AI, Liquidity, and Emerging Funds in Australia with Maxine Minter
2025 ANZ Tech Predictions
Maxine Minter is the first solo female GP in Australia, with her fund CoVentures, a venture fund focused on emerging tech and automation. I caught up for a deep dive into the trends shaping 2025, the challenges of fundraising, and where Australian and New Zealand founders should be placing their bets.
Jess: Max, it’s so good to catch up! Let’s start with what you’re most excited about in 2025, what sectors, business models, or technologies are on your radar?
Maxine: I’m really interested in the automation of services. It feels like we’re at a pivotal moment where AI isn’t just theoretical, it’s being applied in ways that can fundamentally change how service industries operate. We’re seeing a wave of AI-driven efficiency that will be transformative.
Beyond just efficiency, I think we’ll see AI enable completely new business models and revenue streams that weren’t possible before.
This shift will be particularly impactful in industries like legal, finance, and healthcare, where automation can replace repetitive tasks and free up professionals for higher-value work.
I’m also curious to see how liquidity plays out this year. The consolidation of capital behind known brands in venture is tough for emerging managers, but I think we’ll see shifts as more liquidity comes into the market.
Jess: When you say liquidity, are you talking about IPOs, exits, or secondaries?
Maxine: Two big levers: M&A and IPOs. The US has been particularly hostile to M&A due to regulatory scrutiny, the Figma acquisition being blocked is a prime example. That has a ripple effect on mid-tier exits, which typically bring liquidity back to LPs around years 5–7 of a fund’s life. Without that, timelines stretch longer, and capital deployment slows down.
In Australia, we face a different challenge, our corporate buyers don’t really use M&A as a strategic lever for growth. Tech acquisitions aren’t as common here, with the exception of companies like CBA. Many of our large corporations still prefer organic growth or traditional partnerships over acquiring startups, which limits exit opportunities for founders. This means liquidity for Australian startups often depends on international buyers, particularly US-based tech giants who are more accustomed to strategic M&A as a growth mechanism. Additionally, there's hesitation from local investors due to perceived risk in tech acquisitions, and many larger Australian firms lack the internal capability to integrate acquired startups effectively. As a result, even strong startups often look overseas for their exit opportunities, further reinforcing this cycle.
Jess: What’s your take on the venture fundraising environment right now? Are you seeing more interest in emerging managers, solo GPs, or niche funds?
Maxine: It’s tough. In the US, we saw 75% of venture capital go to brand-name funds in 2024. Of that, 14% went to General Catalyst and 16% to Andreessen Horowitz. That’s a huge consolidation of capital, which makes it harder for new managers to break through.
Historically, about 50% of first-time fund managers raise a second fund. Right now, that number is closer to 15%.
Raising a second fund is incredibly difficult, let alone scaling up to a larger fund size. That’s why we’re seeing fewer micro-funds and emerging managers than before.
Jess: And in Australia? Do you think we’ll see more solo GPs and emerging funds?
Maxine: I think we’ll see continued growth in emerging managers, but it will be slow. Our startup ecosystem has matured, but capital allocators haven’t grown at the same pace. As liquidity improves, high-net-worth individuals and family offices will likely cycle back into earlier-stage investments.
One challenge is that our biggest funds, like Airtree and Square Peg, are consolidating their capital into existing portfolios rather than writing lots of new checks. They’re making around 7-8 investments a year, which isn’t enough to sustain the broader ecosystem. We need a strong pipeline of angel investors and smaller funds to support early-stage companies.
Jess: What do you think about valuations this year? Are we seeing a correction, or will they keep climbing?
Maxine: They’ll keep climbing, but not dramatically. If we get blockbuster IPOs, that could shift sentiment and bring more capital into the market, but funds take time to spin up. I expect valuations to grow in line with inflation, maybe slightly faster.
A big wildcard is global stability, if we avoid major conflicts and liquidity improves, we could see a more optimistic funding environment by the end of the year. But they’re like lead time for being able to stand up a fund to push back into market isn’t two months. It’s more like six, minimum. So I think the first half of the year, I would expect to see in line with inflation-style growth, maybe slightly faster. Back half of the year is a little bit more of a wild card.
Jess: How do you think AI will shape the ecosystem this year? It seems like every pitch is “X + AI.”
Maxine: AI is becoming embedded in every business. I don’t think people will say, “I’m an AI investor” anymore, it will just be assumed that AI is part of the tech stack.
The real distinction will be between companies building AI infrastructure versus those applying AI in their business models. But if a company’s operations, product, and go-to-market strategy are all scaled with AI, does it even make sense to ask whether it’s an “AI company” anymore?
Jess: Last question, what’s your advice for Australian and New Zealand founders in 2025?
Maxine: Build a great company. Focus on execution. Sentiment always lags reality, so founders will probably feel frustrated that capital isn’t moving as fast as they’d like. But strong businesses will find a way.
We have deep expertise in services and a growing pool of technical talent. If we bring those together, we can lead in automation, AI-driven efficiency, and vertical SaaS.
Also, be patient. Liquidity is coming, and with it, more investment opportunities. In the meantime, build something undeniable.
Jess: Amazing insights, Maxine. Thanks for catching up!
Maxine: Thanks Jess!
About CoVentures