Equity Investment Attraction Fund
Invest Victoria has secured $20 million over four years from 1 July 2022 to establish the Equity Investment Attraction Fund. The Fund prioritises direct equity investments in high-growth companies of strategic interest to Victoria, which are looking to scale up their business. The Fund’s primary focus will be on attracting international or interstate startups to Victoria.
Our Investment Strategy objectives
The Equity Fund will prioritise positive public policy outcomes when making investment decisions and determining the size of any investment over a greater internal rate of return outcome. Policy outcomes sought include potential for companies to contribute to long term job creation, new IP creation in areas in which Victoria has comparative advantages, onshoring new capabilities, helping to build the foundations of new industries, assisting in supporting the commercialisation of new IP or the potential to build skills and talent in critical areas of growth.
The Equity Fund will aim to invest between AUD $1 million and AUD $5 million per investment round, which is expected to result in approximately 5 to 10 high quality portfolio investments over four years.
Invest Victoria will identify target companies for consideration under the Equity Fund with the following characteristics:
- Willingness to locate and invest large and/or critical parts of its operations within Victoria.
- Are unlisted start-ups.
- Possess novel and protected intellectual property with high commercial potential for Victoria.
- Have a strong lead investor, and
- Are in the process of raising funds.
The Equity Fund will take non-controlling minority stakes in companies and will aim to co-invest with lead institutional investors to leverage their due diligence skills.
What are our focus areas?
In terms of addressable investment universe, the Equity Fund may invest in businesses and projects that focus on one of the following key sectors:
- Health and life sciences
- Advanced manufacturing
- Clean technology
- Digital technologies
While these are the key focus areas for investment by the Equity Fund, novel and innovative proposals outside these technologies may also be considered for investment. This will depend on the technologies and their potential contribution to policy outcomes.
Decision making process
An Advisory Board, made up of experts with venture capital experience has been established to support the Equity Fund and provide recommendations to the Government on the suitability of proposed investments.
The Equity Fund Advisory Board is expected to support Invest Victoria’s efforts to secure strategic investment outcomes by utilising the board members’ experience, insights on potential investment opportunities, advice on the quality of the lead investor, and by providing guidance on key negotiations.
An independent valuation will be undertaken on each investment proposal that has been endorsed by the Advisory Board and external legal advisors will be used to negotiate the investments’ terms and conditions.
Understanding the investment restrictions
The Equity Fund will have a number of constraints with regard to the exercise of its investment function. Specifically, the Equity Fund may not invest in:
- Real estate,
- Derivatives for speculative purposes,
- Publicly listed companies,
- Tobacco or tobacco related products,
- Cluster munitions and other controversial weapons,
- Thermal coal,
- Logging of old growth forests,
- Unregulated animal testing,
- Live cattle and/or sheep exports, or
Information required to be considered
For a company to be considered it must provide the following information:
- Information about the lead investor, such as historical performance and experience
- Valuation report
- Financial statements
- Business plan
- Management team experience
- Plans for operations in Victoria
Potential investors interested in finding out more about the Equity Investment Attraction Fund should contact:
Email: Equity Fund Program Manager