How to create regional tech ecosystems that drive growth

Amanda Caples, November 2025

The prevailing discourse on innovation generally leads to advice to governments (federal and state) on how "to fix" the research, development and innovation system. Sometimes this advice is sound.

Having worked in public innovation policy for some time, I conclude that neither the research nor the business community understand the economic growth role of government as the steward of the innovation ecosystem.

This is not surprising when the purpose of government often gets lost in the language of policy and the headlines of funding announcements.

It would be fair to say that I didn’t know a lot about economic policy either when I joined the Victorian Public Service over 20 years ago. But as Victoria’s inaugural director of biotechnology and now lead scientist, I’ve seen firsthand how the right mix of policy, people, and platforms can transform regions into innovation powerhouses.

This doesn’t happen by accident.

It requires a deliberate, long-term approach — one that builds capability, fosters specialisation, and aligns public and private efforts.

For example, here in Victoria we have had a long-term policy commitment to build a biotechnology industry on the foundation of our comparative advantage in health and medical research.

We understood that as a sub-national government our role was to provide talent with access to the tools, technologies and translational capabilities that underpin excellence in science. In doing so, we leveraged co-investment from industry, the federal government and philanthropy.

This approach to regional specialisation has supported the stock and flow of businesses and has attracted local and global players to substantial investment in manufacturing facilities here in Melbourne.

The job is not yet done but we have shown how to build a specialised regional technology ecosystem as part of an economic growth strategy.

So, what have we learned that could be applied to new sources of economic growth?

The key is to start with asking two fundamental questions: Where do we focus our efforts? How do we win?

To answer these two questions, we need a framework that helps us understand our strengths and gaps.

Regions must assess and build on:

• Foundational Capability: What are our scientific and technological strengths? Where are we globally competitive — and where do we need to build?

• People and Talent: How do we grow and attract the right talent — both the technologists who create and the sophisticated users who apply?

• Tools and Infrastructure: Do we have the research platforms, specialist equipment, and facilities that underpin innovation?

• Investment Attraction: Are we targeting the right global players — those who can catalyse local ecosystems and supply chains?

• Testbeds and Foundries: Are we creating environments where industry can engage, test, and adopt new technologies?

• Government Procurement: Are we using public sector demand — defence, civil, health — as a lever to stimulate innovation?

Answers to these questions shape the development of a sub-national technology economic development strategy — not just here in Victoria but around Australia. And crucial for success is to involve stakeholders in the development of the strategy. In other words, to co-design rather than rely solely on feedback.

This matters because the regions that get this right will be the ones that attract the talent, the capital, and the customers. They’ll be the ones where startups scale, where global firms invest, and where innovation becomes a competitive advantage.

If we continue to be unable to see the wood for the trees because we do not understand each other’s role and purpose, then we will continue to underachieve.

Let’s work together to make Australia not just a participant in the global technology economy — but a leader.

Dr Amanda Caples is Victoria’s lead scientist.

This Innovation Insight first appeared in InnovationAus on 26 November 2025