Australia startups turn to Silicon Valley as local investors shun risk

Sydney

FOR the cost of a Sydney home, Paul Evans would be able to market an electric-car engine that could help put Aussie innovation back on the map. In risk-averse Australia, most investors would prefer to buy a house.

The entrepreneur has been shunned by local venture capital funds in attempts to raise A$3 million (S$3.2 million) for a product that's been a decade in the works, despite what he describes as strong interest from some global carmakers. Now, after a series of fruitless investor meetings, he's heading down the inevitable path: straight to the US.

"The private sector just won't step up," said Mr Evans, 51, managing director of Sydney-based Evans Electric, which he co-founded with former Thales SA executive Bruno Lambla. "We've been pushed to the point where we're going to Silicon Valley to raise …