Paul Bassat’s Square Peg Ventures has closed its $600 million fourth fund, bringing its total committed capital to a whopping $1.4 billion for investment into Aussie, and global, startups.
The funding also comes at the end at what has, perhaps surprisingly, been a huge year for the Australian VC space, with new funds available totalling at least $1.6 billion.
Headed up by Seek co-founder and Aussie tech royalty Paul Bassat, Square Peg made its first investment back in 2012. Since then, it’s backed unicorns Airwallex and Canva, as well as the likes of Deputy, Q-CTRL, Athena, and more recently, fast-growing medtech startup HealthMatch.
Since March, Square Peg has returned some $570 million to investors
Bassat’s focus has always been on the people behind a business. In a statement, he called the founding team “the single most important component” of any investment decision.
So, when asked what kind of businesses he and the team are looking to back next year, he says they’re not focused on any particular sector or tech. Rather, it’s about empowering the best people in Aussie tech.
“We’re excited to meet and support the next generation of people building globally significant companies, right across the ecosystem,” he tells SmartCompany.
Show me the money
In 2020, at least $1.6 billion in fresh capital has been raised by Australian venture capital funds of varying sizes with varying focuses and specialities.
At the bigger end of town, we have SquarePeg’s $600 million fund, plus a $15 million investment from CBA. Blackbird Ventures — another Aussie stalwart of the VC scene — also raised $500 million for investment into the “most ambitious and the most courageous” startup founders.
Meanwhile, OneVentures completed the final close of its 1V Venture Credit fund, bagging $80 million, before raising another $75 million for the first tranche of its OneVentures Growth Fund V.
Atlassian made its first move into startup investment, committing $70 million to invest in cloud technology companies in the ecosystem, and Aconex co-founder Leigh Jasper is also getting in on the action, teaming up with hedge fund operator Ian Beatty to launch a $30 million ‘secondary’ investment fund, offering a route to liquidity events without exiting or listing.
Just last week, Equity Venture Partners raised $50 million to close its third fund, while Aura Group raised $10 million, closing the first tranche of its first $50 million fund towards the end of November.
Elsewhere, Antler banked another $40 million to back Aussie businesses through its startup generator program, Tidal Ventures secured $30 million for investment into seed-stage businesses, and Significant Capital Ventures raised $15 million to invest into university research.
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While 2020 has been a significant year for several reasons, Bassat says it’s also seen a “maturation of the Aussie ecosystem”, with fourth-general funds getting raised and significant follow-on investments into companies. That all sets the sector up for “what will likely be a record year”, he says.
Successful businesses are now cropping up in all kinds of sectors and industries in Australia, says Bassat who anticipates seeing continued growth in historically strong verticals such as software-as-a-service, as well as increased activity in fintech, healthcare and education tech.
“This last year has reminded us of the importance and opportunity in these sectors and I know we have founders working on the cutting-edge of all three in Australia,” Bassat says.