NZTE Launches New Service To Assist Bus. Growth
NZTE Launches New Service To Assist Business Growth
3 DECEMBER 2003 - New Zealand Trade and Enterprise (NZTE) today launched a new service to help entrepreneurs and small to medium sized companies access investment - addressing one of the biggest hurdles to growth for New Zealand businesses.
The Escalator service replaces the Investment Ready Scheme* which had been delivered successfully for several years by EDANZ (Economic Development Association of New Zealand) and I Grow New Zealand Ltd. The new service will be delivered by four broking firms, in association with EDANZ.
NZTE Business Development Group Manager Hans Frauenlob says the Escalator service is targeted at entrepreneurial New Zealanders and innovative small to medium sized enterprises (SMEs) with strong growth potential and a need for additional investment to expand, diversify or commercialise a new concept.
It will provide all participants with specialised knowledge and training needed to seek equity capital and/or strategic local or international partnerships. Some companies will also get help structuring a deal and “taking it to market” with the aim of raising up to $5 million capital, he says.
In developing the new Escalator service NZTE has also decided to move the preliminary Investment Ready Training (previously provided as part of the Investment Ready Scheme) into its Enterprise Training Programme, delivered by contracted training providers around New Zealand to entrepreneurs, start-ups and SMEs.
“This leaves the new group of providers to focus on delivering an advanced level of training, analysis and deal broking assistance to users of the Escalator service,” Mr Frauenlob explains. “Along the way clients will undergo various assessments of their whole range of competencies, not just capital raising, and be upskilled by the deal brokers involved or referred elsewhere for assistance. They will learn more about their own business and gain a degree of investment readiness at each stage which sets them up well for the future - and ultimately if they do raise capital they’ll be well positioned for significant growth.”
A key component in being able to deliver the new, improved service is the enhanced offering provided by the three new brokers Deloitte, Ignition Partner and Realize Technology, Mr Frauenlob says.
“In addition to the skills that EDANZ and I Grow have already demonstrated, the inclusion of Ignition Partner and Realize Technology adds new talent in intellectual property licensing deals and the technology arena respectively. Meanwhile Deloitte, with its Fast 50 programme, national and international networks and range of skills adds another dimension.
“We believe the combined strength of the group and their networks will increase the likelihood of successful capital raising or other non-equity investment deals for the firms involved – building on the success of the previous programme, which in the first six months of 2003 led to 16 businesses raising an average of $450,000 capital.”
Water Master Ltd was one company to
benefit. Using the deal broking part of the service the
Auckland-based business was able to raise significant equity
capital from about 50 investors. This followed four years
developing an efficient method of extracting pure drinking
water from the atmosphere - with the aim of selling its
products into the huge global office water cooler market.
Director Campbell Stevenson says its successful and oversubscribed fund raising deal “bridged the gap between R & D and the market place".
“We were able to fund the important next stage of commercialising the intellectual property, establishing a manufacturing facility and getting distributor networks around the world.”
EDANZ Executive Director Ann Verboeket says the new Escalator service will deliver huge benefits to companies. “The broader range of deal brokers means that there will be much greater and more targeted investment opportunities for businesses across the whole country.”
Deloitte partner Ralph Marshall agrees, saying the complementary skills and experience of the group involved in providing the Escalator service puts participants in great shape to make a “step change” in their business.
"This service brings ambitious New Zealand companies together with experts possessing real insight of investors’ needs - providing an outstanding opportunity to equip these companies for growth."
Companies or entrepreneurs that use the Escalator service pay a small percentage of any capital raised to the relevant broker.
Mr Frauenlob says the new service is an excellent example of a government/business partnership in action. “NZTE has identified the need for such a service and is now working with experts to develop and deliver the required assistance.”
He is confident the Escalator service and the skills and networks of the expanded group of brokers will produce excellent results and complement the work being done by Investment New Zealand, a division of NZTE that works with New Zealand companies and foreign investors on significant opportunities, typically involving projects exceeding US$5 million.
*The Investment Ready scheme was established by Industry New Zealand which merged with Trade New Zealand on 1 July 2003 to form New Zealand Trade and Enterprise.
For further information:
Please visit www.nzte.govt.nz/escalator or contact NZTE’s Enterprise Hotline (0800 555 888) to obtain a Fact Sheet.
Deloitte brings together over 700 specialists providing New Zealand's widest range of high quality professional services. The firm focuses on audit, tax, technology and systems, risk management, corporate finance, human capital and business advice for growing organisations. Its people are based in Auckland, Hamilton, Wellington, Christchurch and Dunedin, serving clients that range from New Zealand's largest companies to smaller businesses with ambition to grow. Deloitte's local experts draw on best practice and innovative methodologies from around the world as part of Deloitte, whose 120,000 employees globally serve over half of the world's largest companies. Visit www.deloitte.co.nz
EDANZ (Economic Development Association of New Zealand)
EDANZ is a national body that promotes economic development, business growth and export opportunities in New Zealand. It represents the interests of independent Economic Development Agencies and economic development units within local authorities, city and district councils. EDANZ partners with key government agencies. It promotes best practice and business excellence and acts as a conduit for investment capital between investors and business. Visit www.edanz.org.nz
I Grow New Zealand Ltd
I Grow is a niche corporate finance adviser that specialises in advising New Zealand’s high growth businesses and investors in the private equity and venture capital markets. It specialises in working with SMEs that have the potential to generate significant rewards for shareholders, investors, employees and the wider economy. I Grow work with parties who want to invest in New Zealand’s entrepreneurial sectors as well as with aspiring companies who require additional capital or strategic capability to achieve their goals. Visit www.igrow.co.nz
Ignition Partner specialises in helping companies grow. It is driven by two of New Zealand's most experienced venture advisers - John Cunningham and Chad Wilkie. Ignition Partner works with Crown Research Institutes, SMEs and corporates, helping them to expand outside New Zealand. It assists companies with strategies for growth from innovation, on going licensing, strategic alliance and capital raising deals. Ignition has a particular strength in training. John Cunningham has lectured in the Waikato University Master of Technology Management programme for a decade and Chad Wilkie has recently been conducting LaunchPad workshops for established companies. Visit www.ignitionpartner.com
Realize Technology specialises in technology commercialisation. It helps public research organisations, universities, private businesses and entrepreneurs to prepare their technologies, products and ideas for market. When technologies are fully developed and ready for commercialisation, Realize works with the business through the next steps to creating new enterprises in conjunction with corporate partners. This includes evaluation and protection of intellectual property, company formation, technology licensing, finance raising, marketing, commercial and general management, early stage partnering, and securing permanent experienced management staff. Visit www.realize.co.nz