New VC Fund Gives Sydney and Melbourne the Middle Finger, Focuses on 'Literally Anywhere Else’

In what industry experts are calling "the most beautiful revenge story since Kill Bill but with term sheets," a new venture capital fund has emerged with an investment thesis that can be summarised as: "Sydney and Melbourne, we don't know her."

Eastend Ventures, founded by Josh Garratt and JD Sheard, has launched with the revolutionary approach of investing in startups located literally anywhere in Australia except its two largest cities, prompting Sydney VC’s to contemplate a world beyond Surry Hills. "We invest in exceptional founders building the next generation of global technology companies from Australia’s mid-sized markets" explains the fund's website, which sources confirm is just Australian for "get stuffed, Sydney."

The Anti-Harbour Strategy

When asked about the unusual geographic focus, co-founder Josh Garratt was refreshingly blunt. "Have you ever tried to build a startup while paying $4,000 a month for a studio apartment the size of a Tesla glovebox?" Garratt explained. "90% of Aussie VC funds are based in Sydney and Melbourne, and they tend to invest in their cities. We give LP’s exposure to the tech talent beyond the Blue Mountains."

The fund's strategy has been met with confusion in traditional venture circles, where conventional wisdom holds that startups can only succeed if founders can see the Sydney Harbour Bridge or Melbourne's street art from their co-working space. "We've run the numbers," added co-founder JD Sheard.

The Queensland Connection

Sarah Shelton, Eastend's Gold Coast-based Principal, has been tasked with finding Queensland's most promising startups, a job she describes as "like being a talent scout at an uncrowded beach." Industry analysts note that Eastend's approach is particularly appealing to founders who prefer their runway to refer to actual business operations rather than how many months they can afford Sydney rent.

Sydney VCs Respond

The response from Sydney's venture capital community has been predictably defensive, with several prominent VCs insisting that paying $7 for a coffee actually provides "intangible network effects" that are "impossible to replicate in mid-market Australia."

"What about the ecosystem?" protested one Sydney-based VC who requested anonymity because he drives a Tesla. "How can startups succeed without access to our quarterly mixer events where everyone talks about the same three companies?"

Another Sydney VC pointed out that "regional founders aren't constantly hustling," before clarifying that by "hustling" he meant "spending four hours daily commuting."

The Numbers Don't Lie

Eastend's approach might seem contrarian, but it's backed by compelling math. "A million dollars of funding in Sydney gets you approximately fourteen months of operation before you're broke," explained Garratt. "That same million in mid-market Australia buys you about two years, plus a house with a yard, and you might even see your kids occasionally."

The Future of Australian Venture

While it's too early to tell if Eastend's geographic arbitrage will pay off, the fund has already succeeded in making Sydney and Melbourne VCs uncomfortably aware that Australia is, in fact, larger than just two cities. "We're not saying Sydney and Melbourne don't matter," Shelton clarified. "We're just saying they don't matter to us."

At press time, three Sydney-based VC firms were reportedly considering opening satellite offices in regional locations, but were struggling to find suitable cold brew providers.

The Rocket Advocate: Reporting on Queensland's venture capital scene with all the objectivity of someone who doesn't miss two-hour commutes.