MEDIA RELEASE: AANZ supports Government Changes to Startup Investment

Angel Association NZ welcomes the changes the Government has announced today to the Seed Co-Investment Fund mandate outlined in SCIF 2.0.

Early stage investment has established itself as fundamental to New Zealand’s future economic and social wellbeing. It is a key contributor to the growth of New Zealand’s innovation ecosystem.

“Recognizing that building momentum is the first step in generating value, the changes to the New Zealand Investment Fund’s seed co-investment reflect the maturing of the early stage investment industry in New Zealand,” said Angel Association Chair, Marcel van den Assum.

“As an industry we are moving from prioritizing the number of deals we do, to prioritizing the value of the ventures we have invested in. We are pleased to see the investment cap lifted from $750,000 to $1.5m; doubling down on companies that are performing improves the odds of a rewarding return.”

Mr van den Assum also added that it was good to see NZVIF sending a clear message about the importance of well executed due diligence and active investor engagement.

“Quality due diligence improves the odds of success,” he said noting that it was also critical that ‘in-flight due diligence’ was regularly carried out to ensure the funds are being deployed effectively and strategically with a view to the return on that investment.

“As angel investors we have limited capital and time. We must be more diligent in our assessment both of a venture’s ability to scale and in assessing which companies we will retain in our portfolios,” he noted.

Angel Association New Zealand also welcomed the announcement as an indication of the Government’s ongoing commitment to the early stage ecosystem.

“Creating a self-sustaining, innovation ecosystem is a 20-30 year exercise and it’s pleasing to see the Government continue to support the early stage kiwi companies who are part it,” he concluded.

Ends

For more information, please contact:

Suse Reynolds, AANZ executive director
mob: 021 490 974 or email: [email protected]

Marcel van den Assum, AANZ chair and 2015 Arch Angel
mob: 021 963 459 or email: [email protected]

The Angel Association of New Zealand (AANZ)

The Angel Association is an organisation that aims to increase the quantity, quality and success of angel investments in New Zealand and in doing so create a greater pool of capital for innovative start-up companies. It was established in 2008 to bring together New Zealand angels and early-stage funds. AANZ currently has 27 members representing over 600 individual angels associated with New Zealand’s key angel networks and funds. Recent NZ Venture Investment Fund data revealed angels have invested more than $NZ437m in over 928 deals and 296 companies in the last 10 years. For more, please visit: www.angelassociation.co.nz

 

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Minister wants NZVIF’s Seed fund to deliver better returns

Economic Development Minister Simon Bridges wants the New Zealand Venture Investment Fund to deliver bigger returns under a new investment framework for the Seed Co-investment Fund that will let the early-stage investor take a more active approach.

Among the changes, the government has raised the investment cap for the $52 million NZVIF-managed Seed Co-investment Fund to $1.5 million, ditched the $250,000 funding limit, which Bridges in a statement said will generate stronger commercial returns and better support new start-up companies. A cap on how much can be invested alongside each angel network has been dropped in favour of a $1 million notional commitment, and NZVIF will also be allowed to co-invest with qualified investors outside the traditional angel networks provided it will support promising companies that are trying to commercialise a product or service.

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