Australian startup investment up 28 percent in 2020-21 Australian startup investment up 28 percent in 2020-21 Australian startup investment up 28 percent in 2020-21

Australia saw a continued rise in venture capital funding between 1 July 2020 and 1 July 2021, to a record US$2.5 billion, up from US$1.95 billion in the previous year, according to the latest KPMG Venture Pulse report.

The research, which captures investment in startups across the world, reported a record 327 Australian VC investment deals over the financial year, up from a 311 over the previous 12 months. 

Head of KPMG High Growth Ventures, Amanda Price commented: "The investment environment for Australian high growth ventures has never been stronger – with VC firms continuing to attract and deploy capital at a record rate. Alongside the continued progression of Australia’s new unicorns, startups that have achieved a valuation of over $1 billion, we have also seen record seed rounds raised. Startups like Honey, Nourish Ingredients and Carted have attracted over $10 million of early stage funding.”

“As we look to Australia’s post-pandemic future, the emergence of these digital disruptors have massive potential to contribute ot the nation’s economy. You only have to look at the influence of their predecessors such as Atlassian to view the positive impact of home-grown Australian tech giants, creating jobs and wealth for the country,” she added.  

Top Australian VC deals over the 2020-21 financial year included later stage rounds for established scale-ups such as Airwallex, Athena and Safety Culture. 

The past three months have seen record levels of startup funding, with $157.1B raised across 7,687 deals. In addition to regional record highs in Europe and the Americas, a number of countries saw their highest quarters of VC investment ever, including the United States, UK, Isreal and Germany. A growing number of less typical VC investors are increasing their focus on the VC market, including private equity players, pension funds, sovereign wealth funds,university endowments, and family offices

"Worldwide, the past quarter has seen capital flow into startups at record levels.” said Amanda Price. “While fintech was the most attractive sector of investment in all regions of the world, health and biotech continued to see significant investment activity, in addition to areas such as edtech, gaming and food delivery. With a significant amount of cash looking for investments, the VC market is expected to remain very robust over the coming quarters. VC investors are likely to focus on many of the sectors expected to remain attractive as the world emerges from the pandemic, with startups targeting sectors like business productivity, fintech, and logistics likely to benefit.”

Ash Pritchard
+61 411 020 680
apritchard2@kpmg.com.au