The first five fund managers have been selected to receive capital from a $130 million Queensland state government venture capital development fund.
Antler, newly established Salus Ventures, and Five V Capital’s venture arm, will set up offices in Queensland as part of the conditions for their funding. Also to be funded are CSIRO spin-out Main Sequence Ventures and Brisbane-based agtech-focused Mandalay Venture Partners. All five firms will be required to use commitments to their funds to invest in Queensland start-ups.
The state government initially allocated $75 million to set up the Queensland Venture Capital Development Fund (QVCDF) but recently increased its commitment by a further $55 million in response to wide interest in the matching funding.
Of the total of $130 million, $30 million is to be used to improve the state’s start-up ecosystem though developing accelerators and training programs. The remainder will be allocated to venture capital funds.
The private equity division of Queensland Investment Corporation (QIC) is managing the QVCDF. After calling for expressions of interest last year, QIC received enquiries from many venture capital firms which did not have a presence in Queensland.
Salus Ventures was set up early last year by Dan Bennett, the Sydney-based managing partner of crowd-funding platform OurCrowd, Marten Peck of Melbourne architecture and interior design firm peckvonhartel, and Mike Ferrari, the Sydney-based former Australia managing director of In-Q-Tel, the national security-focused investment agency for the US government.
Ferrari is managing director of the firm which is in the process of raising a first fund but has already made investments in Melbourne optical technology company Arkeus and Sydney satellite technology company HEO robotics.
The QVCDF will allocate up to $20 million to selected funds. All allocations must be matched by capital raised from other sources. Each QVCDF allocation plus 25% must be invested in Queensland-based start-ups.
An initial five accelerators are also to be supported by the QVCDF: Farmers2Founders, EnergyLab, UQ Ventures, Lumina X and 77 Venture Challenge.
QIC Private Equity Partner Nicholas Guest said the support for accelerators would help grow investment-ready opportunities in Queensland.
Programs will leverage relationships across Queensland’s university network as well as supporting founders in regional centres.
Head of entrepreneurship at the University of Queensland, Nimrod Klayman, said that through UQ Ventures the university will deliver a commercially-focused program to help close the gap for early-stage funding in the state.
UQ Ventures will use the funding to support founders to advance commercial strategies and growth through four separate accelerator programs: Digital and software-as-a-service (SaaS), Female founders, National security and dual purpose, and UQ affiliates.
Businesses selected for the programs will receive guidance to develop business skills, grow networks and develop scaling plans with the objective of preparing them to seek significant funding.
Image: The Queensland Venture Capital Development Fund is intended to promote the entire venture capital ecosystem.