Female startup founders in Victoria will have access to $10 million in angel investment under a new fund announced in the state budget today.
Treasurer Tim Pallas allocated $10 million towards the Women Founders Angel Sidecar Fund while hoping it will unlock a further $30 million in private sector equity.
The funds are part of a $186.2 million package backing Victoria’s startup ecosystem in this year’s budget, with $40 million over four years allocated to the state’s startup agency LaunchVic, and $60.5 million for Australia’s first, Fund of Funds, the Victorian Startup Capital Fund, leveraging up to $180 million in private sector investment towards early-stage funding.
The government is ramping up support for women in work and the digital economy in the 2021 Victorian budget with the Treasurer also offering $150 million in wage subsidies for businesses to hire more women.
This is so amazing to see thank you! 🙏 https://t.co/4E5bqHVn68
— Cheryl Mack (@cmack4life) November 24, 2020
The Victorian budget has $626 million to upgrade digital infrastructure and skills, with a focus on regional Victoria. That includes $250 million to co-fund business-grade broadband connectivity for Victorian suburbs and regional towns, through the Gigabit State program in conjunction with industry partners. Gigabit State seeks to address gaps in reliable high-speed fibre optic and wireless broadband services for business users, targeting communities that will benefit the most from improvements in technology.
To create more digital tech jobs, $12 million will go to establishing a flagship digital hub in Cremorne. It will be one of Australia’s leading urban technology precincts and create jobs, stimulate innovation and encourage the adoption of new technologies.
Victorians who lost their jobs during the pandemic can retrain through the $64 million Digital Skills and Jobs program, which is funding short courses and up to 5,000 industry internships to help jobseekers – with a strong focus on women – get job ready.
The $10.3 million Victorian Innovation and Digital Jobs program is designed to help SMEs adopt innovative technology.
Venture debt fund
Specifically on the startup front, the government is also getting into venture debt, a nascent part of Australian startup investment, with $25.7 million allocated towards the Venture Growth Fund, which will be run by Invest Victoria for inject late-stage capital into revenue positive startups
Will Richardson, Managing Partner of Giant Leap Fund, praised the announcements saying the government’s investment strategies are one of the most direct policy responses he’s seen towards plugging the funding gap for early stage startups.
“Not only is the government going to directly co-invest in businesses, but it’s also empowering existing funding angels and VC firms to invest more and we believe it will help drive more diverse teams in terms of gender and multicultural backgrounds,” he said.
“We’re especially bullish on how this policy will affect the impact startup space. There’s a huge interest in founding businesses that are both commercially viable and that are driving positive social and environmental outcomes.
“We have seen exponential growth in impact startups seeking investment and this funding can help create the conditions for a healthier and more resilient startup ecosystem”.
On top of that, $50 million will be offered in low-interest loans to innovative businesses including startups that undertake research in Victoria in the R&D Cash Flow Loans initiative
LaunchVic CEO, Dr Kate Cornick said: “Work is now underway to progress a detailed Business and Implementation Plan for the Victorian Startup Capital Fund, Women’s Angel Sidecar Fund and LaunchVic more broadly.”
Victoria is also tipping an extra $210 million into medical research, backing a new Australian Institute for Infectious Disease to prevent future pandemics and rapidly develop treatments at the Parkville medical research precinct. The Government will invest $155 million in the institute, with the project proponents seeking further funding from the Commonwealth Government to build the $550 million facility.
The Budget provides $16.5 million over four years towards developing treatments to address its immediate, medium and long-term health impacts of Covid-19.
A further $195.9 million goes towards establishing Digital Victoria to centralise and simplify the Victorian Government’s IT services.
Innovation, Medical Research and Digital Economy Minister Jaala Pulford said the pandemic changed the way people work and live, moving more of their daily lives online.
“This Budget will help us use and embrace new technology – and make it one of Victoria’s strengths,” she said.
“In securing our recovery, we are playing to our strengths – backing our startups, our innovators and the best minds in our medical research sector.”
“This investment in digital technology is a game-changer, particularly for regional Victoria. It means new innovation, new opportunities – and new local jobs.”
Innovation, Medical Research, Digital Economy:
Evidence tells us really big jobs growth comes from young and small companies
Start Up Capital Fund to support early stage entrepreneurs $60.5 million
Launch Vic $40 m
Women’s Angel Sidecar Fund $10 m
Venture Growth Fund $25.7 m
— Jaala Pulford MP (@JaalaPulford) November 24, 2020
COVID-19’s impact on the Victorian economy will see the Andrews government spend $49 billion in the next four years with a target of creating 400,000 jobs over the next five years.
Dale Dixon, Head of Product for Small Business at MYOB welcomed the initiatives.
“In particular we’re pleased to see the goal to create 400,000 jobs by 2025, incentives to help businesses cover the wages of 10,000 new workers and investment in new technology to provide digital accessibility for more Victorians,” he said.
“The voucher system to encourage regional tourism will also provide a boost for operators who have been hit hard by COVID travel restrictions this year.”
But the spend will see the government net debt hit $155 billion within three years, around 28% of the state’s GDP. It’s the sixth budget for Treasurer Tim Pallas.
— Cherelle Murphy (@cherellemurpfry) November 24, 2020
Victoria was hardest hit by the pandemic which resulted in a second major lockdown last several weeks. After nearly 800 deaths and more than 20,000 infections, the state is only now completing its reopening program.