Melbourne’s new $14 million co-working space The Dream Factory is officially open for business, and with its launch comes a $13 million venture capital fund dedicated entirely to startups with social or environmental purpose.
This week, Impact Investment Group (IIG) unveiled its $13 million VC fund dedicated entirely to startups driven to make a difference with their profits.
The Giant Leap VC fund, which targets a 20% internal rate of return per annum, will invest in late-seed to early series-A level startups addressing challenges like people’s health and wellbeing, empowerment and sustainable living.
“It’s the first of it’s kind in Australia,” Impact Investment Group chief investment officer Will Richardson tells StartupSmart.
IIG was looking to raise $10 million for the fund but the oversubscribed round indicates a growing confidence among investors to back new impact-driven ventures, he says.
Earlier this year, Impact Investing Australia found that there is an estimated $18 billion in pent-up demand for impact investing.
“It’s a real turning point,” says Richardson.
Giant Leap will be led by venture partners Peter Cameron, who is the chief executive of AVG Anti Virus Australia and New Zealand; Kylie Charlton, Australian Impact Investments’ chief information officer and co-founder of Unitus Capital; and angel investor Adam Milgrom.
Prominent Silicon Valley investor Susan Wu and other heavyweights will sit on the advisory board.
“We believe that the most successful businesses are the ones that make money by doing good, and they are the ones we are going after,” Richardson says.
“The tide is turning on business that comes at the expense of society or the planet.”
Victoria’s minister for small business and innovation Philip Dalidakis attend the launch held at Dream Factory in Footscray.
“Not only will this money help our startup ecosystem but it will help those that are dedicated to making our world better for everyone,” Dalidakis said.
Giant Leap’s first investments
Ahead of its launch, Giant Leap participated in a $5 million investment deal with Sendle, a parcel delivery platform committed to 100% carbon neutral delivery for “good businesses”.
It also recently invested $500,000 into online grocery YourGrocer.
Richardson says the fund backed these startups for their highly scalable business models, strong growth, exceptional management teams and commitment to making profit at the benefit of their communities.
Sendle facilitates 40,000 deliveries a month without adding any additional trucks to the road, he says, while YourGrocer helps small businesses like local green grocers compete against larger supermarkets.
“We’re open for business and looking for amazing founders and teams to back in the impact space,” says Richardson.
“[They] can be anywhere in Australia, we can actually invest internationally as well but we want to support the Australian ecosystem.”