Australia’s venture capital ecosystem may be bigger, more established and more cash-rich than ever, but on a global scale, it’s still got some catching up to do.
That’s according to Rick Baker, co-founder and partner at Blackbird Ventures.
Having co-founded Blackbird almost 10 years ago, before the Aussie VC ecosystem was even really a thing, Baker has seen a swift coming of age of the local ecosystem.
More and more players are emerging each year, and there’s even rivalry brewing between some of the more established players, he notes.
At the later stages, Aussie startups are also attracting the interest of international investors.
“The global firms are coming over to Australia and have well and truly discovered us,” he tells SmartCompany.
“It’s a healthy level of competition at this stage.”
Australia’s venture capital ecosystem is maturing, Baker says. Last year, some $1.6 billion was raised for investment into Aussie startups, including Blackbird’s own $500 million fund and Square Peg’s $600 million one.
And in 2021, we’re seeing that cash starting to be deployed, with multiple new unicorns emerging, and several new startup raises being announced every week.
However $1.6 billion is still “a small amount of money relative to the opportunity”, Baker says.
One marker of growth in the tech ecosystem is the very existence of unicorns such as Canva, SafetyCulture and Culture Amp — all Blackbird portfolio companies, he notes with pride.
Businesses like Go1, Octopus Deploy and Employment Hero are also raking in rounds above the $100 million mark.
Ultimately, Baker estimates more than half of the capital raised by Aussie funds is being directed into later-stage, large raises, with more going into Series B rounds and above — the $30 million or $45 million rounds.
Therefore, if you have $600 or $700 million left for deployment into what Baker calls “true early-stage” startups, that equates to one medium-sized VC in Silicon Valley, covering an entire market and all the verticals within it.
“That is small,” he says.
“There are opportunities for that to continue growing.”
In an interview for our recent case file in SmartCompany Plus, Baker explains how Blackbird has grown with the Aussie startup ecosystem, and how he and the team strive to maintain a nimble and startup-esque mindset throughout.
We also caught up with partner Sam Wong and operations manager Dan Danilov to pull back the curtain on what really goes on in one of Australia’s biggest venture capital firms.
