One of the hardest parts of establishing a successful startup is getting the assistance and funding to get your ideas off the ground and adequately support its growth. Aside from going out-of-pocket or selling your idea to private investors, you may also be eligible to take advantage of grants, incentives or expert advice provided by the Australian government.
Australia's Entrepreneurs' Programme is the government's largest platform for existing small and medium businesses offering multiple solutions to enable increased competitiveness and growth rates. Through its many programmes, eligible businesses can gain access to a network of advisers and facilitators who can help businesses overcome the many challenges they face and make the most of available opportunities in both the local and international market.
Grants are available through the following programmes:
Accelerating Commercialisation Grant
Eligible Partner Entities (EPEs), commercialisation offices and other publicly funded research organisations that are looking to commercialise new products and services resulting from the assistance provided by Accelerating Commercialisation can apply for grants worth up to 50% of the required expenses for a particular project - with a maximum grant of up to $250,000. Other successful applicants who do not fall under the first three categories previously mentioned can also qualify for grants worth up to $1 million.
Business Growth Grant
Businesses that receive advisory services from the Entrepreneurs' Programme can also apply for a Business Growth Grant which covers up to 50% of the cost of hiring someone who can help implement planned projects. A maximum of $20,000 can be expected from this particular grant.
This programme aims to help establish new startup, incubators and accelerators, as well as expand existing ones, in various regions across Australia. Incubators can apply for matched grants which range from $10,000 to $500,000 per project, or from $1,000 to $10,000 for hiring expert consultants who can help address key challenges.
This programme helps businesses identify knowledge, research and technology gaps in their operations through free consultations with a facilitator. Once a new research project has been identified, participating businesses can apply for matched grants worth up to $50,000, which can be used to hire a researcher in-house, or have an existing research employee or post-graduate researcher collaborate on the project with a Publicly Funded Research Organisation (PFRO).
R&D Tax Incentive
Aside from grants and assistance, the government also offers tax incentives for research and development via the R&D Tax Incentive. In an effort to help Australian businesses stay competitive, any companies with an annual turnover under $20 million are eligible for a 43.5% refundable tax offset for any R&D expenditure in the amount of $100 million or less.
All other companies can still take advantage of the incentive, by claiming a 38.5% non-refundable tax offset. Unused non-refundable offset amounts can be carried forward across future income years, making this a very attractive incentive indeed.
It's worth noting that for R∓D expenditure under $20,000, companies will only be eligible to make a claim if it was undertaken with a co-operative research centre or research service provider.
Venture Capital Limited Partnerships (VCLP)
The VCLP programme has been setup to attract foreign Venture Capital investment and boost the Australian VC market via tax incentives. A number of steps must be undertaken for funds to be eligible, these include registering as a VCLP and making high risk investments that hold for a period of at least 12 months.
A number of conditions are set on the types of ventures that these funds can invest in. If approved, the VCLP funds will gain tax benefits including exemption from capital gains tax on their share of profits made by the partnership, flow-through taxation treatment and the ability to claim carried interest on the capital account instead of revenue.
The Commonwealth Scientific and Industrial Research Organisation (CSIRO) aims to help innovative new startups and small businesses by providing matched funding that can allow them to better access the agency's research expertise and capabilities. CSIRO Kick-Start vouchers range between $10,000 to $50,000 which can be used for researching the commercial potential of a new idea, or developing and testing a new product or service.
Austrade Landing Pads Programme
Startups with market-ready products and services can take advantage of a government-sponsored residency at an accelerator or Landing Pad based overseas to learn how to be more globally competitive. The short-term residency can last up to 90 days with Landing Pads that are located in some of the most innovative startup hubs in the world — San Francisco, Tel Aviv, Berlin, Shanghai and Singapore. A Landing Pad Manager is available to business development advice during the residency, and will also facilitate access to coaching, training and networking events. The startup is responsible for shouldering their chosen representative's airline tickets, accommodations, visa fees and insurance.
Export Market Development Grant
If your startup already has an export-ready product, you can get financial assistance to cover international marketing and promotional expenses courtesy of Austrade. Export Market Development Grants (EMDG) can also be used to pay for overseas intellectual property registration, international trade fair and seminar costs, and buyer visits to Australia. Businesses that qualify for the grant will be reimbursed for up to 50% of their incurred expenses, with a maximum of $150,000 per application. Up to eight grants can be awarded to an eligible business for every financial year.
Small Business Export Loan
Startups that need additional capital in order to fulfil pending export orders or contracts can get an unsecured government-backed Small Business Export Loan through the Export Finance and Insurance Corporation (EFIC). Export loans range between $20,000 to $50,000, and can be approved in nine business days. Interest rates are fixed throughout the term of the loan and there are no penalty fees for early repayment.
As you can see, the government offers a number grants, programmes and incentives to help Australian businesses innovate and flourish. Eligibility is depended on a number of factors, but putting the effort in to apply for a grant applicable to your startup might make a world of difference in the long run.