Government Relations for Startups and SMEs

Government Relations for Startups and SMEs

Since Malcolm Turnbull famously went to the public with his Innovation Agenda in 2015, governments of all levels and political leanings in Australia have shown an increased interest in supporting the innovation ecosystem in Australia. Some governments have even injected tens of millions or even hundreds of millions into supporting growth in “innovation”, sometimes in ways that the sector is confused about or disagrees with. As with anything related to economic growth, which doesn’t fit nicely into constitutionally defined responsibilities, this is a complex landscape in which federal, state and local government all play, sometimes seemingly doing the same things. Alongside this, governments have been trying to bring themselves into the 21st century, and as those governments increasingly become consumers of the solutions created by the innovation and tech sector, startups want to know why they aren’t getting those big government contracts and how they can even get a foot in the door.

At Binary Shift conference in Gippsland 2018, I gave the closing keynote on this topic. The presentation consisted of an overview of the support landscape and focus on relationship building and management with governments, as well as the “Why?”.

I aimed to answer some of the questions startup founders and employees have about interacting with government, including:
What is the role of grants in funding startups? Do I qualify? Why/Why not?
How does government procurement even work and how do I get myself on one of these mysterious ‘lists’?
What the heck is an ‘innovation ecosystem’ and what is a ‘digital economy’? Do governments just make these words up?
How do I maintain positive relationships with government representatives and advisers pre and post any financial or other assistance?

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Bec Martin

August 27, 2018
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Transcript

  1. 2.

    2 Bec Martin Technology enthusiast, a tinkerer and lifelong learner

    working at the intersection of government, startups and technology. Former adviser in Victorian Government. E: bec@coderbec.com T: @coder_bec
  2. 4.

    4 Why is Government Relations Important? There are many reasons

    why the government is an important consideration for startups SMEs and the innovation sector Opportunity cost of funding and grants Regulatory environment Opportunity cost of procurement Your competitors are thinking about it
  3. 5.

    5 Relationship Building & Management Strategies for DIY Larger companies

    deploy: • Corporate/Government internal team • Lobbyists Strategies for “DIY” Gov Relations • Know who your local member is – upper/lower house, state & federal gov. • Ministers can rarely do site visits where there’s no asks, but members can. • In some cases, NFPs can obtain pro bono assistance https://www.parliament.vic.gov.au/findelectorate/
  4. 6.

    6 Grants The way we think about grants doesn’t reflect

    their purpose or intention Grant Investment Tax Incentives What is a grant? • No equity • May require co-investment or other measures of sustainability • Usually funds a specific project within an entity that is equipped to serve the purpose the grant pool was set up for What isn’t a grant? • Isn’t startup capital • Isn’t used for the whole entity or project • Isn’t used to develop your core commercial offering
  5. 7.

    7 Grants Principles The purpose and nature of grants is

    often misunderstood Grants are not a substitute for private investment The merit of your project doesn’t speak for itself Grants are for very specific purposes and you can’t retrofit them Grants come with a lot of strings Every grant funding decision has to be defensible As a tax-payer, you want grants programs to be judiciously deployed
  6. 8.

    8 Procurement Procurement can vary in size and complexity Panel

    EOI/Tender 3 Quotes/Service Contract State Purchase Contracts: “State purchase contracts (SPCs) are standing offer agreements for Victorian government common use goods and services, which are established when value for money can best be achieved through aggregating demand.” Market Led Proposal: “one made by the private sector to government to build infrastructure and/or provide services. It originates within the private sector and involves proponents developing a project or service specification and then approaching Government for approval and support of the proposal.”
  7. 9.

    9 Procurement Process There are many useful guidelines and process

    documents available publicly Expression of Interest Introduction Part A – The Invitation Part B – Conditions of Participation Part C – Invitees Response Invitation to Supply Introduction Part A – The Invitation (Specifications) Part B – Conditions of Participation Part C – Proposed Contract Part D – Offer Contracts Low complexity Goods Low Complexity Services One off purchase Goods One off purchase Services Sole entity purchase Goods Sole entity purchase Services Supporting guidelines Market approach Specification writing Developing an offer template Insurance provisions Managing contract price reviews Evaluation, negotiation and selection
  8. 10.

    10 Procurement Principles General principals for increasing your opportunity with

    procurement Building relationships is just as important for gov sales You can’t ‘guilt’ people into taking a look at your product While some policy is onerous, there is some that works in your favour If it’s something that you’re not the only provider of, probity comes into play You have to be in it to win it As a tax-payer, you want procurement to be subject to probity