Australia's OneVentures closes credit fund at $57m

The 1V Venture Credit Fund was launched in August 2018 with a target of A$100 million. It achieved a first close of A$45 million in April last year and a second close of A$60 million the following August.

The fund can recycle its principal in the first five years, which means deployment capacity is around A$120 million, or 1.5x committed capital. According to a statement, the fund was oversubscribed and was in profit as of June 30.

“OneVentures is delighted with the progress of this new fund since launch with fund metrics on deployment and interest yield paid at or ahead of expectations,” Michelle Deaker, a managing partner at OneVentures, said. “The final close was well supported with investors recognizing the product as an attractive way to get exposure to Australia’s fastest-growing technology companies at lower risk, with a strong and stable income yield.”

Investments typically range from A$500,000 to A$10 million, although there is the capacity for transactions of up to A$20 million. Target areas include B2B software, marketplaces, e-commerce, logistics, and technologies related to financial services, healthcare, and property.

Six investments have been made to date across five companies, and a seventh deal with a sixth company is currently being finalized. Recent activity includes the provision of A$3 million in credit on top of A$7 million equity investment in Sydney business intelligence software provider Phocas. This came after almost two years of engagement with the start-up.

The fund's first deal involved participation in a A$6 million equity and debt investment in Hometime, an Airbnb property management services specialist in Australia and New Zealand. Israel's Viola Group also took part. Hometime raised an additional A$6.7 million five months later from local investors AS1 Capital and NAB Ventures.

1V Venture Credit Fund was launched in partnership with Viola’s credit unit with a view to backing about 40 established domestic technology companies with strong revenue that are looking to grow their businesses or diversify funding sources during capital raising rounds. OneVentures and Viola were introduced by the Australia Israel Chamber of Commerce during a trade mission in 2017.

“Venture credit is an excellent product in this current time, providing a flexible solution for a company’s financing,” Nick Gainsley, a principal of the fund, said. “Uses of capital include scaling a business more rapidly through investment into sales and marketing or extending runway without setting a valuation which is particularly applicable to businesses that may have experienced a setback or delay in progress such as through the COVID-19 pandemic.”

This is OneVentures’ fourth fund overall. It closed its debut vehicle in 2011 at A$40 million and its second in 2015 at A$100 million. Fund III, which focuses on healthcare, closed at A$170 million in 2017. Separately, it manages A$105 million through government programs known as the Biomedical Translation Fund and the Innovation Investment Fund.

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• Topics
• Australasia
• Fundraising
• Credit/Special Situations
• Australia
• OneVentures