Australia venture capital to power 100 fintech startups

Venture capitalist brothers Ben and Toby Heap, the founders of H2 Ventures, are planning to raise USD 10 million in order to invest in the startups, smh.com.au reports. The establishment of H2 follows the demise of AWI Ventures, where Toby has been managing director, after its ASX-listed parent Australasian Wealth Investors, where Ben was chief executive, withdrew support for VC.

The change of heart was spurred by a restructure after the company was stung by its investment in financial services business van Eyk, which collapsed amid a governance scandal. Ben Heap, who will be chairman of H2, said he and Toby, who will be managing director, had fielded growing levels of interest from both fintech entrepreneurs and investors in 2014.

H2 plans to fund eight companies every three months; each company will spend six months in its accelerator program to develop business models and pitch to potential investors. Like the AWI Ventures model, H2 will invest USD 100,000 in each startup in return for 10% of the equity, valuing each investment at USD 1 million. AWI Ventures, established in 2014, invested in nine fintech startups. The startups that will complete the final AWI program in June, 2015 are CurrencySpot, Piggy, PayHero, HashChing and Deposits.

The closure of AWI Ventures comes after its parent, AWI, which owned 36% in van Eyk, decided to focus purely on its wholly owned digital wealth businesses, InvestSMART, YourShare and Intelligent Investor. As a consequence, the VC model being employed by AWI Ventures to fund startups was no longer a fit with the new AWI strategy.