Australian universities and research institutions have recorded a bumper year turning research into commercial products and startup businesses, despite cuts to government commercialisation funding.
New figures from Knowledge Commercialisation Australasia (KCA) show Australian research organisations generated $336 million in commercialisation revenue in 2025, up 39% on the previous year.
The sector also created 102 new companies and secured 766 licensing and partnership agreements, up 25%.
The figures come as the federal government redirects more than $800 million in uncommitted funding from Australia’s Economic Accelerator and pauses new applications to the Industry Growth Program.
Australian inventions building overseas companies
Conry Tech co-founder Sam Ringwaldt said Australia was good at developing new technologies but struggled to get them into production.
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“Australia’s competitive advantage is our ability to do research and development,” Ringwaldt told SmartCompany.
His company has spent six years developing an air conditioning system that he says could reduce energy consumption by about 70%.
Conry Tech has completed a prototype and is seeking capital to establish manufacturing operations ahead of a planned commercial launch in 2028.
Ringwaldt said the company applied for $5 million through the Industry Growth Program late last year but was still awaiting a decision.
“We’re left in this like, no man’s land of no capital,” he said.
Ringwaldt said there was a particular funding shortage for businesses seeking between $2 million and $10 million.
He has been travelling to Asia and the United States seeking investment, which may come with conditions requiring Conry Tech to relocate overseas.
Ringwaldt has seen this happen before. His previous refrigeration technology business, Turbocor, relocated to Canada after securing $26 million in Canadian government support.
“We took 24 families from here in Australia to Montreal,” he said.
Ringwaldt said the business subsequently generated around $8 billion in equipment sales and supported thousands of jobs in Canada.
Local manufacturing in the balance
Sydney startup Refilled has also been caught up in the funding freeze.
Founded by Ryan Elson, the Sydney startup develops beverage dispensing machines that allow customers to refill reusable bottles rather than purchase single-use drinks.
Elson said Refilled spent six months preparing an application for up to $5 million in matched funding through the Industry Growth Program to expand its Australian manufacturing operations.
The application involved hundreds of hours of work across his seven-person team and an external grant writer.
However, around a month after submitting the application, the government announced the program would be paused.
“This is the third time we’ve invested time and energy into trying to get some sort of government support to actually build out products here in Australia,” Elson told SmartCompany.
Refilled had previously been unsuccessful in applications for an MVP grant and an Accelerating Commercialisation grant.
Elson said the latest setback had forced the company to consider manufacturing overseas.
“We’re left with no alternative but to start looking overseas and manufacturing offshore,” he said.
Calls to bridge the funding gap
Both founders said Australia’s R&D Tax Incentive had worked well, but left a funding gap for businesses ready to manufacture.
Ringwaldt said government investment should recognise the broader longterm economic benefits of supporting emerging manufacturers, including factories, skilled jobs and intellectual property.
“If I build a factory here, and I buy equipment here, and I procure stuff, and I build expertise here, whether or not my company succeeds, all those capital assets are now in the country,” he said.
Elson called for faster grant assessments and greater collaboration between government investment bodies and venture capital firms.
“If you’re going to run a grant program and have companies submit 30-40-page-long proposals, actually resource those teams properly so they don’t take 12 months to get back to you,” he said.
Ringwaldt warned Australia risked developing promising technologies only to lose the commercial benefits to other countries.
“Retain the brains in Australia,” he said.
Government responds to funding concerns
A Department of Industry, Science and Resources (DISR) spokesperson defended the government’s support for startups. “The Australian Government recognises the importance of start-ups to our economic growth, productivity and national resilience,” the spokesperson said.
The spokesperson said the government had established a framework of support spanning research and development, commercialisation, skills, access to capital and international markets.
The government is considering options to redesign the Industry Growth Program, which has delivered more than $200 million in matched grants to small and medium businesses.
Applications submitted before the program was paused are continuing through the assessment process, with decisions expected by the end of 2026.