Founders from Go1, Instaclustr back OIF Ventures in $75m raise for opportunity fund

Founders from Go1, Instaclustr back OIF Ventures in $75m raise for opportunity fund

OIF team members (L-R) David Shein, Jerry Stesel, Anna Osipov, Isabella Rich, Geoff Levy AO, David Cohen, Oliver Darwin, Laurence Schwartz, Keren Dorfan.

In what has been a busy week for Australian venture capital firms with Wollemi Capital securing $220 million for climate-focused investments and Black Nova targeting $35 million for early-stage startups, OIF Ventures is launching a new fund for technology businesses that have more than $10 million in annual recurring revenue (ARR).

Sydney-based OIF Ventures - a backer of successful tech companies such as ed-tech Go1 and navigation systems and robotics tech scale-up Advanced Navigation - has already received very strong support from existing cornerstone investors who have committed $55 million to the new opportunity fund, out of a target of $75 million.

The new fund is expected to close to new investors at the end of July.

OIF Ventures currently has three early-staged funds, the first of which has returned more than 3x to investors in cash, net of all fees, with eight portfolio companies remaining including Go1, Advanced Navigation, Kasada, and Enboarder, among others.

The firm's exit from cloud data intelligence platform in Instaclustr in 2022 delivered an almost 20x return, and the year prior OIF had exited XM Cyber, EFTsure and 50 per cent of Assignar.

These are just some of the companies in OIF's portfolio which also includes funeral industry disruptor Bare, online bridging loan fintech Bridgit, legal tech software provider Josef, and large-scale construction program dashboard Mastt, to name a few.

The new fund plans to primarily follow-on into what it considers to be the very best of its existing portfolio companies, but OIF Ventures will also consider investing in net new opportunities based on quality of management, execution to date and importantly, valuation terms considering the current market environment.

In addition to the minimum $10 million ARR threshold, the firm will be looking for world-class tech businesses with strong revenue growth, sustainable unit economics and capital efficiency and strong competitive advantages.

Critically, the fund will be investing in exceptional founders that we have built long relationships with and whose businesses we know extremely well. These businesses will typically be business-to-business (B2B) Software as a Service (SaaS) companies, marketplaces and fintechs.

OIF was the first investor in Advanced Navigation in 2016, and the latest fund has selected the Sydney-based company as its first investment.

Advanced Navigation's breakthrough Light Detection, Altimetry and Velocimetry (LiDAV) technology is being incorporated into NASA’s ongoing Commercial Lunar Payload Services (CLPS) program, and in April it opened a subsea robotics centre in Perth for its fully autonomous submersible drone called Hydrus.

Advanced Navigation's founders won the Sydney Young Entrepreneur of the Year Award last year and went on to take the coveted Trailblazer title at the 2022 Australian Young Entrepreneur Awards.

The latter is a distinction that can also be claimed by the founders of another OIF Ventures portfolio company Go1 in 2020, before they were crowned Australian Young Entrepreneurs of the Year in 2021.

Go1 co-founder and CEO Andrew Barnes has come on as an investor in the new fund, as is Peter Lilley, co-founder and CEO of Instaclustr.

Barnes says he is backing OIF Ventures because of his first-hand experience of OIF Ventures’ value-add as partners in Go1.

"Since OIF Ventures invested in Go1, co-leading our Series A five years ago in 2017 and then following-on several times, they have been very impactful investors on our cap table," Barnes explains.

"From introducing us to key senior talent, customers and channel partners, the team really do roll-up their sleeves and add material value when they choose to partner with a company.

"Also as individuals we’ve really enjoyed working with the OIF Ventures team and look forward to doing so for many years to come."

Lilley is also joining OIF Ventures as a member of the fund’s Investment Committee. He explains the firm co-led Instaclustr's Series A round in 2016 and were immensely impactful throughout the journey before its acquisition from NASDAQ-listed NetApp.

"They’re founder-focused, value-adding and everything you would want in a partner," Lilley says.

"It’s great to be backing them in this fund and through them backing the next generation of Australian technology founders."

OIF Ventures has also recently added former Xero (ASX: XRO) global head of corporate development Kevin Wilson to its team, with his sole focus on assisting the opportunity fund.

The latest raise demonstrates a healthy appetite for investment in Australia's start-up and scale-up space, as illustrated by OIF Ventures partner Jerry Stesel's comments that "while the good times weren’t going to last forever, neither will the tough times".

"With the more than decade long bull market coming to an end, we still firmly believe in the enormous opportunity ahead for the technology industry and founders over the years and decades ahead," Stesel says.

"We are excited to be able to continue backing exceptional founders building this future and our new fund allows us to do just that.

"We have designed our fund and fund size around a very strong investor base of value-adding LPs (limited partners) who can help super charge the founders and businesses we partner with so that we can focus on the founders that we back and give them the attention they deserve."

OIF Ventures’ team actively looks to add material value through mentorship, strategic advice, introductions to senior talent, customers, distribution partners and next round capital, while the firm also has significant experience and success in helping portfolio companies land and expand in the US market and specifically, with raising capital from leading US venture capital firms and investors, with whom OIF Ventures has deep relationships with.

"We are grateful for the support of the founders that we have backed and that of our investors, both new and existing. We respect the immense trust and responsibility they have given us and we work hard each day to earn that,” says OIF Ventures partner Laurence Schwartz.

"We have high-conviction in the power of founders we back to build generational teams and businesses that set the standard globally and we want to be their partner of choice – it is great to see so much support for this vision.

"When you look back on venture capital firm vintages post the dot com crash and the GFC, some of the most successful businesses and venture funds were launched in those periods.

"We’re long-term partners so despite the current challenging macro-economic environment we’re confident that great businesses will continue to be launched by exceptional founders and that OIF Ventures will be in their corner."

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