Where Should Australian Companies Find Investment Capital?

Australia has a large number of successful IT companies, Wotif, Seek, realestate.com.au are global household names, and if you can include some biotechnology companies such as ResMed, Cochlear, and iSoft, the list is even bigger.

However, because Australia remains as a small capital market for IT industries, and sometimes, good opportunities have been missed '" some Australian technology companies could receive much better support in overseas markets, here are some options for you to consider.

Start off with Australian Venture Capital providers '" it's a good place to start, majority of the Australian VCs do invest in IT sectors, mainly e-commerce, IT, Communications. However, they are relatively unfamiliar with certain sectors compared to overseas investors such as: Semiconductors industry, nanotechnology even Social Media, all remain to be relatively new concept for Aussie VCs.

Listing, maybe an option '" however, ASX is not the best market to list IT companies '" they do not receive the same valuation treatment as in Asia, Europe and North America. The advantage is, however, ASX is quite an easy market to list and relatively cheap. Once you are listed, you can apply for dual listing.

IT & Telecommunications companies listed on ASX have the lowest average P/E compared to their counterparts in US and Europe for instance.

Stepping into Asia? Good idea, Asian markets are very tech-savvy, and they are global leaders in many areas including semiconductors, telecommunications hardware, software developments. Many Australian applications could find much brighter future in Asia. You can consider Singapore and Hong Kong as starting point. If you are involved in hardware or semiconductor related products, then Taiwan is also worth consideration. You can also contact Asian Venture Capital firms.

North Americans love technologies, which is why they have Nasdaq! US can be a difficult market, as there are so much happening every day, and you have to compete with other deals.

Why not considering Canada as an entry point for North American market? We have seen some Australian med-technology companies such as Promedicus expanding into Canada first and use that as a base to jump into US.

You can also consider listing on Canadian Stock Exchange, including a Venture Stock Exchange which supports a lot of technology companies. Once you are listed there, and if you have made a good progress, transition into the Big Nasdaq board will be relatively easy.