Kate Cornick has been CEO of LaunchVic, which leads the development of Victoria’s startup ecosystem, since late 2016. She has previously worked in the university and private sectors, and as a staffer, and holds a PhD in telecommunications engineering. She spoke to The Mandarin about the work of LaunchVic — and particularly CivVic Labs, an accelerator program bringing government and startups together to solve public sector problems.
LaunchVic was created three years ago as part of the Victorian government’s drive to grow the state’s digital economy — and, of course, one-up Sydney.
“Our job is to curate the startup ecosystem and support its growth”, explains Cornick at the Victorian Innovation Hub, housed in a refurbished Docklands goods shed.
The typical business LaunchVic works with is a small tech company with big potential — they might have two staff at present, but could one day employ hundreds or even thousands of people.
“In Victoria, we have about 2700 of these companies, most of them are very early stage, but their potential is huge.”
Melbourne’s startup scene is fast-growing, despite still lagging behind Sydney. But it’s gaining a reputation — around one in five of the city’s startups are in health and wellness and the state currently has nine ‘unicorns’ — startups valued at over $1 billion — including brands such as seek.com.au, realestate.com.au, and Envato.
“We are currently the fifth-fastest growing startup ecosystem in the world. The value of our ecosystem in economic terms has grown 40% in the past year alone. So we’re really doing some amazing things.”
Building the bridge
Startups tend to find it difficult to break into government procurement systems, however. Overcoming this problem would allow the public sector play a direct role in further strengthening Victoria’s digital economy, says Cornick. That’s the idea behind CivVic Labs.
“The startup sector was coming to us and saying, procurement is a real challenge. In an environment in Australia where we have risk averse corporates and risk averse governments, it’s really hard for startups to get those first customers, to then go and launch overseas and grow a viable business.
“We want these startups doing that because we want their headquarters remaining in Melbourne, we want to grow jobs locally, we want people to be servicing global markets from Melbourne.
“At the same time the public sector innovation branch in the Department of Premier and Cabinet approached us and said we’re thinking about new ways of procuring and we’re very conscious we can’t procure from startups because the financial history isn’t there, the procurement processes aren’t there.“
So CivVic was born. The first program of its kind in Australia, the aim is to bring both sides together in a low-risk environment. The first step is for government departments and agencies to define a public sector challenge that would benefit from innovative thinking or new technologies. Startups then propose solutions through a competitive online process, and are assessed by how well their idea addresses the challenge and their capacity to deliver it in collaboration with their public sector partner. Startups are admitted to the four-month program where they work directly with the agency to design and develop a prototype, supported with funding, mentors, and resources. Startups that complete the program may be procured by the challenge owner to implement the solution.
“Effectively we get government, who have great procurement opportunities, and maybe they’re thinking of a traditional procurement, but maybe they’re not exactly sure what the solution is, or they might be interested to know what new technologies are coming through to help with a particular procurement.
“… You’ve got two cohorts, public servants and startups, that don’t speak the same language, don’t have the same background, don’t have the same goals at face value. But they may have the same problem they’re trying to solve.”
One entity taking part in CivVic’s first round is St Vincent’s Hospital, which wants to reduce hospital-acquired conditions. One in every nine patients who go into hospital in Australia suffers a complication. If they stay in overnight, the figure rises to one in four — and that costs government billions of dollars per year.
“They go in to have hip surgery and they come out with an infection, and end up staying longer. So how can you get tools in place to predict where these conditions might be occurring so then you can think about preventing them. This is not something your typical tech solution is necessarily going to be viable for.
“St Vincent’s came on board as a challenge owner and broadcast this challenge through CivVic labs to the startup community. We had a number of startups respond to that challenge with a whole host of ideas. St Vincent’s were able to select three to go through a pre-accelerator, where each startup was given $5000 to go and refine that proposal over a three week period.
“That gave St Vincent’s the opportunity to see how nimble these startups were, how they responded to the challenge, and the opportunities resulting from that. At the end of that, they chose one startup to go through a 12-week accelerator program. That accelerator program is running right now, and we’ve got four startups selected to be part of it.”
Other challenges currently running include one commissioned by the Department of Transport to better understand how people use public transit. The department is now working with startup Envision Systems to develop sensor monitoring through the network. Michelle Thomas, director of user insights and analytics at DoT, said CivVic Labs is giving agencies the chance to “explore the talent in our startup ecosystem and test inventive solutions without taking a huge initial risk.”
“The startup we’re working with, Envision Systems, has impressed us with their commitment to the project,” Cornick says, “and I think both sides are learning a lot from one another. It’s great to see these startups being exposed to a new world of opportunities and us within the public sector being supported in the application of more progressive and agile startup thinking.”
Western Health is also working with WeGuide to capture and report patient data to improve healthcare delivery. During the CivVic process, Western Health identified an additional challenge that could be solved through chatbot technology, so artificial intelligence specialists Random Potential are exploring patient-reported experience measures in real-time. Sandy Buchanan, general manager at WeGuide, said CivVic Labs was a fantastic inroad into Victoria’s thriving healthcare sector.
“CivVic Labs has been an amazing side door entry to the public hospital system, and has provided invaluable exposure to the public health sector.”
Buchanan was also surprised at the appetite for innovation within the public health system, saying CivVic Labs has “demystified the government process”.
“Usually the government procurement process means putting forward a solution that can be rolled out across the whole state — this process allows us to test a proof of concept and then explore how we could build it out across the system. This way of thinking is so different from how the public sector usually works, and it’s really exciting to be at the forefront of this revolution.”
What do we get out of it?
The benefit for government is being able to see “a whole host of technologies they would not typically have had access to” if they went out to a standard IT consultant or some other form of traditional procurement, explains Cornick. This can lead to better solutions at lower cost.
“The other benefit to government is we put the person who owns the challenge through the accelerator alongside the startup. That engenders a startup culture inside government. We start to see almost a professional development. We know the startup sector has something very special, at LaunchVic we see that day in day out, but how do we engender that nimbleness and innovation inside government? So it’s a great professional development opportunity to sit alongside the startup.
“For the startup, they get to understand government processes. They’ve often never dealt with government, they don’t understand the burden that comes with monitoring and managing public funds. There’s a real reason why government is cumbersome — we have a huge responsibility on our shoulders and we have processes that reflect that. But that’s not understood well by startups.”
Cornick urges innovation-hungry public servants to reach out to LaunchVic.
“I’d encourage any public servant who has ambitions to innovate to absolutely come and get involved because here you’ve got a great environment where you can learn from some of the best innovators in our state.”
And you might even help Melbourne overtake Sydney.
Don’t miss out on our special event on bringing the worlds of design and government together. Design for Public Sector Leaders has been devised and will be facilitated by CivVic Lab’s inaugural Managing Director, Dr Mathan Ratinam.
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