A group of successful Australian technology entrepreneurs have set up a founders’ fund which plans to invest $50 million in developing technology companies.
More than 15 founders of “unicorn” start-ups have committed to Glitch Capital’s first fund. They include Go1 co-founder Andrew Barnes, A Cloud Guru co-founder Sam Kroonenburg and former Aconex chief executive Leigh Jasper. Another 45 investors are from technology companies such as Mr Yum, Employment Hero, Xero, Ofload, Fresho, Leonardo AI, Pet Circle and Zeller. In total, 70% of the cash raised by Glitch has been committed by start-up founders.
Since the latter half of 2022, gaining commitments for venture capital funds has become a lot harder as institutional investor allocations to the segment have reduced. This has led to start-up founders increasingly seeking investment from individual investors, typically starting with the founder community.
Jasper came up with the idea of establishing an Australian founders’ fund with Ryan Fitzpatrick who works alongside him at his family office Saniel Ventures. Fitzpatrick will be managing partner of Glitch, with Jasper chairing the investment committee.
With Saniel as the cornerstone investor, it took less than six months for Glitch to raise its initial fund.
The Glitch team plan to invest in companies that are generating annual revenue in the $2 million to $10 million range and expect to be supporting rather than lead investors in most rounds.
The firm’s first investment has been made in Melbourne software company Cadmus which offers an online assessment platform for higher education sector customers.
Jasper said the name Glitch was chosen for the founders’ fund because, as founders, all the investors had made mistakes.
“We make mistakes day in and day out,” he said. “We want to bring that experience to the companies we invest in, to help them navigate all the challenges and the opportunities they have on their journey.”
Kroonenburg said: “What’s been missing in venture capital in Australia and New Zealand is just access to strong performers who have been there and done this before. Now that is here, the point behind Glitch is to bring those people together and give new founders access to that experience and talent.”
Image: Glitch team members, investment committee chair Leigh Jasper; investment principal Jo Lanyon; investment committee member Sam Kroonenburg; and managing partner Ryan Fitzpatrick.