Super fund targets health tech sector with mandate

Synthesis Capital, the investment arm of the MedTech Actuator (MTAC), has secured a mandate from a super fund to target startups in deep health technology amid heightened institutional interest in the sector.

The mandate, coming from HESTA, forms part of Synthesis Capital's integrated investment strategy, aligned to a single venture development and investment pipeline.

The mandate is expected to accelerate the translation of Australian and Asia-Pacific health innovations into global markets, strengthening the region's position in a sector projected to exceed $210 billion (US$150bn) in the coming years, Synthesis Capital said.

The allocation comes as competition for differentiated venture exposure intensifies among institutional investors, particularly in sectors with global growth tailwinds, it said.

Commenting, HESTA deputy chief investment officer and head of portfolio management Jeff Brunton explained the mandate can provide opportunities that deliver positive returns for members.

"HESTA has a proud history of investing in healthcare and medtech as one of the largest Australian super funds dedicated to those working in health and community services, and we recognise the critical need for ongoing investment in early-stage technology," Brunton said.

"Our investment mandate with Synthesis Capital aims to help us deliver strong, long-term returns for members while supporting vital health innovation here in Australia."

Meanwhile, Synthesis Capital managing partner Vishaal Kishore added: "This is a significant step in connecting institutional capital to the earliest stages of health innovation."

"Australia has world-class research and clinical capability, but historically limited access to specialised venture capital at the point where deep technology ideas become companies. This mandate allows us to systematically bridge that gap.

"We are now seeing the emergence of a more complete system for innovation: where research, venture development and capital are integrated. Ultimately this enables companies to scale globally and will help to define the next phase of Australia's innovation economy."

Notably, the company is also progressing its Fund I, with a first close targeted for June, which will enable coordinated capital deployment across pre-seed through to Series A+.

Synthesis Capital has accelerated more than 150 health tech startups, supporting over $200 million in funding raised to date.