Australian and New Zealand enterprises raised $610 million in funding across the September quarter, as a tough economic environment and investor uncertainty limited mega-dollar deals.
Startup funding announcements collated by SmartCompany between July and the final week of September were significantly down from the $2 billion in funding revealed over the June quarter.
That disparity holds true even after removing a major outlier: April’s singularly massive $940 million investment in PsiQuantum.
With that investment put aside, funding announcements across the September quarter amounted to just 55% of the June quarter’s amended $1.1 billion total.
A total of 57 startup funding announcements graced SmartCompany over the September quarter, compared to 81 in the prior period.
The data reflects the mixed emotions expressed by Australian startup funding leaders earlier this year.
Despite what many funds describe as ample ‘dry powder’ to expend on the right startup, broad economic pressures are stacking the odds against early-stage startups and those without a clear pathway to profitability.
Notably, the figures represent capital raises announced or confirmed by startups and scale-ups;
The largest single investment of the quarter came through construction safety startup Hammertech and its $105 million raise.
Tech platforms promoting workplace safety proved to be some of the quarter’s top performers in funding terms.
The second-largest raise saw SafetyCulture accrue $75 million in fresh capital; the round came in tandem with its $90 million secondary sale, helping to establish the company’s value at $2.5 billion.
In no surprise, artificial intelligence was another clear theme throughout the period.
A dozen capital-raising startups recorded by SmartCompany raised funding on the promise of developing new AI tools, or integrating them into their startup.
They include enterprise data management tool Redactive.Ai, med-tech startup Eyeonic, and ag-tech innovator Cropify, showing the breadth of AI adoption in the startup ecosystem.
In total, $133.8 million in new capital was directed to those dozen enterprises, including SafetyCulture, which bills artificial intelligence as a key component of its workplace platform.
The persistent gap in investment between startups founded by men and women is also apparent in the September quarter data.
Of the 57 startup raises, 39, or 68%, were completed by ventures with male solo founders or all-male teams.
Solo-founding women, or all-women founding teams, made up just five, or 9%, of those funding announcements.
Mixed-gender founding teams — where at least one founder is a woman or non-binary — accounted for 13, or 23%, of the total.
By comparison, all-women founding teams raised just 4%, and mixed-gender teams 26%, of the $3.5 billion in startup funding recorded across the 2023 calendar year.
In dollar terms, mixed-gender and female founding teams raised $81.4 million over the September quarter, or 13.3% of the full $610 million recorded by SmartCompany.
Analysis by SmartCompany and Cut Through Ventures suggests around 15% of new startup capital in the first half of the year went to mixed-gender and women founders.
While the latest data shows there is a long way to go before Australia reaches funding parity, efforts to connect women founders to capital and expertise are well underway.
Among them is Sister Pitch, which this week awarded over $1 million in funding and mentorship to a dozen women-led businesses to help them scale their ventures.
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Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
