The NSW Government will establish a new science and innovation fund to coordinate strategic investment, deliver on government priorities and help turn the state’s research strengths into new businesses.
Announced by Treasurer Daniel Mookhey at the Sydney Investment Summit, the fund will bring together government, universities, researchers and investors as part of a more coordinated approach to innovation and economic growth.
The $150 million fund will initially co-invest with NSW public universities before expanding to support other organisations across the innovation ecosystem, helping promising research and programs move from the laboratory to the market.
The fund is scheduled to begin operating on 1 July 2027.
A new research innovation framework will also:
- coordinate NSW Government equity holdings to ensure investments are managed strategically;
- strengthen capability within NSW Health to develop innovative practices that support an effective and efficient health system; and
- bring together the wider health and medical research ecosystem, including independent, privately and charitably funded institutes, to share expertise and infrastructure and better coordinate research efforts.
NSW already has major universities, hospitals and medical research institutes, as well as government-backed capabilities in areas including quantum computing, advanced manufacturing and RNA technology.
The new fund and framework are intended to better coordinate these strengths and help NSW innovators attract private investment, scale locally and build globally competitive businesses.
The establishment of the framework responds to the independent Pounder Review of the state’s technology and innovation ecosystem.
The Review found:
- NSW generates more technology unicorn companies than any other Australian state;
- NSW secured 57 per cent of all venture capital investment in Australia between 2000 and 2024, despite accounting for 31 per cent of national GDP;
- between 2000 and 2024, NSW attracted US$15 billion, or 57 per cent, of all venture capital investment in Australia – around twice as much as Victoria, the next nearest state;
- innovative companies in NSW generate $39 billion in Gross Value Add per year, despite accounting for just 1.8 per cent of companies in the economy; and
- innovative businesses employ around 136,000 people across NSW, more than mining and agriculture combined, and pay between 9 and 30 per cent more than comparable businesses in the same industries.
The Review also found NSW has an opportunity to strengthen the commercialisation pipeline for its research capabilities, particularly in deep tech, biomedical science and environmental science.
In response to the Review, the Government developed the NSW Innovation Blueprint 2035, a 10-year plan aimed at strengthening NSW’s position as a major innovation economy.
A key action of the Blueprint is adopting a more strategic approach to funding, including improving access to capital and supporting innovators at different stages of growth through measures such as co-investment.
The Blueprint identifies four strategic goals:
- scaling and retaining globally competitive innovative businesses and industries in NSW;
- growing jobs and commercialisation through innovative businesses and industries;
- increasing diversity across the NSW innovation ecosystem; and
- using innovation to address major NSW challenges and government priorities.
The new fund and framework are intended to help close the commercialisation gap by creating stronger links between researchers, government, industry and investors.
NSW Treasury, Investment NSW and the NSW Chief Scientist and Engineer will work with NSW public universities to develop the fund and its governance settings ahead of an initial investment round planned for 2027.
Details including individual investment amounts, co-investment arrangements and application processes have not yet been announced.
Treasurer Daniel Mookhey said:
“Four years of budget discipline have strengthened the state’s capacity to make strategic investments in the industries that will drive our future economy.
“For generations, people have come to NSW with an idea, an ambition and the determination to build something better.
“Today, those people are working in our universities, hospitals, laboratories and startups. They are developing new treatments, new technologies and new solutions to challenges faced around the world.
“The research innovation framework will bring those strengths together so more NSW ideas become growing businesses, better services and well-paid jobs.”
Minister for Innovation, Science and Technology Anoulack Chanthivong said:
“The Pounder Review confirmed that NSW punches well above its economic weight in innovation, research and venture capital.
“The NSW Innovation Blueprint set out our long-term vision to make NSW the best place to innovate, and the Research Innovation Framework is a key step in delivering that vision by helping more research move from the laboratory to the marketplace.
“Innovation policy is growth policy. Every discovery commercialised here means more investment, more jobs and more of the economic value created in NSW staying in NSW.”
Minister for Skills, TAFE and Tertiary Education Steve Whan said:
“The innovation fund will help researchers bridge the difficult gap between a breakthrough in the laboratory and a product ready for the market.
“When NSW researchers change the world, we want the resulting companies, jobs and manufacturing opportunities to be created here, enabling new opportunities for people to upskill and build rewarding careers in emerging industries.
“This will make it easier for universities to work with government, partner with industry and connect promising ideas with the investment they need.”
The announcement was also welcomed by leaders from NSW universities.
University of Technology Sydney Vice-Chancellor Professor Andrew Parfitt said:
“This investment recognises the vital role universities play in driving innovation and will help strengthen pathways for translating research into new industries, jobs and opportunities for NSW.”
Macquarie University Vice-Chancellor Professor S. Bruce Dowton said:
“Macquarie University welcomes the NSW Government’s commitment to strengthening the state’s innovation ecosystem through the proposed innovation investment fund.”
UNSW Chancellor Warwick Negus AM said:
“Universities are engines of discovery, economic growth and innovation.
“As Australia’s leading entrepreneurial university, UNSW welcomes strategic investment that will create new opportunities for research commercialisation and support new enterprise across the state.”
University of Sydney Vice-Chancellor Mark Scott said:
“At the University of Sydney, leadership for good means ensuring great ideas do not stop at the laboratory door. This fund will help turn NSW research into better treatments, new technologies, growing companies and skilled jobs.
“This is an opportunity to build more than a new fund, it is an opportunity to build a more connected and ambitious innovation system for NSW.”
University of Wollongong Vice-Chancellor Professor G.Q. Max Lu AO said:
“NSW has outstanding universities, researchers, entrepreneurs and companies.
“This Fund recognises that when government, universities and industry work together, more great ideas can become new products, globally competitive businesses and highly skilled jobs.”
Western Sydney University Vice-Chancellor Distinguished Professor George Williams AO said:
“As pioneers in innovation support in Western Sydney, we welcome this commitment.
“Through Launchpad, our tech start-up incubator, we connect students, researchers and entrepreneurs to turn ideas into businesses and growth industries.”
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