The Changing rules of business - and why that's good news for rural and regional Australia

Times they are a changin’. Ask anyone that's been in business for a while and they will say the rate of change in the last five years is unprecedented. Look at your own behaviours as a consumer and chances are the way you engage with companies, the way you shop, the service you expect is vastly different from the way you navigated the world only a short time ago.

Whether you are a business that sells household products online or a bulk commodity producer for an export market - times are changing.

Perhaps the biggest trend we are seeing that is having positive impacts for rural and remote Australia is the dropping of the common barriers to business. This is seeing a rise in the sole trader or micro business. The Australian economy added over 1000 such small businesses to its population over the two years between 2014 and 2016. Taking the total number to 599,000 up from 572,000.  This number and the trends we believe are driving this increase are all good signs for rural communities all over Australia. This is Part One of a three part series of the changing rules of business. 

1.                   Access to Capital

Without doubt the biggest shackle for small business has been access to capital. Whether that's startup funds, overdrafts to meet cash flow sticky spots, funds for innovation activities or capital injections to fund expansions into profitability. Even with bank cash rates at such low rates it is still hard for small business to get the attention of the big banks. It's difficult for banks to profitably serve SMEs, globally they only account for 20-30 percent of total revenue and SMEs are beginning to notice they're not a priority. However the rise of alternative funding models has given some hope in this area.

Online lenders, Angel Investors, incubators, Government grants and crowdfunding have all emerged as options small business are actively pursuing.


Rural Business Collective accessed startup capital through a crowdfunding campaign on the platform Startsomegood in conjunction with startup competition ING Dreamstarter. Usually the domain of artists and the latest gadget idea, crowdfunding is now definitely a platform for all businesses to get involved in. Even farmers! Jonai Farm in Daylesford Victoria have funded two infrastructure builds through crowdfunding; offering rewards such as a farm calendar through to cuts of their specialty cured pork cuts. And even if you aren’t aware of crowdfunding most people have heard of the wildly successful FlowHive Campaign where a father and son team from Byron Bay raised a staggering $12 million!

Online Lenders

Another avenue that was once for a limited number of businesses that has opened its doors far and wide are the Online Lenders. The growth of online lenders has no doubt been driven by the small business market. The growing number of lenders tout fast turnarounds, seamless transactions and competitive rates. A quick Google search for options available to Australian small businesses directs you to a number of lenders such as Prospa, Waddle, FundingPro, GetCapital, Kikka Capital, Merchant Cash, Moula, SpotCap and Sail. A recent Financial Review article noted SpotCaps rise in popularity “Spotcap has lent $35 million to Australian small businesses over its first 19 months of operations, with the book growing by 450 per cent over the year to December 2016 as the fintech expanded its distribution capability through deals with broking networks.”

Angel Investors

In Beating Around the Bush podcast episode with RBC member Kris Trevilyan we got behind the doors of an Angel Investing deal table. Kris is a member of the well established and run Angel Investor group Brisbane Angels. Here they see regular pitches and approaches from startups and scalable businesses that have utilised their network of ‘friends, family and fools’ and are looking for not just the funds to grow but also the wealth of knowledge, experience and mentoring that comes with Angel Investing circles. Not something you get with online lending or alot of small business banking at bigger institutions. Angel Investment networks and individuals are starting to pop up in every state of Australia. Have a search around some of the aggregator sites to get a feel for what’s out there and what they are looking for:

angel website.jpg

Incubators and Accelerators

Startup Incubators and Accelerators are starting to pop up all around the country in a variety of different sectors from Education, technology, Agriculture, healthcare, finance and more. Each with their own entry criteria and inclusions. Many corporates are also partnering with Incubators and Accelerators to uncover the next innovation activity they can work within their business acknowledging that innovation is more readily found in the startup space than in corporate offices. Incubators and Accelerators help small business “By providing mentoring, office space, professional services and finance, the incubator has helped many startups validate their ideas and achieve success” according to the Australian Governments Innovation website.

There is certainly some overlap in the services and support provided by Accelerators and Incubators however the defining element is the stage at which you enter each of the programs. Incubators are as the name implies - early stage. These are for new startups looking to validate and get their idea to market. Accelerators however are more for by comparison for the Adolescent startup. Concept has been proven and they have some traction and are looking to raise funds or take it to the next level by scaling to a larger market.


Government at both a State and Federal level are starting to see the wins in investing in small business. The Government itself has claimed Small Business as the engine room of the country so it only makes sense that dollars invested in its development and success will return for the government. There are many programs out there for small business particularly those that are looking to implement innovation activities or looking to undertake any research and development in their business. The days where only non-profits could access the bulk of programs in the government are changing too with many programs open to company structures. Queesland’s impressive Advance Queensland programs are certainly leading the way for the States. Federally AusTrade and Innovation portfolios are doing great things also.

Join me again tomorrow to talk about the access to skills and technology.