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There is no miracle way to create a Silicon Valley-style innovation community in Australia, but there are key ingredients to help it along.

The amount of funds available for investment was key but there also needed to be a cultural shift in the way that start-ups and entrepreneurs were paid, The Australian and Deakin University Business and Law Future Examined series has heard. Namely, this came down to stock options, and at the same time there was a need for the Australian economy to remain open to importing skilled workers.

NAB Ventures general partner Melissa Widner said there had been a tenfold increase in venture capital raisings in Australia over the past decade. More than $2 billion had been made available for venture capital investments across Australia.

In recent years, names such as Atlassian or online design specialist Canva have emerged as the stars of Australia’s technology scene. Atlassian is headquartered in Australia and is listed on Nasdaq.

It has a market capitalisation of nearly $20bn. Canva is privately owned, but its latest investment round gave it a valuation of $1bn.

Ms Widner said the way employees were paid at start-ups is significant.

In the US, new employees were nearly always paid in shares and stock options, which not only gives the employees a stake in the company, it can also help to preserve cash during a vulnerable time for a start-up.

She saw first-hand how this could also change the innovation “ecosystem” of a city.

“I’m from Seattle. And Bill Gates decided to locate Microsoft there, because that’s where he was from.

“And that completely changed the landscape of Seattle.

“It’s because you had a few billionaires, lots of centi-millionaires, hundreds of deci-millionaires and thousands of millionaires, because they got stock options,” Ms Widner said.

“In the US, no matter what job you take at a start-up, you’re getting some kind of equity. So is that start-up becoming the next Facebook or Google?”

Even with the surge in venture capital funds over recent years, start-ups still needed more finance.

Also speaking on the panel, Reinventure co-founder and managing director Simon Cant said immigration presented an opportunity for Australia to attract the right talent.

“To create an environment where you benefit from increasing returns, you need to really open your doors to technologists coming into your market,” Mr Cant said.

Meanwhile, universities or government could play a bigger role in setting the foundations to commercialising talent, whether that was sharing the intellectual property or providing a framework for staff to have a greater role in commercialising talent, he said.

He said CSIRO’s data, science and engineering arm Data61 was overseeing intellectual property licences but faced hurdles in getting access to private capital.

Even so, Australia had made major strides over the past decade when it came to fostering start-ups, Ms Widner said.

“We’ve got innovative people here. We’ve got great education. The R&D tax credit system is wonderful. It provides a great foundation for funding companies,” she said.

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Originally published on The Australian.