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Australia’s venture capital heavyweights—Airtree, Square Peg and Blackbird—are standing by a flexible approach to startup board representation as scrutiny mounts over Dovetail’s governance.

Dovetail is under scrutiny after its chief legal counsel, Bethany Lo Russo, accused CEO Benjamin Humphrey of "a pernicious and relentless pursuit," alleging he used his position to pressure her into more than just awkward encounters.

Humphrey denies the claims and is pursuing defamation proceedings, but the case has raised broader concerns about governance – or lack thereof – at the $960 million startup, which is overseen by just two directors—Humphrey and co-founder Bradley Ayers, who no longer works at the company.

As Capital Brief’s Bronwen Clune reports, Blackbird, an investor in Dovetail, had only an observer role on the board—a setup governance experts criticise as toothless. Blackbird’s own blog advocates for robust board structures, yet its involvement with Dovetail suggests a more hands-off reality.

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Market movers

Nine Entertainment shares soared on Tuesday, after rival Seven West Media unexpectedly forecast TV ad growth, lifting sentiment across the sector.

The quick sync

• Betting on crypto as an election winner, Peter Dutton channels Donald Trump vowing to revive stalled efforts to establish crypto laws. (Capital Brief)

• Big banks are copping a 30% cost hike to keep regional banking afloat via Australia Post, dodging a government levy in a behind-closed-doors deal. (Capital Brief)

• The Greens’ 10% billionaire wealth tax is unlikely to pass, but as Labor eyes a hung parliament, its real power lies in political leverage, not policy. (Capital Brief)

• Sam Altman torches Elon Musk’s US$97.4b OpenAI bid, calling it "ridiculous" and taking a brutal swipe at Musk’s happiness. (Capital Brief)(WSJ)(Bloomberg)(Quartz)

• Deloitte US ditches diversity targets and bans gender pronouns in emails for government work, but its UK branch refuses to follow suit, reaffirming its commitment to inclusion. (FT)

Trading floor

M&A

• Fortescue finalizes Red Hawk takeover, gaining control of the Blacksmith project. (Capital Brief)

• Australia’s aircraft deals with US firms could secure exemption from Trump’s steel tariffs. (The Australian)

• Disney+ to add ESPN hub in Australia, challenging Foxtel. (Capital Brief)

• KKR is set to revise its $2.2b bid for Perpetual after the deal was hindered by a significant tax bill, prompting the board to convene a meeting. (AFR)

• APRA accepts Cbus’ risk reform plan, investigates spending. (Capital Brief)

• Sportitude merges with RunDNA, ending 15 years as an independent brand. (SmartCompany)

• Retail Food Group is shutting down Michel’s Patisserie, converting stores to other brands like Gloria Jean’s and Donut King. (The Australian)

• Morgan Stanley sells $3b X Corp. debt amid Musk-driven investor interest. (Bloomberg)

• PEP secures $800m debt for $1.4b SG Fleet bid. (AFR)

• PEP in talks to buy Imaging Associates from Advent Partners. (AFR)

• Vulcan Steel eyes expansion, with InfraBuild’s steel business as a key target. (The Australian)

• Macquarie exits Net-Zero Banking Alliance as Trump pulls back climate commitments. (Reuters)

• Liontown led a lithium selloff as China’s CATL and Jiangsu Lopal Tech restarted a refinery, worsening oversupply concerns. (Capital Brief)

• Campus Living’s $2b sale is on hold, with owners considering partial divestments. (The Australian)

• Government may acquire Rex if sale fails, offers financial aid. (Capital Brief)

• Origin Energy is poised to gain key NSW transmission access in the South West REZ. (The Australian)

• Glow Capital backs Foil Drive, its second deal after Delta Labs. (AFR)

Capital Markets

• EU threatens countermeasures over US tariffs; Australia fights for exemption. (Capital Brief)

• Vulcan Steel warns of economic challenges, citing Trump’s tariff threats and Sanjeev Gupta’s struggling Whyalla steelworks, which is pressuring industry margins. (The Australian)

• Major banks will halt regional closures until 2027 under government pressure. (Capital Brief)

• Superhero raises $3m to launch super admin business. (AFR)

• VGI Partners Global posts $62m loss amid ongoing struggles. (Capital Brief)

• Hysata and ACWA Power partner to showcase high-efficiency electrolysis for Saudi green hydrogen projects. (Hysata)

• Gold prices rise on US tariffs, lifting Evolution and De Grey. (Capital Brief)

• Tesla chair Robyn Denholm urges a $25.4b R&D boost, calling Australia’s innovation decline a “national emergency.” (AFR)

• Star Entertainment faces equity-raising challenges, needing lender support and a profit strategy, while private equity may intervene. (The Australian)

• Banks agreed to higher costs for Australia Post banking services to avoid a government-imposed regional levy. (Capital Brief)

• The government and APRA will allow banks to exclude HELP student debt from mortgage assessments to improve home loan accessibility. (Capital Brief)

• Westside Energy seeks $300m for its Meridian Gas Plant stake, with Beach Energy and GLNG interested. (The Australian)

• Ashtead Group plans US listing shift, with shareholder vote in June. (Capital Brief)

• Breville is shifting production from China to Mexico and Southeast Asia to reduce exposure to US-China trade tensions, anticipating potential Trump tariffs. (The Australian)

• The U.S., UK, and Australia sanctioned Russia-based Zservers and two Russian nationals for supporting Lockbit ransomware attacks, citing national security concerns. (Reuters)

• Stripe eyes US$85b valuation in new share sale, nearing 2021 peak. (Capital Brief)

• Federal Reserve Chair Jerome Powell told the US Senate that the Fed won’t rush rate cuts, emphasizing that inflation remains above target. (Capital Brief)

• CSL’s solid results weren’t enough to stop a $5b wipeout, as falling US vaccine uptake and RFK Jr’s looming health policy shake-up rattled investors. (Capital Brief)

• Goldman Sachs scraps its IPO diversity mandate, bowing to legal pressure and the rising Trump-era pushback against DEI. (FT)

• Beulah’s $2.7b Sth Bank skyscraper project has hit a financial wall, with its project manager collapsing under cost blowouts and market pressures. (AFR)

VC

• Daniel Besen invests in Sydney’s Climate Tech VC firm. (AFR)

• Airtree, Square Peg, and Blackbird defend their flexible board strategies as scrutiny over Dovetail’s governance grows amid harassment allegations against CEO Benjamin Humphrey. (Capital Brief)

• Shopfront raised $800k to expand its multi-marketplace listing platform. (Startup Daily)

• AI healthcare startup Harrison.ai raised $179m to expand its Nvidia-powered medical diagnostics technology into Europe and the Middle East. (The Australian)

• Realbase founders Frank and Jacques Greeff have made their first investment as angel investors, acquiring a stake in Sydney AI website startup Relume and joining its board. (AFR)

People moves

• Workers at the Tomago aluminium smelter are launching industrial action over a pay dispute as the Albanese government urges the US to exempt Australian aluminium from tariffs. (The Australian)

• TenCap’s Jun Bei Liu hits back at scrutiny over her relationship with TenCap co-founder Jason Todd, saying investors back her for results, not romance. (InvestorStrategy)(AFR)

• JPMorgan farewells investment banking veteran Jennifer Nason with a star-studded New York send-off after 39 years at the firm. (AFR)

• ASIC’s Joe Longo warns scandal-hit CEOs their misconduct signals deeper governance failures, vowing tougher scrutiny on corporate culture and accountability. (AFR)

• James Packer is making himself at home in Trumpworld, securing a Mar-a-Lago lease after bankrolling a Melania Trump documentary alongside Hollywood exile Brett Ratner. (AFR)

The watercooler