Boab AI: The Melbourne Startup Behind Australia’s Government-Funded AI Adoption Push

In 2021, Boab AI launched in Melbourne as Australia’s first AI-focused scaleup accelerator. Four years later, it’s operating a $3.98 million federal government program to get ordinary small businesses using AI. Same company. Same MD. Different mission.

That’s the Boab AI story.

From accelerator to adoption centre

When Boab AI launched in February 2021, the brief was clear: back Australian AI companies that already had product-market fit and needed growth capital, not idea-stage funding. The program targeted 32 AI scaleups over four years, offering a minimum $300,000 per company and up to $5 million in follow-on funding from Artesian, the Melbourne VC firm that backed the program. LaunchVic, the Victorian Government’s startup agency, put in $1.5 million at launch. Another $8 million came from private capital.

The pitch was sensible. Australia had plenty of seed-stage support for tech founders. What it was missing, Boab’s MD Andrew Lai argued, was a growth-capital layer. “What’s really lacking is growth capital,” he told InnovationAus in 2021.

The first cohort included five companies: PI.EXCHANGE (a machine learning platform), Remi AI (demand forecasting and supply chain), Strongroom AI (digital medtech), Plaetos (employee engagement software), and Daitum (prescriptive analytics). Sector-agnostic, enterprise-leaning, all genuinely AI at the core.

Then the world changed, and Boab changed with it.

By 2024, the Federal Government was running its AI Adopt Program, handing out grants to organisations that could help Australian SMEs start using AI in their day-to-day operations. Not building AI. Not investing in AI companies. Adopting AI for practical, operational productivity. The grant recipient for one of those programs: BOAB AI PTY LTD. Grant value: $3,983,254.

The program is called SMEC AI. Boab AI is the organisation that runs it.

Andrew Lai

Andrew Lai has been building Australian technology infrastructure since well before AI was a mainstream concern.

He spent seven years at MLC in risk and analytics, then left to found FinTech Melbourne, now one of the country’s larger fintech networks. From there he co-founded SproutX, Australia’s first agtech accelerator and VC fund, and ran it as Managing Director. After that, a stint as Deakin University’s Ventures Director, managing the university’s portfolio of spinoff companies. Then Boab AI, from around 2020.

The pattern is consistent: find an underserved niche in Australia’s technology sector, build the infrastructure around it before the mainstream catches on, move to the next gap. Agtech before it was obvious. AI scaleup funding before anyone else had a dedicated program. SME AI adoption when that’s where federal attention landed.

His public comments in mid-2026 read like someone watching international adoption rates and not liking what he sees. “China’s national generative AI adoption rate hit 42.8 per cent in December 2025, up more than 25 percentage points in a year,” he wrote in IT Brief. “While Australian SMEs are understandably asking whether AI is safe, the businesses they compete with internationally are quietly compounding 20 and 30 per cent efficiency gains.”

That’s the pressure SMEC AI is built to address.

The Boab Global AI Fund

Alongside the accelerator runs the Boab Global AI Fund, a $100 million VC vehicle targeting around 150 AI companies both domestically and internationally. The fund is managed by Artesian, with Boab as the program brand.

The accelerator cohort (the 32 Australian scaleups) is one investment stream. The broader fund casts wider, including international companies. The logic is partly portfolio diversification, partly about pulling global AI thinking into the Australian market rather than waiting for it to arrive on its own.

By Boab’s own reporting, the Scaleup Program has delivered 200% or more investment uplift for portfolio companies, with $16 million flowing directly from Artesian funds to portfolio companies beyond the initial Boab investment. Named investments include Katonic.ai, a no-code generative AI platform.

The fund’s $100 million target was announced in 2021. How much has actually been raised and deployed is less clear from public information.

The SMEC AI connection

SMEC AI is Boab AI’s government-program arm. The full name is the Small to Medium Enterprise Centre for AI, and the relationship is structural: BOAB AI PTY LTD is the legal entity that holds the Federal Government AI Adopt grant. SMEC AI is the delivery vehicle.

Andrew Lai is Managing Director of both.

Boab AI’s website (boabai.com) redirects to a near-blank placeholder. SMEC AI’s website (smecai.au) has been the public-facing presence. The partners are the same organisations Boab AI works with in its accelerator work: Artesian, Cremorne Digital Hub, University of Melbourne, RMIT, La Trobe University, Victorian Medical Hub, TNG, and Rockwell.

The shift from funding AI companies to helping small businesses adopt AI looks like a pivot. Lai would probably call it a logical extension. The accelerator funded the builders. SMEC AI helps the users. Both sides of the same problem.

A full profile of SMEC AI is here: https://smallbizai.au/smec-ai-the-government-funded-program-helping-australian-small-businesses-actually-start-with-ai/

Partners

Artesian is the anchor. Australia’s most active early-stage VC, with over 600 investments and $1 billion under management, Artesian is both the investment manager behind Boab AI and a partner in the SMEC AI program.

Cremorne Digital Hub is Melbourne’s government-backed tech precinct in Richmond, and one of the program’s operational homes.

The universities (Melbourne, RMIT, La Trobe) bring research depth and talent pipelines. The Victorian Medical Hub connects to the medtech thread running through several of Boab’s accelerator investments.

Why it matters for Australian small business

There’s a reasonable argument that government AI adoption programs don’t work: too much bureaucracy, not enough commercial reality, the wrong people explaining AI to the wrong audience.

Boab AI is a different kind of bet. This is an organisation that started by investing real capital into Australian AI companies, backed by a serious VC firm, and then won a government contract to run the national SME adoption program. The people running SMEC AI aren’t civil servants who attended an AI workshop. They’re practitioners who’ve spent years working directly with AI companies.

Whether that makes a practical difference to a small business owner trying to figure out which AI tool to try first, the SMEC AI program’s results will eventually answer. But the structure is more credible than the alternatives.

Lai’s framing from mid-2026 sums up the urgency: “The risk this country is running is not that it adopts AI too quickly. It is that we hesitate ourselves into irrelevance while the rest of the world keeps moving.”

That’s not a comfortable line for any small business owner to sit with.

More on the Australian AI network: Australian AI Companies →

Website: boab.ventures | HQ: Melbourne, Victoria | Founded: 2021 | MD: Andrew Lai | Backed by: Artesian Venture Partners, LaunchVic | Fund: $100M Boab Global AI Fund | Federal AI Adopt grant: $3,983,254

Sources

1. InnovationAus — “Vic Govt funds Australia’s first AI program” (February 2021)
2. SmartCompany — “Victoria’s scale-up AI accelerator could be a catalyst to industry growth, says Andrew Lai” (February 2021)
3. Australian Government — AI Adopt Program grant recipients
4. IT Brief — “Businesses urged to adopt AI deliberately” (July 2026)
5. Dynamic Business — “What the Prime Minister’s AI address means for business” (July 2026)
6. Artesian Venture Partners — Andrew Lai bio
7. Bass PR — “Boab AI Announces First Cohort” (November 2021)
8. LaunchVic — Sector Analysis

Part of our Australian AI Companies guide.

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Sources

• boab.ventures
• AI Adopt Program grant recipients
• “What the Prime Minister’s AI address means for business”
• “Businesses urged to adopt AI deliberately”
• Sector Analysis
• Andrew Lai bio
• “Boab AI Announces First Cohort”
• “Vic Govt funds Australia’s first AI program”
• “Victoria’s scale-up AI accelerator could be a catalyst to industry …