Venture capital investment in Australian start-ups continues to increase, posting its second largest-ever volumes in the September quarter, according to a prominent index tracking investment levels.
KPMG’s quarterly Venture Pulse recorded its second-highest ever level of investment in Aussie start-ups in the September quarter of 2018, with venture capitalists investing $316.8 million.
That was an increase of around $110 million on the previous quarter, and accounts for almost half of the total amount invested for the whole of last financial year ($630.01 million).
The trend since the collation of data began six years ago has been upwards, but not without a slight dip experienced in 2015 and 2016.
In the last six months of 2012, just $64.7 million was recorded in venture capital funds going to start-ups.
In 2013 – the first full calendar year for which data is available – the figure was $276.71 million. That compares to $565.99 in 2014, $495.62 in 2015, $534.92 in 2016 and the $576.08 million recorded for 2017.
So far in 2018, the amount of venture capital flowing into local start-ups stands at $692.73 million.
The highest quarter of investment remains the $340.32 million invested in the June quarter of 2014, which had been a blip in the series compared with surrounding quarters – likely driven by some unusually large individual deals.
According to KPMG’s figures, five of the eight biggest financial investments related to business productivity – particularly the use of artificial intelligence – as well as educational or financial software.
The large accounting firm said that Australia stands well-placed to capitalise on the global inflows of venture capital to start-ups.
During the quarter, the Asia-Pacific region accounted for eight of the top 10 deals finalised.
Amanda Price, head of high growth ventures in Australia, also noted that the 10 largest deals in Asia amounted to a staggering $8.2 billion, helping the region hit a record high level of venture capital investment before the year is even finished.
Earlier this year, venture capitalist and author Jamie Pride opened up to My Business about what excites him and what turns him off when entrepreneurs are pitching for investment.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.