Analysis Shows Mixed Growth of Ventura Capital for Australian Startups

A business meetingVenture capital investors poured more money into Australian startups in 2017, when investments rose 1.4 percent year over year to more than $555 million, according to a KPMG analysis.

However, the Venture Pulse showed that the number of venture capital transactions had dropped 27 percent in the same comparable period. For companies that want to expand, seeking a business broker for franchise opportunities could be an alternative plan.

Quarterly and Yearly Increase

KPMG said that startup enterprises in the country sealed 17 investment deals worth $121.55 million in the fourth quarter of 2017. These included IR Exchange’s $30 million contract, a more than $25 million investment in Airtasker and Spaceship’s almost $20 million transaction.

For the entire year, the number of venture capital deals slid from 185 in 2016 to 135, according to the analysis. Still, the increase in ventural capital funding indicates that investment in new companies has matured in recent years, according to Amanda Price, Head of KPMG High Growth Ventures.

She expects that the fewer number of deals represent a “temporary shift” instead of a “major structural change,” as venture capital still plays an important role in the startup segment.

Attractive Sectors

Price said that the healthtech, biotech and autotech comprise some of the most popular investment destinations for venture capital firms in 2018. As long as innovative technologies such as artificial intelligence are applicable, the startups in these sectors will continue to attract investors, she added.

Aside from angel investors, startups may pursue crowdfunding initiatives to raise equity due to the decline in seed funding, according to FinTech Australia CEO Danielle Szetho. The Australian Securities and Investments Commission recently granted a licence to first seven crowdfunding companies in the country.

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Startups now have more options to secure funding compared to previous years. How do you intend to fund your company’s expansion plan?