The NSW Government has made a suite of financial support programs available to SMEs and startups, as well as incubators and accelerators, as part of its long-term plan to accelerate jobs growth.
In releasing the Jobs for the Future report on Friday, Premier Mike Baird explained that small, fast growing companies – known as gazelles – create most of the new jobs in NSW and allowing them to tap into the $190 million Jobs for NSW Fund will help the state reach its target of creating one million new jobs by 2036.
The premier announced the following financial support programs, based on priorities identified in the report:
- A $50 million loan guarantee program, plus a $3.5 million direct loan pilot program, for gazelles to grow jobs.
- $10 million in funding for the state’s network of incubators and accelerators, plus $3 million in start-up grants, to help start-ups evolve into gazelles.
- A $30 million program dedicated to growing regional companies.
- A $30 million fund to attract large and international companies to base their headquarters in NSW.
Karen Borg is the CEO of Jobs for NSW, the private sector-led board, which produced the Jobs for the Future Report and is delivering the financial support programs on the government’s behalf. She spoke to Dynamic Business about the importance of supporting start-ups and gazelles to grow jobs and how the financial support programs work.
What opportunities lie in allocating funding to start-ups and gazelles?
“The Jobs for the Future report outlines that gazelle companies are responsible for creating the majority of the State’s recent net jobs growth. In fact, in the six years to 2014, just 6% of companies in NSW – fast-growing SMEs – created over one million jobs. We want to help grow start-up companies to become the gazelles of tomorrow, and to help gazelles and SMEs to become large enterprises.”
What is the eligibility criteria for the $50m loan guarantee program, and how much can gazelles apply for?
“This fund will be administered on a case-by-case basis and we expect companies to be referred by financial institutions. We will be taking careful steps to ensure the companies we invest in have strong prospects to grow jobs and pay back the loan. There are no currently defined eligible industry sectors. Jobs for NSW can guarantee up to 50 per cent of the amount lent to gazelles by partner financial institutions, up to $5 million depending on the proposal. The loan guarantees typically have a term of two to four years.”
How are incubators and accelerators expected to use the $10m available to them?
“Accelerators and incubators play an important role in providing advice, guidance and support to NSW start-ups, but the Jobs for the Future report found that existing incubators and accelerators are having difficulty meeting existing demand. We want to help grow the network and also improve support for start-ups based outside of Sydney.
“We are likely to provide support to accelerators and incubators on a case-by-case basis, typically to help existing accelerators and incubators to expand or for new accelerators or incubators to be established.
“For instance, we announced on Friday that we are providing support for the Bridge to MassChallenge Australia program – this program has been set up by international accelerator network MassChallenge. We’re also encouraging incubators and accelerators to recommend to Jobs for NSW start-ups to be considered for Minimum Viable Product or Building Partnerships grants.”
