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Will the Innovation Tax Incentive increase investment?
I was at an Egroup meeting earlier this month and Marc Loftus from BDO was presenting on the new Innovation Tax Incentive. For information on the Innovation Tax Incentive see my earlier post here. A question came from the floor on the subject of what impact the Innovation tax incentive was likely to have on levels of investment. The UK has a similar Innovation tax incentive called the Enterprise Investment Scheme (EIS). The EIS was highly influential on the new Australian Tax Incentive legislation. I was in Scotland from 2006 to 2009 working in the startup and innovation space. I had a fair bit to do with Scottish Angel investors who I knew were using the EIS. I also remembered reading reports on the impact of the EIS on the levels of investment. So I thought I would dig those up and share them.
The UK government introduced EIS in 1992 with the purpose helping types of small higher risk unlisted companies to raise capital. So there is a fair bit of data available to gauge the impact of that scheme.
What do the UK studies reveal?
The earliest report I have found was produced by NESTA in May 2009. That report entitled “Siding with the Angels Business angel investing – promising outcomes and effective strategies” found that:
“Eighty per cent of investors surveyed have made use of the Enterprise Investment Scheme, at least once. And 57 per cent of their investments had made use of the EIS.”
and
“Investors said that 24 per cent of their investments would not have been made without tax incentives.
In January 2015 the Enterprise Research Centre released a study called “A Nation of Angels: Assessing the impact of angel investing across the UK”. In their report it was stated:
So… tell me about Techboard’s Announcements Platform
We are working hard here at Techboard to help raise the profile of Australian startups and technology companies. One key way we do this is by providing free access to our Announcements Platform. We have been getting some questions about how our announcements platform works and as to what benefit a company can get from making announcements we have also just made some improvements to the system to make it work how we had always intended and make it easier for people authorised by a company to make announcements. So we thought it was time to do a post.
Our Announcements Platform enables any Australian Startup and Tech Company, listed or unlisted to make announcements and increase and enhance its profile. Companies can make an announcement on any big or small developments they want to share with their audience and the Techboard audience. We have a bundle of different announcement categories so companies will probably find the right one for them. This also makes it easier for our readers to find an announcement that is interesting to them.
Companies shouldn’t limit themselves to news that traditional media channels are interested in…. your fans are interested in your little steps, and your incremental progress as well as your huge ‘newsworthy’ wins.
Check out the latest announcements that have been made on Techboard
Senate Passes Innovation Tax Incentive Legislation – 4 May 2016
Earlier today the Senate passed the Tax Laws Amendment (Tax Incentives for Innovation) Bill 2016. This Legislation which is expected to be in force on 1 July 2016 provides generous tax incentives for investment in eligible new innovative companies. Techboard Panel of Experts member and BDO partner Marc Loftus has prepared a summary of the bill that can be downloaded below.
Techboard Update 21 April 2016
Techboard Problem Solvers Board
Techboard is now taking registrations from Problem Solvers who want to promote their services to Startups and Tech companies. Solvers (service providers) are only listed if they are validated by a company listed on Techboard by creating a connection describing the service, which the startup receiving the service can comment on. Once a company is validated the connection appears on both the Problem Solver’s and Company’s profiles. When we have more problem solvers registered we will activate the Board to enable startups and Tech companies to search for suitable Solvers. We feel that the approach we are taking with Problem solvers provides greater opportunity for Startups and Tech companies to have their profiles raised by their service providers who are incentivised to talk about what they have done to help a company listed on Techboard.
Website Refresh
Techboard’s Homepage has been updated with more videos including featured Companies and a new widgetised structure that enables us to add new components when they come on line such as the Problem Solvers Board. Check it out.
Techknow Invest Roadshow Videos
Videos from companies presenting at the Techknow Invest Roadshow are now available on Techboard. Just visit the homepage.
Announcements
It has been a busy few weeks for announcements on Techboard with 23 announcements since our last general update on 1 April. We have had product Launches, Team updates, rebrandings and news updates announced on the platform with too many to list here so here are some highlights. All announcements are published on company profiles and can also be viewed here.
- iWebGate signs provider for NASA and US Air Force.
- Launching our New Explainer Video – Covocate.com
- iSignthis and Coinify deliver AML regulatory compliance for easily, instantly & securely buying bitcoin via cards
- Astron’s automated shark detection product Sentinel VDS featured in local media
- New Co-founders join My Storage
- Storekat listed as a top 5 to watch on ideashoist
- MiPlan is featured in National Mining Chronicle – March edition for product innovation
- PD Online rebrands as CourseGenius
- Launching our latest – Paytradie Explainer Video
- Norwood Systems TechKnow Roadshow Presentation April 2016
- Astron to develop intelligent shark detection system using drones
- Fleetsu – Exciting First Quarter
- Velpic Releases Mobile App
- Aeronavics and Australia’s Airscope form partnership
Innovation Tax Incentives Bill Analysis
On 16 March I published a post on the new Innovation Tax Incentives Bill and 
promised to come back with more analysis. Our friends at BDO have done such an analysis and have concluded that while the legislation provides further incentive for investment in innovative start-ups, some of the eligibility requirements are overly restrictive and time consuming for start-ups to comply with.
Suffice it to say that the Bill is pretty complex, in terms of figuring out if a startup is an eligible company, with a points based formula, the possibility of rulings and with further rules able to be set by regulation. The investor eligibility rules are pretty complicated as well.
What is clear is both retail and sophisticated investors can benefit from the tax breaks on offer… but not equally… and investors investing too close to home (including founders) are not eligible.
Vocus Upstart Meet the Mentors night
Do you have a killer idea for Vocus Upstart, and want some expert feedback to focus in on your customer issue, market opportunity, product development or scaling potential?
Happening on April 11th at Spacecubed from 5:00pm-7:00pm, you will get the opportunity to meet a selection of our All-Star mentors and sit down with them for a 15 minute 1on1 - come along and discuss your ideas and get critical feedback.
Monday, Apr 114:45 PM—7:00 PM
Techboard Partners with Techknow Invest Roadshow
Techboard is pleased to announce that it has partnered with Techknow Invest Roadshow 2016. As part of this partnership Techboard will provide all companies presenting at the Roadshow with a profile on Techboard where content from the Techknow event can be viewed post conference by conference delegates and any investors from Western Australia who were unable to make the trip to the east coast.
The partnership with the TechKnow Invest Roadshow also marks a milestone in Techboard’s mission to become the place for startups and tech companies from all over Australia to get noticed (until now companies needed to have a strong Western Australian connection to be eligible to list). The relationship will also strengthen Techboard’s position as a place to discover intelligence and insights on Australian technology companies and startups.
David Tasker from PPR said “We are keen to be partnering with Techboard and on the great work they are doing locally to raise the profile of the Western Australian startups and tech companies including with their Startup Ranking.”
Read More
Tax Incentives for Innovation Bill Introduced to Parliament
Today I received notification from Treasury that the Tax Incentives for Innovation Bill had been introduced to Federal Parliament. This was following a submission I made on behalf of Techboard to the recent Treasury consultation on the tax incentives pushing for a number of changes to the approach that had been advocated in the Treasury discussion paper including the removal of a suggestion that the tax incentive only be available to sophisticated investors. I have skim read parts of the Bill and Explanatory Memorandum and am pleased to report that retail investors will be able to access the Tax incentive, with some limitations including a $50,ooo limit on the amount that would be eligible.
We will be looking at the Bill in more detail and will report back soon.
If you want to read the First Reading version of the Bill and Explanatory Memorandum. Head over to Parliament’s Website Here.
Peter van Bruchem
Chief Startup Evangelist
Techboard
25th WAIITA Incite Awards 2016 applications closing soon
The Western Australian Information Technology and Telecommunications Alliance (WAITTA) - through the WA Branch of the Australian Computer Society Inc. - has been conducting an annual award since 1991. The purpose of the awards is to recognise outstanding performance and contributions by members of the ICT community in Western Australia.
INCITE spans ICT excellence across 10 awards recognising individual achievement, product innovation and project excellence. The INCITE Awards provide opportunities to both the companies at the cutting edge of technology innovation as well as leading professionals across the industry to be recognised and celebrated.
This year the awards are split into 10 categories including StartUp of the Year which is open to companies in the early stage of commercialisation that are high-growth, high-risk ventures that set out to find a scalable business model in a large market.
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