Australians may well be fascinated with stories of a small investment in the emerging efforts of the likes of Apple, Google and Facebook turning into millions, but that’s about it.
- Despite the possibility of high returns from early tech investments, most investors believe it is not worth the risk
- Companies like Atlassian, Seek, ResMed beat the risk aversion to grow from start-ups to successful listed corporations
- Tech stocks account for only around 1 per cent of the ASX by value
It seems as a nation we are not prepared to put our money where our mouse — or any other tech gadget — is.
So are Australian investors risk-averse, or just smart, given the chances of picking a winner among the start-ups is a bit of a lottery?
It is a question Perth-based video game developer Stirfire Studios is asking itself having failed to find backers for an ASX listing.
The company behind the virtual reality video games Freedom Fall and Symphony of The Machine had hoped to raise between $5 million and $7 million, but managed only half of that by deadline.
“Obviously it’s a bit disappointing, but we are going back next year for another try,” Stirfires’s chief executive Vee Pendergrast told The Business program.
“So not giving up, getting a few more runs on the board as a company.”
Ms Pendergrast took Stirfire’s story on a roadshow to talk to potential investors in Sydney, Melbourne, and Perth.
However she found many were worried about the risks of investing in early-stage tech.
“Most of the investors here are used to dealing with the resource sector primarily, and tech is still a really new thing to them,” she said.
“If you were pitching in somewhere like Canada, the UK, or America, people would…