STARTUP SECRETS:

HOW AUSTRALIA CAN CREATE

NEW BUSINESSES WITH
FINTECH AND CYBER SECURITY
INDUSTRY COLLABORATION
A report into the outcomes of the inaugural
National Fintech Cyber Security Summit and
opportunities for Australian industry and
government to create startups by fostering
collaboration between the financial services and
cyber security sectors.
PLATINUM SPONSOR

b Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
 CONTENTS

FOREWORD 2
GET INVOLVED WITH AUSTRALIAS NASCENT CYBER SECURITY INDUSTRY 3
EXECUTIVE SUMMARY 4
INTRODUCTION 5
COLLABORATION CALLS: DEVELOPING A CYBER SECURITY INDUSTRY 6
Summit outcomes tackle practical building blocks 7
Startup engagement for corporate gain 10

ESTABLISHING AUSTRALIA AS A REGIONAL FINTECH-CYBER SECURITY

INNOVATION HUB 11
Become startup ready with an innovation program 11
Customers trump funding 13

AUSTRALIAS CYBER SECURITY, FINTECH INNOVATION PLATFORM 15

Financial services driving demand 15
Starting on the right foot 16
Learning by observation: Israel 17

APPLICATIONS WHERE FINTECH AND CYBER SECURITY MEET 18

CONTRIBUTE TO AUSTRALIAS CYBER SECURITY DEVELOPMENT 20
ABOUT THIS REPORT 22
National fintech cyber security summit highlights industry opportunities 23
Summit timing ideal to spur collaboration 23

1
 FOREWORD

Cyber security is the foundation of Startup secrets is a long-overdue, practical guide aimed
at changing the tide of too much reliance on imported
our information economy and is technology and not enough support for our local tech
growing more critical as government startups.
and industry rapidly expand digital Take some time to review how cyber security impacts
initiatives. Australias financial services your organisation and how it is best placed to
get involved with this important turning point for
sector is world-leading in its robustness Australias commercial future.
and adoption of emerging trends
such as mobile payments, cloud
Alastair MacGibbon
computing and data analysis. All this is
Special Adviser to
underpinned by trust in the information the Prime Minister on Cyber Security
that is transmitted through and stored
in digital systems.
Without world-class cyber security trust in our ability
to perform reliable financial transactions will erode,
as will our confidence to develop new products and
services for business and consumers.
When the Prime Minister announced the National
Cyber Security Strategy in April a fundamental aspect
was increasing the collaboration between industry,
research and government agencies. To better respond
to threats and support the growth of the local cyber
security sector. We are a nation of innovators, but too
often our bright ideas are captured and commercialised
by larger companies based overseas. Startup secrets is
a great example of our willingness to work together to
develop an industry to satisfy a growing need for our
economy.

2 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
GET INVOLVED WITH
AUSTRALIAS NASCENT
CYBER SECURITY INDUSTRY

Australia is embarking on an
unprecedented industry building
program. More statistics are not
required to prove to you what we
The final phase will be the launch of the Cyber
Security Innovation Lab where startups and
researchers will work alongside corporates and
government agencies to create and commercialise
new developments in fintech-led cyber security.

already know cyber security is now If your organisation wants to be a part of creating
a new cyber security future for Australia, either as
a mainstream need for every business a creator or consumer of our untapped innovation,
and individual in Australia. then we encourage you to join our program.
Without leaders like you, we cant make this
Despite this requirement, we buy most of what we happen.
need from overseas making us highly dependent
Help us champion this opportunity and lead the
on others for the protection of our most critical
way towards an exciting new industry that will
information. The same way we dont outsource our
contribute to addressing the current and emerging
military to foreign companies, we need to build a
global cyber challenges.
strong information protection industry locally.
Many of those that attended the National Fintech Representatives from CSIROs Data61, Stone & Chalk,
Cyber Security Summit roundtable in May agreed KMPG and the Australia Israel Chamber of Commerce.
we have the talent and collective ability to create a
viable industry; however, we have lacked focus and
prioritisation.
To overcome these hurdles, we have created a
national cyber security innovation program led
by demand from the financial services sector
and aligned to the federal governments recently
announced Cyber Security Growth Centre initiative.
We designed the innovation program in three
phases, the first of which was the May National
Fintech Cyber Security Summit, VIP roundtable and
dinner series.
The next phase which begins with the publishing
of this report is the launch of a National Fintech
Cyber Security Design Challenge. This will bring
together key organisations seeking to collaborate
with tech startups and researchers from across the
country.

3
 EXECUTIVE SUMMARY
Startup secrets: How Australia can create
new businesses with fintech and cyber
security industry collaboration is part of
a national program aimed at maturing
Australias cyber security and fintech
industries to establish a leading hub for
innovation and product development in
the Asia-Pacific region.
The sponsors of this report are establishing the
infrastructure to foster collaboration between industry
and government to turn fintech and cyber security
startups into larger companies capable of selling to,
and supporting, Australias larger corporate customers.
And the companies we create will be globally relevant
for taking on this global problem.
Intended for business and technology leaders in the
financial services industry, corporate ICT, technology
startups, academia, government agencies and research
bodies, this report provides necessary guidance for
collaborating with other supporting organisations for a
wider economic benefit to Australia.
The inaugural National Fintech Cyber Security Summit
held in May was the first stage of a broader program
to establish Australia as a regional hub for fintech
and cyber security collaboration and innovation.
The summit identified next steps for industry
development including courses of action for
expanding government frameworks, real-world
problem solving, structured information sharing,
innovation program bridges, startup co-creation,
executive-level awareness and venture funding.
For phase two, a national fintech and cyber security
design challenge for financial services will be
held. Organisations are now invited to become a
partner and to contribute via collaboration, startup
mentoring and investment.
4 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
Phase three will see the launch of the Cyber Security
Innovation Lab where startups, researchers and
entrepreneurs can work alongside larger corporate
and government organisations to create and
commercialise new ideas in cyber security and
fintech.
Critical success factors for this program will be
largely dependent on four things: the funding
requirements are met for it to be successfully
run; sufficient priority is placed by participants; a
commitment to commercially partner with startups;
and a clear focus on the problems were trying to
address together.
Cyber security impacts every organisation across
all industries and businesses of all sizes can get
involved in this industry development program
as the growing sophistication of threats have not
been solved by the market sufficiently well enough.
Benefits to corporates range from new approaches
to problem solving and better internal innovation
to skills retention, procurement cost savings and a
roadmap to prepare for potential industry disruption
not simply creating more products for the sake
of it.
Australian businesses need to become startup
ready within their own innovation activities. The
summits main call-to-action found a need for more
collaboration where corporates and governments
agencies must look at branching out their own
innovation programs to include startups outside
their organisations, which in turn benefits industry
development.
For many startups working to get a product
or service off the ground, corporates can offer
immediate help by bringing them on board as a
supplier it is a misconception startups are only
interested in funding. Startups are also a good way
for corporates to access innovative approaches to
the cyber security threat landscape.
INTRODUCTION

This report is a guide to the potential

for new cyber security and financial
services technology, research and
industries in Australia resulting from
collaboration between industry,
startups and government agencies.
In May 2016 CSIROs Data611 and Stone & Chalk, in
conjunction with partners KPMG and the Australia-
Israel Chamber of Commerce (AICC), held a one-day
National Fintech Cyber Security Summit. The summits
objective was to provide an opportunity for the fintech
industry to take the lead in cyber security innovation
and to advance industry development through
generating dialogue between research, government,
industry and startups. It also presents an opportunity
to raise awareness of the collaboration opportunities
for the purposes of establishing a fintech cyber security
capability in our region.
This partnership is the first step of a fintech cyber
security innovation program and the summits
objective aligns and supports the Australian
governments cyber security strategy formally
announced by Prime Minister Turnbull in April 20162
by establishing a fintech-led cyber innovation hub
that incubates innovative tech start-ups focused
on addressing current and future cyber security
challenges.
This report seeks to inform decision makers of the
importance of collaboration and support for nurturing
the intersection of local fintech and cyber security
development capabilities, and share practical advice
on how to get involved with industry development.

1
Data61 was born from the merger of NICTA and CSIROs
Digital Productivity business unit.
2
https://www.pm.gov.au/media/2016-04-21/launch-
australias-cyber-security-strategy-sydney

5
 COLLABORATION CALLS:
DEVELOPING A CYBER
SECURITY INDUSTRY

# While there may be pockets of

DEVELOPMENT OF A CYBER SECURITY
INDUSTRY CANNOT BE ACHIEVED BY A
SINGLE ORGANISATION AND MANY FACETS
ARE REQUIRED TO BUILD THIS CAPABILITY IN
AUSTRALIA.
AUSTRALIA MUST START BY BUILDING ON
WHAT IT HAS TO ADDRESS THE SPECTRUM
OF SHORTCOMINGS OF ITS DISPARATE
INDUSTRY CAPABILITY. COLLABORATION IS
IMPERATIVE.
THERE ARE MANY BENEFITS CORPORATES
STAND TO GAIN BY ENGAGING WITH TECH
STARTUPS FROM COST SAVINGS TO
BETTER INTERNAL INNOVATION PROGRAM
OUTCOMES.
STARTUPS CAN HELP CORPORATES RETHINK
APPROACHES TO COMPLEX PROBLEMS AND
ACCESS ENTREPRENEURIAL TALENT THAT
EXISTS OUTSIDE THEIR ORGANISATION AND
BUREAUCRACY.
strong cyber capabilities within
the private and public sectors,
the best way for Australia to
catch up and lead regionally is to
collaborate on value creation.
With both supply and demand-side organisations
helping to create and nurture cyber startups
there is opportunity to collaborate on
commercialisation opportunities high potential
startups and scale-ups in the immediate term and
research organisations for the longer term.
Cyber security doesnt have geographic
boundaries. It is a team sport and we
need to pull together and lift the scale
of our ambitions to create an industry
and work faster. Lets pull together,
aim higher and work faster
Adrian Turner, CEO, Data61

INDUSTRY ALIGNMENT A primary objective of the recently announced

Cyber Security Growth Centre is to accelerate
WITH THE CYBER SECURITY the creation of a vibrant and globally
GROWTH CENTRE competitive, domestic cyber security industry.
The proposed cyber security innovation
programme & design challenge, which is
being developed in collaboration with the
financial services industry, Data61 and Stone
and Chalk strongly supports the Growth
Centres objectives. The Design Challenge will
align with the thematic areas identified by
the community and coordinated by the Cyber
Security Growth Centre.

6 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
 Developing a cyber security industry is not
something which can be achieved by a single
organisation and there are many ingredients
required to build a strong cyber security
capability in Australia for it to become a
leader in the region.
Research and development, startup
commercialisation, government programs, corporate
support and a change to organisational and team
mindsets must come together to form a capable
ecosystem to meet the requirements of buyers.
Australias Chief Scientist, Dr Alan Finkel, who also
attended the summit, concurred cyber security is
a critical, growing field with enormous potential.
Potential that will only be realised with more
commitment, collaboration and innovation.
It is important Australia rises to the challenge and
opportunity that cyber security presents, Finkel
says. If we want to enjoy navigating a free and open
Internet, we need to contribute to preventive health
rather than treatment after the fact. Whether were
Summit outcomes tackle practical
building blocks
If Australia is to develop a cyber security industry
it must start by building on what we have and not
attempt to start over again. The summit addressed
the spectrum of shortcomings of Australias disparate
industry capability.
a business, a government agency, a university or an
individual we all need to ask ourselves, are we doing
enough?
Adrian Turner, CEO of Data61 says Australia needs to
build international linkages as we are citizens of a
networked world. Getting global context back into
Australia will help is to understand where to partner if
others are ahead of the cyber security game.
Industry, government, academia and investors need to
come together to solve this. This is bigger than any one
company we need to work across stakeholder groups,
Turner says.
As a country we underestimate the depth and breadth
of the cyber security issue, and we underestimate the
opportunity to build a new industry. When I speak with
directors of ASX-listed companies the general feedback
is we understand there is an issue, but we are not
properly across it.
Turner says industry development is important for
Australias economy where many small businesses are
looking to deal with global companies that continue to
push more stringent security requirements of partners.
7
 TABLE 1: AUSTRALIA MUST BUILD ON WHAT IS DONE WELL TO DEVELOP A CYBER SECURITY INDUSTRY
COMPONENT ACTION
Expand government Government frameworks for industry
frameworks development are in place, but doing more
with industry is critical.
Real-world problem An industry cant be developed on the side.
solving It must link with real-world problems.
Structured A framed way for sharing intelligence and
information sharing information on good practices, counter
intelligence and trends.
Innovation program Forge links between the startup community
bridge and corporate innovation programs. For many
startups getting their first customer or proof-of-
concept is difficult. Corporates can provide a
way to get there.
R&D and startup The summit was about how to engage with
co-creation startups and co-create products not just
living with whatever is off the shelf.
Executive-level Boards and executive teams need more
awareness education on the importance of better cyber
capability.
Venture funding Australian startups received about $150 million
in venture funding per year compared with a
huge $5 billion in Israel and even more in
the US.
Avoid working There is quite a lot of incrementalism going on
in isolation as opposed to more strategic, deeper capability
development. For example, the banks could
each invest into an industry capability program
to work on common problems.
Skills and career To provide exposure and excitement for a career
development in cyber security more STEM options should be
available before University. Also, opening up
access to Australias defence and intelligence
capability and learning from the Israeli example
where leading technology feeds down from the
military to the education and private sectors.
8 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
SUMMIT OUTCOME
Cyber security policy makers are now better
connected with industry leaders.
Forum for industry professionals to share
common challenges.
Design forums will be run with industry
leaders.
The National Design Challenge will help
surface and connect industry with Australias
top and emerging fintech cyber security
start-ups.
A Fintech Cyber Security Innovation Lab
will be established to prototype emerging
approaches, create value and facilitate early
adoption and commercialisation.
This report will be distributed to executive
teams across financial services, government,
education and other industries.
The federal governments Cyber Security
Growth Centre recent $230 million
investment aims to promote growth by
connecting Australias cyber security sector
with investors.
The new Innovation Hub will foster
partnerships and identify cyber security
focus areas.
Raised awareness of importance of
becoming a cyber smart nation and the
initiative to produce graduates to meet
industry needs and encourage more women
to pursue a career in fintech and cyber
security.
INNOVATING AT SPEED

9
 Startup engagement for corporate gain
Corporate decision-makers familiar with the big
marketing campaigns of large ICT vendors might not
see the value in working with a small startup for an
equivalent business requirement. The summit identified
the many benefits corporates stand to gain by engaging
with startups.

Figure 1: The business benefits of engaging with startups and summit enablement

10 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
 ESTABLISHING AUSTRALIA
AS A REGIONAL FINTECH-CYBER
SECURITY INNOVATION HUB
# Summit organisers are now accepting expressions of
THE FINTECH CYBER SECURITY SUMMIT
WILL BE FOLLOWED BY CONTINUOUS
DEVELOPMENTS ACROSS THE PROGRAM,
INCLUDING A NATIONAL DESIGN CHALLENGE
AND AN INNOVATION HUB.
WITH A NEED FOR MORE COLLABORATION,
CORPORATES SHOULD LOOK AT BRANCHING
OUT INNOVATION PROGRAMS TO INCLUDE TECH
STARTUPS TO SOLVE SHARED PROBLEMS AND
REALISE A SIGNIFICANT VALUE CREATION
OPPORTUNITY.
FOR MOST STARTUPS CORPORATES CAN
OFFER IMMEDIATE HELP BY BRINGING
THEM ON BOARD AS A SUPPLIER IT IS A
MISCONCEPTION STARTUPS ARE ONLY AFTER
FUNDING.
Australias inaugural National
Fintech Cyber Security Summit is
the first stage of a broader program
to establish Australia as a regional
hub for fintech-cyber security
collaboration and innovation.
The summit is the first step in raising awareness
in the value and opportunity for collaboration
between two industries, fintech and cyber
security, but will be followed by continuous
developments across the program, including a
national design challenge and an innovation hub.
More collaboration will also
teach corporates the benefits of
embracing the startup business
model to avoid stifling creativity,
Gordon Archibald, Partner, Technology
Risk Advisory Practice, KPMG
interest for joining the innovation program as partners,
sponsors and participants, including entrepreneurs.
There is a clear economic imperative for
cyber security capability in Australia as
we have digitally-advanced industries, like
banking, that demand it. It is important
to develop and enhance well-established
collaborative relationships between
research, industry and government,
Dr Alan Finkel, Australias Chief Scientist
Are you ready for cyber security innovation? The post-
summit industry development programs will enable
businesses and government to engage research and
development and startups meaningfully. Innovation
hubs like the summit co-hosts are developing will
put businesses and government in the drivers seat to
design problems they want solved now and in future.
Become startup ready with
an innovation program
With the summits main call-to-action being
a need for more collaboration, corporates
can also look at branching out their own
innovation programs to include startups, which
in turn benefits industry development.
A key learning from the outcome of the summit
was corporates have challenges interacting with
startups because there is a culture of you think
you are ready. There is a strong desire to work
with startups, but the organisation is not set
up to engage with them in a concerted way by
identifying a problem and helping with a solution.
As organisations are increasingly forced to partner
and innovate from the outside-in, collaboration
becomes core to ongoing competitive advantage.
One of the biggest mindset changes to become
startup ready is accepting that it is alright to fail and
fail fast, however, this is yet to be translated to how
employee performance is managed by corporates.
11
 Stone & Chalk CEO, Alex Scandurra, says organisations
need to go one level beyond an innovation program
and think of themselves as a platform, not a series
of products. Then make decisions around what
solutions and services you want to offer customers
that are led with your brand and what solutions
and services you want to offer customers with your
brand in the background, whether through APIs or
other means this platform centricity opens up an
entirely new range of options, Scandurra says.

1. STARTUP ENGAGEMENT 2. ORGANISATIONAL DESIGN 3. CULTURE

EXPERIENCE
How your organisation can work
with startups from a procurement
and commercial standpoint.
One finding from the summit
was purchasing managers can
better collaborate with smaller
companies to understand their
value proposition and redesign
procurement process to be suitable
for working with startups.
The mindset, attitude and internal
championing of startups to the
right people. This is the who and
the people help with the what.
Not all solutions help big enterprise
was a comment made at the
summit. Get your organisational
processes right first, then
collaborate.
Understanding and appreciating the
David and Goliath reality of startups
having short timeframes, or runways,
for funding. They need answers
quickly and clearly, honesty and
transparency. Also, who are the
decision makers?
The summit roundtable discussion
emphasised partnerships have many
benefits and corporates can try before
you buy to reduce risk. The winners
will be those that succeed in getting
to yes and figuring out how to make
things work, rather than the easy no.

Figure 2: Three steps to becoming startup ready

12 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
 Startup
snapshot Nuix

This sentiment is shared by Daniella Traino, Cyber

Security Business Lead at Data61, who believes Startup
corporates must recognise the many ways to
collaborate and not be so internally focused.
snapshot QuintessenceLabs
Partner with incubators and research and
development organisations to create solutions
and problem definitions together, she says. A
problem one financial services organisation has
can be extrapolated to the next and, ultimately, STARTUP SNAPSHOT:
Nuix
the financial services industry will be stronger
together so we can grow the capability we have.
Organisations can innovate internally, but they often
spend a lot of money doing this and are prone to YEAR STARTED:
failure. 2000
Dont miss out on a huge opportunity to collaborate STARTUP SNAPSHOT:
KEY PEOPLE:

QuintessenceLabs
with cyber security as it affects everyone. The network Eddie Sheehy (CEO), Rod Vawdrey (COO)
model will get you there faster and you will get better
URL: https://www.nuix.com/
and more sustainable outcomes, Traino says.
FLAGSHIP PRODUCT:
The Nuix Engine

If you want to be startup ready you need
to change your attitude to risk. Our
attitude to failure also has to change,
Charles Nightingale, Chief Customer Officer
Nuix Pty Ltd the Australian company used to
identify personalities in the Panama Papers
scandal is the developer of a software
platform for indexing, searching, analysing and
extracting knowledge from unstructured data.

Expected to list on the Australian Securities

Exchange as a business worth at least $1
billion by the end of next year, its success
Customers trump funding can be attributed to the Nuix Engine, the
core of the companys eDiscovery, digital
For many startups working hard to get a product or
investigation and information governance
service off the ground, corporates can offer immediate
solutions. Its the secret sauce that makes it
help by bringing them on board as a supplier.
possible to index and search large volumes
Scandurra says it is a misconception startups are only
of unstructured data with speed and rigor.
interested in funding.
Yes, funding is important, but there is one thing that
is the most important of all and thats customers,
he says.

13
 For this new way of working to succeed, however,
organisations will need to become startup ready.
They will need to re-engineer their procurement
processes, create testing environments and use
smarter approaches to managing risk these will be
the go to organisations for talent and top suppliers.
During the summit QuintessenceLabs CEO Dr
Vikram Sharma communicated the need to take
relationships past the traditional buyer-seller
dichotomy. When QuintessenceLabs started, the
product was still in the research phase and with the
help of private equity the company helped develop
the science. Collaboration with a US manufacturing
company also helped get it off the ground.
STARTUP LANDING PADS TAKE OFF IN THREE CONTINENTS
Taking a startup international is no easy feat, and
for young fintech and cyber security companies
doing business beyond Australias borders can
seem like an insurmountable dream. Thanks to
new landing pads in Sydney, San Francisco
and Tel Aviv, local startups can explore what
its like to go global. Australia-Israel Chamber
of Commerces Charles Nightingale says the
NSW government is leading the pack for fintech
startups to be chosen to go overseas and spend
two weeks in Tel Aviv in September. The landing
pad provides a unique short-term introduction
14 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
The opportunity for government to lead the way
by being a customer to more startups is massive as
agencies rely heavily on imported technology.
Since cyber security addresses challenges everyone
can relate to, it is easy to overhype a problem
and develop vapourware. A cure for this is a
deeper understanding of the problem and a multi-
disciplinary approach to problem solving.
to the Israeli startup and entrepreneurial
ecosystem. In Australia, the federal government
is also supporting startup landing pads via
Data61s partnership with Cyber London
(Cylon). The agreement includes developing
mutually supporting programs for improved
cyber skills and governance; the launch of a
Cylon accelerator program in Australia; and the
creation of reciprocal landing pads where cyber
innovation can be showcased to buyers and
investment capital.
AUSTRALIAS CYBER SECURITY,
FINTECH INNOVATION
PLATFORM
# Can we embrace cyber security as an obligation we
AUSTRALIA IS INNOVATIVE, BUT AWARENESS
OF THE CAPITAL REQUIREMENTS FOR CYBER
SECURITY IS LACKING OFTEN FORCING
STARTUPS OVERSEAS.
TO COMPETE REGIONALLY STAKEHOLDERS
MUST VIEW ELEMENTS OF CYBER SECURITY
AS A COMMON PLATFORM THAT CAN BE USED
ACROSS INDUSTRIES TO AVOID COMPETING
FOR RESOURCES.
FINANCIAL SERVICES AND GOVERNMENT
AGENCIES CAN BE THE DEMAND ENGINES
TO GROW DOMESTIC FINTECH AND CYBER
SECURITY CAPABILITY THAT CAN SCALE.
Industry development depends on
new ideas and a platform for turning
ideas into commercial businesses.
Australia has long been at the
forefront of information technology
adoption from the mainframe to
the mobile phone but our relatively
small market size and varying
appetite for investing in startups
has too often resulted in missed
opportunities for domestic ICT
industry development.
To become a regional leader in fintech and cyber
security, Australia must build a platform with enough
critical mass to support an idea through to a viable
product. This will not happen with one organisation
alone and must be driven by collaboration.
According to Chief Scientist Alan Finkel, the cyber
security opportunity requires an innovative approach
on par with the considerations we have for all of
Australias grand global challenges like training
scientists, mathematicians, engineers and ICT workers.
share, to achieve immunity for the digital herd? Finkel
says. At the summit it was heartening to hear the
many examples of Australian companies growing in this
space.
Financial services driving demand
Australias financial services industry is among the
best in the world. Our banking structure is robust and
technology adoption has resulted in easy access to
the full spectrum of services, from savings accounts to
securities.
According to the Financial Services Council 3, financial
services is Australias largest industry (larger than
mining and manufacturing) employing more than
450,000 people and contributing $141 billion to the
Australian economy.
There exists a significant opportunity for Australias
financial services industry success to be replicated for
both fintech and cyber security as both represent the
future of financial services more broadly.
Richard Stiennon, Chief Research Analyst, IT-Harvest
was the summits international speaker. Stiennon says
Australias financial services industry is well ahead of
the US when it comes to adopting digital technologies
and we can look at that for identifying cyber security
problems and take solutions to the US market.
Data61s Daniella Traino says too often early-stage
entrepreneurs head overseas to execute or access
capital and customers.
We are innovative but we dont have awareness of the
capital requirements for cyber security and suffer from
a lack of awareness of a startup scene it is emergent,
but by no means mature, she says.
There is also a pipeline problem we need to be
encouraging cyber entrepreneurs and apply different
thinking to the problem space. One element of that
is helping the business sector meaningfully engage
with innovation at all levels, and the other is by
providing the support networks like partnerships with
research and development groups. We heard from
representatives from both sectors that the opportunity
is recognised, but also collaboration around value
creation is new and will take work.
3
FCS State of the Industry report, 2016
15
 Startup
snapshot Nuix

Startup
snapshot QuintessenceLabs

STARTUP SNAPSHOT:
Nuix
For fintech and cyber security collaboration to succeed,
Australian industry stakeholders must identify the
challenges and develop an actionable path forward. STARTUP SNAPSHOT:
How can the commercial success of financial services
rub off onto another industry like cyber security?
QuintessenceLabs
According to Stone & Chalks Alex Scandurra, in the
case of banking it is worthwhile considering what YEAR STARTED:
elements of cyber security can be considered a 2008
common platform that can be used across industries
rather than trying to compete for resources Australia KEY PEOPLE:
doesnt have and trying to replicate in-house solutions Dr Vikram Sharma (Founder & CEO)
multiple times. URL: http://www.quintessencelabs.com/
We also need to work back from the problems FLAGSHIP PRODUCT:
government, corporates and consumers are facing and qStream Quantum Random Number Generator
for these organisations to partner with top startups
in commercialising new solutions, he says. Some
of the more progressive organisations are quickly QuintessenceLabs flagship product, qStream,
realising they dont have the resources, budgets and, delivers full entropy, true random numbers
importantly, time to develop new innovation internally to network attached clients securely and at
and are recognising both the need and opportunity of gigabit-per- second data rates. By harnessing
collaborating with startups to create something better, quantum science, qStream maximises security and
cheaper and faster than they could have otherwise prioritises speed while reducing data-security
achieved. management complexities. And its products will
secure data both in transit, at rest or in use.

Starting on the right foot In a further salute to the companys achievements,

one of Australias largest banks, Westpac,
With Australias cyber security innovation platform is poised to take an 1 1 per cent stake in
mired by a lack of recognition of the opportunity, it is QuintessenceLabs and a seat on its board.
imperative we promote what is done well and how we
can build from what we have.
Industry does a good job of competing for talent and
resources and the federal government does a good job
of flagging important issues, according to Scandurra.
The government has set a good high-level strategy for The summit proved even a small
the nation and help put cyber security on the map for organisation with the right vision and
industry and academia, he says. Hopefully through partnerships can achieve something great,
the Cyber Security Growth Centre there can be more
cross-industry coordination. Alex Scandurra, CEO, Stone & Chalk

Innovation is at the core of cyber security and

innovation can help organisation shift cyber security
from a cost centre to profit centre.

16 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
Owing to the financial services sectors responsibility
to protect data and transactions that keep the economy
moving, Scandurra believes the industry can be the
demand engine to grow domestic fintech and cyber
security capability that can scale.
According to Ben Rubinstein, a senior lecturer with the
Department of Computing and Information Systems
at the University of Melbourne, universities can play a
number of industry development roles, with the most
obvious being training future cyber security experts,
engineers and business leaders.
There is certainly a big skills shortage so it is
important for universities to play a part. Universities
have an appetite to collaborate with industry on
training and get feedback from industry on what skills
they want, he says.
This extends to industry exploiting university research
and development capability. Large companies,
particularly in financial services, require advanced
research across cryptography, blockchain technology,
quantum cryptography, and machine learning and data
science, Rubinstein says.
Universities have the research capability for those
areas, but they cant do it alone, we are not equipped
like big companies, he says.
The mismatch between Australias financial services
strength and our cyber security innovation is echoed by
Gordon Archibald, a partner within KPMGs technology
risk advisory practice, who believes this would develop
faster if there was more awareness of the impact of
cyber attacks.
A lot of innovation is still all words and it is not
being shared properly and collaboration needs to be
improved, Archibald says. Focus on cyber security
as a business enabler. It is about having trust and
confidence to transform business, open new markets
and consume new technology. It is time to move away
from the mindset of not embracing new business
opportunities.
Learning by observation: Israel
In Israel, significant alignment exists between the
government, defence forces, academia and industry.
The right incentive structures are in place for
commercialising cyber security technology where
there is remarkable collaboration between defence,
intelligence, research and industry.
Israel is at the leading edge of cyber warfare where its
people gain decades-worth of experience packed into a
few short years of national service. They then follow a
path to university and many seek to commercialise that
knowledge by creating a startup.
Given Australias nascent commercialisation maturity
and other limitations, we must successfully collaborate
with the local defence and Intelligence agencies to help
develop our cyber security industry.
CYBER SECURITY CALLING
FOR INVENTIVE ISRAEL
Israel is a good case study of how necessity
is the mother of invention. They inherited
what was a largely barren landscape and so
to survive they had to build everything from
nothing. What they have done better than
anyone else is incentivise alignment and
focus on the resources they did have their
people to develop innovation in many areas
across government, higher education, the
military and private sector. It has been this
collaborative effort and embedded teamwork
that has helped get them to where they are
today. We can learn a lot from global cyber
innovators like Israel, but the key is not to try
to replicate everything other nations do, but
focus on our strengths and build on them,
which was a consensus from the roundtable.
17
 APPLICATIONS WHERE FINTECH
AND CYBER SECURITY MEET

18 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
19
 CONTRIBUTE TO AUSTRALIAS
CYBER SECURITY DEVELOPMENT

# Australia has reached a significant

ORGANISATIONS ARE INVITED TO turning point in its home-
CONTRIBUTE TO THE NATIONAL FINTECH
CYBER SECURITY DESIGN CHALLENGE. grown cyber security and fintech
development capability. A three-
THE DESIGN CHALLENGE OBJECTIVE IS TO
CREATE, COMMERCIALISE AND, ULTIMATELY,
phased program is now underway
SCALE INNOVATION IN CYBER SECURITY to help develop Australias cyber
WITH REAL-WORLD APPLICATIONS. security industry. Phase one was
THE CYBER SECURITY INNOVATION completed in May with the inaugural
LAB WILL BRING TOGETHER National Fintech Cyber Security
STARTUPS AND RESEARCHERS TO Summit.
WORK ALONGSIDE CORPORATE AND
GOVERNMENT ORGANISATIONS TO For phase two, a national fintech and cyber security
CREATE AND COMMERCIALISE NEW design challenge will be held. Organisations are invited
IDEAS AT THE INTERSECTION OF to become a partner and to contribute in three ways:
FINTECH AND CYBER SECURITY. 1. Contribute to the problems, challenges or
opportunities that your organisation would like to
collaborate on with startups.
2. Provide access to colleagues with the relevant
expertise and authority to work alongside some of
the startups and to act as startup mentors.
3. Help co-fund the design challenge through a
partnership contribution4.
Each design challenge partner will be a full partner
and will be invited to participate in the preparatory
and delivery stages. The national cyber security
design challenge will seek to attract leading cyber
startups and researchers from across Australia and
the Asia-Pacific region. The selected teams will have
the opportunity to work alongside experts from the
innovation program partners. The objective being to
create, commercialise and, ultimately, scale innovation
in cyber security with real-world applications.
The design challenge will adopt the following
methodology:

PROJECT PHASING
PHASE 1 PHASE 2 PHASE 3 PHASE 4
Understanding the Application review Accelerate the idea incubation and
problem and and selection with sponsors commercialisation phase
customer pain points process

Figure 3: The National Cyber Security Design Challenge project methodology

20 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
Phase three, the final phase, will be the launch of the
Cyber Security Innovation Lab where startups and
researchers can work alongside larger corporate and
REGISTER YOUR
government organisations to create and commercialise
new ideas in cyber security and fintech.
EXPRESSION OF
INTEREST
We need to look at the intersection
This promises to be an exciting journey for all our
of the two industries to solve complex partners and Australia as a whole, as we embark on
problems and deliver real impact through establishing a Fintech Cyber Innovation Hub as a lead
collaboration, rather than by competing, in the Asia Pacific region.
To participate, or for further information please
Daniella Traino, Cyber Security Business Leader, Data61
contact contact@fintechcyberhub.com in the first
instance, and the Fintech Cyber Security Innovation
Hub partners will follow up with you directly.
The innovation lab will bring many ideas to practical
fruition and serve as an incubator for new business www.fintechcyberhub.com
development much sought after by startups.
With the right collaborative structure in place, Australia
has the opportunity to become a cyber security
industry leader in the Asia-Pacific region.
Ben Rubinstein, a senior lecturer with the Department
of Computing and Information Systems at the
University of Melbourne, says there is unlikely to
ever be one central location for cyber security
development in Australia, but it is good for universities
to participate with programs like the Innovation Hub to
be part of a centre of excellence and provide guidance
on which problems to tackle.

Programs like these are a good

matchmaker between universities and
government research programs to help
select the most pressing problems,
Ben Rubinstein, senior lecturer, Department of
Computing and Information Systems, University
of Melbourne

4
More information on co-funding will be provided separately
to registered participants.

21
22 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
ABOUT THIS REPORT

This report was produced by CSIROs
Data61, Stone & Chalk, KMPG and
the Australia Israel Chamber of
Commerce. The report sponsors
welcome any interest from local
The co-hosts and partners of the National Fintech
Cyber Security Summit are good examples of diverse
organisations coming together to contribute to a
common objective. Each brings a unique capability to
the summits objective and show how any organisation
can participate in Australias cyber security industry
development.

entrepreneurs looking to develop

fintech cyber security technology, or
from businesses looking to engage
with this startup ecosystem.

TABLE 2: ABOUT THE NATIONAL FINTECH CYBER SECURITY SUMMIT SPONSORING ORGANISATIONS

TYPE PURPOSE SUMMIT CALL-TO-ACTION

Data61 Research & Support government and private
Development sector research and development
programs. Connect startups
with industry. CSIROs Data61 is
Australias largest data-focussed
research and innovation group.
Raise awareness of the capital
of Data61 which can be directed
to help catalyse the industry.
Solve problems and extend
partnerships, run design
challenges and co-located labs.
Then open this to entrepreneurs
and corporates.

Australia-Israel International trade Form strategic alliances with Look at what can be done to help
Chamber of companies operating in Australia Australian business connect to
Commerce and Israel. startups in Israel at a macro level.
Organise trade missions to Israel.

Stone & Chalk Startup incubator Help high growth potential
startups commercialise and rapidly
scale. Help government and
industry partner with startups to
rapidly evolve.
Showcase Australias cyber
security potential. Provide the
collaboration opportunity and
help develop Australian cyber
security capability.

KPMG Business consulting Cyber security advisory services to Advise corporate clients of the
large organisations. benefits of collaborating with
startups as part of innovation
programs. Demonstrate best
practices for dealing with smaller
startups.

23
 We now invite leaders of industry, government and
research in Australia to come together to be at the
forefront of fintech cyber security innovation and
deliver a new model of industry development to create
and commercialise export-grade fintech and cyber
security products and services.
Australia has a strategic vision to become a leader in
cyber security and fintech in the Asia-Pacific region.
This report identifies the challenges and opportunities
Australia faces to turn our nascent capability into a
global industry.
National fintech cyber security summit
highlights industry opportunities
May 3, 2016 marked a watershed moment in Australias
ICT history. The first National Fintech Cyber Security
Summit brought together senior executives from
research, government, industry and startups to discuss
opportunities and best practices for collaboration.
The objective of the summit was clear: to help grow
Australias fintech and cyber security ecosystems by
generating critical conversations and address the
technological, cultural and mindset challenges to
stimulate more collaboration.
In April, one month before the summit, the federal
government released Australias cyber security
strategy which stipulated cyber security to be not only
important for protection against malicious activity
online, but imperative for business growth and
innovation. The strategy includes 33 new initiatives,
supported by $230 million in government funding.
The first government-led initiative is the establishment
of the new Cyber Security Growth Centre as part of
the National Innovation and Science Agenda5. With
$30 million in funding until 2020, the centre will
bring together industry, researchers and government
agencies to create a nation cyber security innovation
network; develop a strategy for Australias cyber
security industry to become a global leader and attract
foreign investment; and coordinate cyber security
research and innovation to maximise efficiency.
24 Startup secrets: How Australia can create new businesses with fintech and cyber security industry collaboration
Summit timing ideal to
spur collaboration
With the governments innovation agenda in motion,
the summit exposed a new kind of collaboration
opportunity between established industries, research
organisations and smaller startups.
During the summits roundtable event, participants
recognised the opportunity of fintech and cyber
security coming together to focus on innovating
around complex business problems in cyber security,
and the strength in collaboration with research,
industry and government.
The summit was the first time such a high calibre
delegation of cyber security and fintech leaders
gathered in a forum of this type and attendees heard
inspiring stories from startups showing it is possible
to be successful from Australia and create something
in the region with potential to be quite powerful.
Messages from the corporate world on what we need
to do better to engage startups and create growth and
value were also shared.
Moreover, the summit uniquely brought together key
stakeholders with many longing for new collaborative
efforts across industries and research groups.
The participants of the roundtable voiced their
willingness to play a key role in collaborating to help
develop Australias cyber security capability. While it is
easy to be distracted by what we are lacking, Australia
has potential and valuable resources.
In addition to more collaboration, summit attendees
expressed the need for Australia to develop its own
cyber security industry to reduce dependence on
imports and take advantage of domestic intellect
to solve cyber security challenges differently, which
can help impact the cyber security threat landscape
globally. By doing so Australia has the opportunity to
create a sustainable and economically viable industry
and play a significant leadership role regionally.
Being able to engage with a range of different sized
organisations was also a significant benefit for summit
attendees. For a first summit it was a success and there
are bigger plans for the next one.
5
http://www.innovation.gov.au/
CONTACT DETAILS
This promises to be an exciting journey for
all our partners and Australia as a whole, as
we embark on establishing a Fintech Cyber
Innovation Hub as a lead in the Asia Pacific
region.
To participate, or for further information please
contact contact@fintechcyberhub.com in the
first instance, and the Fintech Cyber Security
Innovation Hub partners will follow up with you
directly.
www.fintechcyberhub.com