Steve Blank – Angels and the Lean Startup #ACAAngelSummit15

Angels Connect NZ series – Bill Murphy from Enterprise Angels reports from ACA Conference 2015

A major highlight of the American Capital Associations annual conference was Steve Blank’s presentation of his customer development methodology – a process which has had an impressive impact on the teaching of enterprise creation in the last decade.

Steve, an academician, serial entrepreneur and investor with over thirty years experience in the technology industry who has founded or worked within eight startup companies, (four of which have gone public), is recognised for being one of three founders of the Lean Startup movement.

His contribution was recognising that commercialisation is a process of testing a series of hypothesis. He currently shares his theories at Haas School of Business, University of California Berkeley, Columbia University and the California Institute of Technology (Caltech). His methods are now being taught in more than 200 universities worldwide, and are recommended by the National Science Foundation and National Institutes of Health in connection with federal grants.

Prior to the lean startup movement and wide spread use of Steve’s customer development methodology investors assumed because they funded a company the entrepreneur would follow a set plan and the board simply monitored it. Investors were treating startups like they were big companies – work out a business plan and then simply implement it.

Great tools were built for execution against plans in large corporations and then used in early-stage ventures and it was assumed this was enough. People who didn’t execute were fired.

Steve proposed that while large companies execute known or proven business models, startups don’t. What angels and other early-stage investors thought they were funding – execution – was actually the search for a scaleable business model that created true value. Instead of assuming entrepreneurs were ‘doing it wrong’ the question that should have been asked was ‘are the critical assumptions about the business plan wrong’?

He has gone on to show that a large percentage of the time entrepreneurs are just guessing about execution. There are no models for early stage venture execution – and no-one is executing in that first year. They are in fact just burning cash conducting a search for that business model – performing a series of experiments to test a problem, solution, a product and a market.

He then went on to create a much-needed methodology to do this work in a robust and repeatable way.

The customer development methodology is now well documented. A good place to start learning more about it is at www.steveblank.com or on his free Udacity Lean Startup course.

Here are the key points Steve shared with angel investors at ACA:

  • Customer development is a process – founders need to get out of building and turn hypotheses into fact by testing the problem exists, the solution is valuable, the product will work and the market wants it.
  • Only then should they build a minimum viable product.
  • Founders need to do the work themselves so that they hear first hand that ‘this or that’ is a bad idea or ‘I wouldn’t pay for it’, read non-verbal signals and pick up on leads to alternatives that might prove to be the solution, ‘Oh we don’t want that – but if you could invent X we would…’
  • Talking to a minimum of 10 to 15 customers a week is the role of everyone working on the startup, with a goal of talking to 100 to 150 potential customers being the benchmark. This number is shown to produce the best results.
  • Then the founder can report back, ‘here’s what I thought, here’s what I learned, here’s what I’m going to do’.

At the conference Steve also pointed out a great thing about this process is tech founders already understand it. The process of defining hypothesis and testing it is used in their work to create and test software and hardware. Striving for evidence based commercialisation is similar to the process engineers go through to work towards deploying programmes and technologies that work.

Its a proven process for minimising time, money and resources.

So, what should angels learn and do that’s different in light of the lean startup movement and in particular customer development methodology?

  • Recognise that often all the entrepreneur has in reality is a hypotheses – ask for evidence or at least what the plan is to collect the evidence.
  • Understand that a startup is a temporary organisation designed to search for repeatable and scaleable executable business model – it is not a business yet.
  • Know the goal is not to stay a startup, but rather to build something which has real value to a set of customers – a sustainable enterprise – and if it scales too you are going to increase the speed of growth and hopefully the size of your returns.
  • Don’t fund people to execute on an idea, that shouldn’t be done on angel money. Before investing check what evidence the entrepreneur has collected that who they say are customers, really are the customers of the product or service they propose. Ask who they have talked to (and how many) and how they have tested their hypotheses. Rather than angels finding out by funding entrepreneurs ideas and blowing $500k, get the founder to go out and do this validation work themselves. Take the time.
  • Then insist you get access to all those conversations and get the founders perspective on the evolution of the idea.
  • Work with founders who are passionate about doing the quantitive and qualitative validation of facts themselves, using a marketing research company to validate the market is not as effective. It is critical is that the people with skin in the game validate whether anything a marketing company tells you is true.
  • Get out of the building yourselves as angels too, make validation your work too – the purpose being to inform the founder’s vision.
  • Your job is not to fund someone to just do focus groups which come up with superficial data such as ’47 say one thing 3 say another’ the skill you’re investing in may be a founder’s ability to pick up on the feedback from the 3 and testing the opportunity to build a business model around them. (47 say sell it for $9.99 – 3 say its an enterprise play and we’ll pay $200k).
  • Once you have a marketing plan aim to test it yourself and see what you learn that’s different from the entrepreneur’s plan.
  • Celebrate the fact that the startup is a search for that executable business model rather than focus on the original business plan and its implementation. Be glad when you and the entrepreneurs learned these new important things instead of beating up the founder for not delivering on a plan.
  • Do the customer validation test yourselves. When you hear ‘I want to order now’, say ‘OK give me $20 I’ll hold it and give you the product when its done’.
  • Invest with the full understanding the initial goal of a startup is to maximise learning not revenue. Returns come from real value-creating scaleable, sustainable business models that are born from that learning.

Bill Murphy

For more highlights from attendees who attended the conference clik.vc/Angels_connectNZ

To meet and hear from international angels and leaders in New Zealand’s angel investment community secure your seat at one the southern hemisphere’s largest international exclusive investor events Asian Business Angels Forum, being held in Queenstown, New Zealand, October 14-15 2015.

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#ABAF15NZ Speaker – Ian Sobieski

Meet the speakers #ABAF15NZ – Ian Sobieski

The Asian Business Angels Forum 2015 takes place in Queenstown, New Zealand and will run 14-16 October. The event has attracted an impressive line up of speakers from all over the world.

The AANZ is particularly proud to have secured Ian Sobieski as a key presenter. Ian leads the Band of Angels, one of the United States most active and successful angel groups.

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The Band of Angels is an impressive group of high-net worth individuals who are all former officers or founders of the kinds of high tech companies that have made Silicon Valley famous. They have invested approximately $231M into 270 startup companies helping to create more than 3,000 jobs. More than 55 of these companies have had successful exits and 10 have IPO’ed.

Growing up in Virginia close to a significant US naval base, Ian was inspired to look into how to make submarines quieter. This led to him being a finalist in the 1987 Westinghouse Science Talent Search.

Ian held senior roles at Evite.com and engineering positions at medical device company Enact Health Management and Kaman Aerospace. He earned an aerospace engineering PhD from Stanford University and a BA in Philosophy from Virginia Tech – an interesting path which took him from submarine acoustics to financial modeling as a venture capitalist.

Ian’s portfolio includes over a hundred early stage investments and he has served on over twenty boards. Seven of his investments have successfully exited via ‘M&A’ including SeaDragon Software, Quorum Systems, Nellix, Novus Packaging, and Ordinate. Two of his investments have been listed on Nasdaq: Genitope and PortalPlayer.

As a founding partner of three seed venture funds, Ian has raised $US65M and a further $US120M as a partner in an early stage venture fund. The Band of Angel’s Acorn Fund backs entrepreneurs with a strategy to build profitable companies or exit on the sole investment of the fund.

Highly active in the early-stage ecosystem in the US, Ian is a founding board member of the Angel Capital Association and is a member of the Young Venture Capitalists Association, as well the American Institute of Aeronautics and Astronautics.

He is author of a dozen technical publications, a former lecturer at the Center for Entrepreneurship and Technology at the University of California at Berkeley, and is a frequent speaker, lecturer, and commentator in Silicon Valley.

In this video from a series on the popular investment platform ‘Gust’ he talks about the angel experience and how angel investment offers entrepreneurs the opportunity to benefit not only from the capital, but also the intellectual investment of angel investors.

Register your place at Asian Business Angels Forum, Queenstown, New Zealand, October 14-15 2015, one the southern hemisphere’s largest international angel investor events, to meet Ian Sobieski in person. Seats are limited, act now. ABAF2015, NZ

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#ABAF15NZ Speaker – Allan May

Meet the speakers #ABAF15NZ – Allan May

The 2015 Asian Business Angel Forum is our country’s big opportunity to meet and build connections with some of the world’s most successful and insightful investors from around the world.

AANZ is pleased to welcome Allan May – Founder, Life Science Angels and General Partner, Emergent Medical Partners as one of its international line-up of thought-leaders.

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As a founder of Life Science Angels (LSA), focused solely on medical device and biotech startups, Allan has curated a group comprised of high net worth individuals who are veterans from the medical device or biotech fields in the US.

The group have, since 2005, invested over $35M in 32 early stage companies who have gained over $700M in follow-on funding. The LSA portfolio also boasts five favourable exits.

Allan’s experience spans founder, CEO, board member and Chairman roles on a number of early stage companies in life sciences – including Intella Interventional Systems, MAST Immunosystems, ImmuneTech, Athenagen (Comentis), Nanostim, nSpine, and BioMimedica. In 2007 Allan joined renowned inventor, entrepreneur and cardiac surgeon, Dr. Thomas Fogarty, in co-founding Emergent Medical Partners. EMP is a boutique venture fund focused on early stage medical device company creation and investing. It has made 25 investments to date with 4 successful exits, including eValve and Ardian.

In 2010, Allan was elected Chairman of the Board of the Kauffman Foundation’s Angel Capital Education Foundation, now known as the Angel Resource Institute. ARI is devoted to the promotion and study of angel investing.

A strong advocate for developing angel investing as a complex ecosystem of peer-to-peer support and mentorship and also the formalization of angel investment engines, Allan has been outspoken on the benefits early-stage investing to the growth of ecosystems. For instance in a 2011 piece for The Atlantic he goes so far as to say angels were key to ‘saving Silicon Valley’; operating as they do on the clear understanding “capitalism still works, and the higher the risk the higher the return”.

Allan began his academic career at Case Western Reserve University where he received his Juris Doctorate. He earned a Bachelor of Arts degree in 1969 from Kent State University and is a graduate of the Stanford Executive Program for Small Business. Allan now frequents conferences and government programs as a lecturer on trends and developments affecting investing in life science. He has co-chaired Singularity University’s Innovation and Entrepreneurship Track at its FutureMed Program and is a member of the editorial board of Elsevier Windhover’s In Vivo magazine.

Allan brings to New Zealand insights from his extensive background of involvement in negotiating mergers, acquisitions, strategic alliances and successfully completing transactions with both public and private companies.

Meet Allan along with New Zealand’s angel investment community and other thought leaders from over a dozen countries by securing your seat now at one the southern hemisphere’s largest international exclusive investor events Asian Business Angels Forum, Queenstown, New Zealand.

 ABAF2015, NZ

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#ABAF15NZ Speakers – Jayesh Parekh

Meet the speakers #ABAF15NZ – Jayesh Parekh

Queenstown, New Zealand, is gearing up for 2015’s Asian Business Angel Forum. The event runs from 14-16 October 2015 with an impressive line-up of business angels from all over the world.

Among the investment experts coming to New Zealand to share their knowledge and networks is managing partner of Jungle Ventures, Jayesh Parekh.

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Mr Parekh has accumulated an extensive portfolio of technology, media and social impact investments with over ten exit or acquisition events among them.

He is also well placed to provide attendees of #ABAF15NZ with an authoritative view on funds and the benefit of angel networks, incubators and accelerators as a partner in a wide range of early-stage business growth and investment vehicles including Jungle Ventures, 500 Startups and Mumbai Angels.

Jayesh is a Singapore citizen and lives there with his family where he is actively involved in the ecosystem. He is Chief Mentor at the Hub Singapore, an Entrepreneur-in-Residence at INSEAD, an Executive Advisor to NUS (National University of Singapore) Enterprise and a TiE (Tech In Asia) Charter Member. As a judge at TiE’s Startup arena in Jakarta in 2014, Tech in Asia’s biggest Startup Asia to date with 2,202 participants, Jayesh was on the judging panel coaching founders to clearly articulate their monetization strategies.

Drawing on his background as an engineer with a Bachelor’s degree in Electrical Engineering from MS University in Baroda, India, a Master’s degree in Electrical Engineering from the University of Texas at Austin, USA and over 12 years at IBM based in Houston and Singapore, he supplies valuable guidance around product believing “best of class product is extremely important and that means the user experience fits across all regions.”

Jayesh also works with existing businesses to help them apply a more entrepreneurial mindset and approach to their enterprises. He delivers in-company presentations and often facilitates deep discussions with sales and marketing and business development teams to help them embrace corporate entrepreneurship as a way to identify new business opportunities.

In his long list of achievements Jayesh counts being a co-founder of Sony Entertainment Television, a major network launched in collaboration with Sony Pictures Entertainment and his board membership of One Animation, Shemaroo, Milaap, and investment in Asvathaa (gaming & animation), Game Ventures (online gaming) and eBus (TV commercial digital distribution).

He is also a passionate advocate and investor in ventures which give back to the community with roles on the Boards of social enterprise focused ventures such as the Investment Committee of Aavishkaar India, which invests in enterprises active in the social infrastructure sector in rural and underserved India. He was on the board of SONG, a fund owned by George Soros which invests in SMEs in India that meet social objectives. He served on the Board of United Way International for six years and is a founder of ProPoor, a non-profit portal for Non-Governmental Organizations in South Asia, and now a service of CharityFocus.

You can follow Jayesh on Twitter and meet and hear from him in person, along with a host of angels from New Zealand’s angel investment community and the world at one the southern hemisphere’s largest angel investor events Asian Business Angels Forum, Queenstown, October 14-15. Seats are now very limited. Be quick to register yours. ABAF2015, NZ

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Crowdfunding – Today & Tomorrow #ACAAngelSummit15

Angels Connect NZ series – Chris Twiss from NZVIF reports from ACA Conference 2015

There was a palpable tension in the room between equity crowdfunding operators and traditional Angel groups/operators for Track 1 at the ACA Conference.

Setting the stage Bill Payne outlined how crowdfunding has been reported in the media as everything from ‘the end of the road for Angels’ to being ‘doomed to failure’ itself – which explains the tension.

For some more concrete perspective Bill began his presentation by laying out some facts and figures around current crowdfunding activity in the World, US and UK/Europe for all forms of crowdfunding; Donation based; Rewards based; Lending based; Real Estate based (Equity and Debt); and finally Equity Crowdfunding (EC) which can either be from accredited and/or unaccredited (i.e. the general public) investors.

Quoting figures from Tabb Group;
– total crowdfunding worldwide in 2014 ran at about US$10bn.
– the bulk (60%) came from US, 30% from Europe followed by Oceania at 3%
– by far the biggest category stateside in 2014 was lending based crowdfunding (50% of the US total of $8.0bn or so)
– a mere 5% of the total investment was Equity Crowdfunding, which at @$0.3bn was only 2% of the size of the US Angel investment market
– In the UK, where equity crowd funding to the public is permitted (it still isn’t in the US) equity crowd funding is a relatively small proportion of the total amount of early stage funding activity. Bill suggested, based on this data, that it is therefore not obviously “taking off” – at least not yet.

Having delivered the numbers Bill gave up the stage to Matthew LeMerie an ex McKinsey analyst now working with the Keiritsu Forum who outlined some scenario planning work that he had recently done on the likely near future of EC.

The overall outcome the scenario planning identified two critical uncertainties for EC.

First, the regulatory environment – and within that the question of whether it will become more or less supportive in the future; and second, the failure rate in EC (i.e. numbers of companies funded though EC that will fail).

Matthew’s personal view was that the regulatory environment will get less supportive for EC overtime – largely because regulators will find that they have been too “lite” with the current regulatory settings.  The antcipated outcome is this will lead to the significant consolidation of EC operators and the emergence of a small number of big players as the hurdles end up becoming too great for small and even mid-sized operators to cope with.

Speaking to the second point the predicted uncomfortably high rates of “failure” will manifest because the key things that need to be done to mitigate that risk when doing this type of investment (i.e. appropriate levels of DD, strong terms setting  – including appropriate valuations, and post investment monitoring etc) will not be done well enough by the majority of EC platforms.

There will be winners and losers. The winners will be those able to demonstrate that they have robust risk mitigating processes in place and, critically, be totally transparent about their failure rates.

Mathew’s analysis was crowdfunding is still a fairly/very modest part of the early-stage funding landscape, and the EC market overall is in borderline wild-west territory in terms of current levels of integrity of process and overall risk mitigation for investors.

Those views were explored further by the third presenter from Seedrs (UK based EC platform) CEO Jeff Lynn. In the ensuing Q&A he passionately rebuked much of what had been said before.

In short, Jeff’s view was in general the future impact of EC was totally underestimated – and disruptive to the current Angel investment models being practiced around the world. He believes that EC has the potential to deliver better investment returns.

Why? The answer was not clear, maybe because having 300 extra people to help your company out leads to greater investment outcomes – right?

And so the debate continued… the crowd shuffled out of the room, ready for the next instalment of it, somewhere nearby, a few sessions later.

 Chris Twiss

 

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#ABAF15NZ Speakers – David Chen

Meet the speakers #ABAF15NZ – David Chen

The 2015 Asian Business Angel Forum takes place in Queenstown, New Zealand, 14 – 16 October 2015.

Hosted by the Angel Association of New Zealand, the 2015 Forum brings together leading investors from around the world to share their knowledge and join together in celebrating this small country’s big contribution to early stage investment.

The AANZ is pleased to be able to bring David Chen – Co-founder, AngelVest to ABAF to share his insights and experience at ABAF.

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Mr. David Chen is a seasoned business leader and entrepreneur with over 20 years of global experience focusing on investments, operations, and business development in China and the United States. He has led and participated in M&A transactions valued at over US $7 billion and has deep investment experience in China and the US.

A co-founder of AngelVest, an investment interest group helping individual angel investors identify and invest in compelling early stage companies in China, he has grown the group to be one of the largest angel groups in China. With over 80 members in Beijing, Shanghai, and Hong Kong they have funded over 35 companies.

Entrepreneurs typically seek to raise from $US100-$500K from AngelVest and enjoy the benefits of continued interaction and mentorship by its strong group of angel investors. They provide hands-on execution support to help companies achieve their strategic and operating goals.

Unlike the United States and other developed countries, there are few, if any institutionalised angel groups in China today.  AngelVest is the leading the industry in China with presences mainly in Shanghai, Beijing, Hong Kong and Singapore.

Increasingly, AngelVest is actively pursuing middle-market cross-border investment opportunities between China and Europe/USA while capturing the growth opportunities in China.

Mr. Chen is originally from New York and has been living in Shanghai for the last eight years. He started as an Engineer with a BS in Electrical Engineering from the University of Rochester and MBA from Harvard Business School, as well as studying Chinese at Peking University.

He came to Angel investing through his experience as a founder and manager of technology start-ups (as lead on strategy, operations, finance), his work with large institutions (including Salomon Brothers, Advanced Micro Devices, Honda Motor) and specialty boutique investment banks, where he helped a number of clients pursue and complete cross-border M&A (particularly China inbound) and financing transactions.

Mr Chen is a highly sort after thought-leader, particularly on the subject of cross-border investments. He has presented at the APEC Accelerator leadership summit, is a member of the Harvard Business School Business Angels alumni dedicating time and commitment to providing investor expertise as a judge in the HBS New Ventures Competition for the “best investment” category.

You can follow Mr Chen’s activities on twitter @AngelVestGroup

To meet and hear from Mr Chen in person, along with a host of angels from New Zealand’s angel investment community and the world make your New Zealand connection and secure your seat now at one the southern hemisphere’s largest international exclusive investor events Asian Business Angels Forum, Queenstown, New Zealand, October 14-15 2015.

 ABAF2015, NZ

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#ABAF15NZ Speakers – Jonathan Medved

Meet the speakers #ABAF15NZ – Jonathan Medved

A key feature of the 2015 Asian Business Angel Forum is its international focus. The forum, brought to New Zealand by the AANZ, runs from 14-16 October and has attracted leading early-stage investors from over a dozen countries.

Among a stellar group of thought-leaders the AANZ is pleased to welcome Jonathan Medved,  founder of OurCrowd, an equity crowd-funding platform based in Jerusalem, Israel. He will share his thoughts on ‘thinking, acting and investing globally’ and how to build the culture needed for startups to flourish.

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Jon grew up in San Diego, went to Berkeley University, and first visited Israel when he was 24 . Since then he has been part of the energy making Israel the 3rd largest source of startups after north America and China.

Israel has attracted over 300 multinational R&D centres which provide a ‘built-in exit mechanism’ for Israeli startups to be acquired by American technology companies. Israel has been described in Forbes as the world’s outsourced R&D lab for big companies.

Named as one of the top 10 most influential Americans who have impacted Israel (NY Times Supplement “Israel at 60”) and “one of Israel’s leading high tech venture capitalists” (Washington Post) Jon, through his most recent venture, OurCrowd, has funnelled $120 million in investments into 67 startups since 2013.

An investor himself, serial entrepreneur and experienced director, Jon has been part of the founding teams in several successful Israeli startups which now have valuations in excess of $100 Million. He currently has over 30 companies in his personal angel investor portfolio.

In a report from the Jewish Journal taken from a presentation at Cross Campus, a shared work space in Santa Monica Jon describes OurCrowd as an “equity-based crowdfunding platform that allows accredited investors to put as little as $10,000 into a select number of approved and vetted Israeli startups, all of which need cash to grow and stay afloat, until business operations kick into full gear”. Through OurCrowd he says investors are “able to take the best of venture capital — the professionalism, the diligence, the protection you get — and combine it with the fun, and discretion, and the freedom, and the low entry price of being an ‘angel’ [who invests after falling in love with a company]”.

Jon is a sort after TV commentator on CNN, CNBC, Bloomberg TV and speaks regularly to groups both in Israel and abroad. He has briefed scores of journalists, business leaders and public officials – including New Zealanders – on Israel’s tech miracle, travelling from his home in Jerusalem where he lives with his wife Jane, his four children and three grandchildren to all corners of the globe to do so.

In this video from Kauffman foundation he talks about the special elements of the Israeli ecosystem and suggests looking past macro-economics and support the heart of startup success – the culture that needs to exist to support early-stage growth. A culture that sustains, encourages and allows people to take the entrepreneurial leap and create new value and new companies. Included in this culture, he says, is the requirement for risk tolerance, the importance of access and the intent of all parts of a country to support and structure the ecosystem in which angels and venture capitalists exist.

Follow Jonathan on Twitter and meet him in person, along with a host of angels from New Zealand’s angel investment community and the world by securing your seat now at one the southern hemisphere’s largest exclusive angel investor events Asian Business Angels Forum, Queenstown, New Zealand, October 14-15.

 ABAF2015, NZ

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#ABAF15NZ Summit Speakers – Nelson Gray

Meet the speakers #ABAF15NZ – Nelson Gray

The 2015 Asian Business Angel Forum, proudly bought to New Zealand by the AANZ, and runs from 14 to 16 October 2015. 

Among the international guest speakers at ABAF is Nelson Gray winner of 2015’s prestigious Queen’s Award for Enterprise Promotion and an internationally recognised thought-leader in early-stage investment.

Nelson will share his insights on angel investment models, international connectivity and portfolio companies gleaned from over 20 years of experience as an angel investor.

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Following the sale of his own successful business in 1995 Nelson Gray became an educator, angel investor, mentor, non-executive director, and fund manager.

A key player in the development of the business angel community in Scotland, Nelson was central to the widespread international recognition and adoption of the LINC model (Local Investment Networking Company). He is now a non-executive director of the Scottish Angel Capital Association established in 1993 to promote Business Angel Investing – LINC Scotland.

A passionate promoter of angel investing’s important role in the development of the economic success, in BQ, one of the United Kingdoms key online publications Nelson says “people like myself become business angels because we want to invest our capital and knowledge into local businesses with the potential to make a significant economic difference.  Seventeen years ago my wife and I invested in a Borders company which has grown into one of the largest employers in the area.

“I feel that we’ve put something back into Scotland, particularly for young people, it’s not just a financial payback but a social one.  I am a ‘hands-on’ investor and like to help businesses as well as providing money and if we can have fun along the way, even better.”

Using his qualifications as a UK Financial Services Authority fund manager, Nelson has managed two early stage investment funds responsible for funding over 50 Scottish SMEs in addition to 25 companies personally.

Beyond his tireless work in Scotland Nelson is also recognised internationally. He has worked with development and government agencies around the world to develop and implement policies which facilitate growth and effective operation of local investment communities. This work has contributed to his achievements helping build angel groups in Latvia, Jordan, Russia and Jamaica.

Global engagements have included United Nations Economic Commission for Europe (UNECE), The Inter America Development Bank – Washington, The International Science and Technology Centre – Moscow, the Estonian Development Fund – Arengufond, the Latvian Enterprise Department, Intertrade Ireland and Enterprise Ireland, El Hassan Science City– Amman, Jordan, the National Agency for Technological Development – Kazakhstan, advice on the establishment of Angel tax incentives in Finland and the expansion of Angel groups and syndication in Estonia. In these special project director roles he acts as a mentor to new investment groups and develops tools and procedures to further best practice in Angel investing.

Nelson was the European Business Angel Network ‘Business Angel of the Year’ in 2008, and is now Vice-President. He is a director of ESEP Ltd, which administers European Union Structural Funds Programmes on behalf of the Scottish Government.

He has provided advice on the establishment and structuring of a number of innovative early stage investment funds (both in Scotland and overseas) is a member of the investment committee for the £50m UK Angel CoFund, a non-executive director for the Genomia Seedcorn Investment Fund which targets the research outputs of the animal and life sciences sector. Formally the locum Fund Manager for Clyde Blowers Capital IM LLP, a £250 million venture fund. As a member of the Advisory Board of SU2P, a collaboration of 6 universities (Strathclyde, St Andrews, Heriot-Watt, Glasgow, Stanford and the California Institute of Technology), he has supported the increase in academic and industry interaction between the USA and the UK.

He has been chairman of Firth Ventures for over 15 years and is also a member of the Investment Advisory Board to the UK Government’s US$160 million Co-Investment Fund and a member of the advisory panel to the Welsh Government for the establishment of a development bank for Wales.

As the former locum Fund Manager for Clyde Blowers Capital IM LLP, he managed a US$400 million venture fund; and, from 2001 to 2010, was a board member of Scotland’s Entrepreneurial Exchange, which has some 400 members heading-up companies that employ more than 150,000 people and with a collective turnover of over US$25 billion.

It is no surprise therefore that this year Nelson won the Queen’s Award for Enterprise Promotion for individuals who have played an important role in promoting enterprise skills and supporting entrepreneurs.

Follow Nelson Gray on Twitter and meet this giant of early-stage investment in person at ABAF in Queenstown this October. By securing your seat at the forum you are joining the southern hemisphere’s largest international exclusive investor event.

Register now, Asian Business Angels Forum, Queenstown, New Zealand, October 14-15 2015.

 ABAF2015, NZ

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#ABAF15NZ Speaker – Bill Payne

Meet the speakers #ABAF15NZ – Bill Payne

A key feature of the 2015 Asian Business Angel Forum is its international focus. The forum, bought to New Zealand by the AANZ, runs 14-16 October and has attracted leading early-stage investors from over a dozen countries.

Among a stellar group of thought-leaders the AANZ is pleased to welcome Bill Payne. A genuine rock star of angel investment. Bill is internationally recognized as one of the most senior and experienced experts in angel investment. He is an engineer, entrepreneur, angel investor and educator.

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For over three decades, Bill has successfully founded and invested in over 50 start-up companies, including Solid State Dielectrics, Inc., an electronic materials company he founded in 1971 and sold to E. I. DuPont in 1982.

Bill has delivered over 120 man-years of service on private company and non-profit boards of directors and has served as an Entrepreneur-in-Residence to;

  • Ewing Marion Kauffman Foundation – 1995-2007
  • McGuire Entrepreneurship Program, University of Arizona 2004
  • BNZ-University of Auckland – 2010
  • i2E – Innovation to Enterprise, Oklahoma City – 2010 to present

He has served on the founding committee of the Angel Capital Association (US), on six university advisory boards and as a founding organizer and member of four angel groups in the US

  • Aztec Venture Network – 1999 San Diego
  • Tech Coast Angels – 2000 San Diego
  • Vegas Valley Angels – 2004 Las Vegas
  • Frontier Angel Fund – 2006 Northwest Montana

In addition to facilitating over 100 workshops and seminars on angel investing in six countries Bill has been recognized by his angel investing peers and honored with the following awards:

  • 2009 Hans Severiens Memorial Award for Outstanding Contributions to Angel Investing
  • 2010 New Zealand Arch Angel Award for his impact on angel investing in New Zealand
  • William H. Payne Active Angel Award – presented annually to the outstanding angel investor in Auckland’s ICE Angels

From 1995 to 2007 in his role with as an Entrepreneur-in-Residence with the Kauffman Foundation (Kansas City), he worked on educational programs for entrepreneurs and their investors, including eVenturing.com and the Power of Angel Investing seminar series. While with Kauffman, he was also actively engaged in the formation and startup of the Angel Capital Education Foundation (now the Angel Resource Institute) and the Angel Capital Association.

For five months in 2010, Bill served as the BNZ University of Auckland Entrepreneur-in-Residence in New Zealand.  During this service, he delivered 20 seminars, 45 public lectures and mentored 75 entrepreneurs.  The ICEHOUSE chief executive Andy Hamilton said, “We were fortunate to have had Bill here working so closely with businesses and angel groups around New Zealand.  His guidance will have a positive effect on the start-up and investment community for a long time.”

Bill graduated with BS and MS degrees in Ceramic Engineering from the University of Illinois, where he has served on the Dean’s Board of Visitors of the College of Engineering.  His eBook, the Definitive Guide to Raising Money from Angels is available on his website at www.billpayne.com. He and his wife Ann are residents of Henderson, Nevada and Whitefish, Montana.

 

 

You can meet Bill in person, along with a host of angels from New Zealand’s angel investment community and the world by securing your seat now at one the southern hemisphere’s largest international exclusive angel investor events Asian Business Angels Forum, Queenstown, New Zealand, October 14-15.

 ABAF2015, NZ

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Small Business: Eyes on the US

In this insightful article, angel-backed Fuel50 talk about the really nitty gritty aspects of entering the US market and have some lovely accolades for angel investment.

Small Business: Eyes on the US – Business – NZ Herald News
In October last year the folks behind Kiwi company Fuel50 won big in Las Vegas – but the source of their winnings wasn’t the roulette or blackjack tables.

Instead the company’s offering was awarded as one of the best new human resources technologies at the HR Technology Conference, which is held annually at the desert resort mecca.

Fuel50 creates career path software, typically aimed at companies with a high concentration of knowledge workers and with 1000 or more employees, and its CEO Anne Fulton says the win opened the door to coverage in the Wall St Journal and other US publications.

It all helps when you’re a tiny Kiwi company targeting major US-based customers in a competitive landscape that includes the likes of technology giants Oracle and SAP.

“In the US there are 11,000 companies in our target market versus 100 in New Zealand and 444 in Australia.

So there’s no question that’s the market we want to be in,” says Fulton.

“We’re trying to build a really big business brand, so our marketing has been critical to us acting like a bigger company. We talk about being David and Goliath; we’re a micro business down here in New Zealand, but we market like we’re a large enterprise.”

Like Fulton, many New Zealand small business owners making inroads into the US cite the scale of opportunity as a reason for their focus on the market, but the sheer size of the US also means small Kiwi companies need to direct their efforts carefully.

“We’re such generalists and in the US you really need to narrow your focus, and even as you keep narrowing it you find you’re still dealing with opportunities far greater than you could ever get here,” says Ben Ridler, CEO of business management software firm Results.com, which has a San Francisco office with around a dozen staff.

Ridler says hiring Americans is helping mould the company’s thinking.

Ben Ridler, CEO of Results.com.

“I think they’re the most advanced society when it comes to sales and marketing. Both our head of US sales and our head of marketing are American, so they’ve knocked the Kiwi thinking out of us a bit. But I think Kiwis have a lot to offer too. We’re very good at delivering a product or service to a client need and we innovate really well, so I think between us it’s a really nice mix.”

Hiring locally has also been important for Spotlight Reporting, a software as a service (SaaS) company that produces business intelligence add-ons to online accounting software platforms Xero and QuickBooks Online.

The firm has one US-based staff member – sales director Leslie Riggs, a Californian – who Spotlight’s CEO Richard Francis says “already has great knowledge of different ecosystems in the US”.

But it’s still crucial for Kiwi company leaders to regularly get on a plane to the US, he says, and that all efforts in the market are adequately resourced.

“The main thing that’s distinguishing the companies who make it in the US and the ones who aren’t is investment,” says Francis. “If you’re going to go there, you’ve got to do it seriously, and for investors, particularly in the SaaS world, you have to have a US market play.”

Q&A: Anne Fulton, Fuel50

Anne Fulton is the CEO of Fuel50 / Career Engagement Group, which creates career path software and has offices in Auckland and New York.

When did Fuel50 first start engaging with the US market?

We took on our first angel investment at the end of December 2013, started looking at establishing our US operation in January 2014 and had appointed and trained staff by April that year. So we’ve been going for about 15 months in the US. We’ve learnt a lot.

Why is the US market such a focus for the company?

The US market for HR tech is the most sophisticated in the world; it’s valued at $14 billion a year and it’s still growing. We work with enterprise clients who have a high concentration of knowledge workers and typically with 1000 or more employees – so banking, finance, health care, higher education, technology companies. In the US there are 11,000 companies in our target market versus 100 in New Zealand and 444 in Australia. So there’s no question that’s the market we want to be in.

The US really leads the way when it comes to thinking around HR technology. The companies are so sophisticated and they use multiple HR technologies to support their people strategies, plus the HR technology landscape up there is super exciting. Our product fits a niche in the market – currently there’s very little dedicated technology to support career pathing – so that’s our opportunity, to become the leading career pathing technology in the US and globally.

What’s the current state of your business in the US, and some of your goals for growth there?

We have a goal to have 100 US clients by the end of next year; we have five now, but that includes some big names and some Fortune 100 companies and 100 best places to work in the US. At the moment everything is trending in the right direction. Last year we doubled our recurring revenue, and we’ve doubled that again in the past six months.

What do you think has helped you get your foot in the door of that market?

We’re trying to build a really big business brand, so our marketing has been critical to us acting like a bigger company. We talk about being David and Goliath; we’re a micro business down here in New Zealand, but we market like we’re a large enterprise. In our competitive landscape we’ve got Oracle and SAP, so we’re playing into that space and we look carefully at their marketing and try to emulate or do better than anything they’re doing, particularly in the career pathing research and thought leadership space.

Underpinning our marketing is a foundation of research. We’re aiming to be thought leaders and providing research and insight into what best practice ‘career enablement’ looks like. We’re regularly invited on to the conference speaking circuit, particularly in the employee engagement industry. We were fortunate enough to also get noticed by picking up the award for being one of the best new technologies at the HR Technology Conference in Las Vegas last year, and that opened us up to coverage in the Wall St Journal and other publications, which all helps credibility.

The other thing is engaging with the HR community in the US, so really having quality conversations and building strong relationships with our prospects. We work really hard on what we call our ‘Fuellie’ culture – to be fast, fun and fantastic as a team – so everyone has fun together but they also have aspirational performance objectives. Our US team have some big goals, but they’re incredibly high performing.

How about things that haven’t worked as well? What have been some of your major learnings so far in the US?

Because we’re about the people proposition we really have to live our business values. What’s been interesting in the US is people are more prepared to come and go quickly, so you’ve got to be really focused on engaging them, keeping them motivated and have a good pipeline of talent.

How have you grown that pipeline?

The same way we’ve found our clients – through contacts, relationships and attending events within the HR industry. Having a strong board has also helped us attract great talent and the angel investment community behind us has been outstanding. We wouldn’t be doing what we’re doing, or have achieved what we’ve been achieving without their backing. Being able to tap into people like the ex-chair of Xero, Sam Knowles – who’s one of our investors – has been incredible.

As first published NZHerald 22 June 2015

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Seeing the light led to law career

A wonderful article on Enterprise Angels member, Murray Denyer who totally personifies what it means to be an angel investor.

MURRAY Denyer’s eureka moment came part way through his double major in commerce and law at Auckland University in the early 1990s.

Supported by a scholarship from a major accounting firm, he had been leaning towards a career as an accountant. Then he stumbled across a Ministry of Foreign Affairs and Trade recruitment presentation.

“I saw the light – it absolutely appealed to me,” said Mr Denyer, a partner with law firm Cooney Lees Morgan, chairman of Tauranga economic agency Priority One, and an active angel investor.

The prospect of an international career tapped into a travel bug developed as a teenager, when he and a mate headed off straight after finishing at Waitakere College for three months’ backpacking around Europe.

“It was a major formative experience that opened my eyes to the world and cemented my interest in languages,” he said.

Mr Denyer, who was born and brought up in West Auckland, where his father was a chemist and his mother a GP, now set his sights on a diplomatic career.

He refocused his degree on international law, graduating with a Bachelor of Commerce and Bachelor of Law, and joined the Ministry of Foreign Affairs and Trade’s 1993 graduate intake as a legal division policy officer.

A major highlight of his diplomatic career came while he was serving on a short-term posting with the New Zealand mission to the United Nations in 1994, when he was on hand to observe Nelson Mandela deliver his first speech as president of South Africa to the General Assembly.

Soon afterwards, he was posted to The Hague as second secretary, looking after New Zealand interests in The Netherlands and Scandinavia. His brief also included international organisations based in The Hague.

Mr Denyer said he was proud to have played a role in working on the New Zealand case brought in the International Court of Justice which eventually forced the French to stop nuclear testing at Mururoa.

A French speaker, he spent a lot of time travelling in southern France. His blue-blooded, Paris-trained, French diplomatic peers found the Francophone Kiwi’s ability to swear like a Marseilles sailor hilarious. “I’m a strong believer in encouraging children to learn languages,” said Mr Denyer.

It was in The Hague that he met his wife Lisa, an Australian-trained lawyer who was travelling in Europe. After a whirlwind romance, she ended her travels and started work at a Dutch bank in nearby Amsterdam.

In 1998, the couple returned to Wellington where he served as a senior legal adviser and worked on international trade law disputes, travelling frequently to the World Trade Organisation in Geneva.

But after almost eight years with MFAT, he decided it was time he entered private practice and joined Minter Ellison Rudd Watts in Wellington as a senior associate. He became a key member of the firm’s state-owned enterprises practice, and also gained broad corporate and commercial experience. In addition, he founded and developed a high-profile international trade law practice, with clients including Fonterra, the Ministry of Foreign Affairs and Trade, the Ministry for Primary Industries and New Zealand Winegrowers.

It was that export experience which brought him to the attention of a headhunter seeking a new general counsel for kiwifruit export marketing company Zespri. Mr Denyer knew the company well, but had never been to Tauranga, so he and his wife decided to check out Mount Maunganui.

“We left on one of those filthy cold Wellington days,” he said. “But when we got out in Tauranga it was 21 degrees and the sun was out.”

His wife, pregnant with their first child, took a walk on the Mount Maunganui beach while he interviewed for the job. By the time he returned, the decision to take the job and raise a family in Tauranga was a foregone conclusion for the couple.

“It’s paradise and we’ve never looked back,” he said.

Mr Denyer spent almost six years with Zespri, his role growing to include global management accountability for legal, government relations and industry regulation, and human resources, in addition to serving as secretary to the Zespri board. He was also deeply involved in the global licensing of kiwifruit varieties.

“It was enormously satisfying and incredibly busy, but towards the end I was doing a ridiculous amount of travel,” he said.

His wife had by then been working for some years with Cooney Lees Morgan, which advises Zespri, and he knew the team there well. In 2009 he came on board the firm as a consultant, and was elected to the partnership in 2010.

Mr Denyer works with the commercial practice group, servicing clients including large corporates like Zespri and Norske Skog, local government, Maori trusts and incorporations, and a wide range of small and medium-sized companies.

He has served as Priority One chairman for the past three years and praises the organisation for bringing the council and local business together to help plan the city’s economic development.

Priority One chief executive Andrew Coker said Mr Denyer had been a strong supporter of the agency’s s goals.

“As chair he’s made a major contribution to the organisation’s direction and it’s success,” said Mr Coker. “Murray’s strongly community-focused, and has been extremely generous with his legal and commercial expertise, as well as what is a precious commodity to him and his family, his time.”

Mr Denyer and fellow partner Paul Tustin are also closely involved in Cooney Lees Morgan’s advisory work for Tauranga’s Enterprise Angels, which invests in start-up companies.

Mr Tustin said his colleague was a very good lawyer who brought a valuable perspective to the firm from his corporate and diplomatic experience.

“Murray’s got a really good handle, at a governance level, on organisations, which has been very helpful as well,” said Mr Tustin.

As first published NZHerald 19 June 2015

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More Cross Border Investment #ACAAngelSummit15

Angels Connect NZ Series, Brent Ogilvie from Pacific Channel reports from the International Exchange Workshop at the ACA Conference 2015

I last attended an ACA conference two years ago. This year there was clearly not only far greater interest in doing cross-border deals, but angel investors making it happen.

Panelists at the ACA’s International Exchange workshop were up beat about the quality and quantity of opportunities globally. Those on the panel included Audrey Jacobs from Our Crowd the equity crowd funders based in Israel, and Jeff Lynn from another equity crowd funding platform, Seedrs, based in London.

All of the panelists discussed their activity and structures openly to encourage more interest and engagement from investors around the world, whether in groups, networks or funds. They agreed that as an industry angels need to focus more on the outputs of their investment – creating high value jobs and exits.

Audrey Jacob’s view is that the current VC model is ‘broken’. She estimated there are only 100 VCs in the world investing in more than 3 deals per annum. Most general partners now only receive their annual 2% fees from funded capital (not on committed capital).

OurCrowd invests its fund alongside its equity crowd funding members who are all accredited business angels. The crowd funding investors participate as ‘limited partners’. Audrey Jacobs explained OurCrowd negotiate the deal terms and participate as a ‘general partner’. OurCrowd put in a minimum of $50k per deal and will contribute up to 10% of the round.

To date OurCrowd have invested $US110m in 64 companies. They are agnostic about the company’s stage, sector or country of origin and are currently reviewing deals from Brazil and Spain. (Editors note: OurCrowd have invested in Varigate, a NZ company, commercialising an irrigation technology).

Audrey Jacobs’ insights set the theme for the session with multiple examples of early stage investors pooling capital, allowing smaller investors in the ecosystem to participate in deals and securing similar returns to larger lead investors.

Backing up this increased interest in cross border deals Jeff Lynn sited a recent survey where 22% of British angels said they would invest outside the UK. In a later session on US angel investor preferences, more than half said they had no geographic preference. This compares to just six years ago when two thirds said they would only invest in deals no more than a two hour drive away.

Another example of international capital pooling came from Swiss based angel group, Go Beyond, which syndicates with angel groups in 7 countries and has the ability to “transfer shares” among the groups.

Go Beyond has invested in US ventures and put money into deals sourced in France, Spain and Switzerland. The group hold monthly virtual meetings to discuss deal flow. The lead angel in each deal takes a “free carry” and is responsible for quarterly reporting to shareholders.

Blake Witkin, the Chairman of Ontario’s Network of Angel Organizations outlined the problem pooling capital solves. He had found some local angel groups were missing out on deals because their investment processes were too slow. Establishing a fund offers a neat solution as it provides a pool of capital with a mandate to invest quickly and secure an option for its angel participants to invest in follow-on rounds.

Dreamfunded.com, formed by a San Francisco angel group, has 3,400 accredited investors who want more deal-flow. This group would also like to hear from angel groups internationally who have deals to syndicate.

The session bodes well for New Zealand’s focus on exporting knowledge and spreading kiwi innovation internationally.

Brent Ogilvie

For more highlights from attendees who attended the conference clik.vc/Angels_connectNZ

To meet and hear from international angels and leaders in New Zealand’s angel investment community secure your seat at one the southern hemisphere’s largest international exclusive investor events Asian Business Angels Forum, being held in Queenstown, New Zealand, October 14-15 2015.ABAF2015, NZ

 

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Equity crowdfunding’s strong start

A strong start for equity crowdfunding platforms reflects a genuine appetite to support inspirational NZ businesses. It’s important that these companies get more than just support in the form of capital but also with value and market growth strategies.

Fifteen young firms have raised a total of $8.7 million through three equity crowdfunding platforms since the low-strings fund-raising mechanism got the green light from regulators last year.  The sum may be small compared to the $55m that well-heeled “angel investors” pumped into high-growth businesses last year and to the $4.7b bigger businesses raised through the NZX stock exchange in 2014.

It looks even tinier when compared with the current value of bank loans to businesses, which stood at $80b in April, according to the Reserve Bank.

But Chapman Tripp corporate lawyer Bradley Kidd says the start is encouraging.

More platforms have been set up than he expected to support equity crowdfunding and there have been some “really good offers”, he says. “I’d say it has gone a bit better than I’d of expected.”

Read more on www.stuff.co.nz

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How to write a good financial forecast for Angel investment

In the first of our Angel insights content series – Dave Allison from Angel HQ shares his knowledge gained from reviewing 100’s of deals on how to write good financial forecast for Angel investment

Financial forecasts are a crucial part of the business plan and can help to attract investment to your startup or product launch, however the balance between reality and ambition is a challenge when building these documents.

Bare in mind that no two angels are alike and what may seem an important point to one may be meaningless to another. Some angels want you to get them excited and others will ask you to tone things down. The best way to present your financial projections to investors is to walk them through different scenarios in order to show potential. But consider pitching what you are most comfortable with.

For every forecast, a list of all your key assumptions is absolutely a requirement as well as the ability to support them with accurate quality information and to explain how they were measured.

Key assumptions are critical to all aspects of the financial forecast and professional support to develop a model can be useful but two words of warning:

  •   Experience is more important than the big name. Ask your expert what they have modelled and who they have done it for.
  •   You can’t hand off responsibility for the forecast – you have to own it and own all the assumptions

Tracking and testing these assumptions on an ongoing basis is the best way to react to them quickly if they don’t show a real chance of success.

It is important to have an intimate knowledge of how your forecast works and what the key levers are. This is a model of your business so what happens if sales or prices slide by a few months (or a few million dollars) is not just important – you HAVE to know.

Your investors will want to know who your customers will be and at what price they will be eager to buy your product.
Bill Payne – The Definitive Guide to Raising Money from Angels

Every angel expects and accepts that the numbers are not correct but you will lose credibility if your assumptions are not defensible. Look for comparisons to other companies. Build your evidence and know your stance. Feel free to highlight the biggest, riskiest assumption but back yourself with what you are doing to manage that risk.

Don’t put all the detail in your pitch. Too many columns just invite people to do maths instead of listening to you. Pull out key figures, key events and timescales to show the impact it will have on your business with reasonable explanations. Have the detail of your model for follow up – PowerPoint and Excel are separate programs for a reason!

ABAF2015, NZ

To meet international angels, leaders in New Zealand’s angel investment community and make your New Zealand connection secure your seat at one the southern hemisphere’s largest international exclusive investor events Asian Business Angels Forum, being held in Queenstown, New Zealand, October 14-15 2015.

Register now. Limited places available.

 

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Supporting CEOs in your Portfolio Companies #ACAAngelSummit

Angels Connect NZ Series – Bill Murphy from Enterprise Angels reports from USA Angel Capital Association Conference 2015

Recognising the crucial role angel investors play in a company’s development after the first round of funds have been committed, the ‘Supporting Portfolio CEOs‘ workshop took a deep dive into leveraging board member skills to guide a company through value accretion to exit.

The first point made was how important it is for angels to acquire the skills and knowledge required to properly manage the important issues following investment. It is also clear that it takes a real commitment to be effective.

Ideally an investor-director should be putting in a couple of days a week, with their primary function being ‘chief encouragement officer’.

As most founders don’t have experience running a business the angel director should be constantly asking questions that support the growth of the founder, the team and the company. Complaining and blaming don’t help.

Key questions to be asked and answered on a regular basis include;

  • What’s the cashflow position?
  • What cash is it going to take to get us to the next fundable round of investment?
  • Have we defined our market tightly and distinctly so that we can “own” that market? and
  • How can I help develop strategy?

Calling and talking to the CEO on a random basis (in addition to regular board meetings) was also suggested. These conversations are far more effective than written communications. Discussing progress ‘on the fly’, one on one, is a really effective means of teasing out issues.

Every investor-director should regularly review material which provides an introduction to governance of an angel backed company. Understanding how the functions of an early-stage board differ from boards of established companies is vital. Attending a course or reading up on this is hugely helpful.

Sitting down with the founder and the team at the outset to make sure expectations about the exit and path to exit are agreed and aligned is highly recommended. This should be done even before the first cheque is written.

The ideal size for an early stage, high growth company is five. Three members will be independent of management. It is paramount that management and the board have complete clarity about expectations regarding reports and reporting – how often, how long, covering what etc. Panelists and attendees at the workshop agreed it’s far better to warn entrepreneurs you are going to be a ‘pain in the ass’ at the outset and made the point that there will be less pain for everyone if regular timely reporting is carried out.

Another useful tip was immediately after investment it’s worth taking time to map out with the entrepreneur and the board the first 6 month’s implementation plan with a laser focus. Many founders are overly opportunistic, running after every opportunity or adopting every customer request for product iteration. This is unlikely to add value to the enterprise.

Other useful suggestions included;

  • Doing a SWOT analysis on a regular basis.
  • Setting annual milestones which are informed by the CEO talking to potential acquirers about what the company needs to look like to be bought.
  • Helping the CEO identify non-dilutive sources of capital.

Finally, the audience was reminded that accessing the angel group at regular angel group meetings where investor-directors and founders can talk about what stage the venture is at, is a really effective way to achieve better results. These meetings serve a dual purpose – they keep members informed so they are likely to be positively disposed to the next funding round and they increasing the chances of success by leveraging the intellectual resources of the entire angel group, pulling contacts and experience.

It was encouraging to hear that many of the activities the AANZ is undertaking reflect international best practice outlined in the workshop. The governance course for new angel directors being developed by the AANZ with some help from New Zealand’s Institute of Directors (email [email protected] for more information) and the increasing number of member meetings (outside regular pitch evenings) all bode well for NZ angels and entrepreneurs. A shared focus, regular reporting and leveraging shared networks are key components of multimillion-dollar exits.

Bill Murphy

For more crowd-sourced intel from #ACAAngelSummit 2015 as it happened clik.vc/nzangelaca15

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For more highlights from attendees who attended the conference clik.vc/Angels_connectNZ

To meet and hear from international angels and leaders in New Zealand’s angel investment community secure your seat at one the southern hemisphere’s largest international exclusive investor events Asian Business Angels Forum, being held in Queenstown, New Zealand, October 14-16 2015.ABAF2015, NZ

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Angel messages from America

Angel Association members from all over New Zealand have been crossing paths in Air New Zealand Koru lounges on their way to the US this week for the annual ACA Summit in San Diego.

An important event on the calendar of kiwi investors, the ACA Summit is an opportunity to tell great New Zealand stories, connect with international angels, funds, VC’s and meet potential market-entry and acquisition partners from all over the world.

New Zealand’s Angel messengers, carrying kiwi success stories overseas include Marcel van den Assum, Chair and Suse Reynolds, Executive Director of AANZ and Michelle Cole from Angel HQ along with; Bill Murphy and James Beale from Enterprise Angels; Rudi Bublitz from Flying Kiwi Angels; Brent Ogilvy from Pacific Channel; Darryl Lundy, David Russel, Robbie Paul, Cecillia Tarrent from IceAngels; Chris Twiss from NZVIF and Karen Chang from NZTE/LAX to name just a few.

Learning and networking as they go, the Kiwi contingents key collective mission is two fold.

First, entice ‘overseas friends of New Zealands angels’ (affectionately known as OFONZ’s) to ABAF in Queenstown from Wednesday 14 October to Friday 16 October to meet their investee’s in person, experience the energy of New Zealand’s angel community and learn about the benefits of doing business with and in New Zealand. 

Second mission, sharing the skinny! To ensure as many of the learning and insights our Angel-team glean are shared with the early-stage community at large we are expecting to receive posts and tweets from many of the team during the conference.

As they listen to keynote serial-entrepreneur and Lean Startup founder Steve Blank tell you how he changed the course of the startup industry through customer development – we’ll get the highlights as they happen and share reflections.

As serial entrepreneur and profilic angel Gil Penchina, the most active syndicator on AngelList talks about his experience and shares his mental models, we’ll get the benefit of their attendance.

Look out for tweets #ACA15NZ. This hash tag will tell a story about angels from NZ at ACA – who they are, what they think, who they think is worth listening to, words of wisdom they hear, insights they gain, things they find out that those back home should know about the US and the rest of the world… and people they’ve met who are coming to the ABAF2015 in NZ!

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ABAF 2015, Queenstown, New Zealand Connection

Discover your New Zealand connection.

Angel investors do business together – we do business together when we invest in deals, when we are looking for follow on funding rounds and when we are looking for in-market opportunities. We do business together when we are looking for acquirers and we do business together when we are celebrating exits. We are a collaborative group of professionals who acknowledge and appreciate each individuals unique experience and expertise.

The Asian Business Angels Forum being held in Queenstown at stunning Mount Soho Winery is in keeping with the nature of our community.

It is the Angel Association of New Zealand’s desire to keep this event an angel-centric, intimate gathering, this terrific venue has limited capacity so we advise that you register quickly to avoid missing out.

This summit will focus on providing delegates with practical insights on how to build and execute successful, capital-acquisition strategies from the first round through to exit.

You will hear from seasoned practitioners about the importance of a capital strategy in angel venture success, about board stewardship and alignment, how to successfully court acquirers internationally and how to manage market disrupting intellectual property for commercial success across the globe.

With delegates coming from across the Asia Pacific, Europe and North America we are going to dig into how to do more cross border deals and work on live examples of deals which have the potential to be exactly this while having the opportunity to enjoy the natural beauty of our chosen location – Queenstown.

The stunning scenery, natural beauty and the vibrancy of the region make Queenstown the perfect destination to relax and enjoy sophistication and world-class facilities.

 

Here’s a list of superb accommodations to make your stay a memorable one:

 

millbrook_imageMillbrook Resort is a luxury resort only a 20 minute drive from Queenstown. The five star accommodation resort includes three restaurants, a bar/cafe, award winning spa, a 27-hole golf course, health and fitness centre with outdoor hot pool, heated swimming pool, mountain bikes and much more. Millbrook is two minutes drive from the nearby historic gold mining village of Arrowtown. The perfect getaway scenario to energize and relax surrounded by mountain air and open space.

 

crowneplazaCrowne Plaza is centrally located and a walking distance to everything you need in Queenstown. The hotel offers fine hospitality and a magnificent scenery. This modern hotel provides luxury at its best to make your stay enjoyable and dynamic: an on-site gym, meeting rooms and 24-hour room service. Or relax and invigorate at the in-house spa and wellness centre with a variety of facial and body treatments.

 

heritageHeritage Queenstown is located just outside the town centre. The hotel offers  alpine-style accommodation with stunning views over Lake Wakatipu and Queenstown. Heritage Queenstown buildings are the typical mountain style accommodation made from centuries-old-schist stone and cedar. The world-class services and facilities feature a heated indoor/outdoor swimming pool, sauna, gym and an elegant restaurant. Great choice for guests interested in experiencing comfort and sophistication.

 

Screen Shot 2015-06-15 at 11.20.44 amVilla del Lago offers quality self-catering apartments on the shores of Lake Wakatipu, just 2 minutes drive from Queenstown. With stunning views to the Remarkables Mountains and across the lake, the property has its own pebbled beach. Villa del Lago features ski, bicycle and sports storage and is close to all the attractions Queenstown has to offer, from vineyards to ski fields to bungy jump and world-class golf. Impeccable surroundings and quietude by the lakeside Frankton walkway and cycle path, and located only a 20 minute walk from the Queenstown centre.

 

Screen Shot 2015-06-15 at 11.23.49 amMillennium Hotel Queenstown is located in central Queenstown and only 2 minutes away from local shopping and entertainment areas and close to all ski fields. It features sauna, spa, gym, massage therapist, sightseeing and activities desk. Millennium’s Observatory restaurant speciality is modern New Zealand cuisine and the Club Bar is ideal to relax after a great day outdoors. Millennium Hotel Queenstown offers luxury and elegance committed to minimize environmental impact.

 

Hotel ExteriorHilton Queenstown Resort & Spa situated on the eastern shore of Lake Wakatipu in the Kawarau village. The Resort & Spa facilities include indoor pool, a fitness centre and the Eforea spa. The rooms offer spectacular views to the lake or mountains and amenities to keep guests focused at work or relaxed in the luxurious bath or in front of the fireplace. At Wakatipu Grill Restaurant guests can sample local seasonal produce while enjoying the scenic views and the Cru Wine Bar & Lounge specializes in local and international wines. Workout in the fitness centre, take a swim in the 25-metre heated lap pool or indulge in a treatment at the Eforea Spa. Pure indulgement for travellers interested in vineyards and fine dining.

 

(Contact Angel Association New Zealand at [email protected]  to get the promotional code for discounted delegate rates at these hotels).

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ABAF 2015, Queenstown, NZ – the Social Scene

Get amongst it!

ABAF 2015 and the lively social scene of Queenstown

The Asian Business Angels Forum being held in the extraordinary scenery and atmosphere of Queenstown will add to a valuable experience. This lake and alpine resort region surrounded by magnific mountains and nestled on the shores of crystal clear Lake Wakatipu is inspiring and revitalising.

This summit is a wonderful opportunity to connect with the most refined and active angels from around the globe to learn more about exits, the best practices, investing trends, succeding in the changing early-stage investment environment, and how to attract cross-border invetments.

We do hope you enjoy your time and be indulged by Queenstown’s top restaurants. Some of them are listed below:

 

bbq TSS Earnslaw / Walter Peak – Thursday dinner: The ultimate kiwi experience. Enjoy a lake cruise on board TSS Earnslaw and feel like going back in time. Admire the sumptuous alpine scenery before disembarking on Walter Peak for a gourmet BBQ dinner. Indulge best-quality meats, delicious vegetables, salads and finish with a delightful selection of desserts.

 

Rata

Rata: The award winning restaurant owned by internationally    acclaimed Michelin starred-chef Josh   Emett added to the heritage building and relaxed decor holds all the elements to a top-notch cuisine experience.

 

 

 

 

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Amisfield Winery & Bistro: Located in the quintessential building housing the cellar door and bistro offering exquisite selection of seasonal dishes that compliment the fruit purity quality of the Amisfield wines.

 

 

 

 

 

queenstown-4

 

 

Botswana Butchery: The restaurant offers a diverse menu with a speciality on fine cut beef and local organic foods accompanied by the perfect wine from the impressive private 1800 bottle cellar.

 

 

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Early-stage board governance

Improve your chance of success with AANZ’s governance course!

A board is a valuable asset to any company. In the development of early stage, high growth ventures the board is critical.

On Monday 30 March, 9.30am to 4.30pm the AANZ are running the second iteration of a course we are building to build governance capability.

There will be a charge of $350+gst per person to attend the course. This compares to the usual IoD course charges of around $800 for full day courses!

The board is one of the most useful mechanisms through which angels can help founders navigate risks. Particularly those inherent in a period of extreme uncertainty where the customers, business model (and more) are being validated.

At an earlier iteration of the workshop Marcel van den Assum explained, “boards in angel backed companies are navigating the ledge… constantly! So its about bringing some discipline to how the company grows without moving away from where the excitement is.” Drawing on his experience in growing and selling Greenbutton he went on to say “during the early stages when the activities of the business are about discovery not execution a level of intellectual engagement and willingness to use your own resources and networks is necessary.

“It’s all about managing risk, which includes finding mentoring for special elements of the business and so much more…it’s complex! But it is extremely rewarding when an early-stage board is operating effectively” he concludes.

Recognising angel investors have an important part to play on these boards and that they should be willing to roll up their sleeves and get involved with the executive team, the AANZ will work with the Institute of Directors to develop a specific early-stage board directors’ course.

Designed to up-skill angels and assist our investee companies to grow faster, stronger and more successfully the course includes information on how to;

  • give founders the confidence to move forward
  • manage the “softer side” of a high growth company, including making sure that the founders don’t burn out
  • introduce the company to sales channels and resources.
    manage the cadence and speed of business development.
    devise frameworks for making tough calls with imprecise information
  • define leading indicators; and,
  • govern according to the requisite legal structures

If you would like to take part (and in turn contribute to its development) the AANZ has some capacity to support angels who need to travel to Auckland. Email [email protected] for more information.

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Tom McKaskill talks Angel/Founder alignment #AANZSummit14

Angel Association New Zealand Summit 2014

Each year’s Angel Association New Zealand Annual Summit brings keynote speakers from around the world to share their knowledge and networks.

In 2015 we will hold a special Summit, merging it with 2015’s Asian Business Angel Forum and welcoming Angels who are looking for opportunities to do business with New Zealanders.

In 2014 we welcomed Australian entrepreneur and Angel investor Tom McKaskill as guest speaker and panel member. Tom McKaskill has some pithy advice for angel investors and angel backed companies. He encourages us to build ventures that acquirers can exploit quickly on a global basis and create alignment early on.

Read more from Tom here

To view this video on youtube click here

ABAF2015, NZ
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John Huston: Knowledge and Insights #AANZSummit14

Angel Association New Zealand Summit 2014

Angel Association New Zealand Annual Summit 2014 welcomed leading American Angel John Huston as keynote speaker and panel member to share his knowledge and insights with the New Zealand Angel investing community.

Read more from John Huston here:

http://www.angelassociation.co.nz/news/angel-entrepreneur-news/2014/10/angels-light-path-nz-start-ups

http://www.angelassociation.co.nz/news/2014/10/guest-post-john-huston-keynote-speaker-aanzsummit14

Download resources shared by John Huston here:

http://www.angelassociation.co.nz/resources/john-huston-presentations-documents

 

To view this video on youtube click here

ABAF2015, NZ

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Marcel van den Assum’s Intro #AANZSummit14

Angel Association New Zealand Summit 2014

Review some of the greatest moments from AANZ Annual Summit 2014 in Auckland.

We have prepared a selection of videos from some of our notable speakers. This first one features Suse Reynolds’ opening and introduction to the Angel Association New Zealand Annual Summit 2014 from Chairman, Marcel van den Assum and guest Hon. Stephen Joyce, MP.

Read more from Marcel van den Assum here

 

To view this youtube video click here

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Jim Connor talks Acquisition Strategies #AANZSummit14

Angel Association New Zealand Summit 2014

Angel Association New Zealand Annual Summit 2014 welcomed Jim Connor, Board Director and founder of Californian Sandhill Angels to speak about how to find and engage with acquirers, all the elements needed and how to obtain information in the process of planning acquisition strategies.

Read more from Jim Connor here

 

To view this video on youtube click here

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Hon. Stephen Joyce introduces #AANZSummit14

Angel Association New Zealand Summit 2014

In Auckland, New Zealand, October 2014, over 120 Angels, members of networks and funds across New Zealand, along with international guests from the United States, Australia and Singapore came together for 2 days of mind sharing, networking and collegiality.

The event was introduced by AANZ Chair Marcel van den Assum followed by Minister Stephen Joyce who gave an opening address acknowledging the special role angel investors play across the country. The work they do, by choice, contributing to building the confidence, capabilities and capacity of entrepreneurs, investing in them to achieve success was recognised as bringing significant benefit to New Zealand’s economy and its positioning as an innovative and future focused country.

To view this video on youtube click here

ABAF2015, NZ

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We need to focus more on returns!

As angels we want to create value. We get an immediate sense of satisfaction when that value is reflected in the social and economic outcomes of our engagement – developing entrepreneurial skills, creating jobs and supporting innovation.

But in fact if we really want to make a difference and keep making a difference, we must generate financial returns on our angel investment. It’s only then we will truly maximise – and sustain – the social and economic outcomes we seek.

It takes focus and discipline to generate a return on angel investment. As we’ve heard so often, this needs to extend from the founder to the board and shareholders. It’s easy to get excited about where the next sales are coming from, who the next hire going to be, when do we set up offshore and is the next iteration of the product a real game changer. Of course these things are all important but they must be set firmly in the context of their contribution to maximizing the financial returns.

So what does this mean in practice?

As well as the focus from day one, there needs to be an awareness that if you are building a business to generate a return to shareholders, you care less about tactical cash – solvency parameters not withstanding! – and more about the capital strategy.

There are of course different pathways to a return, all of which will give you a different result. Your strategy might entail securing follow-on angel funding, it might entail looking for VC involvement, it might include an exclusive contract arrangement with a potential acquirer or it might be bootstrapping and leveraging grant money. These will all have their own outcomes and impact on the returns you eventually make as an angel investor.

All of these strategies require a laser focus on the sort of business you are building and for who. At every board meeting time should be set aside to revisit the capital strategy to address what it is going to take to secure capital and from who, to ensure that you are building relationships with the right people and that you are doing so well in advance of calling on funds. All these things are vital because they make sure the  company is focusing on generating the value follow-on investors are looking for.

I also can’t help wondering if, as an industry, we need to start thinking about potentially saying “no” to new investments to ensure the deals we’ve already done have the necessary capital and capability applied to succeed. We would be doing this on basis that we are getting more mature as an industry and have a better sense of which companies are going to generate the returns we seek. I think its time to be taking a proactive approach to portfolio rationalization.

How about an investment evening exclusively for these “elite” companies? Such an evening would be all about the “return on investment” proposition and what’s needed to get there. These “elite” companies would be pitching for funding to get to an IPO or a trade sale for example, and would be telling us what it’s going to take to get to these end points within say 1-2 years.

I’d love to see what this might achieve!

Marcel

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Angel behaviour – what should we expect?

Growing the business of angel investment in New Zealand is largely a result of “member get member” referrals. This is true when it comes to attracting new members to the networks and it’s true when it comes to sourcing new investors for our early stage funds.

So as we head into a new year, with lots of exciting opportunities looking for our support, a reminder about the standards of behaviour we should we expect of each other seemed a good idea.

A year or so ago, the Angel Association’s members wrote a Code of Conduct which sets out these standards.

Our values

We agreed the following values are important to us:

  • To be passionately ambitious for angel ventures,
  • To be collaborative and collegial, and
  • To act with integrity and honesty.

Our expectations of behaviour

These values are reflected in how we should behave.

One of the most fundamental components of success in the angel world is speed. So we have made it clear that communicating quickly and clearly is vital.

We also put great store on ‘doing what you say you are going to do’; keeping promises and commitments. If you commit to invest or offer to make an introduction – do it. If said you would sign a document – do it. Of course this isn’t always possible – we all know “life” happens – so if something does get in the way of you doing what you said you would, communicate!

Integrity is everything in angel investment which is why we highlighted respecting confidentiality and disclosing conflicts of interest.

We also expect professionalism. Dealing professionally with each other sets the standards we expect of the ventures we invest in as they grow into world-beating enterprises. Time and energy can be scarce resources in angel investment. This can make it challenging to operate at the levels of professionalism we are used to in other parts of our lives. It’s nevertheless important to ensure timely reporting, compliance with relevant legislation and good businesses practice.

So these are the principles which serve as the foundation for our dealings with each other and are the standards others working with us – incubators, accelerators and professional service providers -should expect.

What does this look like in practice?

The deals

Founders seeking angel investment should know that our members are looking for a credible entrepreneur with aspirations to grow an international business with a well defined product, customer and market. Founders should expect prompt, objective and constructive guidance from our members, whether or not they ultimately secure capital.

Doing the deal – syndicating, due diligence and closing

Any deal approved for presentation by one of our members will meet required standards of presentation in terms of content and performance to pitch to any of our investors. And if other AANZ members are approached to take part in that deal, they have made it clear they will do their best to disseminate that opportunity as quickly as possible. In fact if a deal has been approved for presentation by one of our members, it can only be declined for presenting to another of our members if it lacks alignment with their investor’s preferences or their fund’s portfolio strategy, but not for lack of investment readiness.

We all know the quality of due diligence has an impact on the success of a venture so our members support the use of DD checklists. We recognize the balance to be struck between thoroughness and timeliness. Our Code of Conduct notes that all investors must make their own assessment of any deal and we make it clear no one should place any reliance on satisfactory completion of DD by one of our members as a sign of the ability or future success of a venture and nor does anyone relying on any  member’s due diligence report have any recourse against that members.

Finally, once the screeds of documentation are completed we expect angels to respond to any final communication as quickly as possible and do their very best to secure relevant signatures.

Industry promotion

The world needs more angels so the last word in our Code of Conduct encourages our members to be “ev-angel-ists” for the space. You can expect our support if you need any help spreading the word about the benefits of angel investment. Do let us know if there is anything we can do!

Suse Reynolds

Executive Director

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Summit 2014 – Wrap from Marcel van den Assum

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It’s incredible to realise it’s been almost a month since the Angel Association of New Zealand’s Annual Summit. Reflecting the energy and activity in early stage investment at the moment, I have been flat out since working on a number of deals.

Over 120 Angels, members of networks and funds across New Zealand, along with international guests from the United States, Australia and Singapore came together for 2 days of mind sharing, networking and collegiality.

Having had time to absorb this years event, and those from previous years, I’m completely convinced of the important part the Summit plays in the development of the early-stage investment community. Supported by our sponsors Craigs IP, Kiwinet and this year, Callaghan Innovation it is a tremendous couple of days full of value for all who attend. 

As well as many many interesting conversations on and off stage, it is a great occasion to remind ourselves of the power of the community who invest in early-stage businesses. And by this I am deliberately referring to those who are members of the Association AND those who aren’t. I like to think of the Association as a champion for all early stage investors.

The Summit calls attention to the way we all contribute financially, intellectually and socially to the future of New Zealand in a very relevant way. 

Angels, members of networks or funds, or not know that intuitively. What became obvious just before and throughout the Summit was that we all need to make our contribution explicit. 

Suse has referred to data gathering in a recent post. It’s vital that we work harder to effectively disseminate the facts and stats around how we are creating economic value – from entrepreneurs, investors, academics, multi-nationals, governance, investors – and how that economic value extends to social value. Early stage investing plays a major role, its important and we should be proud of it. 

Minister Steven Joyce touched on this point a number of times, some of the panelists got into it too – without curating the data and communicating it effectively the media and therefore public perception of our activities focuses only on the failures or the exits and does not extend to what early-stage investment contributes economically and socially. We all need to play a part in telling that story. The value our work helps to deliver needs to be quantified – not just measuring output, but outcomes and impact too.

In my role as Chair of the Angel Association I am aware we need to be responsive and active in playing our part in this communication, but we also have to be clear about the data we collect at this stage. Curated through Young Company Finance (YCF) the data we currently release is clearly is a subset of wider activities – it only tracks investments through networks and funds, and then those only with Seed co-investment funding (SCIF) from New Zealand Venture Investment Fund (NZVIF). There is much work to do and we are committed to doing it.

Jumping now to the end of the summit it was great to hear from Peter Beck at Rocket Labs – aiming for the moon and beyond. In reaching for the stars – figuratively and literally – working to build a billion dollar business and send rockets into space Peter has decided he couldn’t do his work from anywhere else but New Zealand.  It was a great and inspiring example of the fact that we have some unique characteristics and therefore opportunities to take to the global market. As a collective many of us have been doing this for a while now and as we build the collective of people in this space we can support each other in going global and really make the most of this.

The visitors that contributed to our summit and the learning of delegates locally confirmed that our global reach works both ways. Jim, John and Catherine from the US shared their perspectives and have taken away a better understanding of the opportunities in New Zealand’s early-stage space. From Australia, Tom, Jim, John and Jordan, and Chris from Singapore made many connections and shared useful intel which will enable our countries to work closer together. It was made clear to us that by working together and opening up our portfolios to multi-nationals looking for early stage opportunities for acquistion, for partnership, we can activate more channels to market for more investees.

In this way our community plays a role that is important to NZ, and we are being followed and emulated in other parts of the world. We are global in our orientation and in the way we reach out to the world and are looking forward to bringing more international partners to New Zealand to showcase what we have available with the Asian Business Angel Forum next October. This an ideal forum to do that as well as a way to bring deal flow into NZ to globalise our own portfolios.

Locally we continue to emphasise diversity. There are different perspectives, there are different ways of doing this work – diversity is increasing. Early-stage investment, crowd-funding and more is starting to flourish. The Angel Association welcomes that diversity and the fact that we promote a united face going global, and yet maintain a healthy competitive attitude locally. 

Personally I am looking forward to working with all these different players that operate at the highest level of integrity, and philosophically are all committed to creating value, working together to increase the level of investment activity. I think it’s clear to all there’s not one right or wrong way of doing things, and I am looking forward to understanding more about some of the approaches and how they gain traction.

One of the highlights for me was Debra Hall’s angel profiling exercise which explored what kind of angel each of us is, or wants to be. It opened up the conversation about deal leads and investor leads in some detail. What became clear is that as well as this work being about management, governance, process and systems, the most important element is leadership – bringing people together from different backgrounds and being able to provide navigation towards a shared vision, to find and execute on an agreement on the desirable aspirational outcome. 

We as a community consciously look to build this leadership capability investing in people to grow and learn, in some cases investing in ideas because of the people more than idea, with the belief that a particular team can be an A team in the future even if the current idea doesn’t pan out. From an AANZ perspective, I would like us to get to a point where there is clear accountability around deal and investor leadership – if the business fails, we fail, learn from it and make the commitment to grow from that learning together.

All in all the summit was a very full, comprehensive learning opportunity. 

As Chair I’d like to thank all the angels who made the massive investment in personal learning by participating in the Summit. Your commitment is inspiring. Please share your experiences with your network. And I’d like to lead all of our thanks to Suse Reynolds, Executive Director of Angel Association New Zealand and her team who with very little budget and huge doses of goodwill make this event, and the work of the Association happen.

I’d also like to invite you to let us know if you feel there is something you can contibute, or some learning the AANZ should seek out and bring to our community.

To conclude, amongst all the complexity there remained a simple truth to what we do – create value and you’ll generate returns, and providing that I’m doing that and continue to enjoy it I’ll stay the course and work alongside you. I trust that you feel the same and look forward to a year of exciting activity and seeing more of you at ABAF in Queenstown, 13-15 October 2015.

Marcel

Marcel_van_den_Assum-1

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What can we do better? Collaboration and Completeness

Suse Reynolds, Executive Director, Angel Association of New Zealand talks about what we can do better.

Investing in high-growth, start up companies is highly risky.

Founders and their supporters, particularly investors, but also professional service providers and the government deserve recognition for their involvement. It’s a high stakes game and not for everyone.

I care enormously about the impact and inspiration the seriously amazing founders of high growth companies are having and will have on New Zealanders.

I also care so much about the people who are up for investing in these companies in a way only a tiny proportion of New Zealanders are willing or able to do.

At the Angel Association Summit recently there were over 120 of these terrific people. They all have different backgrounds, levels of wealth, experience and confidence. The time, energy, emotion and money spent by each of them is huge and the rewards are generally more “heart than head” or as John Huston described it at the Summit, “more physic than financial”.

Organised angel investing is still young, especially in New Zealand. Angel networks and funds as well as Individual angels, are building teams, capacity and capabilities to invest. One of the aims of the Angel Association – a collaborative body of networks, funds and some individual angel members – is to provide a way to share this capacity and capability across the country.

Networks and funds provide an effective way of bringing new investors into the space. They provide a mechanism to up-skill investors and gradually increase the size and number of their investments creating a broader base of support for the Xero’s, LanzaTech’s and Pacific Edge’s of tomorrow.

Angel Association members are seeing good deal flow as their own data and the latest Young Company Finance (YCF) Index demonstrates. Cumulatively, over $300 million has been invested in early-stage companies by angel investors since data was first recorded in 2006. And in the last couple of years the number of investors interested in engaging with angel networks has nearly doubled.

Most New Zealand angel deals are syndicated. The members of the Angel Association make good use of country wide collaboration and are constantly working towards improving the efficiency and effectiveness of the interaction. Kiwis are good at working together. As a small and diasporic nation we innately understand we need to work as a team to take on the big boys.

At the moment the data curated quarterly in YCF’s Startup publication does not seek to pick up all early stage company investment activity or hold itself out as doing so. Its focus is on deals being done by publicly visible, active angel networks and funds. Informal early stage investment, venture capital investment and IPO related investment and the very many private deals which are not reported are not included.

The YCF segment of the market is small but it’s important and it’s great that we can get such good measurements and insights into it.

By international standards YCF index is a rare and valuable data set because any form of angel investment activity is notoriously difficult to capture, being an intrinsically private pursuit.

At the end of the day virtually all of our technology companies – from the 1 month old start up to Fisher & Pykel Healthcare – can trace their roots back to at least some original “start-up” capital from angel-like investors in their earl-stage capital raises. Ultimately, the best environment for entrepreneurs is one where capital and expertise is available from a range of different sources. Sources to suit the startups, each bringing their own benefits and strengths to the table, which are not mutually exclusive.

The Angel Association is exploring ways we might curate or extrapolate what is happening to provide a clearer more complete picture of the New Zealand wide early stage investment activity for the benefit of founders – giving some insight into the range of investment options, and for New Zealand as a whole – to demonstrate how much team work takes place in our little country to encourage and support startups.

None of us has all the answers, however, we all have an interest in promoting success and profiling a complete picture of how incredibly rewarding it is to be involved at ground level with the super stars of New Zealand’s economic future.

collaborate to success

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Grow your wings!

If you are a successful, exited entrepreneur who is looking to re-invest some of your returns and share your knowledge and skills with new entrepreneurs who are starting up, commercialising new ideas then Angel Association Summit 2014 is for you. #AngelSummit14:

• Meet members of Angel Groups and funds from all over New Zealand
Get to know those that run the private funds, investment groups. Learn how they work and what they are interested in.

• Get connected with the activity in the entrepreneurial eco-system
See evidence of the deal-flow. Meet people behind some of New Zealand’s most exciting and promising startups.

• Build your capacity
Gain relationships with a range successful people, understand how deals come together and strategic partnerships add the most value.

• Build your capability
Acquire contacts with a wealth of experience and knowledge who build substantial enterprises across multiple industries and markets.

• Learn about risk-mitigating government co-investment tools
Know what’s available to seed and early-stage investors.

Come to the Angel Association Summit which has been called:

“One of the TOP angel summits in the WORLD,”
– Bill Payne, US Angel Capital Association Hans Severiens Award Winner

Find out more about the Angel Association Summit 14.

Book one of the remaining tickets to the Angel Association Summit 14. 

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Guest post: John Huston, Keynote Speaker, AANZSummit#14

Tags: Angel Summit

“Having previously visited your gorgeous country I’m excited about returning, but this trip will be even more fun because instead of being a tourist I’ll be getting to interact with your innovation community and business angels.

I very much look forward to comparing and contrasting your angel investing strategies and tactics with ours.

Over the last 15 years that I’ve been investing in early stage ventures, I’ve been quite fortunate to have interacted with many angels and angel groups outside the U.S.

I’m always interested first in learning about the various types of governmental programs aimed at fostering the country’s entrepreneurial spirit. Then I like to understand how the angels’ optimize the impact of these programs. And, naturally, I like to compare notes on what is working in each locale to build entrepreneurial wealth.

It seems that in every country I leave with a few more “best practices” to add to my inventory and I’m confident that will be one of the pleasing outcomes of my visit.

I’m less confident I can provide much wisdom to reciprocate, but I can share some of the approaches we’ve tried that have not worked. Candidly, I think the 340 members of my angel group feel that sometimes knowing what to avoid doing has more value than thinking there is one silver bullet in this angel investing realm. We do think there is some silver buckshot, however, and I can’t wait trade buckshot stories with your angels.”

John Huston, Ohio TechAngel Funds

Find out more about the Angel Association Summit 14.

Book one of the remaining tickets to the Angel Association Summit 14. 

AngelSummit14

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Lead Partners

NZTE NZVIF PWC

Expert Partner

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AANZ Summit Sponsors

Callaghan Innovation “UniServices” Kiwinet “Spark”