The Victorian government is on the hunt for a manager of its $120 million “fund of funds” which will back early-stage tech firms in the state.
The Victorian Startup Capital Fund (VSCF) was announced in last year’s Victorian budget, with $60 million allocated by the state government to be matched by the private sector.
The fund will contribute cash to Victorian venture capital funds via matched funding, and will “unlock capital” for early-stage startups by leveraging private capital.
“The fund is the first of its kind in Australia and will ensure that our founders have access to the early-stage funding they need to take their businesses to the next level,” Victorian innovation minister Jaala Pulford said.
LaunchVic has now released a request for proposal for a fund manager for the VSCF. The manager, which can be local or international but must be based in Victoria, will be responsible for raising the $60 million from the private sector, developing and implementing the investment strategy, managing due diligence and reporting on the fund’s investment performance.
The state government will be considering established fund management firms along with experienced individuals, with applications closing on 6 September.
A selection panel has been established by LaunchVic, with members including the agency’s board director Aneetha de Silva, Afterpay chair Elana Rubin, Lighter Capital chief executive Melissa Widner and Continuity Capital Partners co-founder Ovidio Iglesias.
The VSCF will be independent from the state government and make commercial investment decisions.
LaunchVic chair Leigh Jasper said startups in the state are still struggling to access early-stage capital.
“Research commissioned by LaunchVic found a $100 million per annum shortfall in early-stage capital in Victoria, and this gap has widened as a result of the coronavirus pandemic,” Mr Jasper said.
“The VSCF will be a massive boost for the Victorian startup sector, providing much needed capital to our best early-stage startups to grow and create jobs.”
The Victorian Government is also currently looking for a private manager for its $50 million venture growth fund, which will run in tandem with the VSCF. The venture growth fund will provide capital to later-stage startups in the state, with $25.75 million allocated over four years.
The fund will co-invest with institutional investors into local high-growth startups, with the government issuing a tender for the manager in April.
Both funds were revealed in the state government budget handed down late last year.
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