Powerhouse Ventures seeds new fund with $20m in assets to target space, AI and quantum computing

Deep-tech investment fund Powerhouse Ventures (ASX: PVL) is targeting investments in the space economy, quantum computing, next generation artificial intelligence and new energy with a new fund that will be seeded by $20 million in existing investments held by the company and its associates.

Powerhouse Ventures' stakes in Skykraft, Quantum Brilliance, Cirrus Materials Science, Regenco, Liquid Instruments and Urbix Resources will be among the $9 million in interests the company plans to transfer into the new Critical Infrastructure Opportunities Fund, which will operate under the Burleigh Ventures brand.

The company, which in December finalised the $1.37 million scrip-based acquisition of fellow Brisbane company Aliwa Funds Management, says the new fund will ultimately be domiciled internationally to attract “foreign and strategic investors”.

“PVL will seek to contribute its exciting high growth assets from its balance sheet in combination with similar assets from the restructured Aliwa Alpha Fund,” says the company, which eariier this month raised $2 million via a share placement to support its growth plans.

“A significant asset contribution from the chairman (James Kruger) will also be sought to cornerstone the fund.”

Powerhouse Ventures says the Critical Infrastructure Opportunities Fund will provide “unique access to the opportunities arising out of two critical global mega-trends in energy and data”, namely how humanity produces and uses energy, and how we access and compute data.

“These transformations in energy and data have a sovereign and geo-political imperative that has become more obvious in recent months,” says the company.

“This is opening the pathway for certain technologies to emerge with infrastructure-like features.

“Particular sectors where we have strong conviction that this thesis will play out is in the space economy, quantum computing, next generation AI, and materials science for on-shored manufacturing.”

Powerhouse says the company has globally relevant experience in these sectors and its strategy is to “judiciously” use its balance sheet to incubate fund strategies for the Funds Business Unit.

“We believe that this strategy will be a key enabler to grow a portfolio of unique funds products, and the size of funds under management within them,” says the company.

“This is critical to our efforts to generate for PVL shareholders a predictable annuity revenue stream.”

Powerhouse Ventures will transfer its investment positions in about nine private companies worth in aggregate about $9 million in exchange for initial units in the Critical Infrastructure Opportunities Fund, which will be led by Doron Eldar as portfolio manager and David McNamee as chief investment officer.

This will make Powerhouse a significant unitholder in the fund that the company says will be in a manner that is non-dilutionary to shareholders while increasing exposure to a larger pool of globally significant assets.

The Aliwa Microcap Fund also has set aside positions in seven private companies, including separate positions in Skykraft, Regenco and Quantum Brilliance, worth about $5 million.

James Kruger, who is Powerhouse Ventures’ executive chairman, has a significant interest in a global quantum computing company which is said to be the world’s largest integrated company of its kind with an enterprise value of more than $10 billion. He plans to sell a proportion of that position, said to be about $4 million to $5 million, at a “discount to an established arms’ length price”.

“We expect that this position has significant technology milestones to be achieved in the next 18 months and will greatly benefit the fund ahead of (Quantum Computing’s) NASDAQ listing,” says the company.

“This combined seed asset contribution of $20 million should be an enormous tailwind for the success of the Critical Infrastructure Opportunities Fund.

“In addition to the obvious alignment of the fund manager with the new and existing unit holders, these assets are in growth stage and have shown early signs of conversion to infrastructure like assets.

“Based on the maturity profile of these exciting assets, we expect liquidity events and significant step changes in value to occur for the fund within a medium timeframe.”

Powerhouse Ventures says the new fund has the potential to put the company “on the map with globally relevant and significant assets”.

The company posted an interim net profit of $2.13 million for FY25, aided by a $3.2 million increase in the fair value of investments.