This story profiles the role experienced angel investor, Susan Iorns has had in the journey and growth of one of the first Lightning Lab graduates, Expander.
Making a compelling pitch to investors isn’t easy, but Ollie Langridge’s bold claims attracted considerable interest from investors before he even had a product, let alone started marketing it.
The former TV commercial director first addressed potential investors a couple of years ago at Wellington’s startup accelerator Lightning Lab’s demo day. He told them he and business partner Paula Nightingale had an idea that could potentially prevent infant deaths, like those caused by the Chinese melamine scandal.
This bold claim related to the technology they would eventually develop, based on QR codes (abbreviated from Quick Response Code, a two dimensional matrix-like barcode) which could mark products with unique codes like a fingerprint.
Consumers can easily scan this code with their smartphones to check a product is authentic and safe – an option that is in increasing demand given the increase in food safety incidents and resulting tragedies such as the infant deaths in China caused by contaminated milk powder.
Langridge’s claims were enough to whet the appetite of a number of early stage angel investors present at the demo day, including Wellington-based Susan Iorns, who together with other members of Wellington’s angel group, Angel HQ, and the NZ Venture Investment Fund, invested $500,000 to develop Langridge’s Green Codes cloud-based technology under the company name Expander.
Iorns was so impressed she even became chair of the fledgling company. “I look for a couple of things when I’m considering investing in a company – whether the company is likely to create high-skilled jobs in New Zealand and whether it is likely to succeed abroad,” Iorns said.
“Expander’s technology was both scalable and I didn’t see any geographic boundaries. Ollie’s pitch was also a great and worthy call to action.”
A subsequent, oversubscribed capital-raising round last year secured even more funding to help accelerate Expander’s market overseas, says chief executive Erwin Versleijen, who joined the company early last year.
Versleijen formerly worked in mergers and acquisitions with PwC and commercialised products for Minolta, Samsung and BMC Software. He says he saw Expander’s potential from his first introduction.
“It’s a startup in the right space, so it’s likely to be a leader in its field,” Versleijen said.
The anti-counterfeit and brand protection market is expected to grow from US$3.4 billion today and the traceability technology market is expected to be US$14 billion by 2020.
Consumers are demanding more and more information about the origin of products before they buy, he says. “With ever increasing competition for market share, traditional media and sales techniques simply aren’t enough anymore.”
You don’t often see New Zealand shoppers using their smartphones to scan products but it is common in Southeast Asia, with most smartphones owners in China using QR code readers daily, Versleijen says.
When consumers scan Expander’s QR codes on a food or beverage product they are directed to a mobile landing page where they see where the product came from and who made it, nutritional facts and allergy information, and how to get in touch.
Consumers can also register to receive more information like recipes and accept invitations to social media.
For companies, this technology allows them to increase loyalty and brand equity, and get valuable data on where and how consumers are buying their products, Versleijen says.
Expander’s QR technology differs from the competition because its QR codes are randomly generated and not reliant on a legacy system, he says.
“Consumers can scan the codes from any reader on their smartphone. There is no dedicated application to download or training required.”
This year Expander is targeting the global dairy industry.
Exporters of infant milk formula and fresh milk to China need to have unique identifiers, such as a QR code for traceability on each package and a recall process to meet regulatory requirements.
Expander has cracked the QR code, now it’s ready to crack the international market, Versleijen says.
First published in NZHerald 12 March 2015