Innovation Policies: The Australian Lesson Focusing Startup Investments On A Few Strategic Sectors

For some time now, I鈥檝e been pointing out how Australia has been making significant progress, positioning itself as a strong competitor among the innovation ecosystems of the Asia-Pacific region.

The , which organizes every October with the support of , offers a good opportunity to take stock 鈥� also thanks to the data and analysis from the 鈥溾€� report, published with the support of and .

The numbers

Australia is home to 1,582 scaleups 鈥斅� almost six scaleups per 100,000 inhabitants, a remarkable number considering the country鈥檚 relatively small population 鈥� that have collectively raised more than $36 billion in capital (around 2% of national GDP).

Aside from the major Asian economies (the 2 billion-plus-people nations of China and India, which play in a different league with 12,403 and 4,112 scaleups respectively), Australia鈥檚 numbers are not far behind South Korea (2,127) and Japan (2,268), roughly on par with Singapore (1,660), and 3x larger than emerging ecosystems like the UAE (503).

Notably, Australia also stands out as fertile ground for large tech companies 鈥� what we call scalers. We identified 71 Australian scaleups that have each raised over $100 million, a number comparable to Japan (86) and South Korea (96).

This can be explained by the relative isolation of the Australian ecosystem, which has encouraged the creation of national champions in strategic sectors for the continent such as construction, mining and energy 鈥� collectively referred to as 鈥渋nfratech.鈥�

Infratech: Australia鈥檚 house specialty

A closer look at the infratech landscape shows steady growth over the past five years, with venture capital investments rising from $100 million in 2020 to nearly $500 million in 2025.

Among Australian scaleups, about 1 in 10 (107) operate in this vertical, covering the entire value chain: from critical resources (21%) to construction (57%) and energy systems (22%).

Australia鈥檚 dominance in mining AI

As highlighted in the 鈥溾€� report developed by Mind the Bridge with support from , Austmine and , and based on dozens of interviews with mining industry experts, large infrastructure projects promoted by local and international corporations (including ACCIONA, BHP and ) are increasingly integrating new technologies such as AI, advanced robotics, computer vision and digital twins.

Therefore, it doesn’t come as a surprise that Australia leads globally, accounting for nearly three quarters of all investments in AI for mining, far ahead of China (12%) and the United States (9%).

Australia鈥檚 dominance in mining AI reflects structural strengths that are tough to match. The country combines large-scale mining operations, supportive regulations and a mature ecosystem of mining tech vendors and talent 鈥� which made it the global hub for mining innovation.

For companies abroad, this means access to mining AI capabilities now largely depends on partnering with Australian platforms and experts.

Investment landscape: industrial roots, corporate muscle

Investors are also moving into tech areas like space tech, UAVs, drones and autonomous mobility, especially when these intersect with construction and mining applications.

Although Australia鈥檚 investor landscape is broad 鈥� with 491 active VCs and CVCs currently managing around $32 billion of dry powder available for local scaleup investments () 鈥� it remains largely focused on seed- and early-stage funding (the majority of funds 鈥� 73% 鈥� are under $50 million).

However, what鈥檚 particularly interesting 鈥� and consistent with the industrial drive of the Australian ecosystem 鈥� is that most of the mega funds (over $1 billion) are corporate venture capital vehicles. Leading examples include Rio Tinto, as well as banks like , , and .

Specialization attracts international players, dispersion does not

The Australian strong specialization in specific verticals is attracting the interest of global corporates: 26 large international companies have set up innovation outposts Down Under ().

This sends a powerful message in today鈥檚 innovation world, where the concentration of investments in a handful of major ecosystems has effectively reduced the visibility of nearly all others, pushing them toward marginalization and irrelevance.

Specialization, whether in technological domains or industrial applications, can help some of these ecosystems stand out and claim their space on the global innovation map.

For more insights on startup and scaleup ecosystems, see Mind the Bridge鈥檚 reports ().

is chairman of and a professor at . He is a serial entrepreneur who has started three startups in his career, the last of which is , among the five Italian scaleups that have raised the largest amount of capital. He is recognized among the leading international experts in open innovation and has wide experience in setting up and managing open innovation projects 鈥� venture clients, venture builders, intrapreneurship, CVCs 鈥� with large multinational companies, as well as advising and training on this subject. Onetti has a column on () and several other tech blogs.

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