionalized fund management

21:30 - Optimism about more fund raising in 2024

21:52 - Increase in funding for female founders, but still low overall

22:33 - Matching population demographics

22:48 - Lack of data on women-led...

This special bonus episode was recorded live at Fishburners as part of the Spark Festival in October 2022, to celebrate the launch of The History of the Australian Startup Ecosystem documentary. The event included a panel of eight guests, each representing a different corner of the startup ecosystem:

 - Malcolm Turnbull, former Prime Minister

 - Michelle Deaker, Founding Partner of OneVentures 

 - Larry Marshall, CEO of CSIRO 

 - Marina Wu, Co-founder of Earlywork 

 - Niki Scevak, Co-founder of Blackbird

 - Cheryl Mack, CEO of Aussie Angels 

 - Preethi Mohan, Founder of Niceto 

 - Alan Jones, General Partner at M8 Ventures

 - Panel host: Simon Thomsen, editor of Startup Daily

The episode also includes a short panel with members of the Day One.FM team, Adam Spencer, Andy Jones and William Tjo, in which they discuss the creation of the documentary. 

Mentioned in this episode:

NTP Technology Recruitment Company

NTP is the technology recruitment company that values community and who are invested in seeing the growth of Australia's local tech community.

What does the future hold for the Australian startup ecosystem? After five episodes focused on the past, this episode will finally be tackling that question and look towards the future. What are our unique strengths and weaknesses as a country? What are the key challenges and opportunities we face?

From investors, to academics, to government, to corporates and finally, to entrepreneurs - we highlight a variety of perspectives, looking at the individual roles each of us can play. Regardless of what seat we occupy on the bus, there is a place for people of all backgrounds in Australia’s startup community.

This series was made possible by our sponsors and partners.

Thanks to MYOB, AWS Startups, Investment NSW & CSIRO. 

We would like to acknowledge our earliest sponsors who decided to get involved with this story when it was just an idea on a piece of paper. 

Special thanks to UTS Startups & Murray Hurps for being our first sponsor, Western Sydney University’s LaunchPad and the Guild of Entrepreneurs.

ANSTO, Canberra Innovation Network, Curtin University, University of South Australia, LaunchVic, The South Australian Government's Department of Industry, Innovation & Science, The University of Adelaide’s ThincLab, The University of Newcastle’s Integrated Innovation Network, Flinders University’s New Venture Institute, UNSW Founders, UQ Ventures & James Cook University.

And to our promotional partners who have helped get this series in front of the startup community.

Startup Daily, Fishburners, Spark Festival, River City Labs, Stone & Chalk and Spacecubed.

Mentioned in this episode:

NTP Technology Recruitment Company

NTP is the technology recruitment company that values community and who are invested in seeing the growth of Australia's local tech community.