Seed funding venture capital specialists Ben and Tony Heap today launched H2Ocean, an ASX-listed vehicle to raise up to $55 million for the fintech startup market.
The prospectus, offering $1.10 shares to raise between $27.5 million and $55 million, is now live and is being led by Ord Minnett and Shaw and Partners.
The float, due to list around October 19, was launched by treasurer Scott Morrison.
Joining the brothers on the board are financial journalist David Koch, former federal MP Wyatt Roy and Anne O’Donnell, a former CEO of Australian Ethical Investment.
Ben, the chairman, told Business Insider the company is a first to list on the ASX.
“This is a listed venture company, the first of its kind, and it’s a way for retail investors to be able to access fintech venture capital,” Ben says.
“It’s an asset class that traditionally has not been available to all investors
“Fintech provides a hedge against the risk of financial services disruption. It’s the equivalent of investing in realestate.com and Seek and carsales 15 years ago.”
H2 Ventures, set up by the brothers and operating out of Sydney fintech hub Stone & Chalk, will manage the listed vehicle, H2Ocean, for an annual fee of 1.75% of the net asset value of the portfolio.
The return per year since H2 was set up three years ago has been 46%. H2 has invested in 16 startups.
“That in our minds reflects the really positive characteristics of investing in these early stage funds,” Ben says.
“Only one of our investments has gone out the back door, closed down and been unsuccessful.
H2Ocean is looking to invest in new fintechs looking for seed capital rather than H2’s current portfolio but that doesn’t mean there won’t be some cross investing.
“One of the key benefits, as we see it in the offer, is that we have access to a proprietary proprietary deal flow that we back in our accelerator (H2),” Ben says.
“We certainly have the ability to invest in the best of the opportunities that come through that accelerator.”