September Newsletter
Macro
As we progress through 2024, the global economic environment is marked by several critical factors that are shaping investment landscapes:
US Election Uncertainty: With the US presidential election approaching, market volatility has increased. Historical data shows that elections can significantly impact market performance. For example, during the 2020 election year, the S&P 500 experienced a 37% drop from February to March before recovering, illustrating the potential for election-related volatility.
Tensions with China: The trade war between the US and China, which began in 2018, has had far-reaching effects on global trade. According to the World Bank, global trade growth slowed from 3.0% in 2017 to 1.2% in 2019 due to these tensions. The ongoing trade disputes continue to create uncertainties in international markets.
Volatile Public Markets: Public markets have faced increased volatility in 2024, with the VIX Index, a measure of market volatility, showing a significant rise. As of mid-2024, the VIX has averaged around 22, up from a historical average of 15, reflecting heightened investor anxiety and market fluctuations.
Expect continued volatility in the public markets for the long term. In these uncertain times, diversification is a crucial strategy for buffering against market volatility and economic changes. By investing in private markets and focusing on areas with lower geopolitical tensions, you can create a more resilient and balanced portfolio. Embracing this approach helps you navigate challenges with greater confidence and stability.
Startups
The focus on this newsletter is on Australia! Australia has long been a powerhouse of innovation, with its contributions to deep tech making waves on a global scale. From pioneering quantum computing to life-changing medical breakthroughs, here’s a look at some of the most significant innovations emerging from the land down under.
Australia's deep tech innovations, including UNSW's quantum computing breakthroughs, Graeme Clark's cochlear implants, CSIRO's Wi-Fi technology, UNSW and Sundrive's solar advancements, Ian Frazer's Gardasil vaccine, ResMed's respiratory care devices, CSIRO's agritech solutions, Fleet Space's IoT nanosatellites, and Bionic Vision Australia's work on restoring sight, have made a significant global impact across multiple industries.
I had the privilege of attending Cicada Tech 23, where I witnessed firsthand the incredible talent and innovation within Australia’s deep tech startup ecosystem. Out of the 23 startups showcased, I was particularly excited by the following:
Aquila Earth is building a wireless energy-transmission system. They are working to create a global energy-transmission network by bouncing laser energy around the world with orbiting mirrors and adapted solar panels. This global energy transmission system is technically viable, and exponential drivers in photonics and renewables are culminating in substantial near-term economic opportunity. Aquila aims to accelerate the clean energy transition by building energy networks of light. They believe dynamic, wireless energy distribution will be instrumental in powering an abundant and sustainable future.
Most recent news: Aquila was recognised as a top 100 innovator in Australia 2023.
Agscent is using NASA technology to improve life on planet Earth through its non-invasive farm livestock diagnostic testing for pregnancy and disease. This will improve livestock and dairy operator productivity, decrease costs, reduce operator injury, and improve animal welfare
Rhizocore Technologies produces locally-adapted mycorrhizal fungi to enhance tree planting success. By working with native fungi, they offer a sustainable solution to accelerate woodland regeneration, improve forest productivity, and increase natural capital benefits.
Most recent news: Rhizocore was featured in Sustainable Business Magazine.
Extraterrestrial Power is building an electricity grid in space to power the industry. They do this by developing power transfer systems and radiation-tolerant solar cells for space that can be mass-manufactured at low cost.
They aim to deliver affordable power to humanity in space. After supporting space and Lunar missions with the advanced silicon solar cells, they are aiming to produce electricity on the Moon from locally sourced ingredients, aka entering into the Lunar ISRU (in situ resource utilization) field. Extraterrestrial Power also provides services related to electricity, spacecraft electrical subsystem design, solar arrays and electrical engineering.
Most recent news: Extraterrestrial Power was displaying their solar cells and modules at the Australian Space Summit 2023.
Azaneo develops lightning-fast electric weeding technology - using only electrons - to unlock herbicide-free farming. The Electric Weeding harnesses the power of rapid electrical pulses to instantly destroy plant cells. This technology removes the need for herbicides, and also completely negates issues like spray drift and herbicide resistance. The company aims to electrify agriculture and reduce the chemical intensity of farming globally. Their technology will enable farmers to control all weed species without waiting for the perfect weather conditions.
Roam Technologies is revolutionizing oxygen therapy with JUNO, an intelligent portable oxygen concentrator (iPOC) that delivers over 1 liter of continuous oxygen flow, equivalent to leading 5 liters-per-minute pulse-dose units. It provides 90% medical-grade oxygen (+/- 3%) and is 50% smaller than traditional continuous flow devices, significantly enhancing the lives of those dependent on oxygen therapy.
Tetratherix is pioneering the world's first smart Biostealth polymer technology, which delivers treatments through the skin, blood vessels, or nose, forming a matrix that remains invisible to the body and avoids foreign-body reactions. Initially commercialized for regenerative applications, it is now being adapted for mRNA delivery. Tetratherix aims to extend and improve the lives of 10 million people globally over the next decade by applying Tetramatrix technology in various clinical contexts.
Convergence Medical is developing the world's first arthroscopic robot to modernize outdated and unreliable arthroscopy equipment. Featuring up to five arms with flexible, miniature cameras, this robot ensures safer operations and broader anatomical access. With US FDA breakthrough status (achieved by fewer than 3% of submissions), it replaces the need for multiple healthcare workers and devices with a streamlined, advanced solution.
dermR Health is tackling the inefficiencies in skin cancer diagnostics with the Derm Patch, a groundbreaking microneedle device designed to prevent 1 billion avoidable skin biopsies. By painlessly collecting skin cells for genomic analysis, this device enables screenings for all types of skin cancer, including melanoma, using just a few cells. It aims to reduce the over 40% of biopsies that are benign, saving healthcare systems billions in the process.
The fund is now ready for its first close. We will be partnering closely with Decile Partners, who will provide a comprehensive suite of services, including deal reviews, legal operations, fund accounting, real-time reporting, and strategic advisory support.
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