High-profile start-up investor Steve Baxter said the previous alignment between Coalition and Labor policy meant that resourcing of start-ups was unlikely to suffer under any change in government, but that there were risks posed by changing power dynamics within the Coalition.

Wyatt Roy would be a loss to both the parliament and to start-ups if he lost his seat as expected, and the Coalition must work hard to ensure its innovation policy was not derailed.

"If there is a change in direction of the coalition to back before the leadership change then many things will be lost. The positive innovation narrative was very helpful," Mr Baxter said.

"People took notice and it was probably worth several large programs in its own right. Any leadership surely has to recognise that we can no more ride on the sheep's back than we can ride in the back of the coal haul truck ... For the sake of the future we need to go forward and embrace – not race back to the past and hope for another building boom in China."

Start-ups lamented the likely loss of Assistant Minister for Innovation Wyatt Roy.

Xenophon makes innovation demands

Potential government kingmaker Nick Xenophon meanwhile has eyes on innovation policy, largely focused on improving the fortunes of the ailing car manufacturing industry.

Nick Xenophon Team (NXT) media adviser Karina Natt told The Australian Financial Review the party will push for faster deployment of the $750 million remaining in the Automotive Transformation Scheme (ATS). NXT said the party had identified many innovative auto suppliers that could create jobs immediately if they got grants from the balance of the $1 billion scheme, which is due to close in 2018.


"For instance there's a business here in Adelaide called SuperShock which makes world-class shock absorbers for V8 supercars. With $1 million they could reorganise their supply chains to an export footing and create 100 jobs in the next 12 months," Ms Natt said.

NXT will also push for a full restoration of CSIRO funding, and a return to emphasising curiosity-led research instead of commercialisation."Nick wants to see a return to more pure research, the kind that ended up inventing Wi-Fi as a happy accident," Natt said.

Co-founder of Blackbird Ventures Niki Scevak said proposed changes to R&D tax rules were "insane". Jessica Hromas

Founder and CEO of Sydney-based startup Local Measure Jonathan Barouch said that while the Coalition's loss of Mr Roy, its Assistant Minister for Innovation, was "a knock," there were other MPs among its ranks that could step up to fill the void. He named Paul Fletcher, David Coleman and Angus Taylor as Coalition MPs who understood the emerging tech sector.

Policy continuity

"I think the fact that the opposition campaigned so strongly on innovation as well should leave the technology community with optimism that even in a hung parliament there should be bipartisan support for initiatives to grow our ecosystem," Mr Barouch said.

"If politics gets in the way of progress I think the community will rightfully call out both parties for not sticking to their election promises."

Australian Information Industry Association chief executive Rob Fitzpatrick said a hung parliament would slow the innovation push, but not stop it.


Independent federal Senator Nick Xenophon will push for faster deployment of the $750 million remaining in the Automotive Transformation Scheme. Paul Jeffers

A strong government driving an innovation agenda would have been preferable in terms of getting quicker results, but he believed the industry would not allow a hung parliament to put a handbrake on it.

"The private sector has done the heavy lifting and that will not stop. But what we need increasingly is for government to drive the right policy frameworks around STEM skills, small businesses and ensuring the right access to infrastructure be it the NBN or 5G network," Mr Fitzpatrick said.

Other start-up sector figures spoken to by The Financial Review suggested that entrepreneurs should not place too much weight on Canberra politics, and instead focus on their own efforts to establish their companies.

Kikka Capital CEO David Brennan said leadership changes in both parties meant uncertainty was nothing new, but he described the non-result in the election as a "debacle" for business, which had cried out for stability over everything else before the election.

Steve Baxter says there are risks posed by changing power dynamics within the Coaltion. Supplied

"We hope that the loss of Wyatt Roy does not herald the demise of the much hyped 'ideas boom' and support of start-ups and entrepreneurs at a federal level," he said.

"Australia is finally making changes that will put it into line with its international counterparts. But this risk of derailment shows even more so that start-ups cannot rely on politicians to fuel the growth of the sector locally."


PoweredLocal founder and CEO Michael Jankie said he felt no better or worse off from the election result, and that start-ups relying on government handouts were doomed to failure regardless of which party was in power.

"We roll with it, not bank on it ... It's all part of the hustle," Mr Jankie said.

"Wyatt Roy losing his seat is a shame, but successful start-ups shouldn't 't rely on government to succeed, they only use their changes in policy as an opportunity to accelerate their growth."

Co-founder and engineering lead at Proxima Dan Nolan said the difference between the two parties in government would be negligible regarding start-up policy. Most Australians already understood that innovative industries represented the future of the economy.

"Unless you're a luddite who longs for the days of Richard Alston, you've already gotten this big picture," he said.

"Both parties know what they're doing. It's just a matter for what that policy mix is ... or how many times we go back to the polls to figure out who leads for the next three years."

Local Measure founder Jonathan Barouch believes other MPs among Coalition ranks could step up to fill the void left by Wyatt Roy.