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Nothing ventured, nothing gained as VC investment in Australia climbs

13 June 2017

A new report estimates that venture capital investment is $1 billion this financial year providing vital funds to commercialise cutting-edge research and drive new areas of growth and jobs.

The Minister for Industry, Innovation and Science, Senator Arthur Sinodinos, today will launch the Australian Private Equity and Venture Capital Association Limited (AVCAL) report, which paints an encouraging picture for venture capital in this country.

The report highlights that Australian venture capital funds raised a record $568 million in 2015‑16.

It also revealed that venture capital funds invested $347 million in the same period—up 50 per cent on 2014–15.

According to the report, Australian venture capital funds are estimated to have raised some $1 billion in 2016–17, with institutional investors making sizeable capital contributions.

These are encouraging signs but, as AVCAL’s report makes clear, more needs to be done to encourage investment—that’s why the Australian Government is taking action to address this issue.

These results vindicate the Prime Minister’s focus on innovation, which is a key priority for the Government.

We have introduced a range of measures under the National Innovation and Science Agenda to facilitate greater levels of early-stage equity finance in Australia.

These include tax incentives to investors in high-growth potential startups, and new and less restrictive arrangements for Venture Capital Limited Partnerships and Early Stage Venture Capital Limited Partnerships.

The Government has also passed new laws to enable Australian companies to access crowd sourced equity funding to develop their innovative ideas.

The Government’s CSIRO Innovation Fund will invest in start-up and spin-off companies translating publicly-funded research into commercial outcomes.

And the Government has also launched the $500 million Biomedical Translation Fund, which is providing crucial capital for the commercialisation of biomedical discoveries.

AVCAL’s report draws attention to the crucial role venture capital plays in driving innovation.

Venture capital needs to be generous and at scale in order to foster the growth of productive and competitive businesses that can compete on the world stage.

This is increasingly important as Australia transitions to a more diversified, knowledge-based economy and seeks to unlock new sources of growth.

Media Contact: Minister Sinodinos' office 02 6277 7070