Australia has one of the world’s most capital-efficient startup ecosystems analysis of the local venture investment market reveals, creating bigger and better tech companies for fewer dollars.
The Australia Venture & Startup Report 2025, from Sydney VC Side Stage Ventures in collaboration with Dealroom and AWS, set out to benchmark the performance of local venture funds against global markets.
It gives the nation the gold medal for creating unicorns – companies valued at least $1 billion – per VC dollar invested, with Australia delivering 1.22 unicorns from every US$1bn in VC capital.
That’s despite deploying a fraction of the capital seen in overseas markets such as the US and Europe.
Australia is in fifth place for decacorn ($10bn valuation) creation.
Of course the podium has three well-known stars – Canva, Atlassian and Afterpay, but the report argues that a maturing ecosystem with a robust pipeline of venture-scale companies has emerged subsequently due to favourable conditions such as education, research and development and talent.
Side Stage Ventures cofounder Ben Grabiner argues that Australia has long been underestimated as a startup hub.
“This report confirms what we’ve known for some time: the Australian startup ecosystem is quietly emerging as one of the most compelling yet undercapitalised ecosystems in the world,” he said.
“The data tells a powerful story. Despite just a fraction of the venture capital deployed compared to its peers, Australia has produced some of the best and biggest technology companies outside of the US and China, and it has the highest unicorn efficiency ratio of any country anywhere.”
Gardiner said it shows how far the local startup sector has come, yet it remains undercapitalised, especially when it comes to early-stage investment.
“It’s time we realise the opportunity that is upon us. Australia now has a chance to grasp the moment and cement its position as a true world leader in producing exceptional global technology companies,” he said.
Interesting it also shows a changing investor appetite from an initial focus on enterprise software and fintech, towards energy, health and media.
Other key findings include:
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Big outcomes with less capital: Despite raising less than US$34 billion in total VC funding since 2000, Australia ranks fifth in the world for decacorn creation. With six decacorns – including Canva, Atlassian, Afterpay, Wisetech Global, AirTrunk and REA Group – Australia is behind only the US, China, the UK and Israel in decacorns created.
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Second-fastest growing ecosystem globally: Australia’s combined ecosystem value has increased by 6.5 times since 2018 and 2.5x since 2020 to reach US$360 billion (A$547bn), making it the second-fastest growing venture ecosystem globally.
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Seed stage remains undercapitalised and reliant on overseas investors: Fewer than 30 active seed funds that completed five or more deals in the past year, far behind peer markets like the US (601) and Europe (525). Further to that, just 61% of early-stage funding is locally sourced, compared to 73% in Europe and 80% in the United States.
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New frontier sectors are emerging: Investor appetite is moving away from enterprise software and fintech and toward fast-growing opportunities in energy, health and media
Dealroom founder Yoram Wijngaarde said the Australian tech ecosystem offers a “pretty compelling combination” of rapid and efficient value creation.
“It’s been exciting to watch the Australian tech ecosystem come of age in the last five years. The combination of major tech success stories, engaged regional and national policy makers, and growth momentum means the ecosystem is reaching a level of completeness and critical mass,” he said.
“The numbers show the efforts are already paying off, and it’s a perfect base from which to build a top international tech ecosystem.”
Download the Australia Venture & Startup Report 2025 here.
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