Sydney Startup Hub shuts down today, after seven years, thanks to the NSW government.
And right now it’s clear that when it comes to startups, the government couldn’t organise a piss-up in a brewery, to use one of the more polite versions of the idiom.
Another way of explaining it is that they’ve bombed the Sydney Startup Hub to “save it”.
When NSW science, innovation and technology minister Anoulack Chanthivong revealed the move in December 2024 he had no details beyond ‘somewhere in Tech Central’.
Eight months on, the Startup Hub’s future is still unclear.
The minister, who seems busier than a Circular Quay busker, is also in charge of the better regulation, fair trading, industry, trade, building and corrections portfolios.
Minister Anoulack Chanthivong at the NSW Budget Estimates committee hearing this week. Screenshot
So you could forgive him if startups are not at the top of his priority list. The sector more broadly, and this writer, have picked up that vibe since Labor came to power in 2023 and kicked off by cutting funding to the Sydney Startup Hub.
The Hub has been home to Stone & Chalk, Tank Stream Labs, Fishburners, Antler, the disability accelerator Remarkable and Microsoft Reactor, and others, as well as the Regional Landing Pad and International Pad, with room for 1800 people and around 500 startups. Shared desks started at around $100 a week.
Its importance to the sector should be remembered in Tim Fung, chair and CEO of ASX-listed Airtasker turning up to help build the Tank Stream Labs site there.
Since Chanthivong announced the move, the new location felt like a state secret for most of 2025.
But we now know, thanks to the Investment NSW website that it’s the Sydney Scaleup Hub at 477 Pitt St, Sydney, 2km down the road, which is being rebranded as Tech Central Innovation Hub.
Deal not done
The only thing is, just days before the closure, Investment NSW had not yet finalised a deal for a potential operator, as InnovationAus reported on Wednesday. And who’s going there is also up in the air.
And the only tenant, apart from Stone & Chalk, which operates the Scaleup Hub on behalf of the government, hoping to relocate there from the existing site, is Fishburners, which even as the doors are supposed to close, awaiting a green light for its move, is staying put until at least mid-September.
In the meantime, the other tenants have scattered to the winds, ending the collaboration that embodied the Startup Hub since it opened in 2018.
Coworking space Tank Stream Labs and accelerator and investor Antler won’t be part of the new site and made alternative arrangements. The Microsoft Reactor has gone.
Stone & Chalk, which operates in Sydney, Melbourne and Adelaide, bailed from York Street early, and has been a vocal supporter of Tech Central, with a vigorous social media marketing campaign backing the concept.
But it’s worth remembering that they lost $6.95 million in the 12 months to June 2023, on top of a $1.5 million loss in the previous year.
Stone & Chalk CEO Chris Kirk
CEO Chris Kirk spent considerable time righting the ship, telling Startup Daily in March 2024 that said: “Over the past six months, we have implemented a comprehensive action plan to fortify our financial position and secure long-term sustainability. We have successfully worked with our partners to secure additional funding, and at the same time, seen significant growth in our national startup and scaleup community.”
Stone & Chalk’s consolidation from old site makes sense in that light, especially given the repeated statement that York Street was “not commercially viable”.
The Covid pandemic transformed how people work and while the government subsidised the Startup Hub site, it’s clear that Stone & Chalk, as well as Tank Stream Labs and Fishburners struggled under a new financial dynamic.
But the question remains in the context of early-stage startups: what does commercial viability look like and what’s the best way to support companies with little cash and often pre-revenue if you want them to come to the city? After all, premier Chris Minns is the one who called for workers to get back to their CBD offices to support the economy.
A lack of desks
There was also a telling moment during the NSW Budget Estimates committee hearings on Monday, when the Investment NSW leadership was asked about the change and the maths didn’t add up.
Liberal MLC Jacqui Munro, the shadow assistant minister for innovation, said her understanding was that “Wynyard had about 600 desks available, and now there might be 250 desks available”.
Investment NSW head of innovation and entrepreneurship Liza Noonan said that talking to the tenants, they’d “been operating at something like 50% occupancy at the startup hub”, while three-and-a-half floors have been vacant for some time – “we lost anchor tenants in corporate terms like Optus and Caltex years ago,” she said – and “the product that the Sydney Startup Hub is offering was no longer competitive” amid “a very competitive co-working market in the Sydney CBD”.
The Tech Central Scaleup Hub at 477 Pitt Street, designed for more mature companies, offers suites and other facilities for 60 scaleups, as well as shared office space across two floors, with around 150 desks. It was developed by the former Coalition government.
Noonan said there’s at least 100 more desks available at the Pitt St site for the move.
I’m not Sir Isaac Newton, but may I suggest that if “around half” of 600 desks were being used, and the new offer is “at least” 100, and apparently 60 startups have already put their hand up for space, even if you assume the 150 scaleup hub desks are also available, you’re still offering less space than the Startup Hub’s current usage levels.
Because the cost of a desk can’t be disclosed, something that puzzled Munro in a chicken-before-the-egg way, it’s hard to figure out whether it’s an issue compared to the old site. Are founders being priced out of Sydney? We don’t know.
Noonan told Budget Estimates “we do believe there’s vacancy. I’d have to take on notice the exact amount of vacancy within the Stone and Chalk floors”.
Antler began life at the Sydney Startup Hub in 2019. It’s moved elsewhere with the shutdown
More than 1,800 startups have been residents at the 11-floor building above Wynyard train station. Together they’ve created around 6000 jobs and attracted nearly $1 billion in investment, while another 50,000 people have been to more than 1000 events there, and another 4000+ entrepreneurs from regional NSW have dropped in to use free desks and meeting rooms there.
That’s according to Investment NSW. That figure sounds like a reasonable ROI for taxpayers, especially if you compare to size, scale and returns of other government industry support.
The Minns government broke the York St lease. How much doing that has cost taxpayers is something Investment NSW said it had to “take on notice” – a surprising option since this debate is all about the business case and its cost to taxpayers.
Noonan said they’d been actively trying to fill that space, there wasn’t market demand.
“So I think we go back to the point, and the reason the decision was made was that the commercial models of the anchor operators in the Sydney Startup Hub was no longer viable based on post- Covid working habits of startups,” she said.
A history of cost cutting
Meanwhile, please remember is that the NSW government gutted Investment NSW in April 2024, with a quarter of its workforce cut, and placed it under the control of premier Chris Minns, the man who can find $16 million for cage fights staged by a verbally abusive promoter, yet cut startup funding, including to the Sydney Startup Hub, when Labor came to power in 2023.
The government is spending $5 million in capital expenditure on the relocation, including making the scaleup hub more suitable for startups, with a refurbishment of level 13.
Back at York St, 3.5 levels at the CBD hub have been empty for “some time”, Noonan said, and there has not been a “market demand” to replace departed corporate tenants like Optus and Caltex.
“We looked at the market demand at the [startup] hub, and we looked at the current occupancy of the Scaleup Hub. We thought there was a real opportunity to consolidate services and programming for startups at all stages of their journey within Tech Central,” she said.
“So our view and our modelling was that that was the best course of action.”
Munro asked what was happening with Fishburners saying “they’ve started partnering with WeWork – is that because they haven’t been able to come to an agreement that allows them to move into Tech Central?”
“We’ve been engaging closely with fish burners throughout this entire process. My understanding with Fishburners is that they’ve had a fairly significant look at their business model and looking at the needs of startups that they serve,” Noonan replied.
“And they’ve actually had feedback from residents that they’d prefer a more networked approach, including residency here in Sydney, but also in locations around the world which the partnership with WeWork.”
She didn’t want to comment on what’s happening or the cost of desks at the new location because “we’re in negotiations currently with the anchor operator [at the Scaleup Hub]… so I wouldn’t want the statement I make here to impact the outcome of those negotiations for both Fishburners, other operators in the ecosystem, and obviously for startups themselves will accommodate.”
“Negotiations” is truly gobsmacking. Eight. Months. On.
It’s hard to believe that anyone in the Startup Hub, given the sector’s mindset, tried to drag out negotiations, so where should blame be apportioned for uncertainty for the hundreds of founders and startups looking for a place to work and unclear about their future in the week when the government is shutting down the site?
Munro asked about why it’s shutting now, when the original release said October. Investment NSW appeared unaware of that detail. We quoted Minister Chanthivong’s “October” announcement here last December if they need a reminder.
Not my fault
Earlier in Budget Estimates, minister Chanthivong, who proved to be a master of delegation in terms of who was responsible for decisions, blamed the former Coalition government for the demise of the existing Startup Hub. The Laboregovernment made the “right decision”, but Investment NSW is responsible for what’s happening with the relocation.
TL;DR. Wasn’t me gov, honest truth.
“The government made the decision to wind up the Sydney Startup Hub based on the fact that the contract that was signed by the former government was so bad that it needed to be totally revamped,” Chanthivong said.
Munro asked is the minister would meet with the startup sector to hear their concerns.
He obfuscated and declined.
The promise
“New accommodation at Tech Central will include a refreshed service offering more attuned to supporting diverse people and teams to startup and scale successfully. It will continue to offer an affordable place for both startups and scaleups to meet, collaborate, work and grow,” the Investment NSW website explains.
“This move helps ensure startups and scaleups can collaborate with an entire ecosystem right on their doorstep. It’s all about giving the support to build Australia’s next tech unicorn.”
Another way to describe the government’s plan – it’s hoping to release an actual strategy for Tech Central at some unnamed time down the track might best be described as Covid redux.
It’s hoping that by walking past Canva in Surry Hills on the way to work, startup founders might catch unicorn vibes and become billion-dollar tech companies too.
Then the minister can stand beside them in a success story photo opportunity.
Except he won’t get to, nor will future ministers, because right now, Sydney startups will have to survive despite the NSW government, not thanks to it.
Startup Daily approached the minister’s office with a detailed list of questions, but did not receive a response before publication. It has now been included below
Stone & Chalk and Fishburners also did not response to requests for comment.
- Editor’s note: A spokesperson for the minister issuing the following statement shortly after publication:
“The Sydney Startup Hub is a prime example of the Liberal-National Government’s legacy of waste and mismanagement.
“When they signed the contract to run the Hub in late 2022, they knew the COVID-19 pandemic had impacted startups and reduced demand for office space.
“Since then, the hub has consistently struggled to fill available desks, sometimes sitting at around 50% capacity.
“Former Minister Alistair Henskins and the Liberal-National Government locked taxpayers into subsiding office space that no one wanted. Their decision has left taxpayers, government, startups, and anchor tenants all worse off.
“Investment NSW remains in negotiations with Stone & Chalk, the anchor tenant at the Scale Up Hub, for the transition of start-up services into a new Tech Central Innovation Hub.
“The NSW Labor Government tackles issues head on to clean up the mess that the Liberals left behind and we are working to ensure the new Tech Central Innovation Hub is sustainable and value for tax payer money.
“Transitioning to Tech Central will enable founders, entrepreneurs, investors, and corporates to collaborate more closely with universities and research institutes, in Australia’s leading innovation precinct.
“In the 2025-26 Budget, the NSW Government committed around $80 million in support for the innovation sector, including $38.5 million for Tech Central.”
- Disclosure: Startup Daily hosted regular events at the Sydney Startup Hub, and sponsored some of its tenants. Fishburners CEO Majella Campbell cohosts Startup Daily’s weekly podcast, Startup 360, with this writer. We also applied for an Investment NSW grant for the Best in Tech awards, but it was declined.
