News and Research | AusGrant - Leading R&D Grant Writers - Part 6

Last week, Australia Post announced that it will be investing $20 million in emerging e-commerce business and will be co-locating its ‘venture accelerator program’ within the University of Melbourne’s Melbourne Accelerator programme (MAP). The company also revealed that it could invest as much as $100 million in the next few years in emerging local e-commerce businesses as a measure to fuel innovation in digital services for its customers.

The partnership with MAP and the investment fund are part of a wider program which is directed at accelerating e-commerce innovation and aiding small businesses across Australia. In relation to this, University of Melbourne vice-chancellor and professor Glyn Davis said, “harnessing the current mood around Australia’s innovation agenda is important, and this investment will go a long way to ensuring that start-up cultures like those at MAP continue to have a prominent role at the university.” This non-exclusive partnership is predicted to be the first of many around Australia.

In addition to this, Ahmed Fahour, Managing Director and Group CEO of Australia Post, believes innovation is at the forefront of Australia Post’s transformation into a leading e-commerce business.

Already Australia Post increased innovative activities – last week it was reported that Australia Post is conducting research and development in trialing the use of drones for package deliveries as early as next year. The drones, which will cost $10,000 each, will allow parcels to be delivered right on people’s patios.

Indeed, Australia Post’s investments in innovation will no doubt add a competitive edge in an increasingly technological market. There is no denying that innovation is one of the most exciting ways to move a country and a company forward. But for that to happen, a company must create an environment conducive to innovative activities. A way for companies to do this is by undertaking research and development to drive new ideas, products, processes or software. Whether you are trialing drone delivery or researching a new product, you may be eligible for tax credits. Contact us today to find out if you qualify for the R&D Tax Incentive.

The Lucky Country by Donald Horne, which came out in 1964, has gone on to become a cult classic, as well as trademarking Australia with a nickname. However, Professor Iann Chubb believes we need a change of titles, shifting from the infamous “lucky country” to being recognised as the “entrepreneurial country”.

Professor Chubb, who won the Lifetime Achievement Award, is a researcher, university leader, influential policymaker and a powerful advocate to government and the Australian public. This week, he has bought Australia’s entrepreneur problems to light in a report titled, Boosting High-Impact Entrepreneurship in Australia. In the report he notes that the entrepreneurship activities in most Australian universities are lacking in maturity by global standards. As a response, the report suggested that incentives linked to funding would encourage universities to recognise academic staff for engagement in student entrepreneurship activities.

In addition, the report reveals that few universities have frameworks to support entrepreneurial students in place in Australia, whilst it is a very popular model overseas. In Australia, if staff are engaged with student entrepreneurship, it is generally unfunded and considered ‘labour of love’. However, in the United Kingdom, universities are assessed on not only the quality of their research, but also the impact this has on students and the economy.  The report suggests applying a mix of programs in universities. It says entrepreneurs with track records should be recruited as role models and guest lecturers. Classroom-based learning should be supported with experiential programs such as incubators, accelerators, internships and overseas placements.

As  can be seen from the above, Chubb believes that entrepreneurism needs to be taught at all levels of educations –  in schools, universities, and throughout an individual’s working life. In the report’s foreword he writes that entrepreneurship, “is inseparable from education — not independent of it…we need to shift our mindsets from a willingness to muddle along to a determination to make our luck.” What do you think, can entrepreneurism be taught and will this change Australia’s reputation to being more innovative?

The Turnbull government hasn’t been silent about their desire to shift Australia to be more innovative, mainly by endorsing start-ups and creating a tech community. Wyatt Roy, Assistant Minister for Innovation, noted earlier this month how Israel transformed itself into a digital economy with more start-ups per capita than any other country. Indeed, the government hopes to do the same with Australia with the aim to position ourselves as a strong competitor in the global economy.

But why start-ups and why are they good for our economy? We’ve gone through five key positive effects that start-ups can have on the Australian market below.

1) The Future of Business

There is denying our economy is shifting to being more technologically-driven. As we mentioned in yesterday’s article, the Internet of Things (IoT), is completely changing the way we interact with each other. Moreover, in the famous words of Google, “start-ups fuel economic growth and increase innovation”. Indeed, start-ups could help Australia adapt to a digital change.

2) Supporting Local Economies

Start-ups, or those who start them, are locals and they generally hire local freelancers. They often become involved in communities and partake in industry events, as community engagement is vital for the success of their business. Thus, these combined efforts supply money, resources and vibrancy back into the local community.

3) A varied market

The fruit of startups are born out ideas that are inspired by gaps in the market. Moreover, due to the increased competition between small businesses, start-ups are required to develop their products, faster, more efficiently, and cheaper. As a result, consumers are presented with reasonably priced, quick solutions to common problems.

4) Developing Well-Rounded Individuals

Working for a start-up means having to learn to do a number of different tasks that are necessary for the development of a successful business. In essence, the scope of a start-up employee’s work is far greater than an employee working in a single department for a large company, and thus, they often gain a more varied work experience. From marketing to accounting, start-up employees often wear many hats.

5) Providing Opportunities in Tough Job Market

Start-ups often employ young individuals in a range of industries or offer an in-depth experience for interns. In an unresponsive job market, start-ups can definitely assist in job creation.

Overall, start-ups can have a huge impact on the economy and can help create a more vibrant market in Australia. If you are start-up in Australia and conducting research and development, you may eligible for Research and Development Tax Credits – contact one of our specialists today to find out if you qualify.

This week throughout Sydney, 150 speakers and 60 events across 22 venues will take place to showcase and endorse Australian start-ups. There are ten different streams, majority around technology, including financial technology, health technology, and to the delight of many, the Internet of Things.

If you hadn’t heard of the ‘Internet of Things’, or IoT for short, it is basically a concept of connecting any device with an on and off switch to the Internet. From wearable technology to smart cars and homes, the IoT is a giant network of connected “things”. It is the relationship between people to people, people to things, and things to things.

Although Australia did not partake in the PC wave during the 80’s and 90’s, initiatives such as Start-Up Week and the Turnbull governments innovation agenda, Australia has the opportunity to embrace and impact the IoT wave. Moreover, The IoT movement is rumoured to be larger than the smartphone, tablet, and PC markets combined.

In relation to this, large corporations in Australia have started realising the potential of IoT and are acting on it. However, in order to develop and improve new products, devices, processes and ways to connect to ‘things’, a company should consider investing in research and development to drive innovation.  In fact, several companies may already be partaking in R&D activities and may not know that the Australian government seeks to support them by encouraging innovation through the Research and Development Tax Incentive. Contact Ausgrant today to see how the R&D Tax Incentive can help you.

It’s battle of the plastics, as Australia’s NSW government reveals plans to create a ‘Silicon Harbour’ innovation centre on Sydney’s infamous harbour. A desolate power station in the Sydney’s inner-west will be transformed into a technological hub, joining multinational tech firms with the startup community.

Premier Mike Baird has been put in change of the transformation and has large aspirations for the space. “This plan showcases the NSW government’s ambition for The Bays Precinct to drive an internationally competitive economy by creating destinations on Sydney Harbour that will generate space for hi-tech jobs and sustainable homes of the future,” Mr Baird said. “The plan will unlock The Bays Precinct’s enormous ­potential.”

In addition, Planning Minister Rob Stokes reveals a five kilometre long promenade, which will link each different site, and will allow the public to utilise areas that have been untouched for decades. Also embodied in the plan is a waterfront fresh-food market and an outdoor plaza with dining, entertaining areas and pop-up events.

Certainly, the elaborate plans predicted so far do sound like a step in the right direction for Australia’s innovation agenda. However, is creating a technology hub enough? As mentioned in a previous post, a recent NAB Innovation Report Summary revealed just 13% of all firms rate Australia as “highly innovative”.

Correspondingly, one way of further building an innovation society is highlighting the importance of research and development (R&D). Through the R&D Tax Incentive, thousands of Australian companies are given further incentives to innovate. Last year alone, the R&D Tax Incentive provided 13,000 companies with tax support. Companies who are including the R&D Tax Incentive in their tax strategy are reducing their taxes, freeing up their capital, and increasing their competitive edge in an competitive economy. Contact us today to see if you are eligible to claim the R&D Tax Relief.

On the 15th of October 2015, The ATO has alerted taxpayers against accessing the R&D tax incentive for ineligible broadacre farming activities.

According to TA 2015/3, the ATO and AusIndustry are revising provisions where chief producers engaged in broadacre farming are claiming the R&D Tax Incentive for the cost of fertilisers and soil improvers where a significant part (or all) of the expenditure that is acquired relates to “business as usual” farming activities and not to R&D activities.

Hence, The ATO and AusIndustry have communicated to individuals who may have entered into this type of arrangement. Furthermore, as a result of these findings, they will monitor registrations for undertakings that are analogous to those described in TA 2015/3 and will conduct compliance activities where needed.

In Australia, broadacre is land suitable for farms practicing large-scale crop operations. The key crop segments in this category are as follows, canola seeds, sunflowers seeds, wheat, barley, oats, triticale, sorghum, maize, and millets. Therefore, if you think you may be involved in these activities and  want to know how it will affect your claims under the R&D tax incentive, contact us today for more information. 

One of the most consistent findings in macroeconomics is that innovation drives economic growth.  The fundamental role that innovation plays in compelling economic growth is renowned due to the infamous work of Robert Solow (Nobel Prize Laureate in Economics in 1987). In his seminal 1957 paper, Technical Change and the Aggregate Production Function, one of the core findings of his work (and of its subsequent developments) is that a huge portion of economic growth is driven by technological advance. Indeed, in the 21st Century the economy is becoming more digitally focused and technology is reshaping established fields of medicine, manufacturing, energy and business services.

Recently in the news, the Australian government has voiced a desire to shift the Australian culture to be more entrepreneurial in our increasingly technological economy. One key agenda that has been focused on is the funding of start-ups and crowdfunding to boost innovation. However, is this solely where the government should be concentrating its efforts?

In particular, one topic that should be considered is boosting innovation in established businesses. Cochlear, the $4.8 billion world leader in hearing implants, is a prime example of an Australian innovation that has successfully transitioned to a global advanced manufacturing success story and resulted in long-term economic growth. Recently, Rio Tinto has been harnessing innovation through implementing driver-less mining trucks. Posing the question, how can Australia continue to produce new similar success stories whilst ensuring that companies like Cochlear continue to be Australian based?

For instance, one way to upsurge innovation with established businesses would be for the government to increase incentives in R&D. Rick Holliday-Smith,  Cochlear chairman, states his opinion that, “”we would recommend the government to reward appropriately defined innovative companies for their incremental R&D spend by increasing the concession for additional R&D expenditure.” Certainly, introducing further incentives and lifting the cap on research and development concessions would most likely encourage companies to continue to keep their innovative activities in Australia.

Nevertheless, it is imperative that Australia acknowledges the importance of R&D on a country’s competitive edge and long-term growth. Cross-country evaluations show that growths in private, public and foreign R&D all contribute to increases in multi-factor productivity. Furthermore, previous empirical research confirms that R&D does increase long-term growth (OECD, 2001). Thus,  for leaders, companies, and Australia as a entity, to remain competitive in a rapidly intensifying digital market, they should invest in research and development to drive innovation.

If you have invested in R&D within your company, you can still receive generous incentives from the government. Have a chat with us today to find out if your eligible.

References:

OECD (2001), The New Economy: Beyond the Hype – The OECD Growth Project.

In the wise words of Ellen DeGeneres, “when you take risks you learn that there will be times when you succeed and there will be times when you fail, and both are equally important.” In Australia, one of the biggest barriers to research is the stigma of failure. However, Australia needs a shift of mind and to embrace failure. This is particularly relevant for start-up entrepreneurs, who are confronted with the frank reality that new businesses are particularly delicate and can fail overnight.

Success disguises our mistakes, whereas failure gives us the chance to reflect and improve next time. Starting with the media, projects that failed should be discussed so that we can learn from them, instead of focusing exclusively on what worked. Moreover, Australia should take notes from our American counterparts, who have created ventures to push failure as a badge of honour. FailCon is one of these endeavours, promoted as a one-day conference for entrepreneurs, investors, developers, researchers and designers, it blatantly celebrates failure and encourages attendees to exchange stories of failure.

Early this month, Wyatt Roy, the Assistant Minister for Innovation, cited that changing the culture in Australia was vital to encourage a positive attitude to entrepreneurialism. “Changing culture is the biggest challenge we face,” he said. “It is probably the most important thing and it is the hardest thing for us to do.” He further added, ““We want to see a big cultural shift which embraces the entrepreneurial spirit in our collective psyche. We need to see greater co-operation between government, research, science and the private sector. We need to grow our talent pool and attract the best and brightest from around the globe.”

Could embracing failure be a step towards changing the culture in Australia to be more entrepreneurial? Indeed, whether we fail or succeed, being willing to take risks and ‘have a go’ is vital in Australia if we want to shift our culture to being more innovative. As we have mentioned previously, investing in research and development is a way to increase innovation. Although there are risks involved and failure is a possibility, R&D projects can generate valuable IP that can still assist in bringing innovation to the market. Have a chat with us today if you been involved in a R&D project and would like to see if you are eligible for the R&D tax credits.

With Australia having a clear agenda to boost innovation, are children the answer to shifting our culture?

According to Dr David Cropley, the University of South Australia associate professor in engineering innovation,  children should be educated in developing a more creative mindset to help  them secure future job opportunities in our progressively innovative economy. Dr Cropley elaborates by stating, “Part of the innovative mindset starts right back in schools. We’ve got to be educating kids to have a more creative and innovative mindset, to be open to new ideas and open to experiences — that begins at school.”

Already incentives have been taking place to implement children and shift our culture towards being more digital savvy and enterprising. Last week, Queensland made coding and robotics compulsory in schools from prep to Year 10 in a move towards embracing a more technical economy. Additionally, over the weekend, Wyatt Roy’s inaugural Policy Hack took place, where ten innovation ideas centering on culture, capital, co-operation and talent were pitched by teams of founders, investors, CEOs and members of the public sector.

The winning team was led by Erin Watson-Lynn who wanted to start a national Lemonade Day to produce innovative children. Her plan was to roll-out the day in schools across the country as a program open to primary school-aged children. The children would be involved in creating a business strategy, designing a marketing plan, and executing a business. Perhaps there would even be a research and development stage? Lemon to sugar ratio is a serious product development query.

Other key policy ideas for improving the country’s innovation raised at Policy Hack varied from instigating capital gains tax exemptions for start-up investors to setting up special ‘landing pads’ for Australian innovators heading overseas to hot-spots, such as San Francisco and Beijing.

Are children the future to our innovative society? Only time will tell, nonetheless, in the meantime there are steps companies can take to increase innovation in Australia. Research and Development can drive innovation for a company and result in new products and new processes for the environment. The Australian government encourages businesses to do this by allowing business owners to offset research and development with R&D Tax Credits. If you think you could be claiming cash back for research and development projects you’ve participated in, Have a chat with us today to see if you’re eligible.

“Innovation” has become a bit of a buzz word in Australia, with the Turnbull government focusing on an innovation agenda to create jobs in Australia. Without a doubt, innovation is a key driver of business success and can help drive the economy forward. As Bill Gates famously said, “never before in history has innovation offered promise of so much to so many in so short a time”.  

However,  is Australia as innovative as one would hope? A recent NAB Innovation Report Summary revealed just 13% of all firms rate Australia as “highly innovative”. The report further notes that “the number one motivation for innovation across the economy and for SMEs and ASX300 firms is to drive growth and revenues”  Indeed,these elements are important and research and development (R&D) can often boost revenue by investing in new opportunities. Moreover, it is no hidden fact that customers today demand more for their dollar, they expect higher levels of service and greater productivity. Businesses that don’t adapt to change and are content to ‘do it the way they have always done’, effectively put their long-term survival in danger. One way of combating this is R&D, which can involve investigating improved products and services, more efficient processes,  new methods of delivering services and other innovative strategies to get ahead of the competition. Ultimately, R&D is a prime example of innovation and can drive a company forward.

The fact is that many businesses are creating change, researching, developing or innovating, but are unaware that there is a substantial amount of government funding available. A common misconception is that R&D funding is only preserved for those in white coats. This is not the case, as each company engages in unique types of research and development within their business. In fact, the government encourages businesses within Australia to conduct R&D by offering R&D Tax Credits. Perhaps you could  be claiming cash back for the research and development projects you’ve invested in? Innovation can create new opportunities for your business and allow for the creation of new products or solutions. Contact us today to see if you are eligible to claim the R&D Tax Relief.