Looking for an angel at the Summit
First published in the New Zealand Herald on Friday November 23, 2012
From clever ‘bio-beads’, to seamless online searches, to virtual worlds for kids, a tempting array of entrepreneurial talent was on offer at this year’s Angel Investor Summit, writes Lesley Springall.
Tracy Thompson feels as if he has done little else but raise capital for the past four years.
The United States-born chief executive of biotechnology company Polybatics says raising money in New Zealand is like a treadmill you can never turn off.
“It’s constant. I feel like I’m on life support thinking ‘quick nurse, bring me another drip bag’.”
Polybatics was one of 13 carefully selected companies at this year’s Angel Association annual summit. The 13 offered a smorgasbord of investment potential – from formal investment virgins to those who, like Thompson, have done it all before, in a diverse range of sectors and regions.
Each had just eight minutes to flaunt their figures to a host of angels and potential angels – people with a bit of spare cash who might be persuaded to take a punt on the Kiwi companies of tomorrow.
“It’s like a normal angel investor club evening, but on steroids,” says Marcel van den Assum, Angel Association vice-chairman.
He led the charge, introducing the company showcase and appealing to the 200 or so well-off individuals gathered at Te Wharewaka o Poneke on Wellington’s waterfront, by explaining why he became an angel.
Yes, there was the chance of making money, but it was more than that, he said: it was the chance to do something new; something different; something for New Zealand’s future.
Each of the 13 firms pitching had already been put through their paces by an angel group or angel investment firm, so they all had a lead angel to champion their cause. “The majority of investors are followers, so clearly you want to pitch deals where there is already a reputable lead that will act as a catalyst in the equation,” says Van den Assum.
Though important for the firms, the evening was also about attracting new blood into the angel world, says Dave Allison, showcase organiser and business strategist at Wellington regional development agency spin-off Creative HQ. “First and foremost the event is about showcasing angel investment. We wanted people to get a flavour of what angel investment was all about.”
Van den Assum says it’s “critical” to attract more angels to the cause. With more formally accredited angels, the sector has more clout with the Government, more capital to draw on to take investments further down the track and more like-minded folk to share the workload and risks.
“You can discuss deals with somebody; you don’t have to be the lone wolf, putting everything at risk on one deal. You can spread the risk and use others’ expertise,” says Allison.
“This is about creating value; connecting the ecosystem; and being willing to go out and take some chances, accept some failures and celebrate the one in 10 that’s a fantastic success.”
Many of those present were “stunned” by what was on offer, he says. “A lot of people come along and don’t ever become angels; it’s not their thing. But no one is ever disappointed they spent the time looking.”
Here are the companies that stood out (read more about them by following the links):
Others pitching at the 2012 showcase were:
- Vigil, a wireless patient monitoring technology that provides real-time vital signs monitoring.
- 77 Pieces, a business employing Weta Digital-type technology that allows online buyers to realistically predict how they will look in the clothing they might buy.
- InvisiShield, a hush-hush company that plans to revolutionise the work of the humble scarecrow.
- iGloLEDset, a complicated name for a business that offers a funky Wi-Fi controllable LED lighting system.
- Showcase, a complete set of sales tools that can be updated at the touch of a button so salespeople never again have to worry about suitcases full of brochures or bar charts.
- HSL, or Hunter Safety Lab, which has come up with some clever technology to prevent hunters from accidental shootings.
- ShowGizmo, a smartphone app for event organisers to better connect with their audience.
Though some of the companies presenting were not keen on having their wares talked about too publicly, others like ShowGizmo founder and managing director Frances Manwaring were peeved to be left out. Allison was also lambasted by some company founders who were disappointed at not making the showcase cut. But then, every founder and every investor believes they’ve got the next big thing, he says. At best, however, only 10 per cent of angel-investment companies make big returns for their investors, with many investors counting themselves lucky if, after several years of investment, they get their money back.
The Herald will be keeping an eye on its 2012 Angel Summit showcase picks to see who made their capital raising targets, what they’ve done with the money and which, if any, might be on track to making a few angel dreams come true.
If you would like to find out more about the 2014 Summit, please see AANZ Summit 2014.