This report is the sixth quarterly funding report published by Techboard and the fifth with multi-state coverage. Techboard will be publishing its first annual funding report for the 2017/18 financial year later this year. That report will include a full overview of the year in Startup and Tech funding in Australia, including all funding events in the reports published for the year to date and any others that are discovered as well as detailed analysis.
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by Peter van Bruchem
Press Coverage of the Report
National Funding Overview
For the last March quarter 2018, Techboard captured the highest level of funding of any of its quarterly reports to date, having identified 142 funding events ranging in value from $5,000 to $220m, totalling a massive $952m. The growth in funding from the previous quarter of $720m was led by a 50% increase in Venture Capital (or series A, B, C etc) funding as well as some major individual funding events. New South Wales companies contributed most to the increase, but other states like South Australia also experienced significant increases in funding levels.
Highlights for the March quarter:
142 funding events recorded from all sources with funding levels nearing $1B ($952m) for the March quarter 2018.
Largest individual funding event – Splend $220m debt funding.
Largest VC investment – Canva $50m round led by Sequoia China,with Blackbird Ventures and Felicitis Ventures, giving the company a US$1b valuation and unicorn status.
Largest Acquisition – Elastagen acquired by Allergan, the maker of Botox for $120m.
Largest ICO – Havven $39m.
Largest Crowdfunding – Flowhive raised over $19m AUD on Indiegogo.
The biggest sectors were Travel (thanks to the massive debt deal for Splend, which does vehicle rentals for uber drivers) and Health/Biotech with the Fintech sector coming in third, with a reasonable drop in new funding from the previous period.
Female founded companies that received funding during the March quarter included, Canva ($50m), Agri-digital ($5.5m), Aurora Labs ($5m), Honee ($1.8m), Intimate ($4.5m), Xinja ($2.4m), Tap into Safety ($750k), Revvies ($300k), Like a Photon ($257k) and the Volte ($150k).
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Changes from our report for the December Quarter 2017
Techboard recorded a 50% jump in VC/large scale private investment, going from $200m to over $310m with the number of investments captured up from 28 to 46.
The use of initial coin offerings as a funding mechanism continued with five ICOs raising over $76m, including the biggest yet for an Australian company – Havven at $39m. This represents a similar level to what Techboard reported in the December quarter (with five ICOs raising over $73m).
Public (ASX) capital raisings were down with 15 public raisings, including 3 new listings (IPO/RTO), raising $148m, compared with 20 raisings including 3 IPOs for the December quarter ($224m).
Debt (including venture debt) was up from $180m between 3 companies to over to $224m to two companies.
Grants/awards were up from $20m to $27m.
Angel/seed was down from $21m to $11.8m.
Crowdfunding experienced a big jump from $0.5m (1 crowdfunding event recorded) to over $24m with 5 crowdfundings, including 2 equity crowdfundings (Xinja on equitise and Revvies on onMarket), and one of, if not the largest, crowdfunding events for an Australian company with Flowhive raising over $19m on Indiegogo.
Acquisitions were up from 6 to 7, including the acquisition of Elastagen for $120m, although a comparison between periods is difficult with acquisition values often being undisclosed.
Reductions in funding levels were experienced in many states but this was more than offset by the increases mainly in NSW.
The States
New South Wales
New South Wales was clearly the leading state with almost three quarters of national funding totalling $728m, representing an increase of 50% over the December quarter. New South Wales had the largest individual funding event for the quarter (Splend), the largest acquisition (Elastagen), biggest VC investment (Canva), largest ICO (Havven), largest public raise (Lendi), largest IPO/RTO (Simble) and largest crowdfunding (Flowhive) and first and largest equity crowdfunding (Xinja).
Victoria
Funding levels in Victoria dropped from $234m for the December quarter to just under $113m, with the biggest individual funding event being a public raise by software company LiveTiles for $20m. Similarly to New South Wales, the primary source of funding for Victorian startups was venture capital with 9 deals totalling over $47m, including $13m to Software company Whispir, $8m to Airwallex and $7m to Biotech Cincera Therapeutics. Initial Coin Offerings for Canya and Shping raised $12m and $8.6m respectively.
Western Australia
Western Australia experienced a significant drop in funding from almost $106m to just under $47m. Notably, funding coming into startups and tech companies via the ASX fell from $81m to $23m. Last quarter’s result in WA also included the funding of Power Ledger to the tune of $17M via Initial Coin offering (ICO) (the company’s pre-sale token generation event was reported in the September quarter). As usual in WA, the ASX played a significant role in funding with public raises accounting for over 49% of funding. The largest funding event was a $15m placement into Botanix. This quarter also saw an ICO for Bitcar which raised $8.6m.
South Australia
South Australia saw a seven fold increase in funding from the previous quarter jumping from under $7m to over $48m, with two major venture capital investments into Myriota $19.4m and the Happy Co. for $14.1m. As with Queensland, grants played a major role in South Australia with grants totalling close to $4m.
Queensland
Queensland was yet another state that saw a drop in funding from over $18m to just under $13m. Making up a large proportion of the funding for March was a significant venture capital investment of $4.8m in Movus. One notable feature of startup funding in Queensland this quarter was the prominence of Grant/prize funding (over $6.5m).
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