One of Australia's leading social impact investors will launch a new social club saying the rise of innovation hubs and coworking spaces do not fix real problems and can ultimately have a negative impact on their members.
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Trimantium Capital founder Phillip Kingston is heading up the targeted social movement known as the Henley Club, which will open in Sydney this week.
Henly Club differs from recently launched startup hubs such as Stone & Chalk, by operating as a private members social club, running events and offering its members networking opportunities. Mr Kingston questioned the value of startup hubs and accelerators to the community they purport to serve.
"Coworking spaces and incubators are systemically broken. They are often marred by a commercial imperative but fundamentally they do not solve a real problem," Mr Kingston said.
"There is a definitional bias in which companies that take off will leave, so members are exposed to people who not moving out, and there are negative consequences to this. There is also no perverse incentive [with Henley Club] where a big investor wants first dibs on any emerging ideas."
Melbourne success
The Henley Club runs events and workshops for its members. Sydney will be the second chapter of the club, which has been running in Melbourne since 2012.
It has hundreds of members, many of whom have become investors, board members or mentors for each other. Its main focus is on innovation and technology entrepreneurs, social enterprise and young professionals.
One example of the network benefits of the club can be seen in the rise of the New Palm Court Orchestra, which combines jazz, classical and improvising musicians and was launched by pianist, composer and Henley member Gemma Turvey.
Mr Kingston said most existing technology co-working spaces and accelerator programs had very narrow focus, and curtailed the creativity and connections required to launch genuinely progressive organisations and businesses.
"There are a lot of people working in innovation and progress. A wider community solution is going to drive more meaningful and robust change that people actually want and need than political solutions."
The club requires referrals to join and has a series of quotas including an equal split of male and female members, as well as racial and religious diversity quotas.
"Connectivity and building social capital have clear short and long term benefits," Mr Kingston said.
"There is a massive fragmentation of capital networks. This is about bringing groups of people with answers to problems together with people with connections and money to support them."
