Wotif founder calls for innovation tax benefits

Australian entrepreneur Graeme Wood has called for the introduction of tax benefits to promote innovation in the digital economy.

Linked gallery: Photos: World Computer Congress 2010

Delivering the opening keynote at the World Computer Congress in Brisbane today, Wood joked that the Government should appoint a 'Minister for Inspiring Creativity'.

"The question is, is the Government good at driving innovation?" said Wood, the co-founder of travel booking site Wotif.com.

"I'm not just picking on the Innovation Minister; I think every leader can do better," he told iTnews.

Noting that even academic research relied on business partners to be commercialised, Wood said tax benefits would drive the free market to seek and support innovative ideas.

He recalled his previous work experience at IBM, where he said the "rate of delivery of innovation" was driven more by company accountants than by market demand.

"Every Australian prefers to pay as little tax as possible; we've seen examples where tax policy has changed industry," he said.

"Where there is a taxation incentive, people will rush in blindly and take advantage of that.

"If there were tax benefits to innovation, I think there would be investors roaming the streets looking for garages with lights on and the next Bill Gates."

GDP (gross domestic product) was too narrow a measure of national progress, Wood said, arguing that it did not negatively reflect oil spills, car crashes and cigarette advertising.

He said tax benefits and policies could also shape technological outcomes to reach a balance between products built for monetary profit and societal benefit.

Wood described, as an example, games built for tablet PCs, which could be designed for pure entertainment, or to support education.

Educational applications could be exported for foreign aid, he suggested,

"If the policy approach were more entrepreneurial and if funds were made available for this to be developed, there is a giant export market for whoever does it well and does it first," he said.

Lessons in entrepreneurship

Wood outlined four steps of entrepreneurship: conceiving an idea; developing a prototype; acquiring business resources and skills; and execution.

Recalling publicity difficulties when Wotif.com launched in 2000 - at the time of the .com bust - Wood said innovations should lend themselves to word-of-mouth marketing.

Would-be entrepreneurs often neglected to sufficiently consider real-world testing and market demand, he said, highlighting common arguments that the marketplace did not want a product only because it "did not understand it".

Innovation and ideas remained the "lifeblood" of Wotif.com a decade since its founding, and the company tended to hire "thinkers" who were new to the hospitality industry.

The company sought to avoid the traditional, established lines of thinking that many hospitality industry veterans preferred, Wood explained.

"I think [innovation is] a leadership issue," he said. "What could, should we be doing to nurture trial and loss and risk taking?"

Entrepreneurship was "often very simple", he said: "All you've got to lose is money and possibly your reputation - if you have little of either then you're a perfect candidate."