Sequoia Southeast Asia leads Series C for Australia's Shift

It is unclear which Sequoia entity, if any, has jurisdictional authority over Australia. Sequoia China has participated in rounds for the likes of Airwallex, Canva, V2Food, and Propeller Aero while Sequoia India made its Australia debut in 2017 by leading a Series C for healthcare marketplace HealthEngine.

The Southeast Asia team was established a decade ago as an offshoot of Sequoia India and both geographies received capital from a single fund. Last year, the firm closed its first dedicated Southeast Asia fund on USD 850m. This was raised in parallel with a USD 2bn India-focused vehicle.

Shift was founded in 2014 by Jamie Osborn, a former investment banker, who observed a digitalisation-driven improvement in customer payments experience and wanted to do the same for business customers. The company claims to provide a real-time view of the financial position of a business, enabling “dynamic limit setting and enhanced credit modelling.”

Its technology platform underpins a product suite that includes term loans, business overdraft facilities, equipment and vehicle financing, and trade accounts for managing supplier payments. Term loans – for borrowers with a track record of at least three years – are capped at AUD 1m with an up to five-year tenor and an interest rate of 12.95%-21.95%. Repayments are weekly or monthly.

Shift has provided more than AUD 2bn in tailored financial solutions to date and the Series C follows a AUD 140m increase in its debt funding capacity. Funding and revenue have grown by more than 50% in each of the last three years. The company has been profitable for the last five years and generates more than AUD 100m in annual revenue, according to the Australian Financial Review.

The Series C – which also featured unnamed existing investors – will be used for product development. Shift expects to maintain its strong growth trajectory in 2023 as companies continue to grow and adapt to a changing business climate.

“While large corporates can access financing based on their income or cash flows and consumers can access financing via credit card or personal loans, many businesses in Australia have to rely on mortgaging their homes or vehicles,” said Rohit Agarwal, a principal at Sequoia Southeast Asia, in a statement.

“More than AUD 3trn is outstanding in credit to businesses and more than 90% of it is backed by real estate or automobile. Shift is solving this by providing smart finance solutions - credit anytime, anywhere - to millions of businesses using data and technology.”

Sequoia’s participation demonstrates confidence in the broader Australian venture capital ecosystem, which has witnessed a drop in growth capital funding as overseas investors have abandoned the market. In 2022, early-stage technology investment reached USD 2.5bn, up from USD 2bn in 2021, but growth-stage activity fell from USD 2bn to USD 796m, according to AVCJ Research.

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• Topics
• Australasia
• Financials
• Technology
• Expansion
• Southeast Asia
• Australia
• Sequoia Capital
• Fintech