Australian venture capital (VC) firm Square Peg Capital, that is among the early investors in ride-hailing app Uber, has closed its debut fund at A$234 million ($180 million), beating its original target of A$200 million.
The Australian superannuation fund Hostplus is the largest limited partner (LP) in the fund, with a contribution of $50 million, with other LPs being entrepreneurs and HNI (high net worth individuals).
Square Peg was established by Paul Bassat in 2012, who co-founded online employment advertising firm SEEK in 1997, and its other co-founders are Barry Brott and Tony Holt.
Brott’s experience lies in early-stage investments gained through working across the venture portfolio of Jagen Pty Ltd, a Melbourne-based family office, as well as a background in corporate strategy and corporate development. Holt’s background is in investment banking and corporate finance.
The VC firm was formerly structured as a collective rather than a fund, which will be targeting investments in Australia, Israel and Southeast Asia. According to media reports, the decision to become a venture fund was due to its deal-by-deal approach becoming more complex as demand for deals rose.
It will be targeting investment in technology businesses, with a concentration on those in the consumer and mobile internet space. It will also consider investments in online marketplaces, Internet of Things (IoT), enterprise software and Software-as-a-Service (SaaS).
Current portfolio ventures include US-based payment processing enterprise Stripe and the Sydney-based online design firm Canva.
“We are really happy with the size of the fund, and we think it gives us good firepower to have a nice spread of investments. We don’t see raising a fund as an achievement in itself, but it obviously gives us capacity to back some great founders and deliver great returns for our investors,” Bassat explained in a statement to the Australian Financial Review.
Australia VC sector has experienced a resurgence in recent years, recovering from the Internet bubble bursting in the early 2000’s. In recent years, Australia has seen the establishment of a $250 million fund by Airtree Ventures in 2016 and a $200 million fund by Blackbird Ventures in 2015.