The NSW government will seek about 15,000 square metres of contiguous office space in or near the Sydney CBD for a start-up hub aimed at halting the city's slide in global innovation rankings.
Jobs For NSW, which directs a $190 million government fund for job-creating initiatives, will this week call for expressions of interest from business incubators, accelerators and other entrepreneur-supporting groups like research institutes and venture capitalists to partner in delivering the "Sydney Startup Hub".
The EOIs will be assessed on their job creation potential, the applicants' track record of supporting and attracting start-ups, and the floor area and assistance from government required.
The floor area ultimately sought for lease by the NSW government will depend in part on what these partners need. Jobs For NSW chief executive Karen Borg said "around 15,000 square metres in a single location" was the scale required, if the hub were to contribute meaningfully to her agency's target of 150,000 new jobs for NSW in the four years to March 2019.
"With the planned innovation district at White Bay more than five years away, Sydney urgently needs a focal point where start-up founders and their support ecosystem can gather in the meantime," Ms Borg said.
Sydney fell from 12 to 16 in the latest Compass Global start-up Ecosystem rankings, which Ms Borg blamed in part on the geographic dispersion of its scene.
"We need a place where all the pieces come together, where a founder is sharing space with the mentors, investors and advisors they need," she said.
"The bigger it is, the more collaborations and collision of ideas there will be and the more jobs growth will result."
Jobs For NSW chairman David Thodey said start-ups were more important than general small business in driving jobs growth.
"Over the past six years, high growth SMEs that make up just 6 per cent of NSW firms created over 1 million new jobs," he said.
NSW deputy premier and Nationals MP John Barilaro said the hub was not meant to be exclusive and city-centric.
'It will be a magnet'
"It will be a magnet for start-up events, with shared spaces as well as a landing pad for regional and interstate start-ups looking to do business in and from Sydney," he said.
There are some obvious potential partners for the hub, which could be rewarded with rental subsidies, loans or loan guarantees so long as they continue to meet key performance indicators. Mr Thodey said the indicators would include job creation numbers, supporting events in the hub, and investment funds raised if applicable.
Mr Thodey said local co-working spaces Fishburners and Stone & Chalk had "endorsed the concept". Fishburners has previously indicated a move from Ultimo, where it has a long waiting list, to larger CBD premises. Stone & Chalk, which houses "fintech" start-ups, must vacate its 3000sqm space at 50 Bridge St by the end of 2017, as AMP redevelops the building.
If the Sydney start-up hub does cover 15,000 square metres when it's due to open in the second half of this year, it will be more than twice the size of the current largest start-up precincts, the university-owned Cicada Innovations at Redfern and the new Lighthouse at Barangaroo.
Lighthouse would "complement" the government hub within Sydney's CBD given its focus on more established "gazelle" companies, Mr Thodey said.
A "feeder" of entrepreneurial talent into the hub could be the The Sydney School For Entrepreneurship, backed with $25 million from the NSW government and set to open at TAFE NSW's Ultimo campus this year, Mr Thodey said.
The NSW government did not own 15,000 square metres of contiguous space in or near Sydney's CBD, Ms Borg said, so a private lease or sub-lease would be sought.
Expressions of interest from potential hub partners are due back with Jobs For NSW by May 1, and successful applicants will be announced in May.
Dean McEvoy, the CEO of TechSydney, a lobby for Sydney's technology start-up ecosystem, said: "It's good that the government is listening to the tech industry and providing us with the space we need to build businesses that will power the NSW economy."
However, Mr McEvoy hinted at a future argument with the government. He said a CBD hub should be an "immediate long-term solution" to the start-up ecosystem's space crunch, but Ms Borg said it would be a "bridging solution" until the White Bay precinct was built.
