The Queensland government has responded to overwhelming demand for its inaugural venture capital fund by adding another $55 million. The top up to the now $130 million fund comes as the first five venture capital firms to get a share were revealed on Wednesday.
Antler, Five V Capital, Main Sequence, Mandalay Venture Partners and Salus Ventures will receive matched funding from the state’s Venture Capital Development Fund (VCDF).
The individual amounts have not been disclosed but can be as high as $20 million each. Due diligence is now being conducted on other applicants, with around $100 million of the VCDF to eventually be allocated to its matched funding stream.
The remaining $30 million will go to accelerators for Queensland startups and developing the state’s venture capital industry.
Promising startups like Gilmour Space Technologies, Safety Culture and Go1 call Queensland home, but the state’s share of Australia’s startup funding has dropped to around 10 per cent in the last two years.
The VCDF was announced ahead of the June state Budget last year as part of the solution, with initial government co-funding of $75 million on offer to lure VCs to the state.
The fund was quickly inundated with more than 50 proposals seeking more than 10 times the initial $75 million.
The VCDF is managed by the state-owned Queensland Investment Corporation and requires the VC receiving the funding to spend at least 1.25 times the amount they are allocated from the government in the state.
The first round of matched funding will also see the firms without a local presence set up new operations and partners in Queensland.
“As a result of securing a deal with the Fund, Antler, Five V Capital and Salus Ventures will appoint Queensland-based staff to spearhead local investment activity,” Deputy Premier and Treasurer Cameron Dick said.
“They join established Queensland investors Main Sequence and Mandalay Venture Partners in our renewed push to close the identified early-stage funding gap and attract even more third-party investment.
“Our total $130 million commitment will generate up to $200 million in start-up funding for Queensland’s best and brightest.”
Antler Australia Partner Mike Abbott said the matched funding will allow the firm to invest in around 15 companies over the next four years. Mandalay Venture Partners Partner Timothy Hui said having the Queensland Investment Corporation as a limited partner sends a strong signal for future partners.
The $130 million VCDF includes around $30 million to fund startup accelerators programs to grow the pool of potential investments and for development programs for the state’s venture capital industry.
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