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Diversity … making a difference and delivering outcomes

Last year we celebrated a decade of angel investing in New Zealand. And it was terrific to have that line up with some impressive success for angel backed companies with PowerbyProxi selling to Apple, Publons selling to Clarivate and ImeasureU selling to Oxford Metrics. Last year was also record year for ‘dollars into deals’ with a 26% increase on the previous year’s investment at $86m.

We are genuinely creating value for New Zealand and New Zealanders. At this year’s summit we will focus on amping up that value through the power of diversity. Why and how does a more feminine approach, both as founders and investors, add value? What values do different ethnicities bring to angel backed ventures to increase the prospect of success? Why is it important we include millennials in our ventures?

It’s all about making a difference… diversity and inclusion delivers higher value outcomes.

The 11th Annual NZ Angel Summit, 1/2 November, is being held at Marlborough Vintners, 10 minutes drive from Blenheim and in amongst the vineyards. We deliberately choose smaller intimate venues to ensure we create the right atmosphere for relaxed and rewarding conversations. Our last three summits have sold out as we prioritise places for those ‘doing deals’.

On the first morning we set the context for the two days by reviewing the year and have a session on the values that drive angel investors and how these impact on success. In the afternoon we apply these insights to the more practical aspects of angel investment with sessions on the new industry standard term sheet, how to ensure alignment with follow-on funding sources and dig into the government’s plans to support our endeavours, particularly with respect to tax reform. On Friday morning we focus on our own heroes and hear first-hand from some of our founders and investors who getting real traction offshore. All of this will be shot through with input from successful women and millennials in our community and deep engagement with Maori and our Asian investor migrant community.

Click here to register

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Angel investment rises 26% to reach record level

Startups in New Zealand received an unprecedented level of funding last year, with $86 million flowing into early-stage businesses across the country. That’s according to Startup Investment NZ, published by PwC New Zealand, the Angel Association of New Zealand (AANZ) and the New Zealand Venture Investment Fund (NZVIF).

“It’s exciting to see such a large number of deals coming through to support early-stage companies. We’re seeing investment levels that are almost three times what we saw just five years ago” said Anand Reddy, Partner at PwC New Zealand.

John O’Hara, AANZ Chair, endorsed this sentiment noting that membership of angel networks continues to grow with a new network established in Marlborough last year and a budding network getting started in the Hawkes Bay.

Established networks like Ice Angels in Auckland, AngelHQ in Wellington and Enterprise Angels in Tauranga are also experiencing growing memberships.

Driving the growth in investment dollars is an increasing number of larger deals in 2017, compared to the year before. The number of deals in 2017 held steady at 111 – one lower than the 12 months previous – the total amount invested has risen by $18 million, a 26% increase.

Offering some insight on the larger number of dollars being invested in a similar number of deals, John O’Hara suggested it reflected a maturing ecosystem.

“A number of the ventures angels have backed are now looking for larger capital injections to fuel their growth. With a thin VC industry, it’s not surprising we are seeing larger deal sizes.

John also offered a word of caution to investors and founders.

“The market’s a little frothy right now. We’re seeing some strong valuations. Entrepreneurs have to be sure they’re not setting the bar too high with their forecast results. If they fail to meet these, it’ll make it make it harder for them to get the next round of funding.

“And investors will be similarly impacted. Flat and down rounds do not impact well on portfolio return prospects.”

Click here to find out more about how the startup sector is evolving, and where it’s heading next.

Click here to dive into the data about this asset class.

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The network effect: NZ angel networks drive funding

Of the $86 million invested into young companies in 2017, over half ($49 million) came from angel investment networks, rather than individual funds or institutional investment.

“The strength of our angel investment networks in New Zealand is growing every day, which helps to explain why they’re responsible for a growing share of overall funding” says AANZ Chair John O’Hara.

“They’re responsible for over double the funding that’s coming through the next most-popular channel of angel funds.”

Raising funds from angel networks can take a little longer than other sources of early stage funding (such as mico-VCs and high networth individuals) given that sometimes over a dozen individual investors are collaborating to complete DD and gather the investment. Angel networks also tend to be run with a large component of voluntary input so founders and lead investors need to be committed project managers.

John notes that not only do networks tend to bring a larger pool of connections and expertise than single source funding options, they bring deeper reserves of connections for follow on funding.

“Angels are inveterate travellers and networkers and have connections in markets across the world which can be tapped for sales channels, in-market insights as well as follow on funding recommendations,” said John.

“Nothing beats getting on a plane with a line-up of carefully targeted meetings. New Zealand founders and investor directors need to spend more time in-market and be preparing for the founder to be based there,” John added.

He concluded by noting that lining up an in-market Board member was also an important component of scaling into offshore markets.

Click here to find out more about how the startup sector is evolving, and where it’s heading next.

Click here to dive into the data about this asset class.

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Lead Partners

NZTE NZVIF PWC

Expert Partner

AVID “FNZC.jpg”

AANZ Summit Sponsors

Callaghan Innovation “UniServices” Kiwinet “Spark”