The rise of private equity and venture capital in Australia is here to stay

You might have heard some buzz about private equity (PE) and venture capital (VC) lately. And for good reason - these investment firms are playing an increasingly important role in the Australian market, and their influence is only set to grow.

So, what's the deal with PE and VC? In a nutshell, these firms invest in private companies, which means they're not focused on companies listed on the stock exchange like the big players on the ASX200. Last June, investment funds had a whopping $66 billion in privately held Australian assets, up 75% from December 2019.

In particular, we're seeing more international interest as offshore PE firms contributed to about 50% of total investments last year, compared to just 35% in 2010. Some big international names like Hillhouse and Advent are even setting up shop locally to get in on the action.

For Ecommerce founders, this surge in PE and VC interest could mean more opportunities to secure funding and support for your business. PE firms are known for working closely with the companies they invest in, providing guidance and resources to help them grow. But more importantly, they also offer founders an avenue to exiting their business.

However, it's worth noting that PE firms have been criticised for relying too heavily on debt to fund their investments, which can be risky. This means that founders need to be strategic about the investors they choose to work with and ensure that they have a solid plan in place for achieving a successful exit.

Overall, the rise of PE and VC in Australia is a trend that Ecommerce founders should be paying close attention to. As these firms continue to pour money into the market, there will likely be more opportunities for growing businesses to secure funding and support founders in achieving first-class exits. So if you’re an Ecommerce founder looking to exit within the next few years, it’s always a good idea to start planning so that you’re on the front-foot.

We’re offering free confidential consultations to help you with just that. Just click here to book in a time.

Back to blog