Australia and New Zealand are a far cry from Silicon Valley, yet the problems and circumstances of their venture environments tend to be similar in nature.
Megadeals are rarer today, early-stage funding is up, valuations have come back to earth, and investors are encouraging their portfolio companies to demonstrate a sustainable business with a clear path to revenue. The difference is that the geographic isolation of Australia and New Zealand creates a sense of hustle, if not urgency, around raising funds and building a global product.
The Aussie and Kiwi startup ecosystems are newer and less robust, and their markets are generally smaller than their U.S., Asian and European counterparts. As such, startups here have a greater need to access not only international markets, but also foreign funds, particularly if they’re operating in capital-intensive industries like deep tech, and for later-stage rounds.
“For the large majority of Aussie and Kiwi businesses, their main markets are typically offshore,” Dan Krasnostein, partner at Square Peg Capital, told TechCrunch+. “Having investors on the cap table from these markets can be helpful for growing and building local teams in those markets, or for finding customers.”
Rather than a weakness, startups from these countries have turned this set of circumstances into a strength. They know how to punch above their weight, and they know that they have to build a global product from Day 1.