Hugh Victor McKay Fund | AgTech Startup Investment | LaunchVic

INVESTMENT SUPPORT FOR AGTECH STARTUPS

LaunchVic Fund

The Hugh Victor McKay Fund is a new sidecar fund for Victorian AgTech startups run by LaunchVic with funding from Agriculture Victoria.

The fund will co-invest between $100,000-$200,000 into at least five early-stage AgTech startups over the next 12 months.

With every dollar of funding to be matched by two dollars of private investment, this will activate more than $3 million in total capital for founders building the future of on-farm productivity and sustainability.

The fund is named after pioneering Victorian inventor Hugh Victor McKay, who patented the original combine harvester in the 1880s – widely credited as one of the most important agricultural innovations in recent history.

Press Release

Investment Committee

Founding Chairman, Scale Investors

Susan Oliver AM (Chair)

Founding Chairman, Scale Investors

Susan Oliver AM (Chair)

Founding Chairman, Scale Investors

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CEO & Co-Founder, shilo.people | CEO & Founder, pivotnow

Ilona Charles

CEO & Co-Founder, shilo.people | CEO & Founder, pivotnow

Ilona Charles

– Ms Ilona Charles is an experienced executive with an extensive career in human resources, transformation and change across a range of industries. 

Ilona has held executive roles with the CSIRO, Aconex, Telstra, Medibank and NAB and is currently the CEO and co-founder of ShiloPeople (shilo.), providing world-class on-demand HR talent and consulting solutions across Australia.

She also founded pivotnow, providing strategic people advice to Founders, CEO’s and Boards of organisations going through significant transition or scaling up. 

Special Responsibilities

– Chair of the People Sub-Committee​

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ADVISOR, INVESTOR AND DIRECTOR, AULTMORE PTY LTD

Amanda Derham

ADVISOR, INVESTOR AND DIRECTOR, AULTMORE PTY LTD

Amanda Derham

ADVISOR, INVESTOR AND DIRECTOR, AULTMORE PTY LTD

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Co-Founder, Tenacious Ventures and Partner, AgThentic

Matthew Pryor

Co-Founder, Tenacious Ventures and Partner, AgThentic

Matthew Pryor

Co-Founder, Tenacious Ventures and Partner, AgThentic

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Application Guidelines

Application Guidelines
Investment Playbook

FAQs

Eligibility

How do you define AgTech

AgTech is the collection of technologies that provide the agricultural industry with the tools, data and knowledge to make more informed, timely on-farm decisions and improve productivity and sustainability. Applications of these technologies can include: plant or animal science, crop protection & input management, precision agriculture, indoor agriculture, sensors & smart farm equipment, imagery, animal technologies, processing & packaging, supply chain and hardware. 

*FoodTech (food production) is generally not included in this definition, unless the business idea is technology based with high impact potential, using innovation and/or addressing scalable markets 

How do you define a startup?

LaunchVic defines startups as young technology-based businesses that use innovation to scale rapidly and capture global markets. Examples of technology include: software / app, artificial intelligence (AI), blockchain, advanced manufacturing & robotics, Internet of Things (IoT), big data analytics, augmented / virtual reality, 3D printing, advanced materials, genomics & life sciences (including BioTech & MedTech) and autonomous vehicles. 

How do you define Victoran-based?

LaunchVic defines Victorian-based as the startup must have at least 50% of its assets and employees located in Victoria and the business must be registered in Victoria. The founder(s) that meet the criteria for “agtech” are persons that have a primary residence in Victoria. 

Who can apply?

Only investors can apply to the Fund on behalf of the startup they are investing in. It does not need to be the lead investor who applies to the Fund, however, the application form does require investors to detail their experience investing in early-stage startups. The fund is open to local and international Angel Networks, Early-Stage VCs and individual investors who must meet the criteria of a sophisticated investor or hold a valid AFSL license, and operate independently from the startup. 

The following applicants are ineligible to apply: 

  • Applications from Startups seeking investment. 
  • Applications from investors into small or medium enterprises (as opposed to startups) 
  • Applications from investors into later-stage startups or scaleups. 
  • Applications from related parties. Related Parties include spouse, child, parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descendent or adopted child. If a relationship exists where services are provided in lieu of equity this is also considered to be a related party. Any funding provided by a public fund or grant also must be declared. The Hugh Victor McKay Fund will not co-invest on the funding provided by related parties or by public funds or grants 

What type of investments will be ineligible for Hugh Victor McKay Fund Co-investment?

Applications from funds utilising only public funding. The Hugh Victor McKay Fund may co-invest in rounds that include funding from public funds but the application must be made by a private sector investor and the Hugh Victor McKay Fund will only leverage investment provided by private investors. 

What type of investments will be ineligible for the Hugh Victor McKay Fund's co-investment?

The Hugh Victor McKay Fund will not co-invest on the following: 

  • Grant funding 
  • In-kind service contributions 
  • Funding provided as part of an entry to an accelerator program 
  • Funding provided by public funds 
  • Related party investments 

The Hugh Victor McKay Fund may still participate in rounds that include funding from related parties, public funds or grants, but the application must be made by a private sector investor and Hugh Victor McKay Fund will only co-invest on the investments provided by private investors. 

How do you define related party investments?

Related Parties include spouse, child, parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descendent or adopted child. If a relationship exists where services are provided in lieu of equity this is also considered to be a related party. Any funding provided by a public fund or grant also must be declared. The Hugh Victor McKay Fund will not co-invest on the funding provided by related parties or by public funds or grants. 

What type of investment instruments do you accept?

The Hugh Victor McKay Fund will co-invest with private investors in priced rounds or via a SAFE Note or Convertible Note 

Can the founder personally invest in the startup?

Funding that founders put into the business is not considered by the Investment Committee. The Hugh Victor McKay Fund will also not co-invest with related party investors. This means, the Fund will not co-invest with any spouse, child, parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descendent or adopted child (or spouse of the aforementioned) of the founders. If the investment round includes co-investment from both related and non related investors, the Hugh Victor McKay Fund will only co-invest on the amount raised from the non-related investors. 

I am eligible for both the Alice Anderson Fund and the Hugh Victor McKay Fund – can I apply for co-investment from both funds for the same funding round?

No. Applicants need to decide whether to apply for funding from the Hugh Victor McKay Fund or the Alice Anderson Fund, as funding from both entities is not possible in the same investment round.

HOW IS EMPLOYEE SHARE OPTION PLAN (ESOP) TAKEN INTO ACCOUNT?

The Hugh Victor McKay Fund will deem ESOP to be on a fully diluted basis (as if the ESOP is diluted at the time of the application). 

Applying for funding

I'M A FOUNDER, HOW CAN I ACCESS THE FUND?

Investors apply on a founder’s behalf for this opportunity, so we recommend engaging with an angel group or VC Fund to access the fund. LaunchVic has funded the establishment of a number of angel groups in Victoria, which you can find at launchvic.org. You can find a full list of investors over at dealroom.launchvic.org. 

Can Retrospective funding be included in the application?

No. Applications must be for a current investment opportunity. We won’t take into consideration amounts that have already been raised and banked with the startup.

AS AN INVESTOR DO I NEED TO APPLY FOR EACH NEW RELEVANT STARTUP?

Yes. If you have previously applied and are submitting an application for a new Investee Company from the same Investing Entity please email investments@launchvic.org to let us know and we will send you a shorter application form, for Investee Company and Deal Information only. 

The application form asks for due diligence to be provided. What due diligence is required?

Due diligence must be provided in the form of a deal memo outlining the investor’s due diligence findings in relation to the Startup. At a minimum the deal memo must include the following: An assessment of the market opportunity, an overview of the traction the startup has had so far, the reasons for investing, an overview of the competitive landscape, use of funds (and runway the funds will provide), key risks and opportunities that have been identified. As the Hugh Victor McKay Fund operates as a side car structure, the Investment Committee are relying on leveraging thorough due diligence process of private investors to inform their investment decision. If you are not the lead investor and you are relying on the due diligence conducted by the lead investor, please upload the deal memo outlining findings of the due diligence conducted by the lead investor. The Investment Committee will not be able to make a decision on any application without a thorough deal memo being provided.

Timing

Does the investment round need to have been finalised before an application is submitted?

The investment round does not need to have been completely finalised before an application is submitted. The application form asks for the minimum and maximum round size to be provided. In order for eligible applications to be approved, startups need to have raised the minimum required for the Hugh Victor McKay Fund investment ($200k) and an indication must be provided of what has been raised to date. The terms of the investment must be included in the application. If an application is successful, at a minimum, the Hugh Victor McKay Fund will co-invest at a 2:1 ratio on the amount raised at the point of application.  The final investment amount is at the discretion of the IC. Typically, investments need to be finalised within three – six months from the date of application. 

HOW LONG WILL IT TAKE TO PROCESS MY APPLICATION?

The Investment Committee meets monthly to assess applications. The meetings are scheduled for:  

  • October 2023 
  • December 2023 
  • February 2024 
  • April 2024 
  • June 2024 

 Applications are accepted on a rolling basis with applications required to be submitted by the following dates to be reviewed at the following month’s Investment Committee meeting:  

  • 19th September 2023 
  • 21st November 2023 
  • 23rd January 2024 
  • 19th March 2024 
  • 21st May 2024 

Once the Investment Committee meeting is complete, LaunchVic will contact you with an outcome within 48 hours. If you have any questions about this timeframe, please reach out to our team at investments@launchvic.org. 

If the investment is approved, what are next steps?

Once the investment is approved by the Investment Committee, LaunchVic will need to see evidence of all investment documentation and co-investment amounts from all investors in the round prior to finalising the investment. LaunchVic will also require a grant agreement be signed for the non-dilutive grant component of the investment. 

Have a question? Contact our team.