The Future of Venture Captial and Philanthropy: A Conversation with Daniel Petre
ANZ Tech Ecosystem Predictions for 2025
The startup ecosystem in Australia and New Zealand is evolving, and so is philanthropy among the region’s wealthiest individuals. Daniel Petre, one of ANZ’s most influential venture capital investors and philanthropists, has a front-row seat to both these worlds. In this conversation, he shares insights on how venture capital is changing, the need for liquidity events, and why Australia still lags behind in philanthropy.
The Venture Landscape in 2025: More Exits, Growth Equity, and Institutional Capital
Jess: Daniel, great to chat to you, let’s jump in. How do you see the startup landscape evolving in 2025 in terms of funding and opportunities?
Daniel: At a macro level, we’re going to see a lot more M&A activity and exits. Many of the early and first venture funds from 2012 to 2014 are running out of time. Even with extensions, they can’t keep rolling forward indefinitely. Venture firms need to push for liquidity to return capital to LPs.
I’ll quickly pause the interview here to explain what that means:
Venture capital firms have a fiduciary responsibility to their Limited Partners (LPs), the people and institutions (like pension funds, family offices, and endowments) that gave them money to invest. That means they’re legally and ethically obligated to maximise returns for their investors, not just sit on startups indefinitely.
Most VC funds run on a 10-year timeline, meaning they have about a decade to invest in startups, help them grow, and eventually sell their share for a profit. Sometimes they get extensions (an extra couple of years on the fund timeline), but at some point, they have to cash out, whether that’s through an IPO, a big acquisition (M&A), or selling their shares on the secondary market.
If a VC firm doesn’t push for liquidity, they’re not doing their job. Their LPs didn’t give them money just to hold onto cool startups, they need returns. That’s why Daniel thinks we may see a lot more M&A activity and exits: funds from 2012-2014 are running out of time, and the clock is ticking to get money back to investors.
Daniel: Some of these exits won’t be at the ideal time for founders. It might not be a grand IPO or a perfect M&A deal, just a necessary exit for the fund. This is where growth equity comes in.
Historically, growth equity wasn’t significant in Australia because we lacked a large pre-seed and seed ecosystem a decade ago. Now that we do, there’s an emerging need for funds that can take companies from Series B to later-stage growth.
We’ll also see continued growth in venture debt. Founders are more conscious about dilution than ever before, and rather than continuously raising equity, many will opt for venture debt as an alternative financing mechanism. This is something that is far more developed in the US but is slowly becoming more common in Australia.
Jess: Do you think the big VC firms will expand into growth equity, or will new firms emerge?
Daniel: Both. The big three, Blackbird, Airtree, and Square Peg, already have opportunity funds, but there’s also room for dedicated growth equity firms. We simply don’t have enough capital in that space right now. At the same time, we’re seeing a shift in where funding is coming from. Historically, high-net-worth individuals (HNWIs) created the Australian VC ecosystem. Without them, it wouldn’t exist. But moving forward, we’ll see more institutional money, superannuation funds, overseas pension funds, and endowments.
This shift is good for large firms with proven track records, but bad news for smaller, first-time funds. HNW’s aren’t as active in VC anymore, and institutions won’t back small funds, which means many won’t get their second fund off the ground.
Jess: Another trend you’ve mentioned before is the rise of vertical-specific VC funds. Do you see that happening in Australia?
Daniel: Not yet, but I’d love to see it. In the US and Europe, you have strong, domain-specific funds in medtech, climate tech, and agtech. Australia doesn’t really have that yet, most of our VC firms are generalists. The challenge is that deep-domain sectors like medtech require specialised knowledge, and you can’t be everything to everyone. It’s something we need more of.
Another area that’s becoming increasingly important is responsible investing. ESG (Environmental, Social, and Governance) factors are no longer just a box-ticking exercise. Institutional investors are pushing for more transparency on impact metrics, and we’re starting to see more venture firms incorporate sustainability and social impact into their investment theses.
Why More Tech Founders Should and Could Step Up in Philanthropy
Jess: Let’s shift to philanthropy. A few years ago, I recall seeing you on a panel saying philanthropy in Australia is ‘shit’ . Has anything changed since then?
Daniel: At a macro level, Australia is still a country of greedy, selfish billionaires. The wealthiest Australians still allocate very little to philanthropy. The data is clear, we are not a generous country when it comes to high-net-worth giving.
That said, there are some bright spots. The tech sector, in particular, has shown a real shift. Tech founders are far more open to philanthropy than traditional business leaders. Many recognise that luck played a role in their success, and they want to give back.
I’m also hopeful that the wave of M&A activity in 2025 will lead to more founders setting up philanthropic foundations. It’s not just the billionaires, if a founder exits with $30 million and puts $3-4 million into a foundation, that’s a great outcome. It’s a test of whether philanthropy is truly growing, not just among the ultra-wealthy but among those who achieve significant, yet not stratospheric, wealth.
Jess: How do you engage founders in philanthropy? What’s the best way to get them to start giving?
Daniel: It’s hand-to-hand combat. Most founders have never even been asked to think about philanthropy. No one has explained the tax benefits, the structures, or the impact they can have.
Once they start the conversation, it’s a year-long process. They go away, think about it, talk to their partners, and slowly get ready to act. But once they do, the impact is enormous. We had one founder in Queensland who exited at $300M and instantly put $100M into philanthropy. That’s the kind of shift we need.
One of the biggest differences I’ve noticed is that with traditional wealth, I had to convince people why they should give. With tech founders, that’s not the issue. They already believe in the need to give back; they just need guidance on how to do it effectively. Haha, at least I don’t have to fight them on the concept like I used to!
Jess: That’s incredible. What’s next for you?
Daniel: More impact work. We’ve built 141 water bores in Uganda and are adding 50 more per year. Next, we’re layering on food security, hybrid seeds to improve crop yields, ensuring kids get proper nutrition.
It’s about compounding impact over time. You start with clean water, then food, then education. Layer by layer, you transform an entire region.
Jess: That is fantastic. Any last thoughts on 2025?
Daniel: More exits, more growth equity, fewer emerging managers getting their second fund, and hopefully more founders stepping up in philanthropy.
2025 is going to be a defining year. Let’s see who adapts..
A huge thanks to Daniel for his insights. If you enjoyed this conversation, subscribe to Built Different for more interviews on venture, startups, and impact investing.
About Daniel and Startgiving
Daniel is a leading player and investor in the technology industry and has been for more than 35 years, including time working for Bill Gates at Microsoft’s headquarters in the US. He co-founded AirTree Ventures, Ecorp and Netus, producing outstanding returns and establishing many (now) mainstream technology and media companies.
StartGiving was founded in 2022 by Daniel, and is focused on inspiring tech founders and executives to start their philanthropic journey now by establishing their own foundations. The goal of StartGiving is to establish a culture of giving in the innovation community so that giving becomes the norm in Australia, not the exception.
In addition to fully funding StartGiving, Daniel and his wife Carolyn established the Petre Foundation which has donated more than $25m to a range of charities over the years.
Daniel has served on a range of corporate and not-for-profit boards. Currently Daniel is Chairperson of the Board for Vera Living, and is an Advisory Committee Member for the Community Capital Credit Fund. He is also a Board Member of the National Reconstruction Fund, the biggest investment in Australian manufacturing capacity in living memory. Daniel is the author of a number of books across a range of topics.