Venture capital startup The Fund launched in Australia – TechCrunch
The bottom, the early stage investment firm focused on pre-seed and seed startups, is going Down Under for its latest expansion. The Fund was founded in New York in 2018, before also launching in Los Angeles, London, the Rockies and the Midwest.
Co-founder Jenny Fielding, who is also chief executive of Techstars New York, said the Fund was deciding new areas for expansion based on demand from the local startup ecosystem, and earlier this year it heard a group of founders and operators who wanted to launch it also in Australia.
In addition to participating in the early control towers, the Fund also creates communities of founders and other leaders of successful startups, who provide not only mentorship but also capital as limited partners. The Fund now has a network of around 400 founders and has made around 120 investments in its funds.
In each of its regions, the Fund is chaired by an investment committee of four people. In Australia, they are: Techstars CEO Todd Deacon; Elicia McDonald, director of the venture capital firm AirTree; Adrian Petersen, co-founder of AfterWorks Ventures; and former Canva Product Manager Georgia Vidler. There will be 50 people in The Fund Australia’s limited partner base, including founders of startups like Rod Hamilton of Culture Amp, Alex Zaccaria of Linktree, Kate Morris of Adore Beauty, as well as executives from Canva and Safety Culture. . Fund Australia’s LPs will help find promising startups from their networks and refer them to the investment committee for review.
The fund is targeting US $ 3.5 million and will invest in around 40 startups, issuing checks from US $ 50,000 to US $ 100,000 over 24 months. Sponsors and other members of his community around the world will provide guidance as the portfolio companies grow.
Deacon told TechCrunch that The Fund Australia’s focus on very early stage startups is important due to the growing gap in pre-seed / seed funding. It designates a StartupAus report, an Australian startup advocacy group, that angel and seed investment in Australia has plummeted in recent years, both in terms of number of deals and overall value.
The Fund’s assumption is that many start-up funds, in Australia and other parts of the world, focus on the later stages as they raise larger funds, Deacon added. This also happened in New York and was one of the driving forces behind the creation of the Fund in the first place.
“There was this gap in the seed funding. There are those two points to building a really strong community: helping the founders and then the lack of funding, which we can help address to some extent. We introduce controls early on with a lot of power to provide the founders with access to this network, ”he said.
Writing advance checks allows the Fund to see the flow of transactions before other VCs and limited partners, and small checks give it an advantage with startups.
“We’re not taking a huge proportion of their raise, but we come up with very high quality capital,” Deacon said. “We have this network of investors. Why some of our [LPs] are interested is to generate a return, but they also want to give back and grow Australian and New Zealand businesses.
Being able to tap into the Fund’s international network is useful for startups in Australia, where many companies are considering international expansion from the start.
Australian unicorns like Atlassian and Canva are also helping to strengthen the Australian startup ecosystem, Vidler said. “It sounds like an inflection point for me in the startup ecosystem, where there are now all of these original founders and a community of senior operators who want to give back and create and strengthen the ecosystem here.”
Fund Australia is independent of the sector and wishes to create a diversified portfolio. The Fund has focused on gender parity from the start. Each region’s investment committee is made up of two men and two women, around half of its LPs are women and over 40% of its total capital has gone to female founders. Vidler says it was a major draw to her.
“The attraction for me, and I think for a lot of the network in Australia, and a lot of women in tech in Australia, is that they’re also going to be very interested in investing in the next generation of founders. ” she said.