Fund your potential.

We invest in early-stage companies, typically Pre-Seed and Seed rounds. We are primarily looking for Australian companies. However, due to our fund structure, we can make up to 20% of our investments outside of Australia, in line with our fund structure’s parameters.

Our Scale Venture Fund 1 is sector-agnostic but has special focus areas, including Care, Climate Tech and Consumer Tech. We also have a strong interest in AI-driven startups where AI is the core engine of innovation.

In addition, a key difference in our strategy is that we are very intentionally seeking to leverage the "lived experience" advantage and unique insights of women as innovators—innovation by women, for women, for the benefit of everyone.

For a very long time, our world has been designed by a narrow, homogenous group. Women were excluded from clinical medical trials until the 1990s, and female conditions outside of oncology make up less than 2% of the current healthcare pipeline. This has created a vast, underserved 'female economy,' an opportunity bigger than China and India combined. Women founders, by virtue of their lived experience, are uniquely positioned to solve these neglected problems and design innovative solutions that resonate with the needs of over half the global population. 

When we talk about “lived experience”, we are referring to the unique experiences of women and the perspectives that they can bring to innovation, on account of these experiences.  Think technology relating to peri-menopause, post-natal prolapse, sexual wellness, pregnancy testing, pelvic pain and women’s banking - but also, less obvious things, like speech development technology for children informed through the maternal experience, and NDIS care management tech developed by carers, who are, on the data, largely women.

We accordingly welcome founders and specifically seek innovation that is informed by women’s unique insights, in particular where solving for historically underserved female markets.

While we are sector-agnostic at the top line, we have a strategic focus on high-growth sectors where women founders have a distinct advantage.  Specifically, these are Care, Climate and Consumer Tech.

We define “Care Tech” broadly to include med and health tech, as well as disability, aged-care and child and family tech.  It pertains more broadly to human well-being, and therefore might also include things like femtech, sex tech and death tech.

When it comes to Climate Tech, we define this broadly as well, to encompass any scalable innovation that supports the health of the planet. It includes solutions that address the drivers and impacts of greenhouse gas (GHG) emissions. Our approach is to focus on less capital-intensive models such as software, biomaterials, circular economy, ag-tech, food tech, and certain sustainable products.

“Consumer Tech” is not more stuff! We’re interested in tech that adopts a D2C business model while leveraging the advantage of women’s lived experience.  

We base this on three core rationales:

1. women control or influence 85% of global consumer spending power.  By 2028, they're projected to hold a staggering 75% of discretionary spending, making them the most influential consumer demographic.  Research by Boston Consulting Group further highlights their control over $20 trillion in global consumer spending.

2. Women-led startups are uniquely positioned to cater to this massive consumer segment. Their firsthand understanding of female consumer behavior and pain points fuels the development of innovative and successful consumer products. This focus on female-centric needs aligns perfectly with research showing women increasingly "engage with brands and experiences that align with their needs and tune out the rest".

3. Women have significant representation within design and marketing fields crucial to consumer product development. This translates to a built-in advantage for women-led businesses, allowing them to leverage female expertise throughout the product development process.

Beyond our core gender mandate, we assess companies on several key factors, including:

• Founding Team: We look for experienced and capable teams with a track record of building and scaling businesses. We have a strong bias toward teams with lived experience related to the problem they are solving.

• Problem & Solution: We look for a clear, pressing problem and a disruptive, user-centric solution. We have a bias towards solutions aimed at female markets.

• Scalable Product/Technology: We look for technology that can support future growth and expansion without a proportional increase in overheads.

• Market Opportunity: We look for a huge addressable market with a validated market need, and we have a bias towards female markets.

• Competitive Advantage: We look for a clear competitive advantage, proprietary technology, and defensible intellectual property.

• Business Model: We look for sustainable revenue streams, an efficient cost structure, and a compelling go-to-market strategy.

• Traction & Financials: We want to see early traction metrics, like customer growth and sales figures, as well as sound financial projections.

• Exit Potential: We look for a potential for a 10x or more return and a clear alignment with our fund's investment goals.

• Deal Terms: We intend to set aligned deal terms regarding valuation, liquidation preferences, and other legal matters.

We're a 'for-purpose' organisation with a mission to generate both strong financial returns and positive social impact by investing in high-growth, early-stage, women-led companies. We are a venture capital firm, not a social enterprise fund, and - as such - we have a primary objective to provide investors with a minimum return of 25% IRR. 

While we actively seek impact innovation and work ardently to support ventures that integrate social and environmental considerations into their business models, every investment we make is primarily assessed on its potential for financial success. Our approach is to demonstrate that it is possible to achieve both strong financial returns and positive social impacts. 

The Scale Investors team is deeply impact driven and we have deliberately considered impact through-out our mandate, thesis, pitch submission and due diligence process, as well as our portfolio company monitoring and reporting. 

Some of the key ways we seek to achieve impact are as follows:

Gender metrics tracking, including with respect to intersectional identity: We track these metrics from pitch submission stage through to company scale up. At pitch submission stage, we are concerned with these metrics across the founders; at portfolio company level, it extends to the metrics within the portfolio company boards and executive teams.  We also track these metrics at our fund manager level.

Gender equity impact measurement: beyond gender identity data, we use a series of international and proprietary tools and frameworks that track and encourage gender equity within our portfolio companies and at fund level. These tools and frameworks extend across a wide range of matters, ranging from the adoption of parental leave and flexible work policies to modern slavery best practice and reporting, etc.

Responsible Investment: We are committed to responsible investment and in addition to the typical “negative screens” that we adopt to ensure that we do not invest in companies that engage in harmful or unethical practices, we are particularly concerned with responsible AI development.  We have in use a Responsible AI development framework and due diligence questionnaire, developed in consultation with experts as well as responsible AI development reporting requirements.  We similarly use a platform to track and report on modern slavery.

ESG Performance: We use the ESG_VC Framework, an industry-adapted assessment methodology, to track gender metrics and broader environmental, social, and governance (ESG) performance at the portfolio company level.

A venture-backable business is a company with a business model and technology that has the potential to generate significantly outsized returns (often aiming for a billion-dollar-plus valuation). For a VC, most startups in a portfolio will fail, so the few that succeed must have the potential to return the entire fund and then some. It's important to understand that a great, profitable business isn't necessarily a venture-backable one; the key is rapid, scalable growth that can lead to a huge exit.

Defining a Venture-Backable Business

• Outsized Returns: VCs need to see the potential for a large exit (acquisition or IPO) that can return 10x or more of the investment. For an early-stage fund, this can mean a company eventually reaches a valuation of over $1 billion or the multiple hundreds of millions. 

• Massive Market: The company must be targeting a market with a Total Addressable Market (TAM) in the billions of dollars. The market should be large enough to sustain explosive exponential growth and achieve significant market share.

• Exponential Growth: VCs look for startups that can grow at a high velocity, often with a clear path to generating $100 million or more in annual revenue. This growth should be scalable and repeatable, meaning the business can significantly increase revenue without a proportional rise in costs. This is why models like Software-as-a-Service (SaaS) have been such a successful fit for venture funding.

• Strong, Experienced Team: A great team is considered crucial for success, as it can adapt and drive the company forward even if the initial product pivots. VCs look for founders with deep industry knowledge, a clear product and go to market roadmap, and the ability to attract top talent.

• Core Tech: The core technology is the engine of the business, rather than the business simply being tech enabled.

As with most funds, our goal is to help you achieve a successful exit within the fund’s operational period. Our fund operates with a ten year term, commencing in late 2025.  This timeframe guides our investment strategy and our support for portfolio companies. We appreciate that early stage founders may still be developing their Go To Market or demonstrating product/market fit, however to be investible, we require that founders should be able to demonstrate a pathway to exit during the term of the fund.  This includes, for example:

• Market Share and Revenue Projections: Clearly articulating a bottom up go-to-market capturing 1%, 5%, and 10% of your target market would translate to in terms of revenue. This demonstrates a realistic thorough understanding of your market potential and how it can contribute to a significant exit.

• Comparable Exits: Providing comparisons for similar or adjacent business exits. This helps us understand the potential valuation multiples and the types of companies that have successfully exited in your space.

• Potential Target Acquirers: Identify potential strategic or financial acquirers for your business. This shows you have considered the landscape of potential buyers and how your company fits into their growth strategies.

A tech product's role is a key factor in determining if a business is venture-backable. While many (all?) businesses today use technology in some way, for a startup to be considered venture-backable, the technology must be foundational to the product itself—not simply the systems that support the business.

We're looking for businesses where technology is the engine, not just a tool to improve operations. Foundational technology is the core of your product; it's what creates the value and is often difficult for competitors to replicate. It is the unique code, algorithm, data and/or intellectual property that gives you a defensible market position, or a "moat." For example, a company like Stripe is venture-backable because its proprietary code that processes payments is foundational to the entire digital economy, not just because it has a website. In contrast, a supportive technology is used to make a business more efficient, but it isn't the primary source of value. When it comes to a consulting firm that, for example, uses a custom client management portal, the core value is the expertise and advice, not the portal's technology. That's a great use of tech, but it isn't foundational.

We are focused on venture-backable businesses with the potential for exits in the multiple hundreds of millions and above, ideally "unicorn" or billion-dollar valuation businesses.  If you’re not sure if you’re sitting on a unicorn business opportunity, we encourage you to still submit a pitch submission to us HERE or to join us at one of our virtual monthly office hours HERE.

We wish we could invest in every deserving woman-led startup! However, like any venture fund, we have a rigorous selection process and must also consider our broader portfolio construction. This means that sadly, we must decline investment more than we would like and more often than not. We are however committed to increasing capital flows to women founders, and even if we can't invest, we aim to provide valuable feedback and connections wherever possible.

Over time, we hope to raise more gender lens funds, so we can support even more women-led startups in Australia and beyond.