A businesswoman has discarded the outdated idea that Australia is the land of fairs as she would never have been able to start her business without financial help from her parents.
When Ashlee McGonigle, 18, from Ourimbah on the New South Wales Central Coast, had an idea for her business when she was just 15 in the Covid lockdown, she turned to her parents.
“I just thought, why not try it? I have time,” he said.
But obviously I didn’t get financial advice or anything like that. I had no education on where to find the information for that, or where to start, or how to raise funds.
“That’s why I’m so grateful my parents intervened.”
The founder and designer of Sand Rose Designs He said his business “probably” wouldn’t exist if it weren’t for financial help from his parents.
“They started with $5,000 and that’s when I started building my website and organizing all my products and samples,” he said.
“It eventually turned into a $15,000 loan from my parents simply because I kept adding products and the products kept selling; I just needed to get some money to help me get a little further along.”
18-year-old Ashlee McGonigle (pictured modeling one of her bikinis) turned to her parents when she was 15 to help fund her business idea.
The college student (pictured) said she borrowed $15,000 from her parents’ bank to start and grow her business. He admits that he ‘probably’ wouldn’t have a business if they didn’t lend him the money.
In just three years, the 18-year-old went from the little material she could get with her parents’ initial $5,000 to selling more than $100,000 in inventory and shipping worldwide.
Ms McGonigle said not everyone can receive the help she received.
“I’m not sure how other people find funds,” she said.
“We need to encourage more education about financial support just so people aren’t afraid to step forward and start the business they’ve been thinking about doing,” he said.
A new report from the Australian tech unicorn Airwallex found that one in three startup founders nationwide are being funded by their parents.
Matt Sek, vice president of growth at Airwallex ANZ, told Daily Mail Australia the proverbial “bank of mum and dad” is not new, but it is relied on more than ever.
“Given the macroeconomic environment (it’s) not surprising that there is a growing trend of founders looking beyond traditional funding and funding,” he said.
“What was surprising was the magnitude of one in three founders; it’s something that, in my view, is unprecedented.”
Mr Sek said Australians did not “necessarily” need rich parents to succeed in business, but “it does help”.
“But the biggest thing we found was that (the founders) didn’t know where to get resources, who to talk to and really be part of a community,” he said.
McGonigle believes the economic climate is even more difficult now than when he started his business. The teen knows that people will have a hard time getting their idea off the ground if they don’t have parents who can help (pictured, one of Sandy Rose Designs’ products).
And not being aware of where funding is available can create a “brain drain” from Australia.
“It’s already happening in the sense that many high-potential startups in Australia, especially in areas of fintech and climate technology, are already looking to attract international investors,” he said.
Mr Sek believes the heavy reliance on the bank of mum and dad is because entrepreneurs feel “lost” when trying to turn a business idea into a reality.
“It’s not that the investment is not available, it’s making that connection point,” he said.
‘It seems relatively trivial, but it’s not something we’ve solved particularly well compared to other markets, such as the United States.
“While the bank of mom and dad can be helpful in funding a small idea and getting it off the ground, I don’t think businesses will be able to sustain and scale simply by relying on a single source of funding,” he said.
AirWallex created a free startup community in May where members can access financial education and grant advice.
Some 1,200 budding Australian entrepreneurs have already signed up.