Funding for startups that need to raise over $1 million is “pretty woeful” in Australia, according to Freelancer.com CEO Matt Barrie.
Speaking at an Amazon Web Services event in Sydney today, Barrie told media that while there are a number of incubators such as Startmate for early stage startups, there is not much funding available for startups who need to raise $1 million to $5 million.
He said that only two local venture capital funds, Square Peg Capital and Blackbird Capital, exist for startups that require this amount of money.
However, Australian startups may soon have more venture capital funds to draw on with reports that PayPal co-founder Peter Thiel is looking to establish a $150 million fund.
“He will get a lot of deal flow because he’s aiming for the $1 million to $5 million revenue range,” Barrie said.
In July 2012, Thiel invested $1.2 million in Australian start-up ScriptRock.
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Barrie added that Australia needs to start producing more strong technology companies rather than relying on mining and resources for revenue.
“The great thing about the Australian startup scene is that despite the problems with the financing environment, a lot of companies are working away behind the scenes and coming up with the dogma of raising funds from their customers.”
For example, he said companies such as Atlassian Software Systems and online retailer Kogan didn’t raise venture capital for a long period of time but came up with good products to sell to customers.
Follow Hamish Barwick on Twitter: @HamishBarwick
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