The Future of Australian Venture Capital
Chatting to Elicia McDonald, Partner at Airtree
This interview is a part of The Rising Tide- Your Guide to Startups and VC in Australia. It was written by Sachin Shah, Adam Miller and Saurav Risbud to demystify the startup world and give you the tools you need to make your mark.
What does the future of venture capital investors look like in Australia?
Two key trends are shaping the next generation of venture capital investors in Australia.
The first is the emergence of homegrown venture talent. As the local ecosystem has matured, multi-generational funds have started to materialise. This has created opportunities for investors to progress through the ranks to the partnership level of their firms.
Multi-generational change is notoriously difficult to navigate, but any enduring fund will eventually need to face it. It involves deliberate succession planning to attract and develop investment professionals who can grow within the fund.
At AirTree, Jackie Vullinghs and I represent the first generation of partners trained in venture in Australia and promoted through the ranks to the partnership level.
The second trend is the increased awareness that diversity of perspectives across venture capital investors leads to better outcomes for the fund and the broader ecosystem. Diverse vantage points help funds make the best possible decisions.
Good ideas can come from anywhere, and it’s important that, as decision-makers, venture capital investors represent the societies they move within so they can best identify the potential of those ideas.
What are your practical tips for landing a VC role?
Start doing the job before you get the job!
Build your network by talking to startup founders and operators. Investigate a trend you’re interested in and write up an investment thesis on it. Build a fantasy portfolio of companies you’d love to invest in. These are ways you can demonstrate the key qualities that will help you land a VC role: a genuine passion for technology and an interest in products and people.
All of these activities would set you up well for the first step in AirTree’s hiring process: answering questions about what startups you’re interested in and the type of investments you would make.
What other functions are there in a venture capital firm besides the investment team?
There’s a lot that happens behind the scenes at a venture capital firm to keep the wheels turning. Running a multi-million dollar fund involves significant operational complexities managed by finance, accounting, legal, investor relations, and operations professionals.
As the venture capital ecosystem has matured, firms have broadened their support for founders beyond just capital. The “platform” function has emerged, encompassing roles from marketing and community to portfolio support and talent.
From a VC POV, what’s your advice to aspiring Aussie founders?
Be unrelenting in your ambition. There has never been a better time to build a global category-leading technology business from Australia.