- BRW Lists
Published 28 February 2014 12:12, Updated 02 March 2014 17:16
Jason Yetton, Westpac’s head of retail and business banking, says there will be a strict “arm’s length” relationship between the bank and the venture capital manager, called Reinventure Group.
Australia’s venture capital market is gaining a powerful new player with Westpac Banking Corp’s decision to invest up to $50 million in early stage funding of technology start-ups.
The bank has decided to establish its own limited partnership fund similar to those used in Silicon Valley.
It hopes to fund about a dozen companies run by proven entrepreneurs with proven business models.
One area of focus will be companies that offer disruptive technologies that might have an impact on the traditional banking customer experience.
Other areas of interest will be data aggregation and payment systems.
It is possible the companies that win the backing of Westpac’s venture capital arm will be given access to the bank’s business units, intellectual property and distribution network.
Jason Yetton, Westpac’s head of retail and business banking, told The Australian Financial Review there would be a strict “arm’s length” relationship between the bank and the venture capital manager called Reinventure Group.
The company was founded by Danny Gilligan and Simon Cant.
“We want to encourage an autonomous approach,” he said.
“Venture capital has a very different culture to a bank and we don’t want to stand in the way of them doing their jobs.”
However, the investment committee will include senior Westpac executives, including Mr Yetton and the chief executive of the bank’s Australian financial services division, Brian Hartzer.
Mr Hartzer was a driving force behind the creation of a separate venture capital arm providing early stage funding.
The two founders of Reinventure have experience working with digital investments.
Mr Gilligan was until recently director of digital ventures at APN News & Media. He was responsible for mergers and acquisitions, strategic partnerships and early stage digital ventures.
Mr Gilligan previously co-founded Gizmo Corporation, a provider of technology services to small and medium-sized business.
The co-founder of Reinventure, Mr Cant, was the principal of Cant Associates, which advised companies such as UBS, Suncorp, AMP, Fairfax, News Ltd and APN News & Media on innovation.
He previously worked for ninemsn and angel investment group Tinshed. Also he worked as a consultant with the global innovation consulting firm, WhatIF! Innovation.
Mr Yetton said Westpac was making a long-term commitment to venture capital investment.
He said the bank would invest up to $50 million over time.
Westpac’s move into venture capital follows similar moves by Telstra and Optus.
Banks overseas have launched venture capital arms, including Barclays in the United Kingdom and Citi in the United States.