Idealog’s Guide to Tauranga: Follow the money

Businesses in Tauranga looking to scale up should count themselves lucky: the Bay of Plenty is one of the only regional centres in New Zealand with funding available for nearly every stage of business growth. There are three organisations on hand ready to help: early-stage investment provider Enterprise Angels, tech investor and incubator WNT Ventures and later-stage private equity provider Oriens Capital.

For companies in the early stages of investment, WNT Ventures is technology incubator that’s been put together to nurture innovative ideas nationwide. It’s currently on a five-year pilot trial receiving government support through Callaghan Innovation.

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Wherewolf sets course for US after raising $550K

Adventure tourism software developer Wherewolf is gearing up for a push into the US after securing $550,000 of angel investment.

The Queenstown-based firm plans to open an office in the States on the back of the over-subscribed funding from the Flying Kiwi Angels.

Co-founder Ben Calder, who has just returned from a month-long trip to America to look at office locations and talk to potential partners, said the investment will allow the company to increase functionality as well as increase sales in the northern hemisphere.

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Kiwi tech company raises millions for expansion

Kiwi technology company Feijipiao is expanding across New Zealand and eyeing other markets after closing a multi-million dollar angel investment round.

The company, founded in 2016 by Peter Li, is a Chinese language online travel business, offering flight bookings across multiple airlines in Chinese.

The website offers competitive fares and multiple payment solutions, in either Chinese yuan or New Zealand dollars, through automated search, booking, and ticketing processes.

The investment was headed by The Icehouse and Chinese-led angel fund Eden Ventures – its first investment.

Led by Chinese venture capitalists and entrepreneurs, Eden Ventures focuses on high performing start-ups, with specific interest in serving Chinese in New Zealand or enabling New Zealand founders to launch into the Chinese market.

The funding values Feijipiao at between $5 million and $10m, and would be used to hire staff, open its first New Zealand office in Auckland and fund further growth, as well as prepare the business for expansion into Australia and other markets.

The company was already bringing in revenue of about $900,000 per month, with Li saying he expected this to hit $1m in the coming few months.

Icehouse fund manager Jason Wang said both groups had invested based on Feijipiao’s growth in the five months since it launched, as well as the potential they saw for it.

“In three months, feijipiao.co.nz have transacted millions of dollars without a physical office, it’s all in the cloud.

“The results speak for themselves – this is a group of the right people doing the right thing in the right market.”

The company’s success had been helped by millennials influencing the purchasing behaviours of their parents, who tended to use more traditional travel agents Li said.

The investment would enable the company to continue its expansion as well as providing strategic value for the firm.

“Our team has built a strong foundation in New Zealand to prepare ourselves for expansion into global markets with established Chinese communities, and international students from China.

“By partnering with Eden Ventures and The Icehouse, we can tap into their expertise of forming long-term growth strategies for global expansion, and supporting technology driven companies.”

First published on nzherald.co.nz on 15 Sept 2017

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Hawkes Bay Angel Summit deemed a success for national and international attendees

The Angel Association of New Zealand’s annual Angel Summit in Hawke’s Bay last week was “brilliant” in every way, says executive director Suse Reynolds.
“The weather was gorgeous, the food was gorgeous and the people were wonderful,” she said.
She said it was a very productive two days for the 120 delegates, with some of the key issues being collaboration, the importance of New Zealand Inc and balancing investment with return – the conflicting need for return on investment with wider economic/social goals.
She said the Black Barn venue helped foster good relations between attendees.
“Business is all about people and it is important to build the foundations of trust.”
Angels flew in from throughout New Zealand and overseas.
“The New Zealand Angel Summit has a reputation for being the world’s best angel conference destination. Last year when we had it in Queenstown we had 50 international visitors from a dozen different countries. We didn’t quite manage it this time around because last year’s was the Asian business angels forum and this year we were back to our New Zealand Angel Summit, but we still had Australian’s Chinese, Americans, Canadians and one Skyped-in from Zurich.”
Summit activities included an address from Economic Development Minister Steven Joyce, a visit to Rockit Apples’ packing shed and a dozen investment-related presentations.
One of New Zealand’s most prolific angel investors, Trevor Dickinson, was awarded the prestigious Arch Angel Award in Hawke’s Bay, which recognises individuals who have “steadfastly championed the cause of angel investment and investors”.
He has made more than 50 investments in early-stage and startup companies – the vast majority of which are angel-backed firms from throughout the country. He is on the board of Wellington-based angel investor network Angel HQ, and received the organisation’s first lifetime membership based on the value of his investments made through the group.
Angel HQ manager Dave Allison said his contribution to the angel investment community was marked.
“The energy and enthusiasm he brings is extraordinary, whether it’s on the boards of companies, or advising entrepreneurs, or making deals happen by bringing people together,” he said.
The English-born former geologist worked in the UK oil and gas industry before mortgaging his house to develop state-of-the-art measurement-while-drilling technology.
GeoLink success allowed him to retire to New Zealand where he was a founding investor in startups including Lightning Lab, Wipster, HydroWorks, Nyriad, Cloud Cannon, 8i, Flick Electric and Times-7.
Former Arch Angel winners also include The Warehouse founder and long-time angel investor Sir Stephen Tindall and Andy Hamilton, chief executive of Auckland-based incubator and business educator The Icehouse.
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Theresa Gattung Venture Capital fund

ArcAngels and Angel Association New Zealand today welcomed the launch of Theresa Gattung’s new Venture Capital fund which aims to raise capital from women, for women entrepreneurs.

“Boosting the pool of capital for entrepreneurs is vital for New Zealand’s ecosystem of start ups to grow,” said Cecilia Tarrant, Chair of ArcAngels, a New Zealand based angel organisation focused on funding women entrepreneurs.

“As an organisation, focused on women-founders, we are delighted to hear Theresa Gattung, one of New Zealand’s preeminent business leaders has launched an initiative to fund women entrepreneurs, supported by women. Having a Venture Capital fund will help expand the capital and mentorship female entrepreneurs need to develop their businesses,” Tarrant said.

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Simon Brown: Entrepreneurs and investors descend on Hawke’s Bay

For two days last week the Black Barn Winery in Havelock North was the focus of the world’s venture capital and angel investor communities.
Entrepreneurs and investors from New Zealand, Canada, North America, China and Europe spent last Thursday and Friday at the 2016 NZ Angel Summit discussing investment strategies, sharing their expertise and creating opportunities for innovative Kiwi start-ups in need of early stage finance.
These were some of the most successful investors in their field. People like North American business and equity finance consultant Ross Finlay, who has come to New Zealand with the support of Callaghan Innovation to help local businesses understand what Angel Investors expect from them, to show them how to establish relevant relationships and introduce them to North American and NZ Angel networks.
Ross has secured 35 Angel investment deals in recent years and has assisted in the development and review of countless business plans for start-up companies.
He has extensive networks within the world of international finance and he knows how to leverage them for the greater economic good.
Hawkes Bay’s stunning environment was a bonus for local and international financial high flyers like Ross but they weren’t here primarily for the scenery. These were all seasoned and experienced business people who have made their money in a range of sectors.
Naturally, they’re looking for a return on their investment but they’re also motivated by a desire to help others with the same drive and ambition they have and, crucially, to do their bit to grow the New Zealand economy.
Government ministers and officials, colleagues from Callaghan Innovation and the nationally located business incubators also attended the summit.
They came away with re-enforced enthusiasm and confirmation of the optimism and dynamic evolution in this fast growing sector of our economy.
Last financial year was a record breaker in terms of deals made with Kiwi start-ups and dollars invested.
Deals worth a total of $61.2 million provided 92 creative and passionate New Zealand entrepreneurs with the kick start they needed to get their great idea off the ground. In addition to this investment, Callaghan Innovation supported 152 start-ups through incubators.
That’s an unprecedented deal flow and a strong indication that NZTE’s Investment Showcase events and Callaghan Innovation’s incubation funding and accelerator programmes are bearing fruit.
New Angel regional networks are forming. Syndicated Angel funds are proliferating and long standing networks are experiencing a surge of interest. Wellington’s Angel HQ, for example, has gained 30 new members in just the last six months.
Increasingly businesses are successfully exiting the start-up phase of their journey but still face challenges in accessing growth capital and appropriate commercialisation expertise. International capital exists but the New Zealand eco-system is looking at how it can work better together to facilitate the access to it.
We’re doing great but we can do better. Investment in research and development in New Zealand still lags behind OECD countries. Areas like SaaS, FinTech, AgriTech and other areas of the digital sectors are doing well but there are also great ideas brewing in MedTech, BioTech and food and beverage production.
A few of those could well be the disruptive industries we need to take New Zealand and the world into a healthier and wealthier future.
– Simon Brown is general manager accelerator services of Callaghan Innovation

First published – NZ Herald 6 November 2016

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‘The jockey’ key for angel investing

Investing in high growth companies is like a long horse race and understanding the jockey you’re betting on is key for angel investors, says veteran Canadian angel investor Ross Finlay.

Finlay, co-founder and director of the First Angel Network Association in Atlantic Canada, is one of the international speakers at the annual Angel Summit in New Zealand underway in Napier.

He said before angels commit their money they have to pick the right jockey and the earlier stage the company is, the more that matters.

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Trevor Dickinson named New Zealand Arch Angel 2016

One of New Zealand’s most prolific angel investors, Trevor Dickinson, has been awarded the Angel Association of New Zealand’s (AANZ) prestigious Arch Angel Award at the 2016 NZ Angel Summit in Hawke’s Bay.

The Arch Angel Award is the highest honour in New Zealand’s angel investment community, and recognises individuals who have steadfastly championed the cause of angel investment and investors.

The award highlights the work of angel investors who give a significant amount of their time and money to help startups and early-stage companies – as well as their founders and teams – to reach their potential.

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MEDIA RELEASE: Canterbury Angels flying with new partnership

The New Zealand Venture Investment Fund is partnering with the newly formed Canterbury Angels to invest into start-up companies. The Christchurch-based angel investor group was formed in 2015 and now has 35 members, most of whom are experienced investors or have been involved in establishing businesses previously.  Its leadership includes chair Ben Reid, who chaired the Canterbury Software Cluster, Shane Wakelin, Joan McSweeney, Ria Chapman, Mark Cathro, Raphael Nolden, Ian Douthwaite, and SLI Systems co-founder Geoff Brash. Canterbury Angels chair Ben Reid said the partnership will bring more investment into innovative companies in the Canterbury region and around New Zealand. The new investment partnership with NZVIF means that when Canterbury Angels invests into a new company, NZVIF will match investments dollar-for-dollar giving both investors and entrepreneurs confidence that the investment round will be successfully completed. Our focus will be on new companies emerging in Christchurch and nearby.  But our members will also invest in syndicated opportunities throughout New Zealand to ensure we have a broad portfolio of companies. “Based on our experience to date, we expect to see a healthy deal flow.  There are a lot of innovative ideas in Christchurch that are seeking capital.  We have two universities which produce high quality research.  We work closely with other parts of the innovation ecosystem in Christchurch, such as EPIC, Lightning Lab, Greenhouse and the newly-opened Vodafone Xone.  As new startups emerge from the ecosystem, this partnership will help to provide some of the early stage capital to meet their needs. “Our expectation is that the partnership will run for around four to five years, investing into around 10 to 15 young companies during the first 12 to 18 months. With NZVIF committing on a matching 1:1 basis with Canterbury Angels investors, it doubles the capital available to a company than would be the case if we did not have the partnership.” This is the sixteenth partnership NZVIF has entered into through its Seed Co-Investment Fund and the second in Christchurch, having previously partnered with Powerhouse Ventures.  To date, NZVIF and its angel partners have co-invested around $142 million into over 150 companies. NZVIF investment director Bridget Unsworth said that the new partnership is needed to keep up the momentum in the angel investment sector. “The past year has seen continued healthy investment activity across New Zealand with over $60 million invested by angel funds and groups.  Christchurch sees around 10 percent of angel investment activity.  With Canterbury Angels now actively investing alongside other early stage investors, it provides another source of capital for entrepreneurs in Canterbury. “There is a healthy level of syndication of investments between different angel groups meaning they are likely to invest in opportunities throughout New Zealand.  This allows groups like Canterbury Angels to diversify their portfolios beyond just the local opportunities.  Early stage investing is a high risk investment class and so diversification is important. “Current investment activity is healthy and there is a good pipeline of young technology companies needing investment capital to develop.  Since NZVIF began collecting the data in 2006, angel groups have invested over $400 million into young technology companies.” BACKGROUND INFORMATION Canterbury Angels Canterbury Angels is a new angel network and was established in 2015.  It aims to be a broad-based network drawing in investors from throughout Canterbury.  It currently has 35 members and has made four investments in its first year. NZVIF’s Seed Co-investment Fund NZVIF is involved with angel investors through its Seed Co-investment Fund (known as SCIF).  SCIF was established in 2005 to catalyse the growth of angel investment and has now invested into over 150 companies.  Its portfolio includes Christchurch companies like Hydroworks, Crop Logic and Invert Robotics.

Media contacts NZVIF: David Lewis, m: 021 976 119, david.lewis@nzvif.co.nz

Canterbury Angels: Gabby Addington, gabby.addington@canterburyangels.nz

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MEDIA RELEASE: Angels solid during first half

Angel fund investment was solid with $22.9 million invested during the first six months of the year, according to the latest Young Company Finance Index. The result was $3.3 million (or 17 percent) higher than the same period in 2015, although below the strong first half year periods seen in 2013 and 2014.

New Zealand Venture Investment Fund investment director Bridget Unsworth said the $22.9 million was invested across 46 deals, of which 78 percent ($17.9m) was follow-on investment and 22 percent ($5m) was new investment.

“This split was similar to the first half of 2015 and shows that investors were primarily supporting existing investments rather than funding new companies, following a period of much larger investing into new deals in the second half of 2015.”

Forty-six percent ($10.3 million) was invested into software and service companies, continuing that sector’s strong performance.  The next most active sector for investment was pharmaceuticals and biotechnology with 20 percent ($5.6 million) of investment.

Local early stage companies continue to attract overseas investors’ attraction. In addition to the $22.9 million of local investment, the angel-backed companies attracted a further $8.5 million from international strategic investors.

Angel Association chair Marcel van den Assum said it was great to see continued strong commitment from angel investors.

“We all know that angel investment stands or falls on the quality and volume of deal flow. There is no shortage of either at the moment with good opportunities also emerging from accelerators. This is very positive but it does create ‘pipeline’-pressure. Great deals will only be sustained with deeper pools of non-angel growth capital as angel-backed companies develop and need new capital to continue to deliver on their potential.

“Follow-on rounds continue to dominate, reflecting an appetite to realise business potential and generate returns.  Pleasingly, we are now seeing angel groups distinguishing between follow-on for companies meeting milestones and targets, rather than follow-on to keep investments alive.

“Emerging angel networks in Canterbury and Taranaki will gain confidence from this level of activity and their addition to the sector will support the increasing demand for capital and capability.

“It is pleasing to see the growing trend towards biotech investment, which should be an area of real strength for New.”

After a very busy period at the end of 2015, the 12 months to 30 June 2016 saw $64.5 million invested into young companies, continuing the strong trend over the past few years.  Cumulatively, $438 million has now been invested into young companies by angel funds and networks since the Young Company Finance Index began measuring activity in 2006.

Three angel-backed companies launched crowdfunding rounds and raised $1.87 million (all from Equitise).

 

 

 

 

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