Burgeoning innovation culture an opportunity for investors: Equitise

By Lucy Dean

June 08 2018
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Australia may lag behind Silicon Valley when it comes to start-up culture, but the growing space is presenting increasing opportunities, an equity crowdfunding company has said.

Chris Gilbert, managing director and co-founder of Equitise, which facilitates investment in start-ups and businesses, told Nest Egg that while Australia isn’t quite at the level of Israel, the UK or the US when it comes to innovation, Australia’s “evolving” landscape supplies opportunities.

Responding to questioning around whether Australia lacked a strong business mindset, as Bernard Salt has previously opined, Mr Gilbert said, “I think that it definitely is true to a certain extent.

“It was far more true when I was getting in to the start-up environment myself working at Deloitte about six years ago.”

However, the days of considering start-ups a risky move are “definitely gone”, he said, pointing to the amount of money funnelled into venture capital.

“There has been a bunch of venture capital funds starting over the last three or four years and we've got $2 billion worth of new capital being allocated by superannuation funds and various other funding mechanisms going in to venture capital,” Mr Gilbert said.

“So the factor of risk around [start-ups] and not innovating has definitely changed.”

Continuing, he said even the casual bystander can tell the space is improving just by the sheer number of people wearing start-up t-shirts in the Sydney CBD.

With this growth in mind, he said Equitise sees itself as a channel for funding and support for start-ups.

“Equitise is another name for accessing capital from untraditional sources like venture capital and strategic investments from banks, using channels of friends and family where you can transact easily online,” Mr Gilbert said.

“Really democratising investment and enabling anyone to invest in these, cool, potential high growth businesses.”

He said Equitise hopes to help investors close the “valley of death funding gap” for start-ups.

The $1-5 million funding gap can be difficult to fill, he explained, as anything less than $1 million can be filled by deals with friends and family, while anything above $5 million can be addressed with debt financing or venture capital.

“The crowd funding sort of bridges that gap and enables people to transact more easily,” Mr Gilbert said.

“And by connecting those funding mechanisms, hopefully more businesses will be freed and will drive further innovation.

“We're really just trying to break down the walls and some of the complications to starting a business, which include capital.”

He said awareness around equity crowdfunding is improving as more people invest, with most investors putting in between $2,000 and $5,000.

“It's affordable. But we're looking at it as an alternative to putting money into a small cap stock on the NASDAQ and now they're now thinking instead of putting it in that type of risky type of asset class, why don't I put it in to the cool product company that I have heard of, like a beer brand or a gin label or something similar,” Mr Gilbert said.

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