Blackbird’s latest AU$1 billion fund signals maturing Australian and New Zealand venture capital scene • TechCrunch
The Australian and New Zealand startup community will see its funding increase this year. Blackbird, a venture capital fund based in the two South Pacific countries, on Wednesday closed a fund worth more than A$1 billion, or about US$640 million, which the firm says is the largest Australian funds to date.
This is Blackbird’s fifth fund, and it’s double the size of the VC’s last fund which closed in August 2020. Several institutional investors have participated, including pension funds like AustralianSuper, Hostplus, the sovereign wealth fund Australia, Future Fund, New Zealand Sovereign Wealth Funds and New Zealand Growth Capital Partners Elevate Fund, which is a government-backed fund.
A decade ago, most Australian and especially New Zealand institutional investors didn’t want to put their money near tech startups. Their support now signals a maturing of the Australia/New Zealand venture capital space.
“[Superannuation fund] capital can go anywhere. It can go to the best VCs in Silicon Valley,” Blackbird partner Sam Wong told TechCrunch. “And so the fact that they choose to invest their money on this scale with an Australian and Kiwi fund marks a moment for the ecosystem and shows that we have earned our right on the world stage to manage this capital.
According to Wong, it makes sense for pension funds to support the tech space because they have horizons in the decades and can afford to be patient.
“What they’re really interested in are high returns so people can retire with dignity,” she said. “And when you have that long-term horizon, you can look for higher-yielding assets that don’t have liquidity profiles like, say, public markets. And that’s exactly what we found in the Australian pension system – they like technology because it’s high growth, high return. It’s very old, and they don’t mind it being locked away for 10 years.
The fund is also backed by more than 270 individual investors, many of whom are founders and tech operators that Blackbird has backed through previous funds, according to the company. These founders will support the fund both with their own capital, but also with their expertise, knowledge and connections, Wong said.
The AU$1 billion total is made up of three separate vehicles: an AU$284 million (US$182 million) base fund for pre-seed and seed-stage Australian businesses, a followed by A$668 million (US$472 million) to support Blackbird portfolio companies. from “Last-Round Series A at Canva” and a dedicated NZ$75 million (US$44 million) New Zealand fund, which is also largely targeted at pre-seed stage companies and priming.
Blackbird is proud to cut early checks, which can range from $25,000 for a small pre-seed to up to $5 million for a seed round, Wong said. The firm’s mandate is to invest in founders with an Australian or Kiwi connection, which usually means they are based in those countries, but often ends up extending to those who have founded businesses there. foreign. About 40% of Blackbird’s portfolio companies are actually headquartered in the United States, said Phoebe Harrop, director of Blackbird.
The fund has already made 18 investments in startups across a wide range of industries, from AI to manufacturing to e-commerce. Last month, Blackbird invested in Sonder, an employee and student wellness company, and Spice AI, a data and AI-driven infrastructure platform.
Blackbird said it expects tech companies to contribute 20% of Australian GDP by 2032, up from 8.5% today, according to the Tech Council of Australia.
“We are here to change the culture of Australian and New Zealand ecosystems, to make a difference at a national level,” Blackbird partner Niki Scevak said in a statement.