Australian deep tech venture firm Main Sequence has announced a $250 million fund to increase its focus on solving some of the world’s biggest issues in areas such as climate and food.
Main Sequence aims to turn scientific and research endeavours into successful companies, in turn providing more experts in various fields with further resources to craft tangible technology. When it comes to finding and then funding companies, Main Sequence looks at integration as a key approach, building a startup with science, people, and investment in the fold.
The firm has six ambitious areas of focus: feeding 10 billion people, decarbonising the planet, democratising health access for everyone, supercharging industrial potential, providing society with the tools needed to adapt to the future, and unlocking the benefits of space for humanity.
The sizeable fund comes thanks to support from several major investors, including Horizons Ventures, Hostplus, Lockheed Martin and Temasek, as well as family offices and private investors from Morgan Stanley Wealth Management and Mutual Trust.
This marks the second major fund of this kind from Main Sequence, following its first fund launched in 2017. Backed by Australia’s national science agency, CSIRO, Main Sequence’s initial fund played a key role in the development of 26 deep tech companies, including Myrotia, Kasada (both of which were a part of Australia’s Tech23 Deeptech Festival 2020), Aussie rocket company Gilmour Space Technologies (which broke a hybrid rocket engine record earlier this year), Q-CTRL and Baraja.
Fund I also played a big hand in the launching of Australian plant-based meat startup, v2food, which made its supermarket debut in 2020.
“We had our first fund of $240 million raised in 2017 – and, to be honest, the interest and opportunities have just continued to expand,” Main Sequence Partner Mike Zimmerman tells Dynamic Business.
“This second fund is kind of helping us on the next step to do more of the same with some important changes and expanded focus.”
The Next Horizon
Among the areas of expanded focus with Fund II: decarbonisation. Mr. Zimmerman said there has been an unprecedented amount of interest in new solutions for climate change and carbon foot reduction, further driving Main Sequence’s decision to hold climate impact as a focal point.
“We’ve really seen companies, I think many for the first time, institutional investors, and obviously governments all lined up in seeking commercial solutions to address the carbon challenge. That’s expanded our focus too, and we’ve already made some investments there that we’ll be announcing shortly.”
The spotlight Main Sequence is placing on space is certainly intriguing. Mr. Zimmerman said they are seeing interest growing in the space sector, both from commercial and research standpoints. He also pointed out that Australia, in particular, stands among the territories at the forefront of space tech and research.
“We’re seeing commercial interests line up. There’s just a vast market opportunity in the space sector now, not just for government, but for commercial opportunities and research institutions with really unique assets and capabilities that they can bring to space.
“Australia is, in fact, a world leader when it comes to space capabilities, dating all the way back to the first trips to space, which means there are opportunities across the board. There are probably close to a hundred space startups in Australia right now. Lots and lots of research being done in the sector as well. And those cross all the way from, you know, core launch capabilities, like Gilmour Space Technologies up in Queensland, to applications like Mariota, that’s working on IOT and remote assets across the world.”
While Mr. Zimmerman cannot yet confirm the exact number of companies that will arise from Fund II, he does expect the companies to number “somewhere in that 20 to 25 area”. In two funds, Main Sequence will have launched in the vicinity of 50 companies – all coming from a focus on solving the planetary challenges of today.
CSIRO Chief Executive Dr Larry Marshall congratulated Main Sequence on its sizeable expansion – and what it will mean for various sectors.
“CSIRO collaborates across the entire innovation system, investing significantly in commercialising great science from all Australian universities. We see this commitment continue through Main Sequence’s investments in great companies that have spun out of CSIRO and disrupted markets, including Coviu in telehealth, Emesent in robotics, v2food in alternative protein and RapidAIM in biosecurity,” Dr Marshall said in a statement.
“As Australia looks to science and technology to grow new industries in the wake of COVID-19, Main Sequence is positioned specifically to drive greater commercialisation of all Australian research that will fuel our economic recovery, and make life better by solving national challenges.”
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