More than $160 million is set to be injected into high-potential start-ups as part of the Federal Government’s Innovation Investment Fund.
Innovation Minister Senator Kim Carr says the money will be made available through four major fund managers.
Carnegie Venture Capital, MRCF, Southern Cross Venture Partners and Start-up Australia will each receive $20 million to help new companies commercialise their research and introduce a host of new products into the economy.
On top of the government’s $80 million investment, the four funds will also receive funding from private investors. These investors will have to match or exceed the government’s funding, bringing the total amount invested to more than $160 million.
Carr says each fund has its own focus. For example, MCRF will focus on spin-outs from medical research institutes, and Carnegie Venture Capital will look at internet and new media technologies.
Start-up Australia will focus on early-stage life science companies, while Southern Cross Venture Partners is all-encompassing in its approach.
Previous success stories from the Innovation Investment Fund, which began in 1998, include a market-leading pain management product and an autoimmune disease treatment.
The funding decision is based on the recommendations of Innovation Australia, following an assessment process.
Innovation Australia chairman David Miles says companies are selected on their high-growth potential at the early stage of their development.
“By providing capital and expertise, venture capital fund managers are able to build and improve companies with the aim of increasing their value and providing returns to investors,” Miles says.
“Government programs such as the Innovation Investment Fund have been vital to the establishment and success of a number of funds supporting fledging new companies.”
“They have enabled Australia to go from a virtually non-existent venture capital industry two decades ago to one that has several active managers with a proven track record and numerous successes.”