The federal government sponsored Australian Business Growth Fund (ABGF) has invested $15 million in Melbourne-based online retail business DIY Blinds in a transaction that values the company at around $100 million.
ABGF said it had invested in DIY Blinds because of its disruptive business model which is supported by accelerating growth within the Australian home improvement industry. DIY Blinds’ business is based on making it easy to buy premium window furnishings online rather than through physical retail outlets and is committed to supporting Australian manufacturing by selling Australian made products.
DIY blinds offers a fast seven-day turnaround service and employs a team of more than 50 design consultants to help customers with their orders.
The company was founded in 2015 by Evan Montero and Liam Dobson. The founders met while working in the superannuation industry, but both had entrepreneurial ambitions and decided to start their own business.
Montero said: “Liam and I saw a clear gap for this type of product in the window furnishing market. We decided to build a business that would give consumers a better experience and access to a high-quality product.”
Dobson added: “The industry is primed for disruption with a clear need for an online model. ABGF’s investment will provide an opportunity for us to further future-proof the online customer experience, expand business operations nationally, build brand awareness and fast-track new product offerings in our pipeline.”
The investment will enable DIY Blinds to launch HomePro, a commercial division intended to service builders, architects and designers.
ABGF co-head of investments Ghazaleh Lyari said: “DIY blinds is an innovative online business within the home window furnishing space that has disrupted he traditional marketplace and continues to show considerable growth within Australia.”
DIY Blinds was advised on seeking expansion capital by Melbourne corporate advisory firm Vesparum Capital. Vesparum founder and chief executive Timothy Toner said a combination of DIY Blinds’ rapid growth, compelling financial metrics and capital-light business model had attracted interest from a range of investors across growth capital, private equity and family offices.
DIY Blinds’ banking partner is NAB. NAB group executive for business and private banking, Andrew Irvine, said the bank regarded ABGF as a “fantastic option” for small and medium sized businesses to gain access to long-term growth capital. He said the bank was pleased to support DIY Blinds to grow at a faster pace.
The independently managed ABGF was set up in 2021 as a public-private partnership between the Federal Government, Australia’s big four retail banks plus Macquarie Bank and HSBC. The fund had initial capital of $540 million with the federal government expecting it to grow to more than $1 billion over time.
The fund is intended to fill a capital funding gap between late-stage venture capital and private equity, with private equity tending to be focused on larger deals and shorter target time frames of three to five years.
To qualify for ABGF funding, businesses must have proven their business model and be generating more than $2 million in annual revenue.
Unlike private equity, which usually takes controlling stakes, ABGF takes minority stakes (maximum 49%) ensuring founders can retain control. The primary purposes of ABGF investments are to support growth and connect businesses to capital, expertise and wider local and international networks.
ABGF’s business model was based on that of the UK’s Business Growth Fund set up in the wake of the Global Financial Crisis of 2008. The UK fund has since invested £2.7 billion ($4.7 billion) in more than 400 companies, making it the most active investor in private equity in the UK by number of transactions.
DIY Blinds is ABGF’s sixth investment. The fund recently invested in Victorian company Steel Mains.
Image: DIY Blinds founders Evan Montero and Liam Dobson (seated) with ABGF investment team members Lori Broner, Ghazaleh Lyari and Lucinda Bradshaw.