About Venture Growth Fund
The Victorian Government is providing $25 million in funding to establish the Venture Growth Fund (VGF). This fund will offer eligible high-growth startups access to venture credit of between $50,000 and $5 million, helping create jobs and driving economic growth. The VGF is part of the Victorian Government 2020-21 State Budget. The objectives of the VGF include: - increasing the level of investment in start-ups. - upskilling the workforce in Victoria. - developing new industries; and - supporting job creation and economic growth. What is venture credit? Venture credit is a relatively new asset class in Australia but has shown great success in some capital markets overseas. In the United States and Europe, venture credit represents about 10 to 15 per cent of total venture funding. Venture credits allow startups to take on debt to fund their company, rather than giving away equity in exchange for capital to extend their cash runway. Unlike conventional debt financing methods, venture credit lenders do not assess the loan based on underlying assets but instead take a holistic assessment of the company and its future potential.