Program Objectives
The objectives of the Innovation Investment Fund (IIF) are:
- to develop fund managers with experience in the early stage venture capital industry;
- by addressing capital and management constraints, encourage the development of new companies which are commercialising research and development (R&D);
- to establish in the medium term a "revolving" or self funding scheme; and
- to develop a self-sustaining Australian early stage, venture capital industry.
Program history
The IIF program was announced in 1997 and is currently in its third round of investment. Round one commenced in 1998 and supports five licensed fund managers. A second round was announced in 2000 with four licensed fund managers commencing operations in 2001. The third round of investment was announced in 2006 with funding commencing in 2007. Two fund managers have been licensed under the third round and it is anticipated that up to eight additional fund managers will receive licences.
The IIF venture capital funds invest in early stage companies commercialising Australian R&D. The IIF enables private sector investors to leverage off public equity capital. By demonstrating the returns achievable from investing in such companies, IIF aims to encourage additional private sector investment.
IIF licensed fund managers
Fund managers have ten-year licences and are selected against merit criteria including their experience in early stage equity investing and raising private capital. They are responsible for all investment decisions, which are made on a commercial basis in accordance with their own investment practices, subject to the IIF program guidelines.
|
Fund Manager |
Capital Commitment ($m) |
|
Round 1, 1998 |
|
Allen & Buckeridge |
41.25 |
|
AMWIN |
41.25 |
|
Coates Myer |
41.25 |
|
Momentum |
31.00 |
|
GBS Venture Partners |
42.50 |
|
Round 2, 2001 |
|
Start-Up Australia |
39.21 |
|
Kestrel Capital |
50.00 |
|
Neo Technology Ventures (formerly Newport) |
31.70 |
|
Stone Ridge Ventures |
35.69 |
|
Round 3, 2007 |
|
|
Cleantech |
50.00 |
|
Brandon Biosciences |
40.00 |
|
Total |
443.85 |
round 3
Following the success of rounds one and two, a third round of the IIF program was announced in the 2006 Budget, with $200 million made available to create ten new funds of up to $20 million each over a five year period. The Government investment is to be matched by investment from the private sector on a minimum one to one basis.
Four fund managers were selected in the first round of IIF3 in June 2007:
In October 2007, the $50 million Cleantech Australia Fund became the first Round 3 Fund to be licensed and in January 2008 the $40 million Brandon Biosciences Fund No. 1 was licensed. Negotiations continue with the remaining two fund managers. Licence applications for 2008 have closed and a shortlist of applicants has been drawn up. The shortlisted applicants are now undergoing further assessment.
Current program operational details
Current results and details on both the IIF program and licensed managers can be found on the AusIndustry site.
For details on other government venture capital support programs please see the Venture Capital and Commercialisation fact sheet.
Further information
Policy Issues
Tricia Berman
Innovation Policy Branch
Phone: +61 2 6213 7444
email
Web: www.innovation.gov.au
Operational Issues
Phone: AusIndustry hotline, 13 28 46
email
Web: www.innovation.gov.au/Section/innovation
Web: www.ausindustry.gov.au