Yesterday, Afterpay Ltd (ASX: APT) CEO Anthony Eisen discussed the need for a tech hub in Australia, as the company’s share price bounced back from the recent tech sell-off. The topic was a part of a broader conversation on ‘supercharging Australia’s digital future’ at the AFR’s Business Summit.
The billionaire co-founder of the buy now, pay later (BNPL) behemoth stressed Australia’s need for an environment conducive to tech success.
Afterpay is proof it can be done
Australia really is a beautiful place, but both Anthony Eisen and Xero Ltd (ASX: XRO)’s CEO Steve Amos think it could so much more in terms of technology.
In the past, some have argued that Australia lacks the talent to make the investment worthwhile. However, Eisen strongly disagrees with that notion, stating “What Australia lacks is not the talent, just the experience. When you are creating global platforms, getting the experience level in the country is a real key enabler.”
Eisen pointed to examples such as Silicon Valley and explained that these are not simply geographic destinations for tech success, rather they are mindsets.
Afterpay’s success was used as an example by Eisen to demonstrate that tech success at a global scale can be achieved right here in Australia. The co-founder added that government and industry support is needed for it to become a consistent occurrence.
Despite massive fluctuations in the Afterpay share price, the company has expanded throughout the world in just a matter of years. The progress likely wouldn’t have been possible if Australian regulators and/or the government blocked its rollout locally.
Could it already be in the works?
Encouragingly, in June last year plans were announced to develop an ambitious 40 storey tech-hub tower in Sydney. The development should commence by June this year. It has attracted the backing of Australian-founded Atlassian Corporation PLC (NASDAQ: TEAM). However, the building isn’t expected to be completed until 2025.
The desire for a local tech presence is not driven solely by egoism either. After decades of propagating globalism, many countries are beginning to shift towards a more ‘in-house’ approach. A move that is largely due to security concerns.
As reported by The Australian, Aussie tech hub instigator Alex Scandurra is leading the charge through his company Stone & Chalk. Recently, the not-for-profit fintech hub operator merged with the Australian Cyber Security Growth Network. Scandurra commented, “Increasingly we need to be able to develop companies in Australia as opposed to buying from overseas suppliers and vendors.”
Now could be the best time for governments to invest in building tech hubs, given the high levels of unemployment still experienced in Australia. Afterpay’s success proves that Australia can be at the forefront of technology leaders. Meanwhile, the growing market in cybersecurity offers further opportunities for local success.
Will the Afterpay success story continue as Paypal confronts the Australian BNPL market? Only time will tell.
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Mitchell Lawler owns shares of AFTERPAY T FPO. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Atlassian and PayPal Holdings. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and recommends the following options: long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia owns shares of Xero. The Motley Fool Australia has recommended PayPal Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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