Malcolm Turnbull

China picking Australia's smartest brains for next generation of entrepreneurs

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Prime Minister Malcolm Turnbull kick-started the innovation lovefest last year. Now, the Chinese city of Shenzhen is getting in on the action, opening up pathways for the next generation of Australian entrepreneurs.

Ian Davis is abuzz as he explains how his company's invention, the Inkerz smart pen, works. The product consists of a real pen and real paper but anything drawn or written on the page is duplicated in a computer program which is visible both on-site and over the internet.

Mr Davis says it's a tangible product for the virtual world.

"It just clicked with me immediately and I said this can really revolutionise education. And yet it keeps the core of the educational process and the importance of handwriting," he said.

Mr Davis is chairman of the company and says it's never been a better time to be entrepreneurial in Australia. But, he adds, the domestic market is small and ideas without financing only get you so far.

"Always start with family and friends, but after family and friends you need an angel. Somebody who really believes in what you're trying to do, believes in the potential of it and says I'm going to put my money where my mouth is and help you get your start."

That's why companies like Inkerz are increasingly turning away from markets like the US for that cash injection and more towards China, where, they say, capital is more freely available and investors more audacious.

The southern city of Shenzhen, just north of Hong Kong, is at the forefront of this investor movement. Officials from what's known as the Silicon Valley of the east launched a innovation scouting mission this week, in the form of a global competition.

Victor Wang is the director of the Shenzhen Economic and Trade Office in Sydney, which came up with the concept. He says a share of around 140 million dollars in venture capital is up for grabs.

"The next 30 years, what's our direction? Innovation is the key to our next success. From the local Shenzhen government, they're very keen to bring together all of the talent, especially some talent from overseas, to learn from them, to provide a platform," Mr Wang said.

Twenty-five finalists in high tech industries will be selected from hundreds of entrants across Australia, Germany, the US, Israel and Japan.

The winner - to be announced at a competition finale in Shenzhen in April - will also receive help from the Chinese government setting up a company in Shenzhen.

"In Australia we have small markets and we have a difficult environment to raise capital in. In China, the thinking is much bigger. People raise one, two, three millions dollars in their first round of capital up there," says Brent Clark, who won a much smaller predecessor competition run by the University of New South Wales last year.

Ian Davis and his colleagues at Inkerz plan to enter the Shenzhen innovation competition.

Mr Davis says - with 18 employees - Inkerz would use any funding it won to grow further, faster.

"Big thinking, we'd love to be 100 million plus in sales of people, which would mean millions of customers. using this product for tutoring, for in class education, for corporate training, for online testing, for a whole range of educational applications and quite frankly applications we haven't even thought of."

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