Brian Schmidt says there is a pot of money to pay for innovation

There is more than enough money in superannuation funds to properly invest in start-ups and entrepreneurship.

Australian National University vice-chancellor Brian Schmidt addresses The Australian’s Creative Country conference in Melbourne yesterday. Picture: Aaron Francis

There is more than enough money in Australia’s multi-trillion-dollar superannuation funds to invest in start-ups and entrepreneurship, but it is being deployed wrong, says Australian ­National University vice-chancellor Brian Schmidt.

Professor Schmidt told The Australian’s Creative Country conference yesterday there would always be some “brain trade” ­between countries but more worrying was the ones who stayed and still could not build the busi­nesses they set out to establish. “More worrisome is when we do get people who do stay and start things; they inevitably feel that pull to go overseas and get money,” Professor Schmidt said.

“There’s plenty of money in Australia, there (will soon be) $6 trillion in superannuation funds. We have to build up a whole culture, an ecosystem, which ­allows people to raise billions of dollars to fund these global enterprises, because at the end if you are not in that global scale you are going to get eaten alive or ripped to pieces.

“We do have the pot of money; we are not very good at using it. The problem is money is not ­deployed in that entrepreneurial system. Part of the reason for that is that the returns are not very good yet.”

The Nobel laureate said there was a tendency in Australia to want universities to become more like businesses even though they were separate beasts, but he ­implored the two to come toge­ther. Instead of working at cross-purposes, an alignment would benefit the state of business and ­investment in Australia.

“I think it is really important to understand how we collaborate but we also have to understand that universities do things differently and we have a different role in the ecosystem. In this country we tend to want univer­sities to ­behave like businesses. I don’t think anyone is arguing businesses should be more like universities.”

Professor Schmidt said he “speaks for all vice-chancellors” when he reached out to other sectors for co-operation. “Get to know us better, whether you are government or business,” he said. “We think that we have certain things that we are under-utilising.”

Professor Schmidt, who has backed some form of university fee deregulation to boost the quality of courses, said it was still impor­tant to keep education affordable for the good of the country.

He railed against the Danish system where all citizens paid tax but the bottom half of income earners scarcely attended university. “They’re paying for the rich to get educated. I think we do it much better in Australia,” he said. “You have got to take some risks in life. I’ve got a billion-dollar organisation to run. I haven’t ­really drunk the Kool-Aid in the normal structures of Australian universities.

“It is certainly important that it is affordable; you want equity. We really do believe in equity. But people must get good value for the money they spend. You can make education cheap, but if it is crappy it is not good value.”

In a passing swipe at Silicon Valley, Professor Schmidt said Australia, if it could offer the ­opportunity to invest, already had the lifestyle. “If you’ve actually ever been to Mountain View, California, it ain’t that exciting.”