The Growth Box shuts after nine months

04/05/2018 - 14:59

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Startup hub The Growth Box has shut its doors in recent weeks, less than a year after opening, with project proponent the Malaga & Districts Business Association facing an uncertain future after 26 years in operation.

A very fast internet connection was one aspect of The Growth Box intended to encourage take up.

Startup hub The Growth Box has shut its doors in recent weeks, less than a year after opening, with project proponent the Malaga & Districts Business Association facing an uncertain future after 26 years in operation.

The Growth Box was opened by the MDBA in July last year with seed funding from the City of Swan and Department of Commerce, as part of a strategy to encourage startup and technology businesses into the area.

One attraction touted for the facility was a 100 megabit per second upload and download internet connection, which is faster than the best National Broadband Network services.

Facilities included a boardroom, training rooms equipped with computers for groups of up to 30 people, and office space.

Business News understands only one tenant took up a lease at the hub.

Former chief executive Clive Haddow left The Growth Box in December, citing ill-health, while Local Government Advisory Board chairman Mel Congerton stepped into the role of acting chief executive in late January, with a remit to attempt a restructure.

The Growth Box closed on March 30.

Mr Congerton told Business News the project had been unviable.

“At the end of the day, when you're facing an income stream that was minimal, and a very expensive exercise to maintain a building of that size, the (MDBA) board’s decision was to call it a day for The Growth Box,” he said.

“The functions centre was rarely used ... a lot of time and energy went into promoting it.

“A sad state of affairs.”

Continued operations of The Growth Box would have cost $100,000s annually, Business News understands.

Mr Congerton said The Growth Box's model had potentially been flawed, while issues exacerbating the problem included low utilisation of the functions centre, lack of participation by members, and no demand from startups.

The MDBA and its board will meet on May 15 to consider the association's future.

“It chewed away really all the money that the MDBA had,” Mr Congerton said.

“It probably would’ve traded insolvent if (the MDBA) hadn’t decided to close the doors.

“(The MDBA) was a 26-year operation.

“In reality it was (finished in) nine months.”

The City of Swan resolved to cease funding to the box in a March meeting, although discussion of the motion was deemed confidential.

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