Ladies and gentlemen, the events of the last month or so have made me pretty excited. To be fair, I was already pretty damn excited, as we all have been, but now my excitement is reaching unprecedented levels. If Big Kev were alive today, I don’t even think he could adequately describe how excited I am. We all know that we’re living in an exciting time, despite what Labor MP and occasional adrenaline junkie Pat Conroy thinks. He says he doesn’t “see how you can prove this particular time is the most exciting time to be an Australian”. To that I say “hey dude, you’d better step off”. In case you missed the memo, not only are we in the midst of an ideas boom (while enjoying all time high vibrancy levels) but to top it off, New South Wales has been proclaimed “The Start Up State”. What a time to be alive!
Ok, I admit it. I may be sightly exaggerating here. Or totally, even. The so called “Ideas Boom” has spectacularly failed at living up to politicians expectations. Unfortunately the whole thing has been more of a fail than Barry O’Farrell’s memory. Apparently, for the concept of an ideas boom to work, going around telling everyone how excited we are about it is not enough. You actually need ideas. The problem is too many are more concerned with feigning outrage over non issues, worrying about foreigners or taking the perfect selfie to contribute anything meaningful. Others are pre-occupied with their imaginary friends and don’t have any idea(s), while just as many have too big a chip on their shoulder they don’t even want any ideas. Christopher Pyne declared the innovation agenda would only succeed if the public embraced it. He was half right.
The few that actually do have ideas aren’t terribly inspired by their surroundings and would rather be anywhere else, never mind the new initiative may not even offer any appeal. I’m currently launching my own start-up and after perusing the website there’s nothing that would quite fit my business. It’s attractive for investors, which could prove a boon for start-ups seeking funding. But that’s not for everyone. Then there are the people overseas who we’ve practically begged to come share their ideas with us. They don’t want a bar of us either.
In 2016 Australia is a toxic cesspool for creativity, innovation and growth. Businesses are given no encouragement to establish themselves here, with state and federal governments demanding far too much protection money for the privilege of contributing to the economy. If you want to set up shop, you’re going to be hit with stamp duty and land tax. If you want to employ people, you’re going to be hit with payroll tax just for the pleasure of paying them a salary that gets heavily taxed on their end as well. Even if you’re lucky enough to receive a break of any kind, the masses will turn against you because they don’t understand how company tax works and would rather reward bad behaviour than support new enterprise. If that isn’t enough to deter a budding entrepreneur, just look at the state of the place. Why would anyone want to subject their lives to extreme micro-management at the hands of moral overlords in a totalitarian state? What’s more concerning is It’s not just the new guys that are frustrated either.
The issue should have been urgently addressed when Atlassian jumped ship. When Australia’s biggest start up success story bailed to the UK before their IPO, it should have prompted panic. This was one situation that perhaps even called for one of our government’s infamous knee jerk reactions. As per Tech World –
“The biggest thing the Atlassian news has done is highlighted to a lot of startups and technology entrepreneurs that when they get to a serious level that Australia isn’t the place for them to call their home,” said Jonathan Barouch, CEO of Sydney-based startup LocalMeasure. While Atlassian is not moving jobs from Australia, registering as a UK company “signals that we have issues with our local legislation,” said Barouch.”
Attorney Nick Abrahams said the Australian government only had themselves to blame. “The taxing of employee options makes Australia an international joke,” said Abrahams, referring to changes to the share options rules made under Labor three years ago, which discouraged Australian startups from providing the options to employees, a key non-cash incentive.
Mick Liubinskas, an invaluable asset to Australia’s start-up scene recently decided to make the move to Silicon Valley. Predictably, Liubinskas was more diplomatic than others. As per his announcement on muru-d –
“After 18 years of loving my life growing technology companies in Sydney, I’ve decided to make the move to the USA. It’s a big step and I do it with excitement, fear, disappointment and hope.”
“To meet people. Networks are about relationships with people and they are built face to face. It’s about understanding each other, showing commitment, following through and also about continuity. With all the technology in the world, consistently being there is one of the foundations of strong networks. I can’t do what I need to do from Australia with the occasional visit.”
“We have a Prime Minister who can talk with knowledge and interest about technology and innovation. I hope we have the courage, and enough volunteers, to put experienced entrepreneurs at the head of these programs or else I don’t believe they will work.”
“Apart from government impact, the efforts need to be city based and that is starting to occur. Melbourne, Perth and Brisbane seem to have solid, entrepreneurial led groups driving it forward which is great and Sydney will hopefully follow suit soon with TechSydney.”
If the fact Perth and Brisbane are considered ahead of Sydney doesn’t alarm you, I don’t know what will.
Pete Cooper of the Start Society was a little more direct with his thoughts, as per Business Insider –
“We are volunteer advocates and educators. We are not rent seeking but we would like cheap unused govt buildings or bond guarantees (our building is getting redeveloped in early 2016 and I have to personally guarantee a six-figure bond for the next lease before the old place and old bond is returned), or help subsidising salaries (we are volunteer run) for education officers to scheduled and administer the lectures plus community managers to connect people. (We have real tech start-ups so they want to talk tech, not what some 60 year-old Aus Industry case worker wants to talk about from the 90s).”
iCentral is based in a former Centrelink office near Town Hall in Sydney and Cooper has a sense of irony about the transition between the uses of the building.
“Three of our teams (all at iCentral and all members of The Start Society) have hired a total of eight new interns and grads just this morning, but we are getting zero support from the innovation statement,” Cooper said. “Most are introduced by a program I set up in my spare time. Our office space used to be government funded desks for public servants giving away tax money (Centrelink) now it is full of self-employed tech start up entrepreneurs who are hiring more staff. And we don’t get one cent of government support. So f**ked.
“Don’t even get me started on the scale of this Innovation Statement. It should be 10 times larger, and faster and simpler to get world recognition for Australia. A $1 billion announcement (of which much was already pre-committed like wifi revenues from Aussie inventions) meanwhile a new $1 billion company is being created every four days in the USA and we should have $150 billion of our $2 trillion in superannuation into start-ups. We should be adding a zero or two and building the tech start up hub for Asia with 50 new incubators and a start-up stock exchange.
Looking at is from another angle, 40 year CSIRO veteran, Dr John Church summed up the global perspective when interviewed on PM –
“Our reputation is now trashed internationally.”
Unless you have been living under a rock, or in a slightly rural area without the internet, you’d be familiar with Freelancer CEO Matt Barrie’s thoughts on the matter. Barrie spoke in no uncertain terms when addressing the departures of Luibinskas as well as Hamish Hawthorne, Chief Executive of ITP Innovations (a tech business incubator named best in the world not two years ago)
“They’re both gone. Mike Baird, it’s not just the young people fleeing Sydney.
And you’re kidding yourself if you think they are going to come back one day. In the last fifteen years that I have been running technology companies in Australia, out of the scores that have left I’d estimate that less than 10 percent come back.”
But out of all the industry heavyweights and commentators offering their opinion, the most chilling statement of all comes from a top Silicon Valley recruiter approached by Barrie not long ago. Despite a six figure carrot, the recruiter was straight to the point –
“I’m really sorry but we won’t even look at taking a placement for Australia.”
On the bright side, the latest federal budget has been fairly well received. Cautious optimism seems to be the general consensus. There will always be an air of optimism if Malcolm Turnbull is Prime Minister too. But politicians have a long history of incompetence and besides, there are still a tonne of things that need to happen before Sydney and Australia are considered a viable possibility, let alone an attractive option.
But that’s enough doom and gloom for now. Let’s focus on some positives. Mike Baird has declared he wants to make New South Wales “the Start Up State”. And let’s not forget the advice of perpetual positivity machine – Gary Vaynerchuk –
WRONG. So very, very wrong. I’m afraid we’re not done with the doom and gloom yet, either. Not since Mike Baird made his infamous Facebook rant where he admonished his followers (using evidence that was at best misleading, at worst made up) before declaring “long live Sydney” have we seen such a deluded statement. In fairness though, his statement that he will make New South Wales the “Start Up State” is about as accurate as his claim that Sydney is “now safer and more vibrant than ever”.
Many eyebrows were raised earlier in the year when it was announced Mike Baird was heading on a junket to Israel. Co-ordinated by the Australia-Israel Chamber of Commerce and NSW Jewish Board of Deputies, a group of delegates were to head to Tel Aviv as part of a week-long trade mission. Baird decided to call himself in and tag along with his wife Kerryn, Police Commissioner Andrew Scipione, Chief of Staff Bay Waburton, Communications Director Imre Salusinszky. NSW Chief Scientist & Engineer Mary O’Kane and medical cannabis advocate Lucy Haslam. Oh, and of course the man with possibly the most dubious resume in the industry, social media advisor Tony Story.
Personally, I was a bit shocked with the scheduling. Reports were advising the party was apparently due to depart for the Holy Land on April 2nd – the day after Baird’s 48th birthday. In my experience, having a plane to catch the day after your birthday never ends well. But thankfully for Baird, and Baird alone, 1.30am lockout laws ensured there would be no risk of any late night shenanigans. Sunday night news reports confirmed the crew had arrived safe, sound and on time. No doubt everyone made sure they were all tucked in by Baird time the night before leaving. But I digress.
“Israel is known as ‘start up nation’ for good reason, and, as we prepare to launch our own Innovation Strategy later this year, there can be no better time to study the successful Israeli model for nurturing new ideas and encouraging innovation and entrepreneurship,”
“We also want to create practical connections and synergies between Australian companies and researchers working in areas ripe for innovation and their Israeli counterparts.”
I’m curious to see what the benefit of this trip will prove to be. Please note, I won’t be commenting on Baird visiting religious sites and whatnot. I strongly believe what the premier gets up to during his own free time is nobody’s business but his. The purpose of the trip was to do a bit of fact finding and establish relationships in regards to innovation and cutting edge medical technology. Which made the inclusion of Scipione a head scratching one. Innovation and progressive thinking are two things one would not usually associate with our states evangelical, tee-totalling police commissioner. Admittedly, there were talks regarding cyber security on the agenda, but cybercrime falls under Australian Federal Police jurisdiction so on the surface it was a bit of mystery to see Scipione on the list of delegates.
“I want to make NSW the ‘start up state’, and this week we have helped this goal by engaging and establishing formal partnerships between our businesses, universities, researchers, and their counterparts in Israel,”
“Israel is one of the world’s most innovative economies, and by creating a new corridor between Israel and ourselves — on issues such as cyber security, financial and medical technologies, and innovation — we can increase NSW’s competitiveness in the future digital economy.”
It’s been a month since the bunch returned from Israel, and while it would be unfair to expect tangible results this soon, it would be nice to see some kind of action plan. A couple of partnerships have been formed but we’re yet to hear what’s in store for the future of the Start Up State. Judging by the response Baird received at the United in Compassion Medical Cannabis Symposium over the weekend, it would appear there had also been little progress on that front.
Despite such a bold mission statement, all Baird has to show for his trip is a handful of ambiguous partnerships, a new flight simulator to be housed in Dubbo and an unforgettable culinary experience where he treated himself to a kebab. This trip was starting to look less like a trade mission and more like Jack and the Beanstalk.
The agreement made between Australia’s Garvan Institute of Medical Research and Israel’s Weizmann Institute shows the most promise, with the two organisations pledging collaboration with cellular genomics research. There was also a memorandum of understanding between the University of Sydney and the Agricultural Research Organisation of Israel which as per Jewish News – “is intended to help dairy, poultry and aquaculture in NSW, chiefly by drawing on Israeli expertise through teaching, training and research activities.”
“A bridge between these two innovative and world leading research bodies”.
“It makes sense to share knowledge, expertise and innovative research”
Baird’s plan for the “Start Up State” did not seem as clear cut. From news reports it appeared the only real plan of action was to use the terms “innovation”, “innovative” and “innovator” as frequently as possible and have journalists follow suit. It seemed to be working. One reporter seemed particularly confused as she reported “$7.5 million had been spent on Israeli innovation”. She then knowingly observed “Israel’s success as the start-up nation does not necessarily mean entrepreneurs here have the best ideas, they just know how to follow them through” before pondering “the challenges we face as the Baird government tries to bring some of these models back home” as she gestured towards an old building off screen.
But in the same way that saying “we’re having an ideas boom” does not necessarily guarantee there is an ideas boom – saying a variation of the word innovate multiple times does not actually mean anything particularly innovative is happening. Knowing the Australian mainstream media’s penchant for buzzwords and repeating phrases they don’t fully understand ad nauseam, I turned to the Israeli media for further clarity.
According to the Israel Ministry of Foreign Affairs, New South Wales and Israel signed a “Technological Cooperation Pact”. The MFA website states this is a joint industrial research and development agreement to “establish a mechanism of cooperation with parallel funding for companies from both countries conducting joint research and development projects.”
“Today’s agreement is just the beginning of deepening cooperation between companies in Israel and New South Wales and will undoubtedly prove its value to both sides, leading to new levels of innovation. We are proud to share our best practices as the Start-up Nation and look forward to promoting our successes in innovation and entrepreneurship with the delegation from New South Wales. We are excited to be adding New South Wales to the growing list of states and countries which cooperate with Israel on technology and R&D.”
It’s all sounding very warm and fuzzy, with ample use of the term “innovation” for good measure. Although I was struggling to figure out how any of this would really benefit start-ups or the state of New South Wales. None of this really seemed to address the issues discussed earlier. The foreign affairs release went on to state –
“Under the agreement, Israeli companies will team up with companies from New South Wales (NSW) to co-develop and commercialize innovative products. The companies will receive financial support from both governments. In Israel, support will be granted by the Israel Innovation Authority and in New South Wales participants will be supported by the Department of Industry of NSW through the Office of the Chief Scientist & Engineer. Support will be available to all industry fields, but with a particular emphasis on cyber-security, water management and agricultural technology.”
While there are many successful water management and agricultural technology start-ups, those industries are not exactly the first thing that comes to mind when you think about the term “start up”. There are also a great number of cyber security businesses in an industry that evolves at a rapid rate. But I’m not sure everyone is on the same page here. When I think of cyber security I think of protection from viruses from browsing totally legitimate parts of the internet and protection from hackers. Of course, it’s obviously far more intricate than that, but we’re using layman’s terms here. Mike Baird and Andrew Scipione would definitely classify as laymen.
It was claimed that this agreement could open up great opportunities for start-ups in global and especially Asian markets. But given the geopolitical climate in Asia and the relationship between China and our historical allies, the USA, I don’t see this as being hugely viable for local start-ups and entrepreneurs. Even if it were, a state premier and police commissioner would not be the ones doing all the deals. Given Baird’s constant terrorism rhetoric, and the presence of Scipione in Israel, I suspect a slightly different interpretation was being discussed here
While Baird was off visiting medicinal cannabis research facilities and searching for the best kebab in Bethlehem, Scipione kept himself amused by hanging out with his Israeli counterparts. The top cop looked suitably impressed as he immersed himself in some of training abilities of one of the most high tech and on edge police forces in the world. Personally, I’m not sure “on edge” is a trait our police force should be trying to emulate.
Media reports noted Scipione was there to learn from the best and stay on top of cybercrime. But as mentioned earlier, cybercrime is the domain of the AFP. At state level, the only cybercrime police concern themselves with is low level fraud such as fake identification and mail theft. The police commissioner’s insight into the topic was somewhat limited, which isn’t to criticise as it isn’t in his job description. Although he did attempt to offer chilling commentary on cybercrime, remarking “I often say the sky is the limit. If someone took control of an aircraft and you’re on that aircraft the potential could be for a terrible outcome”. Indeed. Fortunately, an interview published on the Jewish News website gave a hint as to what was actually being investigated.
“…The force has much to learn from Israel…. We will be looking to formalise ties in this area and looking at some exchanges.” Scipione said Israeli innovation against cybercrime is characterised by staying a step ahead of cybercriminals, with sharp assessment of the direction they will take and swift solutions to fight them. “It’s the sort of approach that I think is going to be so important in the future,”
Staying one step ahead is the ultimate dream of any police official who has watched the movie Minority Report too many times. However it’s generally an objective that proves quite difficult to achieve using traditional policing methods. The methods required to stay truly ahead of the game are far from traditional and almost exclusively involve indiscriminate violation of privacy. “The way you deal with crime in Israel may be different to how we deal with it in Australia, but one thing that is the same is how we deal with crime on the World Wide Web” Scipione declared, before adding one last, perhaps Freudian, remark – “Your Facebook is my Facebook.”
Along with having a reputation as being the “Start Up Nation” and a world leader in innovation, Israel is also renowned for espionage and intelligence. Scipione went as far as to say he saw Israel as being a “cyber super power”. The Israeli intelligence agency, Mossad, who has been made famous worldwide by spy thrillers and TV shows, claims to be responsible for “intelligence collection, covert operations and counter-terrorism” as well as “protecting Jewish communities”, something that no doubt gets Baird and Scipione a bit hot under the collar. Given the raft of intrusive and draconian legislation this pair have overseen, it comes as no surprise they would be turning to the best in the world to up their #nannystate game.
The flight simulator mentioned earlier that would be making its way to Dubbo is a product of Elbit Systems. While Elbit are primarily defence focussed, according to reports the technology they are providing NSW will be repurposed from defence to medicine. Nobody can argue that Elbit Systems is not an innovator. As per the Elbit website –
Elbit Systems Ltd. is an international high technology company engaged in a wide range of defense, homeland security and commercial programs throughout the world. The Company, which includes Elbit Systems and its subsidiaries, operates in the areas of aerospace, land and naval systems, command, control, communications, computers, intelligence surveillance and reconnaissance (“C4ISR”), unmanned aircraft systems, advanced electro-optics, electro-optic space systems, EW suites, signal intelligence systems, data links and communications systems, radios and cyber-based systems. The Company also focuses on the upgrading of existing platforms, developing new technologies for defense, homeland security and commercial applications and providing a range of support services, including training and simulation systems.
Browsing through the products and services offered by Elbit and checking out their company brochures, I was reminded of the gadgetry seen in action movies and futuristic video games. To be honest, some of the tech look pretty damn cool and definitely belonged in a video game. A video game that I really wanted to play! However my kid in a candy store moment quickly dissipated when I remembered the video games I was reminiscing about were usually set in a dystopian future where the protagonist is up against a totalitarian regime and everyone is living an Orwellian nightmare.
Elbit generally specialises in military and defence and supply resources to a number of countries around the world. Elbit even has an Australian arm – Elbit Systems of Australia. The presentation linked describes the subsidiary as “a tier one Australian Defence company leading the digitisation of the ADF” and they’ve been kitting out our diggers with armoured vehicle systems, artillery and more since 1993. However their relationship with the ADF seems to be the extent of their operations down under, leaving Elbit Systems Ltd in Israel, along with other subsidiaries, responsible for everything else.
Unsurprisingly, one of the areas Elbit and their subsidiary Cyberbit specialises in is cyber security, as well as signal intelligence (SIGINT). One of their most advanced platforms is their Wise Intelligence Technology (WIT) system. WIT is an intelligence and investigation platform designed for law enforcement agencies, as well as national security and intelligence agencies. It claims to utilise a range of innovative concepts that form a comprehensive, end to end intelligence and investigation infrastructure. As per Elbit marketing material –
WiT™ (Wise Intelligence Technology) WiTTM is Elbit’s intelligence and Investigation platform designed for law enforcement, national security and intelligence agencies. Fully operational and field-proven, WiT™ incorporates a range of innovative and established design concepts that combine to form a comprehensive, end-to-end intelligence and investigation infrastructure. WiT™ provides a flexible and customizable infrastructure, integrated with advanced, cutting edge tools for supporting every stage of the intelligence and investigation cycle – from planning and direction, to collection, processing, analysis and dissemination. Optimized for high performance and capable of collecting, processing and storing enormous amounts of data, the platform utilizes the most advanced technologies to effectively extract the relevant information from multiple structured and unstructured data sources.
On April 4 this year, a day after the Baird led trade mission had commenced, Elbit made the following announcement –
“Elbit Systems Ltd. (NASDAQ and TASE: ESLT) (“Elbit Systems”), announced today that its subsidiary, CYBERBIT Ltd. “CYBERBIT”), was awarded contracts to supply intelligence and cyber analysis and research systems for a country in Asia-Pacific for an aggregate amount of approximately $22 million. The systems will be supplied over a two- year period.
The systems to be supplied consist of CYBERBIT’s WiT™ system, a highly advanced end-to-end intelligence and investigation solution, that supports every stage of the intelligence process, including the collection of the data from multiple sources, databases and sensors, processing of the information, supporting research, analysis and evaluation of the information with advanced analysis tools and disseminating the intelligence to the intended recipient.
Adi Dar, General Manager of CYBERBIT said: “We are proud to be selected to supply these advanced operational systems, which provide our customers with a significant leap forward in their intelligence analysis and collection capabilities. CYBERBIT is a world leader in the fields of SIGINT (Signal Intelligence) and cyber defense, with cutting edge solutions highly suitable for governmental agencies, large commercial organizations and critical infrastructure sites.”
Given the nature of their business, Elbit does not reveal who their clients are. The reality is they could be referring to almost any country in the Asia-Pacific region. For example, Israel considers China a strong trading partner. However, their trade relationship generally revolves around robotics manufacturing, construction, irrigation and water management. Also, ne wouldn’t imagine China outsourcing military or intelligence requirements. It’s also worth noting that previous press releases from Elbit have distinguished between Asia and Asia Pacific, possibly suggesting a buyer away from the mainland.
There is a strong possibility we’re the buyer, and I say this without a slither of tin foil in sight. If I were a betting man, and I am, I would take short odds. Considering the timing of the announcement, the 20 year association between the ADF and Elbit’s local subsidiary, the attendance of the NSW police commissioner, the comments made by Baird and Scipione in regards to this trip and frankly, their conduct over the past two years when it comes to legislation and policing I’d be tempted to say it’s a sure thing. Scipione even carries the nickname “The Electrician” – a reference to his proclivity for surveillance. Elbit is also highly innovative! However I’m not overly confident of finding out any time soon. Previous Freedom of Information requests related to Elbit have predictably hit brick walls.
It seems the next like the next logical step for the New South Wales hierarchy. I must admit a system like this makes a nice addition to Public Safety Order and Serious Crime Prevention Orders, anti-protest laws and of course the lockouts and other measures associated with the Liquor Act. All lovely things that encourage creativity and innovation. It’s hard to argue that “Start Up State” is not one of the first phrases that comes to mind when you reflect on the state of our state. That is of course, if by “start-up” you actually mean something like “surveillance”, “spied on”, “police” or simply “nanny”.
So welcome, ladies and gentlemen, and try not to be overcome with excitement (any unexpected outbursts or incidents of yelling, singing or laughing will be dealt with accordingly). It’s all happening in the state of New South Wales, and if you don’t believe that we’ve got the evidence to prove it. We saw you smiling last night for a brief second when you were at home alone last night. Don’t try to say you were watching your favourite TV show, we know you were silently reflecting on how great Sydney has become. Nothing gets by us! On that note, if by the time you read this I’ve mysteriously disappeared, all I ask is they play The Doors at the funeral and 90’s dance at the wake.
The ideas boom is booming and the Start-Up State is more vibrant than ever! You want proof? A variation of the word “innovate” appears 37 times in this article, and countless more all over the world wide web. You could even say it’s trending! And that, my friends, more compelling evidence than any actual innovation could ever provide.
“Long Live Sydney”