Australian Startup Ecosystem 2025: Sydney vs. Melbourne and the Rise of Deep Tech Investment



Australia’s startup ecosystem is flourishing in 2025, gaining global recognition for capital efficiency and innovation. As per Forbes Australia, the country is now the most capital-efficient startup nation worldwide, with a robust valuation of US$360 billion, six home-grown decacorns, and over $4 billion in VC investments in 2024 alone.

Among key drivers is a supportive regulatory environment and initiatives like the National Reconstruction Fund. These efforts attract international capital and boost institutional and superannuation funding, strengthening Australia's startup pipeline.

Sydney: The Powerhouse of Innovation

Sydney leads with nearly $55 billion in ecosystem value, capturing two-thirds of national VC funding. The Tech Central district, proximity to top universities, and institutions like the Quantum Academy and Cicada Innovations drive breakthroughs in AI, digital health, and cybersecurity. The city's connection to Asia-Pacific and high-end engineering talent further attracts global investors eager to enrich the Australian startup ecosystem.

Melbourne: Deep Tech & Research Excellence

Over the past decade, Melbourne has become home to some of the most promising startups. The list includes brands like Airwallex, Culture Amp, and Seer Medical. Watch closely and you’ll see how most prominent players in Melbourne’s tech scene have their roots in university research labs and strong IP commercialisation pathways.

Deep Tech Investment: Fuel for the Future

Deep tech now comprises 20% of global VC, with deals like Harrison.ai ($270M), AdvanCell ($270M), and RayGen (A$127M). Climate-conscious capital is flowing into hydrogen, battery tech, and precision agriculture, spurred by Australia's renewable edge.

VC Trends 2025: Lean, Smart, Strategic

Australia’s VC landscape is leaner and sharper. Larger Series B/C rounds are closing faster, with a shift toward capital efficiency. Lower startup valuations (vs the U.S.) attract global investors, while super funds and dual-track strategies drive growth.

Read full article here - Australian Startup Ecosystem 2025: Sydney vs Melbourne | Deep Tech Investment

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