Funding boost for start-ups

At least $200 million will be invested into early-stage, high-growth Australian companies by three new venture capital funds supported by the federal government’s Innovation Investment Fund (IIF).

Announced by the Minister for Climate Change, Industry and Innovation, Greg Combet, at the end of March, three new funds selected under the latest tranche of the IIF will match $100 million of government funding dollar for dollar.

The three private-sector investors include Carnegie Venture Capital, who will invest $40 million, GBS Venture Partners and Innovation Capital Associates, who will invest $30 million each.

The IIF is a venture capital program that supports new innovation funds and fund managers with expertise in early-stage venture capital investing. Through co-investment of government capital with private sector investment, it provides small and medium-sized enterprises access to venture capital, enabling them to grow and ultimately to commercialise research outcomes.

As well as providing equity capital, the fund managers provide management expertise to a whole range of promising companies across the economy.

“Venture capital helps turn ideas into successful businesses and new jobs. It is a vital part of our innovation system which is why the government, as part of its Plan for Australian Jobs, has announced a new $350 million round of the IIF program,” said Combet.

The IIF commenced in 1998. Over three rounds it has established 16 funds and has co-invested in more than 100 new companies including Seek, Bionomics, Pharmaxis and Benthic Geotech.

For IIF Round 3 Tranche 4 at least $200 million of new capital will be invested in start-up businesses.

More information on the IIF program is available at the AusIndustry website.