Victoria tempts more VCs to set up shop with new grants


The Victoria government is offering venture capital funds and angel groups up to $300,000 to set up shop in the state, in a bid to unlock more early-stage funding for local startups.

LaunchVic, the state’s startup development agency, launched the Angel Network Grant alongside the third round of its VC Support Grant – which has already helped eight VC establish a presence in Victoria – on Wednesday.

The programs are designed to unlock private capital to help startups scale and overcome stagnation in early-stage funding, an ongoing concern for LaunchVic chief executive Kate Cornick.

“Just 10 per cent of total venture funding was invested into Victoria pre-seed stage companies in 2024,” she said, adding that the focus was on “unlocking more capital for early-stage Victoria startups by fostering an expert and active investment community”.

Melbourne

Australia startup funding remains a shadow of what it was at the peak of the VC boom but Cut Through Venture latest quarterly report shows strong activity in early-stage deals in the September quarter.

To be eligible for the two grants each offering $300,000, VC funds and angel groups need to be ‘brand new’ or ‘new to Victoria’, meaning they can already have presence in other states.

VC funds must be aiming to raise at least $10 million, while angel groups are expected to unlock at least $2 million in private capital.

The funding can be used to cover establishment costs, such as legal fees and company registration, as well as support new staff salaries and facilitate capital raising, Dr Cornick said.

In August, LaunchVic announced $2.4 million (or $300,000 each) for eight VC funds, including Flying Fox Ventures, Mandalay Funds Management and New Zealand’s Pacific Channel, through the VC Support Program. They aim to raise $300 million.

It came just months after Queensland was able to lure nine firms through its $130 million VC development fund was able to  the state over the last year. Since then, the Western Australian government has also set up a similar program.

LaunchVic has also helped bring 10 angel networks to Victoria since 2020, collectively tipping $29.3 million into Victoria startups in the years since. One of the angel networks, Birchal First, invested close to $2 million in startups within 90 days of its launch.

The VC Support Grant and the Angel Network Grant Round will close on 31 March, with an information session to be held on 12 February. Successful applicants will be notified by 15 May.

Do you know more? Contact James Riley via Email.

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