The IR&DB studied 25 firms who set up headquarters overseas or transferred their IP to an overseas company.

The study concluded that

  • Australia develops novel products, processes and services that are marketable on a global scale.

  • Offshore sale or the establishment of a foreign holding company should be viewed as a positive step for innovative Australian SMEs and Australia.

Benefits Included

Once Entrepeneurs sold the business, he often reinvests his capital in another Australain Business increasing the skill base and networks as a result of Global Experience. In some cases, firms have become global R&D centres for their new partner/owner, capitalising on Australia’s low costs and strong skills base. Firms found that going overseas led to the expansion of their core R&D operations in Australia, with associated growth in local employment, turnover and wealth.

Reasons for going global included:-

  • participation in international markets seen as essential to expand your business

  • access larger markets to increase sales and revenue accessing overseas markets often requires a local sales and management team. Using the established sales and distribution infrastructure and networks of an overseas firm is a fast and effective way for Australian firms to make an impact on overseas markets.

  • Most firms reported better access to capital, technical support, and skilled local sales staff.

  • Gain regulatory approval in offshore markets

  • Overseas markets generally want to buy from local suppliers. Comfort of knowledge of service.

  • Venture capital available overseas at higher valuations. Generally they require a holding company in the country, which is providing the finance.

  • Venture Capital Markets include UK, USA, Europe and ASIA


Twenty-five innovative SMEs were interviewed across the eastern States. The majority were in metropolitan areas, and two were from regional areas. Firms were primarily from the IT, biotechnology and medical sectors, with some from the manufacturing sector. In addition, five venture capital or investment firms were interviewed to provide a financiers’ perspective on the issue.