Breakthrough Victoria has made cornerstone investments totalling $75 million in five venture capital funds that will broadly support climate technology, medical research and entrepreneurial diversity, among other tech startups across the state.
The Victorian Government’s investment arm says that all five funds have committed to allocating 25 per cent of the total capital in the fund to Victorian companies.
The funds include Virescent Ventures Fund II, SYNthesis BioVentures Fund I, Scale Venture Fund 1 and Galileo Ventures Fund II.
Breakthrough Victoria says the investments will help bring dedicated investment management expertise into Victoria, as well as leverage private capital to scale the state’s innovation ecosystem.
Breakthrough Victoria CEO Rod Bristow points out that since 2021, the state-owned investment group has leveraged more than $1.3 billion in private co-investment capital.
“This initiative will further solidify our role in the Victorian innovation ecosystem, ensuring innovative companies have the capital to grow and drive,” he says.
The latest initiative follows the release last year of Victoria’s Economic Growth Statement, which urged Breakthrough Victoria to boost its investment in venture capital funds to crowd in more private capital to the state in order to “turbocharge investment”.
Breakthrough Victoria says investment in venture capital funds strengthens its role in transforming the Victorian economy by driving successful IP and research commercialisation.
Virescent Ventures Fund II
The investment in Virescent Ventures Fund II builds on the successful track record of the first fund, which involved investing from seed through to growth stages in companies with a focus on maximising both emissions reduction and commercial outcomes.
The new fund has already invested into multiple innovative businesses, including Victorian-headquartered companies Relectrify which has developed a world-leading battery solution, and Amber Electric which helps energy users maximise the value of their solar, batteries and EVs.
Born out of the Clean Energy Finance Corporation, Virescent Ventures manages more than $500 million across two funds and has made 40 investments to date with its portfolio spanning clean energy, sustainable agriculture, circular economy and smart cities.
“Climate change is both the biggest threat and biggest opportunity of our generation,” says Ben Gust, the managing partner of Virescent Ventures Fund II.
“Australian entrepreneurs are rising to the challenge and seizing this unprecedented economic opportunity by developing world-leading technologies and business models to address these issues in incredibly smart, commercial and innovative ways.
“With Breakthrough Victoria’s support, our second fund will continue to build a portfolio of early-stage climate focused companies that drive innovation, create new jobs and power sustainable growth, while creating a better environment for future generations and playing a leading role in the transformation of the global economy.”
SYNthesis BioVentures Fund I
SYNthesis BioVentures Fund I was established in Victoria by Professor Andrew Wilks, a researcher and entrepreneur in the fields of oncology and haematology, with a mission to identify a high-potential, scientifically robust pipeline of therapeutic assets.
These can range from early discovery through pre-clinical proof of concept and into clinical studies, which leverage the team’s expertise in immunology, immuno-oncology and inflammatory diseases across multiple modalities and indications. More than 80 per cent of SYNthesis BioVentures’ investments are expected to be in Victoria.
“Our team at SYNthesis BioVentures is delighted to be one of the recipients of this significant capital allocation,” says Wilks.
“Victoria has led the way in its support for life science research, and we believe that Breakthrough Victoria has made exactly the right call by backing life science investors across the biotech capital stack.
“We find extraordinary science wherever we look, and we are keen to invest our funds and our experience into the therapeutics that lie beyond.”
Scale Venture Fund 1
Scale Venture Fund 1 is founded a thesis of backing female founders, and while it notes that women-led startups are increasing, just 3 per cent of venture capital goes to all-women founding teams, and under 20 per cent to startups with at least one-woman co-founder.
“Australia, despite its size, is a ‘unicorn factory’ with extraordinary quality and volume of innovators,” says Samar Mcheileh, founder of Scale Venture Fund 1.
“Yet, we've inadvertently missed a massive opportunity right in front of us: women entrepreneurs.
“The market inefficiency lies in the disconnect between the proven performance of women-led teams and the minimal capital they receive.
“We're excited to bridge this gap, demonstrating that by backing these founders, we can unlock significant value and drive innovation globally. The quality of ventures emerging from Australia, led by women, is truly exceptional.”
Galileo’s Fund I
Galileo Ventures is a pre-seed and seed venture capital firm backing emerging founders building new technology.
Galileo’s Fund I is a top decile fund with investments in leading Australian companies like Relevance AI, Andromeda and Tixel, while Galileo Fund II is a multi-sector, technology-focused fund investing $250,000 to $1 million into startups at their first rounds.
Galileo’s investors include leading institutions, family offices, founders and operators from Australia and the US.
“Despite the headlines, the founders keep telling me that pre-seed capital is still a mirage - plenty of talk, but little water when you get close,” says Hugh Stephens, co-founder of Galileo Ventures Fund II.
“As Australia’s leading industry agnostic pre-seed and seed fund, we’re proud to fill that missing gap for emerging ‘unproven’ founders, with almost half of our first fund deployed into Victorian companies.
“As a proud Victorian, I’m eager to see more local startups thrive, enabled by Galileo’s global connections to ensure that founders have the right tools to scale.”
First for North American healthcare investor
The fifth investment will see Breakthrough Victoria make a cornerstone investment with an undisclosed specialist North American healthcare fund manager as it launches its first Australian fund.
Established 20 years ago, the fund manager has successfully launched five new healthcare funds since, deploying around US$500 million into about 100 portfolio companies, with a global healthcare ecosystem view and focus on underserved regions.
The manager’s Australian fund will be set up in Victoria and will see its portfolio companies Australian-domiciled or have material management operations, IP or other activities such as R&D occurring in Australia.
At least 25 per cent of the portfolio must be based in Victoria, aligned to Breakthrough Victoria’s cornerstone capital.
With 69 investment commitments totalling over $480 million, Breakthrough Victoria is one of Australia’s most active early-stage technology investors.
A recent independent report by EY-Parthenon found Breakthrough’s portfolio is on track to generate $5.3 billion in economic impact for Victoria by 2035.
It also found that 88 per cent of early-stage investment in Victoria in 2024 came from Breakthrough Victoria-backed investors, and 76 per cent of all venture-stage investment in Victoria in 2024 involved the organisation.
“Commercialising Victorian research and investing in innovation are crucial for our long-term economic growth and resilience and for unlocking technologies with potential to improve our way of life,” says Danny Pearson, Victoria’s Minister for Economic Growth.
“This investment is a catalyst to significantly increases the venture capital available to support innovation-intensive Victorian companies , transforming Victoria’s economy and creating highly skilled jobs.”
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