{"id":38573,"date":"2023-10-20T14:57:26","date_gmt":"2023-10-20T14:57:26","guid":{"rendered":"http:\/\/startupsmart.test\/2023\/10\/20\/what-tech-entrepreneurs-think-about-the-accc-regulating-startup-acquisitions-startupsmart\/"},"modified":"2023-10-20T14:57:26","modified_gmt":"2023-10-20T14:57:26","slug":"what-tech-entrepreneurs-think-about-the-accc-regulating-startup-acquisitions-startupsmart","status":"publish","type":"post","link":"https:\/\/www.startupsmart.com.au\/uncategorized\/what-tech-entrepreneurs-think-about-the-accc-regulating-startup-acquisitions-startupsmart\/","title":{"rendered":"What tech entrepreneurs think about the ACCC regulating startup acquisitions – StartupSmart"},"content":{"rendered":"
\"OneShift<\/div>\n

The Australian Competition and Consumer Commission may be looking to increase its power to regulate mergers and acquisitions of local tech startups over concerns that market concentration will kill fair competition.<\/p>\n

While an acquisition by a big company is the perfect exit <\/a>for many startups, ACCC chairman Rod Sims is concerned about the harmful effects of\u00a0incumbents like Google swallowing up emerging high-growth startups.<\/p>\n

Speaking to The Australian<\/a>\u00a0Financial Review<\/a><\/em>, Sims said that though his ideas may upset some founders, they\u2019re important considerations to make in ensuring the growing tech sector remains a fair and levelled\u00a0playing field.<\/p>\n

\u201cThe more we get into the tech startup world, the more we may need to broaden our horizons a bit in our thinking, and others may need to as well, like the courts and commentators,” Sims said.<\/p>\n

“We need to take a view on whether this sort of activity is taking out future competition and entrenching the incumbent.<\/p>\n

“Of course we understand that sometimes when a big bank or a big company buys a startup, they can get the ideas and products out to the market more quickly, but if this is taking out a company that looks like a serious future competitor then I think we have to look at it differently.”<\/p>\n

Is collaboration between corporates more important than fair competition for startups?<\/h3>\n

OneShift founder Gen George<\/a> says a $5 million investment from ASX-listed Programmed gave her venture a real fighting chance in the market.<\/p>\n

“It has only added value,” George tells StartupSmart.<\/em><\/p>\n

She says collaboration between incumbents and new players in the market forge great opportunities for innovation.<\/p>\n

It also gives small companies like hers access to critical funding and resources like marketing or legal aid to help them achieve strong growth.<\/p>\n

\u201cCorporates don\u2019t only bring cash they can also bring infrastructure that can actually assist your business,\u201d she says.<\/p>\n

\u201cIt would be a shame to shut off startups from corporates and corporates from startups.\u201d<\/p>\n

George notes that market concentration is a problem that affects all industries and that the startup sector is not mature enough yet for this issue to be a regulatory concern.<\/p>\n

\u201cIt could happen anywhere. What if Woolworths buys Coles? The ACCC would never let that happen,\u201d she says.<\/p>\n

\u201cThe Australian market for startups and investments is still very young, I don\u2019t think we\u2019ve seen any corporates stepping in that direction yet.<\/p>\n

\u201cWe need to see how the market evolves and maybe in five years start looking at [restrictions].\u201d<\/p>\n

Where the ACCC should focus regulation<\/h3>\n

Vinomofo co-founder Andre Eikmeier<\/a> says tighter regulation is rarely the best solution for startups.<\/p>\n

\u201cIf founders want to sell what they’ve built to a major player, then they shouldn’t be restricted from doing that on account of anti-competitive legislation,\u201d he tells StartupSmart.<\/em><\/p>\n

\u201cThe concerns that this would be taking out a potential future competitor are moot in my mind if the founders or owners have made the decision to sell themselves.\u201d<\/p>\n

Instead of blanket restrictions on what big companies can or can\u2019t acquire, Eikmeier says the ACCC should focus its efforts on regulating what big companies do after they\u2019ve acquired startups.<\/p>\n

\u201cAfter all, that’s really what we’re trying to prevent through restricting anti-competitive behaviour, right? That and the way suppliers are treated?\u201d he says.<\/p>\n

Follow StartupSmart on<\/em>\u00a0Facebook<\/a>,<\/em>\u00a0Twitter<\/a>,\u00a0LinkedIn<\/a>\u00a0and iTunes<\/a>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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