Australian startups are heading over to Silicon Valley to seek venture capital. The American economy has benefited trillions of dollars from startup companies since the financial crisis. However, this seems like trouble for Australia as Aussie entrepreneurs are taking their startups away from the country.

Australian Startups Moving Away

According to Adeo Ressi, CEO of the Founder Institute, the lack of venture capital investment in Australia forces Australian startups to seek financial backup in the US.

“Australia looks like an amazing place to live. It’s developed, there’s rule of law, education is good,” he said, “It does not have however a thriving venture capital market.”

Ressi added that innovators have to leave Australia to find venture capital and to find a market that’s large enough for their companies to grow.

“It’s really about closeness to the market. So if you’re going after an English-speaking market and you’re in Silicon Valley you’re closer to the 300 million consumers in America.”

However, he stated that it’s generally not a bad thing for Australia. Ressi suggested that CEOs can move the company to Silicon Valley but leave an office in Australia as a breeding ground for new entrepreneurs.

Stopping the Brain Drain

The prevalence of “brain drain” today has concerned Australians- the country’s best and brightest leaving their land to find their success offshore.

“If someone’s going to leave it’s hard to make them stay, but I can tell you there are two things that a government can do, and particularly Australia, to improve their lot,” Ressi said.

He suggested that the first thing Australians should do is to invest in education and technology literacy in order to create the next generation of entrepreneurs and leaders that will replace the people moving away.

Then, he recommended that Australia should cultivate an active venture capital community. If this is followed Australia will see its economy rise as what’s happening now in the US. Hundreds of billions of dollars of value have been made by startups to the American economy.

Ressi said that the economic value has helped the country move forward in the face of many other economic problems.