When Victoria announced it would wind down LaunchVic and consolidate startup support into Breakthrough Victoria, the questions came fast. Will the ecosystem survive? Should you relocate your startup to NSW? Is this the beginning of decline or just restructuring?
If you’re building a tech company in Victoria, hiring developers in Melbourne, or evaluating whether to stay or move interstate, you need clear answers. This analysis examines the consolidation mechanics, assesses ecosystem health indicators, and evaluates whether this restructuring will work. As we explore in our guide to the LaunchVic closure and consolidation, understanding the mechanics behind this decision is critical for strategic planning.
The short answer: Victoria’s startup ecosystem shows strength in specific sectors, but the consolidation introduces transition risks that will take 18-36 months to resolve. Your success depends less on government programs than on sector fit, funding stage, and strategic positioning.
How Does Startup Ecosystem Consolidation Work?
Government consolidation merges multiple startup support agencies into a unified entity to reduce costs. Victoria is absorbing LaunchVic’s programs and equity investments into Breakthrough Victoria, while moving grant facilitation to Invest Victoria.
The Silver Review recommended cutting $350 million-plus in industry support over four years. Victoria’s expenditure ballooned from $236 million in 2014-15 to over $660 million in 2024-25.
Here’s how it works: LaunchVic’s equity portfolio transfers to Breakthrough Victoria. Grants get absorbed into a new hybrid entity. Invest Victoria becomes the single entry point for all government support.
The theory: streamlined delivery reduces bureaucracy while maintaining support levels. The risk: transitional disruption, loss of specialised focus, and delayed program delivery.
For context, what led to this restructure involved broader public sector reform beyond just startup policy.
What Are the Key Indicators of Startup Ecosystem Health?
To assess whether consolidation will work, you need baseline metrics.
Melbourne ranks 32nd internationally and second in the Southern Hemisphere in the Global Startup Ecosystem Rankings. Sydney ranks 25th. Melbourne gained seven ranks since 2022.
Victoria’s startups achieved $748 million funding across 130 deals in 2024, up 29% from 2023. That’s 19% of total national funding. However, NSW captured 62% of all venture investment since 2020 compared to Victoria’s 22%.
Sydney’s ecosystem is valued at $55 billion. Melbourne’s sits at $18 billion—one-third of Sydney’s value.
Melbourne specialises in deep tech, advanced manufacturing, and life sciences. Victorian startups include Airwallex, Culture Amp, and Seer Medical.
Victoria led Australian states in funding women-led startups, with mixed-gender and all-women teams achieving a 29% deal share. Nine percent went to all-women teams in 2024, up from 3% in 2023.
These metrics provide your baseline for measuring whether consolidation strengthens or weakens the ecosystem over the next 18-36 months.
Will Government Consolidation Work for the Victorian Startup Ecosystem?
Historical evidence shows an 18-36 month disruption period. During this time, program delivery slows and founder confusion increases.
Victoria’s consolidation succeeds if it maintains early-stage funding pathways, program delivery timelines comparable to pre-consolidation, diversity support at current levels, and clear application processes.
Failure indicators: funding gaps at pre-seed and seed stages, program delays exceeding six months, declining diversity metrics, and accelerating founder migration.
Victoria-specific risks:
Breakthrough Victoria’s deep-tech focus may not serve typical SaaS, FinTech, and EdTech startups. If it maintains research commercialisation focus without adapting to serve general startups, that creates a mismatch.
LaunchVic completed over 190 investments and unlocked $1.5 billion in private capital over eight years. Can Breakthrough Victoria replicate that? The organisation posted a $5.7 million loss in its last financial year.
The Alice Anderson Fund closure is the test case. No replacement program exists. If women founder participation rates decline from 29% deal share, that signals failure.
Success depends on execution over the next 12-24 months. Breakthrough Victoria must clarify investment criteria for non-deep-tech startups, publish timelines, and demonstrate maintained funding access.
How Does Victoria’s Startup Ecosystem Compare After Consolidation?
NSW captured 62% of all venture investment since 2020. Victoria got 22%. Queensland 11%.
Sydney’s ecosystem is valued at US$55 billion. Melbourne’s at US$18 billion.
Sydney ranks 25th globally. Melbourne 32nd.
NSW maintained separate agencies rather than consolidating. Queensland increased startup support investment while Victoria reduced it.
Thirty-three percent of founders who relocated cited lack of strong startup ecosystem as primary motivation. If transition uncertainty persists, expect acceleration of interstate migration.
For detailed analysis of how Victorian support compares to interstate competition dynamics, NSW’s maintained commitment to separate agencies correlates with sustained funding growth.
What Happens to Early-Stage Funding After LaunchVic Closes?
LaunchVic supported eight venture capital funds in its final period, enabling $239 million in private capital flow. Those funds continue operating, but new fund formation may slow.
Alternatives:
Breakthrough Victoria offers a $100 million University Innovation Platform for research commercialisation. The BV Fellowship Program offers up to $150,000 per startup. This works if you’re spinning out university IP. If you’re building SaaS or FinTech without university ties, this doesn’t fit.
Startmate provides $120,000 investment per startup with up to $500,000 follow-on funding. University funds including Monash Ventures and La Trobe Eagle partially fill the gap but operate at limited scale. Private VCs concentrate at Series A and beyond, creating a pre-seed and seed vacuum.
The diversity funding gap:
The Alice Anderson Fund deployed $10 million matched by $30 million private capital, targeting 60 women-led startups. No replacement exists.
Alternatives include Atto VC, Scale Investors, and Shepreneur in Victoria. Nationally, the Boosting Female Founders Initiative provides $52.2 million. NSW’s Carla Zampatti Fund offers $10 million.
These don’t replicate the Alice Anderson Fund’s combination of equity, mentorship, and network integration. For analysis of diversity and women founder support, the outlook shows market gaps unlikely to fill.
If you’re building deep tech, Breakthrough Victoria aligns with your needs. If you’re building SaaS, FinTech, or EdTech, you’ll need NSW or interstate funding sources.
For comprehensive available funding pathways, the landscape shifted from distributed access to concentrated sources.
What Is Breakthrough Victoria’s Role After the Consolidation?
Breakthrough Victoria becomes the unified platform for equity investment, but its expanded mandate creates questions about fit.
It started with a $100 million University Innovation Platform for commercialising university research. The platform operates through seven universities including Monash, Melbourne Uni, Deakin, La Trobe, RMIT, and Swinburne.
As of June 2025, $59.5 million in matched funding has been committed.
Now Breakthrough Victoria absorbs LaunchVic’s existing equity portfolio and the Department of Treasury and Finance’s startup investments. It takes over Press Play and other capacity uplift initiatives.
This creates dual mandate: maintain deep-tech focus while serving the broader startup ecosystem LaunchVic supported.
The problem: Breakthrough Victoria hasn’t published updated investment criteria for the expanded mandate.
If you’re building something outside deep tech, you face uncertainty about whether Breakthrough Victoria will invest. That creates hesitation.
Can one agency effectively serve both deep-tech research and general startup communities? Historical precedent suggests specialised agencies perform better than generalised ones.
How Can Founders Navigate the Transition Period?
Invest Victoria is the designated “single entry point” for all government support queries. Contact them first.
Existing LaunchVic commitments and in-flight applications will be honoured. If you already applied, continue through existing channels while they’re operational.
No official timeline exists for when programs fully migrate. Expect 18-36 months for full integration.
Decision tree:
Deep tech or university spinout: Apply directly to Breakthrough Victoria’s University Innovation Platform or Fellowship Program.
General tech (SaaS, FinTech, EdTech) needing equity: Contact Invest Victoria. Be prepared for longer response times.
Need grants: Start with Invest Victoria.
Woman founder: Monitor developments. Consider Atto VC, Boosting Female Founders Initiative, or NSW’s Carla Zampatti Fund if no Victorian replacement emerges.
Risk mitigation:
Don’t bet your growth plan entirely on government program access. Develop contingency plans with private alternatives, interstate programs, or bootstrap strategies.
What Does This Mean for Women-Led Startups in Victoria?
The Alice Anderson Fund closure creates the most visible gap.
The fund deployed $10 million matched by $30 million private capital, targeting 60 women-led startups.
Victoria led Australian states in funding women-led startups, with mixed-gender and all-women teams achieving a 29% deal share. Nine percent went to all-women teams in 2024, up from 3% in 2023.
Without dedicated support, these metrics will likely decline. Globally, all-men teams accounted for 82% of tech startup investments in 2023.
Women-founded scaleups increased value nearly sevenfold, growing 1.2 times faster than competitors over five years. This isn’t just fairness—it’s ecosystem performance.
Ecosystems with targeted diversity programs show higher women founder retention and stronger performance. Removing these creates competitive disadvantage.
Nationally, the Boosting Female Founders Initiative provides $52.2 million. NSW’s Carla Zampatti Fund offers $10 million.
Victorian options include Atto VC, Scale Investors, and Shepreneur, though none replicate the Alice Anderson Fund’s model.
If Breakthrough Victoria doesn’t commit to diversity investment within 12 months, expect decline in women founder participation. That signals consolidation failure.
Watch annual funding reports. If Victoria’s 29% share drops toward the national 18% average or worse, consolidation damaged the ecosystem.
FAQ
Is Victoria still a good place to start a tech company after LaunchVic closes?
Victoria remains viable but faces 18-36 months of transition uncertainty. If you’re building deep tech with university connections, Victoria maintains strong support. If you’re building SaaS, FinTech, or EdTech, you’ll navigate funding gaps. Melbourne gained seven ranks since 2022 in Global Startup Ecosystem Rankings and achieved $748 million in funding in 2024.
Will Breakthrough Victoria support early-stage startups like LaunchVic did?
Unknown. Breakthrough Victoria’s deep-tech focus differs from LaunchVic’s broad mandate. It offers up to $150,000 through its Fellowship Program for university research, but hasn’t published updated investment criteria for the general startup ecosystem.
How long will the transition take?
No official timeline exists. Based on similar consolidations, expect 18-36 months for full integration, with critical questions needing answers in the first six months.
Should I relocate my startup from Victoria to NSW?
NSW captured 62% of venture investment since 2020 versus Victoria’s 22%. Sydney’s ecosystem is valued at $55 billion versus Melbourne’s $18 billion. However, Victoria maintains sector strengths in biotech, cleantech, and advanced hardware. If you’re pre-seed or seed stage in SaaS or FinTech with no university ties, NSW may offer clearer funding pathways.
What happens to existing LaunchVic programs?
The government committed to honouring all existing commitments and in-flight applications. Continue through existing channels. For new applications, contact Invest Victoria.
Where can I find startup funding in Victoria now?
Breakthrough Victoria for deep-tech equity. Invest Victoria for grants. University funds (Monash Ventures, La Trobe Eagle) for pre-seed with university connections. Startmate for $120,000 initial investment. Private VCs concentrated at Series A and beyond.
Will the Alice Anderson Fund continue?
No confirmation exists. The fund closed with LaunchVic, and no replacement program has been announced. Victoria currently leads with 29% deal share for mixed-gender and all-women teams. If this declines in 2025-2026 reports, it signals consolidation failure.
Can the Victorian ecosystem survive without LaunchVic?
Yes, if Breakthrough Victoria maintains funding access, program continuity, and diversity support. The ecosystem includes strong universities, private VCs, accelerators, and established companies. LaunchVic completed 190 investments unlocking $1.5 billion—losing that coordination creates gaps, but infrastructure persists.
Is Melbourne’s startup ecosystem better than Sydney’s?
Sydney is larger and better funded. Sydney’s ecosystem: $55 billion. Melbourne’s: $18 billion. Sydney captured 62% of venture investment versus Victoria’s 22%. Sydney ranked 25th globally versus Melbourne’s 32nd. However, Melbourne gained seven ranks since 2022 and maintains sector strength in deep tech, biotech, and advanced manufacturing.
How do I measure whether the consolidation is working?
Track ecosystem health indicators quarterly: startup formation rates, funding volume by stage, diversity metrics (deal share for women-led teams), and founder retention versus interstate migration. Victoria’s baseline: $748 million funding in 2024 (up 29%), 29% deal share for women-led teams. If these decline or application processing exceeds six months, consolidation is failing.
