John O’Brien is the Managing Director of Australian CleanTech, and the organiser of the annual Australian Technologies Competition. He spoke to William Poole.
AMT: Firstly, tell us about this year’s Australian Technologies Competition.
John O’Brien: Certainly. We’re into the fifth year of the Competition, and the aim is that we find, mentor and celebrate the best emerging technology companies from around Australia. There are two benefits: growing emerging technology businesses, but also finding solutions for industry to help them be more efficient and competitive. This year we’ve got the categories of Food & Agritech, Energy Technologies, Advanced Manufacturing, Mining Tech and the Built Environment. We’ve also got prizes for Global Development, for solutions for the developing world, and one for the best region in Australia that supports technology.
In terms of the Advanced Manufacturing category, the focus is “How do we help the manufacturing industry become more efficient and more competitive?” One previous winner was BluGlass, a Sydney company which designed a new way of manufacturing light emitting diode (LED) cells that uses less energy, operates at lower temperature, is cheaper and delivers better-quality LED cells. They’re commercialising that right now. And last year’s winner was Rheology Solutions, whose technology allowed real-time online measurement of the consistency of liquid manufacturing processes, which is very good for things like shampoos, where the texture of the liquid is very important. Their technology allows manufacturers to have better quality control and less wastage.
AMT: Is there a strong focus on Australian content?
JO’B: Absolutely. The entry requirements of the competition are that you have to be an Australian company, you have to be an SME with less than 100 employees, and you have to own or have beneficial use of the IP used in your technology. So it’s not about distributors of international technology, it’s technology that is effectively owned in Australia by that company.
AMT: What do people stand to win?
JO’B: Well, sometimes award programs have a big fat cheque at the end, but not this one. We believe we offer something far more valuable – and the companies that have been through it believe this as well. So last year we had 220-odd entries, 36 of them became semi-finalists, and each of them went through the Business Accelerator program, which gave them a whole lot of mentoring, a whole lot of connections, and a whole lot of advice from industry about their technologies and how best to get to market. And also exposure to Chinese,Korean and Singaporean partners, who came to Australia to meet them. The winners also get financial benefits if they come on a trade mission at the end of the year.
But it’s more about connections with partners, customers and investors, and the exposure of being judged the best in Australia. To be honest, it is really a mentoring program in disguise. There are finalists, there are winners, but it’s actually more about how we help those 36 companies and make all of them into successes. With the mentoring, when we have three days in Sydney with all of those 36 together, there are really two games. One is the game of the competition and how you can do well in that, but the far more important game is how we help you be successful in your business. Regardless of whether you win the competition, if you have a successful business, we’ve done our job.
AMT: The competition aside, what is Australian CleanTech and what are its main areas of activity?
JO’B: We’re a research and consulting business. We work for growing technology companies, and for investors looking to invest into Australia. And we do a lot of work for governments at local, state and national level. We’ve also done some work for the Korean and Chinese governments. We run networking events around the country and publish a couple of stock market indices.
It’s all vaguely around environmental technologies, but technologies that have economic benefits as well. Environmental benefits are just a nice side-effect to developing good technologies that make sense and make their investors money.
One project we did a couple of years ago was with the Vic government, where we worked with a lot of SME manufacturers… AMTIL-type members… smart guys doing smart manufacturing. And we educated them on what the trends were and where the opportunities existed. More importantly, we introduced them to Victorian-based clean-tech companies who needed a manufacturer. A lot of those guys were exposed to the auto industry so were looking for different clients, and there was real value to the emerging technology companies to work with an experienced manufacturer on things like design-for-manufacture and Lean manufacturing and supply chain thinking. Often an emerging tech company just doesn’t have that depth of experience, so there were real benefits on both sides. A lot of companies out there would never call themselves clean-tech and probably never will, but will be making stuff that might be called clean-tech.
AMT: What’s your professional background and how did you end up working in this field?
JO’B: I started off as an engineer, I worked on oilrigs and designed buildings and managed a gas network for a while. I was at Origin Energy for nine years, and the last six of those I was doing activities not dissimilar to now – I was doing M&A and strategy and investment-type stuff. I got sick of having a boss, so I thought I’d give it a go on my own. That was back in 2007, and we’re still in business, so that’s good.
AMT: Renewable energy and other clean technologies are often cited as growth areas for manufacturers. Where do the big opportunities lie over the next five to ten years?
JO’B: Well some of these technologies, particularly renewable energy, often get stuck in the politics of the world, which is unfortunate but that’s the way it is. But with a lot of the stuff we do the politics is to some extent irrelevant because of global trends: the politicians will catch up eventually.
So in terms of big areas of growth, renewable energy is growing incredibly fast. To date Australia hasn’t done a great deal of manufacturing in that space; they’ve done a lot of importing. But it was good to see IXL pick up a big contract to make frames for solar panels on the big AGL project.
Other growth areas from a market point of view are things like green-building technologies, either for new buildings or retro-fit. That’s a very quick-growing market. Energy and water efficiency devices: as energy and water become more expensive, people are actively looking for products that make sense. And energy storage is a very interesting area, with a lot of very big global companies spending a lot of money. Whether there’s a local manufacturing angle to that, I think there is, I think you can buy battery modules and package them up locally for the local market. Energy storage in the next three or four years is just going to go through the roof, in the same way solar panels have in the last few years.
Electric vehicles have been a long time coming, but they are coming, and there will be a lot of recharging stations. There’s a handful of companies around Australia looking to manufacture recharging stations: Tritium in Brisbane is one. So again, there might be a manufacturing opportunity there as well.
AMT: The carbon price and its subsequent repeal have highlighted the political difficulties in tackling environmental issues. What would you like to see in policy terms to promote clean-tech?
JO’B: Australian politics is really quite strange. I travel a lot in Asia and people just go “What is going on in Australia? The whole world is moving in one direction and you seem to be moving in another.” Again, it is what it is. The politicians seem to have got a bit stuck at the moment.
But from a policy perspective, it can focus too much on technologies being ‘environmental’. In my mind, almost any new technology should be more efficient, use less resources – that’s almost the definition of technology. I would suggest there’s an environmental benefit to any successful technology; it’s really about finding the best technologies, creating jobs and driving investment and trade. Don’t call it ‘clean-tech’ if that causes problems, don’t call it ‘environmental’. It’s just backing good technology that drives efficiency and enables new companies to grow and older industries to become more efficient.
There’s some reasonable policy support for that in general. I see some specific things that could be done that could help this sector a little bit more. One of those is that a lot of technologies we see, especially through the competition, are born global – they may never have a customer in Australia. BluGlass, for instance: there’s no LED manufacturing in Australia, so all their customers will be international. There’s quite a few of those type of companies around that actually end up going into international markets earlier in their lifecycle than traditional industries. A traditional exporter – whether it’s a manufacturer or a sheep-producer or a winemaker – will grow to a reasonable size and then think about going into international markets, whereas a lot of high-tech companies go very early in the piece. Some specific policies and assistance around that would help them achieve growth earlier.
AMT: Looking overseas, which countries are really taking the lead in terms of clean technology, and what can we learn from them?
JO’B: There’s plenty going in the US and Europe. In our region, which is where we concentrate, we work in three countries: China, South Korea and Singapore.
China has a massive desire for the best technologies in the world to fix up their environment. Their environment is a disaster – they’ve done 200 years of industrialisation in 20 years, and 200 years’ worth of pollution. They now need to fix it up, anything from the Beijing smog, to polluted rivers and polluted land. There’s massive demand, massive government support, and massive investor support for the best technologies to help with environmental problems. There are incredibly generous tax regimes for green companies. One Australian company we’ve worked with is currently negotiating a joint venture to establish operations at an industrial park outside of Shanghai and will secure a $3m cheque from the government when it is signed. There’s plenty of risks of course, but plenty of potential.
Korea sees itself as a global high-end manufacturing leader, and is very keen to find the best technologies and access global markets and global supply chains. There’s an interesting route there for Australian companies, to partner with Korean companies. And then there’s Singapore, where the government sees clean-tech as an opportunity for economic development. There’s going to be massive demand through South-East Asia, and they’re providing grants and assistance to help companies relocate there to access that market.
AMT: What advice would you give to Australian manufacturers looking to break into this space?
JO’B: I think there’s a perception that it’s all a bit green and weird and doesn’t have a real market. But I think once manufacturers start understanding what the opportunities are, it’s just: “Well that’s just what we do anyway. We manufacture stuff that is smart and efficient and more productive.”
It’s a huge growing market globally. It’s actually growing pretty quickly in Australia, despite the politics. And these are the technologies of the future. So if your only customers are old industries, you need to start thinking about how you can start manufacturing for these new industries, and get some of that growth for yourself.