Airwallex report reveals 92% of Aussie Startups struggle with their financial operations

• 33 percent of startups are financially supported by Bank of Mum and Dad, according to new research from Airwallex and YouGov

• 87 percent of founders have concerns with their bank or financial provider

• Despite 78 percent of startups planning to expand globally in the next 12 months, 90 percent say there are limitations to them doing so

MELBOURNE, AUSTRALIA - Airwallex, the Australia-founded leading financial platform for modern businesses, today released The Startup Financial Confidence Report which reveals the opportunities and business challenges facing Australian founders right now.

The inaugural report, the largest study of its kind in Australia, was commissioned by Airwallex and deployed by YouGov, surveying 500 startup founders across Australia to unpack their confidence levels and pain points when it comes to financial operations.

Amid a challenging economic backdrop of high inflation, rising interest rates and ongoing economic uncertainty, the report reveals founders are turning to unconventional sources for growth and financial advice. From family to professional networks, founders are looking beyond financial professionals to accelerate their business growth. In addition, 87 percent of founders have concerns with their bank or financial provider, with 37 percent saying the flexibility to access funds is a deciding factor when considering a business bank or provider.

Further findings from the report include: 

• 92 percent of founders have concerns about their business' financial operations: The biggest concerns that founders shared involved maintaining compliance, with their top worry being managing local regulations.

• 33 percent of founders, one in every three, are supported by the Bank of Mum and Dad. Parents aren’t just funding property purchases for the next generation, they’re also bankrolling businesses, as we stand on the precipice of the “biggest exchange of gifts and inheritances in human history” (The Australian, 2024).

• 40 percent of founders are looking to their professional networks for financial advice, second only to external finance consultants (41 percent). Almost all founders (98 percent) are seeking financial advice for their businesses. 

• The most common complaint from founders about banks/financial providers was the lack of financial products and services designed for their needs as a startup. Almost half (44 percent) of founders suggested this was a major frustration, followed by high fees (37 percent), poor understanding of needs as a startup (37 percent) and inadequate flexibility to access funds (35 percent).

• Nearly four in five (78 percent) founders said they are likely to expand their business globally in the next 12 months. However, 90 percent say there are limitations to them doing so.

Taylor Fox-Smith, Head of Community Partnerships at Airwallex, said that, despite the thriving sector, there’s a confidence gap when it comes to steering the finances of a startup. 

“This unique research is critical in understanding the needs of this diverse community – and more importantly, identifying what support is needed to help these founders thrive in their startup journeys. 

“In today’s volatile economic climate, where funding cycles are tightening and global markets are uncertain, these findings not only illuminate the current challenges but also show the other side of the coin – highlighting opportunities for startups. And there are many – such as the flexibility that comes with using global accounts and mitigating traditional banking restrictions through international payment rails to enable global growth. 

“With more than 1,200 Aussie startups now part of the Airwallex for Startups program, we know there’s a real appetite from founders for support across various areas such as funding and operations. We are confident these insights will empower an ambitious cohort of current and future startups and the next generation of Australian unicorns.”

The report also contains industry expert analysis and views on the findings from the likes of AI Build Club, Cake Equity, LUNA and upcover. 

To download The Australian Startup Financial Confidence Report, visit here. To find out more about the free Airwallex for Startups program see here.

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Methodology 

This study is based on an original nationally representative survey commissioned by Airwallex, and deployed by YouGov.  The study was conducted online between 11 and 24 June 2024. 

The survey sample comprises 500 Australian founders or owners aged 18 years and older in start-up businesses. Businesses must have been established in the last 10 years and have 2 to 199 employees, in line with the ABS definition of small and medium enterprises (excluding sole traders). All results are unweighted proportions.

Notes to editors

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About Airwallex

Airwallex is a leading global financial platform for modern businesses, offering trusted solutions to manage everything from payments, treasury, and spend management to embedded finance. With our proprietary infrastructure, Airwallex takes the friction out of global payments and financial operations, empowering businesses of all sizes to unlock new opportunities and grow beyond borders. Proudly founded in Melbourne, Airwallex supports over 100,000 businesses globally and is trusted by brands such as Brex, Rippling, Navan, Qantas, SHEIN and many more. For more information, visit http://www.airwallex.com