Accelerating Local Tech – How Eastend Ventures is Investing in Adelaide’s Innovation Ecosystem

There is a little-known rule in Australia’s early-stage venture capital market. 

If an investment firm structures their fund as an Early Stage Venture Capital Limited Partnership (ESVCLP), can raise more than $10 million, and has the fund approved by AusIndustry, the investors benefit from capital gains tax free returns (up to $250 million per company) and up to 10% tax offsets.

As South Australia’s first ESVCLP, Eastend Ventures’ Fund 1 is enhancing access to capital and global investment networks for local innovators in the Adelaide CBD.

Founded by JD Sheard and Josh Garratt to address a gap in the locally tech ecosystem, Eastend Ventures contributes to the growth, capability and maturity of Adelaide’s startup and innovation sectors.

“We see every ambitious company in the city looking for funding,” co-founder Josh Garratt says.

“Because capital is harder to come by in a smaller market like Adelaide, founders here tend to be revenue-focused rather than reliant on endless funding rounds,

“That's a feature, not a bug. As investment managers, we get to back early-stage companies with real technology, real revenue, and the hunger for hyper growth.”

Capitalising on the city’s ongoing investment in innovation, Eastend Ventures recognised Adelaide’s potential on the world stage.

Flagship precincts such as Lot Fourteen, alongside hubs including BioMed City, Tonsley Innovation District and Mawson Lakes, are helping to build a dense and collaborative ecosystem.

“Adelaide is genuinely untapped, and the ecosystem has quietly become one of the best in the country” Garratt says

Garratt enjoys the hands-on aspect of investing in early-stage, with the close-knit nature of Adelaide’s investment community proving an advantage when establishing the firm.

“We're not just supporting local companies ourselves; we're also bringing local investors on the journey, and other VCs in to invest alongside us, with the comfort of knowing there's a local firm actively involved in driving the companies’ success,” he says.

“There's a camaraderie that comes with a city the size of Adelaide.”

Fostering these close relationships has been a highlight for the firm, which has already seen their investment deliver strong outcomes through local talent.

Building defence-grade analytics, Priori Analytica has begun working with key international clients, including the Australian Defence Force, the Royal Navy in the United Kingdon and OKI, a supplier to the Japan Maritime Self-Defence Force.

JACKApp, a construction management platform, has seen similar success, garnering more than $1.5 million of annual recurring revenue since Eastend Ventures’ initial investment.

“These are the kinds of outcomes you can build out of Adelaide when you back the right founders. Their success is our investors’ success too,” Garratt says.

Looking to the future, Garratt says that he is excited to discover more local talent and showcase Adelaide’s strengths to international investors.

“The research coming out of our local institutions and universities is exceptional. Access to skilled people is what builds them, so the calibre of graduates coming through Adelaide's universities matters enormously.”

A curator of the Investor Summit at this year’s SOUTHSTART festival, Garratt reaffirms the power of community and Adelaide’s small but dynamic innovation ecosystem.

“Investors get a first-hand look at the companies being built here and the support founders are getting on the ground,” he says.

“It was a chance to show the rest of Australia how seriously local investors take early-stage tech, and the kind of returns this market is capable of generating.”