The Western Australian government has unlocked $150 million in private investment for the state’s startups through a new partnership with local and interstate venture capital firms.
Premier Roger Cook and Digital Economy minister Stephen Dawson revealed the seven firms chosen for the WA Venture Capital Initiative (WAVC) on Wednesday, while also tipping a further $15 million into the program.
The now $45 million in funding will be shared by Purpose Ventures, FundWA, Brandon Capital Partners, Health Translation Group, Artesian Venture Partners, Melt Ventures and Skalata Ventures.
The seven VC firms were chosen following a request for proposal in August, a process the state government said garnered interest from both domestic and international players.
WA has adopted a ‘fund of funds’ model for WAVC, whereby VC funds match the government two-to-one with private investment and spend at least 1.25 times the government contribution on local startups.
Queensland has also deployed the model for its $130 million VC attraction fund, which has brought in nine firms so far, while Victoria is also covering set up costs for eight firms to develop its VC scene.
Four of the seven firms — Purpose Ventures, FundWA, Brandon Capital Partners and Health Translation Group — are already based in WA and will now grow and expand their presence, according to the government.
The out-of-state firms — NSW-based Artesian Venture Partners, one of the country’s largest VC firms, and Melt Ventures, as well as Victoria’s Skalata — are now expected to set up shop in the state.
According to the original RFP, all firms will need to have a senior investor residing permanently in the state and have raised the two-to-one private investment within 18 months.
All seven firms are expected to target startups seeking seed to Series B funding or scaleup seeking Series B funding. Scaleup funding remains a problem area in Australia, according to a 2023 Tech Council report.
WAVC will consist of two streams: an industry and technology stream targeting the energy, defence industries, METS, space industries and international education sectors, and a future health research and innovation stream.
Premier Roger Cook said that by attracting more VC investment, fewer startups would “have to move east to secure investment, retaining talent here in WA”.
“By attracting more venture capital investment to WA, my government is growing our local start-up sector, diversifying the State’s economy and creating quality local jobs for the future,” he said.
“High-growth start-ups are proven job creators, capable of adding thousands of new positions at a faster rate than other sectors.”
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