This fund for emerging companies has raised $45 million to date
The fund has backed fintechs including Openpay and Splend.
Specialist investment bank Investec has today announced the close of its Investec Emerging Companies (IEC) fund, which has so far raised $45 million to invest in emerging and high-growth companies.
The fund, of which Investec is the largest investor, also includes other high net worth individuals, family offices and investors. It provides between $3 and $5 million worth of growth capital to companies based in Australia and New Zealand. Companies that have received backing so far include buy now pay later provider Openpay and rideshare car financier Splend.
The fund does not invest in startups but rather looks for investment opportunities in early-stage companies valued between $10 million and $200 million. Through its global network, IEC is also able to help the companies expand locally and offshore.
"Investec has recognised that emerging companies are a growth sector globally and we are covering this space on a coordinated basis with our peers in each of our key geographies," said head of IEC David Phillips.
According to the Startup Muster 2018 survey, 49.2% of startups are currently trying to raise funding. Out of all 3,476 responses to the survey, 29% of startups had raised funds through private equity in Australia. The average age of the startup surveyed in 2018 was 36 months.
"IEC was established to offer a single point of contact for founders and their early stage – what we call emerging – companies looking to access capital, advisory services, or general corporate connectivity," said Phillips.
"Investec's experience and broader connectivity, as well as our international reach, can make all the difference to a company at that stage of its lifecycle, and often this can be just as important as the capital we provide."
Co-manager of the IEC fund Hein Vogel said it was important to find the right opportunities, but that Investec was founded by a group of entrepreneurs and so this has remained ingrained in their culture.
"We are selective about who we partner with and offer bespoke solutions to each of our clients, spanning across capital, advice, and connectivity. We think Investec is truly an entrepreneur in service of entrepreneurs," he said.
The fund will remain open for further applications and will target a final close in the coming months.