Superannuation fund Westscheme has become one of Australia’s biggest providers of venture capital and is looking to expand its activities in the sector by negotiating new funding deals with universities and research institutions.
Perth-based Westscheme has three funding programs in place to help Australian universities commercialise their research and is seeking to finalise two new funding programs.
Chief executive Howard Rosario said the increased commitment to venture capital was driven fundamentally by Westscheme’s investment strategy, but it also meant the fund was able to support a lot of useful research.
“Westscheme members as a group are probably the largest private sector supporters of early stage research and venture capital in Australia,” Mr Rosario said.
The fund’s first big investment in venture capital was through the Murdoch Westscheme Enterprise Partnership, launched in 2004.
Westscheme has committed to provide Murdoch University researchers with up to $10 million to help commercialise their intellectual property. It has committed to provide a further $10 million to the Stone Ridge Ventures Technology Fund, which will support researchers at places other than Murdoch.
Westscheme has also appointed Stone Ridge Ventures – set up by Perth investors Rob Newman and Matt Callaghan – as the funding manager for the Murdoch scheme.
Mr Rosario said some of Australia’s major universities had been attracted by the model that Westscheme pioneered at Murdoch. That has resulted in Westscheme agreeing to provide $15.5 million to the Uniseed fund, which supports the commercialisation of research at the universities of Melbourne, NSW and Queensland.
“Having done MWEP, we had some credibility and were invited to talk to them,” Mr Rosario told WA Business News.
Westscheme is currently negotiating a new funding agreement with several medical research institutes in Australia, though not in Western Australia.
It is also negotiating a new funding program with up to six new universities.
“That will allow Westscheme members to support university research at five out of the top 50 research universities in the world.”
Mr Rosario said Westscheme’s investment in venture capital was already starting to pay off.
“We are currently earning a positive return because some things are already firing for us,” he said.
Westscheme’s backing of venture capital reflects the group’s overall investment strategy, which has a bias away from mainstream assets like shares and government bonds toward alternative asset classes like private equity and infrastructure.
