By Colin Jowell

It’s not exactly news that the home of innovation in the United States is not the commercial capital of the country. It’s not even a rivalry between San Francisco and New York – simply a well understood fact that the lifestyle and more relaxed, anti-establishment nature of the bay area proved to be far more fertile ground for breakthrough ideas.

And, at the risk of being pelted with rocks by the owners of many countless start ups, incubators, and funky desk shares (of which I count myself one), I’m beginning to suspect that something similar might be happening in Australia. Melbourne doesn’t just have a more progressive attitude to education, drinking, and well, almost anything at the moment - it might also be gaining the edge as the best place to be an innovative start up.

Ben Pfisterer, Country Manager for payments innovator, Square, has observed the trend first hand: “Melbourne has always had a strong and entrepreneurial small business culture and we're continuing to see a growing trend in tech companies establishing in Melbourne, from local companies such as Xero and Envato, to larger international technology companies like Square, Slack, and Zendesk. Melbourne has a rich history of small businesses and is renowned for its community of hard-working business owners with a genuine passion for innovation, which was one of the attractions for Square when we chose to set up our local headquarters here.”

Beyond the cultural factors, Danny Gorog, Director of Outware Mobile has observed some practical differences as well: “Based on our experience with recruiting at Outware Mobile I think sourcing experienced developers is tougher, more expensive and time consuming in Sydney. Average salaries are also higher across the board”.

And those practical differences extend to local government support: Victorian Minister for Small Business, Innovation and Trade, Philip Dalidakis points out that Victoria is “leading the country in small business growth with over 8,638 new businesses started in last financial year alone”. This he attributed to the “right combination of online and direct business support services through a range of programs including (the) $60 million LaunchVic startup initiative and Small Business Victoria’s workshops, seminars and mentoring.”

Which is not just political spin: Pfisterer reflects that Square has “a great relationship with Victorian Government since we first considered establishing in Australia a few years ago. They've supported us with everything from introductions to local businesses and talent, networking Square with other technology companies who are establishing themselves here, through to helping us select the best location for our office space”. 

It also doesn’t hurt that Dalidakis responds personally to a humble blogger such as yours truly, within hours of e-mailing a query. It’s this combination of the personal touch combined with tangible support that seems to be making a difference. 

Gorog observes that “the startup ecosystem in Melbourne is very strong with lots of incubators popping up all over the place. Richmond, in particular, is becoming a hot-bed for startups. Entrepreneurs like to be with other entrepreneurs so this is only heating up.”

The right culture. Affordable talent. Meaningful local support.   

Australia’s innovation capital may be further south than you think.