Westpac’s Reinventure mulls bringing in external capital

Westpac’s Reinventure mulls bringing in external capital

Westpac’s $150 million venture capital unit Reinventure says it could explore using external sources of capital for its next fund aimed at disruptive financial technology.

Amid investor scrutiny of how banks allocate scarce capital, and following a change of leadership at the banking giant, Westpac’s VC fund is in talks with the bank about whether it may bring in other investors from outside the lender to support its next fund.

Reinventure was launched in 2014 with backing from former chief executive and technology enthusiast Brian Hartzer, and the bank has committed $150 million to the initiative over three separate funds over that period.

The fund, which has taken stakes in more than 25 fintech businesses, has grown amid a boom in Australia’s fintech sector, with rival big banks starting similar programs aimed at backing disrupters.

Westpac has backed three Reinventure funds, the most recent in 2018, and co-founder Danny Gilligan said Reinventure was talking to the lender about potentially bringing in external funders for the next fund. “We are in discussions with the bank about what the make-up of the next fund looks like, and whether that will continue with the bank as sole LP [limited partner] strategy, or whether we will look to external capital to make up part of the fund,” Mr Gilligan said.

A Westpac spokesman said the bank continued to support Reinventure, but it “doesn’t speculate on future investments.”

“We are continuing to actively invest from the Reinventure funds and see ongoing opportunities to partner with our portfolio companies,” the spokesman said.

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