☕️ Funding crunch

Startup funding is down, but still at historically high levels

August 25, 2023

Good morning.

It may feel like there’s less money out there for Aussie startups.

But while funding has undeniably declined it remains at historically high levels. According to at least one data source, ~$5 billion was invested into Australian startups last financial year. That is a sharp decline from the record $9.89 billion a year earlier. But also the second highest figure on record.

And for the first time, climate tech startups attracted more funding than their fintech counterparts.

LOI Subscriber #TBD

MARKET MOVERS

*Stock data as of the market close. Commodities and crypto data in USD.

Market News: Qantas reported a record profit ($2.5 billion on an underlying basis) in the final result of the Alan Joyce era. The company also announced a $500 million share buyback program and a massive new fleet order as it shifts its focus to ultra-long haul flights that are underpinning strength in its international business. Despite the record profits and record high ticket prices, Joyce said any moves to grant Qatar Airways more flights into Australia would “distort the market” 🤔. Joyce will now fly off into the sunset and formally hand the keys to his successor, CFO Vanessa Hudson, in November.

THE QUICK SYNC

  • Turkey raised interest rates by 7.5 percentage points to 25%. (CNBC)

  • The average 30 year mortgage rate in the US rose to 7.23% - a 22-year high. (CNN)

  • Sandwich chain Subway will be sold to private equity firm Roark Capital for US$9.5 billion (Reuters)

  • The death of Yevgeny Prigozhin was likely an assassination approved by Russian President Putin, according to US and UK officials. (Bloomberg)

  • CBA’s $10 million man and the problem with soaring executive pay (Capital Brief)

TOGETHER WITH SWYSH

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To make selection easy for you, we've picked out a few top stars for Father's Day:

TRADING FLOOR

M&A:

  • Woodside Energy has hired Morgan Stanley to run the sale of its Macedon and Pyrenees interests in Western Australia. (AFR | The Australian)

  • Whitehaven Coal could emerge as the buyer of both BHP/Mitsubishi coal mines, as contest favourite Yancoal drops out. (The Australian)

  • JR Richards & Sons seeks a new owner to succeed its founding family. (AFR)

  • MSIP confirmed its withdrawal from the Alinta Pilbara auction despite being shortlisted. (AFR)

  • Alinta Energy is considering bidding for Origin Energy's Eraring coal power generator. (AFR)

  • PAG Asia Capital is set to acquire Australian Venue Co for approximately $1.4bn. (AFR)

  • Journey Beyond is up for auction again, just under two years since its last change of ownership. (AFR)

  • Morrow Sodali is considering partnering with Alliance Advisors to strengthen its operations for a potential Wall Street IPO. (AFR)

  • Costa Group’s profit warning raises doubts about the $3.50 per share takeover offer from a New York private equity firm. (AFR)

  • Non-alcoholic drinks store Sans Drinks saved as administrators sell to online wine retailer Just Wines. (BNA)

  • Speculation is mounting that Brookfield is interested in a play for The Star (The Australian)

Capital Markets:

  • Ord Minnett invited top fund managers to explore upcoming IPO prospects for next year. (AFR)

  • Regal Funds purchased Chris Mackay's 6.6% stake in Magellan Financial. (AFR)

  • Acusensus surpasses IPO forecast with influx of mobile phone detection contracts. (BNA)

  • Opthea starts a $80M capital raise for drug candidates targeting wet AMD. (BNA)

VC:

  • Blackbird Ventures invested $7m in Kiki's seed round through its 2022 funds in New Zealand and Australia. (AFR)

Others:

  • Alfasi Property kicked off a $100M Melbourne office project, showing confidence in demand for family-run office space in the city fringe market. (BNA)

  • Tabcorp reports a $66m full-year net profit, exceeding market expectations after the demerger with its lucrative lottery business. (SMH)

  • MA Financial's asset management saw record $1.26 billion inflows in H1, but firm-wide revenue fell 12% due to limited deal-making affecting investment banking. (AFR)

  • Megaport's chairman has greenlit the Sydney-to-Perth undersea cable construction in collaboration with Alcatel Submarine Networks. (AFR)

  • Whitehaven Coal is facing pressure to return funds to shareholders while it weighs a tilt at BHP’s coal assets. (SMH)

THE WATERCOOLER