Local venture capital firm looks for $50m to ‘chase the S’ in ESG
After earning returns of 121 per cent from its initial seed fund, Brisbane venture capital firm Sprint Ventures is raising $50 million in an expansion capital fund.
Sprint founders Ben Armstrong, Lew Jury and Heath Shonhan
The firm is planning to fund eight to 12 start-up companies with investments from wholesale and sophisticated investors as well as through investment planners and family offices.
Co-founder Lew Jury said the firm was not about just any start up. The company’s focus is the S in ESG – the economic, social and governance standards companies strive for to attract socially conscious investors.
“We invest in the greatest companies that are changing the world. We invest in companies that are building a better future,’’ Jury said.
Among its portfolio is YouPay, a Brisbane start-up kicked off by Matt Holme and Dan Brett that allows people to fund purchases with help from someone else and avoid the debt traps of the traditional buy-now, pay-later cards. Jury is also chair of the company.
“The S part (of ESG) has been neglected. The reason we invested in YouPay is because of what BNPL did and is having to unravel now,’’ he said.
Also in the stable are Hayylo, Radian Energy, Hoops, Leakster and Umps Health. All are in the ESG theme.
“When people talk about ESG and building a better future the two things that spring to mind are greenwashing and forcing funds to do certain things or act in certain ways because of shareholder or member interest,’’ Jury said.
“The political bit is the E. We already have two companies in that space.
“We like to focus on S and I like to focus on the G.
“We think there are massive opportunities and gaps in certain parts of ESG.
“We are getting on and doing, not worrying about the politics behind it.
“We believe the right investors are sharing that as well.’’
The success of the initial seed fund produced two breakouts – YouPay and Hayylo. The latter is a Melbourne company which provides a communication platform for care providers and clients.
“We are looking at some significant investment in the AI space and fintech and payments. Along with energy they are the four thematics of 2022,’’ he said.
Two of the areas Sprint invests in _ aged care and finance _ have just been through royal commissions.
The recommendations that come out of those hearings meant that technology has been developed to solve the issues.
“That’s the sort of companies we invest in,’’ Jury said.
“There has been more of an inflow in venture capital in the past 12 months than in many other sectors. There was a 66 per cent increase in venture deals in 2021 compared to the year before.
“Venture has been growing because it has been getting great wins and returns from those investing back into the funds like the Canvas and Atlassians. This is the next wave: VC 2.0.
“We can put a lot of network capital, providing the introductions and helping them to scale to go overseas.’’
The expanded capital fund was expected to provide between $200,000 to $300,000 to the successful companies.