If ever there has been a trend that COVID-19 has exacerbated, it is that the risk of starting your SME is even greater if this business does not fit the following categories
Has a tilt towards eCommerce or person-less technology
If the good or service is in anyway discretionary
If you had used material amounts of debt or external capital to grow the business
Conversely, it has created a weird environment where typical office workers are saving records amount of their salary, technology companies are valued a unprecedented multiples and those that loaded up in equities or real estate get even further ahead
Of course, this trend will not continue forever... but how can we buck this trend??
In Australia, I think the most important takeaways are: 1) we need to bolster our technology scene (beyond just talking about Atlassian/Afterpay) 2) SME's should continue to get tax-support and 3) property developers who have made "super profits" in 2020/21 should be required to increase their requirement in affordable homes (resi developments) or public infrastructure (commercial developments) going forward.
Whilst these opinions may sound rather left-leaning for our readers. This does not need to be case. In fact, for anyone that has either travelled or worked in technology or real estate space knows the following to be true:
Smart Aussie tech has been funded overseas until the recent arrival of Australian VC (e.g. SquarePeg, Blackbird, Airtree, Rampersand, Skip & Grok)
Small businesses have complicated taxes (e.g. payroll tax or limited write-offs) which could easily be improved
Time and money wasted in planning/zoning is often a far bigger killer of real estate deals than whether affordable/social housing is included
So - in short, it is not all doom and gloom. We just need to ensure this ongoing environment created by a once-in-a-lifetime pandemic does not lead to us losing sight of the things that make Australia great; small business and being a new world country.
The cashed-up office worker who bought Tesla shares or a Surry Hills terrace might be a poster of who did well this pandemic, however, it won't be the cornerstone of future growth.
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