A terrific outcome for founders and angels alike and a proof point of the power of angel investment supporting kiwi tech companies to succeed.

Kiwi software firm SwipedOn has been sold to UK company SmartSpace Software for $11 million.

The British company provides workspace management software and has wanted to expand that offering through an acquisition since July.

Tauranga-based SwipedOn’s software helps visitors sign in when visiting an organisation. Its backers included Ice Angels, Enterprise Angels, New Zealand Venture Investment Fund and K1W1.

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Snowball Effect 2018 Annual Update

2018 has been a record year for Snowball Effect. We have raised more capital than any previous year and continue to grow steadily. Some of the metrics below are disclosed to the FMA as part of our compulsory reporting as a regulated online investment platform. We believe that the private capital markets in NZ can benefit from being as transparent as possible. We’ve recently been collaborating with researchers from the University of Auckland and University of Minnesota to uncover insights into investor behaviour and the growth in online capital raising around the world. Below are some of the highlights from the past year:

Larger offers
We have now raised $41.8 million in capital across 54 offers. The private capital part of the business continues to grow with $12.7 million raised privately in 23 offers. The average size of offers that we work with has been increasing and 13 offers have been over $1 million in size. We have completed 22 offers that attracted more than 100 investors.

Growing investor base
Our investor audience now includes 17,700 people, of whom 7,300 have actively indicated interest in investing in a particular offer. We’ve found that each indication of interest averages out to about $1,000 in investment in the final offer per indication of interest. One of the most important metrics for a two-sided marketplace business is “transacted users”. In our case, 3,100 people have made a completed investment on the platform.

Larger investors
We are now working frequently with large family offices, institutional, and sophisticated investors. 810 people have invested more than $10,000 through the platform and 67 people have invested more than $100K through the platform. There are now 1,400 wholesale investors on Snowball Effect who are eligible to receive private offers. $27.7 million in transaction volume has come from people investing more than $10K.

Increasing diversification
A key difference between Snowball Effect and other players in the online investing space is that we want investors to take the private company asset class seriously as part of their overall investment portfolio. To that end, we’re pleased to see that 33% of our investors have now invested in more than one offer and 14% have invested in three or more offers. 30 people have invested in 10 or more offers (which research from the Kaufman Foundation shows is the base level of diversification needed to approach the underlying asset class returns for angel and venture capital investing). The most active investor on Snowball Effect has now invested in 27 offers.

Ongoing services
Our ancillary services have continued to grow with 14 companies now tracking their legal share ownership records in the Snowball Effect share registry. These companies represent 2,059 shareholding records. We also now have 163 director profiles from investors that are available as independent directors for companies that raise capital through Snowball Effect.

For more information from Snowball click here.

 

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Some terrific insights in to what it takes to create value and scale a venture in the Goodnest story

As Madonna so famously sung, we are living in a material world. If she were to update that song, she might tweak it slightly and mention the fact that we are also living in a gig economy. And Goodnest, a platform that matches up jobs that need doing with suppliers willing to do them, is harnessing that shift and attempting to make it even easier for both sides of the equation with a range of new features, a launch into new regions and a new capital raise to fund more growth.

Goodnest was one of the first domestic jobs marketplaces to pop up in this country, launching around four and a half years ago. And things have changed considerably since then, says co-founder James MacAvoy, who, along with his brother, also founded the DVD rental company Fatso that was bought by Sky.

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Angel backed Flick Energy on the next leg of it’s growth journey

New Zealand’s largest petrol company is entering the retail electricity market, spending $46 million for a controlling stake in Flick Electric.

Z Energy, which also supplies the Caltex branded stations across New Zealand, said it was acquiring a 70.1 per cent stake in Flick, which offers access for household customers to wholesale electricity prices.

Mike Bennetts, Z’s chief executive, said the purchase was “another step towards the long-term sustainability of Z, and the role we play in a lower carbon transport future”.

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Manawatu Agtech Start-Up Koru Diagnostics Raises $900k Seed Investment

A Palmerston North-based start-up company, Koru Diagnostics, has had impressive success with its first funding round.

Koru, which is developing cost-effective laboratory and rapid farmside tests, was substantially oversubscribed when it closed its seed funding round recently with close to a million dollars.

CEO, Rhys McKinlay, is very happy with the outcome. “We raised over $900k, mostly from angel investors, which will give us a commercialisation runway through until late 2019. These funds will be directed towards product development and commercial scale-up, protecting our IP and securing new commercial partnerships,” he says.

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Aquafortus wins global award

New Zealand’s Aquafortus Technologies has won the TechXchange Rising Star award for best new technology at Singapore’s International Water Week, this closes out a successful six weeks for the start up, which included an oversubscribed funding round and breaking ground on its first pilot plant in the U.S.

Aquafortus was invited to exhibit under Singapore’s National Water Agency, the Public Utilities Board at Singapore International Water Week. Singapore International Water Week is a global event that brings together world leaders in the wastewater industry, with more than 21,000 participants from 125 different regions.

The tradeshow was a great success for Aquafortus – generating more than a dozen sales leads across eight countries. It also saw new sector applications for Aquafortus’ Zero Liquid Discharge (ZLD) technology, with significant interest from major players in the semiconductor and textile industries, says Daryl Briggs, CEO of Aquafortus.

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The number of deals is shrinking but venture capital still hit a record in Australia

Venture capital in Australia hit a record $US630 million ($AU849 million) in the 2017-18 financial year, up 12% on the previous 12 months, despite a drop in the number of deals, according to Venture Pulse Q2 2018, a quarterly report by KPMG.

Over the three months to June, $US209.09 million of startup investment was recorded in Australia, up from the $US169.8 million the previous quarter.

However, the number of deals was 27, down from 31, continuing a trend for bigger raises to more mature startups.

“Venture financing continues to rise in Australia, keeping pace with worldwide trends,” says Amanda Price, Head of KPMG Australia High Growth Ventures.

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Into the dragon’s den with New Zealand’s million-dollar investments

Hundreds of New Zealand’s wealthiest investors gathered for the 2018 Flux Demo Day last week for a night of wining, dining, and million-dollar business investments. Jihee Junn went along to watch this year’s plucky startups pitch it out.

“The first rule of investing is: don’t leave the table when the food’s being served!” a jolly looking man at my table exclaimed. We were halfway through the night’s events when platters of braised beef, roast potatoes and Akaroa salmon were brought out to the room’s 400 or so investors. As we dug into our family-style meals, passing along giant plates of food from left to right, I asked some of my fellow diners – all older, wealthier, and a lot more male than me – for their thoughts on the startups that had pitched so far. On the whole, their responses were akin to a placid shrug.

“They were okay,” said one man, who told me his day job was working at a private investment firm. Those sitting next to him nodded in agreement. “I’m not really here to invest tonight, but if I was, there probably hasn’t been anything yet to make me want to get out my wallet.”

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Comment: Five steps to stronger capital markets

If the New Zealand economy were a human body, then we can think of capital as the oxygen required to sustain life.

In a functioning capital market, those seeking capital are brought together with those who wish to deploy it. This lowers the cost of equity and debt, boosts the growth of funding and sparks wealth creation.

Is this economic oxygen flowing as it should? Most New Zealand companies listed on the stock exchange (NZX) have unrestricted access to capital, enjoy diverse and internationally-based registers, and are trading at fair to elevated multiples.

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Ten Companies selected for Zino New Kiwis Startup Challenge

Debra Hall, an experienced angel investor and Chairman of Zino Innovation Hub, which runs the Challenge, says the Zino team was delighted at the level of interest shown, with 42 companies, and entrepreneurs from 16 countries, entering the competition.

“As investors in start-up companies, we regularly see talent being wasted because new migrants simply don’t have the connections, the access to capital and sometimes even the language to navigate the early stage of growing a business. Zino is committed to changing this, to create new value for New Zealand” said Hall.

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Lead Partners

NZTE NZVIF PWC

Expert Partner

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AANZ Summit Sponsors

Callaghan Innovation “UniServices” Kiwinet “Spark”