We’re often described as a Series A investor. There’s some truth to that. We’ve led and joined a number of Series A rounds over the years, but that’s not the full story.
At Shearwater, we invest across three areas:
- Early – Inception and seed (see Zabidou, Lokol, Remarkable)
- Growth – Series A and beyond (see Lyka, Nexl, Sitemate, Ideally)
- Scaled – pure secondaries (see Vivi and Sitemate)
Our view is simple. If we find exceptional founders, the stage does not define the opportunity. The people, the insight, and the potential to build something that lasts do.
A few consistent patterns guide how we invest, regardless of stage:
- People come first – We look for founders with high integrity, strong judgement, and are people we want to work with over the long term.
- We focus on recurring revenue – These businesses tend to have clearer economics and predictable growth.
- We’re drawn to technology-led companies – But we’re not rigid. Our investment in Lyka, a consumer business, is a good example. We were drawn to exceptional founders, a highly engaged customer base, and strong underlying technology infrastructure.
It’s equally important to be clear about where we don’t invest. We focus on companies based in Australia and New Zealand. Staying local allows us to work closely with founders and be meaningfully involved as they grow. We don’t invest in foreign markets. We also avoid areas where we lack conviction or experience, including blockchain, web3 and vice-led industries.
We invest our own capital, which allows us to operate without the constraints of traditional fund structures.
Our flexibility to invest across all stages means we don’t have an average cheque size. Our first cheques have been $200k in some cases, and $5m+ in others.
What do we look for at inception or Seed?
In the absence of clear and growing traction, our approach is simple: back founders with exceptional capability and conviction. At the earliest stage, most of the usual signals don’t exist. There is often no revenue, limited customer data, and little reliable traction. What exists instead is a set of assumptions, an early product that may change, and a market that may behave very differently from how it appears on paper.
In that environment, the founder matters most. We look for founders with domain expertise, strong judgement, and the ability to navigate uncertainty. Founders who create momentum, iterate quickly, can hire well and adapt as they learn. When we see this, we’re comfortable investing before the data exists.
What do we look for at Series A and beyond (including secondaries)?
By this stage, there is usually enough data to move from theory to evidence. Our focus shifts to demonstrated execution, while still anchoring conviction in the founders behind the business. We spend real time in the numbers. Growth, retention, expansion and usage, understanding how the business is performing beneath the surface.
We’re drawn to companies with strong, consistent revenue growth, high-quality recurring revenue, and healthy margins. Businesses where customers stay, expand, and the technology becomes embedded over time.
Throughout all of this, the founder remains central. The data tells part of the story, but it is the people making the decisions who determine how it unfolds.
When both strong execution and strong founders are present, we lean in.