He said of the roughly $100 million new fund, $40 million was earmarked to make investments in new companies, of around $500,000, and $60 million would be used for follow-on rounds in already funded start-ups that were growing well.
Among its extensive portfolio of existing investments, Possible has backed numerous Australian start-ups, including Uluu, which is making a plastic replacement out of seaweed; renewable energy transmission start-up Aquila; Kite Magnetics, which makes electric motors for sustainable aviation; and Psylo, which makes psychedelic-inspired medicine to treat mental illness.
Unlike some of the larger VC funds, Mr Hitchen says Possible never looks to be the lead investor, or take board seats, rather it co-invests with other firms, using its track record to convince founders that they are a good strategic backer to have on board.
Big pay-off
Sorare is its most obvious success, being valued at $US4.3 billion back in 2021, but it was also the first investor in Munich-based vacation rentals business Holidu, which has since raised $US200 million, and was an early investor in Australian start-up Pin Payments, which was acquired by Checkout.com.
“We want to invest at the earliest stages in companies, and it is much easier to do that if you’re investing alongside other funds … We see lots of deals through other funds, which lets us be a global investor, while having a team of seven people,” Mr Hitchen said.
“The large funds love to have Possible [as a co-investor] because we don’t compete with them for ownership, we’re happy with smaller percentages, and we actually bring this global network of support that makes a company stronger.”
Essendon captain Zach Merrett is an investor in Possible Ventures. AFL Photos
In an era of huge super fund-backed VC funds, Possible actively eschews that, with Mr Hitchen saying he wants his team’s remuneration to be based on successful investments, rather than management fees.
Possible has about 200 investors – or limited partners – including Spanish, German and UK funds-of-funds Aldea, Equation and Molten, and the founders of large technology companies including Signavio, Metaswich and Kinexon.
Big names from the Australian tech VC scene including Square Peg’s Paul Bassatt, AirTree Ventures co-founder Daniel Petre and Reinventure’s Danny Gilligan and Simon Cant are Possible LPs.
Mr Hitchen has also racked up sporting figures as investors, including German World Cup-winning footballer Mario Goetze, and AFL players including Essendon captain Zach Merrett and former Essendon star Cale Hooker.
“These AFL guys are completely aware that their careers are done at 30-something, and they don’t earn that much money as it’s such a short career, and they want to diversify,” Mr Hitchen said.
“They are engaged, and they are trying to use the celebrity status or the networks they have, and I think that’s great. They are also great for start-up founders, who can talk with them about high-level performance and training, and all sorts of things that can be valuable.”
