Clifford Heath wrote:
What I think could unleash a wave of investment would be
changes in CGT rules around private residences, to be like
the US model. There, the home is not exempt from CGT,
but the CGT can be rolled-over when you move.
Agreed. I still think this could be the single most powerful thing the
government could do to impact the industry (and which I said in the
lifeguard paper three years ago)
<http://www.siliconbeachaustralia.org/lifeguard/>. I also believe the
venture capital model is broken at a structural level and unleashing the
long tail in investment will also be much more profitable. If you have a
$20m fund, you need to make $20m before you've made a profit: your cost
of capital is damn high, even as a micro VC. But if you invest 50k, all
you need is to get your 50k back and you'll meet your cost of capital.
If we aim for an industry average of $5m for each startup as a return
(where of course, if we make this normal we are bound to get a few $100m
stories), investing 50k when it's $1m means you're now 5x on your
investment, which is better than any VC fund.
But turning the public in angel investors will also do another big
thing: it will make technology more integrated into our culture, which
is what will make the ecosystem flourish.
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