OneVentures takes VC industry lead on ESG investment and oversight
31 August 2021
Australian venture capital (VC) firm OneVentures today announced it will apply a new responsible investment filter to all future portfolio investments, making it one of the first VC firms in Australia to formally commit to only investing in companies that demonstrate ESG principles.
Under the new OneVentures policy, the firm will apply both positive and negative investment screening, reviewing companies’ performance metrics related to ESG outcomes in addition to standard financial metrics. It will actively select healthcare and technology companies considered to have a positive social and economic impact.
The technology and healthcare specialist VC firm will also bring a sharper focus on helping portfolio companies meet the highest possible ESG standards as part of its operational engagement, including embedding key ESG requirements into term sheets and investment documentation, building reporting frameworks for companies to adhere to, and requiring oversight within company boards.
OneVentures’ Managing Director, Dr Michelle Deaker, said the time had come for Australian VC firms to align their investment strategies to responsible investment practices having regard to the societal greater good, recognising the contribution these investment decisions make but also the business opportunities they present.
“OneVentures has always had strong sense of purpose around societal benefit through our investments. We not only want to be investing in companies that solve large unmet market needs with potential for significant upside, but for that principle of responsible investment to be formally embedded into our screening and decision-making processes,” Dr Deaker said.
“ESG considerations will soon be a given for the venture capital sector in Australia, with acceleration underway in many markets internationally. That is why at OneVentures we’ve gone beyond ESG to the next step of alignment to UN Sustainable Development Goals, a measure which we apply to our portfolios. The public already expects it, institutional investors will demand it, and start-ups will look for it in their VC partners,” she said.
“We know too that responsible investing is smart investing. Based on our experience, new ventures that are focused on a clear purpose, have strong governance, diversity principles and that are able to demonstrate a positive impact through their activity typically perform better financially.
“One of our best performing companies will replace needles and syringes for vaccinations, an 18th century technology, with a micro-array patch. The patch is simple to apply (providing for self-administration in a pandemic), removes cold storage requirements (critical for the third world but a major cost in supply chains) and offers dose sparing (more vaccinations for the same quantity of vaccine). Vaxxas is one of many game-changing technology companies in our portfolios that improve patient outcomes and clinical care, and otherwise enhance the quality of people’s lives,” Dr Deaker concluded.
OneVentures has over $550 million in funds under management and has deployed about $280M in 28 early-stage and growth-stage companies since launching its first fund — the OneVentures Innovation Fund I — in 2010.
Focused on healthcare and technology companies with a global outlook, the firm’s portfolio includes businesses with innovative products tackling multi-billion-dollar world problems — such as Vaxxas in the field of better global health and wellbeing. Others include next-generation learning platforms for quality education through to improved workplace systems and emission reduction technologies for responsible consumption.
Vaxxas CEO David Hoey commented, “Vaxxas is excited to have the financial and operational support of OneVentures. We share passion and dedication about developing patient-focused innovations that can create a healthier world for all. We are committed to rethinking what is possible when it comes to healthcare technologies and wouldn’t be where we are today without the backing and like-minded leadership from OneVentures.”
As well as traditional venture-capital investing, OneVentures was one of the first VC firms in Australia to launch a separate venture-credit fund, which lends to high-growth, early-stage businesses that would find it difficult to borrow from traditional lending sources.
The new ESG policy will also apply to future lending from the credit fund.
View the policy here: https://one-ventures.com.au/responsible-investment-policy