Australia’s venture capital sector has faced a series of challenges, namely the global financial crisis and retraction from the superannuation sector. Still, emerging industries like the cleantech and biomedical sectors signal promising growth for venture capital firms. Chief executive of the Australian Private Equity & Venture Capital Association (AVCAL) shares her thoughts on the current state of Australian venture capital.
MM: What trends are you tracking in the Australian venture capital industry at the moment? Are they fleeting, or can we expect to see them for awhile?
KW: Since FY 2007, venture capital (VC) fundraising has seen consecutive y-o-y declines in FY2008, FY2009 and FY2010. VC funds in FY2010 raised $168m – a large portion of this amount was raised as part of the Innovation Investment Fund (IIF) and the Innovation Investment Follow-on Fund (IIFF) rounds. Fund raising in this sector is getting increasingly difficult. The global financial crisis is partly to blame as it is more difficult now to sell assets, and assess fund performance based on market value for the purposes of raising a subsequent fund. Additionally, the growing Australian superannuation sector (the biggest investor in VC) is retracting from the VC sector partly due to their increasing inability to write smaller cheques.
To read the full, original article click on this link: An Overview of Australia’s Venture Capital Industry - Business News - Business Review Australia
Author: m.mcnamara
