Last year venture capital investments in Australia hit a record high, skyrocketing 36 per cent to US$899.05 million.

Globally VC investments set a new record, jumping from US$175 billion in 2017 to US$255 billion.

The figures come from the quarterly report, Venture Pulse Q4 2018 published by KPMG.

In the last quarter, US$147.1 million of startup investment was recorded in Australia.

This can be attributed to funding deals including Deputy’s US$81 million Series B round, Nura’s US$21 million Series A round and Gilmour Space Technologies US$13.9 million Series B.

Amanda Price, head of KPMG high growth ventures said, “2018 was the biggest year ever for VC investment into Australian startups.

“For the first time we are starting to see a steady flow of major funding rounds over US$10 million aimed at helping locally founded businesses take on global markets. In Australia the diversity of the startups being funded is testament to the scale of the economy and opportunity.”

Price said we need to view this growth in the global context, with global VC investment hitting $255 billion in the same period.

She explained, “In 2019 we expect a pricey climate and volatile market environment which will lead to increasing caution on the part of investors, even though there remains record capital to deploy.”

2019 predictions

Given the strength of VC investment in 2018 in the US, Asia and Europe, analysts predict 2019 might not be going down the same route.

Despite this the report said there will be substantial VC investment globally especially in late-stage deals.

Autotech – autonomous vehicles, alternative energy vehicles and ride sharing – is expected to see strong investment, as well as healthtech, fintech and AI.

In 2019, the IPO market will be one area to watch as including unicorns Uber and Lyft, prepare for IPOs despite the unexpected turbulence in the capital markets at the end of 2018.

Arik Speier, head of technology, KPMG Somekh Chaikin in Israel said, “While the last month of 2018 was highly tumultuous for the capital markets, if it settles down quickly in Q1’19, we may see a number of the aging unicorns looking to exit. If those companies do well, others will follow.”

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