Impact Fund Looking to Help Startups Take Giant Leap
5 June 2018 at 4:47 pm
Australia’s first 100 per cent impact fund, which invests in startups that fuse profit and purpose, is seeking new opportunities to deploy its capital.
Giant Leap, which is backed by Impact Investment Group, is the country’s first venture capital fund dedicated to tech-oriented start-ups that aim to produce superior financial returns while delivering measurable social impact.
The fund reached final close earlier this year with $15 million in committed capital from investors including Small Giants, Intrepid Travel founders Darrell Wade and Geoff Manchester, management consultant Andrew Clark, the Atlassian Foundation and clients of Ethinvest, Australia’s oldest and largest ethical investment advisor.
IIG head of venture capital Will Richardson said he was thrilled with the investors’ response, but the team’s focus was now turned to deploying its capital.
“Giant Leap is actively deploying its $15 million in capital into scalable startups that fuse profit and a mission of creating a better world,” Richardson told Pro Bono News.
“We have already backed five outstanding start-ups, are now in the process of closing three other investments and are ready to further deploy funds into other scalable, early stage businesses.”
Giant Leap’s investment mandate is to find revenue-generating business, typically valued between $2 million and $20 million, with the fund expecting to invest an initial $100,000 to $500,000 in each venture.
The investee companies must include positive social and environmental aspects, and have impact in line with three broad themes:
- empowering people through education and platforms that foster diversity and inclusion;
- sustainable living initiatives (eg cleantech energy or waste reduction); and
- health and wellbeing (such as mental health and medical innovations).
The fund has a target return of 20 per cent internal annual rate of return.
Richardson said they were aiming for a three times cash on cash return on their portfolio.
“We aim to show that being a force for good and generating above-market returns are absolutely complementary,” he said.
The fund’s four earliest investments include home delivery service YourGrocer, GlamCorner, an online platform for women to rent designer dresses, Switch Automation, which provides building management systems to assist building owners, operators and occupants to improve the environmental efficiency of their facility, and alternative delivery service Sendle.
Giant Leap also made an early-stage investment in Perx Health, which has developed a smartphone app to increase medication adherence and is currently running a pilot project with global health company Pfizer.
Richardson said they were receiving more and more interest from purpose driven founders seeking aligned venture capital support.
“Our doors are wide open and we encourage founders and entrepreneurs to get in touch by email, phone or social media,” he said.
“We also encourage founders to get in touch with us early in their fundraising process.
“The ideal partnership is one where we build up trust over time, ultimately resulting in capital investment.”