What does the Australia’s VC landscape look like in 2050

Explore the evolution and future trajectory of Australia’s venture capital scene through the insights of industry leaders, discussing challenges, diversity, globalisation and investment focus areas for 2050.

As the sun sets on the familiar venture capital landscape, industry mavens at the SXSW Sydney panel paint a picture of the dawn that awaits Australia’s VC scene by 2050. With voices from Airtree Ventures, Flying Fox, Co Ventures, Afterwork Ventures and Main Sequence, the discussion, rich in experience and foresight, delves into the transformation from a modest, inward-looking market to a burgeoning global powerhouse, the ongoing quest for diversity, and the investment horizons that beckon.

Craig Blair, Founder at Airtree Ventures, reminisces about the days when the Australian market hardly peeked beyond its shores. “Everything changed with the rise of Atlassian. Now, you can raise on your own terms,” he notes, underlining the shift that has emboldened founders. Yet, he acknowledges the journey is far from over, especially concerning diversity, an area where “we’ve come a long way, but the road ahead is longer.

“How do we back the founders with a face tattoo and those that can’t pitch?”

Craig Blair, Founder at Airtree Ventures

The panel unanimously reflects on the rocky beginnings of the VC environment, with not a single fund from the ‘90s surviving the harsh terrain. “Returns were a measly 1x back then; it just didn’t deliver,” Craig continues, emphasising the maturity that the market enjoys now. “LPs are in it for the long haul now. It’s not a sprint; it’s a marathon.”

Focusing on 2050, the discourse shifts to the anticipation of a richer ecosystem, spearheaded by tech-savvy angels and an explosive growth in tech workers. “Imagine, from 800k to a staggering 4-5 million tech workers,” muses Mike Zimmerman, Founding Partner at Main Sequence. He envisions a future where deep tech and infrastructure finance evolve into a robust asset class, with lessons learned from leaders like Macquarie Bank.

However, the road to 2050 isn’t without its hurdles. Jessy Wu, Investment Principal at Afterwork Ventures, points out the need to move beyond charismatic poster boys and “allow diverse, unconventional founders their shot at the limelight. ”There’s also a clarion call to challenge biases and continually question the status quo”, says Kylie Frazer, Founder at Flying Fox.

Discussing potential investment avenues, the panel lights up. “Spatial computing,” Jessy throws in. “And don’t forget about real problems like waste management. Think maggots,” Kylie quips with a knowing smile. Craig bets on platform shifts and human-brain interfaces, while Mike stands firm on essentials — “Feeding people. Agritech, energy, efficiency and synthetic biology.”

Despite the diverse opinions, one common thread emerges — the future is global, with no room for an ‘Australian VC’ in isolation. “Businesses, ecosystems, they’re all going global. We’re investing offshore, and international VCs are swooping in,” Mike highlights, a sentiment echoed by others.

By 2050, the Australian VC scene won’t just be a player on the global stage — it’ll be running the show. And for those wondering where to place their bets today, the message is clear: look for problems that demand solutions, embrace the unconventional, and remember to be more humble and not too serious.