New report maps out Australia’s impact startup ecosystem
8 April 2021 at 4:55 pm
Giant Leap Fund has launched its first Impact Startup Landscape Report
Impact businesses made up around one fifth of all funded startups in Australia over the past five years, new research reveals.
An analysis of more than 1,600 Australian startups that have publicly raised funds between 2015 and 2020 found about 20 per cent could be classified as impact startups, meaning revenue generated was inherently linked to creating measurable positive social or environmental impact.
This data forms part of a newly released landmark study from Giant Leap Fund that has mapped out Australia’s impact startup ecosystem.
The Impact Startup Landscape Report found the percentage of impact startups as a proportion of all funded Australian startups has increased from 15 per cent to 23 per cent over the past five years.
Giant Leap Fund managing partner Will Richardson said impact was now “on the lips of just about every investor around the globe”.
“It’s now front of mind for just about every VC (venture capitalist) in Australia as it’s proven time and time again to lead to greater returns in addition to positive societal outcomes,” Richardson said.
“Yet, until now, there’s been no granular data in Australia on the scale of this trend. This report looks to fill that void and create a baseline for future growth.”
Out of the Australian impact startups reviewed by Giant Leap, the largest proportion (46 per cent) focused on issues of sustainability, in particular the energy, food, and waste sectors.
Charlie Macdonald, a Giant Leap Fund associate, told Pro Bono News that impact founders and future impact founders could use this data from the report to shape their own startup ideas.
“In Australia, we’re seeing a really strong focus on sustainability. Australians have proven to be really adept at focusing on sustainability issues around food, waste and energy,” Macdonald said.
“And so the hope is that people reading this will see those specific areas and maybe come up with or be inspired to act on ideas of their own in this space.”
The report found there was a large and vibrant ecosystem supporting the sector, with 67 organisations providing direct support to impact startups such as funders and accelerators identified in Australia.
Researchers also noted a 2019 Thomson Reuters Foundation report that ranked Australia as the second best country in the world to be a social entrepreneur.
Macdonald said this showed there were great opportunities in Australia for impact startups.
He said with the nation’s strong financial infrastructure, huge generational wealth, and socially-minded population, Australia was well placed to become an impact startup hub.
“And simultaneously, we’ve also got one of the largest agricultural land masses of any country on Earth,” he said.
“So there’s great potential for things like sustainable food production and regenerative land projects… all of these elements set us up well to be an impact startup hub.
“And I’m really excited to see what happens next.”
You can see the full report here.