MIVCC sees both side of Oz VC

Mark Carnegie, Principal, MH Carnegie & Co gave the opening keynote address, which indicated that the industry has an uphill battle ahead. "Venture isn't a good business," he said, "It's a great business once every 20 years. The cycle will turn again," and Australia will be back in favor.

For LPs, the size of funds is an issue. "We don't write $10 million checks," said Peter Lunt of VicSuper. But Andrew O'Brien of Trans-Tasman Commercialisation Fund said that funds should be looking to strategic LPs instead of supers; those who have a vested interest in the types of companies that a particular GP may be focusing on.

While the challenges were laid bare, there were also many positives for the industry. "Appetite for growth is returning," said Malcolm Thornton, Investment Director at Starfish Ventures. "2010 was a turn year; the numbers are still off, but it's much better. 2011 will continue this trend." This perspective was seconded by Brigitte Smith, Co-Founder and MD for GBS Venture Partners. "We are today able to return money to LPs, which is a good thing. Going forward, the net funds returned to LPs will continue to pick up."

The opportunity set that could make this a reality is found in several sectors - namely biotechnology (and life sciences generally), cleantech and information and communication technology (ICT). However, the catch is that exit opportunities are few without an expanded network beyond trade majors.

Where the government could help, many believed, would be in facilitating cross-border opportunity. Famous author and VC industry expert Yinglan Tan explained that Singapore, because it is small, "welcomes cross-border activity, and sets up corporate schemes with companies that could thrive there." His co-panelist Franceska Banga, CE of New Zealand Venture Investment Fund urged local governments to enact similar programs, which would both promote Australia and New Zealand as destinations for companies, and also allow existing companies to expand and grow abroad.

"We might be behind the US because we came later, but we can do this," concluded Carrie Hilyard, Partner, CM Capital. And so despite the hurdles, there are opportunities for the industry to prove itself as a powerful force behind growing companies in Australia and beyond.

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• Topics
• Venture
• Australasia
• LPs
• GBS Venture Partners
• Starfish Ventures