Startupland’s biggest spenders: Australia’s most active venture capital firms revealed
Thursday, April 18, 2019/
A new set of data from venture capital firm Artesian has revealed the most active VCs in the Australian startup scene, both by the number of investments and by the amount invested.
The data was collated by Artesian’s data analytics arm Decoded, with partner Jeremy Colless telling StartupSmart the figures were sourced from Decoded’s personal data, along with public announcements and press releases.
Publishing the data itself is also a way of gathering fresh figures “because as soon as we publish it everyone rings us and complains it’s wrong” Colless laughs.
“We then tell them to send us updated data so we can fix up the numbers,” he says.
Colless says the need for Artesian to do that is an indictment on the “terrible” state of data availability for Australian startups, though he notes his figures aren’t guaranteed to be correct due to some firms keeping their investment figures close to their chests.
The data, which Artesian has also displayed in a scatter plot graph, reveals Brandon Capital has dished out the most cash by a significant margin, most likely due to the investment firm’s management of the government-aligned Medical Research Commercialisation Fund, which has near $500 million in capital.
Following that is another medical and science investment firm, GBS Venture Partners, and Artesian itself. Major VC powerhouses Blackbird and Airtree round out the top five, with about $480 million and $310 million invested respectively.
On the number of investments side, Artesian leads the field by a massive margin, having made a total of 225 investments over the fund’s life. This is due to its unique, early-stage approach which sees it invest small amounts ($50,000 to $100,000) in numerous early-stage companies, often through partnerships with accelerators and incubators.
Colless says Artesian pursues this approach for many reasons, believing the VC scene is bifurcated into two clear areas: early-stage and late-stage investment.
“We see our role as ecosystem building, as there’s never going to be a late-stage VC industry if there’s not a good base of companies to build off. Plus, the larger the base, the more potential exits,” he says.
“And at the early stage, it’s critical to have a broad base, as there’s going to be a lot of failures. Our investors see us as somewhat of a platform for late-stage co-investment, we’re almost acting as a white-labeled platform for scaling early-stage companies so our investors can do late-stage investments off the back of it.”
The data from Artesian covers about 1,200 investments and tallies up to nearly $6 billion in investment, though some of those have been invested in by more than one company. Colless says working off the estimation there have been about 1,000 startups invested in, he says Artesian has participated in at least 20% of those investments.
In terms of leading the pack in both amount and number of investments, Blackbird VC takes the crown, having invested in 124 startups with a total of $482 million invested, which includes all of the firm’s investments through Startmate.
Reflecting on the VC industry, Colless says the rapid maturing of the scene is “incredible”, noting three years ago only two or three VCs would’ve had more than $200 million invested, with the number now sitting at 13.
“Three to five years ago a lot of VCs were also quite agnostic and would invest in any strong-looking tech companies. Today we’re starting to see firms specialise into different industries, which is a sign of a maturing market,” he says.
From the frontlines
Five critical questions: Are you listing your startup too soon? Lisa Schutz Verifier founder
Ignoring your ‘obnoxious roommate’: What this founder learnt when she met Arianna Huffington Michelle Gallaher ShareRoot CEO
Sex appeal, runways and mature markets: Everything Guy Pearson learnt during his $26 million Series B raise Guy Pearson Practice Ignition CEO
Barriers from the outset: Why the government’s Boosting Female Founders Initiative is unlikely to succeed Laura Keily Immediation founder