I was alerted to this article which tells of the Australian Government’s funding of 57 research projects to the tune of $3.6 million. Each of the projects was given $64000 to continue development of their projects.

The projects where in such diverse areas as online-training, animation and video-ad serving. Reading down the list I couldn’t help but feel that the vast majority of these projects are not in ground breaking areas, but rather seek to enter an already provided for marketplace. As one commenter to the article said;

Nothing seems new here – it is just a government hand-out to a commercial enterprise. I believe that if you can’t raise/work for $64k without a government hand-out, you most probaby (sic) shouldn’t be an entrepenuer (sic)

I’m a little torn by this comment. On the one hand I agree that it’s not the place of Governments to fund businesses in direct competition with existing suppliers. On the other hand, I heard about some pretty amazing research projects last week that, with a financial small leg-up, could go on to take on the world.

So clearly there are two things going on here – this was an emerging technology grant that clearly should be earmarked for truly emerging technology – a number of these businesses may be up-and-coming, but their product area isn’t emerging.

Having said that on a national and regional scale it is the role of economic development agencies to increase the economic activity in their area. Regardless of whether that economic activity comes from a completely ground-breaking product, or from a “me-too” offering is somewhat academic – it’s all about deriving revenue.

A lot of this relates to a project I’m involved in that will come out of stealth mode in the next few weeks. It’s a simple concept really, one that seeks to help businesses help themselves and others by providing a medium where they can question, communicate and collaborate with their peers – watch this space for some more information about that.

So – what do you think? What is the role of the Government in business building?

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Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

1 Comment
  • As having a libertarian view, I think that it is inappropriate for the government to be Santa Claus to businesses. Businesses should rise and fall on their own. There are heaps of private venture angels/capitalists out there.

    The problem with government helping to fund businesses is that it is very selective, ie, picking winners. One, just have to look at the interest-free loan (~ $NZ 13 million) given to RightHemisphere last year (2007). I am sure that lots of small businesses out there want interest free loans as well, but can’t because they don’t fit the government’s criterias. This sort of bias and picking winners is unfair to the NZ taxpayers.

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