Melbourne-based venture capital (VC) firm Rampersand announced it is in the process of raising up to A$50 million for its second fund, with almost half raised. Structured as an Early Stage Venture Capital Limited Partnership (ESVCLP), Rampersand's focus in its second fund will continue to be on early growth stage tech startups.
PromisePay, a Melbourne-based startup has been the recipient of the firm's first investment, with Rampersand participating in the payment of the PromisePay's recent A$14 million Series A round, and two other opportunities at a further stage.
Cofounder Paul Naphtali said the firm is focused on this growth stage as it likes to see the commercial capabilities of startups once they're in the market. He also stated that they have an interest in backing commercial founders that have some kind of product that will fit the market.
Alongside Naphtali, Jim Cassidy founded Rampersand in 2013, counting the likes of Expert360, Skedulo, School Places, and Stackla in its portfolio. Naphtali said they took five weeks to raise their first fund of A$6 million three years ago.
There has been an increased growth of VC money in Australia, the last month or so alone has seen Start Mesh announce it is raising its first VC investment fund, looking to raise A$20 million, and Australian fund management firm Aura Group announce the launch of its A$30 million Aura Venture Fund.
Like Rampersand, these too are structured as ESVCLPs, and both operated according to criteria that allows for foreign investors to come to Australia through a Significant Investor Visa. Both Aura Group and Start Mesh have cited the tax incentives for early stage startups as a contributing factor to launch of their VC efforts.
Under these incentives, tax concessions will be given to eligible early stage investors who invest in qualifying companies. The concessions include a capped 20 percent, non-refundable tax offset, and a 10 year capital gains tax exemption on investments that are held for 12 months or more.
With regards to potential investments for Rampersand, Naphtali says the firm is not focused on any particular industry or sector, as it is more important for the firm to back a diverse range of both companies and founders.
In an effort to encourage more female founders, Rampersand has been gathering a varying degree of statistics about the companies it has come into contact with since the start of the year. It has found over the last six months that just over 13% have been female-led startups.
Naphtali believes encouraging female-led startups is the key to the growth of the local startup landscape, and that diversity is crucial to developing effective startup infrastructure.
In November the State Government of Victoria announced the establishment of LaunchVic, a new body that will accelerate startups, drive new ideas and create jobs in Victoria.
Victoria has all of the ingredients to become a global centre for startups that will provide the right environment for entrepreneurs to develop, incubate and grow early-stage innovative businesses.