Australia has proven it can build unicorns. Canva, Atlassian, Afterpay and WiseTech are a few names to mention. But to repeat that magic at scale, more than VC dollars are needed.
The startup scene in Australia is full of promise. Tech unicorns rise from dorm rooms to global dominance.
So, you might think Australia’s proven knack for birthing billion-dollar companies would guarantee a steady flow of cash and innovation. However, despite the success stories of Canva and Atlassian, the funding winter is still biting hard. And here is the kicker: capital is only one part of the equation.
Let’s talk about the other side of the coin — the development journey. Even the best-funded startup can fizzle out without a solid full-cycle software development approach. So, while investors are focused on ROI, maybe it is time we also talk about what happens after the term sheet is signed.
Unicorns per dollar? Australia crushes it
Since 2000, Australia has produced 1.22 unicorns per US$1 billion (AU$1.5 billion) invested. It is the best ratio in the world. That’s almost double the United States. Yet in 2024, Aussie startups only raised US$3.4 billion. It is definitely far off the 2021 peak of US$6.5 billion. Compare that to US$24 billion in early-stage funding for American startups or US$10 billion for Chinese ones.
It is not for lack of talent. From Sydney to Melbourne to Brisbane, founders are building in software, fintech, energy tech, health and the creative industries. But funding often dries up before ideas fully bloom. The pool of domestic capital is shallow and a whopping 39% of early-stage capital in 2024 came from overseas investors. That is significantly higher than in the US (21%) or Europe (27%).
What happens after you raise?
Here is where most startup stories in the media fade out. The founder raises X million, celebrates with a LinkedIn post and that is it. In reality, the hard part starts after the funding hits the account. That is where a full-cycle software development company comes in. It is something many Aussie startups are still underinvesting in.
What is full-cycle software development? Think of it like this — you do not just build a product once and call it a day. You design, build, test, deploy, monitor, improve and repeat. It is a loop, not a line.
In mature ecosystems, product and engineering teams are steeped in this methodology. They build fast, get feedback, iterate and launch again. But in Australia, many startups still fall into the trap of focusing too much on the launch. As a result, products that cannot scale. Features break under user load. Apps that look shiny lack the backend stability to grow.
Capital is fuel, but execution is the engine
A startup might raise $5 million. However, if it burns half of it on bloated teams and unclear product specs, that money disappears fast. Imagine a Melbourne-based fintech startup that just closed a Series A. They have got a brilliant idea. They hire a few developers and designers, build a slick front-end, and launch a beta.
But here is where cracks start to show:
- No proper QA process leads to bugs during tax season, so users start dropping.
- Deployment is manual. A dev has to SSH into a server every time.
- No monitoring tools, so they do not catch issues until it is too late.
- No user feedback loop, so feature development is based on guesswork.
Six months later, the retention decreases; new investments are on hold and the entrepreneur founders are at zero point.
That is in comparison to a full-cycle startup:
- They begin with user research and map out core journeys.
- Their devs work in sprints, test automatically and deploy with CI/CD pipelines.
- They integrate user behaviour tools from day one.
- Every bug, user complaint and crash is tracked and logged.
- Most importantly, they adapt fast.
Such an approach turns $5 million into a scalable product. And that’s what investors want to see.
What startups and policymakers can do
We cannot magically move Australia closer to Silicon Valley. Even Australia’s AI push comes with some questions. But there are a few things we can do to bridge the gap.
1. Prioritise engineering excellence
An MVP is fine, but it cannot be the ceiling. Founders need to think beyond “get it out the door” and toward “how do we keep improving this product every week?” Investing early in good architecture, test coverage and DevOps pays off.
2. Upskill local talent in full-cycle practices
Australian universities and bootcamps should go beyond teaching coding. Introduce agile process, product discovery and continuous deployment, as well as the utilisation of analytics after launch. Empower the next engineer generation to take the whole lifecycle.
3. Public-private partnerships to support dev infrastructure
Just as the government supports R&D in biotech or energy, why not create funding streams for tools, mentoring, or sandbox environments? These should help Aussie startups build resilient software from day one.
4. Build for global, from day one
One of Australia’s strengths is that our market forces us to think globally. But that only works if the product can scale globally. That means language support, performance optimisation, compliance with overseas standards and a full-cycle approach to development.
Big potential returns look promising
Australia has the talent. We have proven we can build unicorns. Canva, Atlassian, Afterpay, WiseTech — these are the few names to mention. But to repeat that magic at scale, we need more than VC dollars. We need to build smarter.
That means adopting full-cycle development practices that help startups move fast and stay stable. It means treating product and engineering not as a cost, but as a core advantage. So yes, let’s keep fighting for more funding. But let’s also make sure our startups are ready for what comes after the raise.
