The Sydney-based venture capital (VC) fund that helped propel the likes of Canva and Culture Amp has recently completed its largest funding round to date, garnering a $500 million kitty to spend on the potential Antipodean unicorns of the future.
In a blog on behalf of the team at Blackbird Ventures, co-founder Niki Scevak (pictured left) said the fourth funding round took the group's total committed capital to $1.24 billion, making it the largest VC firm in Australia and New Zealand.
The news was accompanied by the announcement Atlassian co-founder Mike Cannon-Brookes has joined the board of directors as chair of the Blackbird management company.
Cannon-Brookes describes Blackbird as three things at once: "a startup, an investment firm and an incredibly talented group of people backing ambitious founders".
"I share with the team a deep belief that the world change comes from entrepreneurs who are wildly wrong, then wildly right," said Cannon-Brookes, one of Australia's richest people.
"I'm honoured to be able to help the team on their next stage of growth."
The funding round was led by local institutional investors Future Fund, Australian Super, HESTA, institutional clients of Cambridge Associates, First State Super (soon to become Aware Super) and Telstra Super, along with international backers Cendana Capital, Greenspring Associates and Pavilion Capital.
"Importantly, this means that the fruits of our portfolio's success - like Canva, SafetyCulture, Culture Amp and rising stars like Propeller - will grow the retirement savings of millions of Australians," Scevak said.
"Like the companies we invest in, we have the ambition for Blackbird to be the best in the world. As greater numbers of world-leading startups are created outside of Silicon Valley, so too will world-leading venture capital firms.
"The dynamics of venture capital are such that just a few outlier successful companies are needed to make this happen."
Scevak, who co-founded Blackbird with Rick Baker (pictured right), emphasised the fund had invested in the first and every round of Canva, Zoox, SafetyCulture, Culture Amp, along with rising stars in its portfolio such as Propeller, Baraja, Gilmour Space, Proxy, Harrison AI and nura which all are worth more than $100 million.
He added Blackbird's net internal rate of return (IRR) stood at 46.7 per cent as of 30 June post-COVID effects.
This has been possible thanks to what the company describes as the Blackbird Master Plan, taking a different approach to traditional VC models by investing hundreds of thousands of dollars right at the beginning of a company's life before there is any product or revenue.
Scevak said this helped Blackbird "earn a courtside seat to the best companies" by building great relationships, and then investing millions of dollars over their lifetimes.
"This philosophy is in contrast to the traditional model in the venture capital industry, which is currently structured around rounds of financing rather than companies," Scevak said.
"Funds [usually] invest in just the seed round or just the series A round before they know a company will be successful and then invest nearly nothing after they know it has succeeded.
"In the case of Canva, Blackbird first invested $250,000 in the very first round before there was a product and now has invested more than $165 million in the company," he said, noting this made Blackbird the largest investor in the online design platform with a 14 per cent stake.
With the fourth round, Blackbird's employees have become owners of the Blackbird management company in addition to receiving carried interest in the funds.
Meanwhile, Blackbird partners Samantha Wong and Nick Crocker have been welcomed into the partnership on an equal basis with Scevak and Baker.
"If we are going to flourish as a firm for decades, we need to empower the next generation of Blackbirds to succeed here," Scevak said.
"Just like we encourage our portfolio companies to have generous employee share schemes, we want everyone at Blackbird to be an owner of the business and share in its success.
"The coming years for Australian and New Zealand startups will be our greatest yet; the good ole days are right now."
Business News Australia
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