AirTree leads $19m investment in Australia's Prospa
AirTree Ventures has led a A$25 million ($19.2 million) investment in Australian financial technology company Prospa.
It follows a A$60 million investment in 2015 by AirTree, The Carlyle Group, Ironbridge Capital and Entree Capital, which also provided the seed and Series A rounds. It was structured as a securitization of issued loans. Prospa is said to have raised more than A$100 million to date.
According to The Australian Financial Review, the deal values the company at A$235 million. The capital is expected to allow for a doubling of the 120-strong staff as well as support technology development and expand product distribution.
Prospa claims to lead Australia’s small business lending space with about a 51% market share. It uses proprietary technology via an online platform to approve loans and provide funding within 24 hours. Since 2011, it has facilitated some 10,000 small business loans valuing more than A$250 million and established partnerships with domestic bank Westpac, accounting software company Reckon and home loan services provider Mortgage Choice.
"This is a coming of age of the fintech sector in Australia,” Craig Blair, managing director at AirTree said in a statement. “Prospa is a real business solving a real problem, winning awards with tremendous customer and market feedback while achieving profitability from the very early days.”
VC investment in Australian fintech is relatively nascent. KPMG estimates that deal volumes have fluctuated between 15-18 transactions per year since 2013. Capital invested peaked at $175 million in 2015 after the launch of a fintech start-up hub in Sydney and fell to $71 million last year.
AirTree has backed about 35 since 2014 and achieved 17 exits estimated to value A$525 million in total. It was said to have raised Australia’s largest-ever VC fund last year with the close of a A$250 million vehicle focused largely on software-as-a-service and marketplace business models.
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