Some really good conversation going on over at the Silicon Beach Australia Google Group.

The question? How do we replicate silicon valley in Australia?

The answer? We probably can’t.

The problem? See Paul Graham’s thoughts on the matter. Essentially - Silicon Valley is the result of a set of circumstances that aren’t easily replicable.

The solution? We have to iterate and create not a silicon valley but something that works within the environment we have here in Australia. Who knows…maybe in 10 or 20 years there might be discussions in Silicon Valley about how to be more like Australia…

With that in mind, below are what I believe are 5 steps, off the top of my head, that WE can take to improve  the aussie tech startup industry. These are things that we can work on right now and that don’t rely on others like the Government. If things such as tax incentives, for instance, improve, then great. if not, the plan goes ahead.

Step 1. Stop Hating on VCs and Angels. It’s a poor excuse.

As is being explained in the discussion, if you have good businesses, the investment will follow. That having been said there are lots of reasons why VCs aren’t right for most tech startups. These include the amount of dollars they have to invest to make the investment worthwhile, the types of returns they’re seeking and so on.

VC’s don’t hate tech.

Neither do angels for that matter.

It’s just there’s no compelling argument for them to invest money in tech when they can get better returns from investing in mining, or blue gums. VCs and angels don’t work for charities. They invest money to to make returns. Once we can demonstrate to these groups of investors where the value in tech startups is then maybe we’ll start to see more investment. Note that by value it might be something different to money. Most of these guys aren’t dumb. Actually they’re pretty smart. Give them a genuine reason to invest in your company over another investment option and they probably will. In the meantime, my promise to you is that I will continue to do all I can to raise awareness of Aussies tech startups and their potential within these groups.

Step 2. Build businesses that create value

This one is fundamental. Businesses that create value have a far greater chance of being successful than those that don’t. Sounds kind of basic, right? Well how many people can honestly explain the value that their project/company creates?  I get the feeling that there are alot of people out there that think if they develop a site that they think is cool then they’re entitled to be bought by Google. This leads me to my next point…

Step 3 - Set your expectations correctly. 

Users and Investors will NOT come just because you build it. Be honest and ask yourself how much value your project really creates. On top of that, how much effort are you really willing to put into it? There are a whole bunch of other questions that you should be asking yourself but those two will help you set your expectations re: how much might be able to get back in terms of interest from users, first of all, and potential investors, secondly.

There’s nothing wrong with building a site to get a couple of hundred users, or focussing only on Australia, or trying to be the next Facebook. What’s wrong is when you kid yourself about the true potential of your project or fail to commit to the project and the goals you claim to have set then whinge about how the local tech scene sux cause you haven’t made a gazillion dollar exit within 12 months.

Step 4. Build awareness

The guys in the discussion are speaking about the need for a Techcrunch Australia. How’s about we just start by trying to make a good TechNation Australia?

That having been said, there’s a problem that will stop either site from taking off. There are heaps of projects out there but the vast majority of people don’t talk about what they’re doing. Most people I know and speak to hold what they’re doing way too close to their chest.

Talk guys. Seriously. Talk. 

It’s not just about sharing ideas its also about learning HOW to talk about what you’re doing - how to promote yourself and your project. Users, mainstream media and Investors (whether developers who you give equity to, angels, VC’s or Investment Bankers) want to be excited about projects. They want to believe in what you’re doing. So you need to lose this perception that self-promotion is a form of arrogance. It’s not. Figure out what it is you’re doing and why it adds value then tell as many people as possible. If it has potential, over time you’ll fine tune your message into something that gets others excited.

Step 5. More Doing

Discussion is great. Action better. At least in this case. The truth of the matter is that nothing is going to change quickly. We can lobby Government to change tax incentives, we can have lots more successful startups, we can have more funding, but it will take a while to get the underlying infrastructure up to have a sustainable, successful tech industry in Australia. That probably means that our best guys are still going to head overseas for the foreseeable future. As long as they eventually put something back - kind of like we’re starting to see with overseas football players coming back to the A-League - then we should be OK.

There are lots of people trying to do good things in this space. A lot of them are involved in the Silicon Beach discussion group. A lot aren’t. Either way, why not join them? If you don’t have time to actively start something then make sure that you at least support gtheir efforts.

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I’m sure I’ve missed some points, but those are my initial thoughts.

I’m keen to hear yours.