Sean Holland

Commencer Capital Pty Limited has acquired IEC Funds Management Pty Ltd, the fund manager of the $60 million Investec Emerging Companies Australia Fund 1 (IEC Fund), from Investec Australia Limited.

The fund has been renamed ‘Commencer Capital Emerging Companies Fund’.

Commencer Capital is a newly established funds and investment management business majority owned by David Phillips, the founder and current fund manager of the IEC Fund.

Commencer Capital is also backed by the Alteris Financial Group, which is a 30% shareholder (and an existing investor in the IEC Fund), with the remaining 20% owned by an offshore investment company backed by a high-net-worth investor.

Joining Commencer Capital are the majority of the existing Investec Emerging Companies team, including Sean Holland, Shane Simon and Alexander Corder. In addition, the existing Investment Committee will remain, including independent members Cliff Rosenberg, Garry Hounsell and Ben Sebel (Ben also acted as co-Fund Manager of the fund for the previous 18 months). Jeff Law, former head of Power and Infrastructure Finance at Investec, will also join and will also act as co-Fund Manager alongside David Phillips.

Simultaneous to the acquisition of the management rights to the Commencer Capital Fund, the Commencer Capital shareholders have committed an additional circa $14 million of new capital into the fund as part of a second and final capital raising (bringing the FUM to $60m). Between the Commencer Capital shareholders and the Investment Committee members, their aggregate investment in the fund will be close to $26m. Investec will also remain as the single largest investor in the Commencer Capital Fund at circa $17m. The fund manager will now also complete a second and final fund raising – targeting total FUM of $90-$100m.

David Phillips, Managing Director and Chief Investment Officer of Commencer Capital, said: “In 2018 we started the Emerging Companies fund to work with and invest alongside new and exciting early-stage Australian businesses. Since that time, the fund has supported eight companies with an average investment of greater than $4 million in each.

“With the strong support of our shareholders we are now able to continue the good work and legacy under the Commencer Capital banner.”

Since its launch in late 2018, Mr Phillips added: “The new capital invested into the fund by the Commencer Capital shareholders, as well as additional capital to be raised, will ensure it is well placed to add to its diversified portfolio and support its existing portfolio companies as they continue to grow and seek additional capital.”

The fund will retain its tax advantaged ESVCLP status as part of the Australian government’s venture capital regime that supports investment in early-stage innovation being developed by Australian companies and their founders.

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