From Australia to Silicon Valley: 6 lessons in the pathway to deep tech venture capital

June 27, 2022

Building a deep tech innovation ecosystem is challenging — so what might we be able to learn from our neighbours over in Silicon Valley? Luckily the answer is plenty.

Image: Jun Qu, Senior Investment Associate at Main Sequence

To solve this century’s global challenges — and the next — founders, policymakers, industry leaders and
investors must collaborate in order to successfully commercialise research and bring these new
technologies to the world. Senior Investment Associate at Main Sequence, Jun Qu, shares six lessons he’s learnt about building a deep tech innovation ecosystem.

The Silicon Valley Zeitgeist

After spending five years in the Bay Area— first at Stanford University and later with McKinsey’s internal tech incubator and investing group, Launch — there is something to be said about the way ideas are nurtured in and around Silicon Valley.

Although a vast majority of these lessons come from SaaS and consumer tech, the tried and true favourites for venture investors, the fundamentals behind what makes a venture investible or scalable are the same.

For the scientific and engineering solutions needed to fix the planet’s biggest challenges, these elements are arguably even more important, and the stakes have never been higher, so where better to unearth these solutions than Australia, a world leader in deep technology research.

For Aussie deep tech researchers and founders who are taking the leap, here are six lessons we can take
from our American counterparts:

  1. Tell the story
    The most compelling founders are the best storytellers. Irrespective of the complexity of the idea,
    the concise and confident communication of an idea is important. Break it down so everyone from
    everyday consumers to world-leading researchers can understand the impact, and don’t get stuck in the weeds.
  2. Focus on the problem
    In VC, it is common to see numerous ‘solutions’ in search of a problem — aka ‘if you build it, people
    will buy it’. As a former engineer, it took a shift in my own mentality to understand how investors
    and customers think. Maintain focus on the big problem you are solving, and the impact will follow.
  3. Perfect is a luxury
    A mentor once told me “to never let best get in the way of better”. Engineers like to get things
    perfect and bug-free, but the objective for new ventures is to achieve good enough. Up against
    limited capital and time, over-engineering something is a luxury. Start with the minimum viable
    product and consider what is truly necessary to prove your proposition.
  4. Celebrate wins… and losses
    Tall Poppy Syndrome is common in Australia, threatening our entrepreneurial spirit and leaving our
    most ambitious ideas on the table. It hurts us whether we win or lose, and is a key cultural aspect
    that needs to change. We must be proud of the hard lessons, celebrate the wins and swing for the
    fences more often.
  5. Make collaboration habitual
    Business is rarely a zero-sum game and we can unlock more opportunities through collaboration.
    From building new products by combining products to co-investing in shared infrastructure and
    educating across industries, collaboration is essential to growing the deep tech ecosystem. Be
    curious, explore the possibilities, and say yes more often.
  6. Ask for help
    Engineers hate having to ask for help. But, unless we are on the bleeding edge, it’s highly likely
    someone else has done this before. It is more efficient to seek help than start from scratch and it
    means things get rapidly done. It’s okay to not know, but avoid spending precious time and energy
    reinventing the wheel on something that has been done before.

The global opportunity for Australia

From CSIRO’s invention of WiFi to pioneering the Cochlear implant, Australia is responsible for some of the world’s most significant scientific breakthroughs.

More recently, the runaway success of SaaS and fintech darlings including Atlassian, Canva and Afterpay
has returned Australia to the stage as a global leader in innovation. However, the effective translation of
research is where we have an opportunity to really shine.

We’re already seeing the emergence of purpose-driven founders tapping into Australia’s science capability to translate impactful research for planetary gain.

Take Dr Stefan Hrabar and Dr Farid Kendoul as one example. Formerly researchers within the Robotics and Autonomous Systems Group at CSIRO’s Data61, the duo saw the real-world potential of their research and decided to turn these ideas into a commercial enterprise. They have since founded Emesent which has grown to be recognised as a world leader in drone autonomy, LiDAR mapping, and data analytics.

Space startup Quasar Satellite Technologies and industrial AI innovator Presien share similar founding
stories and are leveraging research to deliver technologies that are drastically transforming their respective industries.

Australia’s world-class research capability means the opportunity to be a leader across industries like
hydrogen, space and quantum technologies is well within reach.

Main Sequence Managing Partner, Bill Bartee, often says, “We’ll do anything it takes — we’ll mop the floors if we need to,” and it’s this dedication to building future technologies which sets us in good stead.

While many countries are trying to create the next Silicon Valley, let’s instead lean into our history of
bringing domestic ingenuity to the global stage. Australia’s deep tech ecosystem is thriving, and we’re
confident investors and global leaders will increasingly look toward the southern hemisphere as a place that nurtures the scientific-backed industries that future generations will depend on.

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