Sydney Startup Hub shuts down in the present day, after seven years, due to the NSW authorities.
And proper now it’s clear that in terms of startups, the federal government couldn’t organise a piss-up in a brewery, to make use of one of many extra well mannered variations of the idiom.
One other means of explaining it’s that they’ve bombed the Sydney Startup Hub to “save it”.
When NSW science, innovation and expertise minister Anoulack Chanthivong revealed the transfer in December 2024 he had no particulars past ‘someplace in Tech Central’.
Eight months on, the Startup Hub’s future continues to be unclear.
The minister, who appears busier than a Round Quay busker, can be in control of the higher regulation, honest buying and selling, trade, commerce, constructing and corrections portfolios.
Minister Anoulack Chanthivong on the NSW Price range Estimates committee listening to this week. Screenshot
So you could possibly forgive him if startups should not on the prime of his precedence record. The sector extra broadly, and this author, have picked up that vibe since Labor got here to energy in 2023 and kicked off by reducing funding to the Sydney Startup Hub.
They began with providing nothing in the direction of within the FY24 finances, ultimately spent $2 million that yr and doubled it to $4 million in FY25. That’s nonetheless simply two-thirds of the $6m the previous Coalition authorities invested in FY23.
However in some way that’s nonetheless an excessive amount of for premier Chris Minns and his authorities, which can be decimating help for small enterprise by killing off the favored Enterprise Join program.
The Hub has been dwelling to Stone & Chalk, Tank Stream Labs, Fishburners, Antler, the incapacity accelerator Outstanding and Microsoft Reactor, and others, in addition to the Regional Touchdown Pad and Worldwide Pad, with room for 1800 folks and round 500 startups.
Its significance to the sector needs to be remembered in Tim Fung, chair and CEO of ASX-listed Airtasker turning as much as assist construct the Tank Stream Labs website there.
Since Chanthivong introduced the transfer, the brand new location felt like a state secret for many of 2025.
However we now know, due to the Funding NSW web site that it’s the Sydney Scaleup Hub at 477 Pitt St, Sydney, 2km down the street, which is being rebranded as Tech Central Innovation Hub.
Deal not executed
The one factor is, simply days earlier than the closure, Funding NSW had not but finalised a deal for a possible operator, as InnovationAus reported on Wednesday. And who’s going there’s additionally up within the air.
And the one tenant, aside from Stone & Chalk, which operates the Scaleup Hub on behalf of the federal government, hoping to relocate there from the prevailing website is Fishburners, which even because the doorways are supposed to shut, is awaiting a inexperienced gentle for its transfer, and is staying put till a minimum of mid-September.
Within the meantime, the opposite tenants have scattered to the winds, ending the collaboration that embodied the Startup Hub because it opened in 2018.
Coworking house Tank Stream Labs and accelerator and investor Antler gained’t be a part of the brand new website and made different preparations. The Microsoft Reactor has gone.
Stone & Chalk, which operates in Sydney, Melbourne and Adelaide, bailed from York Road early, and has been a vocal supporter of Tech Central, with a vigorous social media advertising and marketing marketing campaign backing the idea.
But it surely’s price remembering that they misplaced $6.95 million within the 12 months to June 2023, on prime of a $1.5 million loss within the earlier yr.
Stone & Chalk CEO Chris Kirk
CEO Chris Kirk spent appreciable time righting the ship, telling Startup Day by day in March 2024 that: “Over the past six months, we have implemented a comprehensive action plan to fortify our financial position and secure long-term sustainability. We have successfully worked with our partners to secure additional funding, and at the same time, seen significant growth in our national startup and scaleup community.”
Stone & Chalk’s consolidation from previous website is sensible in that gentle, particularly given the repeated assertion that York Road was “not commercially viable”.
The Covid pandemic remodeled how folks work and whereas the federal government subsidised the Startup Hub website, it’s clear that Stone & Chalk, in addition to Tank Stream Labs and Fishburners struggled below a brand new monetary dynamic.
However the query stays within the context of early-stage startups: what does business viability appear to be and what’s the easiest way to help firms with little money and infrequently pre-revenue in order for you them to come back to town?
In spite of everything, premier Chris Minns is the one who referred to as for employees to get again to their CBD workplaces to help the financial system.
An absence of desks
There was additionally a telling second through the NSW Price range Estimates committee hearings on Monday, when the Funding NSW management was requested concerning the change and the maths didn’t add up.
Liberal MLC Jacqui Munro, the shadow assistant minister for innovation, stated her understanding was that “Wynyard had about 600 desks available, and now there might be 250 desks available”.
Funding NSW head of innovation and entrepreneurship Liza Noonan stated that speaking to the tenants, they’d “been operating at something like 50% occupancy at the startup hub”, whereas three-and-a-half flooring have been vacant for a while – “we lost anchor tenants in corporate terms like Optus and Caltex years ago,” she stated – and “the product that the Sydney Startup Hub is offering was no longer competitive” amid “a very competitive co-working market in the Sydney CBD”.
The Tech Central Scaleup Hub at 477 Pitt Road, designed for extra mature firms, provides suites and different amenities for 60 scaleups, in addition to shared workplace house throughout two flooring, with round 150 desks. It was developed by the previous Coalition authorities.
Noonan stated there’s a minimum of 100 extra desks out there on the Pitt St website for the transfer.
I’m not Sir Isaac Newton, however might I counsel that if “around half” of 600 desks have been getting used, and the brand new supply is “at least” 100, and apparently 60 startups have already put their hand up for house, even for those who assume the 150 scaleup hub desks are additionally out there, you’re nonetheless providing much less house than the Startup Hub’s present utilization ranges.
As a result of the price of a desk can’t be disclosed, one thing that puzzled Munro in a chicken-before-the-egg means, it’s onerous to determine whether or not it’s a difficulty in comparison with the previous website. Are founders being priced out of Sydney? We don’t know.
Noonan advised Price range Estimates “we do believe there’s vacancy. I’d have to take on notice the exact amount of vacancy within the Stone and Chalk floors”.
Followers of Sir Humphrey in Sure Minister would admire the genius of this: there are vacancies on the website the place we haven’t sorted out who’s working the place and nor a deal to relocate the organisation desires to maneuver in. There needs to be a podcast on how detectives solved the thriller of the empty desks.
Antler started life on the Sydney Startup Hub in 2019. It’s moved elsewhere with the shutdown
Greater than 1,800 startups have been residents on the 11-floor constructing above Wynyard prepare station. Collectively they’ve created round 6000 jobs and attracted practically $1 billion in funding, whereas one other 50,000 folks have been to greater than 1000 occasions there, and one other 4000+ entrepreneurs from regional NSW have dropped in to make use of free desks and assembly rooms there.
That’s in response to Funding NSW. That determine appears like an inexpensive ROI for taxpayers, particularly for those who examine to measurement, scale and returns of different authorities trade help.
The Minns authorities broke the York St lease. How a lot doing that has value taxpayers is one thing Funding NSW stated it needed to “take on notice” – a shocking possibility since this debate is all concerning the enterprise case and its value to taxpayers.
Noonan stated they’d been actively attempting to fill that house, there wasn’t market demand.
“So I think we go back to the point, and the reason the decision was made was that the commercial models of the anchor operators in the Sydney Startup Hub was no longer viable based on post-Covid working habits of startups,” she stated.
A historical past of value reducing
In the meantime, please keep in mind is that the NSW authorities gutted Funding NSW in April 2024, with 1 / 4 of its workforce reduce, and positioned it below the management of premier Chris Minns, the person who can discover $16 million for cage fights staged by a verbally abusive promoter, but reduce startup funding, together with to the Sydney Startup Hub, when Labor got here to energy in 2023.
The federal government is spending $5 million in capital expenditure on the relocation, together with making the scaleup hub extra appropriate for startups, with a refurbishment of degree 13.
Again at York St, 3.5 ranges on the CBD hub have been empty for “some time”, Noonan stated, and there has not been a “market demand” to interchange departed company tenants like Optus and Caltex.
“We looked at the market demand at the [startup] hub, and we looked at the current occupancy of the Scaleup Hub. We thought there was a real opportunity to consolidate services and programming for startups at all stages of their journey within Tech Central,” she stated.
“So our view and our modelling was that that was the best course of action.”
Munro requested what was occurring with Fishburners saying “they’ve started partnering with WeWork – is that because they haven’t been able to come to an agreement that allows them to move into Tech Central?”
“We’ve been engaging closely with fish burners throughout this entire process. My understanding with Fishburners is that they’ve had a fairly significant look at their business model and looking at the needs of startups that they serve,” Noonan replied.
“And they’ve actually had feedback from residents that they’d prefer a more networked approach, including residency here in Sydney, but also in locations around the world which the partnership with WeWork.”
She didn’t need to touch upon what’s occurring or the price of desks on the new location as a result of “we’re in negotiations currently with the anchor operator [at the Scaleup Hub]… so I wouldn’t want the statement I make here to impact the outcome of those negotiations for both Fishburners, other operators in the ecosystem, and obviously for startups themselves will accommodate.”
“Negotiations” is really gobsmacking. Eight. Months. On.
It’s onerous to consider that anybody within the Startup Hub, given the sector’s mindset, tried to tug out negotiations, so the place ought to blame be apportioned for uncertainty for the tons of of founders and startups in search of a spot to work and unclear about their future within the week when the federal government is shutting down the location?
Munro requested about why it’s shutting now, when the unique launch stated October. Funding NSW appeared unaware of that element. We quoted Minister Chanthivong’s “October” announcement right here final December in the event that they want a reminder.
Not my fault
Earlier in Price range Estimates, minister Chanthivong, who proved to be a grasp of delegation by way of who was answerable for selections, blamed the previous Coalition authorities for the demise of the prevailing Startup Hub. The Laboregovernment made the “right decision”, however Funding NSW is answerable for what’s occurring with the relocation.
TL;DR. Wasn’t me gov, sincere reality.
“The government made the decision to wind up the Sydney Startup Hub based on the fact that the contract that was signed by the former government was so bad that it needed to be totally revamped,” Chanthivong stated.
“The communication process with the tenants has been happening since late last year, the government made a very clear decision in winding up the Sydney Startup Hub given its non-commercial viable nature, and the management process of the relocation of tenants, is something that I’ve tasked the Investment NSW to manage.”
Munro requested is the minister would meet with the startup sector to listen to their issues.
He obfuscated and declined.
Minister, I’m asking you on behalf of the startup sector and founders in NSW to decide to holding a public listening to the place folks can ask you and Funding NSW questions in order that they know what’s coming and what’s occurring from you, because the minister accountable. Will you’ll you try this?” Munro requested, for a second time.
“Look, Stone & Chalk support the move and as do the anchor tenants. The government, through Investment NSW, has tasked the department to provide ongoing support and advice for those who seek to relocate,” Chanthivong replied.
The promise
“New accommodation at Tech Central will include a refreshed service offering more attuned to supporting diverse people and teams to startup and scale successfully. It will continue to offer an affordable place for both startups and scaleups to meet, collaborate, work and grow,” the Funding NSW web site explains.
“This move helps ensure startups and scaleups can collaborate with an entire ecosystem right on their doorstep. It’s all about giving the support to build Australia’s next tech unicorn.”
One other strategy to describe the federal government’s plan – it’s hoping to launch an precise technique for Tech Central at some unnamed time down the observe may finest be described as Covid redux.
It’s hoping that by strolling previous Canva in Surry Hills on the way in which to work, startup founders may catch unicorn vibes and change into billion-dollar tech firms too.
Then the minister can stand beside them in a hit story photograph alternative.
Besides he gained’t get to, nor will future ministers, as a result of proper now, Sydney startups must survive regardless of the NSW authorities, not due to it.
Startup Day by day approached the minister’s workplace with an in depth record of 12 questions, however didn’t obtain a response earlier than publication. The response has now been included beneath, however most of our questions have been ignored.
Stone & Chalk and Fishburners additionally didn’t response to requests for remark.
Editor’s word: A spokesperson for the minister issuing the next assertion shortly after publication:
“The Sydney Startup Hub is a chief instance of the Liberal-Nationwide Authorities’s legacy of waste and mismanagement.
“After they signed the contract to run the Hub in late 2022, they knew the COVID-19 pandemic had impacted startups and decreased demand for workplace house.
“Since then, the hub has constantly struggled to fill out there desks, generally sitting at round 50% capability.
“Former Minister Alistair Henskins and the Liberal-Nationwide Authorities locked taxpayers into subsiding workplace house that nobody needed. Their resolution has left taxpayers, authorities, startups, and anchor tenants all worse off.
“Funding NSW stays in negotiations with Stone & Chalk, the anchor tenant on the Scale Up Hub, for the transition of start-up companies into a brand new Tech Central Innovation Hub.
“The NSW Labor Authorities tackles points head on to scrub up the mess that the Liberals left behind and we’re working to make sure the brand new Tech Central Innovation Hub is sustainable and worth for tax payer cash.
“Transitioning to Tech Central will allow founders, entrepreneurs, traders, and corporates to collaborate extra carefully with universities and analysis institutes, in Australia’s main innovation precinct.
“In the 2025-26 Budget, the NSW Government committed around $80 million in support for the innovation sector, including $38.5 million for Tech Central.”
Disclosure: Startup Day by day hosted common occasions on the Sydney Startup Hub, and sponsored a few of its tenants. Fishburners CEO Majella Campbell cohosts Startup Day by day’s weekly podcast, Startup 360, with this author. We additionally utilized for an Funding NSW grant for the Finest in Tech awards, but it surely was declined.
