Australia enters 2026 with a strong innovation sector that is ripe for continued growth and investment. However, the right support and momentum will be critical.

Dealroom.co ranks Australia as the global leader in the efficiency creation of unicorns, generating 1.22 unicorns for every one billion dollars of venture capital invested. On a per-dollar basis, no other country comes close.

This efficiency is not a coincidence. It reflects how Australian founders operate compared with their global counterparts.

The relatively small size of the Australian market means that, to defend and grow the nationʼs innovation leadership, founders and investors must think differently — and globally — from day one.

When international investors talk about Australian founders, the same phrases are often repeated: determined, resilient, and able to cut through the noise to deliver high-quality outcomes with capital efficiency. These traits are clear competitive advantages and represent a significant opportunity for both investors and the Australian economy.

Our emerging global names prove the point. Cover Genius has scaled its Sydney-based insurtech platform to protect more than 30 million customers worldwide. SiteMinder, a now-exited unicorn, built a category leading hotel commerce platform used by more than 50,000 properties globally.

Despite these successes, Australia remains underfunded by global standards. Cut Through Venture Q3 2025 data shows total funding activity continues to lag behind other developed tech markets. Yet the quality of ideas, talent and products emerging from Australia continues to outperform relative to the capital invested.

This is a powerful signal. It suggests Australiaʼs tech ecosystem has not yet reached its ceiling — in fact, it has barely scratched the surface of what it could deliver with a deeper capital base, more global partnerships and a stronger pipeline of founders building with scale in mind.

There are also clear opportunities for the $4.5 trillion Australian superannuation pool to inject more funding into the innovation ecosystem.

A recent report from Mandala, commissioned by the Australian Investment Council, found that while private equity and venture capital have delivered returns 10.8 percentage points higher than listed equities, Australian super funds allocate just 4.4% to the sector, compared with 14% among global pension funds.

The fundamentals are already in place. Australia has more than 1,000 AI start-ups, rapid growth in climate and clean technology, a maturing fintech ecosystem and data centre investment expected to reach 2% of GDP by 2029, driven by AI workloads and cloud migration.

Software licence exports have risen tenfold over the past decade to reach $8 billion. The technical talent, engineering depth and track record already exist. What we need next is acceleration.

Funding competition is also intensifying. India, ASEAN and the Middle East are attracting major global funds and building fast-moving ecosystems designed to capture the next wave of unicorns. Australia cannot afford to be passive.

If youʼre in the market for funding, whether venture capital or debt, one question will keep arising: how defensible is your company to external factors outside of your control?

It is crucial to demonstrate revenue resilience, adaptability to industry and competitor shifts, and indispensability to your customer base.

While the innovation story is strong, the risk heading into 2026 is complacency. Ecosystems that slow down lose talent, capital and opportunity to faster-moving markets. The global race for AI skills, for example, is already intense. If AI adoption stalls, Australia risks losing its edge.

The Australian governmentʼs recent release of the National AI Plan provides some optimism, particularly in its focus on ensuring Australians benefit economically from AI while also addressing emerging risks.

However, Australiaʼs innovation story must extend beyond AI alone. If Australia wants to retain its lead in unicorn efficiency, it needs financial infrastructure that moves at the same speed as its founders. High-growth companies require banks that understand venture timelines, international expansion, burn management and the realities of building across multiple markets.

The ability to connect local founders with global capital, cross-border payment infrastructure and institutional finance is becoming a key differentiator in the scale-up journey.

Australia has already shown it can outperform with limited capital. The next phase is about pairing that efficiency with greater ambition, deeper global connectivity and a support system built for scale.

If we get it right, Australia will not just continue to punch above its weight — it will retain and grow its global leadership position.