Despite weaker equity markets in recent months, global investor Square Peg has ploughed ahead to raise USD$550 million ($859 million) for investment in both early and late-stage tech companies in Southeast Asia, Australia and Israel.
The VC firm – which has backed the likes of Canva, Airwallex, Amber and Blinq – will deploy the capital in two ways – firstly, for a core venture fund that invests in seed to Series B startups, and secondly, in the later stages of strong-performing companies that have previously secured capital via its Opportunities Fund.
In a LinkedIn post, Square Peg co-founder Paul Bassat said there was no more exciting time for the startup ecosystem than now.
“Markets have got a bit tougher for both startups and VCs this year and we are super grateful to have the continued support of our investors,” Bassat said in the post.
“Hostplus and AustralianSuper are once again our biggest backers and we are incredibly grateful for their support alongside a range of other institutions, endowments, founders and family offices.”
It marks the fourth time superannuation fund Hostplus has backed a Square Peg raise, which Roc Partners also joined alongside a number of new institutional investors.
Founded in 2012 by Paul Bassat, Barry Brott, Tony Holt and Justin Liberman, Square Peg has invested in 60-plus companies, delivering more than $905 million (USD$580 million) to investors across 11 exits with an internal return rate (IRR) of 42 per cent.
To date, the VC – which has offices in Sydney, Melbourne, Tel Aviv, and Singapore – has raised more than USD$1.6 billion ($2.5 billion) from a combination of new and returning investors.
The firm’s investments include financial service Athena Home Loans, hiring platform Earlywork, fintech Prospa, marketing tech powerhouse Rokt, meat company Vow and sustainable home-cleaning brand Zero Co.
Looking abroad, Square Peg’s portfolio includes digital lending unicorn FinAccel, digital payment platform Stripe, real estate marketplace PropertyGuru, and LottieFiles – a San Francisco-based motion graphics service that works with companies like Google, Airbnb, and Netflix. To date, the company serves more than 135,000 businesses.
“Over the past decade, we have demonstrated that there are significant benefits to investing across multiple regions, which allows us to empower exceptional tech founders from a broader set of opportunities,” Square Peg said in a statement today.
“The larger opportunity set also allows us to be highly thematic in our approach and obtain compounding benefits from our domain expertise.
“Our fifth generation of funds has been raised in a period of significant global economic uncertainty, however we are as excited as we have ever been about our opportunity set and believe the coming years will be an incredibly attractive time to be deploying in private tech markets.”